I 

111TH CONGRESS 

1ST SESSION H. R. 1039 

To encourage and enhance the adoption of interoperable health information 

technology to improve health care quality, reduce medical errors, and 

increase the efficiency of care. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 12, 2009 

Mr. SAM JOHNSON of Texas (for himself, Mr. BRADY of Texas, Ms. GINNY

BROWN-WAITE of Florida, Mr. REICHERT, Mr. ROSKAM, and Mr. 

BOUSTANY) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on 

Ways and Means, for a period to be subsequently determined by the 

Speaker, in each case for consideration of such provisions as fall within 

the jurisdiction of the committee concerned 

A BILL 

To encourage and enhance the adoption of interoperable 

health information technology to improve health care 

quality, reduce medical errors, and increase the efficiency 

of care. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Promoting Health Information Technology Act of 2009’’. 


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1 (b) TABLE OF CONTENTS.—The table of contents of 

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—STRATEGIC PLAN TOWARDS NATIONWIDE 

INTEROPERABILITY 

Sec. 101. Office of the National Coordinator for Health Information Technology. 

Sec. 102. Successor to the American Health Information Community. 

Sec. 103. Health Information Technology Resource Center. 

Sec. 104. Strategic plan for coordinating implementation of health information 

technology. 

TITLE II—MODERNIZING THE HEALTH CARE DELIVERY SYSTEM 

Sec. 201. Procedures to ensure timely updating of standards that enable electronic exchanges. 

Sec. 202. Federal purchasing and data collection. 

Sec. 203. Study to improve preservation and protection of security and confidentiality of health information. 

TITLE III—INCENTIVIZING ADOPTION OF HEALTH IT 

Sec. 301. Incentives for medical care providers to adopt health care information 

technology. 

Sec. 302. Elimination of sunset applicable to Stark exception for electronic 

health records arrangements. 

Sec. 303. Promotion of telehealth services. 

Sec. 304. FQHCs included in electronic health records demonstration. 

Sec. 305. Interest-free loan program for hospitals to adopt health information 

technology. 

3 TITLE I—STRATEGIC PLAN TO4 WARDS NATIONWIDE INTER5 OPERABILITY 

6 SEC. 101. OFFICE OF THE NATIONAL COORDINATOR FOR 

7 HEALTH INFORMATION TECHNOLOGY. 

8 (a) ESTABLISHMENT.—There is established within 

9 the Department of Health and Human Services an Office 

10 of the National Coordinator for Health Information Tech11 nology that shall be headed by the National Coordinator 

12 for Health Information Technology (referred to in this 


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1 section as the ‘‘National Coordinator’’). The National Co2 ordinator shall be appointed by the President and shall 

3 report directly to the Secretary of Health and Human 

4 Services. The National Coordinator shall be paid at a rate 

5 equal to the rate of basic pay for level IV of the Executive 

6 Schedule. 

7 (b) GOALS OF NATIONWIDE INTEROPERABLE

8 HEALTH INFORMATION TECHNOLOGY INFRASTRUC9 TURE.—The National Coordinator shall perform the du10 ties under subsection (c) in a manner consistent with the 

11 development of a nationwide interoperable health informa12 tion technology infrastructure that— 

13 (1) improves health care quality, reduces med14 ical errors, increases the efficiency of care, and ad15 vances the delivery of appropriate, evidence-based 

16 health care services; 

17 (2) promotes wellness, disease prevention, and 

18 management of chronic illnesses by increasing the 

19 availability and transparency of information related 

20 to the health care needs of an individual for such in21 dividual; 

22 (3) ensures that appropriate information nec23 essary to make medical decisions is available in a us24 able form at the time and in the location that the 

25 medical service involved is provided; 


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1 (4) produces greater value for health care ex2 penditures by reducing health care costs that result 

3 from inefficiency, medical errors, inappropriate care, 

4 and incomplete information; 

5 (5) promotes a more effective marketplace, 

6 greater competition, greater systems analysis, in7 creased choice, enhanced quality, and improved out8 comes in health care services; 

9 (6) improves the coordination of information 

10 and the provision of such services through an effec11 tive infrastructure for the secure and authorized ex12 change and use of health care information; and 

13 (7) ensures that the confidentiality of individ14 ually identifiable health information of a patient is 

15 secure and protected. 

16 (c) DUTIES OF NATIONAL COORDINATOR.— 

17 (1) STRATEGIC PLANNER FOR INTEROPERABLE

18 HEALTH INFORMATION TECHNOLOGY.—The Na19 tional Coordinator shall maintain, direct, and over20 see the continuous improvement of a strategic plan 

21 to guide the nationwide implementation of interoper22 able health information technology in both the public 

23 and private health care sectors consistent with sub24 section (b). 


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1 (2) PRINCIPAL ADVISOR TO HHS.—The Na2 tional Coordinator shall serve as the principal advi3 sor of the Secretary of Health and Human Services 

4 on the development, application, and use of health 

5 information technology, and coordinate the health 

6 information technology programs of the Department 

7 of Health and Human Services. 

