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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 1418 Referred in House (RFH)]

109th CONGRESS
  1st Session
                                S. 1418

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           November 18, 2005

            Referred to the Committee on Energy and Commerce

_______________________________________________________________________

                                 AN ACT

 
     To enhance the adoption of a nationwide interoperable health 
information technology system and to improve the quality and reduce the 
               costs of health care in the United States.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Wired for Health Care Quality Act''.

SEC. 2. IMPROVING HEALTH CARE QUALITY, SAFETY, AND EFFICIENCY.

    The Public Health Service Act (42 U.S.C. 201 et seq.) is amended by 
adding at the end the following:

        ``TITLE XXIX--HEALTH INFORMATION TECHNOLOGY AND QUALITY

``SEC. 2901. DEFINITIONS.

    ``In this title:
            ``(1) Health care provider.--The term `health care 
        provider' means a hospital, skilled nursing facility, home 
        health entity, health care clinic, federally qualified health 
        center, group practice (as defined in section 1877(h)(4) of the 
        Social Security Act), a pharmacist, a pharmacy, a laboratory, a 
        physician (as defined in section 1861(r) of the Social Security 
        Act), a practitioner (as defined in section 1842(b)(18)(CC) of 
        the Social Security Act), a health facility operated by or 
        pursuant to a contract with the Indian Health Service, a rural 
        health clinic, and any other category of facility or clinician 
        determined appropriate by the Secretary.
            ``(2) Health information.--The term `health information' 
        has the meaning given such term in section 1171(4) of the 
        Social Security Act.
            ``(3) Health insurance plan.--The term `health insurance 
        plan' means--
                    ``(A) a health insurance issuer (as defined in 
                section 2791(b)(2));
                    ``(B) a group health plan (as defined in section 
                2791(a)(1)); and
                    ``(C) a health maintenance organization (as defined 
                in section 2791(b)(3)).
            ``(4) Individually identifiable health information.--The 
        term `individually identifiable health information' has the 
        meaning given such term in section 1171 of the Social Security 
        Act.
            ``(5) Laboratory.--The term `laboratory' has the meaning 
        given that term in section 353.
            ``(6) Pharmacist.--The term `pharmacist' has the meaning 
        given that term in section 804 of the Federal Food, Drug, and 
        Cosmetic Act.
            ``(7) Qualified health information technology.--The term 
        `qualified health information technology' means a computerized 
        system (including hardware and software) that--
                    ``(A) protects the privacy and security of health 
                information;
                    ``(B) maintains and provides permitted access to 
                health information in an electronic format;
                    ``(C) incorporates decision support to reduce 
                medical errors and enhance health care quality;
                    ``(D) complies with the standards adopted by the 
                Federal Government under section 2903; and
                    ``(E) allows for the reporting of quality measures 
                under section 2907.
            ``(8) State.--The term `State' means each of the several 
        States, the District of Columbia, Puerto Rico, the Virgin 
        Islands, Guam, American Samoa, and the Northern Mariana 
        Islands.

``SEC. 2902. OFFICE OF THE NATIONAL COORDINATOR OF HEALTH INFORMATION 
              TECHNOLOGY.

    ``(a) Office of National Health Information Technology.--There is 
established within the Office of the Secretary an Office of the 
National Coordinator of Health Information Technology (referred to in 
this section as the `Office'). The Office shall be headed by a National 
Coordinator who shall be appointed by the Secretary and shall report 
directly to the Secretary.
    ``(b) Purpose.--It shall be the purpose of the Office to coordinate 
with relevant Federal agencies and private entities and oversee 
programs and activities to develop a nationwide interoperable health 
information technology infrastructure that--
            ``(1) ensures that patients' individually identifiable 
        health information is secure and protected;
            ``(2) improves health care quality, reduces medical errors, 
        and advances the delivery of patient-centered medical care;
            ``(3) reduces health care costs resulting from 
        inefficiency, medical errors, inappropriate care, and 
        incomplete information;
            ``(4) ensures that appropriate information to help guide 
        medical decisions is available at the time and place of care;
            ``(5) promotes a more effective marketplace, greater 
        competition, and increased choice through the wider 
        availability of accurate information on health care costs, 
        quality, and outcomes;
            ``(6) improves the coordination of care and information 
        among hospitals, laboratories, physician offices, and other 
        entities through an effective infrastructure for the secure and 
        authorized exchange of health care information;
            ``(7) improves public health reporting and facilitates the 
        early identification and rapid response to public health 
        threats and emergencies, including bioterror events and 
        infectious disease outbreaks;
            ``(8) facilitates health research; and
            ``(9) promotes prevention of chronic diseases.
    ``(c) Duties of the National Coordinator.--The National Coordinator 
shall--
            ``(1) serve as the principal advisor to the Secretary 
        concerning the development, application, and use of health 
        information technology, and coordinate and oversee the health 
        information technology programs of the Department;
            ``(2) facilitate the adoption of a nationwide, 
        interoperable system for the electronic exchange of health 
        information;
            ``(3) ensure the adoption and implementation of standards 
        for the electronic exchange of health information to reduce 
        cost and improve health care quality;
            ``(4) ensure that health information technology policy and 
        programs of the Department are coordinated with those of 
        relevant executive branch agencies (including Federal 
        commissions) with a goal of avoiding duplication of efforts and 
        of helping to ensure that each agency undertakes health 
        information technology activities primarily within the areas of 
        its greatest expertise and technical capability;
            ``(5) to the extent permitted by law, coordinate outreach 
        and consultation by the relevant executive branch agencies 
        (including Federal commissions) with public and private parties 
        of interest, including consumers, payers, employers, hospitals 
        and other health care providers, physicians, community health 
        centers, laboratories, vendors and other stakeholders;
            ``(6) advise the President regarding specific Federal 
        health information technology programs; and
            ``(7) prepare the reports described under section 2903(i) 
        (excluding paragraph (4) of such section).
    ``(d) Detail of Federal Employees.--
            ``(1) In general.--Upon the request of the National 
        Coordinator, the head of any Federal agency is authorized to 
        detail, with or without reimbursement from the Office, any of 
        the personnel of such agency to the Office to assist it in 
        carrying out its duties under this section.
            ``(2) Effect of detail.--Any detail of personnel under 
        paragraph (1) shall--
                    ``(A) not interrupt or otherwise affect the civil 
                service status or privileges of the Federal employee; 
                and
                    ``(B) be in addition to any other staff of the 
                Department employed by the National Coordinator.
            ``(3) Acceptance of detailees.--Notwithstanding any other 
        provision of law, the Office may accept detailed personnel from 
        other Federal agencies without regard to whether the agency 
        described under paragraph (1) is reimbursed.
    ``(e) Rule of Construction.--Nothing in this section shall be 
construed to require the duplication of Federal efforts with respect to 
the establishment of the Office, regardless of whether such efforts 
were carried out prior to or after the enactment of this title.
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, $5,000,000 for fiscal year 
2006, $5,000,000 for fiscal year 2007, and such sums as may be 
necessary for each of fiscal years 2008 through 2010.

