Report text available as:

  • TXT
  • PDF   (PDF provides a complete and accurate display of this text.) Tip ?
 
 
115th Congress      }                               {  Rept. 115-481
                        HOUSE OF REPRESENTATIVES
 1st Session        }                               {          Part 1
======================================================================



 
  COMPREHENSIVE OPERATIONS, SUSTAINABILITY, AND TRANSPORT ACT OF 2017

                                _______
                                

 December 21, 2017.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Brady of Texas, from the Committee on Ways and Means, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 3729]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 3729) to amend titles XI and XVIII of the Social 
Security Act to facilitate provider and supplier cost reporting 
of ambulance services under the Medicare program, and for other 
purposes, having considered the same, report favorably thereon 
with an amendment and recommend that the bill as amended do 
pass.

                                CONTENTS

                                                                   Page
  I. SUMMARY AND BACKGROUND...........................................4
          A. Purpose and Summary.................................     4
          B. Background and Need for Legislation.................     4
          C. Legislative History.................................     5
 II. EXPLANATION OF THE BILL..........................................5
          A. Comprehensive Operations, Sustainability and 
              Transport Act of 2017..............................     5
III. VOTES OF THE COMMITTEE...........................................7
 IV. BUDGET EFFECTS OF THE BILL.......................................7
          A. Committee Estimate of Budgetary Effects.............     7
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................     7
          C. Cost Estimate Prepared by the Congressional Budget 
              Office.............................................     7
  V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE......13
          A. Committee Oversight Findings and Recommendations....    13
          B. Statement of General Performance Goals and 
              Objectives.........................................    13
          C. Information Relating to Unfunded Mandates...........    13
          D. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................    13
          E. Duplication of Federal Programs.....................    13
          F. Disclosure of Directed Rule Makings.................    14
 VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED...........14
VII. EXCHANGES OF LETTERS WITH ADDITIONAL COMMITTEES OF REFERRAL.....77

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Comprehensive Operations, 
Sustainability, and Transport Act of 2017''.

SEC. 2. GROUND AMBULANCE SERVICES COST REPORTING REQUIREMENT.

  (a) In General.--Section 1121 of the Social Security Act (42 U.S.C. 
1320a) is amended--
          (1) in subsection (a)--
                  (A) by striking ``For the purposes of'' and inserting 
                ``Subject to subsection (d), for the purposes of'';
                  (B) by inserting ``suppliers of ground ambulance 
                services,'' after ``health maintenance 
                organizations,''; and
                  (C) in the matter following paragraph (5), by adding 
                the following new sentence: ``Not later than December 
                31, 2019, the Secretary shall modify the uniform 
                reporting system for providers of services with respect 
                to ambulance services to ensure that such system 
                contains information similar (as determined by the 
                Secretary) to information required under the uniform 
                reporting system for suppliers of ground ambulance 
                services.''; and
          (2) by adding at the end the following new subsection:
  ``(d) In the case of a supplier of ground ambulance services that 
furnishes such services for fewer than 20 individuals entitled to 
benefits under part A of title XVIII and enrolled under part B of such 
title in a cost reporting period (as defined by the Secretary), the 
Secretary may modify the requirements for inclusion of any information 
specified in subsection (a) in reports made in accordance with the 
uniform reporting systems established under this section with respect 
to such services.''.
  (b) Suspension of Payment for Ground Ambulance Services; Deeming 
Certain Payments Overpayments.--Section 1834(l) of the Social Security 
Act (42 U.S.C. 1395m(l)) is amended by adding at the end the following 
new paragraph:
          ``(17) Requirement to submit cost report and authority to 
        suspend payments and deem certain payments overpayments for 
        ground ambulance services.--
                  ``(A) In general.--With respect to ground ambulance 
                services furnished by a supplier of such services 
                during cost reporting periods (as defined in 
                subparagraph (I)) beginning on or after January 1, 
                2020, such supplier shall make reports to the Secretary 
                of information described in section 1121(a) in 
                accordance with the uniform reporting system 
                established under such section for such suppliers and, 
                as may be required by the Secretary, of any of the 
                information described in subparagraph (B).
                  ``(B) Additional information.--The Secretary may, 
                with respect to a supplier of ground ambulance 
                services, require the following information (to be 
                reported to the extent practicable under the uniform 
                reporting system established under section 1121(a) for 
                such suppliers):
                          ``(i) Whether the supplier is part of an 
                        emergency services department, a governmental 
                        organization, or another type of entity (as 
                        described by the Secretary).
                          ``(ii) The number of hours in a week during 
                        which the supplier is available for furnishing 
                        ground ambulance services.
                          ``(iii) The average number of volunteer hours 
                        a week used by the supplier.
                  ``(C) Suspension of payment.--Subject to subparagraph 
                (E), in the case that the Secretary determines that a 
                supplier of ground ambulance services has not made to 
                the Secretary a timely report described in subparagraph 
                (A) with respect to a cost reporting period beginning 
                on or after January 1, 2020, and before January 1, 
                2022, the Secretary may suspend payments made under 
                this subsection, in whole or in part, to such supplier 
                until the Secretary finds that such supplier has made 
                such a report.
                  ``(D) Deeming certain payments overpayments.--Subject 
                to subparagraphs (E) and (F), in the case that the 
                Secretary determines that a supplier of ground 
                ambulance services has not made to the Secretary a 
                complete, accurate, and timely report described in 
                subparagraph (A) with respect to a cost reporting 
                period beginning on or after January 1, 2022, the 
                Secretary may deem payments made under this subsection 
                to such supplier for such period to be overpayments and 
                recoup such overpayments.
                  ``(E) Hardship delay.--The Secretary shall establish 
                a process whereby a supplier of ground ambulance 
                services may request a delay in making a report 
                described in subparagraph (A) with respect to a cost 
                reporting period for reason of significant hardship (as 
                determined by the Secretary).
                  ``(F) Authority to modify cost reporting elements and 
                enforcement.--Not earlier than January 1, 2023, the 
                Secretary may provide that subparagraph (D) no longer 
                applies to ground ambulance services suppliers or a 
                category of such suppliers after--
                          ``(i) taking into account the recommendation 
                        of the Medicare Payment Advisory Commission in 
                        the most recent report available to the 
                        Secretary submitted under section 3 of the 
                        Comprehensive Operations, Sustainability, and 
                        Transport Act of 2017 regarding whether cost 
                        reports made by suppliers or a category of 
                        suppliers (as specified for purposes of the 
                        report submitted under such section) should be 
                        required or modified; and
                          ``(ii) undertaking notice and comment 
                        rulemaking.
                  ``(G) Audit of cost reports.--The Secretary shall 
                audit reports described in subparagraph (A) made with 
                respect to cost reporting periods beginning on or after 
                January 1, 2021.
                  ``(H) Appeals.--The Secretary shall establish a 
                process whereby a supplier of ground ambulance services 
                may appeal a determination described in subparagraph 
                (C) or (D) made with respect to a cost report required 
                to be made by such supplier under subparagraph (A).
                  ``(I) Definition.--In this paragraph, the term `cost 
                reporting period' means, with respect to a year, the 
                12-month period beginning on January 1 of such year.''.
  (c) Stakeholder Feedback.--
          (1) In general.--The Secretary of Health and Human Services 
        shall implement the provisions of this section, including the 
        amendments made by this section, through notice and comment 
        rulemaking and seek input from stakeholders.
          (2) Nonapplication of paperwork reduction act.--Chapter 35 of 
        title 44, United States Code, shall not apply with respect to--
                  (A) the development and implementation of the uniform 
                reporting system required under section 1121(a) of the 
                Social Security Act (42 U.S.C. 1320a(a)) for suppliers 
                of ground ambulance services and reports required to be 
                made under section 1834(l)(17) of such Act (42 U.S.C. 
                1395m(l)(17)); and
                  (B) the modification of the uniform reporting systems 
                under such section 1121(a) of such Act for providers of 
                such services and reports required to be made under 
                section 1861(v)(1)(F) of such Act (42 U.S.C. 
                1395x(v)(1)(F)).
  (d) Implementation Resources.--
          (1) In general.--There are hereby appropriated to the 
        Secretary from the Federal Hospital Insurance Trust Fund under 
        section 1817 of the Social Security Act (42 U.S.C. 1395i) 
        $8,000,000 and from the Federal Supplementary Medical Insurance 
        Trust Fund under section 1841 of such Act (42 U.S.C. 1395t) 
        $92,000,000 (of which not less than $10,000,000 shall be used 
        to fulfill the auditing requirement under section 
        1834(l)(17)(G) of such Act, as added by subsection (b) of this 
        section) to carry out the provisions of this section, including 
        the amendments made by this section, to remain available 
        through December 31, 2022.
          (2) Funding for employees.--The Secretary of Health and Human 
        Services shall provide for the transfer to the Centers for 
        Medicare & Medicaid Services Program Management Account, from 
        the Federal Supplementary Medical Insurance Trust Fund under 
        section 1841 of the Social Security Act (42 U.S.C. 1395t), of 
        such sums as may be necessary in order to directly hire no more 
        than 2 full-time employees to carry out the provisions of this 
        section, including the amendments made by this section.
  (e) Sense of Congress.--It is the sense of Congress that--
          (1) a cost report made by a supplier of ground ambulance 
        services with respect to a cost reporting period beginning 
        before January 1, 2022, may not contain complete and accurate 
        information on ground ambulance services furnished during such 
        a period by the supplier; and
          (2) the Secretary should take into account only the 
        timeliness of such a report made with respect to such a period 
        when determining whether to suspend payments to a supplier 
        under section 1834(l) of the Social Security Act (42 U.S.C. 
        1395m(l)).

SEC. 3. GROUND AMBULANCE SERVICES COST REPORTING STUDY.

  (a) In General.--Not later than March 15, 2022, and as determined 
necessary by the Medicare Payment Advisory Commission thereafter, such 
Commission shall assess and submit to Congress a report on cost reports 
carried out in accordance with sections 1121(a) and 1834(l) of the 
Social Security Act (42 U.S.C. 1320a(a), 1395m(l)), the adequacy of 
payments for such services made under section 1834(l) of such Act, and 
the extent to which state mandates may create geographic variations in 
the cost of providing such services.
  (b) Contents.--The report described in subsection (a) shall contain 
the following:
          (1) An analysis of cost report data submitted in accordance 
        with such sections.
          (2) An analysis of any burden on providers and suppliers of 
        such services associated with reporting such data.
          (3) A recommendation on whether or not cost reports of 
        ambulance services made by suppliers or a category of suppliers 
        (as specified by the Secretary) of such services, or the ground 
        ambulance portion of cost reports made by providers of such 
        services, should be required or modified, taking into account 
        the analyses described in paragraphs (1) and (2).

SEC. 4. EXTENSION OF GROUND AMBULANCE SERVICES EXTENDERS AND PAY-FOR.

  Section 1834(l) of the Social Security Act (42. U.S.C. 1395m(l)) is 
amended--
          (1) in paragraph (12)(A), by striking ``2018'' and inserting 
        ``2023'';
          (2) in paragraph (13)(A), by striking ``2018'' each place it 
        appears and inserting ``2023''; and
          (3) in paragraph (15), by striking ``on or after October 1, 
        2013'' and inserting ``during the period beginning on October 
        1, 2013, and ending on September 30, 2018, and by 32 percent 
        for such services furnished on or after October 1, 2018''.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    The bill, H.R. 3729, the ``Comprehensive Operations, 
Sustainability and Transport (``COST'') Act of 2017,'' as 
ordered reported by the Committee on Ways and Means on 
September 13, 2017, focuses on accurately reimbursing and 
sustaining access to ground ambulance transports in the 
Medicare program. The bill would achieve two primary 
objectives: (1) required submission of annual cost report data 
by Medicare ambulance suppliers and providers to better 
understand the cost of furnishing ground ambulance services; 
and (2) extension of the current law add-on reimbursement for 
ground ambulance services that would otherwise expire on 
December 31, 2017.

                 B. Background and Need for Legislation

    On September 11, 2017, Representative Nunes (R-CA) and 
Representative Sewell (D-AL) introduced H.R. 3729, legislation 
to facilitate provider and supplier cost reporting of ambulance 
services under the Medicare program. Along with the Committee 
on Energy and Commerce, the Committee on Ways and Means 
received a referral for the bill because it includes Medicare 
provisions that fall within the jurisdiction of the Committee, 
including changes to relevant provisions of the Social Security 
Act (``SSA'').
    In the Balanced Budget Act of 1997 (``BBA `7''), Congress 
mandated a negotiated rulemaking process to establish an 
ambulance fee schedule with the intent to transition away from 
cost-based reimbursement. Due to a lack of cost report data, 
the ambulance fee schedule was established without data on the 
cost of providing ambulance services to Medicare beneficiaries.
    In the Medicare Modernization Act (``MMA of 2003''), 
Congress established a new temporary program to supplement 
ambulance reimbursement with add-on payments for services in 
urban areas, rural areas, and super-rural areas. These add-on 
payments have continued to be extended and are currently set to 
expire on December 31, 2017.
    The Medicare Payment Advisory Committee (``MedPAC'') has 
assessed the ambulance fee schedule and raised concerns, 
including involving potential fraud and abuse, regarding non-
emergency basic life support (``BLS'') End-Stage Renal Disease 
(``ESRD'') transports. MedPAC found that the Medicare program 
pays more money to transport beneficiaries to dialysis than the 
actual dialysis service.

                         C. Legislative History


Background

    H.R. 3729 was introduced on September 11, 2017, and was 
referred to the Committee on Ways and Means and additionally to 
the Committee on Energy and Commerce.

Committee hearings

    On June 8, 2017, the Committee held a hearing on The 
Department of Health and Human Services' (HHS) Fiscal Year 2018 
Budget Request, at which topics such as Medicare extenders were 
discussed.
    On May 18, 2017, the Subcommittee on Health held a hearing 
on the Current Status of the Medicare Program, Payments Systems 
and Extenders, at which MedPAC's recommendations on 
``extender'' policies were discussed, including those regarding 
ambulance reimbursements.

Committee action

    The Committee on Ways and Means marked up H.R. 3729, the 
``Comprehensive Operations, Sustainability and Transport 
(``COST'') Act of 2017,'' on September 13, 2017, and ordered 
the bill, as amended, favorably reported (with a quorum being 
present).

                      II. EXPLANATION OF THE BILL


 A. Comprehensive Operations, Sustainability and Transport Act of 2017


                              PRESENT LAW

    Current law does not require cost reporting from providers 
and suppliers of ground ambulance services. Rather, ambulance 
suppliers and providers are paid under a fee schedule 
established under BBA '97.
    MedPAC does not currently submit an annual report to 
Congress regarding payment adequacy for ambulance services.
    Current law extends add-on payments for ground ambulance 
services through December 31, 2017. These add-on payments, last 
extended under the Medicare Access and CHIP Reauthorization Act 
(``MACRA'') of 2015, are: (1) two percent for services in urban 
areas; (2) three percent for services in rural areas; and (3) 
22.6 percent for services in super-rural areas.
    Finally, under current law, there is a 10 percent reduction 
for non-emergency dialysis transports.

                           REASONS FOR CHANGE

    There is a current lack of cost reporting data among 
suppliers of ground ambulance services. This legislation would 
assist the Centers for Medicare and Medicaid Services (``CMS'') 
to more accurately and empirically understand how much it costs 
to provide ground ambulance services to Medicare beneficiaries.
    An analysis from MedPAC regarding the accuracy and burden 
of reporting cost data will assist Congress in understanding 
whether future payment reforms, such as rebasing and extending 
add-on payments, are warranted.
    In the absence of the extension, the add-on payments would 
expire on December 31, 2017.

                       EXPLANATION OF PROVISIONS

    Section 1: This section states the short title as the 
``Comprehensive Operations, Sustainability and Transport Act of 
2017.''
    Section 2: This section would modify section 1121 of the 
SSA, requiring annual cost reporting. The legislation would 
allow the Secretary of HHS to modify cost reporting 
requirements for low-volume ambulance suppliers. It would also 
require the development of a hardship exemption process for 
those ambulance suppliers that demonstrate the need for 
additional support or that may need an extension for filing a 
cost report. In addition, the bill would require input from 
stakeholders, as well as a public comment process and an 
appeals process. To enforce the new cost reporting requirement, 
the Secretary would be able to issue a payment suspension 
(beginning January 1, 2020 through December 31, 2021) and 
determine overpayments subject to recoupment (from January 1, 
2022 and thereafter) for suppliers that fail to report. 
However, the Congressional Budget Office issued an analysis of 
the bill stating:

          Based on a longstanding pattern of granting waivers 
        and working with providers to bring them into 
        compliance with new requirements--rather than imposing 
        financial penalties--CBO expects that the Secretary 
        would not penalize any suppliers and estimates that no 
        payments would be suspended or reduced.

    Section 3: This section would require MedPAC to submit a 
report to Congress that includes an analysis of: (1) the 
accuracy of cost report data; (2) the burden of reporting; and 
(3) possible modifications of data collection.
    Section 4: This section would extend the 2 percent urban, 3 
percent rural, and 22.6 percent super-rural ground ambulance 
add-on payments for five years. Further, the bill would 
increase the reduction for non-emergency dialysis transports to 
32 percent.

                             EFFECTIVE DATE

    Section 2: Cost reporting for ambulance suppliers is 
required no later than January 1, 2020. The Secretary would be 
able to issue a payment suspension beginning January 1, 2020 
through December 31, 2021 and determine overpayments subject to 
recoupment from January 1, 2020 and thereafter for suppliers 
that fail report.
    Beginning January 1, 2023, the cost report requirements may 
be modified based on the MedPAC report required in section 3.
    Section 3: The legislation requires that MedPAC submit a 
report to Congress by March 15, 2022 (and annually thereafter, 
if necessary).
    Section 4: The add-on payments expire December 31, 2017 
without extension. The bill extends such payments through 
December 31, 2022.

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the vote of the Committee on Ways and Means in its 
consideration of H.R. 3729, the COST Act of 2017, on September 
13, 2017.
    The Chairman's amendment in the nature of a substitute was 
adopted by a voice vote (with a quorum being present).
    The bill, H.R. 3729, was ordered favorably reported as 
amended by voice vote (with a quorum being present).

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the bill, H.R. 3729, as 
reported. The Committee agrees with the estimate prepared by 
the Congressional Budget Office (CBO), which is included below.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
bill involves no new or increased budget authority. The 
Committee states further that the bill involves no new or 
increased tax expenditures.

      C. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided.

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 27, 2017.
Hon. Kevin Brady,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3729, the 
Comprehensive Operations, Sustainability, and Transport Act of 
2017.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Rebecca Yip 
and Lara Robillard.
            Sincerely,
                                                Keith Hall,
                                                          Director.
    Enclosure.

H.R. 3729--Comprehensive Operations, Sustainability, and Transport Act 
        of 2017

    Summary: H.R. 3729 would impose new reporting requirements 
on entities that furnish ambulance services to Medicare 
beneficiaries. The bill would also extend Medicare payments for 
ambulance services that would otherwise expire under current 
law and reduce the payment rate for certain ambulance services. 
CBO estimates that enacting H.R. 3729 would reduce net direct 
spending by about $895 million over the 2018-2027 period.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending. The legislation would 
not affect revenues.
    CBO estimates that enacting the legislation would not 
increase net direct spending or on-budget deficits in any of 
the four consecutive 10-year periods beginning in 2028.
    H.R. 3729 contains no private-sector or intergovernmental 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary effect of H.R. 3729 is shown in the following table. 
The costs of this legislation fall within budget function 570 
(Medicare).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         By fiscal year, in millions of dollars--
                                 -----------------------------------------------------------------------------------------------------------------------
                                   2017    2018    2019    2020    2021    2022     2023      2024      2025      2026      2027    2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      INCREASES OR DECREASES (-) IN DIRECT SPENDING
 
Estimated Budget Authority......       0     150      90      60      55      50      -160      -235      -270      -300      -335        405       -895
Estimated Outlays...............       0     150      90      60      55      50      -160      -235      -270      -300      -335        405       -895
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: For this estimate, CBO assumes that H.R. 
3729 will be enacted early in fiscal year 2018.
    H.R. 3729 would require the Centers for Medicare and 
Medicaid Services (CMS) to implement a new system through which 
suppliers of ambulance services would submit data on the costs 
they incur to provide services to Medicare beneficiaries.\1\ 
CMS would be required to have this new cost-reporting system in 
place by January 1, 2020. The bill would appropriate $100 
million to CMS to support creation of that new cost-reporting 
system and would also appropriate whatever sums are necessary 
to hire two new employees. Based on historical spending 
patterns for CMS program management activities and on data 
about the typical cost of a full-time employee, currently about 
$135,000 per year, CBO estimates that developing the new cost-
reporting system would cost about $103 million over the 2017-
2027 period.
---------------------------------------------------------------------------
    \1\The Medicare program makes a distinction between providers of 
ambulance services, which are based at institutions (such as a 
hospital), and suppliers of ambulance services, which are not based at 
institutions. Suppliers could be affiliated with a fire station or 
could be a for-profit company. Providers already submit cost reports to 
CMS.
---------------------------------------------------------------------------
    Once the new system is operational, suppliers who fail to 
submit those reports could be subject to payment suspensions or 
reductions. H.R. 3729 would allow the Secretary of Health and 
Human Services to exempt certain low-volume providers from the 
new reporting requirement. The Secretary could also grant 
hardship delays to small suppliers. Based on a longstanding 
pattern of granting waivers and working with providers to bring 
them into compliance with new requirements--rather than 
imposing financial penalties--CBO expects that the Secretary 
would not penalize any suppliers and estimates that no payments 
would be suspended or reduced.
    H.R. 3729 would extend certain Medicare add-on payments to 
ambulance providers and suppliers that would otherwise expire 
on December 31 of this year. Those add-on payments are linked 
to the geographic location (urban, rural, or super-rural, as 
defined by zip code) in which the trip begins. H.R. 3729 would 
extend these payments for five years, though 2022 as follows:
           For trips in urban areas, an increase of 2 
        percent applied to the base payment and to a payment 
        per mile traveled;
           An upward adjustment of 3 percent to the 
        base payment and to mileage for trips in rural areas; 
        and
           In super-rural areas, an add-on payment of 
        22.6 percent, applied only to the base rate and not to 
        mileage. The super-rural adjustment is not specified in 
        the statute, but is instead calculated by CMS.
    CBO estimates that extending those add-on payments would 
increase direct spending by about $1 billion over the 2017-2027 
period.
    Ambulance suppliers and providers can furnish non-emergency 
transportation for beneficiaries who are traveling to or from 
renal dialysis services. Under current law, the fee that 
Medicare pays for those trips is reduced by ten percent if the 
ambulance offers basic life-support level services. Under H.R. 
3729, that reduction would total 32 percent, beginning October 
1, 2018; CBO estimates that direct spending would decrease by 
about $2 billion over the 2017-2027 period as a result.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

         CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 3729, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON SEPTEMBER 13, 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         By fiscal year, in millions of dollars--
                                 -----------------------------------------------------------------------------------------------------------------------
                                   2017    2018    2019    2020    2021    2022     2023      2024      2025      2026      2027    2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact..       0     150      90      60      55      50      -160      -235      -270      -300      -335        405       -895
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2028.
    Intergovernmental and private-sector impact: H.R. 3729 
contains no private-sector or intergovernmental mandates as 
defined in UMRA.
    Estimate prepared by: Federal costs: Rebecca Yip and Lara 
Robillard; Impact on state, local, and tribal governments: 
Zachary Byrum; Impact on the private sector: Amy Petz.
    Estimate approved by: Theresa Gullo, Assistant Director for 
Budget Analysis.

