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S. 861 (114th): PRIME Act of 2015

The text of the bill below is as of Mar 25, 2015 (Introduced).


II

114th CONGRESS

1st Session

S. 861

IN THE SENATE OF THE UNITED STATES

March 25, 2015

(for himself, Mr. Enzi, Mr. Whitehouse, Mr. Johnson, Mr. Coons, Mr. Portman, Ms. Klobuchar, Mr. Cotton, Mrs. McCaskill, Mr. Barrasso, Mr. Manchin, Ms. Ayotte, Mr. Thune, and Mrs. Shaheen) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend titles XVIII and XIX of the Social Security Act to curb waste, fraud, and abuse in the Medicare and Medicaid programs.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Preventing and Reducing Improper Medicare and Medicaid Expenditures Act of 2015 or the PRIME Act of 2015 .

(b)

Table of contents

The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

TITLE I—Curbing improper payments

Sec. 101. Requiring valid prescriber National Provider Identifiers on pharmacy claims.

Sec. 102. Reforming how CMS tracks and corrects the vulnerabilities identified by Recovery Audit Contractors.

Sec. 103. Improving Senior Medicare Patrol and fraud reporting rewards.

Sec. 104. Strengthening Medicaid Program integrity through flexibility.

Sec. 105. Establishing Medicare administrative contractor error reduction incentives.

Sec. 106. Strengthening penalties for the illegal distribution of a Medicare, Medicaid, or CHIP beneficiary identification or billing privileges.

TITLE II—Improving data sharing

Sec. 201. Access to the National Directory of New Hires.

Sec. 202. Improving the sharing of data between the Federal Government and State Medicaid programs.

Sec. 203. Improving claims processing and detection of fraud within the Medicaid and CHIP programs.

TITLE III—Report on implementation

Sec. 301. Report on implementation.

I

Curbing improper payments

101.

Requiring valid prescriber National Provider Identifiers on pharmacy claims

Section 1860D–4(c) of the Social Security Act (42 U.S.C. 1395w–104(c)) is amended by adding at the end the following new paragraph:

(4)

Requiring valid prescriber National Provider Identifiers on pharmacy claims

(A)

In general

For plan year 2016 and subsequent plan years, subject to subparagraph (B), the Secretary shall prohibit PDP sponsors of prescription drug plans from paying claims for prescription drugs under this part that do not include a valid prescriber National Provider Identifier.

(B)

Procedures

The Secretary shall establish—

(i)

procedures for determining the validity of prescriber National Provider Identifiers under subparagraph (A); and

(ii)

procedures for transferring to the Inspector General of the Department of Health and Human Services and appropriate law enforcement agencies and other oversight entities information on those National Provider Identifiers and pharmacy claims, including records related to such claims, that the Secretary determines are invalid under clause (i).

(C)

Report

Not later than January 1, 2018, the Inspector General of the Department of Health and Human Services shall submit to Congress a report on the effectiveness of the procedures established under subparagraph (B).

.

102.

Reforming how CMS tracks and corrects the vulnerabilities identified by Recovery Audit Contractors

(a)

In general

Section 1893(h) of the Social Security Act (42 U.S.C. 1395ddd(h)) is amended—

(1)

in paragraph (8)—

(A)

by striking report.—The Secretary and inserting “report.—

(A)

In general

Subject to subparagraph (C), the Secretary

; and

(B)

by adding after subparagraph (A), as inserted by subparagraph (A), the following new subparagraphs:

(B)

Inclusion of improper payment vulnerabilities identified

Each report submitted under subparagraph (A) shall, subject to subparagraph (C), include—

(i)

a description of—

(I)

the types and financial cost to the program under this title of improper payment vulnerabilities identified by recovery audit contractors under this subsection; and

(II)

how the Secretary is addressing such improper payment vulnerabilities; and

(ii)

an assessment of the effectiveness of changes made to payment policies and procedures under this title in order to address the vulnerabilities so identified.

(C)

Limitation

The Secretary shall ensure that each report submitted under subparagraph (A) does not include information that the Secretary determines would be sensitive or would otherwise negatively impact program integrity.