``SEC. 2903. AMERICAN HEALTH INFORMATION COLLABORATIVE.

    ``(a) Purpose.--The Secretary shall establish the public-private 
American Health Information Collaborative (referred to in this section 
as the `Collaborative') to--
            ``(1) advise the Secretary and recommend specific actions 
        to achieve a nationwide interoperable health information 
        technology infrastructure;
            ``(2) serve as a forum for the participation of a broad 
        range of stakeholders to provide input on achieving the 
        interoperability of health information technology; and
            ``(3) recommend standards (including content, 
        communication, and security standards) for the electronic 
        exchange of health information (including for the reporting of 
        quality data under section 2907) for adoption by the Federal 
        Government and voluntary adoption by private entities.
    ``(b) Composition.--
            ``(1) In general.--The Collaborative shall be composed of 
        members of the public and private sectors to be appointed by 
        the Secretary, including representatives from--
                    ``(A) consumer or patient organizations;
                    ``(B) organizations with expertise in privacy and 
                security;
                    ``(C) health care providers;
                    ``(D) health insurance plans or other third party 
                payors;
                    ``(E) information technology vendors; and
                    ``(F) purchasers or employers.
            ``(2) Participation.--In appointing members under paragraph 
        (1), and in developing the procedures for conducting the 
        activities of the Collaborative, the Secretary shall ensure a 
        balance among various sectors of the health care system so that 
        no single sector unduly influences the recommendations of the 
        Collaborative.
            ``(3) Terms.--Members appointed under paragraph (1) shall 
        serve for 2 year terms, except that any member appointed to 
        fill a vacancy for an unexpired term shall be appointed for the 
        remainder of such term. A member may serve for not to exceed 
        180 days after the expiration of such member's term or until a 
        successor has been appointed.
            ``(4) Outside involvement.--With respect to the functions 
        of the Collaborative, the Secretary shall ensure an adequate 
        opportunity for the participation of outside advisors, 
        including individuals with expertise in--
                    ``(A) health information privacy;
                    ``(B) health information security;
                    ``(C) health care quality and patient safety, 
                including individuals with expertise in utilizing 
                health information technology to improve health care 
                quality and patient safety;
                    ``(D) data exchange; and
                    ``(E) developing health information technology 
                standards and new health information technology.
    ``(c) Recommendations and Policies.--Not later than 1 year after 
the date of enactment of this title, and annually thereafter, the 
Collaborative shall recommend to the Secretary uniform national 
policies for adoption by the Federal Government and voluntary adoption 
by private entities to support the widespread adoption of health 
information technology, including--
            ``(1) protection of individually identifiable health 
        information through privacy and security practices;
            ``(2) measures to prevent unauthorized access to health 
        information, including unauthorized access through the use of 
        certain peer-to-peer file-sharing applications;
            ``(3) methods to notify patients if their individually 
        identifiable health information is wrongfully disclosed;
            ``(4) methods to facilitate secure patient access to health 
        information;
            ``(5) fostering the public understanding of health 
        information technology;
            ``(6) the ongoing harmonization of industry-wide health 
        information technology standards;
            ``(7) recommendations for a nationwide interoperable health 
        information technology infrastructure;
            ``(8) the identification and prioritization of specific use 
        cases for which health information technology is valuable, 
        beneficial, and feasible;
            ``(9) recommendations for the establishment of an entity to 
        ensure the continuation of the functions of the Collaborative; 
        and
            ``(10) other policies (including recommendations for 
        incorporating health information technology into the provision 
        of care and the organization of the health care workplace) 
        determined to be necessary by the Collaborative.
    ``(d) Standards.--
            ``(1) Existing standards.--The standards adopted by the 
        Consolidated Health Informatics Initiative shall be deemed to 
        have been recommended by the Collaborative under this section.
            ``(2) First year review.--Not later than 1 year after the 
        date of enactment of this title, the Collaborative shall--
                    ``(A) review existing standards (including content, 
                communication, and security standards) for the 
                electronic exchange of health information;
                    ``(B) identify deficiencies and omissions in such 
                existing standards; and
                    ``(C) identify duplication and overlap in such 
                existing standards;
        and recommend new standards and modifications to such existing 
        standards as necessary.
            ``(3) Ongoing review.--Beginning 1 year after the date of 
        enactment of this title, and annually thereafter, the 
        Collaborative shall--
                    ``(A) review existing standards (including content, 
                communication, and security standards) for the 
                electronic exchange of health information;
                    ``(B) identify deficiencies and omissions in such 
                existing standards; and
                    ``(C) identify duplication and overlap in such 
                existing standards;
        and recommend new standards and modifications to such existing 
        standards as necessary.
            ``(4) Limitation.--The standards and timeframe for adoption 
        described in this section shall be consistent with any 
        standards developed pursuant to the Health Insurance 
        Portability and Accountability Act of 1996.
    ``(e) Federal Action.--Not later than 90 days after the issuance of 
a recommendation from the Collaborative under subsection (d)(2), the 
Secretary of Health and Human Services, the Secretary of Veterans 
Affairs, and the Secretary of Defense, in collaboration with 
representatives of other relevant Federal agencies, as determined 
appropriate by the Secretary, shall jointly review such 
recommendations. If appropriate, the Secretary shall provide for the 
adoption by the Federal Government of any standard or standards 
contained in such recommendation.
    ``(f) Coordination of Federal Spending.--
            ``(1) In general.--Not later than 1 year after the adoption 
        by the Federal Government of a recommendation as provided for 
        in subsection (e), and in compliance with chapter 113 of title 
        40, United States Code, no Federal agency shall expend Federal 
        funds for the purchase of any new health information technology 
        or health information technology system for clinical care or 
        for the electronic retrieval, storage, or exchange of health 
        information that is not consistent with applicable standards 
        adopted by the Federal Government under subsection (e).
            ``(2) Rule of construction.--Nothing in paragraph (1) shall 
        be construed to restrict the purchase of minor (as determined 
        by the Secretary) hardware or software components in order to 
        modify, correct a deficiency in, or extend the life of existing 
        hardware or software.
    ``(g) Coordination of Federal Data Collection.--Not later than 3 
years after the adoption by the Federal Government of a recommendation 
as provided for in subsection (e), all Federal agencies collecting 
health data for the purposes of quality reporting, surveillance, 
epidemiology, adverse event reporting, research, or for other purposes 
determined appropriate by the Secretary, shall comply with standards 
adopted under subsection (e).
    ``(h) Voluntary Adoption.--
            ``(1) In general.--Any standards adopted by the Federal 
        Government under subsection (e) shall be voluntary with respect 
        to private entities.
            ``(2) Rule of construction.--Nothing in this section shall 
        be construed to require that a private entity that enters into 
        a contract with the Federal Government adopt the standards 
        adopted by the Federal Government under this section with 
        respect to activities not related to the contract.
            ``(3) Limitation.--Private entities that enter into a 
        contract with the Federal Government shall adopt the standards 
        adopted by the Federal Government under this section for the 
        purpose of activities under such Federal contract.
    ``(i) Reports.--The Secretary shall submit to the Committee on 
Health, Education, Labor, and Pensions and the Committee on Finance of 
the Senate and the Committee on Energy and Commerce and the Committee 
on Ways and Means of the House of Representatives, on an annual basis, 
a report that--
            ``(1) describes the specific actions that have been taken 
        by the Federal Government and private entities to facilitate 
        the adoption of an interoperable nationwide system for the 
        electronic exchange of health information;
            ``(2) describes barriers to the adoption of such a 
        nationwide system;
            ``(3) contains recommendations to achieve full 
        implementation of such a nationwide system; and
            ``(4) contains a plan and progress toward the establishment 
        of an entity to ensure the continuation of the functions of the 
        Collaborative.
    ``(j) Application of FACA.--The Federal Advisory Committee Act (5 
U.S.C. App.) shall apply to the Collaborative, except that the term 
provided for under section 14(a)(2) shall be 5 years.
    ``(k) Rule of Construction.--Nothing in this section shall be 
construed to require the duplication of Federal efforts with respect to 
the establishment of the Collaborative, regardless of whether such 
efforts were carried out prior to or after the enactment of this title.
    ``(l) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, $4,000,000 for fiscal year 
2006, $4,000,000 for fiscal year 2007, and such sums as may be 
necessary for each of fiscal years 2008 through 2010.

