HR 5001 IH
106th CONGRESS
2d Session
H. R. 5001
To amend title XVIII of the Social Security Act to provide for
equitable payments to providers of services under the Medicare Program, and to
amend title XIX of such Act to provide for coverage of additional children under
the Medicaid Program.
IN THE HOUSE OF REPRESENTATIVES
July 27, 2000
Mrs. Wilson (for herself, Mr. Luther, Mr. RYAN of Wisconsin, Ms. Hooley of
Oregon, Mr. Sabo, and Mr. Minge) introduced the following bill; which was
referred to the Committee on Commerce, and in addition to the Committee on Ways
and Means, for a period to be subsequently determined by the Speaker, in each
case for consideration of such provisions as fall within the jurisdiction of the
committee concerned
A BILL
To amend title XVIII of the Social Security Act to provide for
equitable payments to providers of services under the Medicare Program, and to
amend title XIX of such Act to provide for coverage of additional children under
the Medicaid Program.
Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECURITY ACT; TABLE OF
CONTENTS.
(a) SHORT TITLE- This Act may be cited as the `Fair Care for Seniors and
Children Act of 2000'.
(b) AMENDMENTS TO SOCIAL SECURITY ACT- Except as otherwise specifically
provided, whenever in this Act an amendment is expressed in terms of an
amendment to or repeal of a section or other provision, the reference shall be
considered to be made to that section or other provision of the Social
Security Act.
(c) TABLE OF CONTENTS- The table of contents of this Act is as follows:
Sec. 1. Short title; amendments to Social Security Act; table of
contents.
TITLE I--MEDICARE PROGRAM
Subtitle A--Medicare+Choice Program
Sec. 101. Increasing minimum payment amount.
Sec. 102. Increase in national per capita Medicare+Choice growth
percentage in 2001 and 2002.
Sec. 103. Permanently removing application of budget neutrality
beginning in 2001.
Sec. 104. Allowing movement to 50:50 percent blend in 2001.
Sec. 105. Increased update for payment areas with only one or no
Medicare+Choice contracts.
Sec. 106. Permitting higher negotiated rates in certain Medicare+Choice
payment areas below national average.
Sec. 107. Reasonable cost reimbursement for payment areas with no more
than one medicare+choice contract.
Sec. 108. 10-Year phase in of risk adjustment based on data from all
settings.
Sec. 109. Delay from July to November 2000 in deadline for offering and
withdrawing Medicare+Choice plans for 2001.
Subtitle B--Inpatient Hospital Services
Sec. 111. Elimination of authority to estimate costs incurred by a
hospital for wages.
Subtitle C--Home Health Services
Sec. 121. Elimination of 15 percent reduction in payment rates under the
medicare prospective payment system for home health services.
TITLE II--MEDICAID PROGRAM
Subtitle A--Expansion of Coverage of Children under the Medicaid
Program
Sec. 201. Use of State Children's Health Insurance Program funds for
enhanced matching rate for coverage of additional children under the
medicaid program.
Sec. 202. Expansion of presumptive eligibility option for children under
the medicaid program.
Sec. 203. Increased SCHIP flexibility for states with high medicaid
child income levels when SCHIP initiated.
Subtitle B--Prospective Payment System for Federally-qualified Health
Centers and Rural Health Clinics
Sec. 211. Establishment of prospective payment system for
federally-qualified health centers and rural health clinics.
TITLE I--MEDICARE PROGRAM
Subtitle A--Medicare+Choice Program
SEC. 101. INCREASING MINIMUM PAYMENT AMOUNT.
Section 1853(c)(1)(B)(ii) (42 U.S.C. 1395w-23(c)(1)(B)(ii)) is
amended--
(1) by striking `(ii) For a succeeding year' and inserting `(ii)(I)
Subject to subclause (II), for a succeeding year'; and
(2) by adding at the end the following new subclause:
`(II) For 2001 for any area in a Metropolitan Statistical Area with
a population of more than 250,000, $525 (and for any other area,
$475).'.
