H.R. 6378 (111th): FAST Act

111th Congress, 2009–2010. Text as of Sep 29, 2010 (Introduced).

Status & Summary | PDF | Source: GPO

I

111th CONGRESS

2d Session

H. R. 6378

IN THE HOUSE OF REPRESENTATIVES

September 29, 2010

introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means and the Judiciary, 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 reduce waste, fraud, and abuse under the Medicare, Medicaid, and CHIP programs, and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Fighting Fraud and Abuse to Save Taxpayers' Dollars Act or the FAST Act.

(b)

Table of contents

The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings.

Sec. 3. Tracking excluded providers across State lines.

Sec. 4. Access for private sector and governmental entities.

Sec. 5. Liability of Medicare administrative contractors for claims submitted by excluded providers.

Sec. 6. Limiting the discharge of debts in bankruptcy proceedings in cases where a health care provider or a supplier engages in fraudulent activity.

Sec. 7. Prevention of waste, fraud, and abuse in the Medicaid and CHIP programs.

Sec. 8. Illegal distribution of a Medicare, Medicaid, or CHIP beneficiary identification or billing privileges.

Sec. 9. Pilot program for the use of universal product numbers on claim forms for reimbursement under the Medicare program.

Sec. 10. Prohibition of inclusion of Social Security account numbers on Medicare cards.

Sec. 11. Implementation.

2.

Findings

Congress makes the following findings:

(1)

The Medicare program loses an estimated $60,000,000,000 annually to wasted and fraudulent payments.

(2)

The Medicaid program also suffers from rampant fraud. As the Office of the Inspector General of the Department of Health and Human Services noted in 2009, in an analysis of the only source of nationwide Medicaid claims and beneficiary eligibility information, the Medicaid Statistical Information System, the Federal Government does not have timely, accurate, or comprehensive information for fraud, waste, and abuse detection in the Medicaid program.

(3)

Absent comprehensive estimates, the Medicaid program's improper payment rate may be the most objective measure of taxpayer dollars lost to fraud. The national average improper payment rate ranges between 8.7 percent and 10.5 percent, but many States have much higher improper payment rates.

(4)

The new Federal health reform law substantially expands the Medicaid program, significantly changes the Medicare program, creates new mandates and regulations, and will send hundreds of billions of dollars to insurance companies.

(5)

It is the duty of public officials and public servants in Congress and the Administration to protect the American public’s taxpayer dollars. Congress and the Administration must continue to aggressively combat waste, fraud, and abuse in public health care programs.

(6)

The Inspector General of the Department of Health and Human Services has stated that swift and effective detection of and response to waste, fraud, and abuse remain an essential program integrity strategy. Furthermore, the Inspector General noted that effective use of Medicare and Medicaid data is critical to the success of the Government’s efforts to reduce waste, fraud, and abuse.

(7)

The loss of taxpayer dollars due to waste and fraud under the Medicare and Medicaid programs not only threatens the financial viability of those programs, it erodes the public trust. American taxpayers should not be expected to tolerate rampant waste, fraud, and abuse in publicly funded health care programs.

(8)

Congress supports the commitment of the Office of the Inspector General of the Department of Health and Human Services to enhancing existing data analysis and mining capabilities and employing advanced techniques such as predictive analytics and social network analysis, to counter new and existing fraud schemes.

(9)

Congress supports the use of predictive modeling and other smart technologies that can transform the current pay and chase payment cultures under the Medicare and Medicaid programs and prevent taxpayer dollars from being lost to waste, fraud, and abuse.

3.

Tracking excluded providers across State lines

(a)

Greater Coordination

In order to ensure that providers of services and suppliers that have operated in one State and are excluded from participation in the Medicare program are unable to begin operation and participation in other Federal health care programs in another State, the Secretary shall provide for increased coordination between the following:

(1)

The Administrator of the Centers for Medicare & Medicaid Services.

(2)

Regional offices of the Centers for Medicare & Medicaid Services.

(3)

Medicare administrative contractors, fiscal intermediaries, and carriers.

(4)

State health agencies, State plans under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.), State plans under title XXI of such Act (42 U.S.C. 1397aa et seq.), and entities that contract with such agencies and plans, as directed by the Secretary.

(5)

The Federation of State Medical Boards.