; and

(2)

by adding at the end the following new paragraph:

(10)

Addressing improper payment vulnerabilities

The Secretary shall address improper payment vulnerabilities identified by recovery audit contractors under this subsection in a timely manner, prioritized based on the risk to the program under this title.

.

(b)

Use of Medicare and Medicaid recovery audit contractor recoveries for provider education and To prevent improper payments and fraud

(1)

Medicare RAC program

Section 1893(h)(1)(C) of the Social Security Act (42 U.S.C. 1395ddd(h)(1)(C)) is amended—

(A)

by striking the Secretary shall retain and inserting “the Secretary—

(i)

shall retain

;

(B)

in clause (i), as added by subparagraph (A)—

(i)

by inserting , in addition to any other funds that may be available, after available;

(ii)

by inserting until expended after Services; and

(iii)

by striking the period at the end and inserting a semicolon; and

(C)

by adding at the end the following new clauses:

(ii)

may retain an additional portion of the amounts recovered (not to exceed 25 percent of such amounts recovered) which shall be available, in addition to any other funds that may be available, to such program management account until expended for purposes of activities to address problems that contribute to improper payments and fraud under this title; and

(iii)

shall retain an additional 5 percent of such amounts recovered to be made available, in addition to any other funds that may be available, to the Inspector General of the Department of Health and Human Services until expended for the Inspector General to carry out activities of the Inspector General relating to investigating improper payments or auditing internal controls associated with payments under this title.

.

(2)

Medicaid RAC program

Section 1936 of the Social Security Act (42 U.S.C. 1396u–6) is amended by adding at the end the following new subsection:

(f)

Amounts recovered through recovery audit contractors

Notwithstanding any other provision of law, the Secretary—

(1)

may retain a portion of the amounts recovered pursuant to the program established under section 1902(a)(42)(B) (not to exceed 25 percent of the Federal share of such amounts recovered) which shall be available, in addition to any other funds that may be available, to the program management account of the Centers for Medicare & Medicaid Services for purposes of activities to address problems that contribute to improper payments and fraud under this title; and

(2)

shall retain an additional 5 percent of the Federal share of such amounts recovered to be made available, in addition to any other funds that may be available, to the Inspector General of the Department of Health and Human Services until expended for the Inspector General to carry out activities of the Inspector General relating to investigating improper payments or auditing internal controls associated with payments under this title.

.

(3)

Effective date

The amendments made by this section shall take effect on the date that is 1 year after the date of enactment of this Act.

103.

Improving Senior Medicare Patrol and fraud reporting rewards

(a)

In general

The Secretary of Health and Human Services (in this section referred to as the Secretary) shall develop a plan to revise the incentive program under section 203(b) of the Health Insurance Portability and Accountability Act of 1996 (42 U.S.C. 1395b–5(b)) to encourage greater participation by individuals to report fraud and abuse in the Medicare program. Such plan shall include recommendations for—

(1)

ways to enhance rewards for individuals reporting under the incentive program, including rewards based on information that leads to an administrative action; and

(2)

extending the incentive program to the Medicaid program.

(b)

Public awareness and education campaign

The plan developed under subsection (a) shall also include recommendations for the use of the Senior Medicare Patrols authorized under section 411 of the Older Americans Act of 1965 (42 U.S.C. 3032) to conduct a public awareness and education campaign to encourage participation in the revised incentive program under subsection (a).

(c)

Submission of plan

Not later than 180 days after the date of enactment of this Act, the Secretary shall submit to Congress the plan developed under subsection (a).

104.

Strengthening Medicaid Program integrity through flexibility

Section 1936 of the Social Security Act (42 U.S.C. 1396u–6) is amended—

(1)

in subsection (a), by inserting , or otherwise, after entities; and

(2)

in subsection (e)—

(A)

in paragraph (1), in the matter preceding subparagraph (A), by inserting (including the costs of equipment, salaries and benefits, and travel and training) after Program under this section; and

(B)

in paragraph (3), by striking by 100 and inserting by 100, or such number as determined necessary by the Secretary to carry out the Program,.