8 (3) COORDINATOR OF FEDERAL GOVERNMENT

9 ACTIVITIES.— 

10 (A) IN GENERAL.—The National Coordi11 nator shall serve as the coordinator of Federal 

12 Government activities relating to health infor13 mation technology. 

14 (B) SPECIFIC COORDINATION FUNC15 TIONS.—In carrying out subparagraph (A), the 

16 National Coordinator shall provide for— 

17 (i) the approval of standards devel18 oped and recommended by AHIC 2.0 

19 under section 102 (which may include 

20 standards relating to the interoperability, 

21 privacy, and security of health information 

22 technology) to be used in the electronic 

23 creation, maintenance, or exchange of 

24 health information; and 


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1 (ii) the certification and inspection of 

2 health information technology products, ex3 changes, and architectures to ensure that 

4 such products, exchanges, and architec5 tures conform to the applicable standards 

6 approved under clause (i). 

7 Any standard approved or health information 

8 technology product, exchange, or architecture 

9 certified pursuant to Executive Order 13335 as 

10 of the day before the date of the enactment of 

11 this Act shall be deemed to be a standard ap12 proved or product, exchange, or architecture 

13 certified, respectively, pursuant to this subpara14 graph as of such date of enactment. 

15 (C) USE OF PRIVATE ENTITIES.—The Na16 tional Coordinator shall, to the maximum extent 

17 possible, contract with or recognize private enti18 ties in carrying out subparagraph (B). 

19 (D) UNIFORM APPLICATION OF STAND20 ARDS.—A standard approved under subpara21 graph (B)(i) for use in the electronic creation, 

22 maintenance, or exchange of health information 

23 shall preempt a standard adopted under State 

24 law, regulation, or rule for such a use. 


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1 (4) INTRAGOVERNMENTAL COORDINATOR.—The 

2 National Coordinator shall ensure that health infor3 mation technology policies and programs of the De4 partment of Health and Human Services are coordi5 nated with those of relevant executive branch agen6 cies and departments with a goal to avoid duplica7 tion of effort and to ensure that each agency or de8 partment conducts programs within the areas of its 

9 greatest expertise and its mission in order to create 

10 a national interoperable health information system 

11 capable of meeting national public health needs ef12 fectively and efficiently. 

13 (5) ADVISOR TO OMB.—The National Coordi14 nator shall provide to the Director of the Office of 

15 Management and Budget comments and advice with 

16 respect to specific Federal health information tech17 nology programs. 

18 (d) AUTHORIZATION OF APPROPRIATIONS.—There 

19 are authorized to be appropriated such sums as may be 

20 necessary to carry out this section for each of fiscal years 

21 2009 through 2013. 

22 (e) TREATMENT OF EXECUTIVE ORDER 13335.—Ex23 ecutive Order 13335 shall not have any force or effect 

24 after the date of the enactment of this Act. 


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1 (f) TRANSITION FROM ONCHIT UNDER EXECUTIVE

2 ORDER.— 

3 (1) IN GENERAL.—All functions, personnel, as4 sets, liabilities, administrative actions, and statutory 

5 reporting requirements applicable to the old Na6 tional Coordinator or the Office of the old National 

7 Coordinator on the date before the date of the enact8 ment of this Act shall be transferred, and applied in 

9 the same manner and under the same terms and 

10 conditions, to the new National Coordinator and the 

11 Office of the new National Coordinator as of the 

12 date of the enactment of this Act. 

13 (2) ACTING NATIONAL COORDINATOR.—Before 

14 the appointment of the new National Coordinator, 

15 the old National Coordinator shall act as the Na16 tional Coordinator for Health Information Tech17 nology until the office is filled as provided in sub18 section (a). The President may appoint the old Na19 tional Coordinator as the new National Coordinator. 

20 (3) DEFINITIONS.—For purposes of this sub21 section: 

22 (A) NEW NATIONAL COORDINATOR.—The 

23 term ‘‘new National Coordinator’’ means the 

24 National Coordinator for Health Information 

25 Technology appointed under subsection (a). 


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1 (B) OLD NATIONAL COORDINATOR.—The 

2 term ‘‘old National Coordinator’’ means the 

3 National Coordinator for Health Information 

4 Technology appointed under Executive Order 

5 13335. 

6 SEC. 102. SUCCESSOR TO THE AMERICAN HEALTH INFOR7 MATION COMMUNITY. 

8 (a) IN GENERAL.—The Secretary of Health and 

9 Human Services shall (through a grant, contract, or coop10 erative agreement) ensure the establishment and provide 

11 for the operation of an entity described in subsection (b) 

12 (in this Act to be referred to as ‘‘AHIC 2.0’’) for purposes 

13 of developing and recommending standards described in 

14 section 101(c)(3)(B)(i) for approval under such section. 

15 (b) STRUCTURE AND PROCEDURES OF ENTITY.—An 

16 entity described in this subsection is an entity— 

17 (1) in the operation of which there is broad par18 ticipation by a variety of public and private stake19 holders, (whether through membership or through 

20 other means); 

21 (2) that uses a consensus approach and a fair 

22 and open process to support the development of 

23 standards under subsection (a); and 

24 (3) that has a business plan and a published set 

25 of governance rules that enables the entity to be 


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1 self-sustaining and to fulfill the purposes described 

2 in subsection (a). 

