,i  #aae? ,,congress  #b;d ,session  ,h4
 ,r4 #ffij  ,,9 ,,! ,,h\se ,,(          
,,repres5tatives  ,augu/ #bh1 #bjah,mr4 
,roskam 7= himself & ,mr4 ,blum5au]7    
introduc$ ! foll[+ bill2 :i* 0 ref]r$ to
 ! ,committee on ,ways & ,means1 & 9    
addition to ! ,committee on ,en]gy &    
,comm]ce1 = a p]iod to be subsequ5tly   
det]m9$ by ! ,speak]1 9 ea* case =      
consid]ation ( su* provisions z fall )9 
! jurisdiction ( ! committee conc]n$  ,a
 ,,bill  ,to e/abli% a sm>t c>d pilot   
program to combat fraud1 wa/e1 & abuse &
 to protect b5efici>y id5tity "u !      
,m$ic>e program4  #a4 ,%ort title ,?is  
,act may be cit$ z ! ,fight+ ,fraud to  
,protect ,c>e = ,s5iors ,act ( #bjah4   
#b4 ,m$ic>e sm>t c>d pilot program ,"p  
,e ( title ,,xviii ( ! ,social ,security
 ,act is am5d$ by ins]t+ aft] section   
#ahff;,e ! foll[+ new section3          
#ahff;,f4 ,sm>t c>d pilot program  7a7  
,implem5tation  7#a7 ,9 g5]al ,n lat]   
?an #cf mon?s aft] ! date ( ! enactm5t (
 ?is section1 ! ,secret>y %all e/abli% a

 pilot program 79 ?is section ref]r$ to 
z ! pilot program7 to evaluate !        
feasibility ( us+ sm>t c>d te*nology "u 
?is title4  7#b7 ,sm>t c>d te*nology    
def9$ ,9 ?is section1 ! t]m sm>t c>d    
te*nology means ! foll[+3 7,a7          
,b5efici>y sm>t c>d ,a ma*9e readable1  
tamp]-resi/ant c>d 79 ?is section ref]r$
 to z a sm>t c>d7 t includes an emb$d$  
integrat$ circuit *ip ) a secure        
micro-controll] 7z def9$ by ! ,national 
,in/itute on ,/&>ds & ,te*nology7 t     
enables ! v]ification & secure1         
electronic au!ntication ( ! id5tity ( a 
,m$ic>e b5efici>y at ! po9t ( s]vice    
?r\gh a comb9ation ( ! sm>t c>d & a     
p]sonal id5tification numb] kn[n by or  
associat$ ) su* b5efici>y4  7,b7 ,c>d   
read] te*nology ,in=mation te*nology t  
enables a suppli] & provid] to          
au!nticate ! id5tity ( a ,m$ic>e        
b5efici>y ?r\gh pres5tation ( su* a sm>t
 c>d & su* compon5ts1 ) su* au!ntication
 to be reflect$ ?r\gh ! use ( a modifi] 
or 9 ano!r appropriate mann]1 z det]m9$ 

by ! ,secret>y1 9 ! claims adjudication 
process4  7#c7 ,program design elem5ts  
,! pilot program %all be conduct$ = a   
p]iod ( #c ye>s consi/5t ) ! foll[+3    
7,a7 ,selection ( area ,9 consultation )
 ! ,inspector ,g5]al ( ! ,dep>tm5t (    
,heal? & ,human ,s]vices1 ! ,secret>y   
%all select at lea/ #c geographic areas 
9 :i* ! pilot program w op]ate4  7,b7   
,selection ( suppli] & provid] types ,9 
consultation ) ! ,inspector ,g5]al ( !  
,dep>tm5t ( ,heal? & ,human ,s]vices1 ! 
,secret>y %all select suppli] & provid] 
types t w be requir$ to p>ticipate 9 !  
pilot program 7ref]r$ to 9 ?is section z
 p>ticipat+ suppli]s & provid]s74 ,9    
select+ su* suppli] & provid] types1 !  
,secret>y %all--  7i7 take into acc\nt !
 risk ( fraud1 wa/e1 & abuse 7z describ$
 9 section #ahff7;j77#b77;,b77 ) respect
 to ! category ( provid] or suppli]7 &  
o!r factors z det]m9$ appropriate by !  
,secret>y2 &  7ii7 limit ! pilot program
 to no m ?an #b1jjj suppli]s & provid]s4
  7,c7 ,suppli] & provid] h>d%ip        