(b)

Improved Information Systems

(1)

In general

The Secretary shall improve information systems to allow greater integration between databases under the Medicare program so that—

(A)

Medicare administrative contractors, fiscal intermediaries, and carriers have immediate access to information identifying providers and suppliers excluded from participation in the Medicare program, the Medicaid program under title XIX of the Social Security Act, the State Children's Health Insurance Program under title XXI of such Act, and other Federal health care programs; and

(B)

such information can be shared on a real-time basis, in accordance with protocols established under subsection (g)(2)—

(i)

across Federal health care programs and agencies, including between the Department of Health and Human Services, the Social Security Administration, the Department of Veterans Affairs, the Department of Defense, the Department of Justice, and the Office of Personnel Management; and

(ii)

with State health agencies, State plans under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.), State child health plans under title XXI of such Act (42 U.S.C. 1397aa et seq.), and entities that contract with such agencies and plans, as directed by the Secretary.

(2)

Sharing of information in addition to HEAT efforts

The information shared under paragraph (1) shall be in addition to, and shall not replace, activities of the Health Care Fraud Prevention and Enforcement Action Team (HEAT) established by the Attorney General and the Department of Health and Human Services.

(3)

Appropriate coordination

In implementing this subsection, the Secretary shall provide for the maximum appropriate coordination with the process established under section 6401(b)(2) of the Patient Protection and Affordable Care Act (Public Law 111–148).

(c)

One PI Database for Medicare, Medicaid, and CHIP

(1)

In general

The Secretary shall—

(A)

continue to upload Medicare claims, provider, and beneficiary data into the Integrated Data Repository under section 1128J(a)(1) of the Social Security Act, as added by section 6402(a) of the Patient Protection and Affordable Care Act until such time as the Secretary determines that the Integrated Data Repository is completed; and

(B)

fully implement the waste, fraud, and abuse detection solution of the Centers for Medicare & Medicaid Services, called the One PI project (in this subsection referred to as the project) by not later than January 1, 2013.

(2)

Access

The Secretary, in consultation with Inspector General of the Department of Health and Human Services, may allow stakeholders who combat, or could assist in combating, waste, fraud, and abuse under Federal health care programs to have access to the One PI system established under the project. Such stakeholders may include the Director of the Federal Bureau of Investigation, the Comptroller General of the United States, Medicare administrative contractors, fiscal intermediaries, and carriers.

(d)

Federal and state agency access to national practitioner data bank

For purposes of enhancing data sharing in order to identify programmatic weaknesses and improving the timeliness of analysis and actions to prevent waste, fraud, and abuse, relevant Federal and State agencies, including the Department of Health and Human Services, the Department of Justice, State departments of health, State Medicaid plans under title XIX of the Social Security Act, State child health plans under title XXI of such Act, and State Medicaid fraud control units (as described in section 1903(q) of the Social Security Act (42 U.S.C. 1396b(q))), shall have real-time access to the National Practitioner Data Bank, as directed by the Secretary. The Secretary may, in consultation with the Inspector General of the Department of Health and Human Services, give such real-time access to State attorneys general and State and local law enforcement agencies.

(e)

Access to claims and payment databases

Section 1128J(a)(2) of the Social Security Act, as added by section 6402(a) of the Patient Protection and Affordable Care Act (Public Law 111–148) is amended—

(1)

by striking databases.—For purposes and inserting “databases.—

(A)

Access for the conduct of law enforcement and oversight activities

For purposes

;

(2)

in subparagraph (A), as added by paragraph (1), by inserting , including the Integrated Data Repository under paragraph (1) before the period at the end; and

(3)

by adding at the end the following new subparagraph:

(B)

Access to reduce waste, fraud, and abuse

For purposes of reducing waste, fraud, and abuse, and to the extent consistent with applicable information, privacy, security, and disclosure laws, including the regulations promulgated under the Health Insurance Portability and Accountability Act of 1996 and section 552a of title 5, United States Code, and subject to any information systems security requirements under such laws or otherwise required by the Secretary, the Secretary, in consultation with the Inspector General of the Department of Health and Human Services, may allow State Medicaid fraud control units and State and local law enforcement officials to have access to claims and payment data of the Department of Health and Human Services and its contractors related to titles XVIII, XIX, and XXI, including the Integrated Data Repository under paragraph (1).

.