3 (c) CONSULTATION.—In establishing AHIC 2.0, the 

4 entity awarded a grant, contract, or cooperative agreement 

5 pursuant to subsection (a), shall consult with a wide vari6 ety of private and public stakeholders that are knowledge7 able with respect to standards to be developed by AHIC 

8 2.0 or that would be potentially affected by the rec9 ommendations of AHIC 2.0. 

10 (d) FUNDING.— 

11 (1) AUTHORIZATION OF APPROPRIATIONS.— 

12 There are authorized to be appropriated to carry out 

13 this section $13,000,000, to remain available until 

14 expended. 

15 (2) FURTHER FEDERAL FUNDING OTHER THAN

16 DUES PROHIBITED.—Except as otherwise provided 

17 by this subsection, and except for such dues as may 

18 be paid by a Federal agency for membership or 

19 other participation in AHIC 2.0, no Federal agency 

20 may provide funding to the entity. There are author21 ized to be appropriated to such agencies such 

22 amounts as are necessary to pay the dues described 

23 in the previous sentence. 

24 (e) NONDUPLICATION OF EFFORTS TO ESTABLISH

25 AHIC 2.0.—Nothing in this section shall be construed as 


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1 requiring the duplication of Federal efforts (such as 

2 awarding a grant, contract, or cooperative agreement) 

3 that were carried out before the date of the enactment 

4 of this Act, with respect to the establishment of an entity 

5 to support the development and recommendation of stand6 ards under subsection (a). 

7 (f) TREATMENT OF STANDARDS DEVELOPED OR AP8 PROVED BY AHIC.—For purposes of this title, a standard 

9 developed or approved (or in a stage of development or 

10 approval) by the American Health Information Commu11 nity established pursuant to Executive Order 13335 (or 

12 the AHIC Successor, Inc. doing business as the National 

13 eHealth Collaborative) as of the day before the date of 

14 the enactment of this Act shall be deemed to be a standard 

15 developed or approved, respectively, (or in such stage of 

16 development or approval) by AHIC 2.0 as of such date 

17 of enactment. 

18 SEC. 103. HEALTH INFORMATION TECHNOLOGY RESOURCE 

19 CENTER. 

20 (a) IN GENERAL.—There is established within the 

21 Office of the National Coordinator for Health Information 

22 Technology the Health Information Technology Resource 

23 Center (referred to in this section as the ‘‘Center’’) to 

24 carry out the following functions: 


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1 (1) Provide assistance and support for adoption 

2 and implementation efforts and effective use of 

3 interoperable health information technology. 

4 (2) Serve as a forum for the exchange of knowl5 edge and experience. 

6 (3) Accelerate the transmission of knowledge 

7 from existing health information initiatives in both 

8 the private and public sectors. 

9 (4) Support the establishment of regional and 

10 local health information networks to facilitate the 

11 interoperability of health care data across health 

12 care settings. 

13 (5) Develop solutions to barriers to electronic 

14 health information exchange. 

15 (6) Provide technical assistance and tools to 

16 help health information exchanges develop a path to17 ward financial sustainability. 

18 (7) Establish a longitudinal database to meas19 ure the business sustainability of health information 

20 exchange and evaluate the impact of health informa21 tion exchange on community health outcomes and 

22 value. 

23 (b) RULE OF CONSTRUCTION.—Nothing in this sec24 tion shall be construed to require the duplication of Fed25 eral efforts with respect to the establishment of the CenVerDate Nov 24 2008 19:15 Feb 14, 2009 Jkt 079200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H1039.IH H1039

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1 ter, regardless of whether such efforts were carried out 

2 prior to or after the enactment of this subsection. 

3 (c) TRANSITION FROM NATIONAL RESOURCE CEN4 TER FOR HEALTH INFORMATION TECHNOLOGY UNDER

5 AHRQ.—All functions, personnel, assets, and liabilities 

6 applicable to the National Resource Center for Health In7 formation Technology under the Agency for Healthcare 

8 Research and Quality as of the day before the date of the 

9 enactment of this Act shall be transferred, and applied 

10 in the same manner and under the same terms and condi11 tions, to the Health Information Technology Resource 

12 Center under the Office of the National Coordinator for 

13 Health Information Technology established under sub14 section (a) as of the date of the enactment of this Act. 

15 SEC. 104. STRATEGIC PLAN FOR COORDINATING IMPLE16 MENTATION OF HEALTH INFORMATION 

17 TECHNOLOGY. 

18 (a) IN GENERAL.—Not later than 180 days after the 

19 date of the enactment of this Act, the Secretary of Health 

20 and Human Services, in consultation with entities involved 

21 in the area of health information technology, shall develop 

22 a strategic plan related to the need for coordination in 

23 such area. 

