H. R. 3590 

One Hundred Eleventh Congress 

of the 

United States of America 

AT THE SECOND SESSION 

Begun and held at the City of Washington on Tuesday, 

the fifth day of January, two thousand and ten 

An Act 

Entitled The Patient Protection and Affordable Care Act. 

Be it enacted by the Senate and House of Representatives of 

the United States of America in Congress assembled, 

SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This Act may be cited as the ‘‘Patient Protection and Affordable Care Act’’. 

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

is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—QUALITY, AFFORDABLE HEALTH CARE FOR ALL AMERICANS 

Subtitle A—Immediate Improvements in Health Care Coverage for All Americans 

Sec. 1001. Amendments to the Public Health Service Act. 

‘‘PART A—INDIVIDUAL AND GROUP MARKET REFORMS

‘‘SUBPART II—IMPROVING COVERAGE

‘‘Sec. 2711. No lifetime or annual limits. 

‘‘Sec. 2712. Prohibition on rescissions. 

‘‘Sec. 2713. Coverage of preventive health services. 

‘‘Sec. 2714. Extension of dependent coverage. 

‘‘Sec. 2715. Development and utilization of uniform explanation of coverage 

documents and standardized definitions. 

‘‘Sec. 2716. Prohibition of discrimination based on salary. 

‘‘Sec. 2717. Ensuring the quality of care. 

‘‘Sec. 2718. Bringing down the cost of health care coverage. 

‘‘Sec. 2719. Appeals process. 

Sec. 1002. Health insurance consumer information. 

Sec. 1003. Ensuring that consumers get value for their dollars. 

Sec. 1004. Effective dates. 

Subtitle B—Immediate Actions to Preserve and Expand Coverage 

Sec. 1101. Immediate access to insurance for uninsured individuals with a preexisting condition. 

Sec. 1102. Reinsurance for early retirees. 

Sec. 1103. Immediate information that allows consumers to identify affordable coverage options. 

Sec. 1104. Administrative simplification. 

Sec. 1105. Effective date. 

Subtitle C—Quality Health Insurance Coverage for All Americans 

PART I—HEALTH INSURANCE MARKET REFORMS

Sec. 1201. Amendment to the Public Health Service Act. 

‘‘SUBPART I—GENERAL REFORM

‘‘Sec. 2704. Prohibition of preexisting condition exclusions or other discrimination based on health status. 

‘‘Sec. 2701. Fair health insurance premiums. 

‘‘Sec. 2702. Guaranteed availability of coverage. 
H. R. 3590—2 

‘‘Sec. 2703. Guaranteed renewability of coverage. 

‘‘Sec. 2705. Prohibiting discrimination against individual participants and 

beneficiaries based on health status. 

‘‘Sec. 2706. Non-discrimination in health care. 

‘‘Sec. 2707. Comprehensive health insurance coverage. 

‘‘Sec. 2708. Prohibition on excessive waiting periods. 

PART II—OTHER PROVISIONS

Sec. 1251. Preservation of right to maintain existing coverage. 

Sec. 1252. Rating reforms must apply uniformly to all health insurance issuers and 

group health plans. 

Sec. 1253. Effective dates. 

Subtitle D—Available Coverage Choices for All Americans 

PART I—ESTABLISHMENT OF QUALIFIED HEALTH PLANS

Sec. 1301. Qualified health plan defined. 

Sec. 1302. Essential health benefits requirements. 

Sec. 1303. Special rules. 

Sec. 1304. Related definitions. 

PART II—CONSUMER CHOICES AND INSURANCE COMPETITION THROUGH HEALTH

BENEFIT EXCHANGES

Sec. 1311. Affordable choices of health benefit plans. 

Sec. 1312. Consumer choice. 

Sec. 1313. Financial integrity. 

PART III—STATE FLEXIBILITY RELATING TO EXCHANGES

Sec. 1321. State flexibility in operation and enforcement of Exchanges and related 

requirements. 

Sec. 1322. Federal program to assist establishment and operation of nonprofit, 

member-run health insurance issuers. 

Sec. 1323. Community health insurance option. 

Sec. 1324. Level playing field. 

PART IV—STATE FLEXIBILITY TO ESTABLISH ALTERNATIVE PROGRAMS

Sec. 1331. State flexibility to establish basic health programs for low-income individuals not eligible for Medicaid. 

Sec. 1332. Waiver for State innovation. 

Sec. 1333. Provisions relating to offering of plans in more than one State. 

PART V—REINSURANCE AND RISK ADJUSTMENT

Sec. 1341. Transitional reinsurance program for individual and small group markets in each State. 

Sec. 1342. Establishment of risk corridors for plans in individual and small group 

markets. 

Sec. 1343. Risk adjustment. 

Subtitle E—Affordable Coverage Choices for All Americans 

PART I—PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS

SUBPART A—PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS

Sec. 1401. Refundable tax credit providing premium assistance for coverage under 

a qualified health plan. 

Sec. 1402. Reduced cost-sharing for individuals enrolling in qualified health plans. 

SUBPART B—ELIGIBILITY DETERMINATIONS

Sec. 1411. Procedures for determining eligibility for Exchange participation, premium tax credits and reduced cost-sharing, and individual responsibility 

exemptions. 

Sec. 1412. Advance determination and payment of premium tax credits and costsharing reductions. 

Sec. 1413. Streamlining of procedures for enrollment through an exchange and 

State Medicaid, CHIP, and health subsidy programs. 

Sec. 1414. Disclosures to carry out eligibility requirements for certain programs. 

Sec. 1415. Premium tax credit and cost-sharing reduction payments disregarded for 

Federal and Federally-assisted programs. 

PART II—SMALL BUSINESS TAX CREDIT

Sec. 1421. Credit for employee health insurance expenses of small businesses. 
H. R. 3590—3 

Subtitle F—Shared Responsibility for Health Care 

PART I—INDIVIDUAL RESPONSIBILITY

Sec. 1501. Requirement to maintain minimum essential coverage. 

Sec. 1502. Reporting of health insurance coverage. 

PART II—EMPLOYER RESPONSIBILITIES

Sec. 1511. Automatic enrollment for employees of large employers. 

Sec. 1512. Employer requirement to inform employees of coverage options. 

Sec. 1513. Shared responsibility for employers. 

Sec. 1514. Reporting of employer health insurance coverage. 

Sec. 1515. Offering of Exchange-participating qualified health plans through cafeteria plans. 

Subtitle G—Miscellaneous Provisions 

Sec. 1551. Definitions. 

Sec. 1552. Transparency in government. 

Sec. 1553. Prohibition against discrimination on assisted suicide. 

Sec. 1554. Access to therapies. 

Sec. 1555. Freedom not to participate in Federal health insurance programs. 

Sec. 1556. Equity for certain eligible survivors. 

Sec. 1557. Nondiscrimination. 

Sec. 1558. Protections for employees. 

Sec. 1559. Oversight. 

Sec. 1560. Rules of construction. 

Sec. 1561. Health information technology enrollment standards and protocols. 

Sec. 1562. Conforming amendments. 