     V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, the Committee made findings and 
recommendations that are reflected in this report.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill does not authorize funding, so no statement of general 
performance goals and objectives is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

  D. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill, and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                   E. Duplication of Federal Programs

    In compliance with clause 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program; (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139; or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to the Federal Program 
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No. 
98-169).

                 F. Disclosure of Directed Rule Makings

    In compliance with Sec. 3(i) of H. Res. 5 (115th Congress), 
the following statement is made concerning directed rule 
makings: The Committee estimates that the bill requires the 
following directed rule makings within the meaning of such 
section: Section 2 regarding the modification of the 
enforcement of cost reporting requirements for low-volume 
ambulance suppliers, the issuance of a payment suspension, and 
determining overpayments subject to recoupment for suppliers 
that fail to report.

       VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is show in roman):

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                          SOCIAL SECURITY ACT



           *       *       *       *       *       *       *
     TITLE XI--GENERAL PROVISIONS, PEER REVIEW, AND ADMINISTRATIVE 
                             SIMPLIFICATION

Part A--General Provisions

           *       *       *       *       *       *       *


     uniform reporting systems for health services facilities and 
                             organizations

  Sec. 1121. (a) [For the purposes of] Subject to subsection 
(d), for the purposes of reporting the cost of services 
provided by, of planning, and of measuring and comparing the 
efficiency of and effective use of services in, hospitals, 
skilled nursing facilities, intermediate care facilities, home 
health agencies, health maintenance organizations, suppliers of 
ground ambulance services, and other types of health services 
facilities and organizations to which payment may be made under 
this Act, the Secretary shall establish by regulation, for each 
such type of health services facility or organization, a 
uniform system for the reporting by a facility or organization 
of that type of the following information:
          (1) The aggregate cost of operation and the aggregate 
        volume of services.
          (2) The costs and volume of services for various 
        functional accounts and subaccounts.
          (3) Rates, by category of patient and class of 
        purchaser.
          (4) Capital assets, as defined by the Secretary, 
        including (as appropriate) capital funds, debt service, 
        lease agreements used in lieu of capital funds, and the 
        value of land, facilities, and equipment.
          (5) Discharge and bill data.
The uniform reporting system for a type of health services 
facility or organization shall provide for appropriate 
variation in the application of the system to different classes 
of facilities or organizations within that type and shall be 
established, to the extent practicable, consistent with the 
cooperative system for producing comparable and uniform health 
information and statistics described in section 306(e)(1) of 
the Public Health Service Act. In reporting under such a 
system, hospitals shall employ such chart of accounts, 
definitions, principles, and statistics as the Secretary may 
prescribe in order to reach a uniform reconciliation of 
financial and statistical data for specified uniform reports to 
be provided to the Secretary. Not later than December 31, 2019, 
the Secretary shall modify the uniform reporting system for 
providers of services with respect to ambulance services to 
ensure that such system contains information similar (as 
determined by the Secretary) to information required under the 
uniform reporting system for suppliers of ground ambulance 
services.
  (b) The Secretary shall--
          (1) monitor the operation of the systems established 
        under subsection (a);
          (2) assist with and support demonstrations and 
        evaluations of the effectiveness and cost of the 
        operation of such systems and encourage State adoption 
        of such systems; and
          (3) periodically revise such systems to improve their 
        effectiveness and diminish their cost.
  (c) The Secretary shall provide information obtained through 
use of the uniform reporting systems described in subsection 
(a) in a useful manner and format to appropriate agencies and 
organizations, including health systems agencies (designated 
under section 1515 of the Public Health Service Act) and State 
health planning and development agencies (designated under 
section 1521 of such Act), as may be necessary to carry out 
such agencies' and organizations' functions.
  (d) In the case of a supplier of ground ambulance services 
that furnishes such services for fewer than 20 individuals 
entitled to benefits under part A of title XVIII and enrolled 
under part B of such title in a cost reporting period (as 
defined by the Secretary), the Secretary may modify the 
requirements for inclusion of any information specified in 
subsection (a) in reports made in accordance with the uniform 
reporting systems established under this section with respect 
to such services.