24 (b) COORDINATION OF SPECIFIC IMPLEMENTATION

25 PROCESSES.—The strategic plan under subsection (a) 


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1 shall address the need for coordination in the implementa2 tion of the following: 

3 (1) HEALTH INFORMATION TECHNOLOGY

4 STANDARDS.—Health information technology stand5 ards approved under section 101(c)(3)(B)(i). 

6 (2) HIPAA TRANSACTION STANDARDS.—Trans7 action standards under section 1173(a) of the Social 

8 Security Act (42 U.S.C. 1320d–2(d)). 

9 (c) COORDINATION AMONG SPECIFIC FEDERAL EN10 TITIES.—The strategic plan under subsection (a) shall ad11 dress any methods to coordinate, with respect to the elec12 tronic exchange of health information, actions taken by 

13 the following entities: 

14 (1) The Office of the National Coordinator for 

15 Health Information Technology. 

16 (2) AHIC 2.0 established under section 102. 

17 (3) The Office of Electronic Standards and Se18 curity of the Centers for Medicare and Medicaid 

19 Services. 

20 (4) The National Committee on Vital Health 

21 Statistics. 

22 (5) Any other entity involved in the electronic 

23 exchange of health information that the Secretary 

24 determines appropriate. 


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1 TITLE II—MODERNIZING THE 

2 HEALTH CARE DELIVERY SYS3 TEM 

4 SEC. 201. PROCEDURES TO ENSURE TIMELY UPDATING OF 

5 STANDARDS THAT ENABLE ELECTRONIC EX6 CHANGES. 

7 Section 1174(b) of the Social Security Act (42 U.S.C. 

8 1320d–3(b)) is amended— 

9 (1) in paragraph (1)— 

10 (A) in the first sentence, by inserting ‘‘and 

11 in accordance with paragraph (3)’’ before the 

12 period; and 

13 (B) by adding at the end the following new 

14 sentence: ‘‘For purposes of this subsection and 

15 section 1173(c)(2), the term ‘modification’ in16 cludes a new version or a version upgrade.’’; 

17 and 

18 (2) by adding at the end the following new 

19 paragraph: 

20 ‘‘(3) EXPEDITED PROCEDURES FOR ADOPTION

21 OF ADDITIONS AND MODIFICATIONS TO STAND22 ARDS.— 

23 ‘‘(A) IN GENERAL.—For purposes of para24 graph (1), the Secretary shall provide for an ex25 pedited upgrade program (in this paragraph reVerDate Nov 24 2008 19:15 Feb 14, 2009 Jkt 079200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\H1039.IH H1039

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1 ferred to as the ‘upgrade program’), in accord2 ance with this paragraph, to develop and ap3 prove additions and modifications to the stand4 ards adopted under section 1173(a) to improve 

5 the quality of such standards or to extend the 

6 functionality of such standards to meet evolving 

7 requirements in health care. 

8 ‘‘(B) PUBLICATION OF NOTICES.—Under 

9 the upgrade program: 

10 ‘‘(i) VOLUNTARY NOTICE OF INITI11 ATION OF PROCESS.—Not later than 30 

12 days after the date the Secretary receives 

13 a notice from a standard setting organiza14 tion that the organization is initiating a 

15 process to develop an addition or modifica16 tion to a standard adopted under section 

17 1173(a), the Secretary shall publish a no18 tice in the Federal Register that— 

19 ‘‘(I) identifies the subject matter 

20 of the addition or modification; 

21 ‘‘(II) provides a description of 

22 how persons may participate in the 

23 development process; and 

24 ‘‘(III) invites public participation 

25 in such process. 


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1 ‘‘(ii) VOLUNTARY NOTICE OF PRE2 LIMINARY DRAFT OF ADDITIONS OR MODI3 FICATIONS TO STANDARDS.—Not later 

4 than 30 days after the date the Secretary 

5 receives a notice from a standard setting 

6 organization that the organization has pre7 pared a preliminary draft of an addition or 

8 modification to a standard adopted by sec9 tion 1173(a), the Secretary shall publish a 

10 notice in the Federal Register that— 

11 ‘‘(I) identifies the subject matter 

12 of (and summarizes) the addition or 

13 modification; 

14 ‘‘(II) specifies the procedure for 

15 obtaining the draft; 

16 ‘‘(III) provides a description of 

17 how persons may submit comments in 

18 writing and at any public hearing or 

19 meeting held by the organization on 

20 the addition or modification; and 

21 ‘‘(IV) invites submission of such 

22 comments and participation in such 

23 hearing or meeting without requiring 

24 the public to pay a fee to participate. 


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1 ‘‘(iii) NOTICE OF PROPOSED ADDITION

2 OR MODIFICATION TO STANDARDS.—Not 

3 later than 30 days after the date the Sec4 retary receives a notice from a standard 

5 setting organization that the organization 

6 has a proposed addition or modification to 

7 a standard adopted under section 1173(a) 

8 that the organization intends to submit 

9 under subparagraph (D)(iii), the Secretary 

10 shall publish a notice in the Federal Reg11 ister that contains, with respect to the pro12 posed addition or modification, the infor13 mation required in the notice under clause 

14 (ii) with respect to the addition or modi15 fication. 

