[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3613 Introduced in Senate (IS)]
110th CONGRESS
2d Session
S. 3613
To amend title XVIII of the Social Security Act to provide certain high
cost Medicare beneficiaries suffering from multiple chronic conditions
with access to Independence at Home services in lower cost treatment
settings, such as their residences, under a plan of care developed by
an Independence at Home physician or Independence at Home nurse
practitioner.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
September 26 (legislative day, September 17), 2008
Mr. Wyden (for himself, Ms. Mikulski, Mr. Whitehouse, and Mr. Cardin)
introduced the following bill; which was read twice and referred to the
Committee on Finance
_______________________________________________________________________
A BILL
To amend title XVIII of the Social Security Act to provide certain high
cost Medicare beneficiaries suffering from multiple chronic conditions
with access to Independence at Home services in lower cost treatment
settings, such as their residences, under a plan of care developed by
an Independence at Home physician or Independence at Home nurse
practitioner.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Independence at Home Act of 2008''.
SEC. 2. FINDINGS.
Congress makes the following findings:
(1) According to the November 2007 Congressional Budget
Office Long Term Outlook for Health Care Spending, unless
changes are made to the way health care is delivered, growing
demand for resources caused by rising health care costs and to
a lesser extent the Nation's expanding elderly population will
confront Americans with increasingly difficult choices between
health care and other priorities. However, opportunities exist
to constrain health care costs without adverse health care
consequences.
(2) Medicare beneficiaries with multiple chronic conditions
account for a disproportionate share of Medicare spending
compared to their representation in the overall Medicare
population, and evidence suggests that such patients often
receive poorly coordinated care, including conflicting
information from health providers and different diagnoses of
the same symptoms.
(3) People with chronic conditions account for 76 percent
of all hospital admissions, 88 percent of all prescriptions
filled, and 72 percent of physician visits.
(4) More than 60 percent of physicians treating patients
with chronic conditions believe that their training did not
adequately prepare them to coordinate in-home and community
services; educate patients with chronic conditions; manage the
psychological and social aspects of chronic care; provide
effective nutritional guidance; and manage chronic pain.
(5) Recent studies cited by the Congressional Budget Office
found substantial differences among regions of the country in
the cost to Medicare of treating beneficiaries with multiple
chronic conditions with lower cost regions experiencing better
outcomes and lower mortality rates. These studies have
suggested that Medicare spending could be reduced by 30 percent
if more conservative practice styles were adopted, however, the
current Medicare fee-for-service program creates incentives to
provide fragmented, high cost health care services.
(6) Studies show that hospital utilization and emergency
room visits for patients with multiple chronic conditions can
be reduced and significant savings can be achieved through the
use of interdisciplinary teams of health care professionals
caring for patients in their places of residence.
(7) The Independence at Home program, designed to fund
better health care and improved health care technology through
savings it achieves, uses a patient-centered health care
delivery model to permit the growing number of Medicare
beneficiaries with multiple chronic conditions to remain as
independent as possible for as long as possible and to receive
care in a setting that is preferred by the beneficiary involved
and the family of such beneficiary.
(8) The Independence at Home program begins Medicare reform
by creating incentives for practitioners and providers to
develop methods and technologies for providing better and lower
cost health care to the highest cost Medicare beneficiaries
with the greatest incentives provided in the case of highest
cost beneficiaries.
(9) The Independence at Home program incorporates lessons
learned from prior demonstration projects and phase I of the
Voluntary Chronic Care Improvement program under section 1807
of the Social Security Act, enacted in sections 721 and 722 of
the Medicare Prescription Drug, Improvement and Modernization
Act of 2003 (Public Law 108-173).
(10) The Independence at Home Act provides for a chronic
care coordination demonstration for the highest cost Medicare
beneficiaries with multiple chronic conditions that holds
providers accountable for quality outcomes, patient
satisfaction, and mandatory minimum savings on an annual basis.
(11) The Independence at Home Act generates savings by
providing better, more coordinated care to the highest cost
Medicare beneficiaries with multiple chronic conditions,
reducing duplicative and unnecessary services, and avoiding
unnecessary hospitalizations and emergency room visits.
SEC. 3. ESTABLISHMENT OF VOLUNTARY INDEPENDENCE AT HOME CHRONIC CARE
COORDINATION DEMONSTRATION PROJECT UNDER TRADITIONAL
MEDICARE FEE-FOR-SERVICE PROGRAM.