SEC. 102. INCREASE IN NATIONAL PER CAPITA MEDICARE+CHOICE GROWTH PERCENTAGE
IN 2001 AND 2002.
Section 1853(c)(6)(B) (42 U.S.C. 1395w-23(c)(6)(B)) is amended--
(1) in clause (iv), by striking `for 2001, 0.5 percentage points' and
inserting `for 2001, 0 percentage points'; and
(2) in clause (v), by striking `for 2002, 0.3 percentage points' and
inserting `for 2002, 0 percentage points'.
SEC. 103. PERMANENTLY REMOVING APPLICATION OF BUDGET NEUTRALITY BEGINNING IN
2002.
Section 1853(c) (42 U.S.C. 1395w-23(c)) is amended--
(1) in paragraph (1)(A), in the matter following clause (ii), by
inserting `(for years before 2001)' after `multiplied'; and
(2) in paragraph (5), by inserting `(before 2001)' after `for each
year'.
SEC. 104. ALLOWING MOVEMENT TO 50:50 PERCENT BLEND IN 2001.
Section 1853(c)(2) (42 U.S.C. 1395w-23(c)(2)) is amended--
(1) by adding `and' at the end of subparagraph (C);
(2) by striking subparagraphs (D) and (E);
(3) by redesignating subparagraph (F) and subparagraph (D); and
(4) in subparagraph (D), as so redesignated, by striking `2002' and
inserting `2000'.
SEC. 105. INCREASED UPDATE FOR PAYMENT AREAS WITH ONLY ONE OR NO
MEDICARE+CHOICE CONTRACTS.
(a) IN GENERAL- Section 1853(c)(1)(C)(ii) (42 U.S.C.
1395w-23(c)(1)(C)(ii)) is amended--
(1) by striking `(ii) For a subsequent year' and inserting `(ii)(I)
Subject to subclause (II), for a subsequent year'; and
(2) by adding at the end the following new subclause:
`(II) During 2001, 2002, 2003, 2004, and 2005, in the case of a
Medicare+Choice payment area in which there is no more than one contract
entered into under this part as of July 1 before the beginning of the
year, 102.5 percent of the annual Medicare+Choice capitation rate under
this paragraph for the area for the previous year.'.
(b) CONSTRUCTION- The amendments made by subsection (a) do not affect the
payment of a first-time bonus under section 1853(i) of the Social Security Act
(42 U.S.C. 1395w-23(i)).
SEC. 106. PERMITTING HIGHER NEGOTIATED RATES IN CERTAIN MEDICARE+CHOICE
PAYMENT AREAS BELOW NATIONAL AVERAGE.
Section 1853(c)(1) (42 U.S.C. 1395w-23(c)(1)) is amended--
(1) in the matter before subparagraph (A), by striking `or (C)' and
inserting `(C), or (D)'; and
(2) by adding at the end the following new subparagraph:
`(D) PERMITTING HIGHER RATES THROUGH NEGOTIATION-
`(i) IN GENERAL- For each year beginning with 2001, in the case of a
Medicare+Choice payment area for which the Medicare+Choice capitation
rate under this paragraph would otherwise be less than the United States
per capita cost (USPCC), as calculated by the Secretary, a
Medicare+Choice organization may negotiate with the Secretary an annual
per capita rate that--
`(I) reflects an annual rate of increase up to the rate of
increase specified in clause (ii);
`(II) takes into account audited current data supplied by the
organization on its adjusted community rate (as defined in section
1854(f)(3)); and
`(III) does not exceed the United States per capita cost, as
projected by the Secretary for the year involved.
`(ii) MAXIMUM RATE DESCRIBED- The rate of increase specified in this
clause for a year is the rate of inflation in private health insurance
for the year involved, as projected by the Secretary, and includes such
adjustments as may be necessary to reflect the demographic
characteristics in the population under this title.
