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1 "(d) (1) Except as provided in paragraph (2), if the 2 Secretary determines that

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"(A) neither the Health Systems Agency nor the designated planning agency had been notified of any proposed capital expenditure at least sixty days prior to obligation for the expenditure; or

"(B) (i) the designated planning agency had not

approved the proposed expenditure; and

"(i) the designated planning agency had granted to the person proposing the capital expenditure an opportunity for a fair hearing with respect to the findings;

12 then, in determining Federal payments under titles V, 13 XVIII, and XIX for services furnished in the health care 14 facility for which the capital expenditure is made, the Secre15 tary shall not include any amount attributable to deprecia16 tion, interest on borrowed funds, a return on equity capital 17 (in the case of proprietary facilities), other expenses related 18 to the capital expenditure, or for direct operating costs, to

19 the extent that they can be directly associated with the 20 capital expenditure. In the case of a proposed capital ex21 penditure in a standard metropolitan statistical area which 22 encompasses more than one jurisdiction, that expenditure 23 shall require approval of the designated planning agency of 24 each jurisdiction who shall jointly review the proposal.

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1 Where the designated planning agencies do not unanimously 2 agree, the proposed expenditure shall be deemed disapproved; 3 where the designated planning agencies do not act to approve 4 or disapprove the proposed expenditure within one hundred 5 and eighty days of submission of request for approval the 6 proposed expenditure shall be deemed approved; any deemed 7 approval or disapproval shall be subject to review and 8 reversal by the Secretary following a request submitted to 9 him within sixty days of the deemed approval or disapproval, 10 for a review and reconsideration based upon the record. With 11 respect to any organization which is reimbursed on a per 12 capita, fixed fee, or negotiated rate basis, in determining the 13 Federal payments to be made under titles V, XVIII, and 14 XIX, the Secretary shall exclude an amount reasonably 15 equivalent to the amount which would otherwise be excluded 16 under this subsection if payment were made on other than a 17 per capita, fixed fee, or negotiated rate basis.

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"(2) If the Secretary, after submitting the matters in19 volved to the advisory council, determines that an exclusion 20 of expenses related to any capital expenditure would dis21 courage the operation or expansion of any health care facility or health maintenance organization which has demonstrated 23 to his satisfaction proof of its capability to provide compre24 hensive health care services (including institutional services) 25 effectively and economically, or would be inconsistent with

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"AGREEMENTS OF PHYSICIANS TO ACCEPT ASSIGNMENT

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"SEC. 1868. (a) For purposes of this section the term

3 participating physician' means a doctor of medicine or oste

4 opathy who has in effect an agreement by which he agrees

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to accept an assignment of claim (as provided for in section 6 1842 (b) (3) (B) (ii)) for each physicians' service (other 7 than those excluded from coverage by section 1862) per8 formed by him in the United States for an individual enrolled 9 under this part. The assignment shall be in a form prescribed 10 by the Secretary. The agreement may be terminated by 11 either party upon thirty days' notice to the other, filed in a manner prescribed by the Secretary.

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"(b) To expedite processing of claims from participat14 ing physicians, the Secretary shall establish procedures and 15 develop appropriate forms under which—

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"(1) each physician will submit his claims on one of alternative simplified approved bases, including multiple listing of patients, and the Secretary shall act to assure that these claims are processed expeditiously, and

"(2) The physician shall obtain from each patient enrolled under this part (except in cases where the Sec

retary finds it impractical for the patient to furnish it), and shall make available at the Secretary's request, a 24 signed statement by which the patient: (i) agrees to

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make an assignment with respect to all services fur

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(except that nothing in this paragraph shall require that there be prepared, in connection with any budget an item-by-item identification of the components of each type of anticipated expenditure or income);

"(2) provide for a capital expenditures plan for at least a five-year period (including the year to which the operating budget applies) which identifies in detail the sources of financing and the objectives of each anticipated expenditure in excess of $100,000 related to the acquisition of land, improvement of land, buildings, and equipment, and the replacement, modernization, and expansion of the buildings and equipment, and which

would, under generally accepted accounting principles, be considered capital items. The capital expenditures plan shall be a matter of public record and available in readily accessible form and fashion;

"(3) provide for annual review and updating; and "(4) be prepared, under the direction of the governing body of the institution or agency, by a committee consisting of representatives of the governing body, administrative staff, and medical staff (if any) of the

institution or agency."

AGREEMENT BY PHYSICIANS TO ACCEPT ASSIGNMENTS

SEC. 10. (a) (1) Title XVIII of the Social Security

25 Act is amended by adding the following section:

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"(ii) the physician ordinarily bills directly (and

not through such hospital) for his services; "(C) no administrative cost-savings allowance shall be payable for services which consist solely of laboratory or X-ray services which are for hospital inpatients or outpatients or are performed outside the office of the participating physician.".

(b) The amendments made by paragraph (1) shall

9 become effective July 1, 1978.

10 CRITERIA FOR DETERMINING REASONABLE CHARGE FOR

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PHYSICIANS' SERVICES

SEC. 11. (a) (1) So much of section 1842 (b) (3) of

13 the Social Security Act as follows the first sentence is

14 amended to read:

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“(3A) (A) In determining the reasonable charge for 16 services for purposes of paragraph (3) (including any 17 hospital-associated physicians), there shall be taken into 18 consideration the customary charges for similar services 19 generally made by the physician or other person furnishing 20 such services, as well as the prevailing charges in the locality 21 for similar services.

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“(B) (i) Except as otherwise provided in clause (iii),

23 no charge may be determined to be reasonable in the case of 24 bills submitted or requests for payment made under this part 25 after December 31, 1970, if it exceeds the higher of (I)