(a) In General.--Title XVIII of the Social Security Act is
amended--
(1) by amending subsection (c) of section 1807 (42 U.S.C.
1395b-8) to read as follows:
``(c) Independence at Home Chronic Care Coordination Demonstration
Project.--A demonstration project for Independence at Home chronic care
coordination programs for high cost Medicare beneficiaries with
multiple chronic conditions is set forth in section 1807A.''; and
(2) by inserting after section 1807 the following new
section:
``independence at home chronic care coordination demonstration project
``Sec. 1807A. (a) In General.--
``(1) Implementation.--The Secretary shall, where possible,
enter into agreements with at least two unaffiliated
Independence at Home organizations, as described in this
section, to provide chronic care coordination services for a
period of three years in each of the 13 highest cost States and
the District of Columbia and in 13 additional States that are
representative of other regions of the United States. Such
organizations shall have documented experience in furnishing
the types of services covered by this section to eligible
beneficiaries in non-institutional settings using qualified
teams of health care professionals that are directed by
Independence at Home physicians or Independence at Home nurse
practitioners and that use health information technology and
individualized plans of care.
``(2) Eligibility.--Any organization shall be eligible for
an Independence at Home agreement in the developmental phase if
it is an Independence at Home organization (as defined in
subsection (b)(7)) and has the demonstrated capacity to provide
the services covered under this section to the number of
eligible beneficiaries specified in subsection (e)(3)(C). No
organization shall be prohibited from participating because of
its small size as long as it meets the eligibility requirements
of this section.
``(3) Independent evaluation.--The Secretary shall contract
for an independent evaluation of the Independence at Home
demonstration project under this section with an interim report
to be provided after the first year and a final report to be
provided after the third year of the project. Such an
evaluation shall be conducted by a contractor with knowledge of
chronic care coordination programs for the targeted patient
population and demonstrated experience in the evaluation of
such programs. Each such report shall include an assessment of
the following factors and shall identify the characteristics of
individual Independence at Home programs that are the most
effective:
``(A) Quality improvement measures.
``(B) Beneficiary, caregiver, and provider
satisfaction.
``(C) Health outcomes appropriate for patients with
multiple chronic conditions.
``(D) Cost savings to the program under this title.
``(4) Agreements.--The Secretary shall enter into
agreements, beginning not later than one year after the date of
the enactment of this section, with Independence at Home
organizations that meet the participation requirements of this
section, including minimum performance standards developed
under subsection (e)(3), in order to provide access by eligible
beneficiaries to Independence at Home programs under this
section.
``(5) Regulations.--At least three months before entering
into the first agreement under this section, the Secretary
shall publish in the Federal Register the specifications for
implementing this section.
``(6) Periodic progress reports.--Semi-annually during the
first year in which this section is implemented and annually
thereafter during the period of implementation of this section,
the Secretary shall submit to the Committees on Ways and Means
and Energy and Commerce of the House of Representatives and the
Committee on Finance of the Senate a report that describes the
progress of implementation of this section and explaining any
variation from the Independence at Home program as described in
this section.
``(b) Definitions.--For purposes of this section:
``(1) Activities of daily living.--The term `activities of
daily living' means bathing, dressing, grooming, transferring,
feeding, or toileting.
``(2) Caregiver.--The term `caregiver' means, with respect
to an individual with a qualifying functional impairment, a
family member, friend, or neighbor who provides assistance to
the individual.
``(3) Eligible beneficiary.--
``(A) In general.--The term `eligible beneficiary'
means, with respect to an Independence at Home program,
an individual who--
``(i) is entitled to benefits under part A
and enrolled under part B, but not enrolled in
a plan under part C;
``(ii) has a qualifying functional
impairment and has been diagnosed with two or
more of the chronic conditions described in
subparagraph (C); and
``(iii) within the 12 months prior to the
individual first enrolling with an Independence
at Home program under this section, has
received benefits under this title for services
described in each of clauses (i), (ii) and
(iii) of subparagraph (D).
``(B) Disqualifications.--Such term does not
include an individual--
``(i) who is receiving benefits under
section 1881;
``(ii) who is enrolled in a PACE program
under section 1894;
``(iii) who is enrolled in (and is not
disenrolled from) a chronic care improvement
program under section 1807;
``(iv) who within the previous year has
been a resident for more than 90 days in a
skilled nursing facility, a nursing facility
(as defined in section 1919), or any other
facility identified by the Secretary;
``(v) who resides in a setting that
presents a danger to the safety of in-home
health care providers and primary caregivers;
or
``(vi) whose enrollment in an Independence
at Home program the Secretary determines would
be inappropriate.