exemptions ,! ,secret>y %all exempt f   
p>ticipation 9 ! pilot program a suppli]
 or provid] t ei!r--  7i7 does n h      
access to c>d read] te*nology 7z        
describ$ 9 p>agraph 7#b77;,b772  7ii7   
does n h suffici5t int]net access2 or   
7iii7 has a l[ volume 7z det]m9$ by !   
,secret>y7 ( ,m$ic>e claims = :i* paym5t
 is made "u ?is title4  7,d7 ,sm>t c>d &
 sm>t c>d read] issuance  7i7 ,b5efici>y
 sm>t c>d issuance ,! ,secret>y %all    
provide =1 at no co/1 ! issuance 7&1 if 
necess>y1 replacem5t7 ( b5efici>y sm>t  
c>ds describ$ 9 p>agraph 7#b77;,a7 to   
all ,m$ic>e b5efici>ies resid+ 9 a      
geographic area 9 :i* ! pilot program is
 conduct$ "u subp>agraph 7,a74          
,in=mation t appe>s on ,m$ic>e c>ds us$ 
outside ! pilot program may appe> on !  
face ( ! b5efici>y sm>t c>d4  7ii7      
,suppli] & provid] sm>t c>d read]       
issuance ,at ! reque/ ( a p>ticipat+    
suppli] or provid]1 ! ,secret>y %all    
provide =1 at no co/1 ! issuance to su* 
suppli] or provid] ( sm>t c>d h>dw>e &  

s(tw>e necess>y to p>ticipate 9 ! pilot 
program4  7,e7 ,in=mation on op]ation ( 
pilot program ,! ,secret>y %all provide 
p>ticipat+ suppli]s & provid]s & ,m$ic>e
 b5efici>ies :o are furni%$ items &     
s]vices by su* suppli]s & provid]s1 )   
in=mation on ! op]ation ( ! pilot       
program1 includ+ privacy protections    
describ$ 9 subp>agraph 7,i74  7,f7      
,access to s]vices outside ! pilot      
program  7i7 ,b5efici>ies ,m$ic>e       
b5efici>ies :o receive b5efici>y sm>t   
c>ds may receive items & s]vices f      
suppli]s & provid]s n p>ticipat+ 9 !    
pilot program4  7ii7 ,suppli]s & provid]
 claims  7,i7 ,suppli]s & provid]s n    
p>ticipat+ 9 pilot ,suppli]s & provid]s 
n p>ticipat+ 9 ! pilot program may      
submit claims "u ?is title = items &    
s]vices furni%$ )\t use ( sm>t c>d      
te*nology to ,m$ic>e b5efici>ies :o     
receive b5efici>y sm>t c>ds4  7,,ii7    
,p>ticipat+ suppli]s & provid]s furni%+ 
s]vices to non-p>ticipat+ b5efici>ies   
,suppli] & provid]s p>ticipat+ 9 ! pilot

 program may submit claims "u ?is title 
= items & s]vices furni%$ to ,m$ic>e    
b5efici>ies :o d n receive b5efici>y    
sm>t c>ds4  7,g7 ,cl>ification on access
 to s]vices )\t sm>t c>ds ,9 ! case ( a 
,m$ic>e b5efici>y :o receives a         
b5efici>y sm>t c>d & does n pres5t su*  
c>d at ! "t ( receipt ( items or s]vices
 f a p>ticipat+ suppli] or provid]1 !   
p>ticipat+ suppli] or provid]--  7i7    
%all furni% su* items or s]vices to su* 
,m$ic>e b5efici>y z if su* b5efici>y    
does pres5t su* c>d2  7ii7 may submit   
claims "u ?is title = su* items or      
s]vices2 &  7iii7 %all provide1 9       
accordance ) su* mann]1 process1 & tim+ 
z specifi$ by ! ,secret>y1 in=mation to 
! ,secret>y 7?r\gh ! contractor describ$
 9 subp>agraph 7,h77 t su* b5efici>y    
receiv$ su* a sm>t c>d b did n h ! sm>t 
c>d at ! "t ! items or s]vices 7        
furni%$4  7,h7 ,private sector          
implem5tation ,! ,secret>y %all select1 
by us+ a competitive procurem5t process 
9 accordance ) ! provisions ( *apt] #a (