``SEC. 2904. IMPLEMENTATION AND CERTIFICATION OF HEALTH INFORMATION 
              STANDARDS.

    ``(a) Implementation.--
            ``(1) In general.--The Secretary, based upon the 
        recommendations of the Collaborative, shall develop criteria to 
        ensure uniform and consistent implementation of any standards 
        for the electronic exchange of health information voluntarily 
        adopted by private entities in technical conformance with such 
        standards adopted under this title.
            ``(2) Implementation assistance.--The Secretary may 
        recognize a private entity or entities to assist private 
        entities in the implementation of the standards adopted under 
        this title using the criteria developed by the Secretary under 
        this section.
    ``(b) Certification.--
            ``(1) In general.--The Secretary, based upon the 
        recommendations of the Collaborative, shall develop criteria to 
        ensure and certify that hardware and software that claim to be 
        in compliance with applicable standards for the electronic 
        exchange of health information adopted under this title have 
        established and maintained such compliance in technical 
        conformance with such standards.
            ``(2) Certification assistance.--The Secretary may 
        recognize a private entity or entities to assist in the 
        certification described under paragraph (1) using the criteria 
        developed by the Secretary under this section.
    ``(c) Outside Involvement.--The Secretary, through consultation 
with the Collaborative, may accept recommendations on the development 
of the criteria under subsections (a) and (b) from a Federal agency or 
private entity.

``SEC. 2905. GRANTS TO FACILITATE THE WIDESPREAD ADOPTION OF 
              INTEROPERABLE HEALTH INFORMATION TECHNOLOGY.