           *       *       *       *       *       *       *


TITLE XVIII--HEALTH INSURANCE FOR THE AGED AND DISABLED

           *       *       *       *       *       *       *


   Part B--Supplementary Medical Insurance Benefits for the Aged and 
Disabled

           *       *       *       *       *       *       *


        SPECIAL PAYMENT RULES FOR PARTICULAR ITEMS AND SERVICES

  Sec. 1834. (a) Payment for Durable Medical Equipment.--
          (1) General rule for payment.--
                  (A) In general.--With respect to a covered 
                item (as defined in paragraph (13)) for which 
                payment is determined under this subsection, 
                payment shall be made in the frequency 
                specified in paragraphs (2) through (7) and in 
                an amount equal to 80 percent of the payment 
                basis described in subparagraph (B).
                  (B) Payment basis.--Subject to subparagraph 
                (F)(i), the payment basis described in this 
                subparagraph is the lesser of--
                          (i) the actual charge for the item, 
                        or
                          (ii) the payment amount recognized 
                        under paragraphs (2) through (7) of 
                        this subsection for the item;
                except that clause (i) shall not apply if the 
                covered item is furnished by a public home 
                health agency (or by another home health agency 
                which demonstrates to the satisfaction of the 
                Secretary that a significant portion of its 
                patients are low income) free of charge or at 
                nominal charges to the public.
                  (C) Exclusive payment rule.--Subject to 
                subparagraph (F)(ii), this subsection shall 
                constitute the exclusive provision of this 
                title for payment for covered items under this 
                part or under part A to a home health agency.
                  (D) Reduction in fee schedules for certain 
                items.--With respect to a seat-lift chair or 
                transcutaneous electrical nerve stimulator 
                furnished on or after April 1, 1990, the 
                Secretary shall reduce the payment amount 
                applied under subparagraph (B)(ii) for such an 
                item by 15 percent, and, in the case of a 
                transcutaneous electrical nerve stimulator 
                furnished on or after January 1, 1991, the 
                Secretary shall further reduce such payment 
                amount (as previously reduced) by 45 percent.
                  (E) Clinical conditions for coverage.--
                          (i) In general.--The Secretary shall 
                        establish standards for clinical 
                        conditions for payment for covered 
                        items under this subsection.
                          (ii) Requirements.--The standards 
                        established under clause (i) shall 
                        include the specification of types or 
                        classes of covered items that require, 
                        as a condition of payment under this 
                        subsection, a face-to-face examination 
                        of the individual by a physician (as 
                        defined in section 1861(r)), a 
                        physician assistant, nurse 
                        practitioner, or a clinical nurse 
                        specialist (as those terms are defined 
                        in section 1861(aa)(5)) and a 
                        prescription for the item.
                          (iii) Priority of establishment of 
                        standards.--In establishing the 
                        standards under this subparagraph, the 
                        Secretary shall first establish 
                        standards for those covered items for 
                        which the Secretary determines there 
                        has been a proliferation of use, 
                        consistent findings of charges for 
                        covered items that are not delivered, 
                        or consistent findings of falsification 
                        of documentation to provide for payment 
                        of such covered items under this part.
                          (iv) Standards for power 
                        wheelchairs.--Effective on the date of 
                        the enactment of this subparagraph, in 
                        the case of a covered item consisting 
                        of a motorized or power wheelchair for 
                        an individual, payment may not be made 
                        for such covered item unless a 
                        physician (as defined in section 
                        1861(r)(1)), a physician assistant, 
                        nurse practitioner, or a clinical nurse 
                        specialist (as those terms are defined 
                        in section 1861(aa)(5)) has conducted a 
                        face-to-face examination of the 
                        individual and written a prescription 
                        for the item.
                          (v) Limitation on payment for covered 
                        items.--Payment may not be made for a 
                        covered item under this subsection 
                        unless the item meets any standards 
                        established under this subparagraph for 
                        clinical condition of coverage.
                  (F) Application of competitive acquisition; 
                limitation of inherent reasonableness 
                authority.--In the case of covered items 
                furnished on or after January 1, 2011, subject 
                to subparagraphs (G) and (H), that are included 
                in a competitive acquisition program in a 
                competitive acquisition area under section 
                1847(a)--
                          (i) the payment basis under this 
                        subsection for such items and services 
                        furnished in such area shall be the 
                        payment basis determined under such 
                        competitive acquisition program;
                          (ii) the Secretary may (and, in the 
                        case of covered items furnished on or 
                        after January 1, 2016, subject to 
                        clause (iii), shall) use information on 
                        the payment determined under such 
                        competitive acquisition programs to 
                        adjust the payment amount otherwise 
                        recognized under subparagraph (B)(ii) 
                        for an area that is not a competitive 
                        acquisition area under section 1847 and 
                        in the case of such adjustment, 
                        paragraph (10)(B) shall not be applied; 
                        and
                          (iii) in the case of covered items 
                        furnished on or after January 1, 2016, 
                        the Secretary shall continue to make 
                        such adjustments described in clause 
                        (ii) as, under such competitive 
                        acquisition programs, additional 
                        covered items are phased in or 
                        information is updated as contracts 
                        under section 1847 are recompeted in 
                        accordance with section 1847(b)(3)(B).
                  (G) Use of information on competitive bid 
                rates.--The Secretary shall specify by 
                regulation the methodology to be used in 
                applying the provisions of subparagraph (F)(ii) 
                and subsection (h)(1)(H)(ii). In promulgating 
                such regulation, the Secretary shall consider 
                the costs of items and services in areas in 
                which such provisions would be applied compared 
                to the payment rates for such items and 
                services in competitive acquisition areas.In 
                the case of items and services furnished on or 
                after January 1, 2019, in making any 
                adjustments under clause (ii) or (iii) of 
                subparagraph (F), under subsection 
                (h)(1)(H)(ii), or under section 1842(s)(3)(B), 
                the Secretary shall--
                          (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.
                  (H) Diabetic supplies.--
                          (i) In general.--On or after the date 
                        described in clause (ii), the payment 
                        amount under this part for diabetic 
                        supplies, including testing strips, 
                        that are non-mail order items (as 
                        defined by the Secretary) shall be 
                        equal to the single payment amounts 
                        established under the national mail 
                        order competition for diabetic supplies 
                        under section 1847.
                          (ii) Date described.--The date 
                        described in this clause is the date of 
                        the implementation of the single 
                        payment amounts under the national mail 
                        order competition for diabetic supplies 
                        under section 1847.
                  (I) Treatment of vacuum erection systems.--
                Effective for items and services furnished on 
                and after July 1, 2015, vacuum erection systems 
                described as prosthetic devices described in 
                section 1861(s)(8) shall be treated in the same 
                manner as erectile dysfunction drugs are 
                treated for purposes of section 1860D-
                2(e)(2)(A).
          (2) Payment for inexpensive and other routinely 
        purchased durable medical equipment.--
                  (A) In general.--Payment for an item of 
                durable medical equipment (as defined in 
                paragraph (13))--
                          (i) the purchase price of which does 
                        not exceed $150,
                          (ii) which the Secretary determines 
                        is acquired at least 75 percent of the 
                        time by purchase,
                          (iii) which is an accessory used in 
                        conjunction with a nebulizer, 
                        aspirator, or a ventilator excluded 
                        under paragraph (3)(A), or
                          (iv) in the case of devices furnished 
                        on or after October 1, 2015, and before 
                        October 1, 2018, which serves as a 
                        speech generating device or which is an 
                        accessory that is needed for the 
                        individual to effectively utilize such 
                        a device,
                shall be made on a rental basis or in a lump-
                sum amount for the purchase of the item. The 
                payment amount recognized for purchase or 
                rental of such equipment is the amount 
                specified in subparagraph (B) for purchase or 
                rental, except that the total amount of 
                payments with respect to an item may not exceed 
                the payment amount specified in subparagraph 
                (B) with respect to the purchase of the item.
                  (B) Payment amount.--For purposes of 
                subparagraph (A), the amount specified in this 
                subparagraph, with respect to the purchase or 
                rental of an item furnished in a carrier 
                service area--
                          (i) in 1989 and in 1990 is the 
                        average reasonable charge in the area 
                        for the purchase or rental, 
                        respectively, of the item for the 12-
                        month period ending on June 30, 1987, 
                        increased by the percentage increase in 
                        the consumer price index for all urban 
                        consumers (U.S. city average) for the 
                        6-month period ending with December 
                        1987;
                          (ii) in 1991 is the sum of (I) 67 
                        percent of the local payment amount for 
                        the item or device computed under 
                        subparagraph (C)(i)(I) for 1991, and 
                        (II) 33 percent of the national limited 
                        payment amount for the item or device 
                        computed under subparagraph (C)(ii) for 
                        1991;
                          (iii) in 1992 is the sum of (I) 33 
                        percent of the local payment amount for 
                        the item or device computed under 
                        subparagraph (C)(i)(II) for 1992, and 
                        (II) 67 percent of the national limited 
                        payment amount for the item or device 
                        computed under subparagraph (C)(ii) for 
                        1992; and
                          (iv) in 1993 and each subsequent year 
                        is the national limited payment amount 
                        for the item or device computed under 
                        subparagraph (C)(ii) for that year 
                        (reduced by 10 percent, in the case of 
                        a blood glucose testing strip furnished 
                        after 1997 for an individual with 
                        diabetes).
                  (C) Computation of local payment amount and 
                national limited payment amount.--For purposes 
                of subparagraph (B)--
                          (i) the local payment amount for an 
                        item or device for a year is equal to--
                                  (I) for 1991, the amount 
                                specified in subparagraph 
                                (B)(i) for 1990 increased by 
                                the covered item update for 
                                1991, and
                                  (II) for 1992, 1993, and 1994 
                                the amount determined under 
                                this clause for the preceding 
                                year increased by the covered 
                                item update for the year; and
                          (ii) the national limited payment 
                        amount for an item or device for a year 
                        is equal to--
                                  (I) for 1991, the local 
                                payment amount determined under 
                                clause (i) for such item or 
                                device for that year, except 
                                that the national limited 
                                payment amount may not exceed 
                                100 percent of the weighted 
                                average of all local payment 
                                amounts determined under such 
                                clause for such item for that 
                                year and may not be less than 
                                85 percent of the weighted 
                                average of all local payment 
                                amounts determined under such 
                                clause for such item,
                                  (II) for 1992 and 1993, the 
                                amount determined under this 
                                clause for the preceding year 
                                increased by the covered item 
                                update for such subsequent 
                                year,
                                  (III) for 1994, the local 
                                payment amount determined under 
                                clause (i) for such item or 
                                device for that year, except 
                                that the national limited 
                                payment amount may not exceed 
                                100 percent of the median of 
                                all local payment amounts 
                                determined under such clause 
                                for such item for that year and 
                                may not be less than 85 percent 
                                of the median of all local 
                                payment amounts determined 
                                under such clause for such item 
                                or device for that year, and
                                  (IV) for each subsequent 
                                year, the amount determined 
                                under this clause for the 
                                preceding year increased by the 
                                covered item update for such 
                                subsequent year.
          (3) Payment for items requiring frequent and 
        substantial servicing.--
                  (A) In general.--Payment for a covered item 
                (such as IPPB machines and ventilators, 
                excluding ventilators that are either 
                continuous airway pressure devices or 
                intermittent assist devices with continuous 
                airway pressure devices) for which there must 
                be frequent and substantial servicing in order 
                to avoid risk to the patient's health shall be 
                made on a monthly basis for the rental of the 
                item and the amount recognized is the amount 
                specified in subparagraph (B).
                  (B) Payment amount.--For purposes of 
                subparagraph (A), the amount specified in this 
                subparagraph, with respect to an item or device 
                furnished in a carrier service area--
                          (i) in 1989 and in 1990 is the 
                        average reasonable charge in the area 
                        for the rental of the item or device 
                        for the 12-month period ending with 
                        June 1987, increased by the percentage 
                        increase in the consumer price index 
                        for all urban consumers (U.S. city 
                        average) for the 6-month period ending 
                        with December 1987;
                          (ii) in 1991 is the sum of (I) 67 
                        percent of the local payment amount for 
                        the item or device computed under 
                        subparagraph (C)(i)(I) for 1991, and 
                        (II) 33 percent of the national limited 
                        payment amount for the item or device 
                        computed under subparagraph (C)(ii) for 
                        1991;
                          (iii) in 1992 is the sum of (I) 33 
                        percent of the local payment amount for 
                        the item or device computed under 
                        subparagraph (C)(i)(II) for 1992, and 
                        (II) 67 percent of the national limited 
                        payment amount for the item or device 
                        computed under subparagraph (C)(ii) for 
                        1992; and
                          (iv) in 1993 and each subsequent year 
                        is the national limited payment amount 
                        for the item or device computed under 
                        subparagraph (C)(ii) for that year.
                  (C) Computation of local payment amount and 
                national limited payment amount.--For purposes 
                of subparagraph (B)--
                          (i) the local payment amount for an 
                        item or device for a year is equal to--
                                  (I) for 1991, the amount 
                                specified in subparagraph 
                                (B)(i) for 1990 increased by 
                                the covered item update for 
                                1991, and
                                  (II) for 1992, 1993, and 1994 
                                the amount determined under 
                                this clause for the preceding 
                                year increased by the covered 
                                item update for the year; and
                          (ii) the national limited payment 
                        amount for an item or device for a year 
                        is equal to--
                                  (I) for 1991, the local 
                                payment amount determined under 
                                clause (i) for such item or 
                                device for that year, except 
                                that the national limited 
                                payment amount may not exceed 
                                100 percent of the weighted 
                                average of all local payment 
                                amounts determined under such 
                                clause for such item for that 
                                year and may not be less than 
                                85 percent of the weighted 
                                average of all local payment 
                                amounts determined under such 
                                clause for such item,
                                  (II) for 1992 and 1993, the 
                                amount determined under this 
                                clause for the preceding year 
                                increased by the covered item 
                                update for such subsequent 
                                year,
                                  (III) for 1994, the local 
                                payment amount determined under 
                                clause (i) for such item or 
                                device for that year, except 
                                that the national limited 
                                payment amount may not exceed 
                                100 percent of the median of 
                                all local payment amounts 
                                determined under such clause 
                                for such item for that year and 
                                may not be less than 85 percent 
                                of the median of all local 
                                payment amounts determined 
                                under such clause for such item 
                                or device for that year, and
                                  (IV) for each subsequent 
                                year, the amount determined 
                                under this clause for the 
                                preceding year increased by the 
                                covered item update for such 
                                subsequent year.
          (4) Payment for certain customized items.--Payment 
        with respect to a covered item that is uniquely 
        constructed or substantially modified to meet the 
        specific needs of an individual patient, and for that 
        reason cannot be grouped with similar items for 
        purposes of payment under this title, shall be made in 
        a lump-sum amount (A) for the purchase of the item in a 
        payment amount based upon the carrier's individual 
        consideration for that item, and (B) for the reasonable 
        and necessary maintenance and servicing for parts and 
        labor not covered by the supplier's or manufacturer's 
        warranty, when necessary during the period of medical 
        need, and the amount recognized for such maintenance 
        and servicing shall be paid on a lump-sum, as needed 
        basis based upon the carrier's individual consideration 
        for that item. In the case of a wheelchair furnished on 
        or after January 1, 1992, the wheelchair shall be 
        treated as a customized item for purposes of this 
        paragraph if the wheelchair has been measured, fitted, 
        or adapted in consideration of the patient's body size, 
        disability, period of need, or intended use, and has 
        been assembled by a supplier or ordered from a 
        manufacturer who makes available customized features, 
        modifications, or components for wheelchairs that are 
        intended for an individual patient's use in accordance 
        with instructions from the patient's physician.
          (5) Payment for oxygen and oxygen equipment.--
                  (A) In general.--Payment for oxygen and 
                oxygen equipment shall be made on a monthly 
                basis in the monthly payment amount recognized 
                under paragraph (9) for oxygen and oxygen 
                equipment (other than portable oxygen 
                equipment), subject to subparagraphs (B), (C), 
                (E), and (F).
                  (B) Add-on for portable oxygen equipment.--
                When portable oxygen equipment is used, but 
                subject to subparagraph (D), the payment amount 
                recognized under subparagraph (A) shall be 
                increased by the monthly payment amount 
                recognized under paragraph (9) for portable 
                oxygen equipment.
                  (C) Volume adjustment.--When the attending 
                physician prescribes an oxygen flow rate--
                          (i) exceeding 4 liters per minute, 
                        the payment amount recognized under 
                        subparagraph (A), subject to 
                        subparagraph (D), shall be increased by 
                        50 percent, or
                          (ii) of less than 1 liter per minute, 
                        the payment amount recognized under 
                        subparagraph (A) shall be decreased by 
                        50 percent.
                  (D) Limit on adjustment.--When portable 
                oxygen equipment is used and the attending 
                physician prescribes an oxygen flow rate 
                exceeding 4 liters per minute, there shall only 
                be an increase under either subparagraph (B) or 
                (C), whichever increase is larger, and not 
                under both such subparagraphs.
                  (E) Recertification for patients receiving 
                home oxygen therapy.--In the case of a patient 
                receiving home oxygen therapy services who, at 
                the time such services are initiated, has an 
                initial arterial blood gas value at or above a 
                partial pressure of 56 or an arterial oxygen 
                saturation at or above 89 percent (or such 
                other values, pressures, or criteria as the 
                Secretary may specify) no payment may be made 
                under this part for such services after the 
                expiration of the 90-day period that begins on 
                the date the patient first receives such 
                services unless the patient's attending 
                physician certifies that, on the basis of a 
                follow-up test of the patient's arterial blood 
                gas value or arterial oxygen saturation 
                conducted during the final 30 days of such 90-
                day period, there is a medical need for the 
                patient to continue to receive such services.
                  (F) Rental Cap.--
                          (i) In general.--Payment for oxygen 
                        equipment (including portable oxygen 
                        equipment) under this paragraph may not 
                        extend over a period of continuous use 
                        (as determined by the Secretary) of 
                        longer than 36 months.
                          (ii) Payments and rules after rental 
                        cap.--After the 36th continuous month 
                        during which payment is made for the 
                        equipment under this paragraph--
                                  (I) the supplier furnishing 
                                such equipment under this 
                                subsection shall continue to 
                                furnish the equipment during 
                                any period of medical need for 
                                the remainder of the reasonable 
                                useful lifetime of the 
                                equipment, as determined by the 
                                Secretary;
                                  (II) payments for oxygen 
                                shall continue to be made in 
                                the amount recognized for 
                                oxygen under paragraph (9) for 
                                the period of medical need; and
                                  (III) maintenance and 
                                servicing payments shall, if 
                                the Secretary determines such 
                                payments are reasonable and 
                                necessary, be made (for parts 
                                and labor not covered by the 
                                supplier's or manufacturer's 
                                warranty, as determined by the 
                                Secretary to be appropriate for 
                                the equipment), and such 
                                payments shall be in an amount 
                                determined to be appropriate by 
                                the Secretary.
          (6) Payment for other covered items (other than 
        durable medical equipment).--Payment for other covered 
        items (other than durable medical equipment and other 
        covered items described in paragraph (3), (4), or (5)) 
        shall be made in a lump-sum amount for the purchase of 
        the item in the amount of the purchase price recognized 
        under paragraph (8).
          (7) Payment for other items of durable medical 
        equipment.--
                  (A) Payment.--In the case of an item of 
                durable medical equipment not described in 
                paragraphs (2) through (6), the following rules 
                shall apply:
                          (i) Rental.--
                                  (I) In general.--Except as 
                                provided in clause (iii), 
                                payment for the item shall be 
                                made on a monthly basis for the 
                                rental of the item during the 
                                period of medical need (but 
                                payments under this clause may 
                                not extend over a period of 
                                continuous use (as determined 
                                by the Secretary) of longer 
                                than 13 months).
                                  (II) Payment amount.--Subject 
                                to subclause (III) and 
                                subparagraph (B), the amount 
                                recognized for the item, for 
                                each of the first 3 months of 
                                such period, is 10 percent of 
                                the purchase price recognized 
                                under paragraph (8) with 
                                respect to the item, and, for 
                                each of the remaining months of 
                                such period, is 7.5 percent of 
                                such purchase price.
                                  (III) Special rule for power-
                                driven wheelchairs.--For 
                                purposes of payment for power-
                                driven wheelchairs, subclause 
                                (II) shall be applied by 
                                substituting ``15 percent'' and 
                                ``6 percent'' for ``10 
                                percent'' and ``7.5 percent'', 
                                respectively.
                          (ii) Ownership after rental.--On the 
                        first day that begins after the 13th 
                        continuous month during which payment 
                        is made for the rental of an item under 
                        clause (i), the supplier of the item 
                        shall transfer title to the item to the 
                        individual.
                          (iii) Purchase agreement option for 
                        complex, rehabilitative power-driven 
                        wheelchairs.--In the case of a complex, 
                        rehabilitative power-driven wheelchair, 
                        at the time the supplier furnishes the 
                        item, the supplier shall offer the 
                        individual the option to purchase the 
                        item, and payment for such item shall 
                        be made on a lump-sum basis if the 
                        individual exercises such option.
                          (iv) Maintenance and servicing.--
                        After the supplier transfers title to 
                        the item under clause (ii) or in the 
                        case of a power-driven wheelchair for 
                        which a purchase agreement has been 
                        entered into under clause (iii), 
                        maintenance and servicing payments 
                        shall, if the Secretary determines such 
                        payments are reasonable and necessary, 
                        be made (for parts and labor not 
                        covered by the supplier's or 
                        manufacturer's warranty, as determined 
                        by the Secretary to be appropriate for 
                        the particular type of durable medical 
                        equipment), and such payments shall be 
                        in an amount determined to be 
                        appropriate by the Secretary.
                  (B) Range for rental amounts.--
                          (i) For 1989.--For items furnished 
                        during 1989, the payment amount 
                        recognized under subparagraph (A)(i) 
                        shall not be more than 115 percent, and 
                        shall not be less than 85 percent, of 
                        the prevailing charge established for 
                        rental of the item in January 1987, 
                        increased by the percentage increase in 
                        the consumer price index for all urban 
                        consumers (U.S. city average) for the 
                        6-month period ending with December 
                        1987.
                          (ii) For 1990.--For items furnished 
                        during 1990, clause (i) shall apply in 
                        the same manner as it applies to items 
                        furnished during 1989.
                  (C) Replacement of items.--
                          (i) Establishment of reasonable 
                        useful lifetime.--In accordance with 
                        clause (iii), the Secretary shall 
                        determine and establish a reasonable 
                        useful lifetime for items of durable 
                        medical equipment for which payment may 
                        be made under this paragraph.
                          (ii) Payment for replacement items.--
                        If the reasonable lifetime of such an 
                        item, as so established, has been 
                        reached during a continuous period of 
                        medical need, or the carrier determines 
                        that the item is lost or irreparably 
                        damaged, the patient may elect to have 
                        payment for an item serving as a 
                        replacement for such item made--
                                  (I) on a monthly basis for 
                                the rental of the replacement 
                                item in accordance with 
                                subparagraph (A); or
                                  (II) in the case of an item 
                                for which a purchase agreement 
                                has been entered into under 
                                subparagraph (A)(iii), in a 
                                lump-sum amount for the 
                                purchase of the item.
                          (iii) Length of reasonable useful 
                        lifetime.--The reasonable useful 
                        lifetime of an item of durable medical 
                        equipment under this subparagraph shall 
                        be equal to 5 years, except that, if 
                        the Secretary determines that, on the 
                        basis of prior experience in making 
                        payments for such an item under this 
                        title, a reasonable useful lifetime of 
                        5 years is not appropriate with respect 
                        to a particular item, the Secretary 
                        shall establish an alternative 
                        reasonable lifetime for such item.
          (8) Purchase price recognized for miscellaneous 
        devices and items.--For purposes of paragraphs (6) and 
        (7), the amount that is recognized under this paragraph 
        as the purchase price for a covered item is the amount 
        described in subparagraph (C) of this paragraph, 
        determined as follows:
                  (A) Computation of local purchase price.--
                Each carrier under section 1842 shall compute a 
                base local purchase price for the item as 
                follows:
                          (i) The carrier shall compute a base 
                        local purchase price, for each item 
                        described--
                                  (I) in paragraph (6) equal to 
                                the average reasonable charge 
                                in the locality for the 
                                purchase of the item for the 
                                12-month period ending with 
                                June 1987, or
                                  (II) in paragraph (7) equal 
                                to the average of the purchase 
                                prices on the claims submitted 
                                on an assignment-related basis 
                                for the unused item supplied 
                                during the 6-month period 
                                ending with December 1986.
                          (ii) The carrier shall compute a 
                        local purchase price, with respect to 
                        the furnishing of each particular 
                        item--
                                  (I) in 1989 and 1990, equal 
                                to the base local purchase 
                                price computed under clause (i) 
                                increased by the percentage 
                                increase in the consumer price 
                                index for all urban consumers 
                                (U.S. city average) for the 6-
                                month period ending with 
                                December 1987,
