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H.R. 4209 (113th): SGR Repeal and Medicare Provider Payment Modernization Act of 2014


The text of the bill below is as of Mar 12, 2014 (Introduced). The bill was not enacted into law.


I

113th CONGRESS

2d Session

H. R. 4209

IN THE HOUSE OF REPRESENTATIVES

March 12, 2014

introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, the Judiciary, and the Budget, 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 repeal the Medicare sustainable growth rate and improve Medicare payments for physicians and other professionals, and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the SGR Repeal and Medicare Provider Payment Modernization Act of 2014 .

(b)

Table of contents

The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Repealing the sustainable growth rate (SGR) and improving Medicare payment for physicians’ services.

Sec. 3. Priorities and funding for measure development.

Sec. 4. Encouraging care management for individuals with chronic care needs.

Sec. 5. Ensuring accurate valuation of services under the physician fee schedule.

Sec. 6. Promoting evidence-based care.

Sec. 7. Empowering beneficiary choices through access to information on physicians’ services.

Sec. 8. Expanding availability of Medicare data.

Sec. 9. Reducing administrative burden and other provisions.

Sec. 10. Savings from overseas contingency and related activities.

2.

Repealing the sustainable growth rate (SGR) and improving Medicare payment for physicians’ services

(a)

Stabilizing fee updates

(1)

Repeal of SGR payment methodology

Section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ) is amended—

(A)

in subsection (d)—

(i)

in paragraph (1)(A), by inserting or a subsequent paragraph after paragraph (4); and

(ii)

in paragraph (4)—

(I)

in the heading, by inserting and ending with 2013 after years beginning with 2001 ; and

(II)

in subparagraph (A), by inserting and ending with 2013 after a year beginning with 2001; and

(B)

in subsection (f)—

(i)

in paragraph (1)(B), by inserting through 2013 after of each succeeding year; and

(ii)

in paragraph (2), in the matter preceding subparagraph (A), by inserting and ending with 2013 after beginning with 2000.

(2)

Update of rates for April through December of 2014, 2015, and subsequent years

Subsection (d) of section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ) is amended by striking paragraph (15) and inserting the following new paragraphs:

(15)

Update for 2014 through 2018

The update to the single conversion factor established in paragraph (1)(C) for 2014 and each subsequent year through 2018 shall be 0.5 percent.

(16)

Update for 2019 through 2023

The update to the single conversion factor established in paragraph (1)(C) for 2019 and each subsequent year through 2023 shall be zero percent.

(17)

Update for 2024 and subsequent years

The update to the single conversion factor established in paragraph (1)(C) for 2024 and each subsequent year shall be—

(A)

for items and services furnished by a qualifying APM participant (as defined in section 1833(z)(2)) for such year, 1.0 percent; and

(B)

for other items and services, 0.5 percent.

.

(3)

MedPAC reports

(A)

Initial report

Not later than July 1, 2016, the Medicare Payment Advisory Commission shall submit to Congress a report on the relationship between—

(i)

physician and other health professional utilization and expenditures (and the rate of increase of such utilization and expenditures) of items and services for which payment is made under section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ); and

(ii)

total utilization and expenditures (and the rate of increase of such utilization and expenditures) under parts A, B, and D of title XVIII of such Act .

Such report shall include a methodology to describe such relationship and the impact of changes in such physician and other health professional practice and service ordering patterns on total utilization and expenditures under parts A, B, and D of such title.
(B)

Final report

Not later than July 1, 2020, the Medicare Payment Advisory Commission shall submit to Congress a report on the relationship described in subparagraph (A), including the results determined from applying the methodology included in the report submitted under such subparagraph.

(C)

Report on update to physicians’ services under Medicare

Not later than July 1, 2018, the Medicare Payment Advisory Commission shall submit to Congress a report on—

(i)

the payment update for professional services applied under the Medicare program under title XVIII of the Social Security Act for the period of years 2014 through 2018;

(ii)

the effect of such update on the efficiency, economy, and quality of care provided under such program;

(iii)

the effect of such update on ensuring a sufficient number of providers to maintain access to care by Medicare beneficiaries; and

(iv)

recommendations for any future payment updates for professional services under such program to ensure adequate access to care is maintained for Medicare beneficiaries.

(b)

Consolidation of certain current law performance programs with new merit-Based Incentive Payment System

(1)

EHR meaningful use incentive program

(A)

Sunsetting separate meaningful use payment adjustments

Section 1848(a)(7)(A) of the Social Security Act ( 42 U.S.C. 1395w–4(a)(7)(A) ) is amended—

(i)

in clause (i), by striking or any subsequent payment year and inserting or 2017;

(ii)

in clause (ii)—

(I)

in the matter preceding subclause (I), by striking Subject to clause (iii), for and inserting For;

(II)

in subclause (I), by adding at the end and;

(III)

in subclause (II), by striking ; and and inserting a period; and

(IV)

by striking subclause (III); and

(iii)

by striking clause (iii).

(B)

Continuation of meaningful use determinations for MIPS

Section 1848(o)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(o)(2) ) is amended—

(i)

in subparagraph (A), in the matter preceding clause (i)—

(I)

by striking For purposes of paragraph (1) , an and inserting An; and

(II)

by inserting , or pursuant to subparagraph (D) for purposes of subsection (q), for a performance period under such subsection for a year after under such subsection for a year; and

(ii)

by adding at the end the following new subparagraph:

(D)

Continued application for purposes of MIPS

With respect to 2018 and each subsequent payment year, the Secretary shall, for purposes of subsection (q) and in accordance with paragraph (1)(F) of such subsection, determine whether an eligible professional who is a MIPS eligible professional (as defined in subsection (q)(1)(C)) for such year is a meaningful EHR user under this paragraph for the performance period under subsection (q) for such year.

.

(2)

Quality reporting

(A)

Sunsetting separate quality reporting incentives

Section 1848(a)(8)(A) of the Social Security Act ( 42 U.S.C. 1395w–4(a)(8)(A) ) is amended—

(i)

in clause (i), by striking or any subsequent year and inserting or 2017; and

(ii)

in clause (ii)(II), by striking and each subsequent year.

(B)

Continuation of quality measures and processes for MIPS

Section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ) is amended—

(i)

in subsection (k), by adding at the end the following new paragraph:

(9)

Continued application for purposes of MIPS and for certain professionals volunteering to report

The Secretary shall, in accordance with subsection (q)(1)(F), carry out the provisions of this subsection—

(A)

for purposes of subsection (q); and

(B)

for eligible professionals who are not MIPS eligible professionals (as defined in subsection (q)(1)(C)) for the year involved.

; and

(ii)

in subsection (m)—

(I)

by redesignating paragraph (7) added by section 10327(a) of Public Law 111–148 as paragraph (8); and

(II)

by adding at the end the following new paragraph:

(9)

Continued application for purposes of MIPS and for certain professionals volunteering to report

The Secretary shall, in accordance with subsection (q)(1)(F), carry out the processes under this subsection—

(A)

for purposes of subsection (q); and

(B)

for eligible professionals who are not MIPS eligible professionals (as defined in subsection (q)(1)(C)) for the year involved.

.

(3)

Value-based payments

(A)

Sunsetting separate value-based payments

Clause (iii) of section 1848(p)(4)(B) of the Social Security Act ( 42 U.S.C. 1395w–4(p)(4)(B) ) is amended to read as follows:

(iii)

Application

The Secretary shall apply the payment modifier established under this subsection for items and services furnished on or after January 1, 2015, but before January 1, 2018, with respect to specific physicians and groups of physicians the Secretary determines appropriate. Such payment modifier shall not be applied for items and services furnished on or after January 1, 2018.

.

(B)

Continuation of value-based payment modifier measures for MIPS

Section 1848(p) of the Social Security Act ( 42 U.S.C. 1395w–4(p) ) is amended—

(i)

in paragraph (2), by adding at the end the following new subparagraph:

(C)

Continued application for purposes of MIPS

The Secretary shall, in accordance with subsection (q)(1)(F), carry out subparagraph (B) for purposes of subsection (q).

; and

(ii)

in paragraph (3), by adding at the end the following: With respect to 2018 and each subsequent year, the Secretary shall, in accordance with subsection (q)(1)(F), carry out this paragraph for purposes of subsection (q)..

(c)

Merit-Based Incentive Payment System

(1)

In general

Section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ) is amended by adding at the end the following new subsection:

(q)

Merit-Based Incentive Payment System

(1)

Establishment

(A)

In general

Subject to the succeeding provisions of this subsection, the Secretary shall establish an eligible professional Merit-based Incentive Payment System (in this subsection referred to as the MIPS) under which the Secretary shall—

(i)

develop a methodology for assessing the total performance of each MIPS eligible professional according to performance standards under paragraph (3) for a performance period (as established under paragraph (4)) for a year;

(ii)

using such methodology, provide for a composite performance score in accordance with paragraph (5) for each such professional for each performance period; and

(iii)

use such composite performance score of the MIPS eligible professional for a performance period for a year to determine and apply a MIPS adjustment factor (and, as applicable, an additional MIPS adjustment factor) under paragraph (6) to the professional for the year.

(B)

Program implementation

The MIPS shall apply to payments for items and services furnished on or after January 1, 2018.

(C)

MIPS eligible professional defined

(i)

In general

For purposes of this subsection, subject to clauses (ii) and (iv), the term MIPS eligible professional means—

(I)

for the first and second years for which the MIPS applies to payments (and for the performance period for such first and second year), a physician (as defined in section 1861(r)), a physician assistant, nurse practitioner, and clinical nurse specialist (as such terms are defined in section 1861(aa)(5)), and a certified registered nurse anesthetist (as defined in section 1861(bb)(2)) and a group that includes such professionals; and

(II)

for the third year for which the MIPS applies to payments (and for the performance period for such third year) and for each succeeding year (and for the performance period for each such year), the professionals described in subclause (I) and such other eligible professionals (as defined in subsection (k)(3)(B)) as specified by the Secretary and a group that includes such professionals.

(ii)

Exclusions

For purposes of clause (i), the term MIPS eligible professional does not include, with respect to a year, an eligible professional (as defined in subsection (k)(3)(B)) who—

(I)

is a qualifying APM participant (as defined in section 1833(z)(2));

(II)

subject to clause (vii), is a partial qualifying APM participant (as defined in clause (iii)) for the most recent period for which data are available and who, for the performance period with respect to such year, does not report on applicable measures and activities described in paragraph (2)(B) that are required to be reported by such a professional under the MIPS; or

(III)

for the performance period with respect to such year, does not exceed the low-volume threshold measurement selected under clause (iv).

(iii)

Partial qualifying APM participant

For purposes of this subparagraph, the term partial qualifying APM participant means, with respect to a year, an eligible professional for whom the Secretary determines the minimum payment percentage (or percentages), as applicable, described in paragraph (2) of section 1833(z) for such year have not been satisfied, but who would be considered a qualifying APM participant (as defined in such paragraph) for such year if—

(I)

with respect to 2018 and 2019, the reference in subparagraph (A) of such paragraph to 25 percent was instead a reference to 20 percent;

(II)

with respect to 2020 and 2021—

(aa)

the reference in subparagraph (B)(i) of such paragraph to 50 percent was instead a reference to 40 percent; and

(bb)

the references in subparagraph (B)(ii) of such paragraph to 50 percent and 25 percent of such paragraph were instead references to 40 percent and 20 percent, respectively; and

(III)

with respect to 2022 and subsequent years—

(aa)

the reference in subparagraph (C)(i) of such paragraph to 75 percent was instead a reference to 50 percent; and

(bb)

the references in subparagraph (C)(ii) of such paragraph to 75 percent and 25 percent of such paragraph were instead references to 50 percent and 20 percent, respectively.

(iv)

Selection of low-volume threshold measurement

The Secretary shall select a low-volume threshold to apply for purposes of clause (ii)(III), which may include one or more or a combination of the following:

(I)

The minimum number (as determined by the Secretary) of individuals enrolled under this part who are treated by the eligible professional for the performance period involved.

(II)

The minimum number (as determined by the Secretary) of items and services furnished to individuals enrolled under this part by such professional for such performance period.

(III)

The minimum amount (as determined by the Secretary) of allowed charges billed by such professional under this part for such performance period.

(v)

Treatment of new Medicare enrolled eligible professionals

In the case of a professional who first becomes a Medicare enrolled eligible professional during the performance period for a year (and had not previously submitted claims under this title such as a person, an entity, or a part of a physician group or under a different billing number or tax identifier), such professional shall not be treated under this subsection as a MIPS eligible professional until the subsequent year and performance period for such subsequent year.

(vi)

Clarification

In the case of items and services furnished during a year by an individual who is not a MIPS eligible professional (including pursuant to clauses (ii) and (v)) with respect to a year, in no case shall a MIPS adjustment factor (or additional MIPS adjustment factor) under paragraph (6) apply to such individual for such year.

(vii)

Partial qualifying APM participant clarifications

(I)

Treatment as MIPS eligible professional

In the case of an eligible professional who is a partial qualifying APM participant, with respect to a year, and who for the performance period for such year reports on applicable measures and activities described in paragraph (2)(B) that are required to be reported by such a professional under the MIPS, such eligible professional is considered to be a MIPS eligible professional with respect to such year.

(II)

Not eligible for qualifying APM participant payments

In no case shall an eligible professional who is a partial qualifying APM participant, with respect to a year, be considered a qualifying APM participant (as defined in paragraph (2) of section 1833(z)) for such year or be eligible for the additional payment under paragraph (1) of such section for such year.

(D)

Application to group practices

(i)

In general

Under the MIPS:

(I)

Quality performance category

The Secretary shall establish and apply a process that includes features of the provisions of subsection (m)(3)(C) for MIPS eligible professionals in a group practice with respect to assessing performance of such group with respect to the performance category described in clause (i) of paragraph (2)(A).

(II)

Other performance categories

The Secretary may establish and apply a process that includes features of the provisions of subsection (m)(3)(C) for MIPS eligible professionals in a group practice with respect to assessing the performance of such group with respect to the performance categories described in clauses (ii) through (iv) of such paragraph.

(ii)

Ensuring comprehensiveness of group practice assessment

The process established under clause (i) shall to the extent practicable reflect the range of items and services furnished by the MIPS eligible professionals in the group practice involved.

(iii)

Clarification

MIPS eligible professionals electing to be a virtual group under paragraph (5)(I) shall not be considered MIPS eligible professionals in a group practice for purposes of applying this subparagraph.

(E)

Use of registries

Under the MIPS, the Secretary shall encourage the use of qualified clinical data registries pursuant to subsection (m)(3)(E) in carrying out this subsection.

(F)

Application of certain provisions

In applying a provision of subsection (k), (m), (o), or (p) for purposes of this subsection, the Secretary shall—

(i)

adjust the application of such provision to ensure the provision is consistent with the provisions of this subsection; and

(ii)

not apply such provision to the extent that the provision is duplicative with a provision of this subsection.

(G)

Accounting for risk factors

(i)

Risk factors

Taking into account the relevant studies conducted and recommendations made in reports under section 2(f)(1) of the SGR Repeal and Medicare Provider Payment Modernization Act of 2014, the Secretary, on an ongoing basis, shall estimate how an individual’s health status and other risk factors affect quality and resource use outcome measures and, as feasible, shall incorporate information from quality and resource use outcome measurement (including care episode and patient condition groups) into the MIPS.

(ii)

Accounting for other factors in payment adjustments

Taking into account the studies conducted and recommendations made in reports under section 2(f)(1) of the SGR Repeal and Medicare Provider Payment Modernization Act of 2014 and other information as appropriate, the Secretary shall account for identified factors with an effect on quality and resource use outcome measures when determining payment adjustments, composite performance scores, scores for performance categories, or scores for measures or activities under the MIPS.

(2)

Measures and activities under performance categories

(A)

Performance categories

Under the MIPS, the Secretary shall use the following performance categories (each of which is referred to in this subsection as a performance category) in determining the composite performance score under paragraph (5):

(i)

Quality.

(ii)

Resource use.

(iii)

Clinical practice improvement activities.

(iv)

Meaningful use of certified EHR technology.

(B)

Measures and activities specified for each category

For purposes of paragraph (3)(A) and subject to subparagraph (C), measures and activities specified for a performance period (as established under paragraph (4)) for a year are as follows:

(i)

Quality

For the performance category described in subparagraph (A)(i), the quality measures included in the final measures list published under subparagraph (D)(i) for such year and the list of quality measures described in subparagraph (D)(vi) used by qualified clinical data registries under subsection (m)(3)(E).