(f)

Ensuring data is uploaded to the IDR on a daily basis

Section 1128J(a)(1) of the Social Security Act, as added by section 6402(a) of the Patient Protection and Affordable Care Act (Public Law 111–148) is amended by adding at the end the following new subparagraph:

(C)

Uploading of Medicare claims data on a daily basis

All Medicare claims data shall be uploaded into the Integrated Data Repository on a daily basis.

.

(g)

Real-Time access to data

(1)

In general

The Secretary shall ensure that any data provided to an entity or individual under the provisions of or amendments made by this section is provided to such entity or individual on a real-time basis, in accordance with protocols established by the Secretary under paragraph (2). The Secretary shall consult with the Inspector General of the Department of Health and Human Services prior to implementing this subsection.

(2)

Protocols

(A)

In general

The Secretary shall establish protocols to ensure the secure transfer and storage of any data provided to another entity or individual under the provisions of or amendments made by this section.

(B)

Consideration of HHS OIG recommendations

In establishing protocols under subparagraph (A), the Secretary shall take into account recommendations submitted to the Secretary by the Inspector General of the Department of Health and Human Services with respect to the secure transfer and storage of such data.

(h)

GAO study and report on use of Federation of State Medical Boards To strengthen enrollment integrity processes

(1)

Study

The Comptroller General of the United States shall, in consultation with the Federation of State Medical Boards, conduct a study on whether and, if so, to what degree, such Federation may be useful to the Secretary in further strengthening the integrity of processes for enrolling providers of services and suppliers under Federal health care programs.

(2)

Report

Not later than 1 year after the date of enactment of this Act, the Comptroller General of the United States shall submit to Congress a report containing the results of the study conducted under paragraph (1), together with recommendations for such legislation and administrative action as the Comptroller General determines appropriate.

(i)

Definitions

In this section:

(1)

Administrator

The term Administrator means the Administrator of the Centers for Medicare & Medicaid Services.

(2)

CHIP

The term CHIP means the State Children's Health Insurance Program under title XXI of the Social Security Act (42 U.S.C. 1397aa et seq.).

(3)

Federal health care program

The term Federal health care program has the meaning given such term in section 1128B(f) of the Social Security Act (42 U.S.C. 1320a–7b(f)).

(4)

HHS OIG

The term HHS OIG means the Inspector General of the Department of Health and Human Services.

(5)

Medicare administrative contractors, fiscal intermediaries, and carriers

The term Medicare administrative contractors, fiscal intermediaries, and carriers includes zone program integrity contractors, program safeguard or integrity contractors, recovery audit contractors under section 1893(h) of the Social Security Act (42 U.S.C. 1395ddd(h)), and special investigative units at Medicare contractors (as defined in section 1889(g) of the Social Security Act (42 U.S.C. 1395zz(g))).

(6)

Medicare program

The term Medicare program means the program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.).

(7)

Provider of services

The term provider of services has the meaning given such term in section 1861(u) of the Social Security Act (42 U.S.C. 1395x(u)).

(8)

Secretary

The term Secretary means the Secretary of Health and Human Services.

(9)

State

The term State includes the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, and American Samoa.

(10)

Supplier

The term supplier has the meaning given such term in section 1861(d) of the Social Security Act (42 U.S.C. 1395x(d)).

4.

Access for private sector and governmental entities

(a)

In General

Title XI of the Social Security Act (42 U.S.C. 1301 et seq.), as amended by section 6402(a) of the Patient Protection and Affordable Care Act (Public Law 111–148), is amended by inserting after section 1128J the following new section:

1128K.

Expanded access to the national practitioner data bank

(a)

Expanded access

(1)

In general

The information in the National Practitioner Data Bank established pursuant to the Health Care Quality Improvement Act of 1986 (42 U.S.C. 11101 et seq.) may be made available on a real-time basis, in accordance with protocols established by the Secretary under subsection (b), to—

(A)

Federal and State government agencies and health plans, commercial health plans, and any health care provider, supplier, or practitioner entering an employment or contractual relationship with an individual or entity who has been subject to a final adverse action in the past 10 years, where the contract involves the furnishing of items or services reimbursed by one or more Federal health care programs (regardless of whether the individual or entity is paid by the programs directly, or whether the items or services are reimbursed directly or indirectly through the claims of a direct provider); and

(B)

utilization and quality control peer review organizations and accreditation entities as defined by the Secretary, including but not limited to organizations described in part B of this title and in section 1154(a)(4)(C).