Sec. 1563. Sense of the Senate promoting fiscal responsibility. 

TITLE II—ROLE OF PUBLIC PROGRAMS 

Subtitle A—Improved Access to Medicaid 

Sec. 2001. Medicaid coverage for the lowest income populations. 

Sec. 2002. Income eligibility for nonelderly determined using modified gross income. Sec. 2003. Requirement to offer premium assistance for employer-sponsored insurance. Sec. 2004. Medicaid coverage for former foster care children. 

Sec. 2005. Payments to territories. 

Sec. 2006. Special adjustment to FMAP determination for certain States recovering 

from a major disaster. 

Sec. 2007. Medicaid Improvement Fund rescission. 

Subtitle B—Enhanced Support for the Children’s Health Insurance Program 

Sec. 2101. Additional federal financial participation for CHIP. 

Sec. 2102. Technical corrections. 

Subtitle C—Medicaid and CHIP Enrollment Simplification 

Sec. 2201. Enrollment Simplification and coordination with State Health Insurance 

Exchanges. 

Sec. 2202. Permitting hospitals to make presumptive eligibility determinations for 

all Medicaid eligible populations. 

Subtitle D—Improvements to Medicaid Services 

Sec. 2301. Coverage for freestanding birth center services. 

Sec. 2302. Concurrent care for children. 

Sec. 2303. State eligibility option for family planning services. 

Sec. 2304. Clarification of definition of medical assistance. 

Subtitle E—New Options for States to Provide Long-Term Services and Supports 

Sec. 2401. Community First Choice Option. 

Sec. 2402. Removal of barriers to providing home and community-based services. 

Sec. 2403. Money Follows the Person Rebalancing Demonstration. 

Sec. 2404. Protection for recipients of home and community-based services against 

spousal impoverishment. 

Sec. 2405. Funding to expand State Aging and Disability Resource Centers. 

Sec. 2406. Sense of the Senate regarding long-term care. 

Subtitle F—Medicaid Prescription Drug Coverage 

Sec. 2501. Prescription drug rebates. 
H. R. 3590—4 

Sec. 2502. Elimination of exclusion of coverage of certain drugs. 

Sec. 2503. Providing adequate pharmacy reimbursement. 

Subtitle G—Medicaid Disproportionate Share Hospital (DSH) Payments 

Sec. 2551. Disproportionate share hospital payments. 

Subtitle H—Improved Coordination for Dual Eligible Beneficiaries 

Sec. 2601. 5-year period for demonstration projects. 

Sec. 2602. Providing Federal coverage and payment coordination for dual eligible 

beneficiaries. 

Subtitle I—Improving the Quality of Medicaid for Patients and Providers 

Sec. 2701. Adult health quality measures. 

Sec. 2702. Payment Adjustment for Health Care-Acquired Conditions. 

Sec. 2703. State option to provide health homes for enrollees with chronic conditions. 

Sec. 2704. Demonstration project to evaluate integrated care around a hospitalization. 

Sec. 2705. Medicaid Global Payment System Demonstration Project. 

Sec. 2706. Pediatric Accountable Care Organization Demonstration Project. 

Sec. 2707. Medicaid emergency psychiatric demonstration project. 

Subtitle J—Improvements to the Medicaid and CHIP Payment and Access 

Commission (MACPAC) 

Sec. 2801. MACPAC assessment of policies affecting all Medicaid beneficiaries. 

Subtitle K—Protections for American Indians and Alaska Natives 

Sec. 2901. Special rules relating to Indians. 

Sec. 2902. Elimination of sunset for reimbursement for all medicare part B services 

furnished by certain indian hospitals and clinics. 

Subtitle L—Maternal and Child Health Services 

Sec. 2951. Maternal, infant, and early childhood home visiting programs. 

Sec. 2952. Support, education, and research for postpartum depression. 

Sec. 2953. Personal responsibility education. 

Sec. 2954. Restoration of funding for abstinence education. 

Sec. 2955. Inclusion of information about the importance of having a health care 

power of attorney in transition planning for children aging out of foster 

care and independent living programs. 

TITLE III—IMPROVING THE QUALITY AND EFFICIENCY OF HEALTH CARE 

Subtitle A—Transforming the Health Care Delivery System 

PART I—LINKING PAYMENT TO QUALITY OUTCOMES UNDER THE MEDICARE PROGRAM

Sec. 3001. Hospital Value-Based purchasing program. 

Sec. 3002. Improvements to the physician quality reporting system. 

Sec. 3003. Improvements to the physician feedback program. 

Sec. 3004. Quality reporting for long-term care hospitals, inpatient rehabilitation 

hospitals, and hospice programs. 

Sec. 3005. Quality reporting for PPS-exempt cancer hospitals. 

Sec. 3006. Plans for a Value-Based purchasing program for skilled nursing facilities 

and home health agencies. 

Sec. 3007. Value-based payment modifier under the physician fee schedule. 

Sec. 3008. Payment adjustment for conditions acquired in hospitals. 

PART II—NATIONAL STRATEGY TO IMPROVE HEALTH CARE QUALITY

Sec. 3011. National strategy. 

Sec. 3012. Interagency Working Group on Health Care Quality. 

Sec. 3013. Quality measure development. 

Sec. 3014. Quality measurement. 

Sec. 3015. Data collection; public reporting. 

PART III—ENCOURAGING DEVELOPMENT OF NEW PATIENT CARE MODELS

Sec. 3021. Establishment of Center for Medicare and Medicaid Innovation within 

CMS. 

Sec. 3022. Medicare shared savings program. 

Sec. 3023. National pilot program on payment bundling. 

Sec. 3024. Independence at home demonstration program. 

Sec. 3025. Hospital readmissions reduction program. 
H. R. 3590—5 

Sec. 3026. Community-Based Care Transitions Program. 

Sec. 3027. Extension of gainsharing demonstration. 

Subtitle B—Improving Medicare for Patients and Providers 

PART I—ENSURING BENEFICIARY ACCESS TO PHYSICIAN CARE AND OTHER SERVICES

Sec. 3101. Increase in the physician payment update. 

Sec. 3102. Extension of the work geographic index floor and revisions to the practice expense geographic adjustment under the Medicare physician fee 

schedule. 

Sec. 3103. Extension of exceptions process for Medicare therapy caps. 

Sec. 3104. Extension of payment for technical component of certain physician pathology services. 

Sec. 3105. Extension of ambulance add-ons. 

Sec. 3106. Extension of certain payment rules for long-term care hospital services 

and of moratorium on the establishment of certain hospitals and facilities. 

Sec. 3107. Extension of physician fee schedule mental health add-on. 

Sec. 3108. Permitting physician assistants to order post-Hospital extended care 

services. 

Sec. 3109. Exemption of certain pharmacies from accreditation requirements. 

Sec. 3110. Part B special enrollment period for disabled TRICARE beneficiaries. 

Sec. 3111. Payment for bone density tests. 

Sec. 3112. Revision to the Medicare Improvement Fund. 

Sec. 3113. Treatment of certain complex diagnostic laboratory tests. 

Sec. 3114. Improved access for certified nurse-midwife services. 