    ``(a) Competitive Grants to Facilitate the Widespread Adoption of 
Health Information Technology.--
            ``(1) In general.--The Secretary may award competitive 
        grants to eligible entities to facilitate the purchase and 
        enhance the utilization of qualified health information 
        technology systems to improve the quality and efficiency of 
        health care.
            ``(2) Eligibility.--To be eligible to receive a grant under 
        paragraph (1) an entity shall--
                    ``(A) submit to the Secretary an application at 
                such time, in such manner, and containing such 
                information as the Secretary may require;
                    ``(B) submit to the Secretary a strategic plan for 
                the implementation of data sharing and interoperability 
                measures;
                    ``(C) be a--
                            ``(i) not for profit hospital, including a 
                        federally qualified health center (as defined 
                        in section 1861(aa)(4) of the Social Security 
                        Act);
                            ``(ii) individual or group practice; or
                            ``(iii) another health care provider not 
                        described in clause (i) or (ii);
                    ``(D) adopt the standards adopted by the Federal 
                Government under section 2903;
                    ``(E) implement the measures adopted under section 
                2907 and report to the Secretary on such measures;
                    ``(F) agree to notify patients if their 
                individually identifiable health information is 
                wrongfully disclosed;
                    ``(G) demonstrate significant financial need; and
                    ``(H) provide matching funds in accordance with 
                paragraph (4).
            ``(3) Use of funds.--Amounts received under a grant under 
        this subsection shall be used to facilitate the purchase and 
        enhance the utilization of qualified health information 
        technology systems and training personnel in the use of such 
        technology.
            ``(4) Matching requirement.--To be eligible for a grant 
        under this subsection an entity shall contribute non-Federal 
        contributions to the costs of carrying out the activities for 
        which the grant is awarded in an amount equal to $1 for each $3 
        of Federal funds provided under the grant.
            ``(5) Preference in awarding grants.--In awarding grants 
        under this subsection the Secretary shall give preference to--
                    ``(A) eligible entities that are located in rural, 
                frontier, and other underserved areas as determined by 
                the Secretary;
                    ``(B) eligible entities that will link, to the 
                extent practicable, the qualified health information 
                system to local or regional health information plan or 
                plans; and
                    ``(C) with respect to an entity described in 
                subsection (a)(2)(C)(iii), a nonprofit health care 
                provider.
    ``(b) Competitive Grants to States for the Development of State 
Loan Programs to Facilitate the Widespread Adoption of Health 
Information Technology.--
            ``(1) In general.--The Secretary may award competitive 
        grants to States for the establishment of State programs for 
        loans to health care providers to facilitate the purchase and 
        enhance the utilization of qualified health information 
        technology.
            ``(2) Establishment of fund.--To be eligible to receive a 
        competitive grant under this subsection, a State shall 
        establish a qualified health information technology loan fund 
        (referred to in this subsection as a `State loan fund') and 
        comply with the other requirements contained in this section. A 
        grant to a State under this subsection shall be deposited in 
        the State loan fund established by the State. No funds 
        authorized by other provisions of this title to be used for 
        other purposes specified in this title shall be deposited in 
        any State loan fund.
            ``(3) Eligibility.--To be eligible to receive a grant under 
        paragraph (1) a State shall--
                    ``(A) submit to the Secretary an application at 
                such time, in such manner, and containing such 
                information as the Secretary may require;
                    ``(B) submit to the Secretary a strategic plan in 
                accordance with paragraph (4);
                    ``(C) establish a qualified health information 
                technology loan fund in accordance with paragraph (2);
                    ``(D) require that health care providers receiving 
                such loans--
                            ``(i) link, to the extent practicable, the 
                        qualified health information system to a local 
                        or regional health information network;
                            ``(ii) consult with the Health Information 
                        Technology Resource Center established in 
                        section 914(d) to access the knowledge and 
                        experience of existing initiatives regarding 
                        the successful implementation and effective use 
                        of health information technology; and
                            ``(iii) agree to notify patients if their 
                        individually identifiable health information is 
                        wrongfully disclosed;
                    ``(E) require that health care providers receiving 
                such loans adopt the standards adopted by the Federal 
                Government under section 2903;
                    ``(F) require that health care providers receiving 
                such loans implement the measures adopted under section 
                2907 and report to the Secretary on such measures; and
                    ``(G) provide matching funds in accordance with 
                paragraph (8).
            ``(4) Strategic plan.--
                    ``(A) In general.--A State that receives a grant 
                under this subsection shall annually prepare a 
                strategic plan that identifies the intended uses of 
                amounts available to the State loan fund of the State.
                    ``(B) Contents.--A strategic plan under 
                subparagraph (A) shall include--
                            ``(i) a list of the projects to be assisted 
                        through the State loan fund in the first fiscal 
                        year that begins after the date on which the 
                        plan is submitted;
                            ``(ii) a description of the criteria and 
                        methods established for the distribution of 
                        funds from the State loan fund; and
                            ``(iii) a description of the financial 
                        status of the State loan fund and the short-
                        term and long-term goals of the State loan 
                        fund.
            ``(5) Use of funds.--
                    ``(A) In general.--Amounts deposited in a State 
                loan fund, including loan repayments and interest 
                earned on such amounts, shall be used only for awarding 
                loans or loan guarantees, or as a source of reserve and 
                security for leveraged loans, the proceeds of which are 
                deposited in the State loan fund established under 
                paragraph (1). Loans under this section may be used by 
                a health care provider to facilitate the purchase and 
                enhance the utilization of qualified health information 
                technology and training of personnel in the use of such 
                technology.
                    ``(B) Limitation.--Amounts received by a State 
                under this subsection may not be used--
                            ``(i) for the purchase or other acquisition 
                        of any health information technology system 
                        that is not a qualified health information 
                        technology system;
                            ``(ii) to conduct activities for which 
                        Federal funds are expended under this title, or 
                        the amendments made by the Wired for Health 
                        Care Quality Act; or
                            ``(iii) for any purpose other than making 
                        loans to eligible entities under this section.
            ``(6) Types of assistance.--Except as otherwise limited by 
        applicable State law, amounts deposited into a State loan fund 
        under this subsection may only be used for the following:
                    ``(A) To award loans that comply with the 
                following:
                            ``(i) The interest rate for each loan shall 
                        be less than or equal to the market interest 
                        rate.
                            ``(ii) The principal and interest payments 
                        on each loan shall commence not later than 1 
                        year after the loan was awarded, and each loan 
                        shall be fully amortized not later than 10 
                        years after the date of the loan.
                            ``(iii) The State loan fund shall be 
                        credited with all payments of principal and 
                        interest on each loan awarded from the fund.
                    ``(B) To guarantee, or purchase insurance for, a 
                local obligation (all of the proceeds of which finance 
                a project eligible for assistance under this 
                subsection) if the guarantee or purchase would improve 
                credit market access or reduce the interest rate 
                applicable to the obligation involved.
                    ``(C) As a source of revenue or security for the 
                payment of principal and interest on revenue or general 
                obligation bonds issued by the State if the proceeds of 
                the sale of the bonds will be deposited into the State 
                loan fund.
                    ``(D) To earn interest on the amounts deposited 
                into the State loan fund.
            ``(7) Administration of state loan funds.--
                    ``(A) Combined financial administration.--A State 
                may (as a convenience and to avoid unnecessary 
                administrative costs) combine, in accordance with State 
                law, the financial administration of a State loan fund 
                established under this subsection with the financial 
                administration of any other revolving fund established 
                by the State if otherwise not prohibited by the law 
                under which the State loan fund was established.
                    ``(B) Cost of administering fund.--Each State may 
                annually use not to exceed 4 percent of the funds 
                provided to the State under a grant under this 
                subsection to pay the reasonable costs of the 
                administration of the programs under this section, 
                including the recovery of reasonable costs expended to 
                establish a State loan fund which are incurred after 
                the date of enactment of this title.
                    ``(C) Guidance and regulations.--The Secretary 
                shall publish guidance and promulgate regulations as 
                may be necessary to carry out the provisions of this 
                subsection, including--
                            ``(i) provisions to ensure that each State 
                        commits and expends funds allotted to the State 
                        under this subsection as efficiently as 
                        possible in accordance with this title and 
                        applicable State laws; and
                            ``(ii) guidance to prevent waste, fraud, 
                        and abuse.
                    ``(D) Private sector contributions.--
                            ``(i) In general.--A State loan fund 
                        established under this subsection may accept 
                        contributions from private sector entities, 
                        except that such entities may not specify the 