`(iii) ADJUSTMENTS FOR OVER OR UNDER PROJECTIONS- If this
subparagraph is applied to an organization and payment area for a year,
in applying this subparagraph for a subsequent year the provisions of
paragraph (6)(C) shall apply in the same manner as such provisions apply
under this paragraph.'.
SEC. 107. REASONABLE COST REIMBURSEMENT FOR PAYMENT AREAS WITH NO MORE THAN
ONE MEDICARE+CHOICE CONTRACT.
(a) IN GENERAL- Section 1853 (42 U.S.C. 1395w-23) is amended--
(1) in subsection (a)(1)(A) by striking `(g), and (i)' and inserting
`(g), (i), and (j)'; and
(2) by adding at the end the following new subsection:
`(j) REASONABLE COST REIMBURSEMENT FOR PAYMENT AREAS WITH NO MORE THAN ONE
MEDICARE+CHOICE CONTRACT-
`(1) IN GENERAL- Subject to paragraph (2), in the case of a
Medicare+Choice payment area in which there is no more than 1 contract
entered into under this part as of July 1 before the beginning of the
following year, at the election of a Medicare+Choice organization the amount
of payment under this section for such following year for enrollment under a
Medicare+Choice plan offered by the organization in that area shall be the
amount of payment otherwise applicable to an eligible organization that has
entered into a reasonable cost reimbursement contract with the Secretary
under section 1876(h).
`(2) LIMITATION- A Medicare+Choice organization that has negotiated a
higher an annual per capita rate under subsection (c)(1)(D) for a year may
not elect reimbursement under paragraph (1) for that year.'.
SEC. 108. 10-YEAR PHASE IN OF RISK ADJUSTMENT BASED ON DATA FROM ALL
SETTINGS.
Section 1853(a)(3)(C)(ii) (42 U.S.C. 1395w-23(c)(1)(C)(ii)) is
amended--
(1) by striking the period at the end of subclause (II) and inserting a
semicolon; and
(2) by adding after and below subclause (II) the following:
`and, beginning in 2004, insofar as such risk adjustment is based on
data from all settings, the methodology shall be phased in in equal
increments over a 10-year period, beginning with 2004 or (if later) the
first year in which such data are used.'.
SEC. 109. DELAY FROM JULY TO NOVEMBER 2000 IN DEADLINE FOR OFFERING AND
WITHDRAWING MEDICARE+CHOICE PLANS FOR 2001.
Notwithstanding any other provision of law, the deadline for a
Medicare+Choice organization to withdraw the offering of a Medicare+Choice
plan under part C of title XVIII of the Social Security Act (or otherwise to
submit information required for the offering of such a plan) for 2001 is
delayed from July 1, 2000, to October 1, 2000, and any such organization that
provided notice of withdrawal of such a plan during 2000 before the date of
the enactment of this Act may rescind such withdrawal at any time before
November 1, 2000.
Subtitle B--Inpatient Hospital Services
SEC. 111. ELIMINATION OF AUTHORITY TO ESTIMATE COSTS INCURRED BY A HOSPITAL
FOR WAGES.
(a) IN GENERAL- The first sentence of section 1886(d)(3)(E) (42 U.S.C.
1395ww(d)(3)(E)) is amended by striking `, (as estimated by the Secretary from
time to time) of hospitals' costs' and inserting `of each hospital's costs
(based on the most recent data available to the Secretary with respect to each
hospital)'.
(b) SPECIAL RULE FOR PUERTO RICO HOSPITALS- Section 1886(d)(3)(E) (42
U.S.C. 1395ww(d)(3)(E)) is amended by adding at the end the following new
sentence: `In the case of a subsection (d) Puerto Rico hospital, the first
sentence of this subparagraph shall be applied as in effect on the date that
precedes the date of the enactment of the Fair Care for Seniors and Children
Act of 2000.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply with
respect to discharges occurring on or after January 1, 2001.
Subtitle C--Home Health Services
SEC. 121. ELIMINATION OF 15 PERCENT REDUCTION IN PAYMENT RATES UNDER THE
MEDICARE PROSPECTIVE PAYMENT SYSTEM FOR HOME HEALTH SERVICES.