PART II—RURAL PROTECTIONS

Sec. 3121. Extension of outpatient hold harmless provision. 

Sec. 3122. Extension of Medicare reasonable costs payments for certain clinical diagnostic laboratory tests furnished to hospital patients in certain rural 

areas. Sec. 3123. Extension of the Rural Community Hospital Demonstration Program. 

Sec. 3124. Extension of the Medicare-dependent hospital (MDH) program. 

Sec. 3125. Temporary improvements to the Medicare inpatient hospital payment 

adjustment for low-volume hospitals. 

Sec. 3126. Improvements to the demonstration project on community health integration models in certain rural counties. 

Sec. 3127. MedPAC study on adequacy of Medicare payments for health care providers serving in rural areas. 

Sec. 3128. Technical correction related to critical access hospital services. 

Sec. 3129. Extension of and revisions to Medicare rural hospital flexibility program. 

PART III—IMPROVING PAYMENT ACCURACY

Sec. 3131. Payment adjustments for home health care. 

Sec. 3132. Hospice reform. 

Sec. 3133. Improvement to medicare disproportionate share hospital (DSH) payments. 

Sec. 3134. Misvalued codes under the physician fee schedule. 

Sec. 3135. Modification of equipment utilization factor for advanced imaging services. 

Sec. 3136. Revision of payment for power-driven wheelchairs. 

Sec. 3137. Hospital wage index improvement. 

Sec. 3138. Treatment of certain cancer hospitals. 

Sec. 3139. Payment for biosimilar biological products. 

Sec. 3140. Medicare hospice concurrent care demonstration program. 

Sec. 3141. Application of budget neutrality on a national basis in the calculation of 

the Medicare hospital wage index floor. 

Sec. 3142. HHS study on urban Medicare-dependent hospitals. 

Sec. 3143. Protecting home health benefits. 

Subtitle C—Provisions Relating to Part C 

Sec. 3201. Medicare Advantage payment. 

Sec. 3202. Benefit protection and simplification. 

Sec. 3203. Application of coding intensity adjustment during MA payment transition. 

Sec. 3204. Simplification of annual beneficiary election periods. 

Sec. 3205. Extension for specialized MA plans for special needs individuals. 

Sec. 3206. Extension of reasonable cost contracts. 

Sec. 3207. Technical correction to MA private fee-for-service plans. 

Sec. 3208. Making senior housing facility demonstration permanent. 
H. R. 3590—6 

Sec. 3209. Authority to deny plan bids. 

Sec. 3210. Development of new standards for certain Medigap plans. 

Subtitle D—Medicare Part D Improvements for Prescription Drug Plans and MA– 

PD Plans 

Sec. 3301. Medicare coverage gap discount program. 

Sec. 3302. Improvement in determination of Medicare part D low-income benchmark premium. 

Sec. 3303. Voluntary de minimis policy for subsidy eligible individuals under prescription drug plans and MA–PD plans. 

Sec. 3304. Special rule for widows and widowers regarding eligibility for low-income assistance. 

Sec. 3305. Improved information for subsidy eligible individuals reassigned to prescription drug plans and MA–PD plans. 

Sec. 3306. Funding outreach and assistance for low-income programs. 

Sec. 3307. Improving formulary requirements for prescription drug plans and MA– 

PD plans with respect to certain categories or classes of drugs. 

Sec. 3308. Reducing part D premium subsidy for high-income beneficiaries. 

Sec. 3309. Elimination of cost sharing for certain dual eligible individuals. 

Sec. 3310. Reducing wasteful dispensing of outpatient prescription drugs in longterm care facilities under prescription drug plans and MA–PD plans. 

Sec. 3311. Improved Medicare prescription drug plan and MA–PD plan complaint 

system. 

Sec. 3312. Uniform exceptions and appeals process for prescription drug plans and 

MA–PD plans. 

Sec. 3313. Office of the Inspector General studies and reports. 

Sec. 3314. Including costs incurred by AIDS drug assistance programs and Indian 

Health Service in providing prescription drugs toward the annual outof-pocket threshold under part D. 

Sec. 3315. Immediate reduction in coverage gap in 2010. 

Subtitle E—Ensuring Medicare Sustainability 

Sec. 3401. Revision of certain market basket updates and incorporation of productivity improvements into market basket updates that do not already incorporate such improvements. 

Sec. 3402. Temporary adjustment to the calculation of part B premiums. 

Sec. 3403. Independent Medicare Advisory Board. 

Subtitle F—Health Care Quality Improvements 

Sec. 3501. Health care delivery system research; Quality improvement technical assistance. 

Sec. 3502. Establishing community health teams to support the patient-centered 

medical home. 

Sec. 3503. Medication management services in treatment of chronic disease. 

Sec. 3504. Design and implementation of regionalized systems for emergency care. 

Sec. 3505. Trauma care centers and service availability. 

Sec. 3506. Program to facilitate shared decisionmaking. 

Sec. 3507. Presentation of prescription drug benefit and risk information. 

Sec. 3508. Demonstration program to integrate quality improvement and patient 

safety training into clinical education of health professionals. 

Sec. 3509. Improving women’s health. 

Sec. 3510. Patient navigator program. 

Sec. 3511. Authorization of appropriations. 

Subtitle G—Protecting and Improving Guaranteed Medicare Benefits 

Sec. 3601. Protecting and improving guaranteed Medicare benefits. 

Sec. 3602. No cuts in guaranteed benefits. 

TITLE IV—PREVENTION OF CHRONIC DISEASE AND IMPROVING PUBLIC 

HEALTH 

Subtitle A—Modernizing Disease Prevention and Public Health Systems 

Sec. 4001. National Prevention, Health Promotion and Public Health Council. 

Sec. 4002. Prevention and Public Health Fund. 

Sec. 4003. Clinical and community preventive services. 

Sec. 4004. Education and outreach campaign regarding preventive benefits. 

Subtitle B—Increasing Access to Clinical Preventive Services 

Sec. 4101. School-based health centers. 

Sec. 4102. Oral healthcare prevention activities. 
H. R. 3590—7 

Sec. 4103. Medicare coverage of annual wellness visit providing a personalized prevention plan. 

Sec. 4104. Removal of barriers to preventive services in Medicare. 

Sec. 4105. Evidence-based coverage of preventive services in Medicare. 

Sec. 4106. Improving access to preventive services for eligible adults in Medicaid. 

Sec. 4107. Coverage of comprehensive tobacco cessation services for pregnant 

women in Medicaid. 

Sec. 4108. Incentives for prevention of chronic diseases in medicaid. 

Subtitle C—Creating Healthier Communities 

Sec. 4201. Community transformation grants. 

Sec. 4202. Healthy aging, living well; evaluation of community-based prevention 

and wellness programs for Medicare beneficiaries. 

Sec. 4203. Removing barriers and improving access to wellness for individuals with 

disabilities. 

Sec. 4204. Immunizations. 

Sec. 4205. Nutrition labeling of standard menu items at chain restaurants. 

Sec. 4206. Demonstration project concerning individualized wellness plan. 

Sec. 4207. Reasonable break time for nursing mothers. 

