Veterans Medicare Reimbursement Demonstration Act of 1997

Veterans Medicare Reimbursement Demonstration Act of 1997 - Directs the Secretaries of Veterans Affairs (VA) and Health and Human Services (HHS) to jointly carry out a demonstration project, during the three-year period beginning on January 1, 1998, under which the HHS Secretary provides the VA with reimbursement from the Medicare program (title XVIII of the Social Security Act) for health-care services provided to targeted Medicare-eligible veterans in or through selected VA medical centers. Provides for the waiver of certain Medicare requirements in order to carry out the project. Requires the VA Secretary to establish a plan for the selection of up to 12 medical centers located in geographically dispersed locations for project participation. Requires at least one medical center selected to be in the same catchment area as a military medical facility which was closed pursuant to a defense base closure law.

Requires project participation to be voluntary. Directs the VA Secretary to establish requirements for participating veterans.

Authorizes the VA Secretary, in carrying out the demonstration project, to operate managed health care plans, either through the VA or public or private entities. Directs the Secretary to prescribe minimum health care benefits to be provided under such plans. Allows the Secretary to establish a managed health care plan only after: (1) reporting to the Congress a plan for the use of such centers and facilities; and (2) receiving from the VA Inspector General certain certifications relating to costs and conformity with health plan requirements.

Requires project reimbursement at a rate equal to 95 percent of amounts that would otherwise be payable under the Medicare program if the facility was not a Federal facility, was participating in the project, and imposed charges for such services. Excludes certain amounts from such computation. Requires reimbursement payments periodically from Medicare trust funds, with an annual Medicare payment limit of $50 million, of which no more than $10 million may be used for the conduct of the project through managed health care plans. Requires reductions in such payments when the amount of the actual VA effort level for targeted veterans for that fiscal year is less than the amount of the VA effort level for FY 1997.

Directs the Secretaries to compare the expenditures made under the project to the expenditures that would have been made for such veterans if the project had not been conducted, and to take appropriate steps if the expenditures under the Medicare program increased as a result of the project. Requires annual reports by the Comptroller General.

Prohibits the VA Secretary from carrying out a demonstration project at a medical center until 30 days after reporting to the Congress on plans for the selection of appropriate centers.

Requires: (1) an independent entity to conduct an ongoing project evaluation and report results to the Secretaries and appropriate congressional committees; and (2) a report from the Secretaries to the Congress on possible project extension and expansion.