 title #dh1 ,code ( ,f$]al ,regulations 
7or any successor regulations71 a       
private sector contractor to implem5t & 
op]ate ! pilot program4  7,i7 ,privacy  
protections ,! ,secret>y %all ensure t !
 pilot program complies ) applicable    
,f$]al laws & regulations conc]n+       
individually id5tifiable heal?          
in=mation1 includ+ ! ,privacy ,act (    
#aigd & regulations promulgat$ "u       
section #bfd7;c7 ( ! ,heal? ,insurance  
,portability & ,acc\ntability ,act (    
#aiif & su* individually id5tifiable    
in=mation %all be exempt f disclosure "u
 section #eeb7;b77#c7 ( title #e1 ,unit$
 ,/ates ,code4  7,j7 ,m&atory           
p>ticipation ,subject to subp>agraph    
7,c71 9 ! case ( items or s]vices       
furni%$ by a provid] or suppli] includ$ 
9 a suppli] or provid] type select$ "u  
subp>agraph 7,b7 9 a geographic area    
select$ "u subp>agraph 7,a71 paym5t may 
only be made "u ?is title = su* items or
 s]vices dur+ ! p]iod ( ! pilot program 
if ! provid] or suppli] is p>ticipat+ 9 

! pilot program4  7,k7 ,prohibition (   
sm>t c>d fees ,no transaction1          
utilization1 or o!r fees may be impos$  
on ,m$ic>e b5efici>ies or p>ticipat+    
suppli]s & provid]s ) respect to ! use (
 sm>t c>ds "u ! pilot program4  7#d7    
,/akehold] input  7,a7 ,9 g5]al ,n lat] 
?an #f mon?s aft] ! date ( ! enactm5t ( 
?is section1 ! ,secret>y %all conv5e a  
panel consi/+ ( /akehold]s 7includ+     
repres5tatives ( provid]s1 suppli]s1    
,m$ic>e b5efici>ies1 & claims process+  
contractors7 select$ by ! ,secret>y =   
purposes ( provid+ input to ! ,secret>y 
on ! implem5tation ( ! pilot program    
7includ+ on ! selection ( areas &       
p>ticipants "u subp>agraphs 7,a7 & 7,b7 
( p>agraph 7#c7 & ! developm5t (        
exemptions & requirem5ts describ$ 9 su* 
p>agraph74  7,b7 ,nonapplicability (    
,,faca ,! ,f$]al ,advisory ,committee   
,act %all n apply to ! panel conv5$     
pursuant to subp>agraph 7,a74  7#e7     
,def9itions ,9 ?is section3 7,a7 ,! t]ms
 suppli] & provid] h ! mean+s giv5 !    

t]ms suppli] & provid] ( s]vices 9      
subsections 7d7 & 7u71 respectively1 (  
section #ahfa4  7,b7 ,! t]m ,m$ic>e     
b5efici>y means an individual :o is     
enroll$ 9 ! orig9al ,m$ic>e fee-=-s]vice
 program "u p>ts ,a & ,b & is n enroll$ 
9 an ,,ma plan "u "p ,c1 an eligible    
organization "u section #ahgf1 or a     
,,pace program "u section #ahid4  7b7   
,reports to ,congress ,! ,secret>y %all 
submit to ,congress ! foll[+ reports3   
7#a7 ,int]im p]=mance report ,n lat] ?an
 #b ye>s aft] ! date ! pilot program is 
implem5t$1 an int]im report on !        
p]=mance ( su* program4  7#b7 ,f9al     
p]=mance report ,n lat] ?an #ah mon?s   
aft] ! date ( ! completion ( ! pilot    
program1 a f9al evaluation on !         
effectiv5ess ( ! pilot program4 ,!      
report %all include ! foll[+3  7,a7 ,an 
evaluation ( ! ext5t to :i* heal? c>e   
fraud s*emes 7 affect$ by ! use ( sm>t  
c>d te*nology4  7,b7 ,a description (   
any b>ri]s to implem5tation ( ! pilot   
program4  7,c7 ,p>ticipant fe$back on ! 

pilot program4  7,d7 ,recomm5dations    
reg>d+ ! future use ( sm>t c>ds to      
address fraud "u ?is title4  7,e7 ,data 
on ! in=mation provid$ "u subsection    
7a77#c77;,g77iii74  4