(ii)

Resource use

For the performance category described in subparagraph (A)(ii), the measurement of resource use for such period under subsection (p)(3), using the methodology under subsection (r) as appropriate, and, as feasible and applicable, accounting for the cost of drugs under part D.

(iii)

Clinical practice improvement activities

For the performance category described in subparagraph (A)(iii), clinical practice improvement activities (as defined in subparagraph (C)(v)(III)) under subcategories specified by the Secretary for such period, which shall include at least the following:

(I)

The subcategory of expanded practice access, which shall include activities such as same day appointments for urgent needs and after hours access to clinician advice.

(II)

The subcategory of population management, which shall include activities such as monitoring health conditions of individuals to provide timely health care interventions or participation in a qualified clinical data registry.

(III)

The subcategory of care coordination, which shall include activities such as timely communication of test results, timely exchange of clinical information to patients and other providers, and use of remote monitoring or telehealth.

(IV)

The subcategory of beneficiary engagement, which shall include activities such as the establishment of care plans for individuals with complex care needs, beneficiary self-management assessment and training, and using shared decision-making mechanisms.

(V)

The subcategory of patient safety and practice assessment, such as through use of clinical or surgical checklists and practice assessments related to maintaining certification.

(VI)

The subcategory of participation in an alternative payment model (as defined in section 1833(z)(3)(C)).

In establishing activities under this clause, the Secretary shall give consideration to the circumstances of small practices (consisting of 15 or fewer professionals) and practices located in rural areas and in health professional shortage areas (as designated under section 332(a)(1)(A) of the Public Health Service Act).
(iv)

Meaningful EHR use

For the performance category described in subparagraph (A)(iv), the requirements established for such period under subsection (o)(2) for determining whether an eligible professional is a meaningful EHR user.

(C)

Additional provisions

(i)

Emphasizing outcome measures under the quality performance category

In applying subparagraph (B)(i), the Secretary shall, as feasible, emphasize the application of outcome measures.

(ii)

Application of additional system measures

The Secretary may use measures used for a payment system other than for physicians, such as measures for inpatient hospitals, for purposes of the performance categories described in clauses (i) and (ii) of subparagraph (A). For purposes of the previous sentence, the Secretary may not use measures for hospital outpatient departments, except in the case of emergency physicians.

(iii)

Global and population-based measures

The Secretary may use global measures, such as global outcome measures, and population-based measures for purposes of the performance category described in subparagraph (A)(i).

(iv)

Application of measures and activities to non-patient-facing professionals

In carrying out this paragraph, with respect to measures and activities specified in subparagraph (B) for performance categories described in subparagraph (A), the Secretary

(I)

shall give consideration to the circumstances of professional types (or subcategories of those types determined by practice characteristics) who typically furnish services that do not involve face-to-face interaction with a patient; and

(II)

may, to the extent feasible and appropriate, take into account such circumstances and apply under this subsection with respect to MIPS eligible professionals of such professional types or subcategories, alternative measures or activities that fulfill the goals of the applicable performance category.

In carrying out the previous sentence, the Secretary shall consult with professionals of such professional types or subcategories.
(v)

Clinical practice improvement activities

(I)

Request for information

In initially applying subparagraph (B)(iii), the Secretary shall use a request for information to solicit recommendations from stakeholders to identify activities described in such subparagraph and specifying criteria for such activities.

(II)

Contract authority for clinical practice improvement activities performance category

In applying subparagraph (B)(iii), the Secretary may contract with entities to assist the Secretary in—

(aa)

identifying activities described in subparagraph (B)(iii);

(bb)

specifying criteria for such activities; and

(cc)

determining whether a MIPS eligible professional meets such criteria.

(III)

Clinical practice improvement activities defined

For purposes of this subsection, the term clinical practice improvement activity means an activity that relevant eligible professional organizations and other relevant stakeholders identify as improving clinical practice or care delivery and that the Secretary determines, when effectively executed, is likely to result in improved outcomes.

(D)

Annual list of quality measures available for MIPS assessment

(i)

In general

Under the MIPS, the Secretary, through notice and comment rulemaking and subject to the succeeding clauses of this subparagraph, shall, with respect to the performance period for a year, establish an annual final list of quality measures from which MIPS eligible professionals may choose for purposes of assessment under this subsection for such performance period. Pursuant to the previous sentence, the Secretary shall—

(I)

not later than November 1 of the year prior to the first day of the first performance period under the MIPS, establish and publish in the Federal Register a final list of quality measures; and

(II)

not later than November 1 of the year prior to the first day of each subsequent performance period, update the final list of quality measures from the previous year (and publish such updated final list in the Federal Register), by—

(aa)

removing from such list, as appropriate, quality measures, which may include the removal of measures that are no longer meaningful (such as measures that are topped out);

(bb)

adding to such list, as appropriate, new quality measures; and

(cc)

determining whether or not quality measures on such list that have undergone substantive changes should be included in the updated list.

(ii)

Call for quality measures

(I)

In general

Eligible professional organizations and other relevant stakeholders shall be requested to identify and submit quality measures to be considered for selection under this subparagraph in the annual list of quality measures published under clause (i) and to identify and submit updates to the measures on such list. For purposes of the previous sentence, measures may be submitted regardless of whether such measures were previously published in a proposed rule or endorsed by an entity with a contract under section 1890(a).

(II)

Eligible professional organization defined

In this subparagraph, the term eligible professional organization means a professional organization as defined by nationally recognized multispecialty boards of certification or equivalent certification boards.

(iii)

Requirements

In selecting quality measures for inclusion in the annual final list under clause (i), the Secretary shall—

(I)

provide that, to the extent practicable, all quality domains (as defined in subsection (s)(1)(B)) are addressed by such measures; and

(II)

ensure that such selection is consistent with the process for selection of measures under subsections (k), (m), and (p)(2).

(iv)

Peer review

Before including a new measure or a measure described in clause (i)(II)(cc) in the final list of measures published under clause (i) for a year, the Secretary shall submit for publication in applicable specialty-appropriate peer-reviewed journals such measure and the method for developing and selecting such measure, including clinical and other data supporting such measure.

(v)

Measures for inclusion

The final list of quality measures published under clause (i) shall include, as applicable, measures under subsections (k), (m), and (p)(2), including quality measures from among—

(I)

measures endorsed by a consensus-based entity;

(II)

measures developed under subsection (s); and

(III)

measures submitted under clause (ii)(I).

Any measure selected for inclusion in such list that is not endorsed by a consensus-based entity shall have a focus that is evidence-based.
(vi)

Exception for qualified clinical data registry measures

Measures used by a qualified clinical data registry under subsection (m)(3)(E) shall not be subject to the requirements under clauses (i), (iv), and (v). The Secretary shall publish the list of measures used by such qualified clinical data registries on the Internet website of the Centers for Medicare Medicaid Services.

(vii)

Exception for existing quality measures

Any quality measure specified by the Secretary under subsection (k) or (m), including under subsection (m)(3)(E), and any measure of quality of care established under subsection (p)(2) for the reporting period under the respective subsection beginning before the first performance period under the MIPS—

(I)

shall not be subject to the requirements under clause (i) (except under items (aa) and (cc) of subclause (II) of such clause) or to the requirement under clause (iv); and

(II)

shall be included in the final list of quality measures published under clause (i) unless removed under clause (i)(II)(aa).

(viii)

Consultation with relevant eligible professional organizations and other relevant stakeholders

Relevant eligible professional organizations and other relevant stakeholders, including State and national medical societies, shall be consulted in carrying out this subparagraph.

(ix)

Optional application

The process under section 1890A is not required to apply to the selection of measures under this subparagraph.

(3)

Performance standards

(A)

Establishment

Under the MIPS, the Secretary shall establish performance standards with respect to measures and activities specified under paragraph (2)(B) for a performance period (as established under paragraph (4)) for a year.

(B)

Considerations in establishing standards

In establishing such performance standards with respect to measures and activities specified under paragraph (2)(B), the Secretary shall consider the following:

(i)

Historical performance standards.

(ii)

Improvement.

(iii)

The opportunity for continued improvement.

(4)

Performance period

The Secretary shall establish a performance period (or periods) for a year (beginning with the year described in paragraph (1)(B)). Such performance period (or periods) shall begin and end prior to the beginning of such year and be as close as possible to such year. In this subsection, such performance period (or periods) for a year shall be referred to as the performance period for the year.

(5)

Composite performance score

(A)

In general

Subject to the succeeding provisions of this paragraph and taking into account, as available and applicable, paragraph (1)(G), the Secretary shall develop a methodology for assessing the total performance of each MIPS eligible professional according to performance standards under paragraph (3) with respect to applicable measures and activities specified in paragraph (2)(B) with respect to each performance category applicable to such professional for a performance period (as established under paragraph (4)) for a year. Using such methodology, the Secretary shall provide for a composite assessment (using a scoring scale of 0 to 100) for each such professional for the performance period for such year. In this subsection such a composite assessment for such a professional with respect to a performance period shall be referred to as the composite performance score for such professional for such performance period.

(B)

Incentive to report; encouraging use of certified EHR technology for reporting quality measures

(i)

Incentive to report

Under the methodology established under subparagraph (A), the Secretary shall provide that in the case of a MIPS eligible professional who fails to report on an applicable measure or activity that is required to be reported by the professional, the professional shall be treated as achieving the lowest potential score applicable to such measure or activity.

(ii)

Encouraging use of certified EHR technology and qualified clinical data registries for reporting quality measures

Under the methodology established under subparagraph (A), the Secretary shall—

(I)

encourage MIPS eligible professionals to report on applicable measures with respect to the performance category described in paragraph (2)(A)(i) through the use of certified EHR technology and qualified clinical data registries; and

(II)

with respect to a performance period, with respect to a year, for which a MIPS eligible professional reports such measures through the use of such EHR technology, treat such professional as satisfying the clinical quality measures reporting requirement described in subsection (o)(2)(A)(iii) for such year.

(C)

Clinical practice improvement activities performance score

(i)

Rule for accreditation

A MIPS eligible professional who is in a practice that is certified as a patient-centered medical home or comparable specialty practice pursuant to subsection (b)(8)(B)(i) with respect to a performance period shall be given the highest potential score for the performance category described in paragraph (2)(A)(iii) for such period.

(ii)

APM participation

Participation by a MIPS eligible professional in an alternative payment model (as defined in section 1833(z)(3)(C)) with respect to a performance period shall earn such eligible professional a minimum score of one-half of the highest potential score for the performance category described in paragraph (2)(A)(iii) for such performance period.

(iii)

Subcategories

A MIPS eligible professional shall not be required to perform activities in each subcategory under paragraph (2)(B)(iii) or participate in an alternative payment model in order to achieve the highest potential score for the performance category described in paragraph (2)(A)(iii).

(D)

Achievement and improvement

(i)

Taking into account improvement

Beginning with the second year to which the MIPS applies, in addition to the achievement of a MIPS eligible professional, if data sufficient to measure improvement is available, the methodology developed under subparagraph (A)—

(I)

in the case of the performance score for the performance category described in clauses (i) and (ii) of paragraph (2)(A), shall take into account the improvement of the professional; and

(II)

in the case of performance scores for other performance categories, may take into account the improvement of the professional.

(ii)

Assigning higher weight for achievement

Beginning with the fourth year to which the MIPS applies, under the methodology developed under subparagraph (A), the Secretary may assign a higher scoring weight under subparagraph (F) with respect to the achievement of a MIPS eligible professional than with respect to any improvement of such professional applied under clause (i) with respect to a measure, activity, or category described in paragraph (2).

(E)

Weights for the performance categories

(i)

In general

Under the methodology developed under subparagraph (A), subject to subparagraph (F)(i) and clauses (ii) and (iii), the composite performance score shall be determined as follows:

(I)

Quality

(aa)

In general

Subject to item (bb), thirty percent of such score shall be based on performance with respect to the category described in clause (i) of paragraph (2)(A). In applying the previous sentence, the Secretary shall, as feasible, encourage the application of outcome measures within such category.

(bb)

First 2 years

For the first and second years for which the MIPS applies to payments, the percentage applicable under item (aa) shall be increased in a manner such that the total percentage points of the increase under this item for the respective year equals the total number of percentage points by which the percentage applied under subclause (II)(bb) for the respective year is less than 30 percent.

(II)

Resource use

(aa)

In general

Subject to item (bb), thirty percent of such score shall be based on performance with respect to the category described in clause (ii) of paragraph (2)(A).

(bb)

First 2 years

For the first year for which the MIPS applies to payments, not more than 10 percent of such score shall be based on performance with respect to the category described in clause (ii) of paragraph (2)(A). For the second year for which the MIPS applies to payments, not more than 15 percent of such score shall be based on performance with respect to the category described in clause (ii) of paragraph (2)(A).

(III)

Clinical practice improvement activities

Fifteen percent of such score shall be based on performance with respect to the category described in clause (iii) of paragraph (2)(A).

(IV)

Meaningful use of certified EHR technology

Twenty-five percent of such score shall be based on performance with respect to the category described in clause (iv) of paragraph (2)(A).

(ii)

Authority to adjust percentages in case of high EHR meaningful use adoption

In any year in which the Secretary estimates that the proportion of eligible professionals (as defined in subsection (o)(5)) who are meaningful EHR users (as determined under subsection (o)(2)) is 75 percent or greater, the Secretary may reduce the percent applicable under clause (i)(IV), but not below 15 percent. If the Secretary makes such reduction for a year, subject to subclauses (I)(bb) and (II)(bb) of clause (i), the percentages applicable under one or more of subclauses (I), (II), and (III) of clause (i) for such year shall be increased in a manner such that the total percentage points of the increase under this clause for such year equals the total number of percentage points reduced under the preceding sentence for such year.

(F)

Certain flexibility for weighting performance categories, measures, and activities

Under the methodology under subparagraph (A), if there are not sufficient measures and clinical practice improvement activities applicable and available to each type of eligible professional involved, the Secretary shall assign different scoring weights (including a weight of 0)—

(i)

which may vary from the scoring weights specified in subparagraph (E), for each performance category based on the extent to which the category is applicable to the type of eligible professional involved; and

(ii)

for each measure and activity specified under paragraph (2)(B) with respect to each such category based on the extent to which the measure or activity is applicable and available to the type of eligible professional involved.

(G)

Resource use

Analysis of the performance category described in paragraph (2)(A)(ii) shall include results from the methodology described in subsection (r)(5), as appropriate.

(H)

Inclusion of quality measure data from other payers

In applying subsections (k), (m), and (p) with respect to measures described in paragraph (2)(B)(i), analysis of the performance category described in paragraph (2)(A)(i) may include data submitted by MIPS eligible professionals with respect to items and services furnished to individuals who are not individuals entitled to benefits under part A or enrolled under part B.

(I)

Use of voluntary virtual groups for certain assessment purposes

(i)

In general

In the case of MIPS eligible professionals electing to be a virtual group under clause (ii) with respect to a performance period for a year, for purposes of applying the methodology under subparagraph (A)—

(I)

the assessment of performance provided under such methodology with respect to the performance categories described in clauses (i) and (ii) of paragraph (2)(A) that is to be applied to each such professional in such group for such performance period shall be with respect to the combined performance of all such professionals in such group for such period; and

(II)

the composite score provided under this paragraph for such performance period with respect to each such performance category for each such MIPS eligible professional in such virtual group shall be based on the assessment of the combined performance under subclause (I) for the performance category and performance period.

(ii)

Election of practices to be a virtual group

The Secretary shall, in accordance with clause (iii), establish and have in place a process to allow an individual MIPS eligible professional or a group practice consisting of not more than 10 MIPS eligible professionals to elect, with respect to a performance period for a year, for such individual MIPS eligible professional or all such MIPS eligible professionals in such group practice, respectively, to be a virtual group under this subparagraph with at least one other such individual MIPS eligible professional or group practice making such an election. Such a virtual group may be based on geographic areas or on provider specialties defined by nationally recognized multispecialty boards of certification or equivalent certification boards and such other eligible professional groupings in order to capture classifications of providers across eligible professional organizations and other practice areas or categories.