``(C) Chronic conditions described.--The chronic
conditions described in this subparagraph are the
following:
``(i) Congestive heart failure.
``(ii) Diabetes.
``(iii) Chronic obstructive pulmonary
disease.
``(iv) Ischemic heart disease.
``(v) Peripheral arterial disease.
``(vi) Stroke.
``(vii) Alzheimer's Disease and other
dementias designated by the Secretary.
``(viii) Pressure ulcers.
``(ix) Hypertension.
``(x) Neurodegenerative diseases designated
by the Secretary which result in high costs
under this title, including amyotropic lateral
sclerosis (ALS), multiple sclerosis, and
Parkinson's disease.
``(xi) Any other chronic condition that the
Secretary identifies as likely to result in
high costs to the program under this title when
such condition is present in combination with
one or more of the chronic conditions specified
in the preceding clauses.
``(D) Services described.--The services described
in this subparagraph are the following:
``(i) Non-elective inpatient hospital
services.
``(ii) Services in the emergency department
of a hospital.
``(iii) Any of the following services:
``(I) Extended care services.
``(II) Services in an acute
rehabilitation facility.
``(III) Home health services.
``(4) Independence at home assessment.--The term
`Independence at Home assessment' means, with respect to an
eligible beneficiary, a comprehensive medical history, physical
examination, and assessment of the beneficiary's clinical and
functional status that--
``(A) is conducted by--
``(i) an Independence at Home physician or
an Independence at Home nurse practitioner;
``(ii) a physician assistant, nurse
practitioner, or clinical nurse specialist, as
defined in section 1861(aa)(5), who is employed
by an Independence at Home organization and is
working in collaboration with an Independence
at Home physician or Independence at Home nurse
practitioner; or
``(iii) any other health care professional
that meets such conditions as the Secretary may
specify; and
``(B) includes an assessment of--
``(i) activities of daily living and other
co-morbidities;
``(ii) medications and medication
adherence;
``(iii) affect, cognition, executive
function, and presence of mental disorders;
``(iv) functional status, including
mobility, balance, gait, risk of falling, and
sensory function;
``(v) social functioning and social
integration;
``(vi) environmental needs and a safety
assessment;
``(vii) the ability of the beneficiary's
primary caregiver to assist with the
beneficiary's care as well as the caregiver's
own physical and emotional capacity, education,
and training;
``(viii) whether the beneficiary is likely
to benefit from an Independence at Home
program;
``(ix) whether the conditions in the
beneficiary's home or place of residence would
permit the safe provision of services in the
home or residence, respectively, under an
Independence at Home program; and
``(x) other factors determined appropriate
by the Secretary.
``(5) Independence at home care team.--The term
`Independence at Home care team'--
``(A) means, with respect to a participant, a team
of qualified individuals that provides services to the
participant as part of an Independence at Home program;
and
``(B) includes an Independence at Home physician or
an Independence at Home nurse practitioner and an
Independence at Home coordinator (who may also be an
Independence at Home physician or an Independence at
Home nurse practitioner).
``(6) Independence at home coordinator.--The term
`Independence at Home coordinator' means, with respect to a
participant, an individual who--
``(A) is employed by an Independence at Home
organization and is responsible for coordinating all of
the elements of the participant's Independence at Home
plan;
``(B) is a licensed health professional, such as a
physician, registered nurse, nurse practitioner,
clinical nurse specialist, physician assistant, or
other health care professional as the Secretary
determines appropriate, who has at least one year of
experience providing and coordinating medical and
related services for individuals in their homes; and
``(C) serves as the primary point of contact
responsible for communications with the participant and
for facilitating communications with other health care
providers under the plan.
``(7) Independence at home organization.--The term
`Independence at Home organization' means a provider of
services, a physician or physician group practice, a nurse
practitioner or nurse practitioner group practice, or other
legal entity which receives payment for services furnished
under this title (other than only under this section) and
which--
``(A) has entered into an agreement under
subsection (a)(2) to provide an Independence at Home
program under this section;
``(B)(i) is able to provide all of the elements of
the Independence at Home plan in a participant's home
or place of residence, or
``(ii) if the organization is not able to provide
all such elements in such home or residence, has
adequate mechanisms for ensuring the provision of such
elements by one or more qualified entities;
``(C) has Independence at Home physicians, clinical
nurse specialists, nurse practitioners, or physician
assistants available to respond to patient emergencies
24 hours a day, seven days a week;
``(D) accepts all eligible beneficiaries from the
organization's service area except to the extent that
qualified staff are not available; and
``(E) meets other requirements for such an
organization under this section.