(a) IN GENERAL- Section 1895(b)(3)(A) (42 U.S.C. 1395fff(b)(3)(A)), as
amended by sections 302(b) and 303(f) of the Medicare, Medicaid, and SCHIP
Balanced Budget Refinement Act of 1999 (113 Stat. 1501A-359, 361), as enacted
into law by section 1000(a)(6) of Public Law 106-113, is amended to read as
follows:
`(A) INITIAL BASIS- Under such system the Secretary shall provide for
computation of a standard prospective payment amount (or amounts). Such
amount (or amounts) shall initially be based on the most current audited
cost report data available to the Secretary and shall be computed in a
manner so that the total amounts payable under the system for the 12-month
period beginning on the date the Secretary implements the system shall be
equal to the total amount that would have been made if the system had not
been in effect and if section 1861(v)(1)(L)(ix) had not been enacted. Each
such amount shall be standardized in a manner that eliminates the effect
of variations in relative case mix and area wage adjustments among
different home health agencies in a budget neutral manner consistent with
the case mix and wage level adjustments provided under paragraph (4)(A).
Under the system, the Secretary may recognize regional differences or
differences based upon whether or not the services or agency are in an
urbanized area.'.
(b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect
as if included in the enactment of the Medicare, Medicaid, and SCHIP Balanced
Budget Refinement Act of 1999 (Public Law 106-113).
TITLE II--MEDICAID PROGRAM
Subtitle A--Expansion of Coverage of Children under the Medicaid
Program
SEC. 201. USE OF STATE CHILDREN'S HEALTH INSURANCE PROGRAM FUNDS FOR
ENHANCED MATCHING RATE FOR COVERAGE OF ADDITIONAL CHILDREN UNDER THE MEDICAID
PROGRAM.
(a) IN GENERAL- Section 1905 (42 U.S.C. 1396d) is amended--
(1) in subsection (b), by striking `or subsection (u)(3)' and inserting
`, subsection (u)(3), or subsection (u)(4)(A)'; and
(2) in subsection (u) (as added by section 4911(a)(2) of the Balanced
Budget Act of 1997 and as amended by section 162 of Public Law
105-100)--
(A) by redesignating paragraph (4) as paragraph (5); and
(B) by inserting after paragraph (3) the following new
paragraph:
`(4)(A) For purposes of subsection (b), the expenditures described in this
subparagraph are expenditures for medical assistance for waivered low-income
children described in subparagraph (B) but--
`(i) only in the case of children residing in a State described in
subparagraph (C); and
`(ii) only to the extent the number of full-year equivalent waivered
low-income children enrolled under the State plan under this title for the
fiscal year exceeds the number of waivered low-income children described in
subparagraph (D)(i) for the State for the fiscal year.
`(B) For purposes of this paragraph, the term `waivered low-income child'
means a child whose family income exceeds the minimum income level required to
be established for the age of such child under section 1902(l)(2) in order for
the child to be eligible for medical assistance under this title, but does not
exceed the medicaid applicable income level (as defined in section 2110(b)(4)
but determined as if `June 1, 1997' were substituted for `March 31, 1997') for
that child.
`(C) A State described in this subparagraph is a State that--
`(i) has under a waiver authorized by the Secretary or under section
1902(r)(2) established a medicaid applicable income level (as defined in
section 2110(b)(4) but determined as if `June 1, 1997' were substituted for
`March 31, 1997') for children
under 19 years of age residing in the State that is at or above 185 percent
of the poverty line; and
`(ii) demonstrates to the satisfaction of the Secretary a commitment to
reach and enroll children who are eligible for, but not enrolled under, the
State plan through means, such as the following:
`(I) Eliminating the assets test for eligibility of waivered
low-income children.
`(II) Using shortened and simplified applications for such
children.
`(III) Allowing applications for such children to be submitted by mail
or through telephone.
