114 STAT. 2763A-548 PUBLIC LAW 106-554—APPENDIX F coding system (as such system was in effect on August 16, 2000) through December 31, 2003, and shall make such codes available to the public. (b) DEFINITION. —For purposes of this section, the term "HCPCS Level III codes" means the alphanumeric codes for local use under the Health Care Financing Administration Common Procedure Coding System (HCPCS). SEC. 533. RECOGNITION OF NEW MEDICAL TECHNOLOGIES UNDER INPATIENT HOSPITAL PPS. (a) EXPEDITING RECOGNITION OF NEW TECHNOLOGIES INTO INPATIENT PPS CODING SYSTEM.— (1) REPORT. —Not later than April 1, 2001, the Secretary of Health and Human Services shall submit to Congress a report on methods of expeditiously incorporating new medical services and technologies into the clinical coding system used with respect to payment for inpatient hospital services furnished under the medicare program under title XVIII of the Social Security Act, together with a detailed description of the Secretary's preferred methods to achieve this purpose. (2) IMPLEMENTATION. — Not later than October 1, 2001, the Secretary shall implement the preferred methods described in the report transmitted pursuant to paragraph (1). (b) ENSURING APPROPRIATE PAYMENTS FOR HOSPITALS INCOR- PORATING NEW MEDICAL SERVICES AND TECHNOLOGIES.— (1) ESTABLISHMENT OF MECHANISM.— Section 1886(d)(5) (42 U.S.C. 1395ww(d)(5)) is amended by adding at the end the following new subparagraphs: "(K)(i) Effective for discharges beginning on or after October 1, 2001, the Secretary shall establish a mechanism to recognize the costs of new medical services and technologies under the pay- ment system established under this subsection. Such mechanism shall be established after notice and opportunity for public comment (in the publications required by subsection (e)(5) for a fiscal year or otherwise). "(ii) The mechanism established pursuant to clause (i) shall— "(I) apply to a new medical service or technology if, based on the estimated costs incurred with respect to discharges involving such service or technology, the DRG prospective pay- ment rate otherwise applicable to such discharges under this subsection is inadequate; "(II) provide for the collection of data with respect to the costs of a new medical service or technology described in subclause (I) for a period of not less than two years and not more than three years beginning on the date on which an inpatient hospital code is issued with respect to the service or technology; "(III) subject to paragraph (4)(C)(iii), provide for additional payment to be made under this subsection with respect to discharges involving a new medical service or technology described in subclause (I) that occur during the period described in subclause (II) in an amount that adequately reflects the estimated average cost of such service or technology; and "(IV) provide that discharges involving such a service or technology that occur after the close of the period described in subclause (II) will be classified within a new or existing
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