(2)

No effect on access under other applicable law; appropriate coordination

Nothing in this section shall affect the availability of information in the National Practitioner Data Bank under other applicable law, including the availability of such information to entities or individuals under part B of the Health Care Quality Improvement Act of 1986 (42 U.S.C. 11131 et seq.). In implementing this section, the Secretary shall provide for the maximum appropriate coordination with such part.

(b)

Protocols

The Secretary shall establish protocols to ensure the secure transfer and storage of data made available under this section. In establishing such protocols the Secretary shall take into account recommendations submitted to the Secretary by the Inspector General of the Department of Health and Human Services and the National Association of Insurance Commissioners with respect to the secure transfer and storage of such data, the establishment or approval of a fee structure under subsection (c), and the establishment of user access protocols.

(c)

Fees for disclosure

(1)

In general

(A)

Fees

Subject to paragraph (2), the Secretary may establish or approve reasonable fees for the disclosure of information under this section, including with respect to requests by Federal agencies or other entities, such as fiscal intermediaries and carriers, acting under contract on behalf of such agencies.

(B)

Establishment or approval of fee amounts

In establishing or approving the amount of such fees, the Secretary shall ensure that the total amount of the fees to be collected is equal to the total costs of processing the requests for disclosure and of providing such information. Such fees shall be available to the Secretary to cover such costs.

(C)

For-profit entities

The Secretary may allow for-profit entities to receive data under this section for a fee that is comparable to the fee charged to a Federal agency or other entity under subparagraph (A) with respect to a similar request.

(2)

Free access to certain data

(A)

In general

Not later than 1 year after the date of enactment of the Fighting Fraud and Abuse to Save Taxpayers' Dollars Act, for purposes of identifying additional strategies and tools to combat waste, fraud, and abuse, the Secretary—

(i)

shall establish protocols to ensure the secure transmission of data under this section; and

(ii)

may ensure nonprofit academic, policy, and research institutions have access to data from the National Practitioner Data Bank.

(B)

Access free of charge

Data shall be provided under subparagraph (A)(ii) free of charge to academic, policy, and research institutions.

(C)

Requirement

Any academic, policy, or research institution that is provided data under subparagraph (A)(ii) shall, as a condition of receiving such data, be required to share with the Secretary any findings using such data to combat waste, fraud, and abuse (in a form and manner of the academic, policy, or research institution's choosing).

(d)

Establishment of appeals process

(1)

In general

The Secretary shall establish a transparent and responsive appeals process under which a provider of services or supplier may have their name removed from the National Practitioner Data Bank. Under such process, appeals shall be conducted in a timely manner (not more than 90 days after the earlier of the date of the listing in the National Practitioner Data Bank or the issuance of any penalty involved) in order to minimize the time that providers of services or suppliers who successfully appeal are excluded from participation under the programs under titles XVIII and XIX.

(2)

Consultation

The Secretary shall consult with major colleges of medical practice in the United States, commercial health plans, the Inspector General of the Department of Health and Human Services, the National Association of Insurance Commissioners, and the Federation of State Medical Boards in establishing the appeals process under paragraph (1).

(e)

Definitions

In this section:

(1)

Commercial health plan

The term commercial health plan means health insurance coverage (as defined in section 2791 of the Public Health Service Act and including group health plans).

(2)

Final adverse action

The term final adverse action means one or more of the following actions:

(A)

A Medicare-imposed revocation of any Medicare billing privileges.

(B)

Suspension or revocation of a license to provide health care by any State licensing authority.

(C)

A conviction of a Federal or State felony offense within the last 10 years preceding enrollment, revalidation, or re-enrollment.

(D)

An exclusion or debarment from participation in a Federal or State health care program.

.

(b)

Criminal Penalty for Misuse of Information disclosed

Section 1128B(b) of the Social Security Act (42 U.S.C. 1320a–7b(b)) is amended by adding at the end the following:

(4)

Whoever knowingly uses information disclosed from the National Practitioner Data Bank under section 1128K for a purpose other than those authorized under that section shall be imprisoned for not more than 3 years or fined under title 18, United States Code, or both.

.

(c)

Effective Date

The amendments made by this section shall take effect on the date of enactment of this Act.

5.