`(IV) Outstationing State eligibility workers at sites that are
frequented by families with children, including schools, child care
centers, churches, centers providing Head Start services, local offices of
the special supplemental food program for women, infants and young
children (WIC) established under section 17 of the Child Nutrition Act of
1966, community centers, Job Corps centers established under part B of
title IV of the Job Training Partnership Act or subtitle C of title I of
the Workforce Investment Act of 1998, sites offering the recognized
equivalent of a secondary school degree, offices of tribal organizations
(as defined in section 4(l) of the Indian Self-Determination and Education
Assistance Act), and Social Security Administration field
offices.
`(V) Using presumptive eligibility for waivered low-income
children.
`(VI) Collaborating with public and private entities to conduct
outreach campaigns to enroll such children.
`(D)(i) For purposes of subparagraph (A)(ii), the number of waivered
low-income children for a State described in this clause for--
`(I) fiscal year 1998, is equal to the number of full-year equivalent
waivered low-income children enrolled under the State plan under this title
for fiscal year 1997; and
`(II) fiscal year 1999 or a succeeding fiscal year, is equal to the
number of waivered low-income children determined under this clause for the
preceding fiscal year increased by the number of percentage points
determined under clause (ii) for the State for the fiscal year
involved.
`(ii) The number of percentage points determined under this clause for a
State for a fiscal year is equal to the number of percentage points by
which--
`(I) the arithmetic average of the total number of children in the State
set forth in the 3 most recent March supplements to the Current Population
Survey of the Bureau of the Census before the beginning of the fiscal year;
exceeds
`(II) the arithmetic average of such total number set forth in the
second, third, and fourth most recent March supplements to such Survey
before the beginning of the fiscal year.
`(E) For purposes of section 2104(d) (regarding the reduction of an
allotment under title XXI) the amount determined under paragraph (2) of that
section shall, with respect to expenditures described in subparagraph (A),
only take into account the amount by which--
`(i) the payments made to a State for such expenditures for a fiscal
year on the basis of an enhanced FMAP under the fourth sentence of
subsection (b); exceed
`(ii) the amount of payments that would have been made for the
expenditures if the enhanced FMAP did not apply.
`(F) Each State shall submit to the Secretary such information, at such
time and in such manner, as the Secretary determines is necessary to ensure
that the requirements of this paragraph are satisfied. The Secretary shall
ensure that information is provided under this subsection in a manner that is
consistent with other reporting requirements for information required to be
submitted by a State under this title and title XXI, and avoids duplication of
reporting requirements.
`(G) The Secretary shall regularly examine the payments made to a State
for the expenditures described in subparagraph (A) to confirm that the
payments are attributable to expenditures described in such subparagraph.'.
(b) CONFORMING AMENDMENT- Section 2104(d)(2) (42 U.S.C. 1397dd(d)(2)) is
amended by inserting `subject to section 1905(u)(4)(E),' after `(2)'.
(c) EFFECTIVE DATE- The amendments made by this section shall be effective
as if included in the enactment of section 4911 of the Balanced Budget Act of
1997.
SEC. 202. EXPANSION OF PRESUMPTIVE ELIGIBILITY OPTION FOR CHILDREN UNDER THE
MEDICAID PROGRAM.
(a) IN GENERAL- Section 1920A(b)(3)(A)(i) (42 U.S.C. 1396r-1a(b)(3)(A)(i))
is amended--
(1) by striking `or (II)' and inserting `, (II)'; and
(2) by inserting before the semicolon `, eligibility for assistance
under the State plan under part A of title IV, eligibility of a child to
receive medical assistance under the State plan under this title or title
XXI, (III) is a staff member of an elementary school or secondary school, as
such terms are defined in section 14101 of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 8801), a child care resource and referral
center, or an agency administering a State plan under part D of title IV, or
(IV) is so designated by the State'.
(b) CONFORMING AMENDMENTS- Section 1920A (42 U.S.C. 1396r-1a) is
amended--
(1) in subsection (b)(3)(A)(ii), by striking `paragraph (1)(A)' and
inserting `paragraph (2)(A)'; and
(2) in subsection (c)(2), in the matter preceding subparagraph (A), by
striking `subsection (b)(1)(A)' and inserting `subsection (b)(2)(A)'.
