The National Academies: Advisers to the Nation on Science, Engineering, and Medicine
NATIONAL ACADEMY OF SCIENCES NATIONAL ACADEMY OF ENGINEERING INSTITUTE OF MEDICINE NATIONAL RESEARCH COUNCIL
Current Operating Status

The National Academies Testimony before Congress

Public Laws Containing Studies for the National Academies

Briefings to Congress

Congressionally Mandated Reports

Policy Statements and Historical Documents

The OCGA staff

Request a Report (Congressional and Government Staff Only)


Mailing Address:
The Office of Congressional and Government Affairs
The Keck Center of the National Academies
Keck WS1008
500 Fifth Street, NW
Washington, DC 20001
Tel: (202) 334-1601
Fax: (202) 334-2419

Back to Main Page


Title of Law:Medicare Prescription Drug, Improvement, and Modernization Act of 2003
Law #:Public Law 108-173
Passed by Congress:108th Congress (1st Session)

The following are excerpts, highlighted in red, from the final legislation and/or conference report which contain mentions of the National Academies, including studies. (Pound signs [##] between passages denote the deletion of unrelated text.)

HR 1 Hastert (R.-Ill.) 11/28/03
Enrolled (finally passed both houses)

A bill to amend Title XVIII of the Social Security Act to provide for a voluntary program for prescription drug coverage under the Medicare program, to modernize the Medicare program, and for other purposes.
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

######

SEC. 107. STUDIES AND REPORTS.

######

(c) IOM STUDY ON DRUG SAFETY AND QUALITY.—

(1) IN GENERAL.—The Secretary shall enter into a contract with the Institutes of Medicine of the National Academies of Science (such Institutes referred to in this subsection as the “IOM”) to carry out a comprehensive study (in this subsection referred to as the “study”) of drug safety and quality issues in order to provide a blueprint for system-wide change.

(2) OBJECTIVES.—

(A) The study shall develop a full understanding of drug safety and quality issues through an evidence-based review of literature, case studies, and analysis. This review will consider the nature and causes of medication errors, their impact on patients, the differences in causation, impact, and prevention across multiple dimensions of health care delivery-including patient populations, care settings, clinicians, and institutional cultures.

(B) The study shall attempt to develop credible estimates of the incidence, severity, costs of medication errors that can be useful in prioritizing resources for national quality improvement efforts and influencing national health care policy.

(C) The study shall evaluate alternative approaches to reducing medication errors in terms of their efficacy, cost-effectiveness, appropriateness in different settings and circumstances, feasibility, institutional barriers to implementation, associated risks, and the quality of evidence supporting the approach.

(D) The study shall provide guidance to consumers, providers, payers, and other key stakeholders on high-priority strategies to achieve both short-term and long-term drug safety goals, to elucidate the goals and expected results of such initiatives and support the business case for them, and to identify critical success factors and key levers for achieving success.

(E) The study shall assess the opportunities and key impediments to broad nationwide implementation of medication error reductions, and to provide guidance to policy-makers and government agencies (including the Food and Drug Administration, the Centers for Medicare & Medicaid Services, and the National Institutes of Health) in promoting a national agenda for medication error reduction.

(F) The study shall develop an applied research agenda to evaluate the health and cost impacts of alternative interventions, and to assess collaborative public and private strategies for implementing the research agenda through AHRQ and other government agencies.

(3) CONDUCT OF STUDY.—

(A) EXPERT COMMITTEE.—In conducting the study, the IOM shall convene a committee of leading experts and key stakeholders in pharmaceutical management and drug safety, including clinicians, health services researchers, pharmacists, system administrators, payer representatives, and others.

(B) COMPLETION.—The study shall be completed within an 18-month period.

(4) REPORT.—A report on the study shall be submitted to Congress upon the completion of the study.

(5) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary.

######

SEC. 109. EXPANDING THE WORK OF MEDICARE QUALITY IMPROVEMENT ORGANIZATIONS TO INCLUDE PARTS C AND D.

(a) APPLICATION TO MEDICARE MANAGED CARE AND PRESCRIPTION DRUG COVERAGE.—Section 1154(a)(1) (42 U.S.C. 1320c-3(a)(1)) is amended by inserting “, to Medicare Advantage organizations pursuant to contracts under part C, and to prescription drug sponsors pursuant to contracts under part D” after “under section 1876”.