``(8) Independence at home physician.--The term
`Independence at Home physician' means a physician who--
``(A) is employed by or affiliated with an
Independence at Home organization, as required under
paragraph (7)(C), or has another contractual
relationship with the Independence at Home organization
that requires the physician to be responsible for the
plans of care for the physician's patients;
``(B) is certified--
``(i) by the American Board of Family
Physicians, the American Board of Internal
Medicine, the American Osteopathic Board of
Family Physicians, the American Osteopathic
Board of Internal Medicine, the American Board
of Emergency Medicine, or the American Board of
Physical Medicine and Rehabilitation; or
``(ii) by a Board recognized by the
American Board of Medical Specialties and
determined by the Secretary to be appropriate
for the Independence at Home program;
``(C) has--
``(i) a certification in geriatric medicine
as provided by American Board of Medical
Specialties; or
``(ii) passed the clinical competency
examination of the American Academy of Home
Care Physicians and has substantial experience
in the delivery of medical care in the home,
including at least two years of experience in
the management of Medicare patients and one
year of experience in home-based medical care
including at least 200 house calls; and
``(D) has furnished services during the previous 12
months for which payment is made under this title.
``(9) Independence at home nurse practitioner.--The term
`Independence at Home nurse practitioner' means a nurse
practitioner who--
``(A) is employed by or affiliated with an
Independence at Home organization, as required under
paragraph (7)(C), or has another contractual
relationship with the Independence at Home organization
that requires the nurse practitioner to be responsible
for the plans of care for the nurse practitioner's
patients;
``(B) practices in accordance with State law
regarding scope of practice for nurse practitioners;
``(C) is certified--
``(i) as a Gerontologic Nurse Practitioner
by the American Academy of Nurse Practitioners
Certification Program or the American Nurses
Credentialing Center; or
``(ii) as a family nurse practitioner or
adult nurse practitioner by the American
Academy of Nurse Practitioners Certification
Board or the American Nurses Credentialing
Center and holds a certificate of Added
Qualification in gerontology, elder care or
care of the older adult provided by the
American Academy of Nurse Practitioners, the
American Nurses Credentialing Center or a
national nurse practitioner certification board
deemed by the Secretary to be appropriate for
an Independence at Home program; and
``(D) has furnished services during the previous 12
months for which payment is made under this title.
``(10) Independence at home plan.--The term `Independence
at Home plan' means a plan established under subsection (d)(2)
for a specific participant in an Independence at Home program.
``(11) Independence at home program.--The term
`Independence at Home program' means a program described in
subsection (d) that is operated by an Independence at Home
organization.
``(12) Participant.--The term `participant' means an
eligible beneficiary who has voluntarily enrolled in an
Independence at Home program.
``(13) Qualified entity.--The term `qualified entity' means
a person or organization that is licensed or otherwise legally
permitted to provide the specific element (or elements) of an
Independence at Home plan that the entity has agreed to
provide.
``(14) Qualifying functional impairment.--The term
`qualifying functional impairment' means an inability to
perform, without the assistance of another person, two or more
activities of daily living.
``(c) Identification and Enrollment of Prospective Program
Participants.--
``(1) Notice to eligible independence at home
beneficiaries.--The Secretary shall develop a model notice to
be made available to Medicare beneficiaries (and to their
caregivers) who are potentially eligible for an Independence at
Home program by participating providers and by Independence at
Home programs. Such notice shall include the following
information:
``(A) A description of the potential advantages to
the beneficiary participating in an Independence at
Home program.
``(B) A description of the eligibility requirements
to participate.
``(C) Notice that participation is voluntary.
``(D) A statement that all other Medicare benefits
remain available to beneficiaries who enroll in an
Independence at Home program.
``(E) Notice that those who enroll in an
Independence at Home program may have co-payments for
house calls by Independence at Home physicians or by
Independence at Home nurse practitioners reduced or
eliminated at the discretion of the Independence at
Home physician or Independence at Home nurse
practitioner involved.
