
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC1395e]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
        SUBCHAPTER XVIII--HEALTH INSURANCE FOR AGED AND DISABLED
 
        Part A--Hospital Insurance Benefits for Aged and Disabled
 
Sec. 1395e. Deductibles and coinsurance


(a) Inpatient hospital services; outpatient hospital diagnostic 
        services; blood; post-hospital extended care services

    (1) The amount payable for inpatient hospital services or inpatient 
critical access hospital services furnished an individual during any 
spell of illness shall be reduced by a deduction equal to the inpatient 
hospital deductible or, if less, the charges imposed with respect to 
such individual for such services, except that, if the customary charges 
for such services are greater than the charges so imposed, such 
customary charges shall be considered to be the charges so imposed. Such 
amount shall be further reduced by a coinsurance amount equal to--
        (A) one-fourth of the inpatient hospital deductible for each day 
    (before the 91st day) on which such individual is furnished such 
    services during such spell of illness after such services have been 
    furnished to him for 60 days during such spell; and
        (B) one-half of the inpatient hospital deductible for each day 
    (before the day following the last day for which such individual is 
    entitled under section 1395d(a)(1) of this title to have payment 
    made on his behalf for inpatient hospital services or inpatient 
    critical access hospital services during such spell of illness) on 
    which such individual is furnished such services during such spell 
    of illness after such services have been furnished to him for 90 
    days during such spell;

except that the reduction under this sentence for any day shall not 
exceed the charges imposed for that day with respect to such individual 
for such services (and for this purpose, if the customary charges for 
such services are greater than the charges so imposed, such customary 
charges shall be considered to be the charges so imposed).
    (2)(A) The amount payable to any provider of services under this 
part for services furnished an individual shall be further reduced by a 
deduction equal to the expenses incurred for the first three pints of 
whole blood (or equivalent quantities of packed red blood cells, as 
defined under regulations) furnished to the individual during each 
calendar year, except that such deductible for such blood shall in 
accordance with regulations be appropriately reduced to the extent that 
there has been a replacement of such blood (or equivalent quantities of 
packed red blood cells, as so defined); and for such purposes blood (or 
equivalent quantities of packed red blood cells, as so defined) 
furnished such individual shall be deemed replaced when the institution 
or other person furnishing such blood (or such equivalent quantities of 
packed red blood cells, as so defined) is given one pint of blood for 
each pint of blood (or equivalent quantities of packed red blood cells, 
as so defined) furnished such individual with respect to which a 
deduction is made under this sentence.
    (B) The deductible under subparagraph (A) for blood or blood cells 
furnished an individual in a year shall be reduced to the extent that a 
deductible has been imposed under section 1395l(b) of this title to 
blood or blood cells furnished the individual in the year.
    (3) The amount payable for post-hospital extended care services 
furnished an individual during any spell of illness shall be reduced by 
a coinsurance amount equal to one-eighth of the inpatient hospital 
deductible for each day (before the 101st day) on which he is furnished 
such services after such services have been furnished to him for 20 days 
during such spell.
    (4)(A) The amount payable for hospice care shall be reduced--
        (i) in the case of drugs and biologicals provided on an 
    outpatient basis by (or under arrangements made by) the hospice 
    program, by a coinsurance amount equal to an amount (not to exceed 
    $5 per prescription) determined in accordance with a drug copayment 
    schedule (established by the hospice program) which is related to, 
    and approximates 5 percent of, the cost of the drug or biological to 
    the program, and
        (ii) in the case of respite care provided by (or under 
    arrangements made by) the hospice program, by a coinsurance amount 
    equal to 5 percent of the amount estimated by the hospice program 
    (in accordance with regulations of the Secretary) to be equal to the 
    amount of payment under section 1395f(i) of this title to that 
    program for respite care;

except that the total of the coinsurance required under clause (ii) for 
an individual may not exceed for a hospice coinsurance period the 
inpatient hospital deductible applicable for the year in which the 
period began. For purposes of this subparagraph, the term ``hospice 
coinsurance period'' means, for an individual, a period of consecutive 
days beginning with the first day for which an election under section 
1395d(d) of this title is in effect for the individual and ending with 
the close of the first period of 14 consecutive days on each of which 
such an election is not in effect for the individual.
    (B) During the period of an election by an individual under section 
1395d(d)(1) of this title, no copayments or deductibles other than those 
under subparagraph (A) shall apply with respect to services furnished to 
such individual which constitute hospice care, regardless of the setting 
in which such services are furnished.