Subtitle D—Support for Prevention and Public Health Innovation 

Sec. 4301. Research on optimizing the delivery of public health services. 

Sec. 4302. Understanding health disparities: data collection and analysis. 

Sec. 4303. CDC and employer-based wellness programs. 

Sec. 4304. Epidemiology-Laboratory Capacity Grants. 

Sec. 4305. Advancing research and treatment for pain care management. 

Sec. 4306. Funding for Childhood Obesity Demonstration Project. 

Subtitle E—Miscellaneous Provisions 

Sec. 4401. Sense of the Senate concerning CBO scoring. 

Sec. 4402. Effectiveness of Federal health and wellness initiatives. 

TITLE V—HEALTH CARE WORKFORCE 

Subtitle A—Purpose and Definitions 

Sec. 5001. Purpose. 

Sec. 5002. Definitions. 

Subtitle B—Innovations in the Health Care Workforce 

Sec. 5101. National health care workforce commission. 

Sec. 5102. State health care workforce development grants. 

Sec. 5103. Health care workforce assessment. 

Subtitle C—Increasing the Supply of the Health Care Workforce 

Sec. 5201. Federally supported student loan funds. 

Sec. 5202. Nursing student loan program. 

Sec. 5203. Health care workforce loan repayment programs. 

Sec. 5204. Public health workforce recruitment and retention programs. 

Sec. 5205. Allied health workforce recruitment and retention programs. 

Sec. 5206. Grants for State and local programs. 

Sec. 5207. Funding for National Health Service Corps. 

Sec. 5208. Nurse-managed health clinics. 

Sec. 5209. Elimination of cap on commissioned corps. 

Sec. 5210. Establishing a Ready Reserve Corps. 

Subtitle D—Enhancing Health Care Workforce Education and Training 

Sec. 5301. Training in family medicine, general internal medicine, general pediatrics, and physician assistantship. 

Sec. 5302. Training opportunities for direct care workers. 

Sec. 5303. Training in general, pediatric, and public health dentistry. 

Sec. 5304. Alternative dental health care providers demonstration project. 

Sec. 5305. Geriatric education and training; career awards; comprehensive geriatric 

education. 

Sec. 5306. Mental and behavioral health education and training grants. 

Sec. 5307. Cultural competency, prevention, and public health and individuals with 

disabilities training. 

Sec. 5308. Advanced nursing education grants. 

Sec. 5309. Nurse education, practice, and retention grants. 

Sec. 5310. Loan repayment and scholarship program. 

Sec. 5311. Nurse faculty loan program. 
H. R. 3590—8 

Sec. 5312. Authorization of appropriations for parts B through D of title VIII. 

Sec. 5313. Grants to promote the community health workforce. 

Sec. 5314. Fellowship training in public health. 

Sec. 5315. United States Public Health Sciences Track. 

Subtitle E—Supporting the Existing Health Care Workforce 

Sec. 5401. Centers of excellence. 

Sec. 5402. Health care professionals training for diversity. 

Sec. 5403. Interdisciplinary, community-based linkages. 

Sec. 5404. Workforce diversity grants. 

Sec. 5405. Primary care extension program. 

Subtitle F—Strengthening Primary Care and Other Workforce Improvements 

Sec. 5501. Expanding access to primary care services and general surgery services. 

Sec. 5502. Medicare Federally qualified health center improvements. 

Sec. 5503. Distribution of additional residency positions. 

Sec. 5504. Counting resident time in nonprovider settings. 

Sec. 5505. Rules for counting resident time for didactic and scholarly activities and 

other activities. 

Sec. 5506. Preservation of resident cap positions from closed hospitals. 

Sec. 5507. Demonstration projects To address health professions workforce needs; 

extension of family-to-family health information centers. 

Sec. 5508. Increasing teaching capacity. 

Sec. 5509. Graduate nurse education demonstration. 

Subtitle G—Improving Access to Health Care Services 

Sec. 5601. Spending for Federally Qualified Health Centers (FQHCs). 

Sec. 5602. Negotiated rulemaking for development of methodology and criteria for 

designating medically underserved populations and health professions 

shortage areas. 

Sec. 5603. Reauthorization of the Wakefield Emergency Medical Services for Children Program. 

Sec. 5604. Co-locating primary and specialty care in community-based mental 

health settings. 

Sec. 5605. Key National indicators. 

Subtitle H—General Provisions 

Sec. 5701. Reports. 

TITLE VI—TRANSPARENCY AND PROGRAM INTEGRITY 

Subtitle A—Physician Ownership and Other Transparency 

Sec. 6001. Limitation on Medicare exception to the prohibition on certain physician 

referrals for hospitals. 

Sec. 6002. Transparency reports and reporting of physician ownership or investment interests. 

Sec. 6003. Disclosure requirements for in-office ancillary services exception to the 

prohibition on physician self-referral for certain imaging services. 

Sec. 6004. Prescription drug sample transparency. 

Sec. 6005. Pharmacy benefit managers transparency requirements. 

Subtitle B—Nursing Home Transparency and Improvement 

PART I—IMPROVING TRANSPARENCY OF INFORMATION

Sec. 6101. Required disclosure of ownership and additional disclosable parties information. 

Sec. 6102. Accountability requirements for skilled nursing facilities and nursing facilities. 

Sec. 6103. Nursing home compare Medicare website. 

Sec. 6104. Reporting of expenditures. 

Sec. 6105. Standardized complaint form. 

Sec. 6106. Ensuring staffing accountability. 

Sec. 6107. GAO study and report on Five-Star Quality Rating System. 

PART II—TARGETING ENFORCEMENT

Sec. 6111. Civil money penalties. 

Sec. 6112. National independent monitor demonstration project. 

Sec. 6113. Notification of facility closure. 

Sec. 6114. National demonstration projects on culture change and use of information technology in nursing homes. 
H. R. 3590—9 

PART III—IMPROVING STAFF TRAINING

Sec. 6121. Dementia and abuse prevention training. 

Subtitle C—Nationwide Program for National and State Background Checks on 

Direct Patient Access Employees of Long-term Care Facilities and Providers 

Sec. 6201. Nationwide program for National and State background checks on direct 

patient access employees of long-term care facilities and providers. 

Subtitle D—Patient-Centered Outcomes Research 

Sec. 6301. Patient-Centered Outcomes Research. 

Sec. 6302. Federal coordinating council for comparative effectiveness research. 

Subtitle E—Medicare, Medicaid, and CHIP Program Integrity Provisions 

Sec. 6401. Provider screening and other enrollment requirements under Medicare, 

Medicaid, and CHIP. 

Sec. 6402. Enhanced Medicare and Medicaid program integrity provisions. 

Sec. 6403. Elimination of duplication between the Healthcare Integrity and Protection Data Bank and the National Practitioner Data Bank. 

Sec. 6404. Maximum period for submission of Medicare claims reduced to not more 

than 12 months. 

Sec. 6405. Physicians who order items or services required to be Medicare enrolled 

physicians or eligible professionals. 

Sec. 6406. Requirement for physicians to provide documentation on referrals to programs at high risk of waste and abuse. 