SEC. 203. INCREASED SCHIP FLEXIBILITY FOR STATES WITH HIGH MEDICAID CHILD
INCOME LEVELS WHEN SCHIP INITIATED.
(a) USE OF ENHANCED MATCH FOR EXPANDED MEDICAID CHILD COVERAGE- Section
1905 (42 U.S.C. 1396d), as amended by section 201, is further amended--
(1) in subsection (b), by striking `or subsection (u)(4)(A)' and
inserting `, subsection (u)(4)(A), or subsection (u)(5)(A)'; and
(A) by redesignating paragraph (5) as paragraph (6); and
(B) by inserting after paragraph (4) the following new
paragraph:
`(5)(A) For purposes of subsection (b), the expenditures described in this
subparagraph are expenditures for medical assistance for expansion children
(as defined in subparagraph (B)) but--
`(i) only in the case of expansion children residing in a State that
has, under a waiver authorized by the Secretary under section 1115 or under
section 1902(r)(2), established a medicaid applicable income level (as
defined in section 2110(b)(4)) for children under 19 years of age residing
in the State that is at or above 185 percent of the poverty line; and
`(ii) only for a fiscal year to the extent the full-year equivalent
number of expansion children enrolled under the State plan under this title
for the fiscal year exceeds the number of such children enrolled under the
plan for the State during the first month in which the State's child health
plan under title XXI was effective.
`(B) For purposes of this paragraph, the term `expansion child' means a
child who is eligible for medical assistance under this title only due to a
waiver described in subparagraph (A)(i), and whose family income does not
exceed the medicaid applicable income level (as defined in section 2110(b)(4))
for that child.'.
(b) APPLICATION OF INCREASED PROPORTION OF SCHIP ALLOTMENT FOR SPECIAL
INITIATIVES AND SIMILAR PURPOSES- Section 2105(c)(2) of such Act (42 U.S.C.
1397ee(c)(2)) is amended by adding at the end the following new
subparagraph:
`(C) INCREASED FLEXIBILITY FOR CERTAIN STATES- In the case of a State
with a medicaid applicable income level that is at or above 185 percent of
the poverty line--
`(i) the limitation under subparagraph (A) shall not apply to
payments and expenditures described in subsection (a)(2)(A) or
(a)(2)(B); and
`(ii) in applying such limitation to expenditures and costs
described in subsection (a)(2)(C) or (a)(2)(D), any reference in
subparagraph (A) to a sum is deemed a reference to the amount of the
State's allotment under section 2104 for the fiscal year
involved.'.
(c) EFFECTIVE DATE- The amendments made by this section shall be effective
as if included in the enactment of section 4911 of the Balanced Budget Act of
1997.
Subtitle B--Prospective Payment System for Federally-qualified Health
Centers and Rural Health Clinics
SEC. 211. ESTABLISHMENT OF PROSPECTIVE PAYMENT SYSTEM FOR
FEDERALLY-QUALIFIED HEALTH CENTERS AND RURAL HEALTH CLINICS.
(a) IN GENERAL- Section 1902(a) (42 U.S.C. 1396a(a)) is amended--
(A) in subparagraph (A), by adding `and' at the end;
(B) in subparagraph (B), by striking `and' at the end; and
(C) by striking subparagraph (C); and
(2) by inserting after paragraph (14) the following new paragraph:
`(15) for payment for services described in clause (B) or (C) of section
1905(a)(2) under the plan in accordance with subsection (aa);'.
(b) NEW PROSPECTIVE PAYMENT SYSTEM- Section 1902 (42 U.S.C. 1396a) is
amended by adding at the end the following:
`(aa) PAYMENT FOR SERVICES PROVIDED BY FEDERALLY-QUALIFIED HEALTH CENTERS
AND RURAL HEALTH CLINICS-
`(1) IN GENERAL- Beginning with fiscal year 2000 and each succeeding
fiscal year, the State plan shall provide for payment for services described
in section 1905(a)(2)(C) furnished by a Federally-qualified health center
and services described in section 1905(a)(2)(B) furnished by a rural health
clinic in accordance with the provisions of this subsection.