(b) Inpatient hospital deductible; application

    (1) The inpatient hospital deductible for 1987 shall be $520. The 
inpatient hospital deductible for any succeeding year shall be an amount 
equal to the inpatient hospital deductible for the preceding calendar 
year, changed by the Secretary's best estimate of the payment-weighted 
average of the applicable percentage increases (as defined in section 
1395ww(b)(3)(B) of this title) which are applied under section 
1395ww(d)(3)(A) of this title for discharges in the fiscal year that 
begins on October 1 of such preceding calendar year, and adjusted to 
reflect changes in real case mix (determined on the basis of the most 
recent case mix data available). Any amount determined under the 
preceding sentence which is not a multiple of $4 shall be rounded to the 
nearest multiple of $4 (or, if it is midway between two multiples of $4, 
to the next higher multiple of $4).
    (2) The Secretary shall promulgate the inpatient hospital deductible 
and all coinsurance amounts under this section between September 1 and 
September 15 of the year preceding the year to which they will apply.
    (3) The inpatient hospital deductible for a year shall apply to--
        (A) the deduction under the first sentence of subsection (a)(1) 
    of this section for the year in which the first day of inpatient 
    hospital services or inpatient critical access hospital services 
    occurs in a spell of illness, and
        (B) to the coinsurance amounts under subsection (a) of this 
    section for inpatient hospital services, inpatient critical access 
    hospital services and post-hospital extended care services furnished 
    in that year.

(Aug. 14, 1935, ch. 531, title XVIII, Sec. 1813, as added Pub. L. 89-97, 
title I, Sec. 102(a), July 30, 1965, 79 Stat. 292; amended Pub. L. 90-
248, title I, Secs. 129(c)(3), (4), 135(a), 137(b), Jan. 2, 1968, 81 
Stat. 847, 848, 852, 854; Pub. L. 97-35, title XXI, Secs. 2131(a), 
2132(a), Aug. 13, 1981, 95 Stat. 797; Pub. L. 97-248, title I, 
Sec. 122(e), Sept. 3, 1982, 96 Stat. 361; Pub. L. 99-272, title IX, 
Sec. 9125(a), Apr. 7, 1986, 100 Stat. 168; Pub. L. 99-509, title IX, 
Sec. 9301(a), Oct. 21, 1986, 100 Stat. 1981; Pub. L. 100-203, title IV, 
Sec. 4002(f)(3), Dec. 22, 1987, as added Pub. L. 100-360, title IV, 
Sec. 411(b)(1)(H)(ii), July 1, 1988, 102 Stat. 769; Pub. L. 100-360, 
title I, Sec. 102, July 1, 1988, 102 Stat. 685; Pub. L. 101-234, title 
I, Sec. 101(a), Dec. 13, 1989, 103 Stat. 1979; Pub. L. 103-432, title I, 
Sec. 102(g)(2), (3), Oct. 31, 1994, 108 Stat. 4404; Pub. L. 105-33, 
title IV, Sec. 4201(c)(1), Aug. 5, 1997, 111 Stat. 373.)