``(F) A description of the services that could
potentially be provided under an Independence at Home
plan.
``(G) A description of the method for
participating, or withdrawing from participation, in an
Independence at Home program or becoming no longer
eligible to so participate.
``(2) Voluntary participation and choice.--An eligible
beneficiary may participate in an Independence at Home program
through enrollment in such program on a voluntary basis and may
terminate such participation at any time. Such a beneficiary
may also receive Independence at Home services from the
Independence at Home organization of the beneficiary's choice
but may not receive Independence at Home services from more
than one Independence at Home organization at a time.
``(d) Independence at Home Program Requirements.--
``(1) In general.--Each Independence at Home program shall,
for each participant enrolled in the program--
``(A) designate--
``(i) an Independence at Home physician or
an Independence at Home nurse practitioner; and
``(ii) an Independence at Home coordinator;
``(B) have a process to ensure that the participant
received an Independence at Home assessment before
enrollment in the program;
``(C) with the participation of the participant (or
the participant's representative or caregiver), an
Independence at Home physician or an Independence at
Home nurse practitioner, and Independence at Home
coordinator, develop an Independence at Home plan for
the participant in accordance with paragraph (2);
``(D) ensure that the participant receives an
Independence at Home assessment at least annually after
the original assessment to ensure that the Independence
at Home plan for the participant remains current and
appropriate;
``(E) implement all of the elements of the
participant's Independence at Home plan and in
instances in which the Independence at Home
organization does not provide specific elements of the
Independence at Home plan, ensure that qualified
entities successfully implement those specific
elements;
``(F) provide for an electronic medical record and
electronic health information technology to coordinate
the participant's care and to exchange information with
the Medicare program and electronic monitoring and
communication technologies and mobile diagnostic and
therapeutic technologies as appropriate and accepted by
the participant; and
``(G) respect the participant's right to health
information privacy and obtain permission from the
participant (or responsible person) for the use and
disclosure of identifiable health information necessary
for treatment, payment, or health care operations.
``(2) Independence at home plan.--
``(A) In general.--An Independence at Home plan for
a participant shall be developed with the participant,
an Independence at Home physician or an Independence at
Home nurse practitioner, an Independence at Home
coordinator, and, if appropriate, one or more of the
participant's caregivers and shall--
``(i) document the chronic conditions, co-
morbidities, and other health needs identified
in the participant's Independence at Home
assessment;
``(ii) determine which elements of an
Independence at Home plan described in
subparagraph (C) are appropriate for the
participant; and
``(iii) identify the qualified entity
responsible for providing each element of such
plan.
``(B) Communication of individualized independence
at home plan to the independence at home coordinator.--
If the Independence at Home physician or Independence
at Home nurse practitioner responsible for conducting
the participant's Independence at Home assessment and
developing the Independence at Home plan is not the
participant's Independence at Home coordinator, the
Independence at Home physician or Independence at Home
nurse practitioner is responsible for ensuring that the
participant's Independence at Home coordinator has such
plan and is familiar with the requirements of the plan
and has the appropriate contact information for all of
the members of the Independence at Home care team.
``(C) Elements of independence at home plan.--An
Independence at Home organization shall have the
capability to provide, directly or through a qualified
entity, and shall offer all of the following elements
of an Independence at Home plan to the extent they are
appropriate and accepted by a participant:
``(i) Self-care education and preventive
care consistent with the participant's
condition.
``(ii) Coordination of all medical
treatment furnished to the participant,
regardless of whether such treatment is covered
and available to the participant under this
title.
``(iii) Information about, and access to,
hospice care.
``(iv) Pain and palliative care and end-of-
life care.
``(v) Education for primary caregivers and
family members.
``(vi) Caregiver counseling services and
information about, and referral to, other
caregiver support and health care services in
the community.
``(vii) Monitoring and management of
medications as well as assistance to
participants and their caregivers with respect
to selection of a prescription drug plan under
part D that best meets the needs of the
participant's chronic conditions.
``(viii) Referral to social services, such
as personal care, meals, volunteers, and
individual and family therapy.
``(ix) Access to phlebotomy and ancillary
laboratory and imaging services, including
point of care laboratory and imaging
diagnostics.
``(3) Primary treatment role within an independence at home
care team.--An Independence at Home physician or an
Independence at Home nurse practitioner may assume the primary
treatment role as permitted under State law.