                        recipient or recipients of any loan issued 
                        under this subsection.
                            ``(ii) Availability of information.--A 
                        State shall make publicly available the 
                        identity of, and amount contributed by, any 
                        private sector entity under clause (i) and may 
                        issue letters of commendation or make other 
                        awards (that have no financial value) to any 
                        such entity.
            ``(8) Matching requirements.--
                    ``(A) In general.--The Secretary may not make a 
                grant under paragraph (1) to a State unless the State 
                agrees to make available (directly or through donations 
                from public or private entities) non-Federal 
                contributions in cash toward the costs of the State 
                program to be implemented under the grant in an amount 
                equal to not less than $1 for each $1 of Federal funds 
                provided under the grant.
                    ``(B) Determination of amount of non-federal 
                contribution.--In determining the amount of non-Federal 
                contributions that a State has provided pursuant to 
                subparagraph (A), the Secretary may not include any 
                amounts provided to the State by the Federal 
                Government.
            ``(9) Preference in awarding grants.--The Secretary may 
        give a preference in awarding grants under this subsection to 
        States that adopt value-based purchasing programs to improve 
        health care quality.
            ``(10) Reports.--The Secretary shall annually submit to the 
        Committee on Health, Education, Labor, and Pensions and the 
        Committee on Finance of the Senate, and the Committee on Energy 
        and Commerce and the Committee on Ways and Means of the House 
        of Representatives, a report summarizing the reports received 
        by the Secretary from each State that receives a grant under 
        this subsection.
    ``(c) Competitive Grants for the Implementation of Regional or 
Local Health Information Technology Plans.--
            ``(1) In general.--The Secretary may award competitive 
        grants to eligible entities to implement regional or local 
        health information plans to improve health care quality and 
        efficiency through the electronic exchange of health 
        information pursuant to the standards, protocols, and other 
        requirements adopted by the Secretary under sections 2903 and 
        2907.
            ``(2) Eligibility.--To be eligible to receive a grant under 
        paragraph (1) an entity shall--
                    ``(A) demonstrate financial need to the Secretary;
                    ``(B) demonstrate that one of its principal 
                missions or purposes is to use information technology 
                to improve health care quality and efficiency;
                    ``(C) adopt bylaws, memoranda of understanding, or 
                other charter documents that demonstrate that the 
                governance structure and decisionmaking processes of 
                such entity allow for participation on an ongoing basis 
                by multiple stakeholders within a community, 
                including--
                            ``(i) physicians (as defined in section 
                        1861(r) of the Social Security Act), including 
                        physicians that provide services to low income 
                        and underserved populations;
                            ``(ii) hospitals (including hospitals that 
                        provide services to low income and underserved 
                        populations);
                            ``(iii) pharmacists or pharmacies;
                            ``(iv) health insurance plans;
                            ``(v) health centers (as defined in section 
                        330(b)) and Federally qualified health centers 
                        (as defined in section 1861(aa)(4) of the 
                        Social Security Act);
                            ``(vi) rural health clinics (as defined in 
                        section 1861(aa) of the Social Security Act);
                            ``(vii) patient or consumer organizations;
                            ``(viii) employers; and
                            ``(ix) any other health care providers or 
                        other entities, as determined appropriate by 
                        the Secretary;
                    ``(D) demonstrate the participation, to the extent 
                practicable, of stakeholders in the electronic exchange 
                of health information within the local or regional plan 
                pursuant to paragraph (2)(C);
                    ``(E) adopt nondiscrimination and conflict of 
                interest policies that demonstrate a commitment to 
                open, fair, and nondiscriminatory participation in the 
                health information plan by all stakeholders;
                    ``(F) adopt the standards adopted by the Secretary 
                under section 2903;
                    ``(G) require that health care providers receiving 
                such grants implement the measures adopted under 
                section 2907 and report to the Secretary on such 
                measures;
                    ``(H) agree to notify patients if their 
                individually identifiable health information is 
                wrongfully disclosed;
                    ``(I) facilitate the electronic exchange of health 
                information within the local or regional area and among 
                local and regional areas;
                    ``(J) prepare and submit to the Secretary an 
                application in accordance with paragraph (3); and
                    ``(K) agree to provide matching funds in accordance 
                with paragraph (5).
            ``(3) Application.--
                    ``(A) In general.--To be eligible to receive a 
                grant under paragraph (1), an entity shall submit to 
                the Secretary an application at such time, in such 
                manner, and containing such information as the 
                Secretary may require.
                    ``(B) Required information.--At a minimum, an 
                application submitted under this paragraph shall 
                include--
                            ``(i) clearly identified short-term and 
                        long-term objectives of the regional or local 
                        health information plan;
                            ``(ii) a technology plan that complies with 
                        the standards adopted under section 2903 and 
                        that includes a descriptive and reasoned 
                        estimate of costs of the hardware, software, 
                        training, and consulting services necessary to 
                        implement the regional or local health 
                        information plan;
                            ``(iii) a strategy that includes 
                        initiatives to improve health care quality and 
                        efficiency, including the use and reporting of 
                        health care quality measures adopted under 
                        section 2907;
                            ``(iv) a plan that describes provisions to 
                        encourage the implementation of the electronic 
                        exchange of health information by all 
                        physicians, including single physician 
                        practices and small physician groups 
                        participating in the health information plan;
                            ``(v) a plan to ensure the privacy and 
                        security of personal health information that is 
                        consistent with Federal and State law;
                            ``(vi) a governance plan that defines the 
                        manner in which the stakeholders shall jointly 
                        make policy and operational decisions on an 
                        ongoing basis;
                            ``(vii) a financial or business plan that 
                        describes--
                                    ``(I) the sustainability of the 
                                plan;
                                    ``(II) the financial costs and 
                                benefits of the plan; and
                                    ``(III) the entities to which such 
                                costs and benefits will accrue; and
                            ``(viii) in the case of an applicant entity 
                        that is unable to demonstrate the participation 
                        of all stakeholders pursuant to paragraph 
                        (2)(C), the justification from the entity for 
                        any such nonparticipation.
            ``(4) Use of funds.--Amounts received under a grant under 
        paragraph (1) shall be used to establish and implement a 
        regional or local health information plan in accordance with 
        this subsection.
            ``(5) Matching requirement.--
                    ``(A) In general.--The Secretary may not make a 
                grant under this subsection to an entity unless the 
                entity agrees that, with respect to the costs to be 
                incurred by the entity in carrying out the 
                infrastructure program for which the grant was awarded, 
                the entity will make available (directly or through 
                donations from public or private entities) non-Federal 
                contributions toward such costs in an amount equal to 
                not less than 50 percent of such costs ($1 for each $2 
                of Federal funds provided under the grant).
                    ``(B) Determination of amount contributed.--Non-
                Federal contributions required under subparagraph (A) 
                may be in cash or in kind, fairly evaluated, including 
                equipment, technology, or services. Amounts provided by 
                the Federal Government, or services assisted or 
                subsidized to any significant extent by the Federal 
                Government, may not be included in determining the 
                amount of such non-Federal contributions.
    ``(d) Reports.--Not later than 1 year after the date on which the 
first grant is awarded under this section, and annually thereafter 
during the grant period, an entity that receives a grant under this 
section shall submit to the Secretary a report on the activities 
carried out under the grant involved. Each such report shall include--
            ``(1) a description of the financial costs and benefits of 
        the project involved and of the entities to which such costs 
        and benefits accrue;
            ``(2) an analysis of the impact of the project on health 
        care quality and safety;
            ``(3) a description of any reduction in duplicative or 
        unnecessary care as a result of the project involved;
            ``(4) a description of the efforts of recipients under this 
        section to facilitate secure patient access to health 
        information; and
            ``(5) other information as required by the Secretary.
    ``(e) Requirement To Achieve Quality Improvement.--The Secretary 
shall annually evaluate the activities conducted under this section and 
shall, in awarding grants, implement the lessons learned from such 
evaluation in a manner so that awards made subsequent to each such 
evaluation are made in a manner that, in the determination of the 
Secretary, will result in the greatest improvement in quality measures 
under section 2907.
    ``(f) Limitation.--An eligible entity may only receive one non-
renewable grant under subsection (a), one non-renewable grant under 
subsection (b), and one non-renewable grant under subsection (c).
    ``(g) Authorization of Appropriations.--
            ``(1) In general.--For the purpose of carrying out this 
        section, there is authorized to be appropriated $116,000,000 
        for fiscal year 2006, $141,000,000 for fiscal year 2007, and 
        such sums as may be necessary for each of fiscal years 2008 
        through 2010.
            ``(2) Availability.--Amounts appropriated under paragraph 
        (1) shall remain available through fiscal year 2010.

