H.R. 3939 (103rd): Ethics in Billing Act

103rd Congress, 1993–1994. Text as of Mar 02, 1994 (Introduced).

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HR 3939 IH

103d CONGRESS

2d Session

H. R. 3939

To amend the Public Health Service Act to eliminate the incentives that lead to increased prices and utilization of clinical laboratory diagnostic testing services and other ancillary health services.

IN THE HOUSE OF REPRESENTATIVES

March 2, 1994

Mr. SLATTERY (for himself, Mr. MCMILLAN, and Mr. PENNY) introduced the following bill; which was referred to the Committee on Energy and Commerce


A BILL

To amend the Public Health Service Act to eliminate the incentives that lead to increased prices and utilization of clinical laboratory diagnostic testing services and other ancillary health services.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ‘Ethics in Billing Act’.

SEC. 2. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT.

    (a) IN GENERAL- The Public Health Service Act is amended--

      (1) by redesignating title XXVII (42 U.S.C. 300cc et seq.) as title XXVIII; and

      (2) by inserting after title XXVI the following new title:

‘TITLE XXVII--RESTRICTIONS ON BILLING

‘SEC. 2701. PROHIBITION.

    ‘(a) BILLING OF OTHERS FOR ANCILLARY HEALTH SERVICES- Except as provided in section 2702, it shall be unlawful for any person (including any individual or entity) who furnishes ancillary health services (as defined in section 2705(1)) to present or cause to be presented, a claim, bill, or demand for payment to any person other than the patient receiving such services.

    ‘(b) BILLING OF RECIPIENT OF SERVICES- Except as provided in section 2702, it shall be unlawful for any physician, or the agent of any physician, to present, or cause to be presented, a claim, bill, or demand for payment for ancillary health services to any recipient of such services unless the services covered by the claim, bill, or demand were furnished--

      ‘(1) personally by, or under the supervision of, the referring physician;

      ‘(2) personally by, or under the supervision of, a physician who is a member of the same group practice as the referring physician; or

      ‘(3) personally by individuals who are employed by such physician or group practice and who are personally supervised by the physician or by another physician in the group practice.

    ‘(c) GENERAL EXCEPTION FOR SERVICES UNDER MEDICARE- This section does not apply with respect to any ancillary health services for which payment may be made under title XVIII of the Social Security Act.

‘SEC. 2702. EXCEPTIONS.

    ‘Notwithstanding the provisions of section 2701, a person who furnishes ancillary health services to an individual may present, or cause to be presented, for payment for actual services rendered a claim, bill, or demand to--

      ‘(1) an immediate family member of the recipient of the services or any other person legally responsible for the debts or care of the recipient of the services;

      ‘(2) a third party payor designated by the recipient of the services;

      ‘(3) a health maintenance organization in which the recipient of the services is enrolled;

      ‘(4) a hospital or skilled nursing facility where the recipient of the services was an inpatient or outpatient at the time the services were provided;

      ‘(5) an employer where the recipient of the services is an employee of such employer and the employer is responsible for payment for the services;

      ‘(6) a governmental agency or specified agent, on behalf of the recipient of the services;

      ‘(7) a substance abuse program where the clients of such a program were the recipient of the services;

      ‘(8) a clinic or other health care provider that has been designated (or that is operated by an organization that has been designated) as tax-exempt pursuant to section 501(c)(3) of the Internal Revenue Code of 1986 whose purpose is the promotion of public health, if the services rendered relate to testing for sexually transmitted disease, acquired immune deficiency syndrome, pregnancy, pregnancy termination, or other conditions where the Secretary has determined that compliance with section 2701 could seriously compromise the recipient’s need for confidentiality;

      ‘(9) a person engaged in bona fide research studies;

      ‘(10) the party requesting the ancillary health services where Federal, State, or local law requires that the identity of the recipient be kept confidential;

      ‘(11) another person furnishing the same ancillary health services for which payment is sought (hereafter referred to in this paragraph as the ‘requesting party’) where the person presenting, or causing to be presented, the claim, bill, or demand for payment furnished the services at the request of the requesting party, except that the requesting party may not be a facility owned or operated by the physician requesting the ancillary health service; and

      ‘(12) an entity approved to receive such claims, bills or demands by the Secretary in regulations.

    The persons described in paragraphs (1) through (12) who have received a claim, bill, or demand for payment for such ancillary health services may present, or cause to be presented, such claim, bill, or demand to the responsible party.

‘SEC. 2703. SANCTIONS.

    ‘(a) PAYMENT- No payment may be made for a service that is provided in violation of section 2701.

    ‘(b) COLLECTION OF AMOUNTS-

      ‘(1) LIABILITY ON COLLECTION- If a person collects any amounts that were billed in violation of section 2701(a), such person shall be liable for, and shall refund on a timely basis to the individual whom such amounts were collected, any amounts so collected.

      ‘(2) COLLECTION BY PHYSICIAN- If a physician collects any amounts from a recipient of services, or from another person on behalf of the recipient of services (including a third-party payor) that were billed in violation of section 2701(b), such physician shall be liable for, and shall refund on a timely basis to the recipient or person, any amounts so collected.