(b) PRESCRIPTION DRUG THERAPY QUALITY IMPROVEMENT.—Section 1154(a) (42 U.S.C. 1320c-3(a)) is amended by adding at the end the following new paragraph:

“(17) The organization shall execute its responsibilities under subparagraphs (A) and (B) of paragraph (1) by offering to providers, practitioners, Medicare Advantage organizations offering Medicare Advantage plans under part C, and prescription drug sponsors offering prescription drug plans under part D quality improvement assistance pertaining to prescription drug therapy. For purposes of this part and title XVIII, the functions described in this paragraph shall be treated as a review function.”.

(c) EFFECTIVE DATE.—The amendments made by this section shall apply on and after January 1, 2004.

(d) IOM STUDY OF QIOS.—

(1) IN GENERAL.—The Secretary shall request the Institute of Medicine of the National Academy of Sciences to conduct an evaluation of the program under part B of title XI of the Social Security Act. The study shall include a review of the following:

(A) An overview of the program under such part.

(B) The duties of organizations with contracts with the Secretary under such part.

(C) The extent to which quality improvement organizations improve the quality of care for medicare beneficiaries.

(D) The extent to which other entities could perform such quality improvement functions as well as, or better than, quality improvement organizations.

(E) The effectiveness of reviews and other actions conducted by such organizations in carrying out those duties.

(F) The source and amount of funding for such organizations.

(G) The conduct of oversight of such organizations.

(2) REPORT TO CONGRESS.—Not later than June 1, 2006, the Secretary shall submit to Congress a report on the results of the study described in paragraph (1), including any recommendations for legislation.

(3) INCREASED COMPETITION.—If the Secretary finds based on the study conducted under paragraph (1) that other entities could improve quality in the medicare program as well as, or better than, the current quality improvement organizations, then the Secretary shall provide for such increased competition through the addition of new types of entities which may perform quality improvement functions.

######

SEC. 238. INSTITUTE OF MEDICINE EVALUATION AND REPORT ON HEALTH CARE PERFORMANCE MEASURES.

(a) EVALUATION.—

(1) IN GENERAL.—Not later than the date that is 2 months after the date of the enactment of this Act, the Secretary shall enter into an arrangement under which the Institute of Medicine of the National Academy of Sciences (in this section referred to as the “Institute”) shall conduct an evaluation of leading health care performance measures in the public and private sectors and options to implement policies that align performance with payment under the medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.).

(2) SPECIFIC MATTERS EVALUATED.—In conducting the evaluation under paragraph (1), the Institute shall—

(A) catalogue, review, and evaluate the validity of leading health care performance measures;

(B) catalogue and evaluate the success and utility of alternative performance incentive programs in public or private sector settings; and

(C) identify and prioritize options to implement policies that align performance with payment under the medicare program that indicate—

(i) the performance measurement set to be used and how that measurement set will be updated;

(ii) the payment policy that will reward performance; and

(iii) the key implementation issues (such as data and information technology requirements) that must be addressed.

(3) SCOPE OF HEALTH CARE PERFORMANCE MEASURES.—The health care performance measures described in paragraph (2)(A) shall encompass a variety of perspectives, including physicians, hospitals, other health care providers, health plans, purchasers, and patients.

(4) CONSULTATION WITH MEDPAC.—In evaluating the matters described in paragraph (2)(C), the Institute shall consult with the Medicare Payment Advisory Commission established under section 1805 of the Social Security Act (42 U.S.C. 1395b-6).

(b) REPORT.—Not later than the date that is 18 months after the date of enactment of this Act, the Institute shall submit to the Secretary and appropriate committees of jurisdiction of the Senate and House of Representatives a report on the evaluation conducted under subsection (a)(1) describing the findings of such evaluation and recommendations for an overall strategy and approach for aligning payment with performance, including options for updating performance measures, in 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, and any other programs under such title XVIII.

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as may be necessary for purposes of conducting the evaluation and preparing the report required by this section.

######

*********************************************************************************
HRpt 108-391 - To accompany H.R. 1 - MEDICARE PRESCRIPTION DRUG, IMPROVEMENT, AND MODERNIZATION ACT OF 2003
Conference Committee
(11/21/03)
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---

######

“SPECIAL PROVISIONS RELATING TO MEDICARE PRESCRIPTION DRUG BENEFIT

######

SEC. 107. STUDIES AND REPORTS.