105.

Establishing Medicare administrative contractor error reduction incentives

(a)

In general

Section 1874A(b)(1)(D) of the Social Security Act (42 U.S.C. 1395kk–1(b)(1)(D)) is amended—

(1)

by striking quality.—The Secretary and inserting “quality.—

(i)

In general

Subject to clauses (ii) and (iii), the Secretary

; and

(2)

by inserting after clause (i), as added by paragraph (1), the following new clauses:

(ii)

Improper payment error rate reduction incentives

The Secretary shall provide incentives for medicare administrative contractors to reduce the improper payment error rates in their jurisdictions.

(iii)

Incentives

The incentives provided for under clause (ii)—

(I)

may include a sliding scale of bonus payments and additional incentives to medicare administrative contractors that reduce the improper payment error rates in their jurisdictions to certain benchmark levels, as determined by the Secretary; and

(II)

shall include substantial reductions in award fee payments under award fee contracts, for any medicare administrative contractor that reaches an upper end error threshold or other threshold as determined by the Secretary.

.

(b)

Effective date

(1)

In general

The amendments made by subsection (a) shall apply to contracts entered into or renewed on or after the date that is 12 months after the date of enactment of this Act.

(2)

Contracts entered into or renewed prior to effective date

In the case of contracts in existence on or after the date of the enactment of this Act and that are not subject to the effective date under paragraph (1), the Secretary of Health and Human Services shall, when appropriate and practicable, seek to apply the incentives provided for in the amendments made by subsection (a) through contract modifications.

106.

Strengthening penalties for the illegal distribution of a Medicare, Medicaid, or CHIP beneficiary identification or billing privileges

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

(4)

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

.

II

Improving data sharing

201.

Access to the National Directory of New Hires

Section 453(j) of the Social Security Act (42 U.S.C. 653(j)) is amended by adding at the end of the following new paragraph:

(12)

Information comparisons and disclosures to assist in administration of the Medicare program and State health subsidy programs

(A)

Disclosure to the Administrator of the Centers for Medicare & Medicaid Services

The Administrator of the Centers for Medicare & Medicaid Services shall have access to the information in the National Directory of New Hires for purposes of determining the eligibility of an applicant for, or enrollee in, the Medicare program under title XVIII or an applicable State health subsidy program (as defined in section 1413(e) of the Patient Protection and Affordable Care Act (42 U.S.C. 18083(e))).

(B)

Disclosure to the Inspector General of the Department of Health and Human Services

(i)

In general

If the Inspector General of the Department of Health and Human Services transmits to the Secretary the names and social security account numbers of individuals, the Secretary shall disclose to the Inspector General information on such individuals and their employers maintained in the National Directory of New Hires.

(ii)

Use of information

The Inspector General of the Department of Health and Human Services may use information provided under clause (i) only for purposes of—

(I)

determining the eligibility of an applicant for, or enrollee in, the Medicare program under title XVIII or an applicable State health subsidy program (as defined in section 1413(e) of the Patient Protection and Affordable Care Act (42 U.S.C. 18083(e))); or

(II)

evaluating the integrity of the Medicare program or an applicable State health subsidy program (as so defined).

(C)

Disclosure to State agencies

(i)

In general

If, for purposes of administering an applicable State health subsidy program (as defined in section 1413(e) of the Patient Protection and Affordable Care Act (42 U.S.C. 18083(e))), a State agency responsible for administering such program transmits to the Secretary the names and social security account numbers of individuals, the Secretary shall disclose to such State agency information on such individuals and their employers maintained in the National Directory of New Hires, subject to this subparagraph.

(ii)

Condition on disclosure by the Secretary

The Secretary shall make a disclosure under clause (i) only to the extent that the Secretary determines that the disclosure would not interfere with the effective operation of the program under this part.

(iii)

Use and disclosure of information by State agencies

(I)

In general

A State agency may not use or disclose information provided under clause (i) except for purposes of administering a program referred to in clause (i).