Sec. 6407. Face to face encounter with patient required before physicians may certify eligibility for home health services or durable medical equipment 

under Medicare. 

Sec. 6408. Enhanced penalties. 

Sec. 6409. Medicare self-referral disclosure protocol. 

Sec. 6410. Adjustments to the Medicare durable medical equipment, prosthetics, 

orthotics, and supplies competitive acquisition program. 

Sec. 6411. Expansion of the Recovery Audit Contractor (RAC) program. 

Subtitle F—Additional Medicaid Program Integrity Provisions 

Sec. 6501. Termination of provider participation under Medicaid if terminated 

under Medicare or other State plan. 

Sec. 6502. Medicaid exclusion from participation relating to certain ownership, control, and management affiliations. 

Sec. 6503. Billing agents, clearinghouses, or other alternate payees required to register under Medicaid. 

Sec. 6504. Requirement to report expanded set of data elements under MMIS to detect fraud and abuse. 

Sec. 6505. Prohibition on payments to institutions or entities located outside of the 

United States. 

Sec. 6506. Overpayments. 

Sec. 6507. Mandatory State use of national correct coding initiative. 

Sec. 6508. General effective date. 

Subtitle G—Additional Program Integrity Provisions 

Sec. 6601. Prohibition on false statements and representations. 

Sec. 6602. Clarifying definition. 

Sec. 6603. Development of model uniform report form. 

Sec. 6604. Applicability of State law to combat fraud and abuse. 

Sec. 6605. Enabling the Department of Labor to issue administrative summary 

cease and desist orders and summary seizures orders against plans that 

are in financially hazardous condition. 

Sec. 6606. MEWA plan registration with Department of Labor. 

Sec. 6607. Permitting evidentiary privilege and confidential communications. 

Subtitle H—Elder Justice Act 

Sec. 6701. Short title of subtitle. 

Sec. 6702. Definitions. 

Sec. 6703. Elder Justice. 

Subtitle I—Sense of the Senate Regarding Medical Malpractice 

Sec. 6801. Sense of the Senate regarding medical malpractice. 

TITLE VII—IMPROVING ACCESS TO INNOVATIVE MEDICAL THERAPIES 

Subtitle A—Biologics Price Competition and Innovation 

Sec. 7001. Short title. 
H. R. 3590—10 

Sec. 7002. Approval pathway for biosimilar biological products. 

Sec. 7003. Savings. 

Subtitle B—More Affordable Medicines for Children and Underserved Communities 

Sec. 7101. Expanded participation in 340B program. 

Sec. 7102. Improvements to 340B program integrity. 

Sec. 7103. GAO study to make recommendations on improving the 340B program. 

TITLE VIII—CLASS ACT 

Sec. 8001. Short title of title. 

Sec. 8002. Establishment of national voluntary insurance program for purchasing 

community living assistance services and support. 

TITLE IX—REVENUE PROVISIONS 

Subtitle A—Revenue Offset Provisions 

Sec. 9001. Excise tax on high cost employer-sponsored health coverage. 

Sec. 9002. Inclusion of cost of employer-sponsored health coverage on W–2. 

Sec. 9003. Distributions for medicine qualified only if for prescribed drug or insulin. 

Sec. 9004. Increase in additional tax on distributions from HSAs and Archer MSAs 

not used for qualified medical expenses. 

Sec. 9005. Limitation on health flexible spending arrangements under cafeteria 

plans. 

Sec. 9006. Expansion of information reporting requirements. 

Sec. 9007. Additional requirements for charitable hospitals. 

Sec. 9008. Imposition of annual fee on branded prescription pharmaceutical manufacturers and importers. 

Sec. 9009. Imposition of annual fee on medical device manufacturers and importers. Sec. 9010. Imposition of annual fee on health insurance providers. 

Sec. 9011. Study and report of effect on veterans health care. 

Sec. 9012. Elimination of deduction for expenses allocable to Medicare Part D subsidy. 

Sec. 9013. Modification of itemized deduction for medical expenses. 

Sec. 9014. Limitation on excessive remuneration paid by certain health insurance 

providers. 

Sec. 9015. Additional hospital insurance tax on high-income taxpayers. 

Sec. 9016. Modification of section 833 treatment of certain health organizations. 

Sec. 9017. Excise tax on elective cosmetic medical procedures. 

Subtitle B—Other Provisions 

Sec. 9021. Exclusion of health benefits provided by Indian tribal governments. 

Sec. 9022. Establishment of simple cafeteria plans for small businesses. 

Sec. 9023. Qualifying therapeutic discovery project credit. 

TITLE X—STRENGTHENING QUALITY, AFFORDABLE HEALTH CARE FOR 

ALL AMERICANS 

Subtitle A—Provisions Relating to Title I 

Sec. 10101. Amendments to subtitle A. 

Sec. 10102. Amendments to subtitle B. 

Sec. 10103. Amendments to subtitle C. 

Sec. 10104. Amendments to subtitle D. 

Sec. 10105. Amendments to subtitle E. 

Sec. 10106. Amendments to subtitle F. 

Sec. 10107. Amendments to subtitle G. 

Sec. 10108. Free choice vouchers. 

Sec. 10109. Development of standards for financial and administrative transactions. 

Subtitle B—Provisions Relating to Title II 

PART I—MEDICAID AND CHIP 

Sec. 10201. Amendments to the Social Security Act and title II of this Act. 

Sec. 10202. Incentives for States to offer home and community-based services as a 

long-term care alternative to nursing homes. 

Sec. 10203. Extension of funding for CHIP through fiscal year 2015 and other 

CHIP-related provisions. 

PART II—SUPPORT FOR PREGNANT AND PARENTING TEENS AND WOMEN

Sec. 10211. Definitions. 
H. R. 3590—11 

Sec. 10212. Establishment of pregnancy assistance fund. 

Sec. 10213. Permissible uses of Fund. 

Sec. 10214. Appropriations. 

PART III—INDIAN HEALTH CARE IMPROVEMENT

Sec. 10221. Indian health care improvement. 

Subtitle C—Provisions Relating to Title III 

Sec. 10301. Plans for a Value-Based purchasing program for ambulatory surgical 

centers. 

Sec. 10302. Revision to national strategy for quality improvement in health care. 

Sec. 10303. Development of outcome measures. 

Sec. 10304. Selection of efficiency measures. 

Sec. 10305. Data collection; public reporting. 

Sec. 10306. Improvements under the Center for Medicare and Medicaid Innovation. 

Sec. 10307. Improvements to the Medicare shared savings program. 

Sec. 10308. Revisions to national pilot program on payment bundling. 

Sec. 10309. Revisions to hospital readmissions reduction program. 

Sec. 10310. Repeal of physician payment update. 

Sec. 10311. Revisions to extension of ambulance add-ons. 

Sec. 10312. Certain payment rules for long-term care hospital services and moratorium on the establishment of certain hospitals and facilities. Sec. 10313. Revisions to the extension for the rural community hospital demonstration program. Sec. 10314. Adjustment to low-volume hospital provision. 

Sec. 10315. Revisions to home health care provisions. 

