SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Frontline Medical Education Act''.

SEC. 2. INCLUDING SERVICES OF INTERNS AND RESIDENTS AT ANY FEDERALLY-
              QUALIFIED HEALTH CENTER UNDER ANY PROGRAM PAID FOR BY A 
              HOSPITAL IN DETERMINING MEDICARE PAYMENTS FOR GRADUATE 
              MEDICAL EDUCATION.

    (a) Payment for Direct Costs of Graduate Medical Education.--
Section 1886(h)(4)(E) of the Social Security Act (42 U.S.C. 
1395ww(h)(4)(E)) is amended by striking ``setting.'' and inserting the 
following: ``setting (or, in the case of activities performed at an 
Federally-qualified health center described in section 1861(aa)(4), if 
the hospital incurs any of the costs for the training program at such 
center and reimburses the center for any of the costs of the program 
that the center incurs).''.
    (b) Payment for Indirect Costs of Graduate Medical Education.--
Section 1886(d)(5)(B)(iv) of such Act (42 U.S.C. 1395ww(d)(5)(B)(iv)), 
as amended by section 13506 of the Omnibus Budget Reconciliation Act of 
1993, is amended--
            (1) by striking ``entity receiving a grant'' and all that 
        follows through ``control of the hospital'' and inserting 
        ``Federally-qualified health center described in section 
        1861(aa)(4)'';
            (2) by striking ``all, or substantially all, of the costs'' 
        and inserting ``any of the costs''; and
            (3) by striking ``residents)'' and inserting ``residents 
        and reimburses the center for any of the costs of the program 
        that the center incurs)''.
    (c) Effective Date.--The amendments made by subsections (a) and (b) 
shall apply to services furnished during cost reporting periods 
beginning on or after October 1, 1994.

SEC. 3. MEDICARE PAYMENT FOR DIRECT MEDICAL EDUCATION COSTS OF 
              FEDERALLY-QUALIFIED HEALTH CENTERS.

    (a) In General.--Title XVIII of the Social Security Act (42 U.S.C. 
1395 et seq.) is amended by inserting after section 1889 the following 
new section:

 ``graduate medical education payments for federally-qualified health 
                                centers