(iii)

Requirements

The process under clause (ii)—

(I)

shall provide that an election under such clause, with respect to a performance period, shall be made before or during the beginning of such performance period and may not be changed during such performance period;

(II)

shall provide that a practice described in such clause, and each MIPS eligible professional in such practice, may elect to be in no more than one virtual group for a performance period; and

(III)

may provide that a virtual group may be combined at the tax identification number level.

(6)

MIPS payments

(A)

MIPS adjustment factor

Taking into account paragraph (1)(G), the Secretary shall specify a MIPS adjustment factor for each MIPS eligible professional for a year. Such MIPS adjustment factor for a MIPS eligible professional for a year shall be in the form of a percent and shall be determined—

(i)

by comparing the composite performance score of the eligible professional for such year to the performance threshold established under subparagraph (D)(i) for such year;

(ii)

in a manner such that the adjustment factors specified under this subparagraph for a year result in differential payments under this paragraph reflecting that—

(I)

MIPS eligible professionals with composite performance scores for such year at or above such performance threshold for such year receive zero or positive incentive payment adjustment factors for such year in accordance with clause (iii), with such professionals having higher composite performance scores receiving higher adjustment factors; and

(II)

MIPS eligible professionals with composite performance scores for such year below such performance threshold for such year receive negative payment adjustment factors for such year in accordance with clause (iv), with such professionals having lower composite performance scores receiving lower adjustment factors;

(iii)

in a manner such that MIPS eligible professionals with composite scores described in clause (ii)(I) for such year, subject to clauses (i) and (ii) of subparagraph (F), receive a zero or positive adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a score at the performance threshold and an adjustment factor of the applicable percent specified in subparagraph (B) is assigned for a score of 100; and

(iv)

in a manner such that—

(I)

subject to subclause (II), MIPS eligible professionals with composite performance scores described in clause (ii)(II) for such year receive a negative payment adjustment factor on a linear sliding scale such that an adjustment factor of 0 percent is assigned for a score at the performance threshold and an adjustment factor of the negative of the applicable percent specified in subparagraph (B) is assigned for a score of 0; and

(II)

MIPS eligible professionals with composite performance scores that are equal to or greater than 0, but not greater than 1/4 of the performance threshold specified under subparagraph (D)(i) for such year, receive a negative payment adjustment factor that is equal to the negative of the applicable percent specified in subparagraph (B) for such year.

(B)

Applicable percent defined

For purposes of this paragraph, the term applicable percent means—

(i)

for 2018, 4 percent;

(ii)

for 2019, 5 percent;

(iii)

for 2020, 7 percent; and

(iv)

for 2021 and subsequent years, 9 percent.

(C)

Additional MIPS adjustment factors for exceptional performance

(i)

In general

In the case of a MIPS eligible professional with a composite performance score for a year at or above the additional performance threshold under subparagraph (D)(ii) for such year, in addition to the MIPS adjustment factor under subparagraph (A) for the eligible professional for such year, subject to the availability of funds under clause (ii), the Secretary shall specify an additional positive MIPS adjustment factor for such professional and year. Such additional MIPS adjustment factors shall be determined by the Secretary in a manner such that professionals having higher composite performance scores above the additional performance threshold receive higher additional MIPS adjustment factors.

(ii)

Additional funding pool

For 2018 and each subsequent year through 2023, there is appropriated from the Federal Supplementary Medical Insurance Trust Fund $500,000,000 for MIPS payments under this paragraph resulting from the application of the additional MIPS adjustment factors under clause (i).

(D)

Establishment of performance thresholds

(i)

Performance threshold

For each year of the MIPS, the Secretary shall compute a performance threshold with respect to which the composite performance score of MIPS eligible professionals shall be compared for purposes of determining adjustment factors under subparagraph (A) that are positive, negative, and zero. Such performance threshold for a year shall be the mean or median (as selected by the Secretary) of the composite performance scores for all MIPS eligible professionals with respect to a prior period specified by the Secretary. The Secretary may reassess the selection under the previous sentence every 3 years.

(ii)

Additional performance threshold for exceptional performance

In addition to the performance threshold under clause (i), for each year of the MIPS, the Secretary shall compute an additional performance threshold for purposes of determining the additional MIPS adjustment factors under subparagraph (C)(i). For each such year, the Secretary shall apply either of the following methods for computing such additional performance threshold for such a year:

(I)

The threshold shall be the score that is equal to the 25th percentile of the range of possible composite performance scores above the performance threshold with respect to the prior period described in clause (i).

(II)

The threshold shall be the score that is equal to the 25th percentile of the actual composite performance scores for MIPS eligible professionals with composite performance scores at or above the performance threshold with respect to the prior period described in clause (i).

(iii)

Special rule for initial 2 years

With respect to each of the first two years to which the MIPS applies, the Secretary shall, prior to the performance period for such years, establish a performance threshold for purposes of determining MIPS adjustment factors under subparagraph (A) and a threshold for purposes of determining additional MIPS adjustment factors under subparagraph (C)(i). Each such performance threshold shall—

(I)

be based on a period prior to such performance periods; and

(II)

take into account—

(aa)

data available with respect to performance on measures and activities that may be used under the performance categories under subparagraph (2)(B); and

(bb)

other factors determined appropriate by the Secretary.

(E)

Application of MIPS adjustment factors

In the case of items and services furnished by a MIPS eligible professional during a year (beginning with 2018), the amount otherwise paid under this part with respect to such items and services and MIPS eligible professional for such year, shall be multiplied by—

(i)

1, plus

(ii)

the sum of—

(I)

the MIPS adjustment factor determined under subparagraph (A) divided by 100, and

(II)

as applicable, the additional MIPS adjustment factor determined under subparagraph (C)(i) divided by 100.

(F)

Aggregate application of MIPS adjustment factors

(i)

Application of scaling factor

(I)

In general

With respect to positive MIPS adjustment factors under subparagraph (A)(ii)(I) for eligible professionals whose composite performance score is above the performance threshold under subparagraph (D)(i) for such year, subject to subclause (II), the Secretary shall increase or decrease such adjustment factors by a scaling factor in order to ensure that the budget neutrality requirement of clause (ii) is met.

(II)

Scaling factor limit

In no case may be the scaling factor applied under this clause exceed 3.0.

(ii)

Budget neutrality requirement

(I)

In general

Subject to clause (iii), the Secretary shall ensure that the estimated amount described in subclause (II) for a year is equal to the estimated amount described in subclause (III) for such year.

(II)

Aggregate increases

The amount described in this subclause is the estimated increase in the aggregate allowed charges resulting from the application of positive MIPS adjustment factors under subparagraph (A) (after application of the scaling factor described in clause (i)) to MIPS eligible professionals whose composite performance score for a year is above the performance threshold under subparagraph (D)(i) for such year.

(III)

Aggregate decreases

The amount described in this subclause is the estimated decrease in the aggregate allowed charges resulting from the application of negative MIPS adjustment factors under subparagraph (A) to MIPS eligible professionals whose composite performance score for a year is below the performance threshold under subparagraph (D)(i) for such year.

(iii)

Exceptions

(I)

In the case that all MIPS eligible professionals receive composite performance scores for a year that are below the performance threshold under subparagraph (D)(i) for such year, the negative MIPS adjustment factors under subparagraph (A) shall apply with respect to such MIPS eligible professionals and the budget neutrality requirement of clause (ii) shall not apply for such year.

(II)

In the case that, with respect to a year, the application of clause (i) results in a scaling factor equal to the maximum scaling factor specified in clause (i)(II), such scaling factor shall apply and the budget neutrality requirement of clause (ii) shall not apply for such year.

(iv)

Additional incentive payment adjustments

In specifying the MIPS additional adjustment factors under subparagraph (C)(i) for each applicable MIPS eligible professional for a year, the Secretary shall ensure that the estimated increase in payments under this part resulting from the application of such additional adjustment factors for MIPS eligible professionals in a year shall be equal (as estimated by the Secretary) to the additional funding pool amount for such year under subparagraph (C)(ii).

(7)

Announcement of result of adjustments

Under the MIPS, the Secretary shall, not later than 30 days prior to January 1 of the year involved, make available to MIPS eligible professionals the MIPS adjustment factor (and, as applicable, the additional MIPS adjustment factor) under paragraph (6) applicable to the eligible professional for items and services furnished by the professional for such year. The Secretary may include such information in the confidential feedback under paragraph (12).

(8)

No effect in subsequent years

The MIPS adjustment factors and additional MIPS adjustment factors under paragraph (6) shall apply only with respect to the year involved, and the Secretary shall not take into account such adjustment factors in making payments to a MIPS eligible professional under this part in a subsequent year.

(9)

Public reporting

(A)

In general

The Secretary shall, in an easily understandable format, make available on the Physician Compare Internet website of the Centers for Medicare Medicaid Services the following:

(i)

Information regarding the performance of MIPS eligible professionals under the MIPS, which—

(I)

shall include the composite score for each such MIPS eligible professional and the performance of each such MIPS eligible professional with respect to each performance category; and

(II)

may include the performance of each such MIPS eligible professional with respect to each measure or activity specified in paragraph (2)(B).

(ii)

The names of eligible professionals in eligible alternative payment models (as defined in section 1833(z)(3)(D)) and, to the extent feasible, the names of such eligible alternative payment models and performance of such models.

(B)

Disclosure

The information made available under this paragraph shall indicate, where appropriate, that publicized information may not be representative of the eligible professional’s entire patient population, the variety of services furnished by the eligible professional, or the health conditions of individuals treated.

(C)

Opportunity to review and submit corrections

The Secretary shall provide for an opportunity for a professional described in subparagraph (A) to review, and submit corrections for, the information to be made public with respect to the professional under such subparagraph prior to such information being made public.

(D)

Aggregate information

The Secretary shall periodically post on the Physician Compare Internet website aggregate information on the MIPS, including the range of composite scores for all MIPS eligible professionals and the range of the performance of all MIPS eligible professionals with respect to each performance category.

(10)

Consultation

The Secretary shall consult with stakeholders in carrying out the MIPS, including for the identification of measures and activities under paragraph (2)(B) and the methodologies developed under paragraphs (5)(A) and (6) and regarding the use of qualified clinical data registries. Such consultation shall include the use of a request for information or other mechanisms determined appropriate.

(11)

Technical assistance to small practices and practices in health professional shortage areas

(A)

In general

The Secretary shall enter into contracts or agreements with appropriate entities (such as quality improvement organizations, regional extension centers (as described in section 3012(c) of the Public Health Service Act), or regional health collaboratives) to offer guidance and assistance to MIPS eligible professionals in practices of 15 or fewer professionals (with priority given to such practices located in rural areas, health professional shortage areas (as designated under in section 332(a)(1)(A) of such Act), and medically underserved areas, and practices with low composite scores) with respect to—

(i)

the performance categories described in clauses (i) through (iv) of paragraph (2)(A); or

(ii)

how to transition to the implementation of and participation in an alternative payment model as described in section 1833(z)(3)(C).

(B)

Funding for implementation

(i)

In general

For purposes of implementing subparagraph (A), the Secretary shall provide for the transfer from the Federal Supplementary Medical Insurance Trust Fund established under section 1841 to the Centers for Medicare Medicaid Services Program Management Account of $40,000,000 for each of fiscal years 2015 through 2019. Amounts transferred under this subparagraph for a fiscal year shall be available until expended.

(ii)

Technical assistance

Of the amounts transferred pursuant to clause (i) for each of fiscal years 2015 through 2019, not less than $10,000,000 shall be made available for each such year for technical assistance to small practices in health professional shortage areas (as so designated) and medically underserved areas.

(12)

Feedback and information to improve performance

(A)

Performance feedback

(i)

In general

Beginning July 1, 2016, the Secretary

(I)

shall make available timely (such as quarterly) confidential feedback to MIPS eligible professionals on the performance of such professionals with respect to the performance categories under clauses (i) and (ii) of paragraph (2)(A); and

(II)

may make available confidential feedback to each such professional on the performance of such professional with respect to the performance categories under clauses (iii) and (iv) of such paragraph.

(ii)

Mechanisms

The Secretary may use one or more mechanisms to make feedback available under clause (i), which may include use of a web-based portal or other mechanisms determined appropriate by the Secretary. With respect to the performance category described in paragraph (2)(A)(i), feedback under this subparagraph shall, to the extent an eligible professional chooses to participate in a data registry for purposes of this subsection (including registries under subsections (k) and (m)), be provided based on performance on quality measures reported through the use of such registries. With respect to any other performance category described in paragraph (2)(A), the Secretary shall encourage provision of feedback through qualified clinical data registries as described in subsection (m)(3)(E).

(iii)

Use of data

For purposes of clause (i), the Secretary may use data, with respect to a MIPS eligible professional, from periods prior to the current performance period and may use rolling periods in order to make illustrative calculations about the performance of such professional.

(iv)

Disclosure exemption

Feedback made available under this subparagraph shall be exempt from disclosure under section 552 of title 5, United States Code.

(v)

Receipt of information

The Secretary may use the mechanisms established under clause (ii) to receive information from professionals, such as information with respect to this subsection.

(B)

Additional information

(i)

In general

Beginning July 1, 2017, the Secretary shall make available to each MIPS eligible professional information, with respect to individuals who are patients of such MIPS eligible professional, about items and services for which payment is made under this title that are furnished to such individuals by other suppliers and providers of services, which may include information described in clause (ii). Such information may be made available under the previous sentence to such MIPS eligible professionals by mechanisms determined appropriate by the Secretary, which may include use of a web-based portal. Such information may be made available in accordance with the same or similar terms as data are made available to accountable care organizations participating in the shared savings program under section 1899, including a beneficiary opt-out.

(ii)

Type of information

For purposes of clause (i), the information described in this clause, is the following:

(I)

With respect to selected items and services (as determined appropriate by the Secretary) for which payment is made under this title and that are furnished to individuals, who are patients of a MIPS eligible professional, by another supplier or provider of services during the most recent period for which data are available (such as the most recent three-month period), such as the name of such providers furnishing such items and services to such patients during such period, the types of such items and services so furnished, and the dates such items and services were so furnished.

(II)

Historical data, such as averages and other measures of the distribution if appropriate, of the total, and components of, allowed charges (and other figures as determined appropriate by the Secretary).

(13)

Review

(A)

Targeted review

The Secretary shall establish a process under which a MIPS eligible professional may seek an informal review of the calculation of the MIPS adjustment factor applicable to such eligible professional under this subsection for a year. The results of a review conducted pursuant to the previous sentence shall not be taken into account for purposes of paragraph (6) with respect to a year (other than with respect to the calculation of such eligible professional’s MIPS adjustment factor for such year or additional MIPS adjustment factor for such year) after the factors determined in subparagraph (A) and subparagraph (C) of such paragraph have been determined for such year.

(B)

Limitation

Except as provided for in subparagraph (A), there shall be no administrative or judicial review under section 1869, section 1878, or otherwise of the following:

(i)

The methodology used to determine the amount of the MIPS adjustment factor under paragraph (6)(A) and the amount of the additional MIPS adjustment factor under paragraph (6)(C)(i) and the determination of such amounts.

(ii)

The establishment of the performance standards under paragraph (3) and the performance period under paragraph (4).

(iii)

The identification of measures and activities specified under paragraph (2)(B) and information made public or posted on the Physician Compare Internet website of the Centers for Medicare Medicaid Services under paragraph (9).

(iv)

The methodology developed under paragraph (5) that is used to calculate performance scores and the calculation of such scores, including the weighting of measures and activities under such methodology.

.

(2)

GAO reports

(A)

Evaluation of eligible professional MIPS

Not later than October 1, 2019, and October 1, 2022, the Comptroller General of the United States shall submit to Congress a report evaluating the eligible professional Merit-based Incentive Payment System under subsection (q) of section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ), as added by paragraph (1). Such report shall—

(i)

examine the distribution of the composite performance scores and MIPS adjustment factors (and additional MIPS adjustment factors) for MIPS eligible professionals (as defined in subsection (q)(1)(c) of such section) under such program, and patterns relating to such scores and adjustment factors, including based on type of provider, practice size, geographic location, and patient mix;

(ii)

provide recommendations for improving such program;

(iii)

evaluate the impact of technical assistance funding under section 1848(q)(11) of the Social Security Act, as added by paragraph (1), on the ability of professionals to improve within such program or successfully transition to an alternative payment model (as defined in section 1833(z)(3) of the Social Security Act, as added by subsection (e)), with priority for such evaluation given to practices located in rural areas, health professional shortage areas (as designated in section 332(a)(1)(a) of the Public Health Service Act), and medically underserved areas; and

(iv)

provide recommendations for optimizing the use of such technical assistance funds.