                                  (II) in 1991, equal to the 
                                local purchase price computed 
                                under this clause for the 
                                previous year, increased by the 
                                covered item update for 1991, 
                                and decreased by the percentage 
                                by which the average of the 
                                reasonable charges for claims 
                                paid for all items described in 
                                paragraph (7) is lower than the 
                                average of the purchase prices 
                                submitted for such items during 
                                the final 9 months of 1988; or
                                  (III) in 1992, 1993, and 1994 
                                equal to the local purchase 
                                price computed under this 
                                clause for the previous year 
                                increased by the covered item 
                                update for the year.
                  (B) Computation of national limited purchase 
                price.--With respect to the furnishing of a 
                particular item in a year, the Secretary shall 
                compute a national limited purchase price--
                          (i) for 1991, equal to the local 
                        purchase price computed under 
                        subparagraph (A)(ii) for the item for 
                        the year, except that such national 
                        limited purchase price may not exceed 
                        100 percent of the weighted average of 
                        all local purchase prices for the item 
                        computed under such subparagraph for 
                        the year, and may not be less than 85 
                        percent of the weighted average of all 
                        local purchase prices for the item 
                        computed under such subparagraph for 
                        the year;
                          (ii) for 1992 and 1993, the amount 
                        determined under this subparagraph for 
                        the preceding year increased by the 
                        covered item update for such subsequent 
                        year;
                          (iii) for 1994, the local purchase 
                        price computed under subparagraph 
                        (A)(ii) for the item for the year, 
                        except that such national limited 
                        purchase price may not exceed 100 
                        percent of the median of all local 
                        purchase prices computed for the item 
                        under such subparagraph for the year 
                        and may not be less than 85 percent of 
                        the median of all local purchase prices 
                        computed under such subparagraph for 
                        the item for the year; and
                          (iv) for each subsequent year, equal 
                        to the amount determined under this 
                        subparagraph for the preceding year 
                        increased by the covered item update 
                        for such subsequent year.
                  (C) Purchase price recognized.--For purposes 
                of paragraphs (6) and (7), the amount that is 
                recognized under this paragraph as the purchase 
                price for each item furnished--
                          (i) in 1989 or 1990, is 100 percent 
                        of the local purchase price computed 
                        under subparagraph (A)(ii)(I);
                          (ii) in 1991, is the sum of (I) 67 
                        percent of the local purchase price 
                        computed under subparagraph (A)(ii)(II) 
                        for 1991, and (II) 33 percent of the 
                        national limited purchase price 
                        computed under subparagraph (B) for 
                        1991;
                          (iii) in 1992, is the sum of (I) 33 
                        percent of the local purchase price 
                        computed under subparagraph 
                        (A)(ii)(III) for 1992, and (II) 67 
                        percent of the national limited 
                        purchase price computed under 
                        subparagraph (B) for 1992; and
                          (iv) in 1993 or a subsequent year, is 
                        the national limited purchase price 
                        computed under subparagraph (B) for 
                        that year.
          (9) Monthly payment amount recognized with respect to 
        oxygen and oxygen equipment.--For purposes of paragraph 
        (5), the amount that is recognized under this paragraph 
        for payment for oxygen and oxygen equipment is the 
        monthly payment amount described in subparagraph (C) of 
        this paragraph. Such amount shall be computed 
        separately (i) for all items of oxygen and oxygen 
        equipment (other than portable oxygen equipment) and 
        (ii) for portable oxygen equipment (each such group 
        referred to in this paragraph as an ``item'').
                  (A) Computation of local monthly payment 
                rate.--Each carrier under this section shall 
                compute a base local payment rate for each item 
                as follows:
                          (i) The carrier shall compute a base 
                        local average monthly payment rate per 
                        beneficiary as an amount equal to (I) 
                        the total reasonable charges for the 
                        item during the 12-month period ending 
                        with December 1986, divided by (II) the 
                        total number of months for all 
                        beneficiaries receiving the item in the 
                        area during the 12-month period for 
                        which the carrier made payment for the 
                        item under this title.
                          (ii) The carrier shall compute a 
                        local average monthly payment rate for 
                        the item applicable--
                                  (I) to 1989 and 1990, equal 
                                to 95 percent of the base local 
                                average monthly payment rate 
                                computed under clause (i) for 
                                the item increased by the 
                                percentage increase in the 
                                consumer price index for all 
                                urban consumers (U.S. city 
                                average) for the 6-month period 
                                ending with December 1987, or
                                  (II) to 1991, 1992, 1993, and 
                                1994 equal to the local average 
                                monthly payment rate computed 
                                under this clause for the item 
                                for the previous year increased 
                                by the covered item increase 
                                for the year.
                  (B) Computation of national limited monthly 
                payment rate.--With respect to the furnishing 
                of an item in a year, the Secretary shall 
                compute a national limited monthly payment rate 
                equal to--
                          (i) for 1991, the local monthly 
                        payment rate computed under 
                        subparagraph (A)(ii)(II) for the item 
                        for the year, except that such national 
                        limited monthly payment rate may not 
                        exceed 100 percent of the weighted 
                        average of all local monthly payment 
                        rates computed for the item under such 
                        subparagraph for the year, and may not 
                        be less than 85 percent of the weighted 
                        average of all local monthly payment 
                        rates computed for the item under such 
                        subparagraph for the year;
                          (ii) for 1992 and 1993, the amount 
                        determined under this subparagraph for 
                        the preceding year increased by the 
                        covered item update for such subsequent 
                        year;
                          (iii) for 1994, the local monthly 
                        payment rate computed under 
                        subparagraph (A)(ii) for the item for 
                        the year, except that such national 
                        limited monthly payment rate may not 
                        exceed 100 percent of the median of all 
                        local monthly payment rates computed 
                        for the item under such subparagraph 
                        for the year and may not be less than 
                        85 percent of the median of all local 
                        monthly payment rates computed for the 
                        item under such subparagraph for the 
                        year;
                          (iv) for 1995, 1996, and 1997, equal 
                        to the amount determined under this 
                        subparagraph for the preceding year 
                        increased by the covered item update 
                        for such subsequent year;
                          (v) for 1998, 75 percent of the 
                        amount determined under this 
                        subparagraph for 1997; and
                          (vi) for 1999 and each subsequent 
                        year, 70 percent of the amount 
                        determined under this subparagraph for 
                        1997.
                  (C) Monthly payment amount recognized.--For 
                purposes of paragraph (5), the amount that is 
                recognized under this paragraph as the base 
                monthly payment amount for each item 
                furnished--
                          (i) in 1989 and in 1990, is 100 
                        percent of the local average monthly 
                        payment rate computed under 
                        subparagraph (A)(ii) for the item;
                          (ii) in 1991, is the sum of (I) 67 
                        percent of the local average monthly 
                        payment rate computed under 
                        subparagraph (A)(ii)(II) for the item 
                        for 1991, and (II) 33 percent of the 
                        national limited monthly payment rate 
                        computed under subparagraph (B)(i) for 
                        the item for 1991;
                          (iii) in 1992, is the sum of (I) 33 
                        percent of the local average monthly 
                        payment rate computed under 
                        subparagraph (A)(ii)(II) for the item 
                        for 1992, and (II) 67 percent of the 
                        national limited monthly payment rate 
                        computed under subparagraph (B)(ii) for 
                        the item for 1992; and
                          (iv) in a subsequent year, is the 
                        national limited monthly payment rate 
                        computed under subparagraph (B) for the 
                        item for that year.
          (10) Exceptions and adjustments.--
                  (A) Areas outside continental united 
                states.--Exceptions to the amounts recognized 
                under the previous provisions of this 
                subsection shall be made to take into account 
                the unique circumstances of covered items 
                furnished in Alaska, Hawaii, or Puerto Rico.
                  (B) Adjustment for inherent reasonableness.--
                The Secretary is authorized to apply the 
                provisions of paragraphs (8) and (9) of section 
                1842(b) to covered items and suppliers of such 
                items and payments under this subsection in an 
                area and with respect to covered items and 
                services for which the Secretary does not make 
                a payment amount adjustment under paragraph 
                (1)(F).
                  (C) Transcutaneous electrical nerve 
                stimulator (tens).--In order to permit an 
                attending physician time to determine whether 
                the purchase of a transcutaneous electrical 
                nerve stimulator is medically appropriate for a 
                particular patient, the Secretary may determine 
                an appropriate payment amount for the initial 
                rental of such item for a period of not more 
                than 2 months. If such item is subsequently 
                purchased, the payment amount with respect to 
                such purchase is the payment amount determined 
                under paragraph (2).
          (11) Improper billing and requirement of physician 
        order.--
                  (A) Improper billing for certain rental 
                items.--Notwithstanding any other provision of 
                this title, a supplier of a covered item for 
                which payment is made under this subsection and 
                which is furnished on a rental basis shall 
                continue to supply the item without charge 
                (other than a charge provided under this 
                subsection for the maintenance and servicing of 
                the item) after rental payments may no longer 
                be made under this subsection. If a supplier 
                knowingly and willfully violates the previous 
                sentence, the Secretary may apply sanctions 
                against the supplier under section 1842(j)(2) 
                in the same manner such sanctions may apply 
                with respect to a physician.
                  (B) Requirement of physician order.--
                          (i) In general.--The Secretary is 
                        authorized to require, for specified 
                        covered items, that payment may be made 
                        under this subsection with respect to 
                        the item only if a physician enrolled 
                        under section 1866(j) or an eligible 
                        professional under section 
                        1848(k)(3)(B) that is enrolled under 
                        section 1866(j) has communicated to the 
                        supplier, before delivery of the item, 
                        a written order for the item.
                          (ii) Requirement for face to face 
                        encounter.--The Secretary shall require 
                        that such an order be written pursuant 
                        to a physician, a physician assistant, 
                        a nurse practitioner, or a clinical 
                        nurse specialist (as those terms are 
                        defined in section 1861(aa)(5)) 
                        documenting such physician, physician 
                        assistant, practitioner, or specialist 
                        has had a face-to-face encounter 
                        (including through use of telehealth 
                        under subsection (m) and other than 
                        with respect to encounters that are 
                        incident to services involved) with the 
                        individual involved during the 6-month 
                        period preceding such written order, or 
                        other reasonable timeframe as 
                        determined by the Secretary.
          (12) Regional carriers.--The Secretary may designate, 
        by regulation under section 1842, one carrier for one 
        or more entire regions to process all claims within the 
        region for covered items under this section.
          (13) Covered item.--In this subsection, the term 
        ``covered item'' means durable medical equipment (as 
        defined in section 1861(n)), including such equipment 
        described in section 1861(m)(5), but not including 
        implantable items for which payment may be made under 
        section 1833(t).
          (14) Covered item update.--In this subsection, the 
        term ``covered item update'' means, with respect to a 
        year--
                  (A) for 1991 and 1992, the percentage 
                increase in the consumer price index for all 
                urban consumers (U.S. city average) for the 12-
                month period ending with June of the previous 
                year reduced by 1 percentage point;
                  (B) for 1993, 1994, 1995, 1996, and 1997, the 
                percentage increase in the consumer price index 
                for all urban consumers (U.S. city average) for 
                the 12-month period ending with June of the 
                previous year;
                  (C) for each of the years 1998 through 2000, 
                0 percentage points;
                  (D) for 2001, the percentage increase in the 
                consumer price index for all urban consumers 
                (U.S. city average) for the 12-month period 
                ending with June 2000;
                  (E) for 2002, 0 percentage points;
                  (F) for 2003, the percentage increase in the 
                consumer price index for all urban consumers 
                (U.S. urban average) for the 12-month period 
                ending with June of 2002;
                  (G) for 2004 through 2006--
                          (i) subject to clause (ii), in the 
                        case of class III medical devices 
                        described in section 513(a)(1)(C) of 
                        the Federal Food, Drug, and Cosmetic 
                        Act (21 U.S.C. 360(c)(1)(C)), the 
                        percentage increase described in 
                        subparagraph (B) for the year involved; 
                        and
                          (ii) in the case of covered items not 
                        described in clause (i), 0 percentage 
                        points;
                  (H) for 2007--
                          (i) subject to clause (ii), in the 
                        case of class III medical devices 
                        described in section 513(a)(1)(C) of 
                        the Federal Food, Drug, and Cosmetic 
                        Act (21 U.S.C. 360(c)(1)(C)), the 
                        percentage change determined by the 
                        Secretary to be appropriate taking into 
                        account recommendations contained in 
                        the report of the Comptroller General 
                        of the United States under section 
                        302(c)(1)(B) of the Medicare 
                        Prescription Drug, Improvement, and 
                        Modernization Act of 2003; and
                          (ii) in the case of covered items not 
                        described in clause (i), 0 percentage 
                        points;
                  (I) for 2008--
                          (i) subject to clause (ii), in the 
                        case of class III medical devices 
                        described in section 513(a)(1)(C) of 
                        the Federal Food, Drug, and Cosmetic 
                        Act (21 U.S.C. 360(c)(1)(C)), the 
                        percentage increase described in 
                        subparagraph (B) (as applied to the 
                        payment amount for 2007 determined 
                        after the application of the percentage 
                        change under subparagraph (H)(i)); and
                          (ii) in the case of covered items not 
                        described in clause (i), 0 percentage 
                        points;
                  (J) for 2009--
                          (i) in the case of items and services 
                        furnished in any geographic area, if 
                        such items or services were selected 
                        for competitive acquisition in any area 
                        under the competitive acquisition 
                        program under section 
                        1847(a)(1)(B)(i)(I) before July 1, 
                        2008, including related accessories but 
                        only if furnished with such items and 
                        services selected for such competition 
                        and diabetic supplies but only if 
                        furnished through mail order, - 9.5 
                        percent; or
                          (ii) in the case of other items and 
                        services, the percentage increase in 
                        the consumer price index for all urban 
                        consumers (U.S. urban average) for the 
                        12-month period ending with June 2008;
                  (K) for 2010, the percentage increase in the 
                consumer price index for all urban consumers 
                (U.S. urban average) for the 12-month period 
                ending with June of the previous year; and
                  (L) for 2011 and each subsequent year--
                          (i) the percentage increase in the 
                        consumer price index for all urban 
                        consumers (United States city average) 
                        for the 12-month period ending with 
                        June of the previous year, reduced by--
                          (ii) the productivity adjustment 
                        described in section 
                        1886(b)(3)(B)(xi)(II).
        The application of subparagraph (L)(ii) may result in 
        the covered item update under this paragraph being less 
        than 0.0 for a year, and may result in payment rates 
        under this subsection for a year being less than such 
        payment rates for the preceding year.
          (15) Advance determinations of coverage for certain 
        items.--
                  (A) Development of lists of items by 
                secretary.--The Secretary may develop and 
                periodically update a list of items for which 
                payment may be made under this subsection that 
                the Secretary determines, on the basis of prior 
                payment experience, are frequently subject to 
                unnecessary utilization throughout a carrier's 
                entire service area or a portion of such area.
                  (B) Development of lists of suppliers by 
                secretary.--The Secretary may develop and 
                periodically update a list of suppliers of 
                items for which payment may be made under this 
                subsection with respect to whom--
                          (i) the Secretary has found that a 
                        substantial number of claims for 
                        payment under this part for items 
                        furnished by the supplier have been 
                        denied on the basis of the application 
                        of section 1862(a)(1); or
                          (ii) the Secretary has identified a 
                        pattern of overutilization resulting 
                        from the business practice of the 
                        supplier.
                  (C) Determinations of coverage in advance.--A 
                carrier shall determine in advance of delivery 
                of an item whether payment for the item may not 
                be made because the item is not covered or 
                because of the application of section 
                1862(a)(1) if--
                          (i) the item is included on the list 
                        developed by the Secretary under 
                        subparagraph (A);
                          (ii) the item is furnished by a 
                        supplier included on the list developed 
                        by the Secretary under subparagraph 
                        (B); or
                          (iii) the item is a customized item 
                        (other than inexpensive items specified 
                        by the Secretary) and the patient to 
                        whom the item is to be furnished or the 
                        supplier requests that such advance 
                        determination be made.
          (16) Disclosure of information and surety bond.--The 
        Secretary shall not provide for the issuance (or 
        renewal) of a provider number for a supplier of durable 
        medical equipment, for purposes of payment under this 
        part for durable medical equipment furnished by the 
        supplier, unless the supplier provides the Secretary on 
        a continuing basis--
                  (A) with--
                          (i) full and complete information as 
                        to the identity of each person with an 
                        ownership or control interest (as 
                        defined in section 1124(a)(3)) in the 
                        supplier or in any subcontractor (as 
                        defined by the Secretary in 
                        regulations) in which the supplier 
                        directly or indirectly has a 5 percent 
                        or more ownership interest; and
                          (ii) to the extent determined to be 
                        feasible under regulations of the 
                        Secretary, the name of any disclosing 
                        entity (as defined in section 
                        1124(a)(2)) with respect to which a 
                        person with such an ownership or 
                        control interest in the supplier is a 
                        person with such an ownership or 
                        control interest in the disclosing 
                        entity; and
                  (B) with a surety bond in a form specified by 
                the Secretary and in an amount that is not less 
                than $50,000 that the Secretary determines is 
                commensurate with the volume of the billing of 
                the supplier.
        The Secretary may waive the requirement of a bond under 
        subparagraph (B) in the case of a supplier that 
        provides a comparable surety bond under State law. The 
        Secretary, at the Secretary's discretion, may impose 
        the requirements of the first sentence with respect to 
        some or all providers of items or services under part A 
        or some or all suppliers or other persons (other than 
        physicians or other practitioners, as defined in 
        section 1842(b)(18)(C)) who furnish items or services 
        under this part.
          (17) Prohibition against unsolicited telephone 
        contacts by suppliers.--
                  (A) In general.--A supplier of a covered item 
                under this subsection may not contact an 
                individual enrolled under this part by 
                telephone regarding the furnishing of a covered 
                item to the individual unless 1 of the 
                following applies:
                          (i) The individual has given written 
                        permission to the supplier to make 
                        contact by telephone regarding the 
                        furnishing of a covered item.
                          (ii) The supplier has furnished a 
                        covered item to the individual and the 
                        supplier is contacting the individual 
                        only regarding the furnishing of such 
                        covered item.
                          (iii) If the contact is regarding the 
                        furnishing of a covered item other than 
                        a covered item already furnished to the 
                        individual, the supplier has furnished 
                        at least 1 covered item to the 
                        individual during the 15-month period 
                        preceding the date on which the 
                        supplier makes such contact.
                  (B) Prohibiting payment for items furnished 
                subsequent to unsolicited contacts.--If a 
                supplier knowingly contacts an individual in 
                violation of subparagraph (A), no payment may 
                be made under this part for any item 
                subsequently furnished to the individual by the 
                supplier.
                  (C) Exclusion from program for suppliers 
                engaging in pattern of unsolicited contacts.--
                If a supplier knowingly contacts individuals in 
                violation of subparagraph (A) to such an extent 
                that the supplier's conduct establishes a 
                pattern of contacts in violation of such 
                subparagraph, the Secretary shall exclude the 
                supplier from participation in the programs 
                under this Act, in accordance with the 
                procedures set forth in subsections (c), (f), 
                and (g) of section 1128.
          (18) Refund of amounts collected for certain 
        disallowed items.--
                  (A) In general.--If a nonparticipating 
                supplier furnishes to an individual enrolled 
                under this part a covered item for which no 
                payment may be made under this part by reason 
                of paragraph (17)(B), the supplier shall refund 
                on a timely basis to the patient (and shall be 
                liable to the patient for) any amounts 
                collected from the patient for the item, 
                unless--
                          (i) the supplier establishes that the 
                        supplier did not know and could not 
                        reasonably have been expected to know 
                        that payment may not be made for the 
                        item by reason of paragraph (17)(B), or
                          (ii) before the item was furnished, 
                        the patient was informed that payment 
                        under this part may not be made for 
                        that item and the patient has agreed to 
                        pay for that item.
                  (B) Sanctions.--If a supplier knowingly and 
                willfully fails to make refunds in violation of 
                subparagraph (A), the Secretary may apply 
                sanctions against the supplier in accordance 
                with section 1842(j)(2).
                  (C) Notice.--Each carrier with a contract in 
                effect under this part with respect to 
                suppliers of covered items shall send any 
                notice of denial of payment for covered items 
                by reason of paragraph (17)(B) and for which 
                payment is not requested on an assignment-
                related basis to the supplier and the patient 
                involved.
                  (D) Timely basis defined.--A refund under 
                subparagraph (A) is considered to be on a 
                timely basis only if--
                          (i) in the case of a supplier who 
                        does not request reconsideration or 
                        seek appeal on a timely basis, the 
                        refund is made within 30 days after the 
                        date the supplier receives a denial 
                        notice under subparagraph (C), or
                          (ii) in the case in which such a 
                        reconsideration or appeal is taken, the 
                        refund is made within 15 days after the 
                        date the supplier receives notice of an 
                        adverse determination on 
                        reconsideration or appeal.
          (19) Certain upgraded items.--
                  (A) Individual's right to choose upgraded 
                item.--Notwithstanding any other provision of 
                this title, the Secretary may issue regulations 
                under which an individual may purchase or rent 
                from a supplier an item of upgraded durable 
                medical equipment for which payment would be 
                made under this subsection if the item were a 
                standard item.
                  (B) Payments to supplier.--In the case of the 
                purchase or rental of an upgraded item under 
                subparagraph (A)--
                          (i) the supplier shall receive 
                        payment under this subsection with 
                        respect to such item as if such item 
                        were a standard item; and
                          (ii) the individual purchasing or 
                        renting the item shall pay the supplier 
                        an amount equal to the difference 
                        between the supplier's charge and the 
                        amount under clause (i).
                In no event may the supplier's charge for an 
                upgraded item exceed the applicable fee 
                schedule amount (if any) for such item.
                  (C) Consumer protection safeguards.--Any 
                regulations under subparagraph (A) shall 
                provide for consumer protection standards with 
                respect to the furnishing of upgraded equipment 
                under subparagraph (A). Such regulations shall 
                provide for--
                          (i) determination of fair market 
                        prices with respect to an upgraded 
                        item;
                          (ii) full disclosure of the 
                        availability and price of standard 
                        items and proof of receipt of such 
                        disclosure information by the 
                        beneficiary before the furnishing of 
                        the upgraded item;
                          (iii) conditions of participation for 
                        suppliers in the billing arrangement;
                          (iv) sanctions of suppliers who are 
                        determined to engage in coercive or 
                        abusive practices, including exclusion; 
                        and
                          (v) such other safeguards as the 
                        Secretary determines are necessary.
          (20) Identification of quality standards.--
                  (A) In general.--Subject to subparagraph (C), 
                the Secretary shall establish and implement 
                quality standards for suppliers of items and 
                services described in subparagraph (D) to be 
                applied by recognized independent accreditation 
                organizations (as designated under subparagraph 
                (B)) and with which such suppliers shall be 
                required to comply in order to--
                          (i) furnish any such item or service 
                        for which payment is made under this 
                        part; and
                          (ii) receive or retain a provider or 
                        supplier number used to submit claims 
                        for reimbursement for any such item or 
                        service for which payment may be made 
                        under this title.
                  (B) Designation of independent accreditation 
                organizations.--Not later than the date that is 
                1 year after the date on which the Secretary 
                implements the quality standards under 
                subparagraph (A), notwithstanding section 
                1865(a), the Secretary shall designate and 
                approve one or more independent accreditation 
                organizations for purposes of such 
                subparagraph.
                  (C) Quality standards.--The quality standards 
                described in subparagraph (A) may not be less 
                stringent than the quality standards that would 
                otherwise apply if this paragraph did not apply 
                and shall include consumer services standards.
                  (D) Items and services described.--The items 
                and services described in this subparagraph are 
                the following items and services, as the 
                Secretary determines appropriate:
                          (i) Covered items (as defined in 
                        paragraph (13)) for which payment may 
                        otherwise be made under this 
                        subsection.
                          (ii) Prosthetic devices and orthotics 
                        and prosthetics described in section 
                        1834(h)(4).
                          (iii) Items and services described in 
                        section 1842(s)(2).
                  (E) Implementation.--The Secretary may 
                establish by program instruction or otherwise 
                the quality standards under this paragraph, 
                including subparagraph (F), after consultation 
                with representatives of relevant parties. Such 
                standards shall be applied prospectively and 
                shall be published on the Internet website of 
                the Centers for Medicare & Medicaid Services.
                  (F) Application of accreditation 
                requirement.--In implementing quality standards 
                under this paragraph--
                          (i) subject to clause (ii) and 
                        subparagraph (G), the Secretary shall 
                        require suppliers furnishing items and 
                        services described in subparagraph (D) 
                        on or after October 1, 2009, directly 
                        or as a subcontractor for another 
                        entity, to have submitted to the 
                        Secretary evidence of accreditation by 
                        an accreditation organization 
                        designated under subparagraph (B) as 
                        meeting applicable quality standards, 
                        except that the Secretary shall not 
                        require under this clause pharmacies to 
                        obtain such accreditation before 
                        January 1, 2010, except that the 
                        Secretary shall not require a pharmacy 
                        to have submitted to the Secretary such 
                        evidence of accreditation prior to 
                        January 1, 2011; and
                          (ii) in applying such standards and 
                        the accreditation requirement of clause 
                        (i) with respect to eligible 
                        professionals (as defined in section 
                        1848(k)(3)(B)), and including such 
                        other persons, such as orthotists and 
                        prosthetists, as specified by the 
                        Secretary, furnishing such items and 
                        services--
                                  (I) such standards and 
                                accreditation requirement shall 
                                not apply to such professionals 
                                and persons unless the 
                                Secretary determines that the 
                                standards being applied are 
                                designed specifically to be 
                                applied to such professionals 
                                and persons; and
                                  (II) the Secretary may exempt 
                                such professionals and persons 
                                from such standards and 
                                requirement if the Secretary 