Sec. 10316. Medicare DSH. 

Sec. 10317. Revisions to extension of section 508 hospital provisions. 

Sec. 10318. Revisions to transitional extra benefits under Medicare Advantage. 

Sec. 10319. Revisions to market basket adjustments. 

Sec. 10320. Expansion of the scope of, and additional improvements to, the Independent Medicare Advisory Board. Sec. 10321. Revision to community health teams. 

Sec. 10322. Quality reporting for psychiatric hospitals. 

Sec. 10323. Medicare coverage for individuals exposed to environmental health hazards. 

Sec. 10324. Protections for frontier States. 

Sec. 10325. Revision to skilled nursing facility prospective payment system. 

Sec. 10326. Pilot testing pay-for-performance programs for certain Medicare providers. 

Sec. 10327. Improvements to the physician quality reporting system. 

Sec. 10328. Improvement in part D medication therapy management (MTM) programs. Sec. 10329. Developing methodology to assess health plan value. 

Sec. 10330. Modernizing computer and data systems of the Centers for Medicare & 

Medicaid services to support improvements in care delivery. Sec. 10331. Public reporting of performance information. 

Sec. 10332. Availability of medicare data for performance measurement. 

Sec. 10333. Community-based collaborative care networks. 

Sec. 10334. Minority health. 

Sec. 10335. Technical correction to the hospital value-based purchasing program. 

Sec. 10336. GAO study and report on Medicare beneficiary access to high-quality 

dialysis services. 

Subtitle D—Provisions Relating to Title IV 

Sec. 10401. Amendments to subtitle A. 

Sec. 10402. Amendments to subtitle B. 

Sec. 10403. Amendments to subtitle C. 

Sec. 10404. Amendments to subtitle D. 

Sec. 10405. Amendments to subtitle E. 

Sec. 10406. Amendment relating to waiving coinsurance for preventive services. 

Sec. 10407. Better diabetes care. 

Sec. 10408. Grants for small businesses to provide comprehensive workplace 

wellness programs. Sec. 10409. Cures Acceleration Network. 

Sec. 10410. Centers of Excellence for Depression. 

Sec. 10411. Programs relating to congenital heart disease. 

Sec. 10412. Automated Defibrillation in Adam’s Memory Act. 

Sec. 10413. Young women’s breast health awareness and support of young women 

diagnosed with breast cancer. 

Subtitle E—Provisions Relating to Title V 

Sec. 10501. Amendments to the Public Health Service Act, the Social Security Act, 

and title V of this Act. 
H. R. 3590—12 

Sec. 10502. Infrastructure to Expand Access to Care. 

Sec. 10503. Community Health Centers and the National Health Service Corps 

Fund. 

Sec. 10504. Demonstration project to provide access to affordable care. 

Subtitle F—Provisions Relating to Title VI 

Sec. 10601. Revisions to limitation on medicare exception to the prohibition on certain physician referrals for hospitals. 

Sec. 10602. Clarifications to patient-centered outcomes research. 

Sec. 10603. Striking provisions relating to individual provider application fees. 

Sec. 10604. Technical correction to section 6405. 

Sec. 10605. Certain other providers permitted to conduct face to face encounter for 

home health services. 

Sec. 10606. Health care fraud enforcement. 

Sec. 10607. State demonstration programs to evaluate alternatives to current medical tort litigation. 

Sec. 10608. Extension of medical malpractice coverage to free clinics. 

Sec. 10609. Labeling changes. 

Subtitle G—Provisions Relating to Title VIII 

Sec. 10801. Provisions relating to title VIII. 

Subtitle H—Provisions Relating to Title IX 

Sec. 10901. Modifications to excise tax on high cost employer-sponsored health coverage. 

Sec. 10902. Inflation adjustment of limitation on health flexible spending arrangements under cafeteria plans. 

Sec. 10903. Modification of limitation on charges by charitable hospitals. 

Sec. 10904. Modification of annual fee on medical device manufacturers and importers. 

Sec. 10905. Modification of annual fee on health insurance providers. 

Sec. 10906. Modifications to additional hospital insurance tax on high-income taxpayers. 

Sec. 10907. Excise tax on indoor tanning services in lieu of elective cosmetic medical procedures. 

Sec. 10908. Exclusion for assistance provided to participants in State student loan 

repayment programs for certain health professionals. 

Sec. 10909. Expansion of adoption credit and adoption assistance programs. 

TITLE I—QUALITY, AFFORDABLE 

HEALTH CARE FOR ALL AMERICANS 

Subtitle A—Immediate Improvements in 

Health Care Coverage for All Americans 

SEC. 1001. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT. 

Part A of title XXVII of the Public Health Service Act (42 

U.S.C. 300gg et seq.) is amended— 

(1) by striking the part heading and inserting the following: 

‘‘PART A—INDIVIDUAL AND GROUP MARKET 

REFORMS’’; 

(2) by redesignating sections 2704 through 2707 as sections 

2725 through 2728, respectively; 

(3) by redesignating sections 2711 through 2713 as sections 

2731 through 2733, respectively; 

(4) by redesignating sections 2721 through 2723 as sections 

2735 through 2737, respectively; and 

(5) by inserting after section 2702, the following: 
H. R. 3590—13 

‘‘Subpart II—Improving Coverage 

‘‘SEC. 2711. NO LIFETIME OR ANNUAL LIMITS. 

‘‘(a) IN GENERAL.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage may 

not establish— 

‘‘(1) lifetime limits on the dollar value of benefits for any 

participant or beneficiary; or 

‘‘(2) unreasonable annual limits (within the meaning of 

section 223 of the Internal Revenue Code of 1986) on the 

dollar value of benefits for any participant or beneficiary. 

‘‘(b) PER BENEFICIARY LIMITS.—Subsection (a) shall not be construed to prevent a group health plan or health insurance coverage 

that is not required to provide essential health benefits under 

section 1302(b) of the Patient Protection and Affordable Care Act 

from placing annual or lifetime per beneficiary limits on specific 

covered benefits to the extent that such limits are otherwise permitted under Federal or State law. 

‘‘SEC. 2712. PROHIBITION ON RESCISSIONS. 

‘‘A group health plan and a health insurance issuer offering 

group or individual health insurance coverage shall not rescind 

such plan or coverage with respect to an enrollee once the enrollee 

is covered under such plan or coverage involved, except that this 

section shall not apply to a covered individual who has performed 

an act or practice that constitutes fraud or makes an intentional 

misrepresentation of material fact as prohibited by the terms of 

the plan or coverage. Such plan or coverage may not be cancelled 

except with prior notice to the enrollee, and only as permitted 

under section 2702(c) or 2742(b). 

‘‘SEC. 2713. COVERAGE OF PREVENTIVE HEALTH SERVICES. 