                               Amendments

    1997--Pub. L. 105-33 substituted ``critical access'' for ``rural 
primary care'' wherever appearing.
    1994--Subsec. (a)(1). Pub. L. 103-432, Sec. 102(g)(2), substituted 
``inpatient hospital services or inpatient rural primary care hospital 
services'' for ``inpatient hospital services'' in introductory 
provisions and in subpar. (B).
    Subsec. (b)(3)(A). Pub. L. 103-432, Sec. 102(g)(2), substituted 
``inpatient hospital services or inpatient rural primary care hospital 
services'' for ``inpatient hospital services''.
    Subsec. (b)(3)(B). Pub. L. 103-432, Sec. 102(g)(3), substituted 
``inpatient hospital services, inpatient rural primary care hospital 
services'' for ``inpatient hospital services''.
    1989--Subsecs. (a)(1) to (3), (b)(3). Pub. L. 101-234 repealed Pub. 
L. 100-360, Sec. 102, subject to an exception for blood deduction, and 
provided that the provisions of law amended or repealed by such section 
are restored or revived as if such section had not been enacted, see 
1988 Amendment notes below.
    1988--Subsec. (a)(1) to (3). Pub. L. 100-360, Sec. 102(1), amended 
pars. (1) to (3) generally, revising and reorganizing former pars. 
(1)(A), (B), (2), and (3), as par. (1), consisting of subpars. (A) to 
(D), and pars. (2) and (3), each consisting of subpars. (A) and (B).
    Subsec. (b)(1). Pub. L. 100-360, Sec. 411(b)(1)(H)(ii), added Pub. 
L. 100-203, Sec. 4002(f)(3), see 1987 Amendment note below.
    Subsec. (b)(3). Pub. L. 100-360, Sec. 102(2), struck out par. (3) 
which related to application of deductible.
    1987--Subsec. (b)(1). Pub. L. 100-203, Sec. 4002(f)(3), as added by 
Pub. L. 100-360, Sec. 411(b)(1)(H)(ii), substituted ``Secretary's best 
estimate of the payment-weighted average of the applicable percentage 
increases (as defined in section 1395ww(b)(3)(B) of this title) which 
are applied'' for ``applicable percentage increase (as defined in 
section 1395ww(b)(3)(B) of this title) which is applied''.
    1986--Subsec. (b). Pub. L. 99-509 amended subsec. (b) generally. 
Prior to amendment, subsec. (b) read as follows:
    ``(1) The inpatient hospital deductible which shall be applicable 
for the purposes of subsection (a) of this section shall be $40 in the 
case of any spell of illness beginning before 1969.
    ``(2) The Secretary shall, between July 1 and September 15 of 1968, 
and of each year thereafter, determine and promulgate the inpatient 
hospital deductible which shall be applicable for the purposes of 
subsection (a) of this section in the case of any inpatient hospital 
services or post-hospital extended care services furnished during the 
succeeding calendar year. Such inpatient hospital deductible shall be 
equal to $45 multiplied by the ratio of (A) the current average per diem 
rate for inpatient hospital services for the calendar year preceding the 
promulgation, to (B) the current average per diem rate for such services 
for 1966. Any amount determined under the preceding sentence which is 
not a multiple of $4 shall be rounded to the nearest multiple of $4 (or, 
if it is midway between two multiplies of $4, to the next higher 
multiple of $4). The current average per diem rate for any year shall be 
determined by the Secretary on the basis of the best information 
available to him (at the time the determination is made) as to the 
amounts paid under this part on account of inpatient hospital services 
furnished during such year, by hospitals which have agreements in effect 
under section 1395cc of this title, to individuals who are entitled to 
hospital insurance benefits under section 426 of this title, plus the 
amount which would have been so paid but for subsection (a)(1) of this 
section.''
    Subsec. (b)(2). Pub. L. 99-272 substituted ``September 15'' for 
``October 1''.
    1982--Subsec. (a)(4). Pub. L. 97-248 added par. (4).
    1981--Subsec. (b)(2). Pub. L. 97-35 substituted ``any inpatient 
hospital services or post-hospital extended care services furnished 
during the succeeding calendar year. Such inpatient hospital deductible 
shall be equal to $45'' for ``any spell of illness beginning during the 
succeeding calendar year. Such inpatient hospital deductible shall be 
equal to $40''.
    1968--Subsec. (a)(1). Pub. L. 90-248, Sec. 137(b), designated 
existing provisions as subpar. (A) and added subpar. (B) and the 
exception provision that the reduction for any day shall not exceed the 
charges for that day.
    Subsec. (a)(2). Pub. L. 90-248, Sec. 135(a), made the three pint 
deductible applicable also to equivalent quantities of packed red blood 
cells, as defined by the Secretary under regulations.
    Subsec. (a)(2) to (4). Pub. L. 90-248, Sec. 129(c)(3), struck out 
par. (2) which provided for reduction of amount payable for outpatient 
hospital diagnostic services furnished an individual during a diagnostic 
study, and redesignated pars. (3) and (4) as (2) and (3), respectively.
    Subsec. (b)(1), (2). Pub. L. 90-248, Sec. 129(c)(4)(A), (B), struck 
out diagnostic studies from application of inpatient hospital 
deductible.


                    Effective Date of 1997 Amendment

    Amendment by Pub. L. 105-33 applicable to services furnished on or 
after Oct. 1, 1997, see section 4201(d) of Pub. L. 105-33, set out as a 
note under section 1395f of this title.