Liability of Medicare administrative contractors for claims submitted by excluded providers

(a)

Reimbursement to the Secretary for Amounts Paid to Excluded Providers

Section 1874A(b) of the Social Security Act (42 U.S.C. 1395kk(b)) is amended by adding at the end the following new paragraph:

(6)

Reimbursements to Secretary for amounts paid to excluded providers

(A)

Limitation

(i)

In general

Except as provided in clause (ii), the Secretary shall not enter into a contract with a Medicare administrative contractor under this section unless the contractor agrees to reimburse the Secretary for any amounts paid by the contractor for with respect to any item or service (other than an emergency item or service, not including items or services furnished in an emergency room of a hospital) which is furnished—

(I)

by an individual or entity during the period when such individual or entity is excluded pursuant to section 1128, 1128A, 1156 or 1842(j)(2) from participation in the program under this title; or

(II)

at the medical direction or on the prescription of a physician during the period when he is excluded pursuant to section 1128, 1128A, 1156, or 1842(j)(2) from participation in the program under this title and when the person furnishing such item or service knew or had reason to know of the exclusion (after a reasonable time period after reasonable notice has been furnished to the person).

(ii)

Exception

Where a Medicare administrative contractor pays a claim for payment for items or services furnished by an individual or entity excluded from participation in the programs under this title, pursuant to section 1128, 1128A, 1156, or l866, and such Medicare administrative contractor did not know or have reason to know that such individual or entity was so excluded, then, to the extent permitted by this title, and notwithstanding such exclusion, the contractor shall not be required to reimburse the Secretary under clause (i) for any amounts paid with respect to such items or services. In each such case the Secretary shall notify the contractor of the exclusion of the individual or entity furnishing the items or services. A Medicare administrative contractor shall not make payment for items or services furnished by an excluded individual or entity to a beneficiary after a reasonable time (as determined by the Secretary in regulations) after the Secretary has notified the contractor of the exclusion of that individual or entity.

(B)

Requirement to review claims

A Medicare administrative contractor shall review claims submitted to the contractor for payment for services under this title in order to ensure that such services were not furnished by an individual or entity during any period for which the individual or entity is excluded from such participation (as described in subparagraph (A)).

.

(b)

Report on effectiveness and development of scorecard and measurable performance metrics for medicare contractors

(1)

Report

(A)

In general

Not later than 12 months after the date of enactment of this Act, the Secretary of Health and Human Services shall submit to Congress a report on the overall effectiveness and potential of Medicare contractors.

(B)

Contents of report

The report submitted under subparagraph (A) shall include the Secretary's recommendations for the development of measurable performance metrics and a scorecard for Medicare contractors (or, in the case of Medicare administrative contractors, updated and revised measurable performance metrics and a revised scorecard), together with recommendations for such legislation and administrative action as the Secretary determines appropriate.

(2)

Consultation

The Secretary shall consult with Medicare contractors, the Inspector General of the Department of Health and Human Services, private sector waste, fraud, and abuse experts, and entities with experience combating and preventing waste, fraud, and abuse, including through the review of Medicare claims, in preparing the report submitted under paragraph (1).

(3)

Medicare contractors defined

In this subsection, the term Medicare contractor means any of the following:

(A)

A Medicare administrative contractor under section 1874A of the Social Security Act.

(B)

A Medicare Program Safeguard Contractor.

(C)

A Zone Program Integrity Contractor.

(D)

A Medicare Drug Integrity Contractor.

(c)

Effective Date

(1)

In general

The amendments made by subsection (a) shall apply to claims for reimbursement submitted on or after the date of enactment of this Act.

(2)

Contract modification

The Secretary of Health and Human Services shall take such steps as may be necessary to modify contracts entered into, renewed, or extended prior to the date of enactment of this Act to conform such contracts to the provisions of and amendments made by this section.

6.

Limiting the discharge of debts in bankruptcy proceedings in cases where a health care provider or a supplier engages in fraudulent activity

(a)

In General

(1)

Civil monetary penalties

Section 1128A(a) of the Social Security Act (42 U.S.C. 1320a–7a(a)) is amended by adding at the end the following: Notwithstanding any other provision of law, amounts made payable under this section are not dischargeable under section 727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any other provision of such title..