``(4) Additional responsibilities.--
``(A) Outcomes report.--Each Independence at Home
organization offering an Independence at Home program
shall monitor and report to the Secretary, in a manner
specified by the Secretary, on--
``(i) patient outcomes;
``(ii) beneficiary, caregiver, and provider
satisfaction with respect to coordination of
the participant's care; and
``(iii) the achievement of mandatory
minimum savings described in subsection (e)(6).
``(B) Additional requirements.--Each such
organization and program shall comply with such
additional requirements as the Secretary may specify.
``(e) Terms and Conditions.--
``(1) In general.--An agreement under this section with an
Independence at Home organization shall contain such terms and
conditions as the Secretary may specify consistent with this
section.
``(2) Clinical, quality improvement, and financial
requirements.--The Secretary may not enter into an agreement
with such an organization under this section for the operation
of an Independence at Home program unless--
``(A) the program and organization meet the
requirements of subsection (d), minimum quality and
performance standards developed under paragraph (3),
and such clinical, quality improvement, financial, and
other requirements as the Secretary deems to be
appropriate for participants to be served; and
``(B) the organization demonstrates to the
satisfaction of the Secretary that the organization is
able to assume financial risk for performance under the
agreement with respect to payments made to the
organization under such agreement through available
reserves, reinsurance, or withholding of funding
provided under this title, or such other means as the
Secretary determines appropriate.
``(3) Minimum quality and performance standards.--
``(A) In general.--The Secretary shall develop
mandatory minimum quality and performance standards for
Independence at Home organizations and programs.
``(B) Standards to be included.--Such standards
shall include measures of--
``(i) participant outcomes;
``(ii) satisfaction of the beneficiary,
caregiver, and provider involved; and
``(iii) cost savings consistent with
paragraph (6).
``(C) Minimum participation standard.--Such
standards shall include a requirement that, for any
year after the first year, an Independence at Home
program had an average number of participants during
the previous year of at least 100 participants.
``(4) Term of agreement and modification.--The agreement
under this subsection shall be, subject to paragraphs (3)(C)
and (5), for a period of three years, and the terms and
conditions may be modified during the contract period only upon
the request of the Independence at Home organization.
``(5) Termination and non-renewal of agreement.--
``(A) In general.--If the Secretary determines that
an Independence at Home organization has failed to meet
the minimum performance standards under paragraph (3)
or other requirements under this section, the Secretary
may terminate the agreement of the organization at the
end of the contract year.
``(B) Required termination where risk to health or
safety of a participant.--The Secretary shall terminate
an agreement with an Independence at Home organization
at any time the Secretary determines that the care
being provided by such organization poses a threat to
the health and safety of a participant.
``(C) Termination by independence at home
organizations.--Notwithstanding any other provision of
this subsection, an Independence at Home organization
may terminate an agreement with the Secretary under
this section to provide an Independence at Home program
at the end of a contract year if the organization
provides to the Secretary and to the beneficiaries
participating in the program notification of such
termination more than 90 days before the end of such
year. Paragraphs (6), (8), and (9)(B) shall apply to
the organization until the date of termination.
``(D) Notice of involuntary termination.--The
Secretary shall notify the participants in an
Independence at Home program as soon as practicable if
a determination is make to terminate an agreement with
the Independence at Home organization involuntarily as
provided in subparagraphs (A) and (B). Such notice
shall inform the beneficiary of any other Independence
at Home organizations that might be available to the
beneficiary.
``(6) Mandatory minimum savings.--
``(A) In general.--Under an agreement under this
subsection, each Independence at Home organization
shall ensure that during any year of the agreement for
its Independence at Home program, there is an aggregate
savings in the cost to the program under this title for
participating beneficiaries, as calculated under
subparagraph (B), that is not less than the product
of--
``(i) 5 percent of the estimated average
monthly costs that would have been incurred
under parts A, B, and D if those beneficiaries
had not participated in the Independence at
Home program; and
``(ii) the number of participant-months for
that year.
``(B) Computation of aggregate savings.--
``(i) Model for calculating savings.--The
Secretary shall contract with a nongovernmental
organization or academic institution to
independently develop an analytical model for
determining whether an Independence at Home
program achieves at least savings required
under subparagraph (A) relative to costs that
would have been incurred by Medicare in the
absence of Independence at Home programs. The
analytical model developed by the independent
research organization for making these
determinations shall utilize state-of-the-art
econometric techniques, such as Heckman's
selection correction methodologies, to account
for sample selection bias, omitted variable
bias, or problems with endogeneity.