``SEC. 2906. DEMONSTRATION PROGRAM TO INTEGRATE INFORMATION TECHNOLOGY 
              INTO CLINICAL EDUCATION.

    ``(a) In General.--The Secretary may award grants under this 
section to carry out demonstration projects to develop academic 
curricula integrating qualified health information technology systems 
in the clinical education of health professionals. Such awards shall be 
made on a competitive basis and pursuant to peer review.
    ``(b) Eligibility.--To be eligible to receive a grant under 
subsection (a), an entity shall--
            ``(1) submit to the Secretary an application at such time, 
        in such manner, and containing such information as the 
        Secretary may require;
            ``(2) submit to the Secretary a strategic plan for 
        integrating qualified health information technology in the 
        clinical education of health professionals and for ensuring the 
        consistent utilization of decision support software to reduce 
        medical errors and enhance health care quality;
            ``(3) be--
                    ``(A) a health professions school;
                    ``(B) a school of nursing; or
                    ``(C) an institution with a graduate medical 
                education program;
            ``(4) provide for the collection of data regarding the 
        effectiveness of the demonstration project to be funded under 
        the grant in improving the safety of patients, the efficiency 
        of health care delivery, and in increasing the likelihood that 
        graduates of the grantee will adopt and incorporate health 
        information technology, and implement the quality measures 
        adopted under section 2907, in the delivery of health care 
        services; and
            ``(5) provide matching funds in accordance with subsection 
        (c).
    ``(c) Use of Funds.--
            ``(1) In general.--With respect to a grant under subsection 
        (a), an eligible entity shall--
                    ``(A) use grant funds in collaboration with 2 or 
                more disciplines; and
                    ``(B) use grant funds to integrate qualified health 
                information technology into community-based clinical 
                education.
            ``(2) Limitation.--An eligible entity shall not use amounts 
        received under a grant under subsection (a) to purchase 
        hardware, software, or services.
    ``(d) Matching Funds.--
            ``(1) In general.--The Secretary may award a grant to an 
        entity under this section only if the entity agrees to make 
        available non-Federal contributions toward the costs of the 
        program to be funded under the grant in an amount that is not 
        less than $1 for each $2 of Federal funds provided under the 
        grant.
            ``(2) Determination of amount contributed.--Non-Federal 
        contributions under paragraph (1) may be in cash or in kind, 
        fairly evaluated, including equipment or services. Amounts 
        provided by the Federal Government, or services assisted or 
        subsidized to any significant extent by the Federal Government, 
        may not be included in determining the amount of such 
        contributions.
    ``(e) Evaluation.--The Secretary shall take such action as may be 
necessary to evaluate the projects funded under this section and 
publish, make available, and disseminate the results of such 
evaluations on as wide a basis as is practicable.
    ``(f) Reports.--Not later than 1 year after the date of enactment 
of this title, and annually thereafter, the Secretary shall submit to 
the Committee on Health, Education, Labor, and Pensions and the 
Committee on Finance of the Senate, and the Committee on Energy and 
Commerce and the Committee on Ways and Means of the House of 
Representatives a report that--
            ``(1) describes the specific projects established under 
        this section; and
            ``(2) contains recommendations for Congress based on the 
        evaluation conducted under subsection (e).
    ``(g) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section, $5,000,000 for fiscal year 
2007, and such sums as may be necessary for each of fiscal years 2008 
through 2010.
    ``(h) Sunset.--This section shall not apply after September 30, 
2010.