16 ‘‘(iv) CONSTRUCTION.—Nothing in 

17 this paragraph shall be construed as re18 quiring a standard setting organization to 

19 request the notices described in clauses (i) 

20 and (ii) with respect to an addition or 

21 modification to a standard in order to 

22 qualify for an expedited determination 

23 under subparagraph (C) with respect to a 

24 proposal submitted to the Secretary for 

25 adoption of such addition or modification. 


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1 ‘‘(C) PROVISION OF EXPEDITED DETER2 MINATION.—Under the upgrade program and 

3 with respect to a proposal by a standard setting 

4 organization for an addition or modification to 

5 a standard adopted under section 1173(a), if 

6 the Secretary determines that the standard set7 ting organization developed such addition or 

8 modification in accordance with the require9 ments of subparagraph (D) and the National 

10 Committee on Vital and Health Statistics rec11 ommends approval of such addition or modifica12 tion under subparagraph (E), the Secretary 

13 shall provide for expedited treatment of such 

14 proposal in accordance with subparagraph (F). 

15 ‘‘(D) REQUIREMENTS.—The requirements 

16 under this subparagraph with respect to a pro17 posed addition or modification to a standard by 

18 a standard setting organization are the fol19 lowing: 

20 ‘‘(i) REQUEST FOR PUBLICATION OF

21 NOTICE.—The standard setting organiza22 tion submits to the Secretary a request for 

23 publication in the Federal Register of a no24 tice described in subparagraph (B)(iii) for 

25 the proposed addition or modification. 


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1 ‘‘(ii) PROCESS FOR RECEIPT AND

2 CONSIDERATION OF PUBLIC COMMENT.— 

3 The standard setting organization provides 

4 for a process through which, after the pub5 lication of the notice referred to under 

6 clause (i), the organization— 

7 ‘‘(I) receives and responds to 

8 public comments submitted on a time9 ly basis on the proposed addition or 

10 modification before submitting such 

11 proposed addition or modification to 

12 the National Committee on Vital and 

13 Health Statistics under clause (iii); 

14 ‘‘(II) makes publicly available a 

15 written explanation for its response in 

16 the proposed addition or modification 

17 to comments submitted on a timely 

18 basis; and 

19 ‘‘(III) makes public comments re20 ceived under clause (I) available, or 

21 provides access to such comments, to 

22 the Secretary. 

23 ‘‘(iii) SUBMITTAL OF FINAL PRO24 POSED ADDITION OR MODIFICATION TO

25 NCVHS.—After completion of the process 


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1 under clause (ii), the standard setting or2 ganization submits the proposed addition 

3 or modification to the National Committee 

4 on Vital and Health Statistics for review 

5 and consideration under subparagraph (E). 

6 Such submission shall include information 

7 on the organization’s compliance with the 

8 notice and comment requirements (and re9 sponses to those comments) under clause 

10 (ii). 

11 ‘‘(E) HEARING AND RECOMMENDATIONS

12 BY NATIONAL COMMITTEE ON VITAL AND

13 HEALTH STATISTICS.—Under the upgrade pro14 gram, upon receipt of a proposal submitted by 

15 a standard setting organization under subpara16 graph (D)(iii) for the adoption of an addition or 

17 modification to a standard, the National Com18 mittee on Vital and Health Statistics shall pro19 vide notice to the public and a reasonable op20 portunity for public testimony at a hearing on 

21 such addition or modification. The Secretary 

22 may participate in such hearing in such capac23 ity (including presiding ex officio) as the Sec24 retary shall determine appropriate. Not later 

25 than 90 days after the date of receipt of the 


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1 proposal, the Committee shall submit to the 

2 Secretary its recommendation to adopt (or not 

3 adopt) the proposed addition or modification. 

4 ‘‘(F) DETERMINATION BY SECRETARY TO

5 ACCEPT OR REJECT NATIONAL COMMITTEE ON

6 VITAL AND HEALTH STATISTICS RECOMMENDA7 TION.— 

8 ‘‘(i) TIMELY DETERMINATION.— 

9 Under the upgrade program, if the Na10 tional Committee on Vital and Health Sta11 tistics submits to the Secretary a rec12 ommendation under subparagraph (E) to 

13 adopt a proposed addition or modification, 

14 not later than 90 days after the date of re15 ceipt of such recommendation the Sec16 retary shall make a determination to ac17 cept or reject the recommendation and 

18 shall publish notice of such determination 

19 in the Federal Register not later than 30 

20 days after the date of the determination. 

21 ‘‘(ii) CONTENTS OF NOTICE.—If the 

22 determination is to reject the recommenda23 tion, such notice shall include the reasons 

24 for the rejection. If the determination is to 

25 accept the recommendation, as part of 


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1 such notice the Secretary shall promulgate 

2 the modified standard (including the ac3 cepted proposed addition or modification 

4 accepted). 