‘‘(a) IN GENERAL.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage shall, 

at a minimum provide coverage for and shall not impose any 

cost sharing requirements for— 

‘‘(1) evidence-based items or services that have in effect 

a rating of ‘A’ or ‘B’ in the current recommendations of the 

United States Preventive Services Task Force; 

‘‘(2) immunizations that have in effect a recommendation 

from the Advisory Committee on Immunization Practices of 

the Centers for Disease Control and Prevention with respect 

to the individual involved; and 

‘‘(3) with respect to infants, children, and adolescents, evidence-informed preventive care and screenings provided for 

in the comprehensive guidelines supported by the Health 

Resources and Services Administration. 

‘‘(4) with respect to women, such additional preventive 

care and screenings not described in paragraph (1) as provided 

for in comprehensive guidelines supported by the Health 

Resources and Services Administration for purposes of this 

paragraph. 

‘‘(5) for the purposes of this Act, and for the purposes 

of any other provision of law, the current recommendations 

of the United States Preventive Service Task Force regarding 

breast cancer screening, mammography, and prevention shall 
H. R. 3590—14 

be considered the most current other than those issued in 

or around November 2009. 

Nothing in this subsection shall be construed to prohibit a plan 

or issuer from providing coverage for services in addition to those 

recommended by United States Preventive Services Task Force 

or to deny coverage for services that are not recommended by 

such Task Force. 

‘‘(b) INTERVAL.— ‘‘(1) IN GENERAL.—The Secretary shall establish a minimum 

interval between the date on which a recommendation described 

in subsection (a)(1) or (a)(2) or a guideline under subsection 

(a)(3) is issued and the plan year with respect to which the 

requirement described in subsection (a) is effective with respect 

to the service described in such recommendation or guideline. 

‘‘(2) MINIMUM.—The interval described in paragraph (1) 

shall not be less than 1 year. 

‘‘(c) VALUE-BASED INSURANCE DESIGN.—The Secretary may 

develop guidelines to permit a group health plan and a health 

insurance issuer offering group or individual health insurance coverage to utilize value-based insurance designs. 

‘‘SEC. 2714. EXTENSION OF DEPENDENT COVERAGE. 

‘‘(a) IN GENERAL.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage that 

provides dependent coverage of children shall continue to make 

such coverage available for an adult child (who is not married) 

until the child turns 26 years of age. Nothing in this section shall 

require a health plan or a health insurance issuer described in 

the preceding sentence to make coverage available for a child of 

a child receiving dependent coverage. 

‘‘(b) REGULATIONS.—The Secretary shall promulgate regulations 

to define the dependents to which coverage shall be made available 

under subsection (a). 

‘‘(c) RULE OF CONSTRUCTION.—Nothing in this section shall 

be construed to modify the definition of ‘dependent’ as used in 

the Internal Revenue Code of 1986 with respect to the tax treatment 

of the cost of coverage. 

‘‘SEC. 2715. DEVELOPMENT AND UTILIZATION OF UNIFORM EXPLANATION OF COVERAGE DOCUMENTS AND STANDARDIZED 

DEFINITIONS. 

‘‘(a) IN GENERAL.—Not later than 12 months after the date 

of enactment of the Patient Protection and Affordable Care Act, 

the Secretary shall develop standards for use by a group health 

plan and a health insurance issuer offering group or individual 

health insurance coverage, in compiling and providing to enrollees 

a summary of benefits and coverage explanation that accurately 

describes the benefits and coverage under the applicable plan or 

coverage. In developing such standards, the Secretary shall consult 

with the National Association of Insurance Commissioners (referred 

to in this section as the ‘NAIC’), a working group composed of 

representatives of health insurance-related consumer advocacy 

organizations, health insurance issuers, health care professionals, 

patient advocates including those representing individuals with limited English proficiency, and other qualified individuals. 

‘‘(b) REQUIREMENTS.—The standards for the summary of benefits and coverage developed under subsection (a) shall provide for 

the following: 
H. R. 3590—15 

‘‘(1) APPEARANCE.—The standards shall ensure that the 

summary of benefits and coverage is presented in a uniform 

format that does not exceed 4 pages in length and does not 

include print smaller than 12-point font. 

‘‘(2) LANGUAGE.—The standards shall ensure that the summary is presented in a culturally and linguistically appropriate 

manner and utilizes terminology understandable by the average 

plan enrollee. 

‘‘(3) CONTENTS.—The standards shall ensure that the summary of benefits and coverage includes— 

‘‘(A) uniform definitions of standard insurance terms 

and medical terms (consistent with subsection (g)) so that 

consumers may compare health insurance coverage and 

understand the terms of coverage (or exception to such 

coverage); 

‘‘(B) a description of the coverage, including cost 

sharing for— 

‘‘(i) each of the categories of the essential health 

benefits described in subparagraphs (A) through (J) 

of section 1302(b)(1) of the Patient Protection and 

Affordable Care Act; and 

‘‘(ii) other benefits, as identified by the Secretary; 

‘‘(C) the exceptions, reductions, and limitations on coverage; 

‘‘(D) the cost-sharing provisions, including deductible, 

coinsurance, and co-payment obligations; 

‘‘(E) the renewability and continuation of coverage 

provisions; 

‘‘(F) a coverage facts label that includes examples to 

illustrate common benefits scenarios, including pregnancy 

and serious or chronic medical conditions and related cost 

sharing, such scenarios to be based on recognized clinical 

practice guidelines; 

‘‘(G) a statement of whether the plan or coverage— 

‘‘(i) provides minimum essential coverage (as 

defined under section 5000A(f) of the Internal Revenue 

Code 1986); and 

‘‘(ii) ensures that the plan or coverage share of 

the total allowed costs of benefits provided under the 

plan or coverage is not less than 60 percent of such 

costs; 

‘‘(H) a statement that the outline is a summary of 

the policy or certificate and that the coverage document 

itself should be consulted to determine the governing 

contractual provisions; and 

‘‘(I) a contact number for the consumer to call with 

additional questions and an Internet web address where 

a copy of the actual individual coverage policy or group 

certificate of coverage can be reviewed and obtained. 

‘‘(c) PERIODIC REVIEW AND UPDATING.—The Secretary shall 

periodically review and update, as appropriate, the standards developed under this section. 

‘‘(d) REQUIREMENT TO PROVIDE.— 

‘‘(1) IN GENERAL.—Not later than 24 months after the date 

of enactment of the Patient Protection and Affordable Care 

Act, each entity described in paragraph (3) shall provide, prior 
H. R. 3590—16 

to any enrollment restriction, a summary of benefits and coverage explanation pursuant to the standards developed by 

the Secretary under subsection (a) to— 

‘‘(A) an applicant at the time of application; 

‘‘(B) an enrollee prior to the time of enrollment or 

reenrollment, as applicable; and 

‘‘(C) a policyholder or certificate holder at the time 

of issuance of the policy or delivery of the certificate. 

‘‘(2) COMPLIANCE.—An entity described in paragraph (3) 

is deemed to be in compliance with this section if the summary 

of benefits and coverage described in subsection (a) is provided 

in paper or electronic form. 

‘‘(3) ENTITIES IN GENERAL.—An entity described in this 

paragraph is— 

‘‘(A) a health insurance issuer (including a group health 

plan that is not a self-insured plan) offering health insurance coverage within the United States; or 

‘‘(B) in the case of a self-insured group health plan, 

the plan sponsor or designated administrator of the plan 

(as such terms are defined in section 3(16) of the Employee 

Retirement Income Security Act of 1974). 