                                determines that licensing, 
                                accreditation, or other 
                                mandatory quality requirements 
                                apply to such professionals and 
                                persons with respect to the 
                                furnishing of such items and 
                                services.
                  (G) Application of accreditation requirement 
                to certain pharmacies.--
                          (i) In general.--With respect to 
                        items and services furnished on or 
                        after January 1, 2011, in implementing 
                        quality standards under this 
                        paragraph--
                                  (I) subject to subclause 
                                (II), in applying such 
                                standards and the accreditation 
                                requirement of subparagraph 
                                (F)(i) with respect to 
                                pharmacies described in clause 
                                (ii) furnishing such items and 
                                services, such standards and 
                                accreditation requirement shall 
                                not apply to such pharmacies; 
                                and
                                  (II) the Secretary may apply 
                                to such pharmacies an 
                                alternative accreditation 
                                requirement established by the 
                                Secretary if the Secretary 
                                determines such alternative 
                                accreditation requirement is 
                                more appropriate for such 
                                pharmacies.
                          (ii) Pharmacies described.--A 
                        pharmacy described in this clause is a 
                        pharmacy that meets each of the 
                        following criteria:
                                  (I) The total billings by the 
                                pharmacy for such items and 
                                services under this title are 
                                less than 5 percent of total 
                                pharmacy sales, as determined 
                                based on the average total 
                                pharmacy sales for the previous 
                                3 calendar years, 3 fiscal 
                                years, or other yearly period 
                                specified by the Secretary.
                                  (II) The pharmacy has been 
                                enrolled under section 1866(j) 
                                as a supplier of durable 
                                medical equipment, prosthetics, 
                                orthotics, and supplies, has 
                                been issued (which may include 
                                the renewal of) a provider 
                                number for at least 5 years, 
                                and for which a final adverse 
                                action (as defined in section 
                                424.57(a) of title 42, Code of 
                                Federal Regulations) has not 
                                been imposed in the past 5 
                                years.
                                  (III) The pharmacy submits to 
                                the Secretary an attestation, 
                                in a form and manner, and at a 
                                time, specified by the 
                                Secretary, that the pharmacy 
                                meets the criteria described in 
                                subclauses (I) and (II). Such 
                                attestation shall be subject to 
                                section 1001 of title 18, 
                                United States Code.
                                  (IV) The pharmacy agrees to 
                                submit materials as requested 
                                by the Secretary, or during the 
                                course of an audit conducted on 
                                a random sample of pharmacies 
                                selected annually, to verify 
                                that the pharmacy meets the 
                                criteria described in 
                                subclauses (I) and (II). 
                                Materials submitted under the 
                                preceding sentence shall 
                                include a certification by an 
                                accountant on behalf of the 
                                pharmacy or the submission of 
                                tax returns filed by the 
                                pharmacy during the relevant 
                                periods, as requested by the 
                                Secretary.
          (21) Special payment rule for specified items and 
        supplies.--
                  (A) In general.--Notwithstanding the 
                preceding provisions of this subsection, for 
                specified items and supplies (described in 
                subparagraph (B)) furnished during 2005, the 
                payment amount otherwise determined under this 
                subsection for such specified items and 
                supplies shall be reduced by the percentage 
                difference between--
                          (i) the amount of payment otherwise 
                        determined for the specified item or 
                        supply under this subsection for 2002, 
                        and
                          (ii) the amount of payment for the 
                        specified item or supply under chapter 
                        89 of title 5, United States Code, as 
                        identified in the column entitled 
                        ``Median FEHP Price'' in the table 
                        entitled ``SUMMARY OF MEDICARE PRICES 
                        COMPARED TO VA, MEDICAID, RETAIL, AND 
                        FEHP PRICES FOR 16 ITEMS'' included in 
                        the Testimony of the Inspector General 
                        before the Senate Committee on 
                        Appropriations, June 12, 2002, or any 
                        subsequent report by the Inspector 
                        General.
                  (B) Specified item or supply described.--For 
                purposes of subparagraph (A), a specified item 
                or supply means oxygen and oxygen equipment, 
                standard wheelchairs (including standard power 
                wheelchairs), nebulizers, diabetic supplies 
                consisting of lancets and testing strips, 
                hospital beds, and air mattresses, but only if 
                the HCPCS code for the item or supply is 
                identified in a table referred to in 
                subparagraph (A)(ii).
                  (C) Application of update to special payment 
                amount.--The covered item update under 
                paragraph (14) for specified items and supplies 
                for 2006 and each subsequent year shall be 
                applied to the payment amount under 
                subparagraph (A) unless payment is made for 
                such items and supplies under section 1847.
          (22) Special payment rule for diabetic supplies.--
        Notwithstanding the preceding provisions of this 
        subsection, for purposes of determining the payment 
        amount under this subsection for diabetic supplies 
        furnished on or after the first day of the calendar 
        quarter during 2013 that is at least 30 days after the 
        date of the enactment of this paragraph and before the 
        date described in paragraph (1)(H)(ii), the Secretary 
        shall recalculate and apply the covered item update 
        under paragraph (14) as if subparagraph (J)(i) of such 
        paragraph was amended by striking ``but only if 
        furnished through mail order''.
  (b) Fee Schedules for Radiologist Services.--
          (1) Development.--The Secretary shall develop--
                  (A) a relative value scale to serve as the 
                basis for the payment for radiologist services 
                under this part, and
                  (B) using such scale and appropriate 
                conversion factors and subject to subsection 
                (c)(1)(A), fee schedules (on a regional, 
                statewide, locality, or carrier service area 
                basis) for payment for radiologist services 
                under this part, to be implemented for such 
                services furnished during 1989.
          (2) Consultation.--In carrying out paragraph (1), the 
        Secretary shall regularly consult closely with the 
        Physician Payment Review Commission, the American 
        College of Radiology, and other organizations 
        representing physicians or suppliers who furnish 
        radiologist services and shall share with them the data 
        and data analysis being used to make the determinations 
        under paragraph (1), including data on variations in 
        current medicare payments by geographic area, and by 
        service and physician specialty.
          (3) Considerations.--In developing the relative value 
        scale and fee schedules under paragraph (1), the 
        Secretary--
                  (A) shall take into consideration variations 
                in the cost of furnishing such services among 
                geographic areas and among different sites 
                where services are furnished, and
                  (B) may also take into consideration such 
                other factors respecting the manner in which 
                physicians in different specialties furnish 
                such services as may be appropriate to assure 
                that payment amounts are equitable and designed 
                to promote effective and efficient provision of 
                radiologist services by physicians in the 
                different specialties.
          (4) Savings.--
                  (A) Budget neutral fee schedules.--The 
                Secretary shall develop preliminary fee 
                schedules for 1989, which are designed to 
                result in the same amount of aggregate payments 
                (net of any coinsurance and deductibles under 
                sections 1833(a)(1)(J) and 1833(b)) for 
                radiologist services furnished in 1989 as would 
                have been made if this subsection had not been 
                enacted.
                  (B) Initial savings.--The fee schedules 
                established for payment purposes under this 
                subsection for services furnished in 1989 shall 
                be 97 percent of the amounts permitted under 
                these preliminary fee schedules developed under 
                subparagraph (A).
                  (C)  1990 fee schedules.--For radiologist 
                services (other than portable X-ray services) 
                furnished under this part during 1990, after 
                March 31 of such year, the conversion factors 
                used under this subsection shall be 96 percent 
                of the conversion factors that applied under 
                this subsection as of December 31, 1989.
                  (D)  1991 fee schedules.--For radiologist 
                services (other than portable X-ray services) 
                furnished under this part during 1991, the 
                conversion factors used in a locality under 
                this subsection shall, subject to clause (vii), 
                be reduced to the adjusted conversion factor 
                for the locality determined as follows:
                          (i) National weighted average 
                        conversion factor.--The Secretary shall 
                        estimate the national weighted average 
                        of the conversion factors used under 
                        this subsection for services furnished 
                        during 1990 beginning on April 1, using 
                        the best available data.
                          (ii) Reduced national weighted 
                        average.--The national weighted average 
                        estimated under clause (i) shall be 
                        reduced by 13 percent.
                          (iii) Computation of 1990 locality 
                        index relative to national average.--
                        The Secretary shall establish an index 
                        which reflects, for each locality, the 
                        ratio of the conversion factor used in 
                        the locality under this subsection to 
                        the national weighted average estimated 
                        under clause (i).
                          (iv) Adjusted conversion factor.--The 
                        adjusted conversion factor for the 
                        professional or technical component of 
                        a service in a locality is the sum of 
                        \1/2\ of the locally-adjusted amount 
                        determined under clause (v) and \1/2\ 
                        of the GPCI-adjusted amount determined 
                        under clause (vi).
                          (v) Locally-adjusted amount.--For 
                        purposes of clause (iv), the locally 
                        adjusted amount determined under this 
                        clause is the product of (I) the 
                        national weighted average conversion 
                        factor computed under clause (ii), and 
                        (II) the index value established under 
                        clause (iii) for the locality.
                          (vi) GPCI-adjusted amount.--For 
                        purposes of clause (iv), the GPCI-
                        adjusted amount determined under this 
                        clause is the sum of--
                                  (I) the product of (a) the 
                                portion of the reduced national 
                                weighted average conversion 
                                factor computed under clause 
                                (ii) which is attributable to 
                                physician work and (b) the 
                                geographic work index value for 
                                the locality (specified in 
                                Addendum C to the Model Fee 
                                Schedule for Physician Services 
                                (published on September 4, 
                                1990, 55 Federal Register pp. 
                                36238-36243)); and
                                  (II) the product of (a) the 
                                remaining portion of the 
                                reduced national weighted 
                                average conversion factor 
                                computed under clause (ii), and 
                                (b) the geographic practice 
                                cost index value specified in 
                                section 1842(b)(14)(C)(iv) for 
                                the locality.
                        In applying this clause with respect to 
                        the professional component of a 
                        service, 80 percent of the conversion 
                        factor shall be considered to be 
                        attributable to physician work and with 
                        respect to the technical component of 
                        the service, 0 percent shall be 
                        considered to be attributable to 
                        physician work.
                          (vii) Limits on conversion factor.--
                        The conversion factor to be applied to 
                        a locality to the professional or 
                        technical component of a service shall 
                        not be reduced under this subparagraph 
                        by more than 9.5 percent below the 
                        conversion factor applied in the 
                        locality under subparagraph (C) to such 
                        component, but in no case shall the 
                        conversion factor be less than 60 
                        percent of the national weighted 
                        average of the conversion factors 
                        (computed under clause (i)).
                  (E) Rule for certain scanning services.--In 
                the case of the technical components of 
                magnetic resonance imaging (MRI) services and 
                computer assisted tomography (CAT) services 
                furnished after December 31, 1990, the amount 
                otherwise payable shall be reduced by 10 
                percent.
                  (F) Subsequent updating.--For radiologist 
                services furnished in subsequent years, the fee 
                schedules shall be the schedules for the 
                previous year updated by the percentage 
                increase in the MEI (as defined in section 
                1842(i)(3)) for the year.
                  (G) Nonparticipating physicians and 
                suppliers.--Each fee schedule so established 
                shall provide that the payment rate recognized 
                for nonparticipating physicians and suppliers 
                is equal to the appropriate percent (as defined 
                in section 1842(b)(4)(A)(iv)) of the payment 
                rate recognized for participating physicians 
                and suppliers.
          (5) Limiting charges of nonparticipating physicians 
        and suppliers.--
                  (A) In general.--In the case of radiologist 
                services furnished after January 1, 1989, for 
                which payment is made under a fee schedule 
                under this subsection, if a nonparticipating 
                physician or supplier furnishes the service to 
                an individual entitled to benefits under this 
                part, the physician or supplier may not charge 
                the individual more than the limiting charge 
                (as defined in subparagraph (B)).
                  (B) Limiting charge defined.--In subparagraph 
                (A), the term ``limiting charge'' means, with 
                respect to a service furnished--
                          (i) in 1989, 125 percent of the 
                        amount specified for the service in the 
                        appropriate fee schedule established 
                        under paragraph (1),
                          (ii) in 1990, 120 percent of the 
                        amount specified for the service in the 
                        appropriate fee schedule established 
                        under paragraph (1), and
                          (iii) after 1990, 115 percent of the 
                        amount specified for the service in the 
                        appropriate fee schedule established 
                        under paragraph (1).
                  (C) Enforcement.--If a physician or supplier 
                knowingly and willfully bills in violation of 
                subparagraph (A), the Secretary may apply 
                sanctions against such physician or supplier in 
                accordance with section 1842(j)(2) in the same 
                manner as such sanctions may apply to a 
                physician.
          (6) Radiologist services defined.--For the purposes 
        of this subsection and section 1833(a)(1)(J), the term 
        ``radiologist services'' only includes radiology 
        services performed by, or under the direction or 
        supervision of, a physician--
                  (A) who is certified, or eligible to be 
                certified, by the American Board of Radiology, 
                or
                  (B) for whom radiology services account for 
                at least 50 percent of the total amount of 
                charges made under this part.
  (c) Payment and Standards for Screening Mammography.--
          (1) In general.--With respect to expenses incurred 
        for screening mammography (as defined in section 
        1861(jj)), payment may be made only--
                  (A) for screening mammography conducted 
                consistent with the frequency permitted under 
                paragraph (2); and
                  (B) if the screening mammography is conducted 
                by a facility that has a certificate (or 
                provisional certificate) issued under section 
                354 of the Public Health Service Act.
          (2) Frequency covered.--
                  (A) In general.--Subject to revision by the 
                Secretary under subparagraph (B)--
                          (i) no payment may be made under this 
                        part for screening mammography 
                        performed on a woman under 35 years of 
                        age;
                          (ii) payment may be made under this 
                        part for only one screening mammography 
                        performed on a woman over 34 years of 
                        age, but under 40 years of age; and
                          (iii) in the case of a woman over 39 
                        years of age, payment may not be made 
                        under this part for screening 
                        mammography performed within 11 months 
                        following the month in which a previous 
                        screening mammography was performed.
                  (B) Revision of frequency.--
                          (i) Review.--The Secretary, in 
                        consultation with the Director of the 
                        National Cancer Institute, shall review 
                        periodically the appropriate frequency 
                        for performing screening mammography, 
                        based on age and such other factors as 
                        the Secretary believes to be pertinent.
                          (ii) Revision of frequency.--The 
                        Secretary, taking into consideration 
                        the review made under clause (i), may 
                        revise from time to time the frequency 
                        with which screening mammography may be 
                        paid for under this subsection.
  (d) Frequency Limits and Payment for Colorectal Cancer 
Screening Tests.--
          (1) Screening fecal-occult blood tests.--
                  (A) Payment amount.--The payment amount for 
                colorectal cancer screening tests consisting of 
                screening fecal-occult blood tests is equal to 
                the payment amount established for diagnostic 
                fecal-occult blood tests under section 1833(h).
                  (B) Frequency limit.--No payment may be made 
                under this part for a colorectal cancer 
                screening test consisting of a screening fecal-
                occult blood test--
                          (i) if the individual is under 50 
                        years of age; or
                          (ii) if the test is performed within 
                        the 11 months after a previous 
                        screening fecal-occult blood test.
          (2) Screening flexible sigmoidoscopies.--
                  (A) Fee schedule.--With respect to colorectal 
                cancer screening tests consisting of screening 
                flexible sigmoidoscopies, payment under section 
                1848 shall be consistent with payment under 
                such section for similar or related services.
                  (B) Payment limit.--In the case of screening 
                flexible sigmoidoscopy services, payment under 
                this part shall not exceed such amount as the 
                Secretary specifies, based upon the rates 
                recognized for diagnostic flexible 
                sigmoidoscopy services.
                  (C) Facility payment limit.--
                          (i) In general.--Notwithstanding 
                        subsections (i)(2)(A) and (t) of 
                        section 1833, in the case of screening 
                        flexible sigmoidoscopy services 
                        furnished on or after January 1, 1999, 
                        that--
                                  (I) in accordance with 
                                regulations, may be performed 
                                in an ambulatory surgical 
                                center and for which the 
                                Secretary permits ambulatory 
                                surgical center payments under 
                                this part, and
                                  (II) are performed in an 
                                ambulatory surgical center or 
                                hospital outpatient department,
                        payment under this part shall be based 
                        on the lesser of the amount under the 
                        fee schedule that would apply to such 
                        services if they were performed in a 
                        hospital outpatient department in an 
                        area or the amount under the fee 
                        schedule that would apply to such 
                        services if they were performed in an 
                        ambulatory surgical center in the same 
                        area.
                          (ii) Limitation on coinsurance.--
                        Notwithstanding any other provision of 
                        this title, in the case of a 
                        beneficiary who receives the services 
                        described in clause (i)--
                                  (I) in computing the amount 
                                of any applicable copayment, 
                                the computation of such 
                                coinsurance shall be based upon 
                                the fee schedule under which 
                                payment is made for the 
                                services, and
                                  (II) the amount of such 
                                coinsurance is equal to 25 
                                percent of the payment amount 
                                under the fee schedule 
                                described in subclause (I).
                  (D) Special rule for detected lesions.--If 
                during the course of such screening flexible 
                sigmoidoscopy, a lesion or growth is detected 
                which results in a biopsy or removal of the 
                lesion or growth, payment under this part shall 
                not be made for the screening flexible 
                sigmoidoscopy but shall be made for the 
                procedure classified as a flexible 
                sigmoidoscopy with such biopsy or removal.
                  (E) Frequency limit.--No payment may be made 
                under this part for a colorectal cancer 
                screening test consisting of a screening 
                flexible sigmoidoscopy--
                          (i) if the individual is under 50 
                        years of age; or
                          (ii) if the procedure is performed 
                        within the 47 months after a previous 
                        screening flexible sigmoidoscopy or, in 
                        the case of an individual who is not at 
                        high risk for colorectal cancer, if the 
                        procedure is performed within the 119 
                        months after a previous screening 
                        colonoscopy.
          (3) Screening colonoscopy.--
                  (A) Fee schedule.--With respect to colorectal 
                cancer screening test consisting of a screening 
                colonoscopy, payment under section 1848 shall 
                be consistent with payment amounts under such 
                section for similar or related services.
                  (B) Payment limit.--In the case of screening 
                colonoscopy services, payment under this part 
                shall not exceed such amount as the Secretary 
                specifies, based upon the rates recognized for 
                diagnostic colonoscopy services.
                  (C) Facility payment limit.--
                          (i) In general.--Notwithstanding 
                        subsections (i)(2)(A) and (t) of 
                        section 1833, in the case of screening 
                        colonoscopy services furnished on or 
                        after January 1, 1999, that are 
                        performed in an ambulatory surgical 
                        center or a hospital outpatient 
                        department, payment under this part 
                        shall be based on the lesser of the 
                        amount under the fee schedule that 
                        would apply to such services if they 
                        were performed in a hospital outpatient 
                        department in an area or the amount 
                        under the fee schedule that would apply 
                        to such services if they were performed 
                        in an ambulatory surgical center in the 
                        same area.
                          (ii) Limitation on coinsurance.--
                        Notwithstanding any other provision of 
                        this title, in the case of a 
                        beneficiary who receives the services 
                        described in clause (i)--
                                  (I) in computing the amount 
                                of any applicable coinsurance, 
                                the computation of such 
                                coinsurance shall be based upon 
                                the fee schedule under which 
                                payment is made for the 
                                services, and
                                  (II) the amount of such 
                                coinsurance is equal to 25 
                                percent of the payment amount 
                                under the fee schedule 
                                described in subclause (I).
                  (D) Special rule for detected lesions.--If 
                during the course of such screening 
                colonoscopy, a lesion or growth is detected 
                which results in a biopsy or removal of the 
                lesion or growth, payment under this part shall 
                not be made for the screening colonoscopy but 
                shall be made for the procedure classified as a 
                colonoscopy with such biopsy or removal.
                  (E) Frequency limit.--No payment may be made 
                under this part for a colorectal cancer 
                screening test consisting of a screening 
                colonoscopy for individuals at high risk for 
                colorectal cancer if the procedure is performed 
                within the 23 months after a previous screening 
                colonoscopy or for other individuals if the 
                procedure is performed within the 119 months 
                after a previous screening colonoscopy or 
                within 47 months after a previous screening 
                flexible sigmoidoscopy.
  (e) Accreditation Requirement for Advanced Diagnostic Imaging 
Services.--
          (1) In general.--
                  (A) In general.--Beginning with January 1, 
                2012, with respect to the technical component 
                of advanced diagnostic imaging services for 
                which payment is made under the fee schedule 
                established under section 1848(b) and that are 
                furnished by a supplier, payment may only be 
                made if such supplier is accredited by an 
                accreditation organization designated by the 
                Secretary under paragraph (2)(B)(i).
                  (B) Advanced diagnostic imaging services 
                defined.--In this subsection, the term 
                ``advanced diagnostic imaging services'' 
                includes--
                          (i) diagnostic magnetic resonance 
                        imaging, computed tomography, and 
                        nuclear medicine (including positron 
                        emission tomography); and
                          (ii) such other diagnostic imaging 
                        services, including services described 
                        in section 1848(b)(4)(B) (excluding X-
                        ray, ultrasound, and fluoroscopy), as 
                        specified by the Secretary in 
                        consultation with physician specialty 
                        organizations and other stakeholders.
                  (C) Supplier defined.--In this subsection, 
                the term ``supplier'' has the meaning given 
                such term in section 1861(d).
          (2) Accreditation organizations.--
                  (A) Factors for designation of accreditation 
                organizations.--The Secretary shall consider 
                the following factors in designating 
                accreditation organizations under subparagraph 
                (B)(i) and in reviewing and modifying the list 
                of accreditation organizations designated 
                pursuant to subparagraph (C):
                          (i) The ability of the organization 
                        to conduct timely reviews of 
                        accreditation applications.
                          (ii) Whether the organization has 
                        established a process for the timely 
                        integration of new advanced diagnostic 
                        imaging services into the 
                        organization's accreditation program.
                          (iii) Whether the organization uses 
                        random site visits, site audits, or 
                        other strategies for ensuring 
                        accredited suppliers maintain adherence 
                        to the criteria described in paragraph 
                        (3).
                          (iv) The ability of the organization 
                        to take into account the capacities of 
                        suppliers located in a rural area (as 
                        defined in section 1886(d)(2)(D)).
                          (v) Whether the organization has 
                        established reasonable fees to be 
                        charged to suppliers applying for 
                        accreditation.
                          (vi) Such other factors as the 
                        Secretary determines appropriate.
                  (B) Designation.--Not later than January 1, 
                2010, the Secretary shall designate 
                organizations to accredit suppliers furnishing 
                the technical component of advanced diagnostic 
                imaging services. The list of accreditation 
                organizations so designated may be modified 
                pursuant to subparagraph (C).
                  (C) Review and modification of list of 
                accreditation organizations.--
                          (i) In general.--The Secretary shall 
                        review the list of accreditation 
                        organizations designated under 
                        subparagraph (B) taking into account 
                        the factors under subparagraph (A). 
                        Taking into account the results of such 
                        review, the Secretary may, by 
                        regulation, modify the list of 
                        accreditation organizations designated 
                        under subparagraph (B).
                          (ii) Special rule for accreditations 
                        done prior to removal from list of 
                        designated accreditation 
                        organizations.--In the case where the 
                        Secretary removes an organization from 
                        the list of accreditation organizations 
                        designated under subparagraph (B), any 
                        supplier that is accredited by the 
                        organization during the period 
                        beginning on the date on which the 
                        organization is designated as an 
                        accreditation organization under 
                        subparagraph (B) and ending on the date 
                        on which the organization is removed 
                        from such list shall be considered to 
                        have been accredited by an organization 
                        designated by the Secretary under 
                        subparagraph (B) for the remaining 
                        period such accreditation is in effect.
          (3) Criteria for accreditation.--The Secretary shall 
        establish procedures to ensure that the criteria used 
        by an accreditation organization designated under 
        paragraph (2)(B) to evaluate a supplier that furnishes 
        the technical component of advanced diagnostic imaging 
        services for the purpose of accreditation of such 
        supplier is specific to each imaging modality. Such 
        criteria shall include--
                  (A) standards for qualifications of medical 
                personnel who are not physicians and who 
                furnish the technical component of advanced 
                diagnostic imaging services;
                  (B) standards for qualifications and 
                responsibilities of medical directors and 
                supervising physicians, including standards 
                that recognize the considerations described in 
                paragraph (4);
                  (C) procedures to ensure that equipment used 
                in furnishing the technical component of 
                advanced diagnostic imaging services meets 
                performance specifications;
                  (D) standards that require the supplier have 
                procedures in place to ensure the safety of 
                persons who furnish the technical component of 
                advanced diagnostic imaging services and 
                individuals to whom such services are 
                furnished;
                  (E) standards that require the establishment 
                and maintenance of a quality assurance and 
                quality control program by the supplier that is 
                adequate and appropriate to ensure the 
                reliability, clarity, and accuracy of the 
                technical quality of diagnostic images produced 
                by such supplier; and
                  (F) any other standards or procedures the 
                Secretary determines appropriate.
          (4) Recognition in standards for the evaluation of 
        medical directors and supervising physicians.--The 
        standards described in paragraph (3)(B) shall recognize 
        whether a medical director or supervising physician--
                  (A) in a particular specialty receives 
                training in advanced diagnostic imaging 
                services in a residency program;
                  (B) has attained, through experience, the 
                necessary expertise to be a medical director or 
                a supervising physician;
                  (C) has completed any continuing medical 
                education courses relating to such services; or
                  (D) has met such other standards as the 
                Secretary determines appropriate.
          (5) Rule for accreditations made prior to 