(II)

Information security

The State agency shall have in effect data security and control policies that the Secretary finds adequate to ensure the security of information obtained under clause (i) and to ensure that access to such information is restricted to authorized persons for purposes of authorized uses and disclosures.

(III)

Penalty for misuse of information

An officer or employee of the State agency who fails to comply with this clause shall be subject to the sanctions under subsection (l)(2) to the same extent as if such officer or employee were an officer or employee of the United States.

(iv)

Procedural requirements

State agencies requesting information under clause (i) shall adhere to uniform procedures established by the Secretary governing information requests and data matching under this paragraph.

(v)

Reimbursement of costs

The State agency shall reimburse the Secretary, in accordance with subsection (k)(3), for the costs incurred by the Secretary in furnishing the information requested under this subparagraph.

.

202.

Improving the sharing of data between the Federal Government and State Medicaid programs

(a)

In general

The Secretary of Health and Human Services (in this section referred to as the Secretary) shall establish a plan to encourage and facilitate the participation of States in the Medicare-Medicaid Data Match Program (commonly referred to as the Medi-Medi Program) under section 1893(g) of the Social Security Act (42 U.S.C. 1395ddd(g)).

(b)

Program revisions To improve Medi-Medi Data Match Program participation by States

Section 1893(g)(1)(A) of the Social Security Act (42 U.S.C. 1395ddd(g)(1)(A)) is amended—

(1)

in the matter preceding clause (i), by inserting or otherwise after eligible entities;

(2)

in clause (i)—

(A)

by inserting to review claims data after algorithms; and

(B)

by striking service, time, or patient and inserting provider, service, time, or patient;

(3)

in clause (ii)—

(A)

by inserting to investigate and recover amounts with respect to suspect claims after appropriate actions; and

(B)

by striking ; and and inserting a semicolon;

(4)

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

(5)

by adding at the end the following new clause:

(iv)

furthering the Secretary’s design, development, installation, or enhancement of an automated data system architecture—

(I)

to collect, integrate, and assess data for purposes of program integrity, program oversight, and administration, including the Medi-Medi Program; and

(II)

that improves the coordination of requests for data from States.

.

(c)

Providing states with data on improper payments made for items or services provided to dual eligible individuals

(1)

In general

The Secretary shall develop and implement a plan that allows each State agency responsible for administering a State plan for medical assistance under title XIX of the Social Security Act access to relevant data on improper or fraudulent payments made under the Medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) for health care items or services provided to dual eligible individuals.

(2)

Dual eligible individual defined

In this section, the term dual eligible individual means an individual who is entitled to, or enrolled for, benefits under part A of title XVIII of the Social Security Act (42 U.S.C. 1395c et seq.), or enrolled for benefits under part B of title XVIII of such Act (42 U.S.C. 1395j et seq.), and is eligible for medical assistance under a State plan under title XIX of such Act (42 U.S.C. 1396 et seq.) or under a waiver of such plan.

203.

Improving claims processing and detection of fraud within the Medicaid and CHIP programs

(a)

Medicaid

Section 1903(i) of the Social Security Act (42 U.S.C. 1396b(i)) is amended (after the application of the amendments made by subsection (c) of this section)—

(1)

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

(2)

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

(3)

by inserting after paragraph (26), the following new paragraph:

(27)

with respect to amounts expended for an item or service for which medical assistance is provided under the State plan or under a waiver of such plan unless the claim for payment for such item or service contains a valid beneficiary identification number that, for purposes of the individual who received such item or service, has been determined by the State agency to correspond to an individual who is eligible to receive benefits under the State plan or waiver.

.

(b)

CHIP

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

(c)

Technical corrections

Effective as if included in the enactment of Public Law 111–148, the following sections of such Act are amended as follows:

(1)

Section 6402(c)(3) is amended by striking by adding at the end and inserting by inserting after paragraph (24).

(2)

Section 2001(a)(2)(B)(iii) is amended by striking by adding at the end and inserting by inserting after paragraph (25).

III

Report on implementation

301.

Report on implementation

Not later than 270 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall submit to Congress a report on the implementation of the provisions of, and the amendments made by, this Act.