`(2) FISCAL YEAR 2000- Subject to paragraph (4), for services furnished
during fiscal year 2000, the State plan shall provide for payment for such
services in an amount (calculated on a per visit basis) that is equal to 100
percent of the costs of the center or clinic of furnishing such services
during fiscal year 1999 which are reasonable and related to the cost of
furnishing such services, or based on such other tests of reasonableness as
the Secretary prescribes in regulations under section 1833(a)(3), or, in the
case of services to which such regulations do not apply, the same
methodology used under section 1833(a)(3), adjusted to take into account any
increase in the scope of such services furnished by the center or clinic
during fiscal year 2000.
`(3) FISCAL YEAR 2001 AND SUCCEEDING FISCAL YEARS- Subject to paragraph
(4), for services furnished during fiscal year 2001 or a succeeding fiscal
year, the State plan shall provide for payment for such services in an
amount (calculated on a per visit basis) that is equal to the amount
calculated for such services under this subsection for the preceding fiscal
year--
`(A) increased by the percentage increase in the MEI (as defined in
section 1842(i)(3)) applicable to primary care services (as defined in
section 1842(i)(4)) for that fiscal year; and
`(B) adjusted to take into account any increase in the scope of such
services furnished by the center or clinic during that fiscal
year.
`(4) ESTABLISHMENT OF INITIAL YEAR PAYMENT AMOUNT FOR NEW CENTERS OR
CLINICS- In any case in which an entity first qualifies as a
Federally-qualified health center or rural health clinic after fiscal year
1999, the State plan shall provide for payment for services described in
section 1905(a)(2)(C) furnished by the center or services described in
section 1905(a)(2)(B) furnished by the clinic in the first fiscal year in
which the center or clinic so qualifies in an amount (calculated on a per
visit basis) that is equal to 100 percent of the costs of furnishing such
services during such fiscal year in accordance with the regulations and
methodology referred to in paragraph (2). For each fiscal year following the
fiscal year in which the entity first qualifies as a Federally-qualified
health center or rural health clinic, the State plan shall provide for the
payment amount to be calculated in accordance with paragraph (3).
`(5) ADMINISTRATION IN THE CASE OF MANAGED CARE- In the case of services
furnished by a Federally-qualified health center or rural health clinic
pursuant to a contract between the center or clinic and a managed care
entity (as defined in section 1932(a)(1)(B)), the State plan shall provide
for payment to the center or clinic (at least quarterly) by the State of a
supplemental payment equal to the amount (if any) by which the amount
determined under paragraphs (2), (3), and (4) of this subsection exceeds the
amount of the payments provided under the contract.
`(6) ALTERNATIVE PAYMENT METHODOLOGIES- Notwithstanding any other
provision of this section, the State plan may provide for payment in any
fiscal year to a Federally-qualified health center for services described in
section 1905(a)(2)(C) or to a rural health clinic for services described in
section 1905(a)(2)(B) in an amount which is determined under an alternative
payment methodology that--
`(A) is agreed to by the State and the center or clinic; and
`(B) results in payment to the center or clinic of an amount which is
at least equal to the amount otherwise required to be paid to the center
or clinic under this section.'.
(c) CONFORMING AMENDMENTS-
(1) Section 4712 of the Balanced Budget Act of 1997 (Public Law 105-33;
111 Stat. 508) is amended by striking subsection (c).
(2) Section 1915(b) (42 U.S.C. 1396n(b)) is amended by striking
`1902(a)(13)(E)' and inserting `1902(a)(15), 1902(aa),'.
(d) EFFECTIVE DATE- The amendments made by this section take effect on
October 1, 1999, and apply to services furnished on or after such date.
END