        designation.--In the case of a supplier that is 
        accredited before January 1, 2010, by an accreditation 
        organization designated by the Secretary under 
        paragraph (2)(B) as of January 1, 2010, such supplier 
        shall be considered to have been accredited by an 
        organization designated by the Secretary under such 
        paragraph as of January 1, 2012, for the remaining 
        period such accreditation is in effect.
  (f) Reduction in Payments for Physician Pathology Services 
During 1991.--
          (1) In general.--For physician pathology services 
        furnished under this part during 1991, the prevailing 
        charges used in a locality under this part shall be 7 
        percent below the prevailing charges used in the 
        locality under this part in 1990 after March 31.
          (2) Limitation.--The prevailing charge for the 
        technical and professional components of an physician 
        pathology service furnished by a physician through an 
        independent laboratory shall not be reduced pursuant to 
        paragraph (1) to the extent that such reduction would 
        reduce such prevailing charge below 115 percent of the 
        prevailing charge for the professional component of 
        such service when furnished by a hospital-based 
        physician in the same locality. For purposes of the 
        preceding sentence, an independent laboratory is a 
        laboratory that is independent of a hospital and 
        separate from the attending or consulting physicians' 
        office.
  (g) Payment for Outpatient Critical Access Hospital 
Services.--
          (1) In general.--The amount of payment for outpatient 
        critical access hospital services of a critical access 
        hospital is equal to 101 percent of the reasonable 
        costs of the hospital in providing such services, 
        unless the hospital makes the election under paragraph 
        (2).
          (2) Election of cost-based hospital outpatient 
        service payment plus fee schedule for professional 
        services.--A critical access hospital may elect to be 
        paid for outpatient critical access hospital services 
        amounts equal to the sum of the following, less the 
        amount that such hospital may charge as described in 
        section 1866(a)(2)(A):
                  (A) Facility fee.--With respect to facility 
                services, not including any services for which 
                payment may be made under subparagraph (B), 101 
                percent of the reasonable costs of the critical 
                access hospital in providing such services.
                  (B) Fee schedule for professional services.--
                With respect to professional services otherwise 
                included within outpatient critical access 
                hospital services, 115 percent of such amounts 
                as would otherwise be paid under this part if 
                such services were not included in outpatient 
                critical access hospital services. Subsections 
                (x) and (y) of section 1833 shall not be taken 
                into account in determining the amounts that 
                would otherwise be paid pursuant to the 
                preceding sentence.
        The Secretary may not require, as a condition for 
        applying subparagraph (B) with respect to a critical 
        access hospital, that each physician or other 
        practitioner providing professional services in the 
        hospital must assign billing rights with respect to 
        such services, except that such subparagraph shall not 
        apply to those physicians and practitioners who have 
        not assigned such billing rights.
          (3) Disregarding charges.--The payment amounts under 
        this subsection shall be determined without regard to 
        the amount of the customary or other charge.
          (4) Treatment of clinical diagnostic laboratory 
        services.--No coinsurance, deductible, copayment, or 
        other cost-sharing otherwise applicable under this part 
        shall apply with respect to clinical diagnostic 
        laboratory services furnished as an outpatient critical 
        access hospital service. Nothing in this title shall be 
        construed as providing for payment for clinical 
        diagnostic laboratory services furnished as part of 
        outpatient critical access hospital services, other 
        than on the basis described in this subsection. For 
        purposes of the preceding sentence and section 
        1861(mm)(3), clinical diagnostic laboratory services 
        furnished by a critical access hospital shall be 
        treated as being furnished as part of outpatient 
        critical access services without regard to whether the 
        individual with respect to whom such services are 
        furnished is physically present in the critical access 
        hospital, or in a skilled nursing facility or a clinic 
        (including a rural health clinic) that is operated by a 
        critical access hospital, at the time the specimen is 
        collected.
          (5) Coverage of costs for certain emergency room on-
        call providers.--In determining the reasonable costs of 
        outpatient critical access hospital services under 
        paragraphs (1) and (2)(A), the Secretary shall 
        recognize as allowable costs, amounts (as defined by 
        the Secretary) for reasonable compensation and related 
        costs for physicians, physician assistants, nurse 
        practitioners, and clinical nurse specialists who are 
        on-call (as defined by the Secretary) to provide 
        emergency services but who are not present on the 
        premises of the critical access hospital involved, and 
        are not otherwise furnishing services covered under 
        this title and are not on-call at any other provider or 
        facility.
  (h) Payment for Prosthetic Devices and Orthotics and 
Prosthetics.--
          (1) General rule for payment.--
                  (A) In general.--Payment under this 
                subsection for prosthetic devices and orthotics 
                and prosthetics shall be made in a lump-sum 
                amount for the purchase of the item in an 
                amount equal to 80 percent of the payment basis 
                described in subparagraph (B).
                  (B) Payment basis.--Except as provided in 
                subparagraphs (C), (E), and (H)(i), the payment 
                basis described in this subparagraph is the 
                lesser of--
                          (i) the actual charge for the item; 
                        or
                          (ii) the amount recognized under 
                        paragraph (2) as the purchase price for 
                        the item.
                  (C) Exception for certain public home health 
                agencies.--Subparagraph (B)(i) shall not apply 
                to an item furnished by a public home health 
                agency (or by another home health agency which 
                demonstrates to the satisfaction of the 
                Secretary that a significant portion of its 
                patients are low income) free of charge or at 
                nominal charges to the public.
                  (D) Exclusive payment rule.--Subject to 
                subparagraph (H)(ii), this subsection shall 
                constitute the exclusive provision of this 
                title for payment for prosthetic devices, 
                orthotics, and prosthetics under this part or 
                under part A to a home health agency.
                  (E) Exception for certain items.--Payment for 
                ostomy supplies, tracheostomy supplies, and 
                urologicals shall be made in accordance with 
                subparagraphs (B) and (C) of section 
                1834(a)(2).
                  (F) Special payment rules for certain 
                prosthetics and custom-fabricated orthotics.--
                          (i) In general.--No payment shall be 
                        made under this subsection for an item 
                        of custom-fabricated orthotics 
                        described in clause (ii) or for an item 
                        of prosthetics unless such item is--
                                  (I) furnished by a qualified 
                                practitioner; and
                                  (II) fabricated by a 
                                qualified practitioner or a 
                                qualified supplier at a 
                                facility that meets such 
                                criteria as the Secretary 
                                determines appropriate.
                          (ii) Description of custom-fabricated 
                        item.--
                                  (I) In general.--An item 
                                described in this clause is an 
                                item of custom-fabricated 
                                orthotics that requires 
                                education, training, and 
                                experience to custom-fabricate 
                                and that is included in a list 
                                established by the Secretary in 
                                subclause (II). Such an item 
                                does not include shoes and shoe 
                                inserts.
                                  (II) List of items.--The 
                                Secretary, in consultation with 
                                appropriate experts in 
                                orthotics (including national 
                                organizations representing 
                                manufacturers of orthotics), 
                                shall establish and update as 
                                appropriate a list of items to 
                                which this subparagraph 
                                applies. No item may be 
                                included in such list unless 
                                the item is individually 
                                fabricated for the patient over 
                                a positive model of the 
                                patient.
                          (iii) Qualified practitioner 
                        defined.--In this subparagraph, the 
                        term ``qualified practitioner'' means a 
                        physician or other individual who--
                                  (I) is a qualified physical 
                                therapist or a qualified 
                                occupational therapist;
                                  (II) in the case of a State 
                                that provides for the licensing 
                                of orthotics and prosthetics, 
                                is licensed in orthotics or 
                                prosthetics by the State in 
                                which the item is supplied; or
                                  (III) in the case of a State 
                                that does not provide for the 
                                licensing of orthotics and 
                                prosthetics, is specifically 
                                trained and educated to provide 
                                or manage the provision of 
                                prosthetics and custom-designed 
                                or -fabricated orthotics, and 
                                is certified by the American 
                                Board for Certification in 
                                Orthotics and Prosthetics, Inc. 
                                or by the Board for Orthotist/
                                Prosthetist Certification, or 
                                is credentialed and approved by 
                                a program that the Secretary 
                                determines, in consultation 
                                with appropriate experts in 
                                orthotics and prosthetics, has 
                                training and education 
                                standards that are necessary to 
                                provide such prosthetics and 
                                orthotics.
                          (iv) Qualified supplier defined.--In 
                        this subparagraph, the term ``qualified 
                        supplier'' means any entity that is 
                        accredited by the American Board for 
                        Certification in Orthotics and 
                        Prosthetics, Inc. or by the Board for 
                        Orthotist/Prosthetist Certification, or 
                        accredited and approved by a program 
                        that the Secretary determines has 
                        accreditation and approval standards 
                        that are essentially equivalent to 
                        those of such Board.
                  (G) Replacement of prosthetic devices and 
                parts.--
                          (i) In general.--Payment shall be 
                        made for the replacement of prosthetic 
                        devices which are artificial limbs, or 
                        for the replacement of any part of such 
                        devices, without regard to continuous 
                        use or useful lifetime restrictions if 
                        an ordering physician determines that 
                        the provision of a replacement device, 
                        or a replacement part of such a device, 
                        is necessary because of any of the 
                        following:
                                  (I) A change in the 
                                physiological condition of the 
                                patient.
                                  (II) An irreparable change in 
                                the condition of the device, or 
                                in a part of the device.
                                  (III) The condition of the 
                                device, or the part of the 
                                device, requires repairs and 
                                the cost of such repairs would 
                                be more than 60 percent of the 
                                cost of a replacement device, 
                                or, as the case may be, of the 
                                part being replaced.
                          (ii) Confirmation may be required if 
                        device or part being replaced is less 
                        than 3 years old.--If a physician 
                        determines that a replacement device, 
                        or a replacement part, is necessary 
                        pursuant to clause (i)--
                                  (I) such determination shall 
                                be controlling; and
                                  (II) such replacement device 
                                or part shall be deemed to be 
                                reasonable and necessary for 
                                purposes of section 
                                1862(a)(1)(A);
                        except that if the device, or part, 
                        being replaced is less than 3 years old 
                        (calculated from the date on which the 
                        beneficiary began to use the device or 
                        part), the Secretary may also require 
                        confirmation of necessity of the 
                        replacement device or replacement part, 
                        as the case may be.
                  (H) Application of competitive acquisition to 
                orthotics; limitation of inherent 
                reasonableness authority.--In the case of 
                orthotics described in paragraph (2)(C) of 
                section 1847(a) furnished on or after January 
                1, 2009, subject to subsection (a)(1)(G), that 
                are included in a competitive acquisition 
                program in a competitive acquisition area under 
                such section--
                          (i) the payment basis under this 
                        subsection for such orthotics furnished 
                        in such area shall be the payment basis 
                        determined under such competitive 
                        acquisition program; and
                          (ii) subject to subsection (a)(1)(G), 
                        the Secretary may use information on 
                        the payment determined under such 
                        competitive acquisition programs to 
                        adjust the payment amount otherwise 
                        recognized under subparagraph (B)(ii) 
                        for an area that is not a competitive 
                        acquisition area under section 1847, 
                        and in the case of such adjustment, 
                        paragraphs (8) and (9) of section 
                        1842(b) shall not be applied.
          (2) Purchase price recognized.--For purposes of 
        paragraph (1), the amount that is recognized under this 
        paragraph as the purchase price for prosthetic devices, 
        orthotics, and prosthetics is the amount described in 
        subparagraph (C) of this paragraph, determined as 
        follows:
                  (A) Computation of local purchase price.--
                Each carrier under section 1842 shall compute a 
                base local purchase price for the item as 
                follows:
                          (i) The carrier shall compute a base 
                        local purchase price for each item 
                        equal to the average reasonable charge 
                        in the locality for the purchase of the 
                        item for the 12-month period ending 
                        with June 1987.
                          (ii) The carrier shall compute a 
                        local purchase price, with respect to 
                        the furnishing of each particular 
                        item--
                                  (I) in 1989 and 1990, equal 
                                to the base local purchase 
                                price computed under clause (i) 
                                increased by the percentage 
                                increase in the consumer price 
                                index for all urban consumers 
                                (United States city average) 
                                for the 6-month period ending 
                                with December 1987, or
                                  (II) in 1991, 1992 or 1993, 
                                equal to the local purchase 
                                price computed under this 
                                clause for the previous year 
                                increased by the applicable 
                                percentage increase for the 
                                year.
                  (B) Computation of regional purchase price.--
                With respect to the furnishing of a particular 
                item in each region (as defined by the 
                Secretary), the Secretary shall compute a 
                regional purchase price--
                          (i) for 1992, equal to the average 
                        (weighted by relative volume of all 
                        claims among carriers) of the local 
                        purchase prices for the carriers in the 
                        region computed under subparagraph 
                        (A)(ii)(II) for the year, and
                          (ii) for each subsequent year, equal 
                        to the regional purchase price computed 
                        under this subparagraph for the 
                        previous year increased by the 
                        applicable percentage increase for the 
                        year.
                  (C) Purchase price recognized.--For purposes 
                of paragraph (1) and subject to subparagraph 
                (D), the amount that is recognized under this 
                paragraph as the purchase price for each item 
                furnished--
                          (i) in 1989, 1990, or 1991, is 100 
                        percent of the local purchase price 
                        computed under subparagraph (A)(ii);
                          (ii) in 1992, is the sum of (I) 75 
                        percent of the local purchase price 
                        computed under subparagraph (A)(ii)(II) 
                        for 1992, and (II) 25 percent of the 
                        regional purchase price computed under 
                        subparagraph (B) for 1992;
                          (iii) in 1993, is the sum of (I) 50 
                        percent of the local purchase price 
                        computed under subparagraph (A)(ii)(II) 
                        for 1993, and (II) 50 percent of the 
                        regional purchase price computed under 
                        subparagraph (B) for 1993; and
                          (iv) in 1994 or a subsequent year, is 
                        the regional purchase price computed 
                        under subparagraph (B) for that year.
                  (D) Range on amount recognized.--The amount 
                that is recognized under subparagraph (C) as 
                the purchase price for an item furnished--
                          (i) in 1992, may not exceed 125 
                        percent, and may not be lower than 85 
                        percent, of the average of the purchase 
                        prices recognized under such 
                        subparagraph for all the carrier 
                        service areas in the United States in 
                        that year; and
                          (ii) in a subsequent year, may not 
                        exceed 120 percent, and may not be 
                        lower than 90 percent, of the average 
                        of the purchase prices recognized under 
                        such subparagraph for all the carrier 
                        service areas in the United States in 
                        that year.
          (3) Applicability of certain provisions relating to 
        durable medical equipment.--Paragraphs (12) and (17) 
        and subparagraphs (A) and (B) of paragraph (10) and 
        paragraph (11) of subsection (a) shall apply to 
        prosthetic devices, orthotics, and prosthetics in the 
        same manner as such provisions apply to covered items 
        under such subsection.
          (4) Definitions.--In this subsection--
                  (A) the term ``applicable percentage 
                increase'' means--
                          (i) for 1991, 0 percent;
                          (ii) for 1992 and 1993, the 
                        percentage increase in the consumer 
                        price index for all urban consumers 
                        (United States city average) for the 
                        12-month period ending with June of the 
                        previous year;
                          (iii) for 1994 and 1995, 0 percent;
                          (iv) for 1996 and 1997, the 
                        percentage increase in the consumer 
                        price index for all urban consumers 
                        (United States city average) for the 
                        12-month period ending with June of the 
                        previous year;
                          (v) for each of the years 1998 
                        through 2000, 1 percent;
                          (vi) for 2001, the percentage 
                        increase in the consumer price index 
                        for all urban consumers (U.S. city 
                        average) for the 12-month period ending 
                        with June 2000;
                          (vii) for 2002, 1 percent;
                          (viii) for 2003, the percentage 
                        increase in the consumer price index 
                        for all urban consumers (United States 
                        city average) for the 12-month period 
                        ending with June of the previous year;
                          (ix) for 2004, 2005, and 2006, 0 
                        percent;
                          (x) for for each of 2007 through 
                        2010, the percentage increase in the 
                        consumer price index for all urban 
                        consumers (United States city average) 
                        for the 12-month period ending with 
                        June of the previous year; and
                          (xi) for 2011 and each subsequent 
                        year--
                                  (I) the percentage increase 
                                in the consumer price index for 
                                all urban consumers (United 
                                States city average) for the 
                                12-month period ending with 
                                June of the previous year, 
                                reduced by--
                                  (II) the productivity 
                                adjustment described in section 
                                1886(b)(3)(B)(xi)(II).
                  (B) the term ``prosthetic devices'' has the 
                meaning given such term in section 1861(s)(8), 
                except that such term does not include 
                parenteral and enteral nutrition nutrients, 
                supplies, and equipment and does not include an 
                implantable item for which payment may be made 
                under section 1833(t); and
                  (C) the term ``orthotics and prosthetics'' 
                has the meaning given such term in section 
                1861(s)(9) (and includes shoes described in 
                section 1861(s)(12)), but does not include 
                intraocular lenses or medical supplies 
                (including catheters, catheter supplies, ostomy 
                bags, and supplies related to ostomy care) 
                furnished by a home health agency under section 
                1861(m)(5).
        The application of subparagraph (A)(xi)(II) may result 
        in the applicable percentage increase under 
        subparagraph (A) being less than 0.0 for a year, and 
        may result in payment rates under this subsection for a 
        year being less than such payment rates for the 
        preceding year.
  (i) Payment for Surgical Dressings.--
          (1) In general.--Payment under this subsection for 
        surgical dressings (described in section 1861(s)(5)) 
        shall be made in a lump sum amount for the purchase of 
        the item in an amount equal to 80 percent of the lesser 
        of--
                  (A) the actual charge for the item; or
                  (B) a payment amount determined in accordance 
                with the methodology described in subparagraphs 
                (B) and (C) of subsection (a)(2) (except that 
                in applying such methodology, the national 
                limited payment amount referred to in such 
                subparagraphs shall be initially computed based 
                on local payment amounts using average 
                reasonable charges for the 12-month period 
                ending December 31, 1992, increased by the 
                covered item updates described in such 
                subsection for 1993 and 1994).
          (2) Exceptions.--Paragraph (1) shall not apply to 
        surgical dressings that are--
                  (A) furnished as an incident to a physician's 
                professional service; or
                  (B) furnished by a home health agency.
  (j) Requirements for Suppliers of Medical Equipment and 
Supplies.--
          (1) Issuance and renewal of supplier number.--
                  (A) Payment.--Except as provided in 
                subparagraph (C), no payment may be made under 
                this part after the date of the enactment of 
                the Social Security Act Amendments of 1994 for 
                items furnished by a supplier of medical 
                equipment and supplies unless such supplier 
                obtains (and renews at such intervals as the 
                Secretary may require) a supplier number.
                  (B) Standards for possessing a supplier 
                number.--A supplier may not obtain a supplier 
                number unless--
                          (i) for medical equipment and 
                        supplies furnished on or after the date 
                        of the enactment of the Social Security 
                        Act Amendments of 1994 and before 
                        January 1, 1996, the supplier meets 
                        standards prescribed by the Secretary 
                        in regulations issued on June 18, 1992; 
                        and
                          (ii) for medical equipment and 
                        supplies furnished on or after January 
                        1, 1996, the supplier meets revised 
                        standards prescribed by the Secretary 
                        (in consultation with representatives 
                        of suppliers of medical equipment and 
                        supplies, carriers, and consumers) that 
                        shall include requirements that the 
                        supplier--
                                  (I) comply with all 
                                applicable State and Federal 
                                licensure and regulatory 
                                requirements;
                                  (II) maintain a physical 
                                facility on an appropriate 
                                site;
                                  (III) have proof of 
                                appropriate liability 
                                insurance; and
                                  (IV) meet such other 
                                requirements as the Secretary 
                                may specify.
                  (C) Exception for items furnished as incident 
                to a physician's service.--Subparagraph (A) 
                shall not apply with respect to medical 
                equipment and supplies furnished incident to a 
                physician's service.
                  (D) Prohibition against multiple supplier 
                numbers.--The Secretary may not issue more than 
                one supplier number to any supplier of medical 
                equipment and supplies unless the issuance of 
                more than one number is appropriate to identify 
                subsidiary or regional entities under the 
                supplier's ownership or control.
                  (E) Prohibition against delegation of 
                supplier determinations.--The Secretary may not 
                delegate (other than by contract under section 
                1842) the responsibility to determine whether 
                suppliers meet the standards necessary to 
                obtain a supplier number.
          (2) Certificates of medical necessity.--
                  (A) Limitation on information provided by 
                suppliers on certificates of medical 
                necessity.--
                          (i) In general.--Effective 60 days 
                        after the date of the enactment of the 
                        Social Security Act Amendments of 1994, 
                        a supplier of medical equipment and 
                        supplies may distribute to physicians, 
                        or to individuals entitled to benefits 
                        under this part, a certificate of 
                        medical necessity for commercial 
                        purposes which contains no more than 
                        the following information completed by 
                        the supplier:
                                  (I) An identification of the 
                                supplier and the beneficiary to 
                                whom such medical equipment and 
                                supplies are furnished.
                                  (II) A description of such 
                                medical equipment and supplies.
                                  (III) Any product code 
                                identifying such medical 
                                equipment and supplies.
                                  (IV) Any other administrative 
                                information (other than 
                                information relating to the 
                                beneficiary's medical 
                                condition) identified by the 
                                Secretary.
                          (ii) Information on payment amount 
                        and charges.--If a supplier distributes 
                        a certificate of medical necessity 
                        containing any of the information 
                        permitted to be supplied under clause 
                        (i), the supplier shall also list on 
                        the certificate of medical necessity 
                        the fee schedule amount and the 
                        supplier's charge for the medical 
                        equipment or supplies being furnished 
                        prior to distribution of such 
                        certificate to the physician.
                          (iii) Penalty.--Any supplier of 
                        medical equipment and supplies who 
                        knowingly and willfully distributes a 
                        certificate of medical necessity in 
                        violation of clause (i) or fails to 
                        provide the information required under 
                        clause (ii) is subject to a civil money 
                        penalty in an amount not to exceed 
                        $1,000 for each such certificate of 
                        medical necessity so distributed. The 
                        provisions of section 1128A (other than 
                        subsections (a) and (b)) shall apply to 
                        civil money penalties under this 
                        subparagraph in the same manner as they 
                        apply to a penalty or proceeding under 
                        section 1128A(a).
                  (B) Definition.--For purposes of this 
                paragraph, the term ``certificate of medical 
                necessity'' means a form or other document 
                containing information required by the carrier 
                to be submitted to show that an item is 
                reasonable and necessary for the diagnosis or 
                treatment of illness or injury or to improve 
                the functioning of a malformed body member.
          (3) Coverage and review criteria.--The Secretary 
        shall annually review the coverage and utilization of 
        items of medical equipment and supplies to determine 
        whether such items should be made subject to coverage 
        and utilization review criteria, and if appropriate, 
        shall develop and apply such criteria to such items.
          (4) Limitation on patient liability.--If a supplier 
        of medical equipment and supplies (as defined in 
        paragraph (5))--
                  (A) furnishes an item or service to a 
                beneficiary for which no payment may be made by 
                reason of paragraph (1);
                  (B) furnishes an item or service to a 
                beneficiary for which payment is denied in 
                advance under subsection (a)(15); or
                  (C) furnishes an item or service to a 
                beneficiary for which payment is denied under 
                section 1862(a)(1);
        any expenses incurred for items and services furnished 
        to an individual by such a supplier not on an assigned 
        basis shall be the responsibility of such supplier. The 
        individual shall have no financial responsibility for 
        such expenses and the supplier shall refund on a timely 
        basis to the individual (and shall be liable to the 
        individual for) any amounts collected from the 
        individual for such items or services. The provisions 
        of subsection (a)(18) shall apply to refunds required 
        under the previous sentence in the same manner as such 
        provisions apply to refunds under such subsection.
          (5) Definition.--The term ``medical equipment and 
        supplies'' means--
                  (A) durable medical equipment (as defined in 
                section 1861(n));
                  (B) prosthetic devices (as described in 
                section 1861(s)(8));
                  (C) orthotics and prosthetics (as described 
                in section 1861(s)(9));
                  (D) surgical dressings (as described in 
                section 1861(s)(5));
                  (E) such other items as the Secretary may 
                determine; and
                  (F) for purposes of paragraphs (1) and (3)--
                          (i) home dialysis supplies and 
                        equipment (as described in section 
                        1861(s)(2)(F)),
                          (ii) immunosuppressive drugs (as 
                        described in section 1861(s)(2)(J)),
                          (iii) therapeutic shoes for diabetics 
                        (as described in section 1861(s)(12)),
                          (iv) oral drugs prescribed for use as 
                        an anticancer therapeutic agent (as 
                        described in section 1861(s)(2)(Q)), 
                        and
                          (v) self-administered erythropoetin 
                        (as described in section 
                        1861(s)(2)(P)).
  (k) Payment for Outpatient Therapy Services and Comprehensive 
Outpatient Rehabilitation Services.--
          (1) In general.--With respect to services described 
        in section 1833(a)(8) or 1833(a)(9) for which payment 
        is determined under this subsection, the payment basis 
        shall be--
                  (A) for services furnished during 1998, the 
                amount determined under paragraph (2); or
                  (B) for services furnished during a 
                subsequent year, 80 percent of the lesser of--
                          (i) the actual charge for the 
                        services, or
                          (ii) the applicable fee schedule 
                        amount (as defined in paragraph (3)) 
                        for the services.
          (2) Payment in 1998 based upon adjusted reasonable 
        costs.--The amount under this paragraph for services is 
        the lesser of--
                  (A) the charges imposed for the services, or
                  (B) the adjusted reasonable costs (as defined 
                in paragraph (4)) for the services,
        less 20 percent of the amount of the charges imposed 
        for such services.
          (3) Applicable fee schedule amount.--In this 
        subsection, the term ``applicable fee schedule amount'' 
        means, with respect to services furnished in a year, 
        the amount determined under the fee schedule 
        established under section 1848 for such services 
        furnished during the year or, if there is no such fee 
        schedule established for such services, the amount 
        determined under the fee schedule established for such 
        comparable services as the Secretary specifies.
          (4) Adjusted reasonable costs.--In paragraph (2), the 
        term ``adjusted reasonable costs'' means, with respect 
        to any services, reasonable costs determined for such 
        services, reduced by 10 percent. The 10-percent 
        reduction shall not apply to services described in 
        section 1833(a)(8)(B) (relating to services provided by 
        hospitals).