5 ‘‘(iii) LIMITATION ON CONSIDER6 ATION.—The Secretary shall not consider a 

7 proposal under this subparagraph unless 

8 the Secretary determines that the require9 ments of subparagraph (D) (including pub10 lication of notice and opportunity for pub11 lic comment) have been met with respect to 

12 the proposal. 

13 ‘‘(G) EXEMPTION FROM PAPERWORK RE14 DUCTION ACT.—Chapter 35 of title 44, United 

15 States Code, shall not apply to a final rule pro16 mulgated under subparagraph (F).’’. 

17 SEC. 202. FEDERAL PURCHASING AND DATA COLLECTION. 

18 (a) COORDINATION OF FEDERAL SPENDING.— 

19 (1) IN GENERAL.—Subject to section 203(c), 

20 not later than 1 year after the date of the approval 

21 of an applicable standard under section 

22 101(c)(3)(B)(i), no Federal funds may be used for 

23 the purchase of any health information technology or 

24 health information technology system for clinical 

25 care or for the electronic retrieval, storage, or exVerDate Nov 24 2008 19:15 Feb 14, 2009 Jkt 079200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\H1039.IH H1039

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1 change of health information unless such technology 

2 or system has been certified under section 

3 101(c)(3)(B)(ii) with respect to compliance with 

4 such standard. 

5 (2) RULE OF CONSTRUCTION.—Nothing in 

6 paragraph (1) shall be construed to restrict the pur7 chase of minor (as determined by the Secretary) 

8 hardware or software components in order to mod9 ify, correct a deficiency in, or extend the life of exist10 ing hardware or software. 

11 (b) COORDINATION OF FEDERAL DATA COLLEC12 TION.—Subject to section 203(c), not later than 3 years 

13 after the date of the approval of an applicable standard 

14 under section 101(c)(3)(B)(i), all Federal agencies col15 lecting health data in an electronic format for the pur16 poses of quality reporting, surveillance, epidemiology, ad17 verse event reporting, research, or for other purposes de18 termined appropriate by the Secretary of Health and 

19 Human Services, shall comply with such standard. 

20 SEC. 203. STUDY TO IMPROVE PRESERVATION AND PRO21 TECTION OF SECURITY AND CONFIDEN22 TIALITY OF HEALTH INFORMATION. 

23 (a) IN GENERAL.—The Secretary of Health and 

24 Human Services shall conduct a study of current Federal 

25 security and confidentiality standards to determine the 


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1 strengths and weaknesses of such standards for purposes 

2 of protecting the security and confidentiality of individ3 ually identifiable health information while taking into ac4 count the need for timely and efficient exchanges of health 

5 information to improve quality of care and ensure the 

6 availability of health information necessary to make med7 ical decisions at the location in which the medical care in8 volved is provided. 

9 (b) REPORT.—Not later than 24 months after the 

10 date of the enactment of this Act, the Secretary of Health 

11 and Human Services shall submit to Congress a report 

12 on the study under subsection (a) and shall include in such 

13 report recommendations for improving the current Federal 

14 security and confidentiality standards, including rec15 ommendations for a mechanism to track breaches to the 

16 security or confidentiality of individually identifiable 

17 health information and for appropriate penalties to apply 

18 in the case of such a breach. 

19 (c) PRESERVATION OF CURRENT SECURITY AND

20 CONFIDENTIALITY STANDARDS BEFORE SUBMITTAL OF

21 REPORT.—None of the provisions of this Act or amend22 ments made by this Act may limit, or require issuance of 

23 a regulation that would limit, the effect of a current Fed24 eral security and confidentiality standard before the date 

25 of the submittal of the report under subsection (b). 


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1 (d) CURRENT FEDERAL SECURITY AND CONFIDEN2 TIALITY STANDARDS DEFINED.—For purposes of this sec3 tion, the term ‘‘current Federal security and confiden4 tiality standards’’ means the Federal privacy standards es5 tablished pursuant to section 264(c) of the Health Insur6 ance Portability and Accountability Act of 1996 (42 

7 U.S.C. 1320d–2 note) and security standards established 

8 under section 1173(d) of the Social Security Act. 

9 TITLE III—INCENTIVIZING 

10 ADOPTION OF HEALTH IT 

11 SEC. 301. INCENTIVES FOR MEDICAL CARE PROVIDERS TO 

12 ADOPT HEALTH CARE INFORMATION TECH13 NOLOGY. 

14 (a) IN GENERAL.—Subsection (b) of section 179 of 

15 the Internal Revenue Code of 1986 is amended by adding 

16 at the end the following new paragraph: 

17 ‘‘(8) INCREASED LIMITATION FOR HEALTH

18 CARE INFORMATION TECHNOLOGY.— 

19 ‘‘(A) IN GENERAL.—In the case of a med20 ical care provider for any taxable year begin21 ning after December 31, 2008, and before Jan22 uary 1, 2014— 

23 ‘‘(i) the dollar amount in effect under 

24 paragraph (1) shall be increased by the 

25 lesser of— 


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1 ‘‘(I) $250,000, or 

2 ‘‘(II) the cost of qualified health 

3 care information technology placed in 

4 service by such provider during the 

5 taxable year, and 

6 ‘‘(ii) the dollar amount in effect under 

7 paragraph (2) shall be increased by the 

8 lesser of— 

9 ‘‘(I) $800,000, or 

10 ‘‘(II) the cost of qualified health 

11 care information technology placed in 

12 service by such provider during the 

13 taxable year. 

