ELIMINATION OF WASTE, FRAUD, AND ABUSE.

SEC. 4724. ELIMINATION OF WASTE, FRAUD, AND ABUSE. (a) Ban on Spending for Nonhealth Related Items.—Section 1903(i) (42 U.S.C. 1396b(i)) is amended— (1) in paragraphs (2) and (16), by striking the period at the end and inserting “; or”; (2) in paragraphs (10)(B), (11), and (13), by adding “or” at the end; and (3) by inserting after paragraph (16), the following: “(17) with respect to any amount expended for roads, bridges, stadiums, or any other item or service not covered under a State plan under this title.”. (b) Surety Bond Requirement for Home Health Agencies.— (1) In general.—Section 1903(i) (42 U.S.C. 1396b(i)), as amended by subsection (a), is amended— (A) in paragraph (17), by striking the period at the end and inserting “; or”; and (B) by inserting after paragraph (17), the following: “(18) with respect to any amount expended for home health care services provided by an agency or organization unless the agency or organization provides the State agency on a continuing basis a surety bond in a form specified by the Secretary under paragraph (7) of section 186 l(o) and in an amount that is not less than $50,000 or such comparable surety bond as the Secretary may permit under the last sentence of such section.”. (2) Effective date.—The amendments made by paragraph (1) shall apply to home health care services furnished on or after January 1, 1998. (c) Conflict of Interest Safeguards.— (1) In general.—Section 1902(a)(4)(C) (42 U.S.C. 1396a(a)(4)(C)) is amended— (A) by striking “and (C)” and inserting “(C)”; (B) by striking “local officer or employee” and inserting “local officer, employee, or independent contractor”; (C) by striking “such an officer or employee” the first 2 places it appears and inserting “such an officer, employee, or contractor”; and111 STAT. 517 (D) by inserting before the semicolon the following: “, and (D) that each State or local officer, employee, or independent contractor who is responsible for selecting, awarding, or otherwise obtaining items and services under the State plan shall be subject to safeguards against conflicts of interest that are at least as stringent as the safeguards that apply under section 27 of the Office of Federal Procurement Policy Act (41 U.S.C. 423) to persons described in subsection (a)(2) of such section of that Act”. (2) Effective date.—The amendments made by paragraph (1) shall take effect on January 1, 1998. (d) Authority to Refuse to Enter Into Medicaid Agreements With Individuals or Entities Convicted of Felonies.—Section 1902(a)(23) (42 U.S.C. 1396(a)) is amended— (1) by striking “except as provided in subsection (g) and in section 1915 and except in the case of Puerto Rico, the Virgin Islands, and Guam,”; and (2) by inserting before the semicolon at the end the following: “, except as provided in subsection (g) and in section 1915, except that this paragraph shall not apply in the case of Puerto Rico, the Virgin Islands, and Guam, and except that nothing in this paragraph shall be construed as requiring a State to provide medical assistance for such services furnished by a person or entity convicted of a felony under Federal or State law for an offense which the State agency determines is inconsistent with the best interests of beneficiaries under the State plan”. (e) Monitoring Payments for Dual Eligibles.—The Administrator of the Health Care Financing Administration shall develop mechanisms to improve the monitoring of, and to prevent, inappropriate payments under the medicaid program under title XIX of the Social Security Act (42 U.S.C. 1396 et seq.) in the case of individuals who are dually eligible for benefits under such program and under the medicare program under title XVIII of such Act (42 U.S.C. 1395 et seq.). (f) Beneficiary and Program Protection Against Waste, Fraud, and Abuse.—Section 1902(a) (42 U.S.C. 1396a(a)) is amended— (1) by striking “and” at the end of paragraph (62); (2) by striking the period at the end of paragraph (63) and inserting “; and”; and (3) by inserting after paragraph (63) the following: “(64) provide, not later than 1 year after the date of the enactment of this paragraph, a mechanism to receive reports from beneficiaries and others and compile data concerning alleged instances of waste, fraud, and abuse relating to the operation of this title;”. (g) Disclosure of Information and Surety Bond Requirement for Suppliers of Durable Medical Equipment.— (1) Requirement.—Section 1902(a) (42 U.S.C. 1396a(a)), as amended by subsection (f), is amended— (A) by striking “and” at the end of paragraph (63); (B) by striking the period at the end of paragraph (64) and inserting “; and”; and (C) by inserting after paragraph (64) the following: “(65) provide that the State shall issue provider numbers for all suppliers of medical assistance consisting of durable 111 STAT. 518medical equipment, as defined in section 186 l(n), and the State shall not issue or renew such a supplier number for any such supplier unless— “(A)(i) full and complete information as to the identity of each person with an ownership or control interest (as defined in section 1124(a)(3)) in the supplier or in any subcontractor (as defined by the Secretary in regulations) in which the supplier directly or indirectly has a 5 percent or more ownership interest; and “(ii) to the extent determined to be feasible under regulations of the Secretary, the name of any disclosing entity (as defined in section 1124(a)(2)) with respect to which a person with such an ownership or control interest in the supplier is a person with such an ownership or control interest in the disclosing entity; and “(B) a surety bond in a form specified by the Secretary under section 1834(a)(16)(B) and in an amount that is not less than $50,000 or such comparable surety bond as the Secretary may permit under the second sentence of such section.”. (2) Effective date.—The amendments made by paragraph (1) shall apply to suppliers of medical assistance consisting of durable medical equipment furnished on or after January 1, 1998.