          (5) Uniform coding.--For claims for services 
        submitted on or after April 1, 1998, for which the 
        amount of payment is determined under this subsection, 
        the claim shall include a code (or codes) under a 
        uniform coding system specified by the Secretary that 
        identifies the services furnished.
          (6) Restraint on billing.--The provisions of 
        subparagraphs (A) and (B) of section 1842(b)(18) shall 
        apply to therapy services for which payment is made 
        under this subsection in the same manner as they apply 
        to services provided by a practitioner described in 
        section 1842(b)(18)(C).
          (7) Adjustment in discount for certain multiple 
        therapy services.--In the case of therapy services 
        furnished on or after April 1, 2013, and for which 
        payment is made under this subsection pursuant to the 
        applicable fee schedule amount (as defined in paragraph 
        (3)), instead of the 25 percent multiple procedure 
        payment reduction specified in the final rule published 
        by the Secretary in the Federal Register on November 
        29, 2010, the reduction percentage shall be 50 percent.
  (l) Establishment of Fee Schedule for Ambulance Services.--
          (1) In general.--The Secretary shall establish a fee 
        schedule for payment for ambulance services whether 
        provided directly by a supplier or provider or under 
        arrangement with a provider under this part through a 
        negotiated rulemaking process described in title 5, 
        United States Code, and in accordance with the 
        requirements of this subsection.
          (2) Considerations.--In establishing such fee 
        schedule, the Secretary shall--
                  (A) establish mechanisms to control increases 
                in expenditures for ambulance services under 
                this part;
                  (B) establish definitions for ambulance 
                services which link payments to the type of 
                services provided;
                  (C) consider appropriate regional and 
                operational differences;
                  (D) consider adjustments to payment rates to 
                account for inflation and other relevant 
                factors; and
                  (E) phase in the application of the payment 
                rates under the fee schedule in an efficient 
                and fair manner consistent with paragraph (11), 
                except that such phase-in shall provide for 
                full payment of any national mileage rate for 
                ambulance services provided by suppliers that 
                are paid by carriers in any of the 50 States 
                where payment by a carrier for such services 
                for all such suppliers in such State did not, 
                prior to the implementation of the fee 
                schedule, include a separate amount for all 
                mileage within the county from which the 
                beneficiary is transported.
          (3) Savings.--In establishing such fee schedule, the 
        Secretary shall--
                  (A) ensure that the aggregate amount of 
                payments made for ambulance services under this 
                part during 2000 does not exceed the aggregate 
                amount of payments which would have been made 
                for such services under this part during such 
                year if the amendments made by section 4531(a) 
                of the Balanced Budget Act of 1997 continued in 
                effect, except that in making such 
                determination the Secretary shall assume an 
                update in such payments for 2002 equal to 
                percentage increase in the consumer price index 
                for all urban consumers (U.S. city average) for 
                the 12-month period ending with June of the 
                previous year reduced in the case of 2002 by 
                1.0 percentage points;
                  (B) set the payment amounts provided under 
                the fee schedule for services furnished in 2001 
                and each subsequent year at amounts equal to 
                the payment amounts under the fee schedule for 
                services furnished during the previous year, 
                increased, subject to subparagraph (C) and the 
                succeeding sentence of this paragraph, by the 
                percentage increase in the consumer price index 
                for all urban consumers (U.S. city average) for 
                the 12-month period ending with June of the 
                previous year reduced in the case of 2002 by 
                1.0 percentage points; and
                  (C) for 2011 and each subsequent year, after 
                determining the percentage increase under 
                subparagraph (B) for the year, reduce such 
                percentage increase by the productivity 
                adjustment described in section 
                1886(b)(3)(B)(xi)(II).
        The application of subparagraph (C) may result in the 
        percentage increase under subparagraph (B) being less 
        than 0.0 for a year, and may result in payment rates 
        under the fee schedule under this subsection for a year 
        being less than such payment rates for the preceding 
        year.
          (4) Consultation.--In establishing the fee schedule 
        for ambulance services under this subsection, the 
        Secretary shall consult with various national 
        organizations representing individuals and entities who 
        furnish and regulate ambulance services and share with 
        such organizations relevant data in establishing such 
        schedule.
          (5) Limitation on review.--There shall be no 
        administrative or judicial review under section 1869 or 
        otherwise of the amounts established under the fee 
        schedule for ambulance services under this subsection, 
        including matters described in paragraph (2).
          (6) Restraint on billing.--The provisions of 
        subparagraphs (A) and (B) of section 1842(b)(18) shall 
        apply to ambulance services for which payment is made 
        under this subsection in the same manner as they apply 
        to services provided by a practitioner described in 
        section 1842(b)(18)(C).
          (7) Coding system.--The Secretary may require the 
        claim for any services for which the amount of payment 
        is determined under this subsection to include a code 
        (or codes) under a uniform coding system specified by 
        the Secretary that identifies the services furnished.
          (8) Services furnished by critical access 
        hospitals.--Notwithstanding any other provision of this 
        subsection, the Secretary shall pay 101 percent of the 
        reasonable costs incurred in furnishing ambulance 
        services if such services are furnished--
                  (A) by a critical access hospital (as defined 
                in section 1861(mm)(1)), or
                  (B) by an entity that is owned and operated 
                by a critical access hospital,
        but only if the critical access hospital or entity is 
        the only provider or supplier of ambulance services 
        that is located within a 35-mile drive of such critical 
        access hospital.
          (9) Transitional assistance for rural providers.--In 
        the case of ground ambulance services furnished on or 
        after July 1, 2001, and before January 1, 2004, for 
        which the transportation originates in a rural area (as 
        defined in section 1886(d)(2)(D)) or in a rural census 
        tract of a metropolitan statistical area (as determined 
        under the most recent modification of the Goldsmith 
        Modification, originally published in the Federal 
        Register on February 27, 1992 (57 Fed. Reg. 6725)), the 
        fee schedule established under this subsection shall 
        provide that, with respect to the payment rate for 
        mileage for a trip above 17 miles, and up to 50 miles, 
        the rate otherwise established shall be increased by 
        not less than \1/2\ of the additional payment per mile 
        established for the first 17 miles of such a trip 
        originating in a rural area.
          (10) Phase-in providing floor using blend of fee 
        schedule and regional fee schedules.--In carrying out 
        the phase-in under paragraph (2)(E) for each level of 
        ground service furnished in a year, the portion of the 
        payment amount that is based on the fee schedule shall 
        be the greater of the amount determined under such fee 
        schedule (without regard to this paragraph) or the 
        following blended rate of the fee schedule under 
        paragraph (1) and of a regional fee schedule for the 
        region involved:
                  (A) For 2004 (for services furnished on or 
                after July 1, 2004), the blended rate shall be 
                based 20 percent on the fee schedule under 
                paragraph (1) and 80 percent on the regional 
                fee schedule.
                  (B) For 2005, the blended rate shall be based 
                40 percent on the fee schedule under paragraph 
                (1) and 60 percent on the regional fee 
                schedule.
                  (C) For 2006, the blended rate shall be based 
                60 percent on the fee schedule under paragraph 
                (1) and 40 percent on the regional fee 
                schedule.
                  (D) For 2007, 2008, and 2009, the blended 
                rate shall be based 80 percent on the fee 
                schedule under paragraph (1) and 20 percent on 
                the regional fee schedule.
                  (E) For 2010 and each succeeding year, the 
                blended rate shall be based 100 percent on the 
                fee schedule under paragraph (1).
        For purposes of this paragraph, the Secretary shall 
        establish a regional fee schedule for each of the nine 
        census divisions (referred to in section 1886(d)(2)) 
        using the methodology (used in establishing the fee 
        schedule under paragraph (1)) to calculate a regional 
        conversion factor and a regional mileage payment rate 
        and using the same payment adjustments and the same 
        relative value units as used in the fee schedule under 
        such paragraph.
          (11) Adjustment in payment for certain long trips.--
        In the case of ground ambulance services furnished on 
        or after July 1, 2004, and before January 1, 2009, 
        regardless of where the transportation originates, the 
        fee schedule established under this subsection shall 
        provide that, with respect to the payment rate for 
        mileage for a trip above 50 miles the per mile rate 
        otherwise established shall be increased by \1/4\ of 
        the payment per mile otherwise applicable to miles in 
        excess of 50 miles in such trip.
          (12) Assistance for rural providers furnishing 
        services in low population density areas.--
                  (A) In general.--In the case of ground 
                ambulance services furnished on or after July 
                1, 2004, and before January 1, [2018] 2023, for 
                which the transportation originates in a 
                qualified rural area (identified under 
                subparagraph (B)(iii)), the Secretary shall 
                provide for a percent increase in the base rate 
                of the fee schedule for a trip established 
                under this subsection. In establishing such 
                percent increase, the Secretary shall estimate 
                the average cost per trip for such services 
                (not taking into account mileage) in the lowest 
                quartile as compared to the average cost per 
                trip for such services (not taking into account 
                mileage) in the highest quartile of all rural 
                county populations.
                  (B) Identification of qualified rural 
                areas.--
                          (i) Determination of population 
                        density in area.--Based upon data from 
                        the United States decennial census for 
                        the year 2000, the Secretary shall 
                        determine, for each rural area, the 
                        population density for that area.
                          (ii) Ranking of areas.--The Secretary 
                        shall rank each such area based on such 
                        population density.
                          (iii) Identification of qualified 
                        rural areas.--The Secretary shall 
                        identify those areas (in subparagraph 
                        (A) referred to as ``qualified rural 
                        areas'') with the lowest population 
                        densities that represent, if each such 
                        area were weighted by the population of 
                        such area (as used in computing such 
                        population densities), an aggregate 
                        total of 25 percent of the total of the 
                        population of all such areas.
                          (iv) Rural area.--For purposes of 
                        this paragraph, the term ``rural area'' 
                        has the meaning given such term in 
                        section 1886(d)(2)(D). If feasible, the 
                        Secretary shall treat a rural census 
                        tract of a metropolitan statistical 
                        area (as determined under the most 
                        recent modification of the Goldsmith 
                        Modification, originally published in 
                        the Federal Register on February 27, 
                        1992 (57 Fed. Reg. 6725) as a rural 
                        area for purposes of this paragraph.
                          (v) Judicial review.--There shall be 
                        no administrative or judicial review 
                        under section 1869, 1878, or otherwise, 
                        respecting the identification of an 
                        area under this subparagraph.
          (13) Temporary increase for ground ambulance 
        services.--
                  (A) In general.--After computing the rates 
                with respect to ground ambulance services under 
                the other applicable provisions of this 
                subsection, in the case of such services 
                furnished on or after July 1, 2004, and before 
                January 1, 2007, and for such services 
                furnished on or after July 1, 2008, and before 
                January 1, [2018] 2023, for which the 
                transportation originates in--
                          (i) a rural area described in 
                        paragraph (9) or in a rural census 
                        tract described in such paragraph, the 
                        fee schedule established under this 
                        section shall provide that the rate for 
                        the service otherwise established, 
                        after the application of any increase 
                        under paragraphs (11) and (12), shall 
                        be increased by 2 percent (or 3 percent 
                        if such service is furnished on or 
                        after July 1, 2008, and before January 
                        1, [2018] 2023); and
                          (ii) an area not described in clause 
                        (i), the fee schedule established under 
                        this subsection shall provide that the 
                        rate for the service otherwise 
                        established, after the application of 
                        any increase under paragraph (11), 
                        shall be increased by 1 percent (or 2 
                        percent if such service is furnished on 
                        or after July 1, 2008, and before 
                        January 1, [2018] 2023).
                  (B) Application of increased payments after 
                applicable period.--The increased payments 
                under subparagraph (A) shall not be taken into 
                account in calculating payments for services 
                furnished after the applicable period specified 
                in such subparagraph.
          (14) Providing appropriate coverage of rural air 
        ambulance services.--
                  (A) In general.--The regulations described in 
                section 1861(s)(7) shall provide, to the extent 
                that any ambulance services (whether ground or 
                air) may be covered under such section, that a 
                rural air ambulance service (as defined in 
                subparagraph (C)) is reimbursed under this 
                subsection at the air ambulance rate if the air 
                ambulance service--
                          (i) is reasonable and necessary based 
                        on the health condition of the 
                        individual being transported at or 
                        immediately prior to the time of the 
                        transport; and
                          (ii) complies with equipment and crew 
                        requirements established by the 
                        Secretary.
                  (B) Satisfaction of requirement of medically 
                necessary.--The requirement of subparagraph 
                (A)(i) is deemed to be met for a rural air 
                ambulance service if--
                          (i) subject to subparagraph (D), such 
                        service is requested by a physician or 
                        other qualified medical personnel (as 
                        specified by the Secretary) who 
                        certifies or reasonably determines that 
                        the individual's condition is such that 
                        the time needed to transport the 
                        individual by land or the instability 
                        of transportation by land poses a 
                        threat to the individual's survival or 
                        seriously endangers the individual's 
                        health; or
                          (ii) such service is furnished 
                        pursuant to a protocol that is 
                        established by a State or regional 
                        emergency medical service (EMS) agency 
                        and recognized or approved by the 
                        Secretary under which the use of an air 
                        ambulance is recommended, if such 
                        agency does not have an ownership 
                        interest in the entity furnishing such 
                        service.
                  (C) Rural air ambulance service defined.--For 
                purposes of this paragraph, the term ``rural 
                air ambulance service'' means fixed wing and 
                rotary wing air ambulance service in which the 
                point of pick up of the individual occurs in a 
                rural area (as defined in section 
                1886(d)(2)(D)) or in a rural census tract of a 
                metropolitan statistical area (as determined 
                under the most recent modification of the 
                Goldsmith Modification, originally published in 
                the Federal Register on February 27, 1992 (57 
                Fed. Reg. 6725)).
                  (D) Limitation.--
                          (i) In general.--Subparagraph (B)(i) 
                        shall not apply if there is a financial 
                        or employment relationship between the 
                        person requesting the rural air 
                        ambulance service and the entity 
                        furnishing the ambulance service, or an 
                        entity under common ownership with the 
                        entity furnishing the air ambulance 
                        service, or a financial relationship 
                        between an immediate family member of 
                        such requester and such an entity.
                          (ii) Exception.--Where a hospital and 
                        the entity furnishing rural air 
                        ambulance services are under common 
                        ownership, clause (i) shall not apply 
                        to remuneration (through employment or 
                        other relationship) by the hospital of 
                        the requester or immediate family 
                        member if the remuneration is for 
                        provider-based physician services 
                        furnished in a hospital (as described 
                        in section 1887) which are reimbursed 
                        under part A and the amount of the 
                        remuneration is unrelated directly or 
                        indirectly to the provision of rural 
                        air ambulance services.
          (15) Payment adjustment for non-emergency ambulance 
        transports for esrd beneficiaries.--The fee schedule 
        amount otherwise applicable under the preceding 
        provisions of this subsection shall be reduced by 10 
        percent for ambulance services furnished [on or after 
        October 1, 2013] during the period beginning on October 
        1, 2013, and ending on September 30, 2018, and by 32 
        percent for such services furnished on or after October 
        1, 2018, consisting of non-emergency basic life support 
        services involving transport of an individual with end-
        stage renal disease for renal dialysis services (as 
        described in section 1881(b)(14)(B)) furnished other 
        than on an emergency basis by a provider of services or 
        a renal dialysis facility.
          (16) Prior authorization for repetitive scheduled 
        non-emergent ambulance transports.--
                  (A) In general.--Beginning January 1, 2017, 
                if the expansion to all States of the model of 
                prior authorization described in paragraph (2) 
                of section 515(a) of the Medicare Access and 
                CHIP Reauthorization Act of 2015 meets the 
                requirements described in paragraphs (1) 
                through (3) of section 1115A(c), then the 
                Secretary shall expand such model to all 
                States.
                  (B) Funding.--The Secretary shall use funds 
                made available under section 1893(h)(10) to 
                carry out this paragraph.
                  (C) Clarification regarding budget 
                neutrality.--Nothing in this paragraph may be 
                construed to limit or modify the application of 
                section 1115A(b)(3)(B) to models described in 
                such section, including with respect to the 
                model described in subparagraph (A) and 
                expanded beginning on January 1, 2017, under 
                such subparagraph.
          (17) Requirement to submit cost report and authority 
        to suspend payments and deem certain payments 
        overpayments for ground ambulance services.--
                  (A) In general.--With respect to ground 
                ambulance services furnished by a supplier of 
                such services during cost reporting periods (as 
                defined in subparagraph (I)) beginning on or 
                after January 1, 2020, such supplier shall make 
                reports to the Secretary of information 
                described in section 1121(a) in accordance with 
                the uniform reporting system established under 
                such section for such suppliers and, as may be 
                required by the Secretary, of any of the 
                information described in subparagraph (B).
                  (B) Additional information.--The Secretary 
                may, with respect to a supplier of ground 
                ambulance services, require the following 
                information (to be reported to the extent 
                practicable under the uniform reporting system 
                established under section 1121(a) for such 
                suppliers):
                          (i) Whether the supplier is part of 
                        an emergency services department, a 
                        governmental organization, or another 
                        type of entity (as described by the 
                        Secretary).
                          (ii) The number of hours in a week 
                        during which the supplier is available 
                        for furnishing ground ambulance 
                        services.
                          (iii) The average number of volunteer 
                        hours a week used by the supplier.
                  (C) Suspension of payment.--Subject to 
                subparagraph (E), in the case that the 
                Secretary determines that a supplier of ground 
                ambulance services has not made to the 
                Secretary a timely report described in 
                subparagraph (A) with respect to a cost 
                reporting period beginning on or after January 
                1, 2020, and before January 1, 2022, the 
                Secretary may suspend payments made under this 
                subsection, in whole or in part, to such 
                supplier until the Secretary finds that such 
                supplier has made such a report.
                  (D) Deeming certain payments overpayments.--
                Subject to subparagraphs (E) and (F), in the 
                case that the Secretary determines that a 
                supplier of ground ambulance services has not 
                made to the Secretary a complete, accurate, and 
                timely report described in subparagraph (A) 
                with respect to a cost reporting period 
                beginning on or after January 1, 2022, the 
                Secretary may deem payments made under this 
                subsection to such supplier for such period to 
                be overpayments and recoup such overpayments.
                  (E) Hardship delay.--The Secretary shall 
                establish a process whereby a supplier of 
                ground ambulance services may request a delay 
                in making a report described in subparagraph 
                (A) with respect to a cost reporting period for 
                reason of significant hardship (as determined 
                by the Secretary).
                  (F) Authority to modify cost reporting 
                elements and enforcement.--Not earlier than 
                January 1, 2023, the Secretary may provide that 
                subparagraph (D) no longer applies to ground 
                ambulance services suppliers or a category of 
                such suppliers after--
                          (i) taking into account the 
                        recommendation of the Medicare Payment 
                        Advisory Commission in the most recent 
                        report available to the Secretary 
                        submitted under section 3 of the 
                        Comprehensive Operations, 
                        Sustainability, and Transport Act of 
                        2017 regarding whether cost reports 
                        made by suppliers or a category of 
                        suppliers (as specified for purposes of 
                        the report submitted under such 
                        section) should be required or 
                        modified; and
                          (ii) undertaking notice and comment 
                        rulemaking.
                  (G) Audit of cost reports.--The Secretary 
                shall audit reports described in subparagraph 
                (A) made with respect to cost reporting periods 
                beginning on or after January 1, 2021.
                  (H) Appeals.--The Secretary shall establish a 
                process whereby a supplier of ground ambulance 
                services may appeal a determination described 
                in subparagraph (C) or (D) made with respect to 
                a cost report required to be made by such 
                supplier under subparagraph (A).
                  (I) Definition.--In this paragraph, the term 
                ``cost reporting period'' means, with respect 
                to a year, the 12-month period beginning on 
                January 1 of such year.
  (m) Payment for Telehealth Services.--
          (1) In general.--The Secretary shall pay for 
        telehealth services that are furnished via a 
        telecommunications system by a physician (as defined in 
        section 1861(r)) or a practitioner (described in 
        section 1842(b)(18)(C)) to an eligible telehealth 
        individual enrolled under this part notwithstanding 
        that the individual physician or practitioner providing 
        the telehealth service is not at the same location as 
        the beneficiary. For purposes of the preceding 
        sentence, in the case of any Federal telemedicine 
        demonstration program conducted in Alaska or Hawaii, 
        the term ``telecommunications system'' includes store-
        and-forward technologies that provide for the 
        asynchronous transmission of health care information in 
        single or multimedia formats.
          (2) Payment amount.--
                  (A) Distant site.--The Secretary shall pay to 
                a physician or practitioner located at a 
                distant site that furnishes a telehealth 
                service to an eligible telehealth individual an 
                amount equal to the amount that such physician 
                or practitioner would have been paid under this 
                title had such service been furnished without 
                the use of a telecommunications system.
                  (B) Facility fee for originating site.--With 
                respect to a telehealth service, subject to 
                section 1833(a)(1)(U), there shall be paid to 
                the originating site a facility fee equal to--
                          (i) for the period beginning on 
                        October 1, 2001, and ending on December 
                        31, 2001, and for 2002, $20; and
                          (ii) for a subsequent year, the 
                        facility fee specified in clause (i) or 
                        this clause for the preceding year 
                        increased by the percentage increase in 
                        the MEI (as defined in section 
                        1842(i)(3)) for such subsequent year.
                  (C) Telepresenter not required.--Nothing in 
                this subsection shall be construed as requiring 
                an eligible telehealth individual to be 
                presented by a physician or practitioner at the 
                originating site for the furnishing of a 
                service via a telecommunications system, unless 
                it is medically necessary (as determined by the 
                physician or practitioner at the distant site).
          (3) Limitation on beneficiary charges.--
                  (A) Physician and practitioner.--The 
                provisions of section 1848(g) and subparagraphs 
                (A) and (B) of section 1842(b)(18) shall apply 
                to a physician or practitioner receiving 
                payment under this subsection in the same 
                manner as they apply to physicians or 
                practitioners under such sections.
                  (B) Originating site.--The provisions of 
                section 1842(b)(18) shall apply to originating 
                sites receiving a facility fee in the same 
                manner as they apply to practitioners under 
                such section.
          (4) Definitions.--For purposes of this subsection:
                  (A) Distant site.--The term ``distant site'' 
                means the site at which the physician or 
                practitioner is located at the time the service 
                is provided via a telecommunications system.
                  (B) Eligible telehealth individual.--The term 
                ``eligible telehealth individual'' means an 
                individual enrolled under this part who 
                receives a telehealth service furnished at an 
                originating site.
                  (C) Originating site.--
                          (i) In general.--The term 
                        ``originating site'' means only those 
                        sites described in clause (ii) at which 
                        the eligible telehealth individual is 
                        located at the time the service is 
                        furnished via a telecommunications 
                        system and only if such site is 
                        located--
                                  (I) in an area that is 
                                designated as a rural health 
                                professional shortage area 
                                under section 332(a)(1)(A) of 
                                the Public Health Service Act 
                                (42 U.S.C. 254e(a)(1)(A));
                                  (II) in a county that is not 
                                included in a Metropolitan 
                                Statistical Area; or
                                  (III) from an entity that 
                                participates in a Federal 
                                telemedicine demonstration 
                                project that has been approved 
                                by (or receives funding from) 
                                the Secretary of Health and 
                                Human Services as of December 
                                31, 2000.
                          (ii) Sites described.--The sites 
                        referred to in clause (i) are the 
                        following sites:
                                  (I) The office of a physician 
                                or practitioner.
                                  (II) A critical access 
                                hospital (as defined in section 
                                1861(mm)(1)).
                                  (III) A rural health clinic 
                                (as defined in section 
                                1861(aa)(2)).
                                  (IV) A Federally qualified 
                                health center (as defined in 
                                section 1861(aa)(4)).
                                  (V) A hospital (as defined in 
                                section 1861(e)).
                                  (VI) A hospital-based or 
                                critical access hospital-based 
                                renal dialysis center 
                                (including satellites).
                                  (VII) A skilled nursing 
                                facility (as defined in section 
                                1819(a)).
                                  (VIII) A community mental 
                                health center (as defined in 
                                section 1861(ff)(3)(B)).
                  (D) Physician.--The term ``physician'' has 
                the meaning given that term in section 1861(r).
                  (E) Practitioner.--The term ``practitioner'' 
                has the meaning given that term in section 
                1842(b)(18)(C).
                  (F) Telehealth service.--
                          (i) In general.--The term 
                        ``telehealth service'' means 
                        professional consultations, office 
                        visits, and office psychiatry services 
                        (identified as of July 1, 2000, by 
                        HCPCS codes 99241-99275, 99201-99215, 
                        90804-90809, and 90862 (and as 
                        subsequently modified by the 
                        Secretary)), and any additional service 
                        specified by the Secretary.
                          (ii) Yearly update.--The Secretary 
                        shall establish a process that 
                        provides, on an annual basis, for the 
                        addition or deletion of services (and 
                        HCPCS codes), as appropriate, to those 
                        specified in clause (i) for authorized 
                        payment under paragraph (1).
  (n) Authority To Modify or Eliminate Coverage of Certain 
Preventive Services.--Notwithstanding any other provision of 
this title, effective beginning on January 1, 2010, if the 
Secretary determines appropriate, the Secretary may--
          (1) modify--
                  (A) the coverage of any preventive service 
                described in subparagraph (A) of section 
                1861(ddd)(3) to the extent that such 
                modification is consistent with the 
                recommendations of the United States Preventive 
                Services Task Force; and
                  (B) the services included in the initial 
                preventive physical examination described in 
                subparagraph (B) of such section; and
          (2) provide that no payment shall be made under this 
        title for a preventive service described in 
        subparagraph (A) of such section that has not received 
        a grade of A, B, C, or I by such Task Force.
  (o) Development and Implementation of Prospective Payment 
System.--
          (1) Development.--
                  (A) In general.--The Secretary shall develop 
                a prospective payment system for payment for 
                Federally qualified health center services 
                furnished by Federally qualified health centers 
                under this title. Such system shall include a 
                process for appropriately describing the 
                services furnished by Federally qualified 
                health centers and shall establish payment 
                rates for specific payment codes based on such 
                appropriate descriptions of services. Such 
                system shall be established to take into 
                account the type, intensity, and duration of 
                services furnished by Federally qualified 
                health centers. Such system may include 
                adjustments, including geographic adjustments, 
                determined appropriate by the Secretary.
                  (B) Collection of data and evaluation.--By 
                not later than January 1, 2011, the Secretary 
                shall require Federally qualified health 
                centers to submit to the Secretary such 
                information as the Secretary may require in 
                order to develop and implement the prospective 
                payment system under this subsection, including 
                the reporting of services using HCPCS codes.
          (2) Implementation.--
                  (A) In general.--Notwithstanding section 
                1833(a)(3)(A), the Secretary shall provide, for 
                cost reporting periods beginning on or after 
                October 1, 2014, for payments of prospective 
                payment rates for Federally qualified health 
                center services furnished by Federally 
                qualified health centers under this title in 
                accordance with the prospective payment system 
                developed by the Secretary under paragraph (1).
                  (B) Payments.--
                          (i) Initial payments.--The Secretary 
                        shall implement such prospective 
                        payment system so that the estimated 
                        aggregate amount of prospective payment 
                        rates (determined prior to the 
                        application of section 1833(a)(1)(Z)) 
                        under this title for Federally 