                    Effective Date of 1989 Amendment

    Amendment by Pub. L. 101-234 effective Jan. 1, 1990, see section 
101(d) of Pub. L. 101-234, set out as a note under section 1395c of this 
title.


                    Effective Date of 1988 Amendment

    Amendment by section 102 of Pub. L. 100-360 effective Jan. 1, 1989, 
except as otherwise provided, and applicable to inpatient hospital 
deductible for 1989 and succeeding years, to care and services furnished 
on or after Jan. 1, 1989, to premiums for January 1989 and succeeding 
months, and to blood or blood cells furnished on or after Jan. 1, 1989, 
see section 104(a) of Pub. L. 100-360, set out as a note under section 
1395d of this title.
    Section 411(b)(1)(H)(iii) of Pub. L. 100-360 provided that: ``The 
amendment made by clause (ii) [amending Pub. L. 100-203] shall apply to 
the inpatient hospital deductible for years beginning with 1989.''


                    Effective Date of 1986 Amendments

    Section 9301(b) of Pub. L. 99-509 provided that: ``The amendment 
made by subsection (a) [amending this section] shall apply to inpatient 
hospital services and post-hospital extended care services furnished on 
or after January 1, 1987, and to the monthly premium (under part A of 
title XVIII of the Social Security Act [this part]) for months beginning 
with January 1987.''
    Section 9125(b) of Pub. L. 99-272 provided that: ``The amendment 
made by this section [amending this section] shall apply to calendar 
years after 1985.''


                    Effective Date of 1982 Amendment

    Amendment by Pub. L. 97-248 applicable to hospice care provided on 
or after Nov. 1, 1983, see section 122(h)(1) of Pub. L. 97-248, as 
amended, set out as a note under section 1395c of this title.


                    Effective Date of 1981 Amendment

    Section 2131(b) of Pub. L. 97-35 provided that: ``The amendment made 
by subsection (a) [amending this section] is effective for inpatient 
hospital services or post-hospital extended care services furnished on 
or after January 1, 1982.''
    Section 2132(b) of Pub. L. 97-35 provided that: ``The amendments 
made by subsection (a) [amending this section] shall apply to inpatient 
hospital services and post-hospital extended care services furnished in 
calendar years beginning with calendar year 1982.''


                    Effective Date of 1968 Amendment

    Amendment by section 129(c)(3), (4) of Pub. L. 90-248 applicable 
with respect to services furnished after Mar. 31, 1968, see section 
129(d) of Pub. L. 90-248, set out as a note under section 1395d of this 
title.
    Section 135(d) of Pub. L. 90-248 provided that: ``The amendments 
made by this section [amending this section and sections 1395l and 
1395cc of this title] shall apply with respect to payment for blood (or 
packed red blood cells) furnished an individual after December 31, 
1967.''
    Amendment by section 137(b) of Pub. L. 90-248 applicable with 
respect to services furnished after Dec. 31, 1967, see section 137(c) of 
Pub. L. 90-248, set out as a note under section 1395d of this title.