######

(c) IOM STUDY ON DRUG SAFETY AND QUALITY.—

(1) IN GENERAL.—The Secretary shall enter into a contract with the Institutes of Medicine of the National Academies of Science (such Institutes referred to in this subsection as the “IOM”) to carry out a comprehensive study (in this subsection referred to as the “study”) of drug safety and quality issues in order to provide a blueprint for system-wide change.

(2) OBJECTIVES.—

(A) The study shall develop a full understanding of drug safety and quality issues through an evidence-based review of literature, case studies, and analysis. This review will consider the nature and causes of medication errors, their impact on patients, the differences in causation, impact, and prevention across multiple dimensions of health care delivery-including patient populations, care settings, clinicians, and institutional cultures.

(B) The study shall attempt to develop credible estimates of the incidence, severity, costs of medication errors that can be useful in prioritizing resources for national quality improvement efforts and influencing national health care policy.

(C) The study shall evaluate alternative approaches to reducing medication errors in terms of their efficacy, cost-effectiveness, appropriateness in different settings and circumstances, feasibility, institutional barriers to implementation, associated risks, and the quality of evidence supporting the approach.

(D) The study shall provide guidance to consumers, providers, payers, and other key stakeholders on high-priority strategies to achieve both short-term and long-term drug safety goals, to elucidate the goals and expected results of such initiatives and support the business case for them, and to identify critical success factors and key levers for achieving success.

(E) The study shall assess the opportunities and key impediments to broad nationwide implementation of medication error reductions, and to provide guidance to policy-makers and government agencies (including the Food and Drug Administration, the Centers for Medicare & Medicaid Services, and the National Institutes of Health) in promoting a national agenda for medication error reduction.

(F) The study shall develop an applied research agenda to evaluate the health and cost impacts of alternative interventions, and to assess collaborative public and private strategies for implementing the research agenda through AHRQ and other government agencies.

(3) CONDUCT OF STUDY.—

(A) EXPERT COMMITTEE.—In conducting the study, the IOM shall convene a committee of leading experts and key stakeholders in pharmaceutical management and drug safety, including clinicians, health services researchers, pharmacists, system administrators, payer representatives, and others.

(B) COMPLETION.—The study shall be completed within an 18-month period.

(4) REPORT.—A report on the study shall be submitted to Congress upon the completion of the study.

(5) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this section such sums as may be necessary.

######

SEC. 109. EXPANDING THE WORK OF MEDICARE QUALITY IMPROVEMENT ORGANIZATIONS TO INCLUDE PARTS C AND D.

(a) APPLICATION TO MEDICARE MANAGED CARE AND PRESCRIPTION DRUG COVERAGE.—Section 1154(a)(1) (42 U.S.C. 1320c-3(a)(1)) is amended by inserting “, to Medicare Advantage organizations pursuant to contracts under part C, and to prescription drug sponsors pursuant to contracts under part D” after “under section 1876”.

(b) PRESCRIPTION DRUG THERAPY QUALITY IMPROVEMENT.—Section 1154(a) (42 U.S.C. 1320c-3(a)) is amended by adding at the end the following new paragraph:

“(17) The organization shall execute its responsibilities under subparagraphs (A) and (B) of paragraph (1) by offering to providers, practitioners, Medicare Advantage organizations offering Medicare Advantage plans under part C, and prescription drug sponsors offering prescription drug plans under part D quality improvement assistance pertaining to prescription drug therapy. For purposes of this part and title XVIII, the functions described in this paragraph shall be treated as a review function.”.

(c) EFFECTIVE DATE.—The amendments made by this section shall apply on and after January 1, 2004.

(d) IOM STUDY OF QIOS.—

(1) IN GENERAL.—The Secretary shall request the Institute of Medicine of the National Academy of Sciences to conduct an evaluation of the program under part B of title XI of the Social Security Act. The study shall include a review of the following:

(A) An overview of the program under such part.

(B) The duties of organizations with contracts with the Secretary under such part.

(C) The extent to which quality improvement organizations improve the quality of care for medicare beneficiaries.

(D) The extent to which other entities could perform such quality improvement functions as well as, or better than, quality improvement organizations.

(E) The effectiveness of reviews and other actions conducted by such organizations in carrying out those duties.