                        qualified health center services in the 
                        first year that such system is 
                        implemented is equal to 100 percent of 
                        the estimated amount of reasonable 
                        costs (determined without the 
                        application of a per visit payment 
                        limit or productivity screen and prior 
                        to the application of section 
                        1866(a)(2)(A)(ii)) that would have 
                        occurred for such services under this 
                        title in such year if the system had 
                        not been implemented.
                          (ii) Payments in subsequent years.--
                        Payment rates in years after the year 
                        of implementation of such system shall 
                        be the payment rates in the previous 
                        year increased--
                                  (I) in the first year after 
                                implementation of such system, 
                                by the percentage increase in 
                                the MEI (as defined in section 
                                1842(i)(3)) for the year 
                                involved; and
                                  (II) in subsequent years, by 
                                the percentage increase in a 
                                market basket of Federally 
                                qualified health center goods 
                                and services as promulgated 
                                through regulations, or if such 
                                an index is not available, by 
                                the percentage increase in the 
                                MEI (as defined in section 
                                1842(i)(3)) for the year 
                                involved.
                  (C) Preparation for pps implementation.--
                Notwithstanding any other provision of law, the 
                Secretary may establish and implement by 
                program instruction or otherwise the payment 
                codes to be used under the prospective payment 
                system under this section.
  (p) Quality Incentives To Promote Patient Safety and Public 
Health in Computed Tomography.--
          (1) Quality incentives.--In the case of an applicable 
        computed tomography service (as defined in paragraph 
        (2)) for which payment is made under an applicable 
        payment system (as defined in paragraph (3)) and that 
        is furnished on or after January 1, 2016, using 
        equipment that is not consistent with the CT equipment 
        standard (described in paragraph (4)), the payment 
        amount for such service shall be reduced by the 
        applicable percentage (as defined in paragraph (5)).
          (2) Applicable computed tomography services 
        defined.--In this subsection, the term ``applicable 
        computed tomography service'' means a service billed 
        using diagnostic radiological imaging codes for 
        computed tomography (identified as of January 1, 2014, 
        by HCPCS codes 70450-70498, 71250-71275, 72125-72133, 
        72191-72194, 73200-73206, 73700-73706, 74150-74178, 
        74261-74263, and 75571-75574 (and any succeeding 
        codes).
          (3) Applicable payment system defined.--In this 
        subsection, the term ``applicable payment system'' 
        means the following:
                  (A) The technical component and the technical 
                component of the global fee under the fee 
                schedule established under section 1848(b).
                  (B) The prospective payment system for 
                hospital outpatient department services under 
                section 1833(t).
          (4) Consistency with ct equipment standard.--In this 
        subsection, the term ``not consistent with the CT 
        equipment standard'' means, with respect to an 
        applicable computed tomography service, that the 
        service was furnished using equipment that does not 
        meet each of the attributes of the National Electrical 
        Manufacturers Association (NEMA) Standard XR-29-2013, 
        entitled ``Standard Attributes on CT Equipment Related 
        to Dose Optimization and Management''. Through 
        rulemaking, the Secretary may apply successor 
        standards.
          (5) Applicable percentage defined.--In this 
        subsection, the term ``applicable percentage'' means--
                  (A) for 2016, 5 percent; and
                  (B) for 2017 and subsequent years, 15 
                percent.
          (6) Implementation.--
                  (A) Information.--The Secretary shall require 
                that information be provided and attested to by 
                a supplier and a hospital outpatient department 
                that indicates whether an applicable computed 
                tomography service was furnished that was not 
                consistent with the CT equipment standard 
                (described in paragraph (4)). Such information 
                may be included on a claim and may be a 
                modifier. Such information shall be verified, 
                as appropriate, as part of the periodic 
                accreditation of suppliers under section 
                1834(e) and hospitals under section 1865(a).
                  (B) Administration.--Chapter 35 of title 44, 
                United States Code, shall not apply to 
                information described in subparagraph (A).
  (q) Recognizing Appropriate Use Criteria for Certain Imaging 
Services.--
          (1) Program established.--
                  (A) In general.--The Secretary shall 
                establish a program to promote the use of 
                appropriate use criteria (as defined in 
                subparagraph (B)) for applicable imaging 
                services (as defined in subparagraph (C)) 
                furnished in an applicable setting (as defined 
                in subparagraph (D)) by ordering professionals 
                and furnishing professionals (as defined in 
                subparagraphs (E) and (F), respectively).
                  (B) Appropriate use criteria defined.--In 
                this subsection, the term ``appropriate use 
                criteria'' means criteria, only developed or 
                endorsed by national professional medical 
                specialty societies or other provider-led 
                entities, to assist ordering professionals and 
                furnishing professionals in making the most 
                appropriate treatment decision for a specific 
                clinical condition for an individual. To the 
                extent feasible, such criteria shall be 
                evidence-based.
                  (C) Applicable imaging service defined.--In 
                this subsection, the term ``applicable imaging 
                service'' means an advanced diagnostic imaging 
                service (as defined in subsection (e)(1)(B)) 
                for which the Secretary determines--
                          (i) one or more applicable 
                        appropriate use criteria specified 
                        under paragraph (2) apply;
                          (ii) there are one or more qualified 
                        clinical decision support mechanisms 
                        listed under paragraph (3)(C); and
                          (iii) one or more of such mechanisms 
                        is available free of charge.
                  (D) Applicable setting defined.--In this 
                subsection, the term ``applicable setting'' 
                means a physician's office, a hospital 
                outpatient department (including an emergency 
                department), an ambulatory surgical center, and 
                any other provider-led outpatient setting 
                determined appropriate by the Secretary.
                  (E) Ordering professional defined.--In this 
                subsection, the term ``ordering professional'' 
                means a physician (as defined in section 
                1861(r)) or a practitioner described in section 
                1842(b)(18)(C) who orders an applicable imaging 
                service.
                  (F) Furnishing professional defined.--In this 
                subsection, the term ``furnishing 
                professional'' means a physician (as defined in 
                section 1861(r)) or a practitioner described in 
                section 1842(b)(18)(C) who furnishes an 
                applicable imaging service.
          (2) Establishment of applicable appropriate use 
        criteria.--
                  (A) In general.--Not later than November 15, 
                2015, the Secretary shall through rulemaking, 
                and in consultation with physicians, 
                practitioners, and other stakeholders, specify 
                applicable appropriate use criteria for 
                applicable imaging services only from among 
                appropriate use criteria developed or endorsed 
                by national professional medical specialty 
                societies or other provider-led entities.
                  (B) Considerations.--In specifying applicable 
                appropriate use criteria under subparagraph 
                (A), the Secretary shall take into account 
                whether the criteria--
                          (i) have stakeholder consensus;
                          (ii) are scientifically valid and 
                        evidence based; and
                          (iii) are based on studies that are 
                        published and reviewable by 
                        stakeholders.
                  (C) Revisions.--The Secretary shall review, 
                on an annual basis, the specified applicable 
                appropriate use criteria to determine if there 
                is a need to update or revise (as appropriate) 
                such specification of applicable appropriate 
                use criteria and make such updates or revisions 
                through rulemaking.
                  (D) Treatment of multiple applicable 
                appropriate use criteria.--In the case where 
                the Secretary determines that more than one 
                appropriate use criterion applies with respect 
                to an applicable imaging service, the Secretary 
                shall apply one or more applicable appropriate 
                use criteria under this paragraph for the 
                service.
          (3) Mechanisms for consultation with applicable 
        appropriate use criteria.--
                  (A) Identification of mechanisms to consult 
                with applicable appropriate use criteria.--
                          (i) In general.--The Secretary shall 
                        specify qualified clinical decision 
                        support mechanisms that could be used 
                        by ordering professionals to consult 
                        with applicable appropriate use 
                        criteria for applicable imaging 
                        services.
                          (ii) Consultation.--The Secretary 
                        shall consult with physicians, 
                        practitioners, health care technology 
                        experts, and other stakeholders in 
                        specifying mechanisms under this 
                        paragraph.
                          (iii) Inclusion of certain 
                        mechanisms.--Mechanisms specified under 
                        this paragraph may include any or all 
                        of the following that meet the 
                        requirements described in subparagraph 
                        (B)(ii):
                                  (I) Use of clinical decision 
                                support modules in certified 
                                EHR technology (as defined in 
                                section 1848(o)(4)).
                                  (II) Use of private sector 
                                clinical decision support 
                                mechanisms that are independent 
                                from certified EHR technology, 
                                which may include use of 
                                clinical decision support 
                                mechanisms available from 
                                medical specialty 
                                organizations.
                                  (III) Use of a clinical 
                                decision support mechanism 
                                established by the Secretary.
                  (B) Qualified clinical decision support 
                mechanisms.--
                          (i) In general.--For purposes of this 
                        subsection, a qualified clinical 
                        decision support mechanism is a 
                        mechanism that the Secretary determines 
                        meets the requirements described in 
                        clause (ii).
                          (ii) Requirements.--The requirements 
                        described in this clause are the 
                        following:
                                  (I) The mechanism makes 
                                available to the ordering 
                                professional applicable 
                                appropriate use criteria 
                                specified under paragraph (2) 
                                and the supporting 
                                documentation for the 
                                applicable imaging service 
                                ordered.
                                  (II) In the case where there 
                                is more than one applicable 
                                appropriate use criterion 
                                specified under such paragraph 
                                for an applicable imaging 
                                service, the mechanism 
                                indicates the criteria that it 
                                uses for the service.
                                  (III) The mechanism 
                                determines the extent to which 
                                an applicable imaging service 
                                ordered is consistent with the 
                                applicable appropriate use 
                                criteria so specified.
                                  (IV) The mechanism generates 
                                and provides to the ordering 
                                professional a certification or 
                                documentation that documents 
                                that the qualified clinical 
                                decision support mechanism was 
                                consulted by the ordering 
                                professional.
                                  (V) The mechanism is updated 
                                on a timely basis to reflect 
                                revisions to the specification 
                                of applicable appropriate use 
                                criteria under such paragraph.
                                  (VI) The mechanism meets 
                                privacy and security standards 
                                under applicable provisions of 
                                law.
                                  (VII) The mechanism performs 
                                such other functions as 
                                specified by the Secretary, 
                                which may include a requirement 
                                to provide aggregate feedback 
                                to the ordering professional.
                  (C) List of mechanisms for consultation with 
                applicable appropriate use criteria.--
                          (i) Initial list.--Not later than 
                        April 1, 2016, the Secretary shall 
                        publish a list of mechanisms specified 
                        under this paragraph.
                          (ii) Periodic updating of list.--The 
                        Secretary shall identify on an annual 
                        basis the list of qualified clinical 
                        decision support mechanisms specified 
                        under this paragraph.
          (4) Consultation with applicable appropriate use 
        criteria.--
                  (A) Consultation by ordering professional.--
                Beginning with January 1, 2017, subject to 
                subparagraph (C), with respect to an applicable 
                imaging service ordered by an ordering 
                professional that would be furnished in an 
                applicable setting and paid for under an 
                applicable payment system (as defined in 
                subparagraph (D)), an ordering professional 
                shall--
                          (i) consult with a qualified decision 
                        support mechanism listed under 
                        paragraph (3)(C); and
                          (ii) provide to the furnishing 
                        professional the information described 
                        in clauses (i) through (iii) of 
                        subparagraph (B).
                  (B) Reporting by furnishing professional.--
                Beginning with January 1, 2017, subject to 
                subparagraph (C), with respect to an applicable 
                imaging service furnished in an applicable 
                setting and paid for under an applicable 
                payment system (as defined in subparagraph 
                (D)), payment for such service may only be made 
                if the claim for the service includes the 
                following:
                          (i) Information about which qualified 
                        clinical decision support mechanism was 
                        consulted by the ordering professional 
                        for the service.
                          (ii) Information regarding--
                                  (I) whether the service 
                                ordered would adhere to the 
                                applicable appropriate use 
                                criteria specified under 
                                paragraph (2);
                                  (II) whether the service 
                                ordered would not adhere to 
                                such criteria; or
                                  (III) whether such criteria 
                                was not applicable to the 
                                service ordered.
                          (iii) The national provider 
                        identifier of the ordering professional 
                        (if different from the furnishing 
                        professional).
                  (C) Exceptions.--The provisions of 
                subparagraphs (A) and (B) and paragraph (6)(A) 
                shall not apply to the following:
                          (i) Emergency services.--An 
                        applicable imaging service ordered for 
                        an individual with an emergency medical 
                        condition (as defined in section 
                        1867(e)(1)).
                          (ii) Inpatient services.--An 
                        applicable imaging service ordered for 
                        an inpatient and for which payment is 
                        made under part A.
                          (iii) Significant hardship.--An 
                        applicable imaging service ordered by 
                        an ordering professional who the 
                        Secretary may, on a case-by-case basis, 
                        exempt from the application of such 
                        provisions if the Secretary determines, 
                        subject to annual renewal, that 
                        consultation with applicable 
                        appropriate use criteria would result 
                        in a significant hardship, such as in 
                        the case of a professional who 
                        practices in a rural area without 
                        sufficient Internet access.
                  (D) Applicable payment system defined.--In 
                this subsection, the term ``applicable payment 
                system'' means the following:
                          (i) The physician fee schedule 
                        established under section 1848(b).
                          (ii) The prospective payment system 
                        for hospital outpatient department 
                        services under section 1833(t).
                          (iii) The ambulatory surgical center 
                        payment systems under section 1833(i).
          (5) Identification of outlier ordering 
        professionals.--
                  (A) In general.--With respect to applicable 
                imaging services furnished beginning with 2017, 
                the Secretary shall determine, on an annual 
                basis, no more than five percent of the total 
                number of ordering professionals who are 
                outlier ordering professionals.
                  (B) Outlier ordering professionals.--The 
                determination of an outlier ordering 
                professional shall--
                          (i) be based on low adherence to 
                        applicable appropriate use criteria 
                        specified under paragraph (2), which 
                        may be based on comparison to other 
                        ordering professionals; and
                          (ii) include data for ordering 
                        professionals for whom prior 
                        authorization under paragraph (6)(A) 
                        applies.
                  (C) Use of two years of data.--The Secretary 
                shall use two years of data to identify outlier 
                ordering professionals under this paragraph.
                  (D) Process.--The Secretary shall establish a 
                process for determining when an outlier 
                ordering professional is no longer an outlier 
                ordering professional.
                  (E) Consultation with stakeholders.--The 
                Secretary shall consult with physicians, 
                practitioners and other stakeholders in 
                developing methods to identify outlier ordering 
                professionals under this paragraph.
          (6) Prior authorization for ordering professionals 
        who are outliers.--
                  (A) In general.--Beginning January 1, 2020, 
                subject to paragraph (4)(C), with respect to 
                services furnished during a year, the Secretary 
                shall, for a period determined appropriate by 
                the Secretary, apply prior authorization for 
                applicable imaging services that are ordered by 
                an outlier ordering professional identified 
                under paragraph (5).
                  (B) Appropriate use criteria in prior 
                authorization.--In applying prior authorization 
                under subparagraph (A), the Secretary shall 
                utilize only the applicable appropriate use 
                criteria specified under this subsection.
                  (C) Funding.--For purposes of carrying out 
                this paragraph, the Secretary shall provide for 
                the transfer, from the Federal Supplementary 
                Medical Insurance Trust Fund under section 
                1841, of $5,000,000 to the Centers for Medicare 
                & Medicaid Services Program Management Account 
                for each of fiscal years 2019 through 2021. 
                Amounts transferred under the preceding 
                sentence shall remain available until expended.
          (7) Construction.--Nothing in this subsection shall 
        be construed as granting the Secretary the authority to 
        develop or initiate the development of clinical 
        practice guidelines or appropriate use criteria.
  (r) Payment for Renal Dialysis Services for Individuals With 
Acute Kidney Injury.--
          (1) Payment rate.--In the case of renal dialysis 
        services (as defined in subparagraph (B) of section 
        1881(b)(14)) furnished under this part by a renal 
        dialysis facility or provider of services paid under 
        such section during a year (beginning with 2017) to an 
        individual with acute kidney injury (as defined in 
        paragraph (2)), the amount of payment under this part 
        for such services shall be the base rate for renal 
        dialysis services determined for such year under such 
        section, as adjusted by any applicable geographic 
        adjustment factor applied under subparagraph 
        (D)(iv)(II) of such section and may be adjusted by the 
        Secretary (on a budget neutral basis for payments under 
        this paragraph) by any other adjustment factor under 
        subparagraph (D) of such section.
          (2) Individual with acute kidney injury defined.--In 
        this subsection, the term ``individual with acute 
        kidney injury'' means an individual who has acute loss 
        of renal function and does not receive renal dialysis 
        services for which payment is made under section 
        1881(b)(14).
  (s) Payment for Applicable Disposable Devices.--
          (1) Separate payment.--The Secretary shall make a 
        payment (separate from the payments otherwise made 
        under section 1895) in the amount established under 
        paragraph (3) to a home health agency for an applicable 
        disposable device (as defined in paragraph (2)) when 
        furnished on or after January 1, 2017, to an individual 
        who receives home health services for which payment is 
        made under section 1895(b).
          (2) Applicable disposable device.--In this 
        subsection, the term applicable disposable device means 
        a disposable device that, as determined by the 
        Secretary, is--
                  (A) a disposable negative pressure wound 
                therapy device that is an integrated system 
                comprised of a non-manual vacuum pump, a 
                receptacle for collecting exudate, and 
                dressings for the purposes of wound therapy; 
                and
                  (B) a substitute for, and used in lieu of, a 
                negative pressure wound therapy durable medical 
                equipment item that is an integrated system of 
                a negative pressure vacuum pump, a separate 
                exudate collection canister, and dressings that 
                would otherwise be covered for individuals for 
                such wound therapy.
          (3) Payment amount.--The separate payment amount 
        established under this paragraph for an applicable 
        disposable device for a year shall be equal to the 
        amount of the payment that would be made under section 
        1833(t) (relating to payment for covered OPD services) 
        for the year for the Level I Healthcare Common 
        Procedure Coding System (HCPCS) code for which the 
        description for a professional service includes the 
        furnishing of such device.
  (t) Site-of-Service Price Transparency.--
          (1) In general.--In order to facilitate price 
        transparency with respect to items and services for 
        which payment may be made either to a hospital 
        outpatient department or to an ambulatory surgical 
        center under this title, the Secretary shall, for 2018 
        and each year thereafter, make available to the public 
        via a searchable Internet website, with respect to an 
        appropriate number of such items and services--
                  (A) the estimated payment amount for the item 
                or service under the outpatient department fee 
                schedule under subsection (t) of section 1833 
                and the ambulatory surgical center payment 
                system under subsection (i) of such section; 
                and
                  (B) the estimated amount of beneficiary 
                liability applicable to the item or service.
          (2) Calculation of estimated beneficiary liability.--
        For purposes of paragraph (1)(B), the estimated amount 
        of beneficiary liability, with respect to an item or 
        service, is the amount for such item or service for 
        which an individual who does not have coverage under a 
        Medicare supplemental policy certified under section 
        1882 or any other supplemental insurance coverage is 
        responsible.
          (3) Implementation.--In carrying out this subsection, 
        the Secretary--
                  (A) shall include in the notice described in 
                section 1804(a) a notification of the 
                availability of the estimated amounts made 
                available under paragraph (1); and
                  (B) may utilize mechanisms in existence on 
                the date of enactment of this subsection, such 
                as the portion of the Internet website of the 
                Centers for Medicare & Medicaid Services on 
                which information comparing physician 
                performance is posted (commonly referred to as 
                the Physician Compare Internet website), to 
                make available such estimated amounts under 
                such paragraph.
          (4) Funding.--For purposes of implementing this 
        subsection, the Secretary shall provide for the 
        transfer, from the Federal Supplementary Medical 
        Insurance Trust Fund under section 1841 to the Centers 
        for Medicare & Medicaid Services Program Management 
        Account, of $6,000,000 for fiscal year 2017, to remain 
        available until expended.
  (u) Payment and Related Requirements for Home Infusion 
Therapy.--
          (1) Payment.--
                  (A) Single payment.--
                          (i) In general.--Subject to clause 
                        (iii) and subparagraphs (B) and (C), 
                        the Secretary shall implement a payment 
                        system under which a single payment is 
                        made under this title to a qualified 
                        home infusion therapy supplier for 
                        items and services described in 
                        subparagraphs (A) and (B) of section 
                        1861(iii)(2)) furnished by a qualified 
                        home infusion therapy supplier (as 
                        defined in section 1861(iii)(3)(D)) in 
                        coordination with the furnishing of 
                        home infusion drugs (as defined in 
                        section 1861(iii)(3)(C)) under this 
                        part.
                          (ii) Unit of single payment.--A unit 
                        of single payment under the payment 
                        system implemented under this 
                        subparagraph is for each infusion drug 
                        administration calendar day in the 
                        individual's home. The Secretary shall, 
                        as appropriate, establish single 
                        payment amounts for types of infusion 
                        therapy, including to take into account 
                        variation in utilization of nursing 
                        services by therapy type.
                          (iii) Limitation.--The single payment 
                        amount determined under this 
                        subparagraph after application of 
                        subparagraph (B) and paragraph (3) 
                        shall not exceed the amount determined 
                        under the fee schedule under section 
                        1848 for infusion therapy services 
                        furnished in a calendar day if 
                        furnished in a physician office 
                        setting, except such single payment 
                        shall not reflect more than 5 hours of 
                        infusion for a particular therapy in a 
                        calendar day.
                  (B) Required adjustments.--The Secretary 
                shall adjust the single payment amount 
                determined under subparagraph (A) for home 
                infusion therapy services under section 
                1861(iii)(1) to reflect other factors such as--
                          (i) a geographic wage index and other 
                        costs that may vary by region; and
                          (ii) patient acuity and complexity of 
                        drug administration.
                  (C) Discretionary adjustments.--
                          (i) In general.--Subject to clause 
                        (ii), the Secretary may adjust the 
                        single payment amount determined under 
                        subparagraph (A) (after application of 
                        subparagraph (B)) to reflect outlier 
                        situations and other factors as the 
                        Secretary determines appropriate.
                          (ii) Requirement of budget 
                        neutrality.--Any adjustment under this 
                        subparagraph shall be made in a budget 
                        neutral manner.
          (2) Considerations.--In developing the payment system 
        under this subsection, the Secretary may consider the 
        costs of furnishing infusion therapy in the home, 
        consult with home infusion therapy suppliers, consider 
        payment amounts for similar items and services under 
        this part and part A, and consider payment amounts 
        established by Medicare Advantage plans under part C 
        and in the private insurance market for home infusion 
        therapy (including average per treatment day payment 
        amounts by type of home infusion therapy).
          (3) Annual updates.--
                  (A) In general.--Subject to subparagraph (B), 
                the Secretary shall update the single payment 
                amount under this subsection from year to year 
                beginning in 2022 by increasing the single 
                payment amount from the prior year by the 
                percentage increase in the Consumer Price Index 
                for all urban consumers (United States city 
                average) for the 12-month period ending with 
                June of the preceding year.
                  (B) Adjustment.--For each year, the Secretary 
                shall reduce the percentage increase described 
                in subparagraph (A) by the productivity 
                adjustment described in section 
                1886(b)(3)(B)(xi)(II). The application of the 
                preceding sentence may result in a percentage 
                being less than 0.0 for a year, and may result 
                in payment being less than such payment rates 
                for the preceding year.
          (4) Authority to apply prior authorization.--The 
        Secretary may, as determined appropriate by the 
        Secretary, apply prior authorization for home infusion 
        therapy services under section 1861(iii)(1).
          (5) Accreditation of qualified home infusion therapy 
        suppliers.--
                  (A) Factors for designation of accreditation 
                organizations.--The Secretary shall consider 
                the following factors in designating 
                accreditation organizations under subparagraph 
                (B) and in reviewing and modifying the list of 
                accreditation organizations designated pursuant 
                to subparagraph (C):
                          (i) The ability of the organization 
                        to conduct timely reviews of 
                        accreditation applications.
                          (ii) The ability of the organization 
                        to take into account the capacities of 
                        suppliers located in a rural area (as 
                        defined in section 1886(d)(2)(D)).
                          (iii) Whether the organization has 
                        established reasonable fees to be 
                        charged to suppliers applying for 
                        accreditation.
                          (iv) Such other factors as the 
                        Secretary determines appropriate.
                  (B) Designation.--Not later than January 1, 
                2021, the Secretary shall designate 
                organizations to accredit suppliers furnishing 
                home infusion therapy. The list of 
                accreditation organizations so designated may 
                be modified pursuant to subparagraph (C).
                  (C) Review and modification of list of 
                accreditation organizations.--
                          (i) In general.--The Secretary shall 
                        review the list of accreditation 
                        organizations designated under 
                        subparagraph (B) taking into account 
                        the factors under subparagraph (A). 
                        Taking into account the results of such 
                        review, the Secretary may, by 
                        regulation, modify the list of 
                        accreditation organizations designated 
                        under subparagraph (B).
                          (ii) Special rule for accreditations 
                        done prior to removal from list of 
                        designated accreditation 
                        organizations.--In the case where the 
                        Secretary removes an organization from 
                        the list of accreditation organizations 
                        designated under subparagraph (B), any 
                        supplier that is accredited by the 
                        organization during the period 
                        beginning on the date on which the 
                        organization is designated as an 
                        accreditation organization under 
                        subparagraph (B) and ending on the date 
                        on which the organization is removed 
                        from such list shall be considered to 
                        have been accredited by an organization 
                        designated by the Secretary under 
                        subparagraph (B) for the remaining 
                        period such accreditation is in effect.
                  (D) Rule for accreditations made prior to 
                designation.--In the case of a supplier that is 
                accredited before January 1, 2021, by an 
                accreditation organization designated by the 
                Secretary under subparagraph (B) as of January 
                1, 2019, such supplier shall be considered to 
                have been accredited by an organization 
                designated by the Secretary under such 
                paragraph as of January 1, 2023, for the 
                remaining period such accreditation is in 
                effect.
          (6) Notification of infusion therapy options 
        available prior to furnishing home infusion therapy.--
        Prior to the furnishing of home infusion therapy to an 
        individual, the physician who establishes the plan 
        described in section 1861(iii)(1) for the individual 
        shall provide notification (in a form, manner, and 
        frequency determined appropriate by the Secretary) of 
        the options available (such as home, physician's 
        office, hospital outpatient department) for the 
        furnishing of infusion therapy under this part.

           *       *       *       *       *       *       *

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]