(B)

Study to examine alignment of quality measures used in public and private programs

(i)

In general

Not later than 18 months after the date of the enactment of this Act, the Comptroller General of the United States shall submit to Congress a report that—

(I)

compares the similarities and differences in the use of quality measures under the original Medicare fee-for-service program under parts A and B of title XVIII of the Social Security Act, the Medicare Advantage program under part C of such title, selected State Medicaid programs under title XIX of such Act, and private payer arrangements; and

(II)

makes recommendations on how to reduce the administrative burden involved in applying such quality measures.

(ii)

Requirements

The report under clause (i) shall—

(I)

consider those measures applicable to individuals entitled to, or enrolled for, benefits under such part A, or enrolled under such part B and individuals under the age of 65; and

(II)

focus on those measures that comprise the most significant component of the quality performance category of the eligible professional MIPS incentive program under subsection (q) of section 1848 of the Social Security Act (42 U.S.C. 1395w–4), as added by paragraph (1).

(C)

Study on role of independent risk managers

Not later than January 1, 2016, the Comptroller General of the United States shall submit to Congress a report examining whether entities that pool financial risk for physician practices, such as independent risk managers, can play a role in supporting physician practices, particularly small physician practices, in assuming financial risk for the treatment of patients. Such report shall examine barriers that small physician practices currently face in assuming financial risk for treating patients, the types of risk management entities that could assist physician practices in participating in two-sided risk payment models, and how such entities could assist with risk management and with quality improvement activities. Such report shall also include an analysis of any existing legal barriers to such arrangements.

(D)

Study to examine rural and health professional shortage area alternative payment models

Not later than October 1, 2020, and October 1, 2022, the Comptroller General of the United States shall submit to Congress a report that examines the transition of professionals in rural areas, health professional shortage areas (as designated in section 332(a)(1)(A) of the Public Health Service Act), or medically underserved areas to an alternative payment model (as defined in section 1833(z)(3) of the Social Security Act, as added by subsection (e)). Such report shall make recommendations for removing administrative barriers to practices, including small practices consisting of 15 or fewer professionals, in rural areas, health professional shortage areas, and medically underserved areas to participation in such models.

(3)

Funding for implementation

For purposes of implementing the provisions of and the amendments made by this section, the Secretary of Health and Human Services shall provide for the transfer of $80,000,000 from the Supplementary Medical Insurance Trust Fund established under section 1841 of the Social Security Act (42 U.S.C. 1395t) to the Centers for Medicare Medicaid Program Management Account for each of the fiscal years 2014 through 2018. Amounts transferred under this paragraph shall be available until expended.

(d)

Improving quality reporting for composite scores

(1)

Changes for group reporting option

(A)

In general

Section 1848(m)(3)(C)(ii) of the Social Security Act ( 42 U.S.C. 1395w–4(m)(3)(C)(ii) ) is amended by inserting and, for 2015 and subsequent years, may provide after shall provide.

(B)

Clarification of qualified clinical data registry reporting to group practices

Section 1848(m)(3)(D) of the Social Security Act ( 42 U.S.C. 1395w–4(m)(3)(D) ) is amended by inserting and, for 2015 and subsequent years, subparagraph (A) or (C) after subparagraph (A).

(2)

Changes for multiple reporting periods and alternative criteria for satisfactory reporting

Section 1848(m)(5)(F) of the Social Security Act ( 42 U.S.C. 1395w–4(m)(5)(F) ) is amended—

(A)

by striking and subsequent years and inserting through reporting periods occurring in 2014; and

(B)

by inserting and, for reporting periods occurring in 2015 and subsequent years, the Secretary may establish following shall establish.

(3)

Physician feedback program reports succeeded by reports under MIPS

Section 1848(n) of the Social Security Act ( 42 U.S.C. 1395w–4(n) ) is amended by adding at the end the following new paragraph:

(11)

Reports ending with 2016

Reports under the Program shall not be provided after December 31, 2016. See subsection (q)(12) for reports under the eligible professionals Merit-based Incentive Payment System.

.

(4)

Coordination with satisfying meaningful EHR use clinical quality measure reporting requirement

Section 1848(o)(2)(A)(iii) of the Social Security Act ( 42 U.S.C. 1395w–4(o)(2)(A)(iii) ) is amended by inserting and subsection (q)(5)(B)(ii)(II) after Subject to subparagraph (B)(ii).

(e)

Promoting alternative payment models

(1)

Increasing transparency of physician focused payment models

Section 1868 of the Social Security Act ( 42 U.S.C. 1395ee ) is amended by adding at the end the following new subsection:

(c)

Physician focused payment models

(1)

Technical advisory committee

(A)

Establishment

There is established an ad hoc committee to be known as the Payment Model Technical Advisory Committee (referred to in this subsection as the Committee).

(B)

Membership

(i)

Number and appointment

The Committee shall be composed of 11 members appointed by the Comptroller General of the United States.

(ii)

Qualifications

The membership of the Committee shall include individuals with national recognition for their expertise in payment models and related delivery of care. No more than 5 members of the Committee shall be providers of services or suppliers, or representatives of providers of services or suppliers.

(iii)

Prohibition on federal employment

A member of the Committee shall not be an employee of the Federal Government.

(iv)

Ethics disclosure

The Comptroller General shall establish a system for public disclosure by members of the Committee of financial and other potential conflicts of interest relating to such members. Members of the Committee shall be treated as employees of Congress for purposes of applying title I of the Ethics in Government Act of 1978 ( Public Law 95–521 ).

(v)

Date of initial appointments

The initial appointments of members of the Committee shall be made by not later than 180 days after the date of enactment of this subsection.

(C)

Term; vacancies

(i)

Term

The terms of members of the Committee shall be for 3 years except that the Comptroller General shall designate staggered terms for the members first appointed.

(ii)

Vacancies

Any member appointed to fill a vacancy occurring before the expiration of the term for which the member’s predecessor was appointed shall be appointed only for the remainder of that term. A member may serve after the expiration of that member’s term until a successor has taken office. A vacancy in the Committee shall be filled in the manner in which the original appointment was made.

(D)

Duties

The Committee shall meet, as needed, to provide comments and recommendations to the Secretary, as described in paragraph (2)(C), on physician-focused payment models.

(E)

Compensation of members

(i)

In general

Except as provided in clause (ii), a member of the Committee shall serve without compensation.

(ii)

Travel expenses

A member of the Committee shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for an employee of an agency under subchapter I of chapter 57 of title 5, United States Code, while away from the home or regular place of business of the member in the performance of the duties of the Committee.

(F)

Operational and technical support

(i)

In general

The Assistant Secretary for Planning and Evaluation shall provide technical and operational support for the Committee, which may be by use of a contractor. The Office of the Actuary of the Centers for Medicare Medicaid Services shall provide to the Committee actuarial assistance as needed.

(ii)

Funding

The Secretary shall provide for the transfer, from the Federal Supplementary Medical Insurance Trust Fund under section 1841, such amounts as are necessary to carry out clause (i) (not to exceed $5,000,000) for fiscal year 2014 and each subsequent fiscal year. Any amounts transferred under the preceding sentence for a fiscal year shall remain available until expended.

(G)

Application

Section 14 of the Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to the Committee.

(2)

Criteria and process for submission and review of physician-focused payment models

(A)

Criteria for assessing physician-focused payment models

(i)

Rulemaking

Not later than November 1, 2015, the Secretary shall, through notice and comment rulemaking, following a request for information, establish criteria for physician-focused payment models, including models for specialist physicians, that could be used by the Committee for making comments and recommendations pursuant to paragraph (1)(D).

(ii)

MedPAC submission of comments

During the comment period for the proposed rule described in clause (i), the Medicare Payment Advisory Commission may submit comments to the Secretary on the proposed criteria under such clause.

(iii)

Updating

The Secretary may update the criteria established under this subparagraph through rulemaking.

(B)

Stakeholder submission of physician focused payment models

On an ongoing basis, individuals and stakeholder entities may submit to the Committee proposals for physician-focused payment models that such individuals and entities believe meet the criteria described in subparagraph (A).

(C)

TAC review of models submitted

The Committee shall, on a periodic basis, review models submitted under subparagraph (B), prepare comments and recommendations regarding whether such models meet the criteria described in subparagraph (A), and submit such comments and recommendations to the Secretary.

(D)

Secretary review and response

The Secretary shall review the comments and recommendations submitted by the Committee under subparagraph (C) and post a detailed response to such comments and recommendations on the Internet website of the Centers for Medicare Medicaid Services.

(3)

Rule of construction

Nothing in this subsection shall be construed to impact the development or testing of models under this title or titles XI, XIX, or XXI.

.

(2)

Incentive payments for participation in eligible alternative payment models

Section 1833 of the Social Security Act ( 42 U.S.C. 1395l ) is amended by adding at the end the following new subsection:

(z)

Incentive payments for participation in eligible alternative payment models

(1)

Payment incentive

(A)

In general

In the case of covered professional services furnished by an eligible professional during a year that is in the period beginning with 2018 and ending with 2023 and for which the professional is a qualifying APM participant, in addition to the amount of payment that would otherwise be made for such covered professional services under this part for such year, there also shall be paid to such professional an amount equal to 5 percent of the payment amount for the covered professional services under this part for the preceding year. For purposes of the previous sentence, the payment amount for the preceding year may be an estimation for the full preceding year based on a period of such preceding year that is less than the full year. The Secretary shall establish policies to implement this subparagraph in cases where payment for covered professional services furnished by a qualifying APM participant in an alternative payment model is made to an entity participating in the alternative payment model rather than directly to the qualifying APM participant.

(B)

Form of payment

Payments under this subsection shall be made in a lump sum, on an annual basis, as soon as practicable.

(C)

Treatment of payment incentive

Payments under this subsection shall not be taken into account for purposes of determining actual expenditures under an alternative payment model and for purposes of determining or rebasing any benchmarks used under the alternative payment model.

(D)

Coordination

The amount of the additional payment for an item or service under this subsection or subsection (m) shall be determined without regard to any additional payment for the item or service under subsection (m) and this subsection, respectively. The amount of the additional payment for an item or service under this subsection or subsection (x) shall be determined without regard to any additional payment for the item or service under subsection (x) and this subsection, respectively. The amount of the additional payment for an item or service under this subsection or subsection (y) shall be determined without regard to any additional payment for the item or service under subsection (y) and this subsection, respectively.

(2)

Qualifying APM participant

For purposes of this subsection, the term qualifying APM participant means the following:

(A)

2018 and 2019

With respect to 2018 and 2019, an eligible professional for whom the Secretary determines that at least 25 percent of payments under this part for covered professional services furnished by such professional during the most recent period for which data are available (which may be less than a year) were attributable to such services furnished under this part through an entity that participates in an eligible alternative payment model with respect to such services.

(B)

2020 and 2021

With respect to 2020 and 2021, an eligible professional described in either of the following clauses:

(i)

Medicare revenue threshold option

An eligible professional for whom the Secretary determines that at least 50 percent of payments under this part for covered professional services furnished by such professional during the most recent period for which data are available (which may be less than a year) were attributable to such services furnished under this part through an entity that participates in an eligible alternative payment model with respect to such services.

(ii)

Combination all-payer and Medicare revenue threshold option

An eligible professional—

(I)

for whom the Secretary determines, with respect to items and services furnished by such professional during the most recent period for which data are available (which may be less than a year), that at least 50 percent of the sum of—

(aa)

payments described in clause (i); and

(bb)

all other payments, regardless of payer (other than payments made by the Secretary of Defense or the Secretary of Veterans Affairs under chapter 55 of title 10, United States Code, or title 38, United States Code, or any other provision of law, and other than payments made under title XIX in a State in which no medical home or alternative payment model is available under the State program under that title),

meet the requirement described in clause (iii)(I) with respect to payments described in item (aa) and meet the requirement described in clause (iii)(II) with respect to payments described in item (bb);
(II)

for whom the Secretary determines at least 25 percent of payments under this part for covered professional services furnished by such professional during the most recent period for which data are available (which may be less than a year) were attributable to such services furnished under this part through an entity that participates in an eligible alternative payment model with respect to such services; and

(III)

who provides to the Secretary such information as is necessary for the Secretary to make a determination under subclause (I), with respect to such professional.

(iii)

Requirement

For purposes of clause (ii)(I)—

(I)

the requirement described in this subclause, with respect to payments described in item (aa) of such clause, is that such payments are made under an eligible alternative payment model; and

(II)

the requirement described in this subclause, with respect to payments described in item (bb) of such clause, is that such payments are made under an arrangement in which—

(aa)

quality measures comparable to measures under the performance category described in section 1848(q)(2)(B)(i) apply;

(bb)

certified EHR technology is used; and

(cc)

the eligible professional (AA) bears more than nominal financial risk if actual aggregate expenditures exceeds expected aggregate expenditures; or (BB) is a medical home (with respect to beneficiaries under title XIX) that meets criteria comparable to medical homes expanded under section 1115A(c).

(C)

Beginning in 2022

With respect to 2022 and each subsequent year, an eligible professional described in either of the following clauses:

(i)

Medicare revenue threshold option

An eligible professional for whom the Secretary determines that at least 75 percent of payments under this part for covered professional services furnished by such professional during the most recent period for which data are available (which may be less than a year) were attributable to such services furnished under this part through an entity that participates in an eligible alternative payment model with respect to such services.

(ii)

Combination all-payer and Medicare revenue threshold option

An eligible professional—

(I)

for whom the Secretary determines, with respect to items and services furnished by such professional during the most recent period for which data are available (which may be less than a year), that at least 75 percent of the sum of—

(aa)

payments described in clause (i); and

(bb)

all other payments, regardless of payer (other than payments made by the Secretary of Defense or the Secretary of Veterans Affairs under chapter 55 of title 10, United States Code, or title 38, United States Code, or any other provision of law, and other than payments made under title XIX in a State in which no medical home or alternative payment model is available under the State program under that title),

meet the requirement described in clause (iii)(I) with respect to payments described in item (aa) and meet the requirement described in clause (iii)(II) with respect to payments described in item (bb);
(II)

for whom the Secretary determines at least 25 percent of payments under this part for covered professional services furnished by such professional during the most recent period for which data are available (which may be less than a year) were attributable to such services furnished under this part through an entity that participates in an eligible alternative payment model with respect to such services; and

(III)

who provides to the Secretary such information as is necessary for the Secretary to make a determination under subclause (I), with respect to such professional.

(iii)

Requirement

For purposes of clause (ii)(I)—

(I)

the requirement described in this subclause, with respect to payments described in item (aa) of such clause, is that such payments are made under an eligible alternative payment model; and

(II)

the requirement described in this subclause, with respect to payments described in item (bb) of such clause, is that such payments are made under an arrangement in which—

(aa)

quality measures comparable to measures under the performance category described in section 1848(q)(2)(B)(i) apply;

(bb)

certified EHR technology is used; and

(cc)

the eligible professional (AA) bears more than nominal financial risk if actual aggregate expenditures exceeds expected aggregate expenditures; or (BB) is a medical home (with respect to beneficiaries under title XIX) that meets criteria comparable to medical homes expanded under section 1115A(c).

(3)

Additional definitions

In this subsection:

(A)

Covered professional services

The term covered professional services has the meaning given that term in section 1848(k)(3)(A).

(B)

Eligible professional

The term eligible professional has the meaning given that term in section 1848(k)(3)(B).

(C)

Alternative payment model (APM)

The term alternative payment model means any of the following:

(i)

A model under section 1115A (other than a health care innovation award).

(ii)

The shared savings program under section 1899.

(iii)

A demonstration under section 1866C.

(iv)

A demonstration required by Federal law.

(D)

Eligible alternative payment model (APM)

(i)

In general

The term eligible alternative payment model means, with respect to a year, an alternative payment model—

(I)

that requires use of certified EHR technology (as defined in subsection (o)(4));

(II)

that provides for payment for covered professional services based on quality measures comparable to measures under the performance category described in section 1848(q)(2)(B)(i); and

(III)

that satisfies the requirement described in clause (ii).

(ii)

Additional requirement

For purposes of clause (i)(III), the requirement described in this clause, with respect to a year and an alternative payment model, is that the alternative payment model—

(I)

is one in which one or more entities bear financial risk for monetary losses under such model that are in excess of a nominal amount; or

(II)

is a medical home expanded under section 1115A(c).