``(ii) Application of the model.--Using the
model developed under clause (i), the Secretary
shall compare the actual costs to Medicare of
beneficiaries participating in an Independence
at Home program to the predicted costs to
Medicare of such beneficiaries to determine
whether an Independence at Home program
achieves the savings required under
subparagraph (A).
``(iii) Revisions of the model.--The
Secretary shall require that the model
developed under clause (i) for determining
savings shall be designed according to
instructions that will control, or adjust for,
inflation as well as risk factors including,
age, race, gender, disability status,
socioeconomic status, region of country (such
as State, county, metropolitan statistical
area, or zip code), and such other factors as
the Secretary determines to be appropriate,
including adjustment for prior health care
utilization. The Secretary may add to, modify,
or substitute for such adjustment factors if
such changes will improve the sensitivity or
specificity of the calculation of costs
savings.
``(iv) Participant-month.--In making the
calculation described in subparagraph (A), each
month or part of a month in a program year that
a beneficiary participates in an Independence
at Home program shall be counted as a
`participant-month'.
``(C) Notice of savings calculation.--No later than
120 days before the beginning of any Independence at
Home program year, the Secretary shall publish in the
Federal Register a description of the model developed
under subparagraph (B)(i) and information for
calculating savings required under subparagraph (A),
including any revisions, sufficient to permit
Independence at Home organizations to determine the
savings they will be required to achieve during the
program year to meet the savings requirement under such
subparagraph. In order to facilitate this notice, the
Secretary may designate a single annual date for the
beginning of all Independence at Home program years
that shall not be later than one year from the date of
enactment of this section.
``(7) Manner of payment.--Subject to paragraph (8),
payments shall be made by the Secretary to an Independence at
Home organization at a rate negotiated between the Secretary
and the organization under the agreement for--
``(A) Independence at Home assessments; and
``(B) on a per-participant, per-month basis for the
items and services required to be provided or made
available under subsection (d).
``(8) Ensuring mandatory minimum savings.--The Secretary
shall require any Independence at Home organization that fails
in any year to achieve the mandatory minimum savings described
in paragraph (6) to provide those savings by refunding payments
made to the organization under paragraph (7) during such year.
``(9) Budget neutral payment condition.--
``(A) In general.--Under this section, the
Secretary shall ensure that the cumulative, aggregate
sum of Medicare program benefit expenditures under
parts A, B, and D for participants in Independence at
Home programs and funds paid to Independence at Home
organizations under this section, shall not exceed the
Medicare program benefit expenditures under such parts
that the Secretary estimates would have been made for
such participants in the absence of such programs.
``(B) Treatment of savings.--If an Independence at
Home organization achieves aggregate savings in a year
in excess of the mandatory minimum savings described in
paragraph (6), 80 percent of such aggregate savings
shall be paid to the organization and the remainder
shall be retained by the programs under this title.
``(f) Waiver of Coinsurance for House Calls.--A physician or nurse
practitioner furnishing services in the home or residence of a
participant in an Independence at Home program may waive collection of
any coinsurance that might otherwise be payable under section 1833(a)
with respect to such services.
``(g) Report.--Not later than one year after the end of the
Independence at Home demonstration project under this section, the
Secretary shall submit to Congress a report on such project. Such
report shall include information on--
``(1) whether Independence at Home programs under the
project met the performance standards for beneficiary,
caregiver, and provider satisfaction; and
``(2) participant outcomes and cost savings, as well as the
characteristics of the programs that were most effective and
whether the participant eligibility criteria identified
beneficiaries who were in the top ten percent of the highest
cost Medicare beneficiaries.''.
(b) Conforming Amendments.--
(1) Section 1833(a) of such Act (42 U.S.C. 1395l(a)) is
amended, in the matter before paragraph (1), by inserting ``and
section 1807A(f)'' after ``section 1876''.
(2) Section 1128B(b)(3) of such Act (42 U.S.C. 1320a-
7b(b)(3)) is amended--
(A) by striking ``and'' at the end of subparagraph
(G);
(B) by striking ``1853(a)(4).'' at the end of the
first subparagraph (H) and inserting ``1853(a)(4);'';
(C) by redesignating the second subparagraph (H) as
subparagraph (I) and by striking the period at the end
and inserting ``; and''; and
(D) by adding at the end the following new
subparagraph:
``(J) a waiver of coinsurance under section
1807A(f).''.
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