          Repeal of 1988 Expansion of Medicare Part A Benefits

    Section 101(a)-(b)(2) of Pub. L. 101-234, as amended by Pub. L. 101-
508, title IV, Sec. 4008(m)(1), Nov. 5, 1990, 104 Stat. 1388-53, 
provided that:
    ``(a) In General.--
        ``(1) General rule.--Except as provided in paragraph (2), 
    sections 101, 102, and 104(d) (other than paragraph (7)) of the 
    Medicare Catastrophic Coverage Act of 1988 (Public Law 100-360) 
    [amending this section and sections 1395c, 1395d, 1395f, 1395k, 
    1395x, 1395cc, and 1395tt of this title] (in this Act referred to as 
    `MCCA') are repealed, and the provisions of law amended or repealed 
    by such sections are restored or revived as if such section had not 
    been enacted.
        ``(2) Exception for blood deduction.--The repeal of section 
    102(1) of MCCA [amending this section] (relating to deductibles and 
    coinsurance under part A) shall not apply, but only insofar as such 
    section amended paragraph (2) of section 1813(a) of the Social 
    Security Act [subsec. (a)(2) of this section] (relating to a 
    deduction for blood).
    ``(b) Transition Provisions for Medicare Beneficiaries.--
        ``(1) Inpatient hospital services and post-hospital extended 
    care services.--In applying sections 1812 and 1813 of the Social 
    Security Act [section 1395d of this title and this section], as 
    restored by subsection (a)(1), with respect to inpatient hospital 
    services and extended care services provided on or after January 1, 
    1990--
            ``(A) no day before January 1, 1990, shall be counted in 
        determining the beginning (or period) of a spell of illness;
            ``(B) with respect to the limitation (other than the 
        limitation under section 1812(c) of such Act [section 1395d(c) 
        of this title]) on such services provided in a spell of illness, 
        days of such services before January 1, 1990, shall not be 
        counted, except that days of inpatient hospital services before 
        January 1, 1989, which were applied with respect to an 
        individual after receiving 90 days of services in a spell of 
        illness (commonly known as `lifetime reserve days') shall be 
        counted;
            ``(C) the limitation of coverage of extended care services 
        to post-hospital extended care services shall not apply to an 
        individual receiving such services from a skilled nursing 
        facility during a continuous period beginning before (and 
        including) January 1, 1990, until the end of the period of 30 
        consecutive days in which the individual is not provided 
        inpatient hospital services or extended care services; and
            ``(D) the inpatient hospital deductible under section 
        1813(a)(1) of such Act [subsec. (a)(1) of this section] shall 
        not apply--
                ``(i) in the case of an individual who is receiving 
            inpatient hospital services during a continuous period 
            beginning before (and including) January 1, 1990, with 
            respect to the spell of illness beginning on such date, if 
            such a deductible was imposed on the individual for a period 
            of hospitalization during 1989;
                ``(ii) for a spell of illness beginning during January 
            1990, if such a deductible was imposed on the individual for 
            a period of hospitalization that began in December 1989; and
                ``(iii) in the case of a spell of illness of an 
            individual that began before January 1, 1990.
        ``(2) Hospice care.--The restoration of section 1812(a)(4) of 
    the Social Security Act [section 1395d(a)(4) of this title], 
    effected by subsection (a)(1), shall not apply to hospice care 
    provided during the subsequent period (described in such section as 
    in effect on December 31, 1989) with respect to which an election 
    has been made before January 1, 1990.''
    [Section 4008(m)(1) of Pub. L. 101-508 provided that amendment by 
that section to section 101(b)(1)(B) of Pub. L. 101-234, set out above, 
is effective as if included in enactment of Medicare Catastrophic 
Coverage Repeal Act of 1989, Pub. L. 101-234.]


   Hold Harmless Provisions; Application of Subsection (a)(1) and (2)

    Section 104(b) of Pub. L. 100-360, as amended by Pub. L. 100-485, 
title VI, Sec. 608(d)(3)(B), Oct. 13, 1988, 102 Stat. 2413; Pub. L. 101-
234, title I, Sec. 101(b)(3), Dec. 13, 1989, 103 Stat. 1980, provided 
that: ``In the case of an individual for whom a spell of illness (as 
defined in section 1861(a) of the Social Security Act [section 1395x(a) 
of this title], as in effect on December 31, 1988) began before January 
1, 1989, and had not yet ended as of such date--
        ``(1)(A) section 1813(a)(1) of such Act [subsec. (a)(1) of this 
    section] (as amended by this subtitle [subtitle A (Secs. 101-104) of 
    title I of Pub. L. 100-360]) shall not apply to services furnished 
    during that spell of illness during 1989, and
        ``(B) if that individual begins a period of hospitalization (as 
    defined in such section) during 1989 after the end of that spell of 
    illness, the first period of hospitalization during 1989 that begins 
    after that spell of illness shall be considered to be (for purposes 
    of such section) the first period of hospitalization that begins 
    during that year; and
        ``(2) the amount of any deductible under section 1813(a)(2) of 
    such Act (as amended by this subtitle) shall be reduced during that 
    spell of illness during 1989 to the extent the deductible under such 
    section was applied during the spell of illness.''


                     Promulgation of New Deductible

    Section 9301(c) of Pub. L. 99-509 directed Secretary of Health and 
Human Services to provide, within 30 days after Oct. 21, 1986, for 
publication of inpatient hospital deductible, coinsurance amounts for 
inpatient hospital services and post-hospital extended care services, 
and monthly part A premiums for 1987, as modified under the amendment of 
this section made by subsection (a).

                  Section Referred to in Other Sections

    This section is referred to in sections 1395f, 1395l, 1395x, 1395cc, 
1395ww, 1395eee, 1396d of this title; title 5 section 8904; title 38 
section 1710.