(4)

Limitation

There shall be no administrative or judicial review under section 1869, 1878, or otherwise, of the following:

(A)

The determination that an eligible professional is a qualifying APM participant under paragraph (2) and the determination that an alternative payment model is an eligible alternative payment model under paragraph (3)(D).

(B)

The determination of the amount of the 5 percent payment incentive under paragraph (1)(A), including any estimation as part of such determination.

.

(3)

Coordination conforming amendments

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

(A)

in subsection (x)(3), by adding at the end the following new sentence: The amount of the additional payment for a service under this subsection and subsection (z) shall be determined without regard to any additional payment for the service under subsection (z) and this subsection, respectively.; and

(B)

in subsection (y)(3), by adding at the end the following new sentence: The amount of the additional payment for a service under this subsection and subsection (z) shall be determined without regard to any additional payment for the service under subsection (z) and this subsection, respectively..

(4)

Encouraging development and testing of certain models

Section 1115A(b)(2) of the Social Security Act ( 42 U.S.C. 1315a(b)(2) ) is amended—

(A)

in subparagraph (B), by adding at the end the following new clauses:

(xxi)

Focusing primarily on physicians’ services (as defined in section 1848(j)(3)) furnished by physicians who are not primary care practitioners.

(xxii)

Focusing on practices of 15 or fewer professionals.

(xxiii)

Focusing on risk-based models for small physician practices which may involve two-sided risk and prospective patient assignment, and which examine risk-adjusted decreases in mortality rates, hospital readmissions rates, and other relevant and appropriate clinical measures.

(xxiv)

Focusing primarily on title XIX, working in conjunction with the Center for Medicaid and CHIP Services.

; and

(B)

in subparagraph (C)(viii), by striking other public sector or private sector payers and inserting other public sector payers, private sector payers, or Statewide payment models.

(5)

Construction regarding telehealth services

Nothing in the provisions of, or amendments made by, this Act shall be construed as precluding an alternative payment model or a qualifying APM participant (as those terms are defined in section 1833(z) of the Social Security Act, as added by paragraph (1)) from furnishing a telehealth service for which payment is not made under section 1834(m) of the Social Security Act (42 U.S.C. 1395m(m)).

(6)

Integrating Medicare Advantage alternative payment models

Not later than July 1, 2015, the Secretary of Health and Human Services shall submit to Congress a study that examines the feasibility of integrating alternative payment models in the Medicare Advantage payment system. The study shall include the feasibility of including a value-based modifier and whether such modifier should be budget neutral.

(7)

Study and report on fraud related to alternative payment models under the Medicare program

(A)

Study

The Secretary of Health and Human Services, in consultation with the Inspector General of the Department of Health and Human Services, shall conduct a study that—

(i)

examines the applicability of the Federal fraud prevention laws to items and services furnished under title XVIII of the Social Security Act for which payment is made under an alternative payment model (as defined in section 1833(z)(3)(C) of such Act ( 42 U.S.C. 1395l(z)(3)(C) ));

(ii)

identifies aspects of such alternative payment models that are vulnerable to fraudulent activity; and

(iii)

examines the implications of waivers to such laws granted in support of such alternative payment models, including under any potential expansion of such models.

(B)

Report

Not later than 2 years after the date of the enactment of this Act, the Secretary shall submit to Congress a report containing the results of the study conducted under subparagraph (A). Such report shall include recommendations for actions to be taken to reduce the vulnerability of such alternative payment models to fraudulent activity. Such report also shall include, as appropriate, recommendations of the Inspector General for changes in Federal fraud prevention laws to reduce such vulnerability.

(f)

Improving payment accuracy

(1)

Studies and reports of effect of certain information on quality and resource use

(A)

Study using existing Medicare data

(i)

Study

The Secretary of Health and Human Services (in this subsection referred to as the Secretary) shall conduct a study that examines the effect of individuals’ socioeconomic status on quality and resource use outcome measures for individuals under the Medicare program (such as to recognize that less healthy individuals may require more intensive interventions). The study shall use information collected on such individuals in carrying out such program, such as urban and rural location, eligibility for Medicaid (recognizing and accounting for varying Medicaid eligibility across States), and eligibility for benefits under the supplemental security income (SSI) program. The Secretary shall carry out this paragraph acting through the Assistant Secretary for Planning and Evaluation.

(ii)

Report

Not later than 2 years after the date of the enactment of this Act, the Secretary shall submit to Congress a report on the study conducted under clause (i).

(B)

Study using other data

(i)

Study

The Secretary shall conduct a study that examines the impact of risk factors, such as those described in section 1848(p)(3) of the Social Security Act (42 U.S.C. 1395w–4(p)(3)), race, health literacy, limited English proficiency (LEP), and patient activation, on quality and resource use outcome measures under the Medicare program (such as to recognize that less healthy individuals may require more intensive interventions). In conducting such study the Secretary may use existing Federal data and collect such additional data as may be necessary to complete the study.

(ii)

Report

Not later than 5 years after the date of the enactment of this Act, the Secretary shall submit to Congress a report on the study conducted under clause (i).

(C)

Examination of data in conducting studies

In conducting the studies under subparagraphs (A) and (B), the Secretary shall examine what non-Medicare data sets, such as data from the American Community Survey (ACS), can be useful in conducting the types of studies under such paragraphs and how such data sets that are identified as useful can be coordinated with Medicare administrative data in order to improve the overall data set available to do such studies and for the administration of the Medicare program.

(D)

Recommendations to account for information in payment adjustment mechanisms

If the studies conducted under subparagraphs (A) and (B) find a relationship between the factors examined in the studies and quality and resource use outcome measures, then the Secretary shall also provide recommendations for how the Centers for Medicare Medicaid Services should—

(i)

obtain access to the necessary data (if such data is not already being collected) on such factors, including recommendations on how to address barriers to the Centers in accessing such data; and

(ii)

account for such factors in determining payment adjustments based on quality and resource use outcome measures under the eligible professional Merit-based Incentive Payment System under section 1848(q) of the Social Security Act (42 U.S.C. 1395w–4(q)) and, as the Secretary determines appropriate, other similar provisions of title XVIII of such Act.

(E)

Funding

There are hereby appropriated from the Federal Supplementary Medical Insurance Trust Fund under section 1841 of the Social Security Act to the Secretary to carry out this paragraph $6,000,000, to remain available until expended.

(2)

CMS activities

(A)

Hierarchal Condition Category (HCC) improvement

Taking into account the relevant studies conducted and recommendations made in reports under paragraph (1), the Secretary, on an ongoing basis, shall, as the Secretary determines appropriate, estimate how an individual’s health status and other risk factors affect quality and resource use outcome measures and, as feasible, shall incorporate information from quality and resource use outcome measurement (including care episode and patient condition groups) into provisions of title XVIII of the Social Security Act that are similar to the eligible professional Merit-based Incentive Payment System under section 1848(q) of such Act.

(B)

Accounting for other factors in payment adjustment mechanisms

(i)

In general

Taking into account the studies conducted and recommendations made in reports under paragraph (1) and other information as appropriate, the Secretary shall, as the Secretary determines appropriate, account for identified factors with an effect on quality and resource use outcome measures when determining payment adjustment mechanisms under provisions of title XVIII of the Social Security Act that are similar to the eligible professional Merit-based Incentive Payment System under section 1848(q) of such Act.

(ii)

Accessing data

The Secretary shall collect or otherwise obtain access to the data necessary to carry out this paragraph through existing and new data sources.

(iii)

Periodic analyses

The Secretary shall carry out periodic analyses, at least every 3 years, based on the factors referred to in clause (i) so as to monitor changes in possible relationships.

(C)

Funding

There are hereby appropriated from the Federal Supplementary Medical Insurance Trust Fund under section 1841 of the Social Security Act to the Secretary to carry out this paragraph and the application of this paragraph to the Merit-based Incentive Payment System under section 1848(q) of such Act $10,000,000, to remain available until expended.

(3)

Strategic plan for accessing race and ethnicity data

Not later than 18 months after the date of the enactment of this Act, the Secretary shall develop and report to Congress on a strategic plan for collecting or otherwise accessing data on race and ethnicity for purposes of carrying out the eligible professional Merit-based Incentive Payment System under section 1848(q) of the Social Security Act and, as the Secretary determines appropriate, other similar provisions of title XVIII of such Act.

(g)

Collaborating with the physician, practitioner, and other stakeholder communities To improve resource use measurement

Section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ), as amended by subsection (c), is further amended by adding at the end the following new subsection:

(r)

Collaborating with the physician, practitioner, and other stakeholder communities To improve resource use measurement

(1)

In general

In order to involve the physician, practitioner, and other stakeholder communities in enhancing the infrastructure for resource use measurement, including for purposes of the value-based performance incentive program under subsection (q) and alternative payment models under section 1833(z), the Secretary shall undertake the steps described in the succeeding provisions of this subsection.

(2)

Development of care episode and patient condition groups and classification codes

(A)

In general

In order to classify similar patients into care episode groups and patient condition groups, the Secretary shall undertake the steps described in the succeeding provisions of this paragraph.

(B)

Public availability of existing efforts to design an episode grouper

Not later than 120 days after the date of the enactment of this subsection, the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services a list of the episode groups developed pursuant to subsection (n)(9)(A) and related descriptive information.

(C)

Stakeholder input

The Secretary shall accept, through the date that is 60 days after the day the Secretary posts the list pursuant to subparagraph (B), suggestions from physician specialty societies, applicable practitioner organizations, and other stakeholders for episode groups in addition to those posted pursuant to such subparagraph, and specific clinical criteria and patient characteristics to classify patients into—

(i)

care episode groups; and

(ii)

patient condition groups.

(D)

Development of proposed classification codes

(i)

In general

Taking into account the information described in subparagraph (B) and the information received under subparagraph (C), the Secretary shall—

(I)

establish care episode groups and patient condition groups, which account for a target of an estimated 2/3 of expenditures under parts A and B; and

(II)

assign codes to such groups.

(ii)

Care episode groups

In establishing the care episode groups under clause (i), the Secretary shall take into account—

(I)

the patient’s clinical problems at the time items and services are furnished during an episode of care, such as the clinical conditions or diagnoses, whether or not inpatient hospitalization is anticipated or occurs, and the principal procedures or services planned or furnished; and

(II)

other factors determined appropriate by the Secretary.

(iii)

Patient condition groups

In establishing the patient condition groups under clause (i), the Secretary shall take into account—

(I)

the patient’s clinical history at the time of each medical visit, such as the patient’s combination of chronic conditions, current health status, and recent significant history (such as hospitalization and major surgery during a previous period, such as 3 months); and

(II)

other factors determined appropriate by the Secretary, such as eligibility status under this title (including eligibility under section 226(a), 226(b), or 226A, and dual eligibility under this title and title XIX).

(E)

Draft care episode and patient condition groups and classification codes

Not later than 180 days after the end of the comment period described in subparagraph (C), the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services a draft list of the care episode and patient condition codes established under subparagraph (D) (and the criteria and characteristics assigned to such code).

(F)

Solicitation of input

The Secretary shall seek, through the date that is 60 days after the Secretary posts the list pursuant to subparagraph (E), comments from physician specialty societies, applicable practitioner organizations, and other stakeholders, including representatives of individuals entitled to benefits under part A or enrolled under this part, regarding the care episode and patient condition groups (and codes) posted under subparagraph (E). In seeking such comments, the Secretary shall use one or more mechanisms (other than notice and comment rulemaking) that may include use of open door forums, town hall meetings, or other appropriate mechanisms.

(G)

Operational list of care episode and patient condition groups and codes

Not later than 180 days after the end of the comment period described in subparagraph (F), taking into account the comments received under such subparagraph, the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services an operational list of care episode and patient condition codes (and the criteria and characteristics assigned to such code).

(H)

Subsequent revisions

Not later than November 1 of each year (beginning with 2017), the Secretary shall, through rulemaking, make revisions to the operational lists of care episode and patient condition codes as the Secretary determines may be appropriate. Such revisions may be based on experience, new information developed pursuant to subsection (n)(9)(A), and input from the physician specialty societies, applicable practitioner organizations, and other stakeholders, including representatives of individuals entitled to benefits under part A or enrolled under this part.

(3)

Attribution of patients to physicians or practitioners

(A)

In general

In order to facilitate the attribution of patients and episodes (in whole or in part) to one or more physicians or applicable practitioners furnishing items and services, the Secretary shall undertake the steps described in the succeeding provisions of this paragraph.

(B)

Development of patient relationship categories and codes

The Secretary shall develop patient relationship categories and codes that define and distinguish the relationship and responsibility of a physician or applicable practitioner with a patient at the time of furnishing an item or service. Such patient relationship categories shall include different relationships of the physician or applicable practitioner to the patient (and the codes may reflect combinations of such categories), such as a physician or applicable practitioner who—

(i)

considers themself to have the primary responsibility for the general and ongoing care for the patient over extended periods of time;

(ii)

considers themself to be the lead physician or practitioner and who furnishes items and services and coordinates care furnished by other physicians or practitioners for the patient during an acute episode;

(iii)

furnishes items and services to the patient on a continuing basis during an acute episode of care, but in a supportive rather than a lead role;

(iv)

furnishes items and services to the patient on an occasional basis, usually at the request of another physician or practitioner; or

(v)

furnishes items and services only as ordered by another physician or practitioner.

(C)

Draft list of patient relationship categories and codes

Not later than 270 days after the date of the enactment of this subsection, the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services a draft list of the patient relationship categories and codes developed under subparagraph (B).

(D)

Stakeholder Input

The Secretary shall seek, through the date that is 60 days after the Secretary posts the list pursuant to subparagraph (C), comments from physician specialty societies, applicable practitioner organizations, and other stakeholders, including representatives of individuals entitled to benefits under part A or enrolled under this part, regarding the patient relationship categories and codes posted under subparagraph (C). In seeking such comments, the Secretary shall use one or more mechanisms (other than notice and comment rulemaking) that may include open door forums, town hall meetings, or other appropriate mechanisms.

(E)

Operational list of patient relationship categories and codes

Not later than 180 days after the end of the comment period described in subparagraph (D), taking into account the comments received under such subparagraph, the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services an operational list of patient relationship categories and codes.

(F)

Subsequent revisions

Not later than November 1 of each year (beginning with 2017), the Secretary shall, through rulemaking, make revisions to the operational list of patient relationship categories and codes as the Secretary determines appropriate. Such revisions may be based on experience, new information developed pursuant to subsection (n)(9)(A), and input from the physician specialty societies, applicable practitioner organizations, and other stakeholders, including representatives of individuals entitled to benefits under part A or enrolled under this part.

(4)

Reporting of information for resource use measurement

Claims submitted for items and services furnished by a physician or applicable practitioner on or after January 1, 2017, shall, as determined appropriate by the Secretary, include—

(A)

applicable codes established under paragraphs (2) and (3); and

(B)

the national provider identifier of the ordering physician or applicable practitioner (if different from the billing physician or applicable practitioner).

(5)

Methodology for resource use analysis

(A)

In general

In order to evaluate the resources used to treat patients (with respect to care episode and patient condition groups), the Secretary shall—

(i)

use the patient relationship codes reported on claims pursuant to paragraph (4) to attribute patients (in whole or in part) to one or more physicians and applicable practitioners;

(ii)

use the care episode and patient condition codes reported on claims pursuant to paragraph (4) as a basis to compare similar patients and care episodes and patient condition groups; and

(iii)

conduct an analysis of resource use (with respect to care episodes and patient condition groups of such patients), as the Secretary determines appropriate.

(B)

Analysis of patients of physicians and practitioners

In conducting the analysis described in subparagraph (A)(iii) with respect to patients attributed to physicians and applicable practitioners, the Secretary shall, as feasible—

(i)

use the claims data experience of such patients by patient condition codes during a common period, such as 12 months; and

(ii)

use the claims data experience of such patients by care episode codes—

(I)

in the case of episodes without a hospitalization, during periods of time (such as the number of days) determined appropriate by the Secretary; and

(II)

in the case of episodes with a hospitalization, during periods of time (such as the number of days) before, during, and after the hospitalization.