14 ‘‘(B) DEFINITIONS.—For purposes of this 

15 subsection— 

16 ‘‘(i) QUALIFIED HEALTH CARE INFOR17 MATION TECHNOLOGY.—The term ‘quali18 fied health care information technology’ 

19 means section 179 property which— 

20 ‘‘(I) has been certified pursuant 

21 to section 101(c)(3)(B)(ii) of the Pro22 moting Health Information Tech23 nology Act of 2009, and 

24 ‘‘(II) is used primarily for the 

25 electronic creation, maintenance, and 


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1 exchange of medical care information 

2 to improve the quality or efficiency of 

3 medical care. 

4 ‘‘(ii) MEDICAL CARE PROVIDER.—The 

5 term ‘medical care provider’ means any 

6 person engaged in the trade or business of 

7 providing medical care. 

8 ‘‘(iii) MEDICAL CARE.—The term 

9 ‘medical care’ has the meaning given such 

10 term by section 213(d).’’. 

11 (b) EFFECTIVE DATE.—The amendment made by 

12 this section shall apply to property placed in service after 

13 December 31, 2008. 

14 SEC. 302. ELIMINATION OF SUNSET APPLICABLE TO STARK 

15 EXCEPTION FOR ELECTRONIC HEALTH 

16 RECORDS ARRANGEMENTS. 

17 In applying section 1877(e) of the Social Security Act 

18 (42 U.S.C. 1395(e)), with respect to a regulation imple19 menting such section by providing an exception to the pro20 hibition against making certain physician referrals in the 

21 case of the offering or payment of nonmonetary remunera22 tion (consisting of items and services in the form of soft23 ware or information technology and training services) nec24 essary and used predominantly to create, maintain, trans25 mit, or receive electronic health records, the Secretary of 


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1 Health and Human Services shall not limit the period in 

2 which such an exception under such a regulation applies. 

3 SEC. 303. PROMOTION OF TELEHEALTH SERVICES. 

4 (a) FACILITATING THE PROVISION OF TELEHEALTH

5 SERVICES ACROSS STATE LINES.— 

6 (1) IN GENERAL.—The Secretary of Health and 

7 Human Services shall, in coordination with physi8 cians, health care practitioners, patient advocates, 

9 and representatives of States, encourage and facili10 tate the adoption of State reciprocity agreements for 

11 practitioner licensure in order to expedite the provi12 sion across State lines of telehealth services. 

13 (2) REPORT.—Not later than 18 months after 

14 the date of the enactment of this Act, the Secretary 

15 of Health and Human Services shall submit to Con16 gress a report on the actions taken to carry out 

17 paragraph (1). 

18 (3) STATE DEFINED.—For purposes of this 

19 subsection, the term ‘‘State’’ has the meaning given 

20 that term for purposes of title XVIII of the Social 

21 Security Act. 

22 (b) STUDY AND REPORT ON EXPANSION OF HOME

23 HEALTH-RELATED TELEHEALTH SERVICES.— 


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1 (1) STUDY.—The Secretary of Health and 

2 Human Services shall conduct a study to determine 

3 the feasibility, advisability, and the costs of— 

4 (A) including coverage and payment for 

5 home health-related telehealth services as part 

6 of home health services under title XVIII of the 

7 Social Security Act; and 

8 (B) expanding the list of sites described in 

9 paragraph (4)(C)(ii) of section 1834(m) of the 

10 Social Security Act (42 U.S.C. 1395m(m)) to 

11 include county mental health clinics or other 

12 publicly funded mental health facilities for the 

13 purpose of payment under such section for the 

14 provision of telehealth services at such clinics or 

15 facilities. 

16 (2) SPECIFICS OF STUDY.—Such study shall 

17 demonstrate whether the changes described in sub18 paragraphs (A) and (B) of paragraph (1) are likely 

19 to result in the following: 

20 (A) Enhanced health outcomes for individ21 uals with one or more chronic conditions. 

22 (B) Health outcomes for individuals fur23 nished telehealth services or home health-re24 lated telehealth services that are at least com25 parable to the health outcomes for individuals 


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1 furnished similar items and services by a health 

2 care provider at the same location of the indi3 vidual or at the home of the individual, respec4 tively. 

5 (C) Facilitation of communication of more 

6 accurate clinical information between health 

7 care providers. 

8 (D) Closer monitoring of individuals by 

9 health care providers. 

10 (E) Overall reduction in expenditures for 

11 health care items and services. 

12 (F) Improved access to health care. 