``SEC. 2907. QUALITY MEASURES.

    ``(a) In General.--The Secretary shall develop quality measures, 
including measures to assess the effectiveness, timeliness, patient 
self-management, patient centeredness, efficiency, and safety, for the 
purpose of measuring the quality of care patients receive.
    ``(b) Requirements.--The Secretary shall ensure that the quality 
measures developed under this section comply with the following:
            ``(1) Measures.--
                    ``(A) Requirements.--In developing the quality 
                measures under this section, the Secretary shall, to 
                the extent feasible, ensure that--
                            ``(i) such measures are evidence based, 
                        reliable, and valid;
                            ``(ii) such measures are consistent with 
                        the purposes described in section 2902(b);
                            ``(iii) such measures include measures of 
                        clinical processes and outcomes, patient 
                        experience, efficiency, and equity; and
                            ``(iv) such measures include measures of 
                        overuse and underuse of health care items and 
                        services.
            ``(2) Priorities.--In developing the quality measures under 
        this section, the Secretary shall ensure that priority is given 
        to--
                    ``(A) measures with the greatest potential impact 
                for improving the quality and efficiency of care 
                provided under this Act;
                    ``(B) measures that may be rapidly implemented by 
                group health plans, health insurance issuers, 
                physicians, hospitals, nursing homes, long-term care 
                providers, and other providers; and
                    ``(C) measures which may inform health care 
                decisions made by consumers and patients.
            ``(3) Risk adjustment.--The Secretary shall establish 
        procedures to account for differences in patient health status, 
        patient characteristics, and geographic location. To the extent 
        practicable, such procedures shall recognize existing 
        procedures.
            ``(4) Maintenance.--The Secretary shall, as determined 
        appropriate, but in no case more often than once during each 
        12-month period, update the quality measures, including through 
        the addition of more accurate and precise measures and the 
        retirement of existing outdated measures.
            ``(5) Relationship with programs under the social security 
        act.--The Secretary shall ensure that the quality measures 
        developed under this section--
                    ``(A) complement quality measures developed by the 
                Secretary under programs administered by the Secretary 
                under the Social Security Act, including programs under 
                titles XVIII, XIX, and XXI of such Act; and
                    ``(B) do not conflict with the needs and priorities 
                of the programs under titles XVIII, XIX, and XXI of 
                such Act, as set forth by the Administrator of the 
                Centers for Medicare & Medicaid Services.
    ``(c) Required Considerations in Developing and Updating the 
Measures.--In developing and updating the quality measures under this 
section, the Secretary may take into account--
            ``(1) any demonstration or pilot program conducted by the 
        Secretary relating to measuring and rewarding quality and 
        efficiency of care;
            ``(2) any existing activities conducted by the Secretary 
        relating to measuring and rewarding quality and efficiency;
            ``(3) any existing activities conducted by private 
        entities, including health insurance plans and payors;
            ``(4) the report by the Institute of Medicine of the 
        National Academy of Sciences under section 238(b) of the 
        Medicare Prescription Drug, Improvement, and Modernization Act 
        of 2003; and
            ``(5) issues of data collection and reporting, including 
        the feasibility of collecting and reporting data on measures.
    ``(d) Solicitation of Advice and Recommendations.--On and after 
July 1, 2006, the Secretary shall consult with the following regarding 
the development, updating, and use of quality measures developed under 
this section:
            ``(1) Health insurance plans and health care providers, 
        including such plans and providers with experience in the care 
        of the frail elderly and individuals with multiple complex 
        chronic conditions, or groups representing such health 
        insurance plans and providers.
            ``(2) Groups representing patients and consumers.
            ``(3) Purchasers and employers or groups representing 
        purchasers or employers.
            ``(4) Organizations that focus on quality improvement as 
        well as the measurement and reporting of quality measures.
            ``(5) Organizations that certify and license health care 
        providers.
            ``(6) State government public health programs.
            ``(7) Individuals or entities skilled in the conduct and 
        interpretation of biomedical, health services, and health 
        economics research and with expertise in outcomes and 
        effectiveness research and technology assessment.
            ``(8) Individuals or entities involved in the development 
        and establishment of standards and certification for health 
        information technology systems and clinical data.
            ``(9) Individuals or entities with experience with--
                    ``(A) urban health care issues;
                    ``(B) safety net health care issues; and
                    ``(C) rural and frontier health care issues.
    ``(e) Use of Quality Measures.--
            ``(1) In general.--For purposes of activities conducted or 
        supported by the Secretary under this Act, the Secretary shall, 
        to the extent practicable, adopt and utilize the quality 
        measures developed under this section.
            ``(2) Collaborative agreements.--With respect to activities 
        conducted or supported by the Secretary under this Act, the 
        Secretary may establish collaborative agreements with private 
        entities, including group health plans and health insurance 
        issuers, providers, purchasers, consumer organizations, and 
        entities receiving a grant under section 2905, to--
                    ``(A) encourage the use of the quality measures 
                adopted by the Secretary under this section; and
                    ``(B) foster uniformity between the health care 
                quality measures utilized by private entities.
            ``(3) Reporting.--The Secretary shall implement procedures 
        to enable the Department of Health and Human Services to accept 
        the electronic submission of data for purposes of--
                    ``(A) quality measurement using the quality 
                measures developed under this section and using the 
                standards adopted by the Federal Government under 
                section 2903; and
                    ``(B) for reporting measures used to make value-
                based payments under programs under the Social Security 
                Act.
    ``(f) Dissemination of Information.--Beginning on January 1, 2008, 
in order to make comparative quality information available to health 
care consumers, health professionals, public health officials, 
researchers, and other appropriate individuals and entities, the 
Secretary shall provide for the dissemination, aggregation, and 
analysis of quality measures collected under section 2905 and the 
dissemination of recommendations and best practices derived in part 
from such analysis.
    ``(g) Technical Assistance.--The Secretary shall provide technical 
assistance to public and private entities to enable such entities to--
            ``(1) implement and use evidence-based guidelines with the 
        greatest potential to improve health care quality, efficiency, 
        and patient safety; and
            ``(2) establish mechanisms for the rapid dissemination of 
        information regarding evidence-based guidelines with the 
        greatest potential to improve health care quality, efficiency, 
        and patient safety.
    ``(h) Rule of Construction.--Nothing in this title shall be 
construed as prohibiting the Secretary, acting through the 
Administrator of the Centers for Medicare & Medicaid Services, from 
developing quality measures (and timing requirements for reporting such 
measures) for use under programs administered by the Secretary under 
the Social Security Act, including programs under titles XVIII, XIX, 
and XXI of such Act.''.