(C)

Measurement of resource use

In measuring such resource use, the Secretary

(i)

shall use per patient total allowed charges for all services under part A and this part (and, if the Secretary determines appropriate, part D) for the analysis of patient resource use, by care episode codes and by patient condition codes; and

(ii)

may, as determined appropriate, use other measures of allowed charges (such as subtotals for categories of items and services) and measures of utilization of items and services (such as frequency of specific items and services and the ratio of specific items and services among attributed patients or episodes).

(D)

Stakeholder Input

The Secretary shall seek comments from the physician specialty societies, applicable practitioner organizations, and other stakeholders, including representatives of individuals entitled to benefits under part A or enrolled under this part, regarding the resource use methodology established pursuant to this paragraph. In seeking comments the Secretary shall use one or more mechanisms (other than notice and comment rulemaking) that may include open door forums, town hall meetings, or other appropriate mechanisms.

(6)

Implementation

To the extent that the Secretary contracts with an entity to carry out any part of the provisions of this subsection, the Secretary may not contract with an entity or an entity with a subcontract if the entity or subcontracting entity currently makes recommendations to the Secretary on relative values for services under the fee schedule for physicians’ services under this section.

(7)

Limitation

There shall be no administrative or judicial review under section 1869, section 1878, or otherwise of—

(A)

care episode and patient condition groups and codes established under paragraph (2);

(B)

patient relationship categories and codes established under paragraph (3); and

(C)

measurement of, and analyses of resource use with respect to, care episode and patient condition codes and patient relationship codes pursuant to paragraph (5).

(8)

Administration

Chapter 35 of title 44, United States Code, shall not apply to this section.

(9)

Definitions

In this section:

(A)

Physician

The term physician has the meaning given such term in section 1861(r)(1).

(B)

Applicable practitioner

The term applicable practitioner means—

(i)

a physician assistant, nurse practitioner, and clinical nurse specialist (as such terms are defined in section 1861(aa)(5)), and a certified registered nurse anesthetist (as defined in section 1861(bb)(2)); and

(ii)

beginning January 1, 2018, such other eligible professionals (as defined in subsection (k)(3)(B)) as specified by the Secretary.

(10)

Clarification

The provisions of sections 1890(b)(7) and 1890A shall not apply to this subsection.

.

3.

Priorities and funding for measure development

Section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ), as amended by subsections (c) and (g) of section 2, is further amended by inserting at the end the following new subsection:

(s)

Priorities and funding for measure development

(1)

Plan identifying measure development priorities and timelines

(A)

Draft measure development plan

Not later than January 1, 2015, the Secretary shall develop, and post on the Internet website of the Centers for Medicare Medicaid Services, a draft plan for the development of quality measures for application under the applicable provisions (as defined in paragraph (5)). Under such plan the Secretary shall—

(i)

address how measures used by private payers and integrated delivery systems could be incorporated under title XVIII;

(ii)

describe how coordination, to the extent possible, will occur across organizations developing such measures; and

(iii)

take into account how clinical best practices and clinical practice guidelines should be used in the development of quality measures.

(B)

Quality domains

For purposes of this subsection, the term quality domains means at least the following domains:

(i)

Clinical care.

(ii)

Safety.

(iii)

Care coordination.

(iv)

Patient and caregiver experience.

(v)

Population health and prevention.

(C)

Consideration

In developing the draft plan under this paragraph, the Secretary shall consider—

(i)

gap analyses conducted by the entity with a contract under section 1890(a) or other contractors or entities;

(ii)

whether measures are applicable across health care settings;

(iii)

clinical practice improvement activities submitted under subsection (q)(2)(C)(iv) for identifying possible areas for future measure development and identifying existing gaps with respect to such measures; and

(iv)

the quality domains applied under this subsection.

(D)

Priorities

In developing the draft plan under this paragraph, the Secretary shall give priority to the following types of measures:

(i)

Outcome measures, including patient reported outcome and functional status measures.

(ii)

Patient experience measures.

(iii)

Care coordination measures.

(iv)

Measures of appropriate use of services, including measures of over use.

(E)

Stakeholder input

The Secretary shall accept through March 1, 2015, comments on the draft plan posted under paragraph (1)(A) from the public, including health care providers, payers, consumers, and other stakeholders.

(F)

Final measure development plan

Not later than May 1, 2015, taking into account the comments received under this subparagraph, the Secretary shall finalize the plan and post on the Internet website of the Centers for Medicare Medicaid Services an operational plan for the development of quality measures for use under the applicable provisions. Such plan shall be updated as appropriate.

(2)

Contracts and other arrangements for quality measure development

(A)

In general

The Secretary shall enter into contracts or other arrangements with entities for the purpose of developing, improving, updating, or expanding in accordance with the plan under paragraph (1) quality measures for application under the applicable provisions. Such entities shall include organizations with quality measure development expertise.

(B)

Prioritization

(i)

In general

In entering into contracts or other arrangements under subparagraph (A), the Secretary shall give priority to the development of the types of measures described in paragraph (1)(D).

(ii)

Consideration

In selecting measures for development under this subsection, the Secretary shall consider—

(I)

whether such measures would be electronically specified; and

(II)

clinical practice guidelines to the extent that such guidelines exist.

(3)

Annual report by the Secretary

(A)

In general

Not later than May 1, 2016, and annually thereafter, the Secretary shall post on the Internet website of the Centers for Medicare Medicaid Services a report on the progress made in developing quality measures for application under the applicable provisions.

(B)

Requirements

Each report submitted pursuant to subparagraph (A) shall include the following:

(i)

A description of the Secretary’s efforts to implement this paragraph.

(ii)

With respect to the measures developed during the previous year—

(I)

a description of the total number of quality measures developed and the types of such measures, such as an outcome or patient experience measure;

(II)

the name of each measure developed;

(III)

the name of the developer and steward of each measure;

(IV)

with respect to each type of measure, an estimate of the total amount expended under this title to develop all measures of such type; and

(V)

whether the measure would be electronically specified.

(iii)

With respect to measures in development at the time of the report—

(I)

the information described in clause (ii), if available; and

(II)

a timeline for completion of the development of such measures.

(iv)

A description of any updates to the plan under paragraph (1) (including newly identified gaps and the status of previously identified gaps) and the inventory of measures applicable under the applicable provisions.

(v)

Other information the Secretary determines to be appropriate.

(4)

Stakeholder input

With respect to paragraph (1), the Secretary shall seek stakeholder input with respect to—

(A)

the identification of gaps where no quality measures exist, particularly with respect to the types of measures described in paragraph (1)(D);

(B)

prioritizing quality measure development to address such gaps; and

(C)

other areas related to quality measure development determined appropriate by the Secretary.

(5)

Definition of applicable provisions

In this subsection, the term applicable provisions means the following provisions:

(A)

Subsection (q)(2)(B)(i).

(B)

Section 1833(z)(2)(C).

(6)

Funding

For purposes of carrying out this subsection, the Secretary shall provide for the transfer, from the Federal Supplementary Medical Insurance Trust Fund under section 1841, of $15,000,000 to the Centers for Medicare Medicaid Services Program Management Account for each of fiscal years 2014 through 2018. Amounts transferred under this paragraph shall remain available through the end of fiscal year 2021.

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4.

Encouraging care management for individuals with chronic care needs

(a)

In general

Section 1848(b) of the Social Security Act ( 42 U.S.C. 1395w–4(b) ) is amended by adding at the end the following new paragraph:

(8)

Encouraging care management for individuals with chronic care needs

(A)

In general

In order to encourage the management of care by an applicable provider (as defined in subparagraph (B)) for individuals with chronic care needs the Secretary shall—

(i)

establish one or more HCPCS codes for chronic care management services for such individuals; and

(ii)

subject to subparagraph (D), make payment (as the Secretary determines to be appropriate) under this section for such management services furnished on or after January 1, 2015, by an applicable provider.

(B)

Applicable provider defined

For purposes of this paragraph, the term applicable provider means a physician (as defined in section 1861(r)(1)), physician assistant or nurse practitioner (as defined in section 1861(aa)(5)(A)), or clinical nurse specialist (as defined in section 1861(aa)(5)(B)) who furnishes services as part of a patient-centered medical home or a comparable specialty practice that—

(i)

is recognized as such a medical home or comparable specialty practice by an organization that is recognized by the Secretary for purposes of such recognition as such a medical home or practice; or

(ii)

meets such other comparable qualifications as the Secretary determines to be appropriate.

(C)

Budget neutrality

The budget neutrality provision under subsection (c)(2)(B)(ii)(II) shall apply in establishing the payment under subparagraph (A)(ii).

(D)

Policies relating to payment

In carrying out this paragraph, with respect to chronic care management services, the Secretary shall—

(i)

make payment to only one applicable provider for such services furnished to an individual during a period;

(ii)

not make payment under subparagraph (A) if such payment would be duplicative of payment that is otherwise made under this title for such services (such as in the case of hospice care or home health services); and

(iii)

not require that an annual wellness visit (as defined in section 1861(hhh)) or an initial preventive physical examination (as defined in section 1861(ww)) be furnished as a condition of payment for such management services.

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(b)

Education and outreach

(1)

Campaign

(A)

In general

The Secretary of Health and Human Services (in this subsection referred to as the Secretary) shall conduct an education and outreach campaign to inform professionals who furnish items and services under part B of title XVIII of the Social Security Act and individuals enrolled under such part of the benefits of chronic care management services described in section 1848(b)(8) of the Social Security Act, as added by subsection (a), and encourage such individuals with chronic care needs to receive such services.

(B)

Requirements

Such campaign shall—

(i)

be directed by the Office of Rural Health Policy of the Department of Health and Human Services and the Office of Minority Health of the Centers for Medicare Medicaid Services; and

(ii)

focus on encouraging participation by underserved rural populations and racial and ethnic minority populations.

(2)

Report

(A)

In general

Not later than December 31, 2017, the Secretary shall submit to Congress a report on the use of chronic care management services described in such section 1848(b)(8) by individuals living in rural areas and by racial and ethnic minority populations. Such report shall—

(i)

identify barriers to receiving chronic care management services; and

(ii)

make recommendations for increasing the appropriate use of chronic care management services.

5.

Ensuring accurate valuation of services under the physician fee schedule

(a)

Authority To collect and use information on physicians’ services in the determination of relative values

(1)

In general

Section 1848(c)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2) ) is amended by adding at the end the following new subparagraph:

(M)

Authority to collect and use information on physicians’ services in the determination of relative values

(i)

Collection of information

Notwithstanding any other provision of law, the Secretary may collect or obtain information on the resources directly or indirectly related to furnishing services for which payment is made under the fee schedule established under subsection (b). Such information may be collected or obtained from any eligible professional or any other source.

(ii)

Use of information

Notwithstanding any other provision of law, subject to clause (v), the Secretary may (as the Secretary determines appropriate) use information collected or obtained pursuant to clause (i) in the determination of relative values for services under this section.

(iii)

Types of information

The types of information described in clauses (i) and (ii) may, at the Secretary’s discretion, include any or all of the following:

(I)

Time involved in furnishing services.

(II)

Amounts and types of practice expense inputs involved with furnishing services.

(III)

Prices (net of any discounts) for practice expense inputs, which may include paid invoice prices or other documentation or records.

(IV)

Overhead and accounting information for practices of physicians and other suppliers.

(V)

Any other element that would improve the valuation of services under this section.

(iv)

Information collection mechanisms

Information may be collected or obtained pursuant to this subparagraph from any or all of the following:

(I)

Surveys of physicians, other suppliers, providers of services, manufacturers, and vendors.

(II)

Surgical logs, billing systems, or other practice or facility records.

(III)

Electronic health records.

(IV)

Any other mechanism determined appropriate by the Secretary.

(v)

Transparency of use of information

(I)

In general

Subject to subclauses (II) and (III), if the Secretary uses information collected or obtained under this subparagraph in the determination of relative values under this subsection, the Secretary shall disclose the information source and discuss the use of such information in such determination of relative values through notice and comment rulemaking.

(II)

Thresholds for use

The Secretary may establish thresholds in order to use such information, including the exclusion of information collected or obtained from eligible professionals who use very high resources (as determined by the Secretary) in furnishing a service.

(III)

Disclosure of information

The Secretary shall make aggregate information available under this subparagraph but shall not disclose information in a form or manner that identifies an eligible professional or a group practice, or information collected or obtained pursuant to a nondisclosure agreement.

(vi)

Incentive to participate

The Secretary may provide for such payments under this part to an eligible professional that submits such solicited information under this subparagraph as the Secretary determines appropriate in order to compensate such eligible professional for such submission. Such payments shall be provided in a form and manner specified by the Secretary.

(vii)

Administration

Chapter 35 of title 44, United States Code, shall not apply to information collected or obtained under this subparagraph.

(viii)

Definition of eligible professional

In this subparagraph, the term eligible professional has the meaning given such term in subsection (k)(3)(B).

(ix)

Funding

For purposes of carrying out this subparagraph, in addition to funds otherwise appropriated, the Secretary shall provide for the transfer, from the Federal Supplementary Medical Insurance Trust Fund under section 1841, of $2,000,000 to the Centers for Medicare Medicaid Services Program Management Account for each fiscal year beginning with fiscal year 2014. Amounts transferred under the preceding sentence for a fiscal year shall be available until expended.

.

(2)

Limitation on review

Section 1848(i)(1) of the Social Security Act ( 42 U.S.C. 1395w–4(i)(1) ) is amended—

(A)

in subparagraph (D), by striking and at the end;

(B)

in subparagraph (E), by striking the period at the end and inserting , and; and

(C)

by adding at the end the following new subparagraph:

(F)

the collection and use of information in the determination of relative values under subsection (c)(2)(M).

.

(b)

Authority for alternative approaches To establishing practice expense relative values

Section 1848(c)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2) ), as amended by subsection (a), is amended by adding at the end the following new subparagraph:

(N)

Authority for alternative approaches to establishing practice expense relative values

The Secretary may establish or adjust practice expense relative values under this subsection using cost, charge, or other data from suppliers or providers of services, including information collected or obtained under subparagraph (M).

.

(c)

Revised and expanded identification of potentially misvalued codes

Section 1848(c)(2)(K)(ii) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(K)(ii) ) is amended to read as follows:

(ii)

Identification of potentially misvalued codes

For purposes of identifying potentially misvalued codes pursuant to clause (i)(I), the Secretary shall examine codes (and families of codes as appropriate) based on any or all of the following criteria:

(I)

Codes that have experienced the fastest growth.

(II)

Codes that have experienced substantial changes in practice expenses.

(III)

Codes that describe new technologies or services within an appropriate time period (such as 3 years) after the relative values are initially established for such codes.

(IV)

Codes which are multiple codes that are frequently billed in conjunction with furnishing a single service.

(V)

Codes with low relative values, particularly those that are often billed multiple times for a single treatment.

(VI)

Codes that have not been subject to review since implementation of the fee schedule.

(VII)

Codes that account for the majority of spending under the physician fee schedule.

(VIII)

Codes for services that have experienced a substantial change in the hospital length of stay or procedure time.

(IX)

Codes for which there may be a change in the typical site of service since the code was last valued.

(X)

Codes for which there is a significant difference in payment for the same service between different sites of service.

(XI)

Codes for which there may be anomalies in relative values within a family of codes.

(XII)

Codes for services where there may be efficiencies when a service is furnished at the same time as other services.

(XIII)

Codes with high intra-service work per unit of time.

(XIV)

Codes with high practice expense relative value units.

(XV)

Codes with high cost supplies.

(XVI)

Codes as determined appropriate by the Secretary.

.

(d)

Target for relative value adjustments for misvalued services

(1)

In general

Section 1848(c)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2) ), as amended by subsections (a) and (b), is amended by adding at the end the following new subparagraph:

(O)

Target for relative value adjustments for misvalued services

With respect to fee schedules established for each of 2015 through 2018, the following shall apply:

(i)

Determination of net reduction in expenditures

For each year, the Secretary shall determine the estimated net reduction in expenditures under the fee schedule under this section with respect to the year as a result of adjustments to the relative values established under this paragraph for misvalued codes.

(ii)

Budget neutral redistribution of funds if target met and counting overages towards the target for the succeeding year

If the estimated net reduction in expenditures determined under clause (i) for the year is equal to or greater than the target for the year—

(I)

reduced expenditures attributable to such adjustments shall be redistributed for the year in a budget neutral manner in accordance with subparagraph (B)(ii)(II); and

(II)

the amount by which such reduced expenditures exceeds the target for the year shall be treated as a reduction in expenditures described in clause (i) for the succeeding year, for purposes of determining whether the target has or has not been met under this subparagraph with respect to that year.