(2)

Recovery of overpayment to providers of services under part A

Section 1815(d) of the Social Security Act (42 U.S.C. 1395g(d)) is amended—

(A)

by inserting (1) after (d); and

(B)

by adding at the end the following:

(2)

Notwithstanding any other provision of law, amounts due to the Secretary under this section are not dischargeable under section 727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any other provision of such title if the overpayment was the result of fraudulent activity, as may be defined by the Secretary.

.

(3)

Recovery of overpayment of benefits under part B

Section 1833(j) of the Social Security Act (42 U.S.C. 1395l(j)) is amended—

(A)

by inserting (1) after (j); and

(B)

by adding at the end the following:

(2)

Notwithstanding any other provision of law, amounts due to the Secretary under this section are not dischargeable under section 727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any other provision of such title if the overpayment was the result of fraudulent activity, as may be defined by the Secretary.

.

(4)

Collection of past-due obligations arising from breach of scholarship and loan contract

Section 1892(a) of the Social Security Act (42 U.S.C. 1395ccc(a)) is amended by adding at the end the following:

(5)

Notwithstanding any other provision of law, amounts due to the Secretary under this section are not dischargeable under section 727, 944, 1141, 1228, or 1328 of title 11, United States Code, or any other provision of such title.

.

(b)

Effective Date

The amendments made by subsection (a) shall apply to bankruptcy petitions filed after the date of enactment of this Act.

7.

Prevention of waste, fraud, and abuse in the Medicaid and CHIP programs

(a)

Detection of fraudulent identification numbers within the Medicaid and CHIP programs

(1)

Medicaid

Section 1903(i) of the Social Security Act (42 U.S.C. 1396b(i)), as amended by section 2001(a)(2)(B) of the Patient Protection and Affordable Care Act (Public Law 111–148), is amended—

(A)

in paragraph (25), by striking or at the end;

(B)

in paragraph (26), by striking the period and inserting ; or; and

(C)

by adding at the end the following new paragraph:

(27)

with respect to amounts expended for an item or service for which medical assistance is provided under the State plan or under a waiver of such plan unless the claim for payment for such item or service contains—

(A)

a valid beneficiary identification number that, for purposes of the individual who received such item or service, has been determined by the State agency to correspond to an individual who is eligible to receive benefits under the State plan or waiver; and

(B)

a valid National Provider Identifier that, for purposes of the provider that furnished such item or service, has been determined by the State agency to correspond to a participating provider that is eligible to receive payment for furnishing such item or service under the State plan or waiver.

.

(2)

CHIP

Section 2107(e)(1)(I) of the Social Security Act (42 U.S.C. 1397gg(e)(1)(I)) is amended by striking and (17) and inserting (17), and (27).

(b)

Screening requirements for managed care entities

(1)

In general

Section 1902 of the Social Security Act (42 U.S.C. 1396a) is amended—

(A)

by redesignating the second subsection (ii), as added by section 6401(b)(1)(B) of the Patient Protection and Affordable Care Act, as subsection (kk) of such section; and

(B)

in subsection (kk), as so redesignated—

(i)

by redesignating paragraph (8) as paragraph (9); and

(ii)

by inserting after paragraph (7) the following new paragraph:

(8)

Managed care entities

The State establishes procedures to ensure that any managed care entity (as defined in section 1932(a)(1)(B)) under contract with the State complies with all applicable requirements under this subsection.

.

(2)

Medicaid managed care organizations

Section 1903(m)(2)(A) of the Social Security Act (42 U.S.C. 1396b(m)(2)(A)) is amended—

(A)

in clause (xii), by striking and at the end;

(B)

in clause (xiii), by striking the period and inserting ; and; and

(C)

by adding at the end the following new clause:

(xiv)

such contract requires that the entity comply with any applicable screening, oversight, and reporting requirements under section 1902(kk).

.

(3)

Managed care entities

Section 1932(d) of the Social Security Act (42 U.S.C. 1396u–2(d)) is amended by adding at the end the following new paragraph:

(5)

Compliance with screening, oversight, and reporting requirements

A managed care entity shall comply with any applicable screening, oversight, and reporting requirements under section 1902(kk).

.

