PROPERTY OF NOV 1 7 REC'D HCFA LIBhARY 105th CONGRESS H. R. 248 1 1st Session To amend title XVIII of the Social Security Act to permit classification of certain hospitals as rural referral centers, to permit reclassification of certain hospitals for disproportionate share payments, and to permit sole community hospitals to rebase Medicare payments based upon fiscal year 1994 and 1995 costs. IN THE HOUSE OF REPRESENTATIVES April 1997 8, Mr. Ney (for himself, Mr. Wicker, Mr. Hostettler, Mr. Norwood, Mr. Dickey, Mr. Rahall, Mr. McHugh, Mr. Stupak, Mr. Roemer, Mr. Wise, Mr. Solomon, Mr. Thompson, Mr. Faleomavaega, Mr. Clyburn, Mr. Spratt, Mr. Barrett of Nebraska, Mr. Inglis of South Carolina, and Mr. ENGLISH of Pennsylvania) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend title XVIII of the Social Security Act to permit classification of certain hospitals as rural referral cen- ters, to permit reclassification of certain hospitals for disproportionate share payments, and to permit sole com- munity hospitals to rebase Medicare payments based upon fiscal year 1994 and 1995 costs. 1 Be it enacted by the Senate and House ofRepresenta- 2 tives ofthe United States ofAmerica in Congress assembled, — SECTION SHORT TITLE. 1 1. 2 This Act may be cited as the "Rural Health Care 3 Protection Act of 1997". 4 SEC. 2. CLASSIFICATION AS RURAL REFERRAL CENTERS. 5 (a) Prohibiting Denial of Request for Reclas- 6 SIFICATION ON BASIS OF COMPARABILITY OF WAGES. 7 (1) In general.—Section 1886(d)(10)(D) of 8 the Social Security Act (42 U.S.C. 9 1395ww(d)(10)(D)) is amended— 10 (A) by redesignating clause (iii) as clause and 1 1 (iv); 12 (B) by inserting after clause (ii) the follow- 13 ing new clause: 14 "(iii) Under the guidelines published by the Secretary 15 under clause (i), in the case of a hospital which has ever 16 been classified by the Secretary as a rural referral center 17 under paragraph (5)(C), the Board may not reject the ap- 18 plication of the hospital under this paragraph on the basis 19 of any comparison between the average hourly wage of the 20 hospital and the average hourly wage of hospitals in the 21 area in which it is located.". — 22 (2) Effective date. Notwithstanding sec- 23 tion 1886(d)(10)(C)(h) of the Social Security Act, a 24 hospital may submit an application to the Medicare 25 Geographic Classification Review Board during the 26 60-day period beginning on the date of the enact- •HR 1248 IH loU^S (05"-K Caress/ I 3 1 ment of this Act requesting a change in its classi- 2 fication for purposes of determining the area wage 3 index applicable to the hospital under section 4 1886(d)(3)(D) of such Act for fiscal year 1998 if the 5 hospital would be eligible for such a change in its 6 classification under the standards described in sec- 7 tion 1886(d)(10)(D) (as amended by paragraph (1)) 8 but for its failure to meet the deadline for applica- 9 tions under section 1886(d)(10)(C)(ii). 10 Reference to budget neutrality pro (3) 11 VISION.—For a requirement that the Secretary of 12 Health and Human Services make a proportional 13 adjustment in the Medicare standardized payment 14 amounts for inpatient hospital services to assure 15 that geographic reclassifications of hospitals result- 16 ing from this subsection do not result in an increase 17 in aggregate payments under section 1886 of the So- 18 cial Security Act, see subsection (d)(8)(D) of such 19 section. 20 (b) Continuing Treatment of Previously Des- — 21 ignated Centers. — 22 (1) In general. Any hospital classified as a 23 rural referral center by the Secretary of Health and 24 Human Services under section 1886(d)(5)(C) of the 25 Social Security Act for fiscal year 1991 shall be clas- •HR 1248 IH — 4 1 sified as such a rural referral center for fiscal year 2 1998 and each subsequent fiscal year. — 3 (2) Budget neutrality. The provisions of 4 section 1886(d)(8)(D) of the Social Security Act 5 shall apply to reclassifications made pursuant to 6 paragraph (1) in the same manner as such provi- 7 sions apply to a reclassification under section 8 1886(d)(10) of such Act. 9 SEC. HOSPITAL GEOGRAPHIC RECLASSIFICATION PER- 3. 