(F) The source and amount of funding for such organizations.

(G) The conduct of oversight of such organizations.

(2) REPORT TO CONGRESS.—Not later than June 1, 2006, the Secretary shall submit to Congress a report on the results of the study described in paragraph (1), including any recommendations for legislation.

(3) INCREASED COMPETITION.—If the Secretary finds based on the study conducted under paragraph (1) that other entities could improve quality in the medicare program as well as, or better than, the current quality improvement organizations, then the Secretary shall provide for such increased competition through the addition of new types of entities which may perform quality improvement functions.

######

SUBTITLE D—ADDITIONAL REFORMS

######

SEC. 238. INSTITUTE OF MEDICINE EVALUATION AND REPORT ON HEALTH CARE PERFORMANCE MEASURES.

(a) EVALUATION.—

(1) IN GENERAL.—Not later than the date that is 2 months after the date of the enactment of this Act, the Secretary shall enter into an arrangement under which the Institute of Medicine of the National Academy of Sciences (in this section referred to as the “Institute”) shall conduct an evaluation of leading health care performance measures in the public and private sectors and options to implement policies that align performance with payment under the medicare program under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.).

(2) SPECIFIC MATTERS EVALUATED.—In conducting the evaluation under paragraph (1), the Institute shall—

(A) catalogue, review, and evaluate the validity of leading health care performance measures;

(B) catalogue and evaluate the success and utility of alternative performance incentive programs in public or private sector settings; and

(C) identify and prioritize options to implement policies that align performance with payment under the medicare program that indicate—

(i) the performance measurement set to be used and how that measurement set will be updated;

(ii) the payment policy that will reward performance; and

(iii) the key implementation issues (such as data and information technology requirements) that must be addressed.

(3) SCOPE OF HEALTH CARE PERFORMANCE MEASURES.—The health care performance measures described in paragraph (2)(A) shall encompass a variety of perspectives, including physicians, hospitals, other health care providers, health plans, purchasers, and patients.

(4) CONSULTATION WITH MEDPAC.—In evaluating the matters described in paragraph (2)(C), the Institute shall consult with the Medicare Payment Advisory Commission established under section 1805 of the Social Security Act (42 U.S.C. 1395b-6).

(b) REPORT.—Not later than the date that is 18 months after the date of enactment of this Act, the Institute shall submit to the Secretary and appropriate committees of jurisdiction of the Senate and House of Representatives a report on the evaluation conducted under subsection (a)(1) describing the findings of such evaluation and recommendations for an overall strategy and approach for aligning payment with performance, including options for updating performance measures, in 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, and any other programs under such title XVIII.

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as may be necessary for purposes of conducting the evaluation and preparing the report required by this section.

######

SUBPART 3—APPLICATION TO MEDICARE ADVANTAGE PROGRAM AND TREATMENT OF EMPLOYER-SPONSORED PROGRAMS AND OTHER PRESCRIPTION DRUG PLANS

######

Studies and Reports (Section 107 of Conference agreement; New Section 1860D-10 of House bill; Section 102, Section 106 and Section 110 of Senate bill).

######

Conference Agreement

The agreement requires the Secretary to study variations in per capita spending for covered Part D drugs among PDP regions to determine the amount of such variation that is attributable to price variations and the differences in per capita utilization that is not taken into account in the health status risk adjustment made to PDP bids. The Secretary is required to submit a report to Congress on the study including information on the extent of geographic variation in per capita utilization, an analysis of the impact of direct subsidies and whether such subsidies should be adjusted to take into account such variation, and recommendations regarding the appropriateness of applying an additional geographic adjustment factor to bids.

The conference agreement requires the Secretary, within six months of enactment, to review the current standards of practice for pharmacy services provided to patients in nursing facilities. Specifically, the Secretary is to assess: (1) the current standards of practice, clinical services, and other service requirements generally utilized for such pharmacy services; and (2) evaluate the impact of those standards with respect to patient safety, reduction of medication errors, and quality of care. The report is to contain a description of the Secretary’s plans to implement this Act in a manner consistent with applicable state and federal laws designed to protect the safety and quality of care of nursing facility patients. The report must also include recommendations regarding necessary actions.