    ‘(c) REPEATED CLAIMS- Any person that presents, or causes to be presented, on a repeated basis, a bill or a claim that such person knows, or should have known, is for a service for which payment may not be made under subsection (a), or for which a refund has not been made under subsection (b), shall be subject to a civil money penalty of not more than $5,000 for each such bill or claim. The provisions of section 1128A of the Social Security Act (other than the first sentence of subsection (a) and subsection (b)) shall apply to a civil money penalty assessed under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under such section 1128A(a).

    ‘(d) SUSPENSION OF LABORATORY CERTIFICATION- If the Secretary finds, after reasonable notice and opportunity for a hearing, that a laboratory which holds a certificate pursuant to section 353 has violated section 2701, the Secretary may suspend, revoke or limit such certification in accordance with the procedures established in section 353(k).

    ‘(e) EXCLUSION FROM OTHER PROGRAMS-

      ‘(1) AUTHORITY- The Secretary may exclude from participation in any program under title XVIII of the Social Security Act, any individual or entity that the Secretary determines has violated section 2701 and may direct that such individual and entity be excluded from participation in any State health care program receiving Federal funds.

      ‘(2) APPLICATION OF OTHER LAW- The provisions of section 1128(e) of the Social Security Act shall apply to any exclusion under paragraph (1) in the same manner as such provisions apply to a proceeding under such section 1128.

‘SEC. 2704. REGULATIONS.

    ‘The Secretary shall by regulation impose such other requirements as may be necessary to implement the purposes of this title.

‘SEC. 2705. DEFINITIONS.

    ‘As used in this title:

      ‘(1) ANCILLARY HEALTH SERVICES- The term ‘ancillary health services’ means--

        ‘(A) clinical laboratory services;

        ‘(B) diagnostic x-ray tests and other diagnostic imaging services including CT and magnetic resonance imaging services;

        ‘(C) other diagnostic tests;

        ‘(D) durable medical equipment; and

        ‘(E) physical therapy services.

      ‘(2) GROUP PRACTICES- The term ‘group practice’ means a group of 2 or more physicians legally organized as a partnership, professional corporation, foundation, not-for-profit corporation, faculty practice plan, or similar association--

        ‘(A) in which each physician who is a member of the group provides substantially the full range of services that the physician routinely provides (including medical care, consultation, diagnosis, or treatment) through the joint use of shared office space, facilities, equipment, and personnel;

        ‘(B) for which substantially all of the services of the physicians who are members of the group are provided through the group and are billed in the name of the group and amounts so received are treated as receipts of the group;

        ‘(C) in which the overhead expenses of and the income from the practice are distributed in accordance with methods previously determined by members of the group; and

        ‘(D) which meets such other standards as the Secretary may impose by regulation.

      In the case of a faculty practice plan associated with a hospital with an approved medical residency training program in which physician members may provide a variety of different specialty services and provide professional services both within and outside the group (as well as perform other tasks, such as research), the definition of such term shall be limited with respect to the services provided outside of the faculty practice plan.

      ‘(3) IMMEDIATE FAMILY MEMBER- The term ‘immediate family member’ shall include spouses, natural and adoptive parents, natural and adoptive children, natural and adopted siblings, stepparents, stepchildren and stepsiblings, fathers-in-law, mothers-in-law, brothers-in-law, sisters-in-law, sons-in-law and daughters-in-law, grandparents and grandchildren, and such additional family members as may be specified in regulations adopted by the Secretary.

      ‘(4) PHYSICIAN- The term ‘physician’ means--

        ‘(A) a doctor of medicine or osteopathy legally authorized to practice medicine and perform surgery by the State in which such individual performs such function or action;

        ‘(B) a doctor of dental surgery or of dental medicine who is legally authorized to practice dentistry in the State in which such individual performs such functions;

        ‘(C) a doctor of podiatric medicine;

        ‘(D) a doctor of optometry; or

        ‘(E) a chiropractor.

      ‘(5) THIRD PARTY PAYOR- The term ‘third party payor’ means any health care insurer, including any hospital services corporation, health services corporation, medical expense indemnity corporation, mutual insurance company, or self-insured corporation, that provides coverage for health or health-related items or service.’.

    (b) CONFORMING AMENDMENTS-

      (1) Sections 2701 through 2714 of the Public Health Service Act (42 U.S.C. 300cc through 300cc-15) are redesignated as sections 2801 through 2814, respectively.

      (2)(A) Sections 465(f) and 497 of such Act (42 U.S.C. 286(f) and 289) are amended by striking out ‘2701’ each place that such appears and inserting in lieu thereof ‘2801’.

      (B) Section 305(i) of such Act (42 U.S.C. 242c(i)) is amended by striking out ‘2711’ each place that such appears and inserting in lieu thereof ‘2811’.

SEC. 3. EFFECTIVE DATE.

    (a) IN GENERAL- This Act shall become effective December 31, 1994.

    (b) REGULATIONS- Not later than July 1, 1995, the Secretary of Health and Human Services shall promulgate such regulations as may be appropriate to carry out this Act.