13 (3) HOME HEALTH-RELATED TELEHEALTH

14 SERVICES DEFINED.—For purposes of this sub15 section, the term ‘‘home health-related telehealth 

16 services’’ means technology-based professional con17 sultations, patient monitoring, patient training serv18 ices, clinical observation, patient assessment, and 

19 any other health services that utilize telecommuni20 cations technologies. Such term does not include a 

21 telecommunication that consists solely of a telephone 

22 audio conversation, facsimile, electronic text mail, or 

23 consultation between two health care providers. 

24 (4) REPORT.—Not later than 18 months after 

25 the date of the enactment of this Act, the Secretary 


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1 of Health and Human Services shall submit to Con2 gress a report on the study conducted under para3 graph (1) and shall include in such report such rec4 ommendations for legislation or administration ac5 tion as the Secretary determines appropriate. 

6 (c) STUDY AND REPORT ON STORE AND FORWARD

7 TECHNOLOGY FOR TELEHEALTH.— 

8 (1) STUDY.—The Secretary of Health and 

9 Human Services, acting through the Director of the 

10 Office for the Advancement of Telehealth, shall con11 duct a study on the use of store and forward tech12 nologies (that provide for the asynchronous trans13 mission of health care information in single or multi14 media formats) in the provision of telehealth serv15 ices. Such study shall include an assessment of the 

16 feasibility, advisability, and the costs of expanding 

17 the use of such technologies for use in the diagnosis 

18 and treatment of certain health conditions, as speci19 fied by the Secretary. 

20 (2) REPORT.—Not later than 18 months after 

21 the date of the enactment of this Act, the Secretary 

22 of Health and Human Services shall submit to Con23 gress a report on the study conducted under para24 graph (1) and shall include in such report such recVerDate Nov 24 2008 19:15 Feb 14, 2009 Jkt 079200 PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 E:\BILLS\H1039.IH H1039

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1 ommendations for legislation or administration ac2 tion as the Secretary determines appropriate. 

3 SEC. 304. FQHCS INCLUDED IN ELECTRONIC HEALTH 

4 RECORDS DEMONSTRATION. 

5 Effective as of the date of the enactment of this Act, 

6 in developing and implementing a demonstration initiative 

7 to foster the implementation and adoption of electronic 

8 health records and health information technology, the 

9 Centers of Medicare & Medicaid Services shall provide for 

10 the eligibility of Federally qualified health centers (as de11 fined in section 1861(aa)(4) of the Social Security Act (42 

12 U.S.C. 1395x(aa)(4)) to participate in such demonstra13 tion. 

14 SEC. 305. INTEREST-FREE LOAN PROGRAM FOR HOSPITALS 

15 TO ADOPT HEALTH INFORMATION TECH16 NOLOGY. 

17 (a) IN GENERAL.—The Secretary of Health and 

18 Human Services (in this section referred to as the ‘‘Sec19 retary’’) shall establish a loan program that provides loans 

20 to hospitals to purchase and implement health information 

21 technology products certified pursuant to section 

22 101(c)(3)(B)(ii). 

23 (b) APPLICATION.—No loan may be provided under 

24 this section to a hospital except pursuant to an application 

25 that is submitted and approved in a time, manner, and 


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1 form specified by the Secretary. A loan under this section 

2 shall be on such terms and conditions and meet such re3 quirements as the Secretary determines appropriate, in ac4 cordance with the provisions of this section. 

5 (c) PERMISSIBLE USE OF LOAN FUNDS.—A loan 

6 provided under this section shall be used only for the pur7 chase and implementation of health information tech8 nology products certified pursuant to section 

9 1019c)(3)(B)(ii). 

10 (d) PREFERENCE.—In making loans under this sec11 tion, the Secretary shall give preference to any applicant 

12 for such a loan that is a hospital receiving a high amount 

13 of disproportionate share hospital payments under section 

14 1886(d)(5)(F) of the Social Security Act (42 U.S.C. 

15 1395ww(d)(5)(F)). 

16 (e) REPAYMENT OF LOANS.—The Secretary shall es17 tablish a schedule for the repayment of loans provided 

18 under this section. 

19 (f) NO INTEREST CHARGED.—The Secretary shall 

20 not charge or collect interest on any loan made under this 

21 section. 

22 (g) PENALTIES.—The Secretary shall establish pen23 alties to which a hospital receiving a loan under this sec24 tion would be subject if such hospital is in violation of 


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1 any of the terms, conditions, or requirements specified by 

2 the Secretary under subsection (b) or under this section. 

3 (h) FUNDING.— 

4 (1) AUTHORIZATION OF APPROPRIATIONS.—For 

5 purposes of carrying out this section, there are au6 thorized to be appropriated such sums as may be 

7 necessary for fiscal year 2009 and each succeeding 

8 fiscal year. 

9 (2) AVAILABILITY.—Amounts appropriated 

10 under paragraph (1) shall remain available until ex11 pended. 

12 (3) REPAID LOAN AMOUNTS.—Any amount re13 paid by, or recovered from, a hospital under this sec14 tion shall be credited to the appropriation account 

15 from which the loan amount involved was originally 

16 paid. Any amount so credited shall be available only 

17 for the purpose of carrying out the loan program 

18 under this section. 

Æ 


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