(c)

Required database checks

Clause (i) of section 1866(j)(2)(B) of the Social Security Act (42 U.S.C. 1395cc(j)(2)(B)) is amended to read as follows:

(i)

shall include—

(I)

a licensure check, which may include such checks across States; and

(II)

for purposes of the Medicaid program under title XIX—

(aa)

database checks (including such checks across States), which shall include—

(AA)

the Medicaid Statistical Information System (as described in section 1903(r)(1)(F)); and

(BB)

any relevant medical databases that are maintained by the State agencies, as determined by the Secretary in consultation with the directors of the State agencies; and

(bb)

coordination of excluded provider lists between the Secretary and the State agency, including exchanges of data regarding excluding providers between Federal and State databases; and

.

(d)

Technical corrections

Section 1902 of the Social Security Act (42 U.S.C. 1396a), as amended by subsection (b)(1), is further amended—

(1)

in subsection (a)—

(A)

in paragraph (23), by striking subsection (ii)(4) and inserting subsection (kk)(4); and

(B)

in paragraph (77), by striking subsection (ii) and inserting subsection (kk); and

(2)

in subsection (kk), by striking section 1886 each place it appears and inserting section 1866.

8.

Illegal distribution of a Medicare, Medicaid, or CHIP beneficiary identification or billing privileges

Section 1128B(b) of the Social Security Act (42 U.S.C. 1320a–7b(b)), as amended by section 4(b), is amended by adding at the end the following:

(5)

Whoever knowingly, intentionally, and with the intent to defraud purchases, sells or distributes, or arranges for the purchase, sale, or distribution of a Medicare, Medicaid, or CHIP beneficiary identification number or billing privileges under title XVIII, title XIX, or title XXI shall be imprisoned for not more than 10 years or fined not more than $500,000 ($1,000,000 in the case of a corporation), or both.

.

9.

Pilot program for the use of universal product numbers on claim forms for reimbursement under the Medicare program

(a)

Establishment

(1)

In general

Not later than January 1, 2013, the Secretary shall establish a pilot program under which claims for reimbursement under the Medicare program for UPN covered items contain the universal product number of the UPN covered item.

(2)

Duration

The pilot program under this section shall be conducted for a 2-year period.

(3)

Consideration of GAO recommendations

The Secretary shall take into account the recommendations of the Comptroller General of the United States in establishing the pilot program under this section.

(b)

Development and implementation of procedures

(1)

Information included in UPN

The Secretary, in consultation with manufacturers and entities with appropriate expertise, shall determine the relevant descriptive information appropriate for inclusion in a universal product number for a UPN covered item under the pilot program.

(2)

Review of procedure

The Secretary, in consultation with interested parties (which shall, at a minimum, include the Inspector General of the Department of Health and Human Services and private sector and health industry experts), shall use information obtained under the pilot program through the use of universal product numbers on claims for reimbursement under the Medicare program to periodically review the UPN covered items billed under the Health Care Financing Administration Common Procedure Coding System and adjust such coding system to ensure that functionally equivalent UPN covered items are billed and reimbursed under the same codes.

(c)

GAO reports to congress on effectiveness of implementation of pilot program

(1)

Initial report

Not later than 6 months after the implementation of the pilot program under this section, the Comptroller General of the United States shall submit to Congress a report on the effectiveness of such implementation.

(2)

Final report

Not later than 18 months after the completion of the pilot program under this section, the Comptroller General of the United States shall submit to Congress a report on the effectiveness of the pilot program, together with recommendations regarding the use of universal product numbers and the use of data obtained from the use of such numbers, and recommendations for such legislation and administrative action as the Comptroller General determines appropriate.

(d)

Use of available funding

The Secretary shall use amounts available in the Centers for Medicare & Medicaid Services Program Management Account or in the Health Care Fraud and Abuse Control Account under section 1817(k) of the Social Security Act (42 U.S.C. 1395i(k)) to carry out the pilot program under this section.

(e)

Definitions

In this section:

(1)

Medicare program

The term Medicare program means the program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.).

(2)

Secretary

The term Secretary means the Secretary of Health and Human Services.

(3)

Universal product number

The term universal product number means a number that is—

(A)

affixed by the manufacturer to each individual UPN covered item that uniquely identifies the item at each packaging level; and

(B)

based on commercially acceptable identification standards such as, but not limited to, standards established by the Uniform Code Council—International Article Numbering System or the Health Industry Business Communication Council.