(iii)

Exemption from budget neutrality if target not met

If the estimated net reduction in expenditures determined under clause (i) for the year is less than the target for the year, reduced expenditures in an amount equal to the target recapture amount shall not be taken into account in applying subparagraph (B)(ii)(II) with respect to fee schedules beginning with 2015.

(iv)

Target recapture amount

For purposes of clause (iii), the target recapture amount is, with respect to a year, an amount equal to the difference between—

(I)

the target for the year; and

(II)

the estimated net reduction in expenditures determined under clause (i) for the year.

(v)

Target

For purposes of this subparagraph, with respect to a year, the target is calculated as 0.5 percent of the estimated amount of expenditures under the fee schedule under this section for the year.

.

(2)

Conforming amendment

Section 1848(c)(2)(B)(v) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(B)(v) ) is amended by adding at the end the following new subclause:

(VIII)

Reductions for misvalued services if target not met

Effective for fee schedules beginning with 2015, reduced expenditures attributable to the application of the target recapture amount described in subparagraph (O)(iii).

.

(e)

Phase-In of significant relative value unit (RVU) reductions

(1)

In general

Section 1848(c) of the Social Security Act ( 42 U.S.C. 1395w–4(c) ) is amended by adding at the end the following new paragraph:

(7)

Phase-in of significant relative value unit (RVU) reductions

Effective for fee schedules established beginning with 2015, if the total relative value units for a service for a year would otherwise be decreased by an estimated amount equal to or greater than 20 percent as compared to the total relative value units for the previous year, the applicable adjustments in work, practice expense, and malpractice relative value units shall be phased-in over a 2-year period.

.

(2)

Conforming amendments

Section 1848(c)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2) ) is amended—

(A)

in subparagraph (B)(ii)(I), by striking subclause (II) and inserting subclause (II) and paragraph (7); and

(B)

in subparagraph (K)(iii)(VI)—

(i)

by striking provisions of subparagraph (B)(ii)(II) and inserting provisions of subparagraph (B)(ii)(II) and paragraph (7); and

(ii)

by striking under subparagraph (B)(ii)(II) and inserting under subparagraph (B)(ii)(I).

(f)

Authority To smooth relative values within groups of services

Section 1848(c)(2)(C) of the Social Security Act ( 42 U.S.C. 1395w–4(c)(2)(C) ) is amended—

(1)

in each of clauses (i) and (iii), by striking the service and inserting the service or group of services each place it appears; and

(2)

in the first sentence of clause (ii), by inserting or group of services before the period.

(g)

GAO study and report on Relative Value Scale Update Committee

(1)

Study

The Comptroller General of the United States (in this subsection referred to as the Comptroller General) shall conduct a study of the processes used by the Relative Value Scale Update Committee (RUC) to provide recommendations to the Secretary of Health and Human Services regarding relative values for specific services under the Medicare physician fee schedule under section 1848 of the Social Security Act (42 U.S.C. 1395w–4).

(2)

Report

Not later than 1 year after the date of the enactment of this Act, the Comptroller General shall submit to Congress a report containing the results of the study conducted under paragraph (1).

(h)

Adjustment to Medicare payment localities

(1)

In general

Section 1848(e) of the Social Security Act ( 42 U.S.C. 1395w–4(e) ) is amended by adding at the end the following new paragraph:

(6)

Use of MSAs as fee schedule areas in California

(A)

In general

Subject to the succeeding provisions of this paragraph and notwithstanding the previous provisions of this subsection, for services furnished on or after January 1, 2017, the fee schedule areas used for payment under this section applicable to California shall be the following:

(i)

Each Metropolitan Statistical Area (each in this paragraph referred to as an MSA), as defined by the Director of the Office of Management and Budget as of December 31 of the previous year, shall be a fee schedule area.

(ii)

All areas not included in an MSA shall be treated as a single rest-of-State fee schedule area.

(B)

Transition for MSAs previously in rest-of-State payment locality or in locality 3

(i)

In general

For services furnished in California during a year beginning with 2017 and ending with 2021 in an MSA in a transition area (as defined in subparagraph (D)), subject to subparagraph (C), the geographic index values to be applied under this subsection for such year shall be equal to the sum of the following:

(I)

Current law component

The old weighting factor (described in clause (ii)) for such year multiplied by the geographic index values under this subsection for the fee schedule area that included such MSA that would have applied in such area (as estimated by the Secretary) if this paragraph did not apply.

(II)

MSA-based component

The MSA-based weighting factor (described in clause (iii)) for such year multiplied by the geographic index values computed for the fee schedule area under subparagraph (A) for the year (determined without regard to this subparagraph).

(ii)

Old weighting factor

The old weighting factor described in this clause—

(I)

for 2017, is 5/6; and

(II)

for each succeeding year, is the old weighting factor described in this clause for the previous year minus 1/6.

(iii)

MSA-based weighting factor

The MSA-based weighting factor described in this clause for a year is 1 minus the old weighting factor under clause (ii) for that year.

(C)

Hold harmless

For services furnished in a transition area in California during a year beginning with 2017, the geographic index values to be applied under this subsection for such year shall not be less than the corresponding geographic index values that would have applied in such transition area (as estimated by the Secretary) if this paragraph did not apply.

(D)

Transition area defined

In this paragraph, the term transition area means each of the following fee schedule areas for 2013:

(i)

The rest-of-State payment locality.

(ii)

Payment locality 3.

(E)

References to fee schedule areas

Effective for services furnished on or after January 1, 2017, for California, any reference in this section to a fee schedule area shall be deemed a reference to a fee schedule area established in accordance with this paragraph.

.

(2)

Conforming amendment to definition of fee schedule area

Section 1848(j)(2) of the Social Security Act ( 42 U.S.C. 1395w–4(j)(2) ) is amended by striking The term and inserting Except as provided in subsection (e)(6)(D), the term.

(i)

Disclosure of data used To establish multiple procedure payment reduction policy

The Secretary of Health and Human Services shall make publicly available the information used to establish the multiple procedure payment reduction policy to the professional component of imaging services in the final rule published in the Federal Register, v. 77, n. 222, November 16, 2012, pages 68891–69380 under the physician fee schedule under section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ).

6.

Promoting evidence-based care

(a)

In general

Section 1834 of the Social Security Act ( 42 U.S.C. 1395m ) is amended by adding at the end the following new subsection:

(p)

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. 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 for an individual.

(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 for an individual.

(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 criteria applies with respect to an applicable imaging service, the Secretary shall permit 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 are more than one applicable appropriate use criteria 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)

Alternative payment models

An applicable imaging service ordered by an ordering professional with respect to an individual attributed to an alternative payment model (as defined in section 1833(z)(3)(C)).

(iv)

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.

.

(b)

Conforming amendment

Section 1833(t)(16) of the Social Security Act ( 42 U.S.C. 1395l(t)(16) ) is amended by adding at the end the following new subparagraph:

(E)

Application of appropriate use criteria for certain imaging services

For provisions relating to the application of appropriate use criteria for certain imaging services, see section 1834(p).

.

(c)

Report on experience of imaging appropriate use criteria program

Not later than 18 months after the date of the enactment of this Act, the Comptroller General of the United States shall submit to Congress a report that includes a description of the extent to which appropriate use criteria could be used for other services under part B of title XVIII of the Social Security Act ( 42 U.S.C. 1395j et seq.), such as radiation therapy and clinical diagnostic laboratory services.

7.

Empowering beneficiary choices through access to information on physicians’ services

(a)

In general

The Secretary shall make publicly available on Physician Compare the information described in subsection (b) with respect to eligible professionals.

(b)

Information described

The following information, with respect to an eligible professional, is described in this subsection:

(1)

Information on the number of services furnished by the eligible professional under part B of title XVIII of the Social Security Act ( 42 U.S.C. 1395j et seq.), which may include information on the most frequent services furnished or groupings of services.

(2)

Information on submitted charges and payments for services under such part.

(3)

A unique identifier for the eligible professional that is available to the public, such as a national provider identifier.

(c)

Searchability

The information made available under this section shall be searchable by at least the following:

(1)

The specialty or type of the eligible professional.

(2)

Characteristics of the services furnished, such as volume or groupings of services.

(3)

The location of the eligible professional.

(d)

Disclosure

The information made available under this section shall indicate, where appropriate, that publicized information may not be representative of the eligible professional’s entire patient population, the variety of services furnished by the eligible professional, or the health conditions of individuals treated.

(e)

Implementation

(1)

Initial implementation

Physician Compare shall include the information described in subsection (b)—

(A)

with respect to physicians, by not later than July 1, 2015; and

(B)

with respect to other eligible professionals, by not later than July 1, 2016.

(2)

Annual updating

The information made available under this section shall be updated on Physician Compare not less frequently than on an annual basis.

(f)

Opportunity To review and submit corrections

The Secretary shall provide for an opportunity for an eligible professional to review, and submit corrections for, the information to be made public with respect to the eligible professional under this section prior to such information being made public.

(g)

Definitions

In this section:

(1)

Eligible professional; physician; secretary

The terms eligible professional, physician, and Secretary have the meaning given such terms in section 10331(i) of Public Law 111–148 .

(2)

Physician Compare

The term Physician Compare means the Physician Compare Internet website of the Centers for Medicare Medicaid Services (or a successor website).

8.

Expanding availability of Medicare data

(a)

Expanding uses of Medicare data by qualified entities

(1)

Additional analyses

(A)

In general

Subject to subparagraph (B), to the extent consistent with applicable information, privacy, security, and disclosure laws (including paragraph (3)), notwithstanding paragraph (4)(B) of section 1874(e) of the Social Security Act (42 U.S.C. 1395kk(e)) and the second sentence of paragraph (4)(D) of such section, beginning July 1, 2015, a qualified entity may use the combined data described in paragraph (4)(B)(iii) of such section received by such entity under such section, and information derived from the evaluation described in such paragraph (4)(D), to conduct additional non-public analyses (as determined appropriate by the Secretary) and provide or sell such analyses to authorized users for non-public use (including for the purposes of assisting providers of services and suppliers to develop and participate in quality and patient care improvement activities, including developing new models of care).

(B)

Limitations with respect to analyses

(i)

Employers

Any analyses provided or sold under subparagraph (A) to an employer described in paragraph (9)(A)(iii) may only be used by such employer for purposes of providing health insurance to employees and retirees of the employer.

(ii)

Health insurance issuers

A qualified entity may not provide or sell an analysis to a health insurance issuer described in paragraph (9)(A)(iv) unless the issuer is providing the qualified entity with data under section 1874(e)(4)(B)(iii) of the Social Security Act (42 U.S.C. 1395kk(e)(4)(B)(iii)).

(2)

Access to certain data

(A)

Access

To the extent consistent with applicable information, privacy, security, and disclosure laws (including paragraph (3)), notwithstanding paragraph (4)(B) of section 1874(e) of the Social Security Act ( 42 U.S.C. 1395kk(e) ) and the second sentence of paragraph (4)(D) of such section, beginning July 1, 2015, a qualified entity may—

(i)

provide or sell the combined data described in paragraph (4)(B)(iii) of such section to authorized users described in clauses (i), (ii), and (v) of paragraph (9)(A) for non-public use, including for the purposes described in subparagraph (B); or

(ii)

subject to subparagraph (C), provide Medicare claims data to authorized users described in clauses (i), (ii), and (v), of paragraph (9)(A) for non-public use, including for the purposes described in subparagraph (B).

(B)

Purposes described

The purposes described in this subparagraph are assisting providers of services and suppliers in developing and participating in quality and patient care improvement activities, including developing new models of care.

(C)

Medicare claims data must be provided at no cost

A qualified entity may not charge a fee for providing the data under subparagraph (A)(ii).

(3)

Protection of information

(A)

In general

Except as provided in subparagraph (B), an analysis or data that is provided or sold under paragraph (1) or (2) shall not contain information that individually identifies a patient.

(B)

Information on patients of the provider of services or supplier

To the extent consistent with applicable information, privacy, security, and disclosure laws, an analysis or data that is provided or sold to a provider of services or supplier under paragraph (1) or (2) may contain information that individually identifies a patient of such provider or supplier, including with respect to items and services furnished to the patient by other providers of services or suppliers.

(C)

Prohibition on using analyses or data for marketing purposes

An authorized user shall not use an analysis or data provided or sold under paragraph (1) or (2) for marketing purposes.

(4)

Data use agreement

A qualified entity and an authorized user described in clauses (i), (ii), and (v) of paragraph (9)(A) shall enter into an agreement regarding the use of any data that the qualified entity is providing or selling to the authorized user under paragraph (2). Such agreement shall describe the requirements for privacy and security of the data and, as determined appropriate by the Secretary, any prohibitions on using such data to link to other individually identifiable sources of information. If the authorized user is not a covered entity under the rules promulgated pursuant to the Health Insurance Portability and Accountability Act of 1996, the agreement shall identify the relevant regulations, as determined by the Secretary, that the user shall comply with as if it were acting in the capacity of such a covered entity.

(5)

No redisclosure of analyses or data

(A)

In general

Except as provided in subparagraph (B), an authorized user that is provided or sold an analysis or data under paragraph (1) or (2) shall not redisclose or make public such analysis or data or any analysis using such data.

(B)

Permitted redisclosure

A provider of services or supplier that is provided or sold an analysis or data under paragraph (1) or (2) may, as determined by the Secretary, redisclose such analysis or data for the purposes of performance improvement and care coordination activities but shall not make public such analysis or data or any analysis using such data.

(6)

Opportunity for providers of services and suppliers to review

Prior to a qualified entity providing or selling an analysis to an authorized user under paragraph (1), to the extent that such analysis would individually identify a provider of services or supplier who is not being provided or sold such analysis, such qualified entity shall provide such provider or supplier with the opportunity to appeal and correct errors in the manner described in section 1874(e)(4)(C)(ii) of the Social Security Act (42 U.S.C. 1395kk(e)(4)(C)(ii)).

(7)

Assessment for a breach

(A)

In general

In the case of a breach of a data use agreement under this section or section 1874(e) of the Social Security Act ( 42 U.S.C. 1395kk(e) ), the Secretary shall impose an assessment on the qualified entity both in the case of—

(i)

an agreement between the Secretary and a qualified entity; and

(ii)

an agreement between a qualified entity and an authorized user.

(B)

Assessment

The assessment under subparagraph (A) shall be an amount up to $100 for each individual entitled to, or enrolled for, benefits under part A of title XVIII of the Social Security Act or enrolled for benefits under part B of such title—

(i)

in the case of an agreement described in subparagraph (A)(i), for whom the Secretary provided data on to the qualified entity under paragraph (2); and

(ii)

in the case of an agreement described in subparagraph (A)(ii), for whom the qualified entity provided data on to the authorized user under paragraph (2).

(C)

Deposit of amounts collected

Any amounts collected pursuant to this paragraph shall be deposited in Federal Supplementary Medical Insurance Trust Fund under section 1841 of the Social Security Act ( 42 U.S.C. 1395t ).

(8)

Annual reports

Any qualified entity that provides or sells an analysis or data under paragraph (1) or (2) shall annually submit to the Secretary a report that includes—

(A)

a summary of the analyses provided or sold, including the number of such analyses, the number of purchasers of such analyses, and the total amount of fees received for such analyses;

(B)

a description of the topics and purposes of such analyses;

(C)

information on the entities who received the data under paragraph (2), the uses of the data, and the total amount of fees received for providing, selling, or sharing the data; and

(D)

other information determined appropriate by the Secretary.

(9)

Definitions

In this subsection and subsection (b):

(A)

Authorized user

The term authorized user means the following:

(i)

A provider of services.

(ii)

A supplier.

(iii)

An employer (as defined in section 3(5) of the Employee Retirement Insurance Security Act of 1974).

(iv)

A health insurance issuer (as defined in section 2791 of the Public Health Service Act).

(v)

A medical society or hospital association.

(vi)

Any entity not described in clauses (i) through (v) that is approved by the Secretary (other than an employer or health insurance issuer not described in clauses (iii) and (iv), respectively, as determined by the Secretary).

(B)

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)).

(C)

Qualified entity

The term qualified entity has the meaning given such term in section 1874(e)(2) of the Social Security Act (42 U.S.C. 1395kk(e)).

(D)

Secretary

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

(E)

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)).