The conference agreement requires the Secretary to enter into a contract with the Institute of Medicine to carry out a comprehensive study of drug safety and quality issues in order to provide a blueprint for system-wide change. The objectives of the study are to: (1) develop a full understanding of drug safety and quality issues through an evidence-based review of the literature, case studies, and analysis; (2) attempt to develop credible estimates of the incidence, severity and costs of medication errors; (3) evaluate alterative approaches to reducing medication errors; (4) provide guidance on high-priority strategies to achieve drug safety goals; (5) assess opportunities and key impediments to broad nationwide implementation of medication error reductions; and (6) develop an applied research agenda to evaluate the health and cost impacts of alternative interventions. The study is to be completed within an 18-month period. Such sums as may be necessary are authorized.

######

SUBTITLE D—ADDITIONAL REFORMS

######

Section 238. Study of performance-based payment systems

Present Law

No provision.

House Bill

Section 237. The Secretary would request that the IOM conduct a study to review and evaluate public and private sector experiences in: (1) establishing performance measures and payment incentives under the Medicare program, and (2) linking performance to payment. The Secretary would also request that no later than 18 months after enactment, the Institute submit a report to the Secretary and the Congress that included a review and evaluation of incentives to encourage quality performance, as specified in the statute. The study would also examine how these measures and incentives might be applied in the Medicare MA, EFFS, and FFS programs. The report would include recommendations regarding appropriate performance measures for use in assessing and paying for quality and would identify options for updating performance measures.

Senate Bill

Section 224. Within 2 months of enactment, the Secretary would be required to enter into an arrangement with IOM to evaluate leading health care performance measures and options to implement policies that align performance with payment under the Medicare program. The information that would be catalogued, reviewed and evaluated by IOM would be specified in statute. A report would be due to the Secretary and the congressional committees of jurisdiction within 18 months of enactment. There would be $1 million authorized to be appropriated to conduct the evaluation and prepare the report.

Conference Agreement

Section 238. The conference agreement requires that within 2 months of enactment, the Secretary shall enter into an arrangement with IOM to evaluate leading health care performance measures in the public and private sectors and options to implement policies that align performance with payment under the Medicare program. The information examined by IOM includes the validity of leading health care performance measures, the success and utility of alternative performance incentive programs, and options to implement policy that aligns performance with payments. The Institute shall consult with MedPAC. A report is to be due to the Secretary and the congressional committees of jurisdiction within 18 months of enactment. There will be authorized to be appropriated such sums as may be necessary to conduct the evaluation and prepare the report.

######

SUBTITLE B—MISCELLANEOUS PROVISIONS

######

Pediatric Palliative Care Demonstration

Medicare is designed for aged and disabled individuals (typically people over 65 years of age). It was not designed with children in mind.

The conferees are aware of potential barriers in the current system for children with life-threatening illnesses. First, in order to qualify for hospice, a doctor must certify that a child has 6 months to live. Determining how long a child has to live is often difficult. Second, the current system does not allow a patient to receive curative and palliative care simultaneously. This means that children can either receive treatment for their disease or they can receive palliative care.

HHS should conduct a demonstration project in up to 6 geographically diverse sites to determine whether palliative care for children may be improved under circumstances where such barriers are reduced or eliminated. Such demonstration shall take place over at least a three-year period.

The Secretary, in conducting such demonstration project, should take into account the recommendations of the Institute of Medicine in its report: “When Children Die: Improving Palliative and End-of-Life Care for Children and Their Families.”

In particular, the Secretary should consider including as part of the demonstration:

1. Waivers To Elect Hospice Care and Receive Curative Treatment.

2. Care coordination from diagnosis to end of life.

3. Features to ensure that parents have information about existing pediatric hospice and palliative care programs to make decisions about the care of their child.

4. Bereavement counseling for the family and reimbursement to provider.

The conferees believe that it is important that the Secretary have flexibility when conducting such demonstration to provide additional benefits so long as they are consistent with the recommendations contained in the IOM Report and they are provided in budget neutral manner. The conferees also believe that the Secretary should provide reports to Congress, as appropriate, that include an evaluation of the short- and long-term costs and benefits of palliative care under traditional Medicare and the demonstration projects, determine the quality and duration of palliative care under the demonstration project, and evaluate whether there is an offset of savings by providing pediatric palliative care, and the projected cost of implementing the demonstrations on a national basis.

######

RSS News Feed | Subscribe to e-newsletters | Feedback | Back to Top