10 MITTED FOR PURPOSES OF DISPROPORTION- ATE SHARE PAYMENT ADJUSTMENTS. 1 1 12 (a) In General.—Section 1886(d)(10)(C)(i) of the 13 Social Security Act (42 U.S.C. 1395ww(d)(10)(C)(i)) is 4 amended 1 15 (1) by striking "or" at the end of subclause (I); 16 (2) by striking the period at the end of sub- 17 clause (II) and inserting or"; 18 (3) by inserting after subclause (II) the follow- 19 ing: 20 "(HI) eligibility for and amount of additional 21 payment amounts under paragraph (5)(F)."; and 22 (4) by adding at the end the following: 23 "Any application approved for purposes of subclause (I) 24 for a fiscal year is deemed to be approved for purposes 25 of subclause (III) for that fiscal year.". HR 1248 IH — 1 (b) Effective Date. Notwithstanding section 2 1886(d)(10)(C)(ii) of the Social Security Act, a hospital 3 may submit an application to the Medicare Geographic 4 Classification Review Board during the 60-day period be- 5 ginning on the date of the enactment of this Act request- 6 ing a change in its classification for purposes of determin- 7 ing the disproportionate share hospital payment applicable 8 to the hospital under section 1886(d)(5)(F) of such Act 9 for fiscal year 1998 if the hospital would be eligible for 10 such a change in its classification under the guidelines de- 1 1 scribed in subsection (c) of this section but for its failure 12 to meet the deadline for applications under section 13 1886(d)(10(C)(ii). — 14 (c) Applicable Guidelines. Such Board shall 15 apply the guidelines established for reclassification under 16 subclause (I) of section 1886(d)(10)(C)(i) of such Act to 17 reclassification under subclause (III) of such section until 18 the Secretary of Health and Human Services promulgates 19 separate guidelines for reclassification under such sub- 20 clause (III). 21 (d) Reference to Budget Neutrality Provi- — 22 SION. For a requirement that the Secretary of Health 23 and Human Services make a proportional adjustment in 24 the medicare standardized payment amounts for inpatient 25 hospital services to assure that geographic reclassifications •HR 1248 IH 6 1 of hospitals resulting from this section do not result in 2 an increase in aggregate payments under section 1886 of 3 the Social Security Act, see subsection (d)(8)(D) of such 4 section. 5 SEC. 4. PERMITTING REBASENG OF PAYMENT FOR SOLE 6 COMMUNITY HOSPITALS USING FISCAL 7 YEARS 1994 AND 1995 COSTS. 8 Section 1886(b)(3) of the Social Security Act (42 9 U.S.C. 1395ww(b)(3)) is amended— 10 (1) in subparagraph (C), by inserting "subject 11 to subparagraph (F)," after "subsection 12 (d)(5)(D)(iii))," and ; 13 (2) by adding at the end the following new sub- 14 paragraph: 15 "(F) In applying subparagraph (C) with respect to 16 discharges occurring in fiscal year 1998 and each subse- 17 quent fiscal year, in no case shall the target amount for 18 a hospital for fiscal year 1998 be less than the average of— 19 20 "(i) the allowable operating costs of inpatient 21 hospital services recognized under this title for the 22 hospital's 12-month cost reporting period (if any) 23 beginning during fiscal year 1994 increased (in a 24 compounded manner) by the applicable percentage •HR 1248 IH 7 1 increase under subparagraph (B)(iv) for each of fis- 2 cal years 1995, 1996, 1997, and 1998, and 3 "(ii) the allowable operating costs of inpatient 4 hospital services recognized under this title for the 5 hospital's 12-month cost reporting period (if any) 6 beginning during fiscal year 1995 increased (in a 7 compounded manner) by the applicable percentage 8 increase under subparagraph (B)(iv) for each of fis- 9 cal years 1996, 1997, and 1998.". O •HR 1248 IH CHS LIBRARY ACH5 DD01A41A