SEC. 3. LICENSURE AND THE ELECTRONIC EXCHANGE OF HEALTH INFORMATION.

    (a) In General.--The Secretary of Health and Human Services shall 
carry out, or contract with a private entity to carry out, a study that 
examines--
            (1) the variation among State laws that relate to the 
        licensure, registration, and certification of medical 
        professionals; and
            (2) how such variation among State laws impacts the secure 
        electronic exchange of health information--
                    (A) among the States; and
                    (B) between the States and the Federal Government.
    (b) Report and Recommendations.--Not later than 1 year after the 
date of enactment of this Act, the Secretary of Health and Human 
Services shall publish a report that--
            (1) describes the results of the study carried out under 
        subsection (a); and
            (2) makes recommendations to States regarding the 
        harmonization of State laws based on the results of such study.

SEC. 4. ENSURING PRIVACY AND SECURITY.

    Nothing in this Act (or the amendments made by this Act) shall be 
construed to affect the scope, substance, or applicability of--
            (1) section 264 of the Health Insurance Portability and 
        Accountability Act of 1996;
            (2) sections 1171 through 1179 of the Social Security Act; 
        and
            (3) any regulation issued pursuant to any such section.

SEC. 5. GAO STUDY.

    Not later than 6 months after the date of enactment of this Act, 
the Comptroller General of the United States shall submit to Congress a 
report on the necessity and workability of requiring health plans (as 
defined in section 1171 of the Social Security Act (42 U.S.C. 1320d)), 
health care clearinghouses (as defined in such section 1171), and 
health care providers (as defined in such section 1171) who transmit 
health information in electronic form, to notify patients if their 
individually identifiable health information (as defined in such 
section 1171) is wrongfully disclosed.

SEC. 6. STUDY OF REIMBURSEMENT INCENTIVES.

    The Secretary of Health and Human Services shall carry out, or 
contract with a private entity to carry out, a study that examines 
methods to create efficient reimbursement incentives for improving 
health care quality in Federally qualified health centers, rural health 
clinics, and free clinics.

SEC. 7. HEALTH INFORMATION TECHNOLOGY RESOURCE CENTER.

    Section 914 of the Public Health Service Act (42 U.S.C. 299b-3) is 
amended by adding at the end the following:
    ``(d) Health Information Technology Resource Center.--
            ``(1) In general.--The Secretary, acting through the 
        Director, shall develop a Health Information Technology 
        Resource Center to provide technical assistance and develop 
        best practices to support and accelerate efforts to adopt, 
        implement, and effectively use interoperable health information 
        technology in compliance with section 2903 and 2907.
            ``(2) Purposes.--The purpose of the Center is to--
                    ``(A) provide a forum for the exchange of knowledge 
                and experience;
                    ``(B) accelerate the transfer of lessons learned 
                from existing public and private sector initiatives, 
                including those currently receiving Federal financial 
                support;
                    ``(C) assemble, analyze, and widely disseminate 
                evidence and experience related to the adoption, 
                implementation, and effective use of interoperable 
                health information technology.
                    ``(D) provide for the establishment of regional and 
                local health information networks to facilitate the 
                development of interoperability across health care 
                settings and improve the quality of health care;
                    ``(E) provide for the development of solutions to 
                barriers to the exchange of electronic health 
                information; and
                    ``(F) conduct other activities identified by the 
                States, local or regional health information networks, 
                or health care stakeholders as a focus for developing 
                and sharing best practices.
            ``(3) Support for activities.--To provide support for the 
        activities of the Center, the Director shall modify the 
        requirements, if necessary, that apply to the National Resource 
        Center for Health Information Technology to provide the 
        necessary infrastructure to support the duties and activities 
        of the Center and facilitate information exchange across the 
        public and private sectors.
            ``(4) Rule of construction.--Nothing in this subsection 
        shall be construed to require the duplication of Federal 
        efforts with respect to the establishment of the Center, 
        regardless of whether such efforts were carried out prior to or 
        after the enactment of this subsection.
    ``(e) Technical Assistance Telephone Number or Website.--The 
Secretary shall establish a toll-free telephone number or Internet 
website to provide health care providers and patients with a single 
point of contact to--
            ``(1) learn about Federal grants and technical assistance 
        services related to interoperable health information 
        technology;
            ``(2) learn about qualified health information technology 
        and the quality measures adopted by the Federal Government 
        under sections 2903 and 2907;
            ``(3) learn about regional and local health information 
        networks for assistance with health information technology; and
            ``(4) disseminate additional information determined by the 
        Secretary.
    ``(f) Authorization of Appropriations.--There is authorized to be 
appropriated, such sums as may be necessary for each of fiscal years 
2006 and 2007 to carry out this subsection.''.

SEC. 8. REAUTHORIZATION OF INCENTIVE GRANTS REGARDING TELEMEDICINE.

    Section 330L(b) of the Public Health Service Act (42 U.S.C. 254c-
18(b)) is amended by striking ``2002 through 2006'' and inserting 
``2006 through 2010''.

            Passed the Senate November 18 (legislative day, November 
      17), 2005.

            Attest:

                                             EMILY J. REYNOLDS,

                                                             Secretary.
```