    ``Sec. 1890. (a) In General.--Notwithstanding any other provision 
of this title, in the case of any Federally-qualified health center 
that participates in an approved medical residency training program, in 
addition to any other payments that may be made to the center under 
this title, the Secretary shall provide for payment to the center for 
direct graduate medical education costs in accordance with subsection 
(b).
    ``(b) Determination of Amount of Payment.--
            ``(1) In general.--Subject to paragraph (4), the amount of 
        payment made to a Federally-qualified health center under this 
        section for direct medical education for a fiscal year is equal 
        to the product of--
                    ``(A) the aggregate approved amount (as defined in 
                paragraph (2)) for the year; and
                    ``(B) the center's medicare patient load (as 
                defined in subsection (d)(2)) for the year.
            ``(2) Aggregate approved amount.--In paragraph (1), the 
        term `aggregate approved amount' means, for a fiscal year, the 
        product of--
                    ``(A) the approved FTE resident amount (determined 
                under paragraph (3)) for the year; and
                    ``(B) the weighted average number of full-time 
                equivalent residents (as determined by the Secretary in 
                a manner similar to the manner used to determine the 
                number of such residents under section 1886(h)(4)) 
                providing services for the center under the approved 
                medical residency training program in which the center 
                participates during the year.
            ``(3) Determination of approved fte resident amount.--
                    ``(A) In general.--For each approved medical 
                residency training program, the Secretary shall 
                determine an approved FTE resident amount for each 
                fiscal year (beginning with fiscal year 1995) equal to 
                250 percent of the national average salary for the year 
                (as defined in subparagraph (B)(ii)).
                    ``(B) Determination of national average salary.--
                            ``(i) Determination of base amount.--The 
                        Secretary shall determine a base salary amount 
                        equal to the Secretary's estimate (using the 
                        most recent available audited cost reports) of 
                        the national average salary, including fringe 
                        benefits, for a full-time-equivalent resident 
                        in an approved medical residency training 
                        program during fiscal year 1990, increased (in 
                        a compounded manner) by the sum of the 
                        estimated percentage changes in the consumer 
                        price index during the 12-month periods between 
                        the midpoint of fiscal year 1990 and the 
                        midpoint of fiscal year 1994.
                            ``(ii) National average salary defined.--In 
                        this paragraph, the `national average salary' 
                        for a fiscal year is equal to--
                                    ``(I) for fiscal year 1995, the 
                                base amount determined under clause (i) 
                                updated through the midpoint of the 
                                year by projecting the estimated 
                                percentage change in the consumer price 
                                index during the 12-month period ending 
                                at that midpoint (with appropriate 
                                adjustments to reflect previous under- 
                                or over-estimations under this 
                                subparagraph in the projected 
                                percentage change in the consumer price 
                                index); and
                                    ``(II) for a subsequent fiscal 
                                year, the amount determined under this 
                                clause for the previous fiscal year 
                                updated through the midpoint of the 
                                year by projecting the estimated 
                                percentage change in the consumer price 
                                index during the 12-month period ending 
                                at that midpoint (with appropriate 
                                adjustments to reflect previous under- 
                                or over-estimations under this 
                                subparagraph in the projected 
                                percentage change in the consumer price 
                                index).
            ``(4) Offset for reimbursement received directly through 
        hospitals.--The amount of payment made to a Federally-qualified 
        health center under this subsection with respect to costs 
        incurred by the center shall be reduced by the amount of any 
        payment received by the center from a hospital under section 
        1886(d)(5)(B)(iv) or section 1886(h)(4)(E) as reimbursement for 
        such costs.
    ``(c) Allocation of Payments Among Trust Funds.--In providing for 
payments under this section, the Secretary shall provide for an 
allocation of such payments between part A and part B (and the trust 
funds established under the respective parts) as reasonably reflects 
the proportion of direct graduate medical costs of Federally-qualified 
health centers associated with the provision of services under each 
respective part.
    ``(d) Definitions.--In this section:
            ``(1) The terms `approved medical residency training 
        program', `consumer price index', `direct graduate medical 
        education costs', and `resident' have the meaning given such 
        terms under section 1886(h)(5).
            ``(2) The term `Federally-qualified health center' has the 
        meaning given such term under section 1861(aa)(4).
            ``(3) The term `medicare patient load' means, with respect 
        to a Federally-qualified health center for a year, the fraction 
        of the center's services during the year which are attributable 
        to individuals entitled to benefits under this title (based on 
        such measure of services as the Secretary determines to be 
        appropriate for purposes of this section).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to services furnished during cost reporting periods beginning on 
or after October 1, 1994.

SEC. 4. REPEAL OF APPLICATION OF PRODUCTIVITY SCREENS FOR CENTERS 
              RECEIVING PAYMENTS FOR MEDICAL EDUCATION.

    Section 1861(aa) of the Social Security Act (42 U.S.C. 1395x(aa)) 
is amended by adding at the end the following new paragraph:
    ``(8)(A) In the case of a Federally-qualified health center 
receiving any medical education payment described in subparagraph (B) 
during a cost reporting period, the Secretary shall waive the 
application of any screening guideline used to determine the 
productivity of practitioners providing services at the center for 
purposes of paragraph (3) or (4).
    ``(B) A medical education payment described in this subparagraph is 
a payment made to a Federally-qualified health center--
            ``(i) by a hospital as reimbursement to the center for 
        medical education costs, as described in section 
        1886(d)(5)(B)(iv) or section 1886(h)(4)(E); or
            ``(ii) by the Secretary under section 1890.''.
Frontline Medical Education Act - Amends title XVIII (Medicare) of the Social Security Act with respect to:  (1) services of interns and residents at federally-qualified health centers and Medicare payments for graduate medical education; (2) Medicare payment for direct graduate medical education costs of such centers; and (3) waiver of the application of productivity screens for such centers receiving medical education payments.
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