(4)

UPN Covered item

(A)

In general

Except as provided in subparagraph (B), the term UPN covered item means—

(i)

a covered item as that term is defined in section 1834(a)(13) of the Social Security Act (42 U.S.C. 1395m(a)(13));

(ii)

an item described in paragraph (8) or (9) of section 1861(s) of such Act (42 U.S.C. 1395x);

(iii)

an item described in paragraph (5) of such section 1861(s); and

(iv)

any other item for which payment is made under this title that the Secretary determines to be appropriate.

(B)

Exclusion

The term UPN covered item does not include a customized item for which payment is made under this title.

10.

Prohibition of inclusion of Social Security account numbers on Medicare cards

(a)

In general

Section 205(c)(2)(C) of the Social Security Act (42 U.S.C. 405(c)(2)(C)), as amended by section 1414(a)(2) of the Patient Protection and Affordable Care Act (Public Law 111–148), is amended by adding at the end the following new clause:

(xi)

The Secretary of Health and Human Services, in consultation with the Commissioner of Social Security, shall establish cost-effective procedures to ensure that a Social Security account number (or any derivative thereof) is not displayed, coded, or embedded on the Medicare card issued to an individual who is entitled to benefits under part A of title XVIII or enrolled under part B of title XVIII and that any other identifier displayed on such card is easily identifiable as not being the Social Security account number (or a derivative thereof).

.

(b)

Effective date

(1)

In general

The amendment made by subsection (a) shall apply with respect to Medicare cards issued on and after an effective date specified by the Secretary of Health and Human Services, but in no case shall such effective date be later than the date that is 24 months after the date adequate funding is provided pursuant to subsection (d)(2).

(2)

Reissuance

Subject to subsection (d)(2), in the case of individuals who have been issued such cards before such date, the Secretary of Health and Human Services—

(A)

shall provide for the reissuance for such individuals of such a card that complies with such amendment not later than 3 years after the effective date specified under paragraph (1); and

(B)

may permit such individuals to apply for the reissuance of such a card that complies with such amendment before the date of reissuance otherwise provided under subparagraph (A) in such exceptional circumstances as the Secretary may specify.

(c)

Outreach program

Subject to subsection (d)(2), the Secretary of Health and Human Services, in consultation with the Commissioner of Social Security, shall conduct an outreach program to Medicare beneficiaries and providers about the new Medicare card provided under this section.

(d)

Report to Congress and limitations on effective date

(1)

Report

Not later than 90 days after the date of the enactment of this Act, the Secretary of Health and Human Services, acting through the Administrator of the Centers for Medicare & Medicaid Services and in consultation with the Commissioner of Social Security, shall submit to Congress a report that includes detailed options regarding the implementation of this section, including line-item estimates of and justifications for the costs associated with such options and estimates of timeframes for each stage of implementation. In recommending such options, the Secretary shall take into consideration, among other factors, cost-effectiveness and beneficiary outreach and education.

(2)

Limitation; modification of deadlines

With respect to the amendment made by subsection (a), and the requirements of subsections (b) and (c)—

(A)

such amendment and requirements shall not apply until adequate funding is transferred pursuant to section 11(b) to implement the provisions of this section, as determined by Congress; and

(B)

any deadlines otherwise established under this section for such amendment and requirements are contingent upon the receipt of adequate funding (as determined in subparagraph (A)) for such implementation.

The previous sentence shall not affect the timely submission of the report required under paragraph (1).
11.

Implementation

(a)

Empowering the HHS OIG and GAO

Except as otherwise provided, to the extent practicable, the Secretary of Health and Human Services (in this section referred to as the Secretary) shall—

(1)

carry out the provisions of and amendments made by this Act in consultation with the Inspector General of the Department of Health and Human Services; and

(2)

take into consideration the findings and recommendations of the Comptroller General of the United States in carrying out such provisions and amendments.

(b)

Funding

The Secretary shall provide for the transfer, from the Health Care Fraud and Abuse Control Account under section 1817(k) of the Social Security Act (42 U.S.C. 1395i(k)), to the Centers for Medicare & Medicaid Services Program Management Account, of such sums, provided such sums are fully offset, as the Secretary determines are for necessary administrative expenses associated with carrying out the provisions of and amendments made by this Act (other than section 9). Amounts transferred under the preceding sentence shall remain available until expended.

(c)

Savings

Any reduction in outlays under the Medicare program under title XVIII of the Social Security Act under the provisions of, and amendments made by, this Act may only be utilized to offset outlays under part A of such title.