Ill STAT. 390 PUBLIC LAW 105-33 —AUG. 5, 1997 SEC. 4315. REPLACEMENT OF REASONABLE CHARGE METHODOLOGY BY FEE SCHEDULES. (a) APPLICATION OF FEE SCHEDULE.—Section 1842 (42 U.S.C. 1395u) is amended by adding at the end the following new subsection: "(s)(l) The Secretary may implement a statewide or other areawide fee schedule to be used for payment of any item or service described in paragraph (2) which is paid on a reasonable charge basis. Any fee schedule established under this paragraph for such item or service shall be updated each year by the percentage increase in the consumer price index for all urban consumers (United States city average) for the 12-month period ending with June of the preceding year, except that in no event shall a fee schedule for an item described in paragraph (2)(D) be updated before 2003. "(2) The items and services described in this paragraph are as follows: "(A) Medical supplies. "(B) Home dialysis supplies and equipment (as defined in section 1881(b)(8)). "(C) Therapeutic shoes. "(D) Parenteral and enteral nutrients, equipment, and supplies. "(E) Electromyogram devices "(F) Salivation devices. "(G) Blood products. "(H) Transfusion medicine.". (b) CONFORMING AMENDMENT. —Section 1833(a)(1) (42 U.S.C. 13951(a)(1)) is amended— (A) by striking "and (P)" and inserting "(P)"; and (B) by striking the semicolon at the end and inserting the following: ", and (Q) with respect to items or services for which fee schedules are established pursuant to section 1842(s), the amounts paid shall be 80 percent of the lesser of the actual charge or the fee schedule established in such section;". 42 USC 1395/ (c) EFFECTIVE DATES. —The amendments made by this section note. to the extent such amendments substitute fee schedules for reasonable charges, shall apply to particular services as of the date specified by the Secretary of Health and Human Services. 42 USC I395u (d) INITIAL BUDGET NEUTRALITY.—The Secretary, in developing note. a fee schedule for particular services (under the amendments made by this section), shall set amounts for the first year period to which the fee schedule applies at a level so that the total payments under title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) for those services for that year period shall be approximately equal to the estimated total payments if such fee schedule had not been implemented. SEC. 4316. APPLICATION OF INHERENT REASONABLENESS TO ALL PART B SERVICES OTHER THAN PHYSICLANS' SERVICES. (a) IN GENERAL. — Paragraphs (8) and (9) of section 1842(b) (42 U.S.C. 1395u(b)) are amended to read as follows: Regulations. "(8)(A)(i) The Secretary shall by regulation— "(I) describe the factors to be used in determining the cases (of particular items or services) in which the application of this part (other than to physicians' services paid under
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