(b)

Access to Medicare data by qualified clinical data registries To facilitate quality improvement

(1)

Access

(A)

In general

To the extent consistent with applicable information, privacy, security, and disclosure laws, beginning July 1, 2015, the Secretary shall, at the request of a qualified clinical data registry under section 1848(m)(3)(E) of the Social Security Act ( 42 U.S.C. 1395w–4(m)(3)(E) ), provide the data described in subparagraph (B) (in a form and manner determined to be appropriate) to such qualified clinical data registry for purposes of linking such data with clinical outcomes data and performing risk-adjusted, scientifically valid analyses and research to support quality improvement or patient safety, provided that any public reporting of such analyses or research that identifies a provider of services or supplier shall only be conducted with the opportunity of such provider or supplier to appeal and correct errors in the manner described in subsection (a)(6).

(B)

Data described

The data described in this subparagraph is—

(i)

claims data under the Medicare program under title XVIII of the Social Security Act; and

(ii)

if the Secretary determines appropriate, claims data under the Medicaid program under title XIX of such Act and the State Children's Health Insurance Program under title XXI of such Act.

(2)

Fee

Data described in paragraph (1)(B) shall be provided to a qualified clinical data registry under paragraph (1) at a fee equal to the cost of providing such data. Any fee collected pursuant to the preceding sentence shall be deposited in the Centers for Medicare Medicaid Services Program Management Account.

(c)

Expansion of data available to qualified entities

Section 1874(e) of the Social Security Act ( 42 U.S.C. 1395kk(e) ) is amended—

(1)

in the subsection heading, by striking Medicare ; and

(2)

in paragraph (3)—

(A)

by inserting after the first sentence the following new sentence: Beginning July 1, 2015, if the Secretary determines appropriate, the data described in this paragraph may also include standardized extracts (as determined by the Secretary) of claims data under titles XIX and XXI for assistance provided under such titles for one or more specified geographic areas and time periods requested by a qualified entity.; and

(B)

in the last sentence, by inserting or under titles XIX or XXI before the period at the end.

(d)

Revision of placement of fees

Section 1874(e)(4)(A) of the Social Security Act ( 42 U.S.C. 1395kk(e)(4)(A) ) is amended, in the second sentence—

(1)

by inserting , for periods prior to July 1, 2015, after deposited; and

(2)

by inserting the following before the period at the end: , and, beginning July 1, 2015, into the Centers for Medicare Medicaid Services Program Management Account.

9.

Reducing administrative burden and other provisions

(a)

Medicare physician and practitioner opt-Out to private contract

(1)

Indefinite, continuing automatic extension of opt out election

(A)

In general

Section 1802(b)(3) of the Social Security Act ( 42 U.S.C. 1395a(b)(3) ) is amended—

(i)

in subparagraph (B)(ii), by striking during the 2-year period beginning on the date the affidavit is signed and inserting during the applicable 2-year period (as defined in subparagraph (D));

(ii)

in subparagraph (C), by striking during the 2-year period described in subparagraph (B)(ii) and inserting during the applicable 2-year period; and

(iii)

by adding at the end the following new subparagraph:

(D)

Applicable 2-year periods for effectiveness of affidavits

In this subsection, the term applicable 2-year period means, with respect to an affidavit of a physician or practitioner under subparagraph (B), the 2-year period beginning on the date the affidavit is signed and includes each subsequent 2-year period unless the physician or practitioner involved provides notice to the Secretary (in a form and manner specified by the Secretary), not later than 30 days before the end of the previous 2-year period, that the physician or practitioner does not want to extend the application of the affidavit for such subsequent 2-year period.

.

(B)

Effective date

The amendments made by subparagraph (A) shall apply to affidavits entered into on or after the date that is 60 days after the date of the enactment of this Act.

(2)

Public availability of information on opt-out physicians and practitioners

Section 1802(b) of the Social Security Act ( 42 U.S.C. 1395a(b) ) is amended—

(A)

in paragraph (5), by adding at the end the following new subparagraph:

(D)

Opt-out physician or practitioner

The term opt-out physician or practitioner means a physician or practitioner who has in effect an affidavit under paragraph (3)(B).

;

(B)

by redesignating paragraph (5) as paragraph (6); and

(C)

by inserting after paragraph (4) the following new paragraph:

(5)

Posting of information on opt-out physicians and practitioners

(A)

In general

Beginning not later than February 1, 2015, the Secretary shall make publicly available through an appropriate publicly accessible website of the Department of Health and Human Services information on the number and characteristics of opt-out physicians and practitioners and shall update such information on such website not less often than annually.

(B)

Information to be included

The information to be made available under subparagraph (A) shall include at least the following with respect to opt-out physicians and practitioners:

(i)

Their number.

(ii)

Their physician or professional specialty or other designation.

(iii)

Their geographic distribution.

(iv)

The timing of their becoming opt-out physicians and practitioners, relative to when they first entered practice and with respect to applicable 2-year periods.

(v)

The proportion of such physicians and practitioners who billed for emergency or urgent care services.

.

(b)

Gainsharing study and report

Not later than 6 months after the date of the enactment of this Act, the Secretary of Health and Human Services, in consultation with the Inspector General of the Department of Health and Human Services, shall submit to Congress a report with legislative recommendations to amend existing fraud and abuse laws, through exceptions, safe harbors, or other narrowly targeted provisions, to permit gainsharing or similar arrangements between physicians and hospitals that improve care while reducing waste and increasing efficiency. The report shall—

(1)

consider whether such provisions should apply to ownership interests, compensation arrangements, or other relationships;

(2)

describe how the recommendations address accountability, transparency, and quality, including how best to limit inducements to stint on care, discharge patients prematurely, or otherwise reduce or limit medically necessary care; and

(3)

consider whether a portion of any savings generated by such arrangements should accrue to the Medicare program under title XVIII of the Social Security Act.

(c)

Promoting interoperability of electronic health record systems

(1)

Recommendations for achieving widespread EHR interoperability

(A)

Objective

As a consequence of a significant Federal investment in the implementation of health information technology through the Medicare and Medicaid EHR incentive programs, Congress declares it a national objective to achieve widespread exchange of health information through interoperable certified EHR technology nationwide by December 31, 2017.

(B)

Definitions

In this paragraph:

(i)

Widespread interoperability

The term widespread interoperability means interoperability between certified EHR technology systems employed by meaningful EHR users under the Medicare and Medicaid EHR incentive programs and other clinicians and health care providers on a nationwide basis.

(ii)

Interoperability

The term interoperability means the ability of two or more health information systems or components to exchange clinical and other information and to use the information that has been exchanged using common standards as to provide access to longitudinal information for health care providers in order to facilitate coordinated care and improved patient outcomes.

(C)

Establishment of metrics

Not later than July 1, 2015, and in consultation with stakeholders, the Secretary shall establish metrics to be used to determine if and to the extent that the objective described in subparagraph (A) has been achieved.

(D)

Recommendations if objective not achieved

If the Secretary of Health and Human Services determines that the objective described in subparagraph (A) has not been achieved by December 31, 2017, then the Secretary shall submit to Congress a report, by not later than December 31, 2018, that identifies barriers to such objective and recommends actions that the Federal Government can take to achieve such objective. Such recommended actions may include recommendations—

(i)

to adjust payments for not being meaningful EHR users under the Medicare EHR incentive programs; and

(ii)

for criteria for decertifying certified EHR technology products.

(2)

Preventing blocking the sharing of information

(A)

For meaningful EHR professionals

Section 1848(o)(2)(A)(ii) of the Social Security Act ( 42 U.S.C. 1395w–4(o)(2)(A)(ii) ) is amended by inserting before the period at the end the following: , and the professional demonstrates (through a process specified by the Secretary, such as the use of an attestation) that the professional has not knowingly and willfully taken any action to limit or restrict the compatibility or interoperability of the certified EHR technology.

(B)

For meaningful EHR hospitals

Section 1886(n)(3)(A)(ii) of the Social Security Act ( 42 U.S.C. 1395ww(n)(3)(A)(ii) ) is amended by inserting before the period at the end the following: , and the hospital demonstrates (through a process specified by the Secretary, such as the use of an attestation) that the hospital has not knowingly and willfully taken any action to limit or restrict the compatibility or interoperability of the certified EHR technology.

(C)

Effective date

The amendments made by this subsection shall apply to meaningful EHR users as of the date that is one year after the date of the enactment of this Act.

(3)

Study and report on the feasibility of establishing a website to compare certified EHR technology products

(A)

Study

The Secretary shall conduct a study to examine the feasibility of establishing mechanisms that includes aggregated results of surveys of meaningful EHR users on the functionality of certified EHR technology products to enable such users to directly compare the functionality and other features of such products. Such information may be made available through contracts with physician, hospital, or other organizations that maintain such comparative information.

(B)

Report

Not later than 1 year after the date of the enactment of this Act, the Secretary shall submit to Congress a report on the website. The report shall include information on the benefits of, and resources needed to develop and maintain, such a website.

(4)

Definitions

In this subsection:

(A)

The term certified EHR technology has the meaning given such term in section 1848(o)(4) of the Social Security Act (42 U.S.C. 1395w–4(o)(4)).

(B)

The term meaningful EHR user has the meaning given such term under the Medicare EHR incentive programs.

(C)

The term Medicare and Medicaid EHR incentive programs means—

(i)

in the case of the Medicare program under title XVIII of the Social Security Act, the incentive programs under section 1814(l)(3), section 1848(o), subsections (l) and (m) of section 1853, and section 1886(n) of the Social Security Act (42 U.S.C. 1395f(l)(3), 1395w–4(o), 1395w–23, 1395ww(n)); and

(ii)

in the case of the Medicaid program under title XIX of such Act, the incentive program under subsections (a)(3)(F) and (t) of section 1903 of such Act (42 U.S.C. 1396b).

(D)

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

(d)

GAO studies and reports on the use of telehealth under Federal programs and on remote patient monitoring services

(1)

Study on telehealth services

The Comptroller General of the United States shall conduct a study on the following:

(A)

How the definition of telehealth across various Federal programs and Federal efforts can inform the use of telehealth in the Medicare program under title XVIII of the Social Security Act ( 42 U.S.C. 1395 et seq.).

(B)

Issues that can facilitate or inhibit the use of telehealth under the Medicare program under such title, including oversight and professional licensure, changing technology, privacy and security, infrastructure requirements, and varying needs across urban and rural areas.

(C)

Potential implications of greater use of telehealth with respect to payment and delivery system transformations under the Medicare program under such title XVIII and the Medicaid program under title XIX of such Act ( 42 U.S.C. 1396 et seq.).

(D)

How the Centers for Medicare Medicaid Services conducts oversight of payments made under the Medicare program under such title XVIII to providers for telehealth services.

(2)

Study on remote patient monitoring services

(A)

In general

The Comptroller General of the United States shall conduct a study—

(i)

of the dissemination of remote patient monitoring technology in the private health insurance market;

(ii)

of the financial incentives in the private health insurance market relating to adoption of such technology;

(iii)

of the barriers to adoption of such services under the Medicare program under title XVIII of the Social Security Act;

(iv)

that evaluates the patients, conditions, and clinical circumstances that could most benefit from remote patient monitoring services; and

(v)

that evaluates the challenges related to establishing appropriate valuation for remote patient monitoring services under the Medicare physician fee schedule under section 1848 of the Social Security Act ( 42 U.S.C. 1395w–4 ) in order to accurately reflect the resources involved in furnishing such services.

(B)

Definitions

For purposes of this paragraph:

(i)

Remote patient monitoring services

The term remote patient monitoring services means services furnished through remote patient monitoring technology.

(ii)

Remote patient monitoring technology

The term remote patient monitoring technology means a coordinated system that uses one or more home-based or mobile monitoring devices that automatically transmit vital sign data or information on activities of daily living and may include responses to assessment questions collected on the devices wirelessly or through a telecommunications connection to a server that complies with the Federal regulations (concerning the privacy of individually identifiable health information) promulgated under section 264(c) of the Health Insurance Portability and Accountability Act of 1996, as part of an established plan of care for that patient that includes the review and interpretation of that data by a health care professional.

(3)

Reports

Not later than 24 months after the date of the enactment of this Act, the Comptroller General shall submit to Congress

(A)

a report containing the results of the study conducted under paragraph (1); and

(B)

a report containing the results of the study conducted under paragraph (2).

A report required under this paragraph shall be submitted together with recommendations for such legislation and administrative action as the Comptroller General determines appropriate. The Comptroller General may submit one report containing the results described in subparagraphs (A) and (B) and the recommendations described in the previous sentence.
(e)

Rule of construction regarding healthcare provider standards of care

(1)

Maintenance of state standards

The development, recognition, or implementation of any guideline or other standard under any Federal health care provision shall not be construed—

(A)

to establish the standard of care or duty of care owed by a health care provider to a patient in any medical malpractice or medical product liability action or claim; or

(B)

to preempt any standard of care or duty of care, owed by a health care provider to a patient, duly established under State or common law.

(2)

Definitions

For purposes of this subsection:

(A)

Federal health care provision

The term Federal health care provision means any provision of the Patient Protection and Affordable Care Act ( Public Law 111–148 ), title I or subtitle B of title II of the Health Care and Education Reconciliation Act of 2010 ( Public Law 111–152 ), or title XVIII or XIX of the Social Security Act.

(B)

Health care provider

The term health care provider means any individual or entity—

(i)

licensed, registered, or certified under Federal or State laws or regulations to provide health care services; or

(ii)

required to be so licensed, registered, or certified but that is exempted by other statute or regulation.

(C)

Medical malpractice or medical product liability action or claim

The term medical malpractice or medical product liability action or claim means a medical malpractice action or claim (as defined in section 431(7) of the Health Care Quality Improvement Act of 1986 ( 42 U.S.C. 11151(7) )) and includes a liability action or claim relating to a health care provider’s prescription or provision of a drug, device, or biological product (as such terms are defined in section 201 of the Federal Food, Drug, and Cosmetic Act or section 351 of the Public Health Service Act).

(D)

State

The term State includes the District of Columbia, Puerto Rico, and any other commonwealth, possession, or territory of the United States.

(3)

Preservation of State law

No provision of the Patient Protection and Affordable Care Act ( Public Law 111–148 ), title I or subtitle B of title II of the Health Care and Education Reconciliation Act of 2010 ( Public Law 111–152 ), or title XVIII or XIX of the Social Security Act shall be construed to preempt any State or common law governing medical professional or medical product liability actions or claims.

10.

Savings from overseas contingency and related activities

(a)

In general

Section 251 of the Balanced Budget and Emergency Deficit Control Act of 1985 ( 2 U.S.C. 901 ) is amended—

(1)

in subsection (b)(2)(A)(ii), by inserting for fiscal years 2012 through 2015, before the Congress; and

(2)

by adding at the end the following:

(E)

Overseas contingency operations/global war on terrorism

If, for fiscal years 2016 through 2021, appropriations for discretionary accounts are enacted that Congress designates for Overseas Contingency Operations/Global War on Terrorism in statute on an account by account basis and the President subsequently so designates, the adjustment for the fiscal year shall be the total of such appropriations for the fiscal year in discretionary accounts designated as being for Overseas Contingency Operations/Global War on Terrorism, but not to exceed—

(i)

For fiscal year 2016, $29,946,000,000 in budget authority.

(ii)

For fiscal year 2017, $29,946,000,000 in budget authority.

(iii)

For fiscal year 2018, $29,946,000,000 in budget authority.

(iv)

For fiscal year 2019, $29,946,000,000 in budget authority.

(v)

For fiscal year 2020, $29,946,000,000 in budget authority.

(vi)

For fiscal year 2021, $29,946,000,000 in budget authority.

.

(b)

Breach

Section 251(a)(2) of such Act ( 2 U.S.C. 901(a)(2) ) is amended to read as follows:

(2)

Eliminating a breach

(A)

In general

Each non-exempt account within a category shall be reduced by a dollar amount calculated by multiplying the enacted level of sequestrable budgetary resources in that account by the uniform percentage necessary to eliminate a breach within that category.

(B)

Overseas contingencies

Any amount of budget authority for Overseas Contingency Operations/Global War on Terrorism for fiscal years 2016 through 2021 in excess of the levels set in subsection 251(b)(2)(E) shall be counted in determining whether a breach has occurred in the security category and the nonsecurity category on a proportional basis to the total spending for overseas contingency operations in the security category and the nonsecurity category.

.