‘‘(4) NOTICE OF MODIFICATIONS.—If a group health plan 

or health insurance issuer makes any material modification 

in any of the terms of the plan or coverage involved (as defined 

for purposes of section 102 of the Employee Retirement Income 

Security Act of 1974) that is not reflected in the most recently 

provided summary of benefits and coverage, the plan or issuer 

shall provide notice of such modification to enrollees not later 

than 60 days prior to the date on which such modification 

will become effective. 

‘‘(e) PREEMPTION.—The standards developed under subsection 

(a) shall preempt any related State standards that require a summary of benefits and coverage that provides less information to 

consumers than that required to be provided under this section, 

as determined by the Secretary. 

‘‘(f) FAILURE TO PROVIDE.—An entity described in subsection 

(d)(3) that willfully fails to provide the information required under 

this section shall be subject to a fine of not more than $1,000 

for each such failure. Such failure with respect to each enrollee 

shall constitute a separate offense for purposes of this subsection. 

‘‘(g) DEVELOPMENT OF STANDARD DEFINITIONS.— 

‘‘(1) IN GENERAL.—The Secretary shall, by regulation, provide for the development of standards for the definitions of 

terms used in health insurance coverage, including the insurance-related terms described in paragraph (2) and the medical 

terms described in paragraph (3). 

‘‘(2) INSURANCE-RELATED TERMS.—The insurance-related 

terms described in this paragraph are premium, deductible, 

co-insurance, co-payment, out-of-pocket limit, preferred provider, non-preferred provider, out-of-network co-payments, UCR 

(usual, customary and reasonable) fees, excluded services, grievance and appeals, and such other terms as the Secretary determines are important to define so that consumers may compare 

health insurance coverage and understand the terms of their 

coverage. 
H. R. 3590—17 

‘‘(3) MEDICAL TERMS.—The medical terms described in this 

paragraph are hospitalization, hospital outpatient care, emergency room care, physician services, prescription drug coverage, 

durable medical equipment, home health care, skilled nursing 

care, rehabilitation services, hospice services, emergency medical transportation, and such other terms as the Secretary 

determines are important to define so that consumers may 

compare the medical benefits offered by health insurance and 

understand the extent of those medical benefits (or exceptions 

to those benefits). 

‘‘SEC. 2716. PROHIBITION OF DISCRIMINATION BASED ON SALARY. 

‘‘(a) IN GENERAL.—The plan sponsor of a group health plan 

(other than a self-insured plan) may not establish rules relating 

to the health insurance coverage eligibility (including continued 

eligibility) of any full-time employee under the terms of the plan 

that are based on the total hourly or annual salary of the employee 

or otherwise establish eligibility rules that have the effect of 

discriminating in favor of higher wage employees. 

‘‘(b) LIMITATION.—Subsection (a) shall not be construed to prohibit a plan sponsor from establishing contribution requirements 

for enrollment in the plan or coverage that provide for the payment 

by employees with lower hourly or annual compensation of a lower 

dollar or percentage contribution than the payment required of 

similarly situated employees with a higher hourly or annual compensation. 

‘‘SEC. 2717. ENSURING THE QUALITY OF CARE. 

‘‘(a) QUALITY REPORTING.— ‘‘(1) IN GENERAL.—Not later than 2 years after the date 

of enactment of the Patient Protection and Affordable Care 

Act, the Secretary, in consultation with experts in health care 

quality and stakeholders, shall develop reporting requirements 

for use by a group health plan, and a health insurance issuer 

offering group or individual health insurance coverage, with 

respect to plan or coverage benefits and health care provider 

reimbursement structures that— 

‘‘(A) improve health outcomes through the implementation of activities such as quality reporting, effective case 

management, care coordination, chronic disease management, and medication and care compliance initiatives, 

including through the use of the medical homes model 

as defined for purposes of section 3602 of the Patient 

Protection and Affordable Care Act, for treatment or services under the plan or coverage; 

‘‘(B) implement activities to prevent hospital readmissions through a comprehensive program for hospital discharge that includes patient-centered education and counseling, comprehensive discharge planning, and post discharge reinforcement by an appropriate health care professional; 

‘‘(C) implement activities to improve patient safety and 

reduce medical errors through the appropriate use of best 

clinical practices, evidence based medicine, and health 

information technology under the plan or coverage; and 

‘‘(D) implement wellness and health promotion activities. 

‘‘(2) REPORTING REQUIREMENTS.— 
H. R. 3590—18 

‘‘(A) IN GENERAL.—A group health plan and a health 

insurance issuer offering group or individual health insurance coverage shall annually submit to the Secretary, and 

to enrollees under the plan or coverage, a report on whether 

the benefits under the plan or coverage satisfy the elements 

described in subparagraphs (A) through (D) of paragraph 

(1). 

‘‘(B) TIMING OF REPORTS.—A report under subparagraph (A) shall be made available to an enrollee under 

the plan or coverage during each open enrollment period. 

‘‘(C) AVAILABILITY OF REPORTS.—The Secretary shall 

make reports submitted under subparagraph (A) available 

to the public through an Internet website. 

‘‘(D) PENALTIES.—In developing the reporting requirements under paragraph (1), the Secretary may develop 

and impose appropriate penalties for non-compliance with 

such requirements. 

‘‘(E) EXCEPTIONS.—In developing the reporting requirements under paragraph (1), the Secretary may provide 

for exceptions to such requirements for group health plans 

and health insurance issuers that substantially meet the 

goals of this section. 

‘‘(b) WELLNESS AND PREVENTION PROGRAMS.—For purposes of 

subsection (a)(1)(D), wellness and health promotion activities may 

include personalized wellness and prevention services, which are 

coordinated, maintained or delivered by a health care provider, 

a wellness and prevention plan manager, or a health, wellness 

or prevention services organization that conducts health risk assessments or offers ongoing face-to-face, telephonic or web-based intervention efforts for each of the program’s participants, and which 

may include the following wellness and prevention efforts: 

‘‘(1) Smoking cessation. 

‘‘(2) Weight management. 

‘‘(3) Stress management. 

‘‘(4) Physical fitness. 

‘‘(5) Nutrition. 

‘‘(6) Heart disease prevention. 

‘‘(7) Healthy lifestyle support. 

‘‘(8) Diabetes prevention. 

‘‘(c) REGULATIONS.—Not later than 2 years after the date of 

enactment of the Patient Protection and Affordable Care Act, the 

Secretary shall promulgate regulations that provide criteria for 

determining whether a reimbursement structure is described in 

subsection (a). 

‘‘(d) STUDY AND REPORT.—Not later than 180 days after the 

date on which regulations are promulgated under subsection (c), 

the Government Accountability Office shall review such regulations 

and conduct a study and submit to the Committee on Health, 

Education, Labor, and Pensions of the Senate and the Committee 

on Energy and Commerce of the House of Representatives a report 

regarding the impact the activities under this section have had 

on the quality and cost of health care. 

‘‘SEC. 2718. BRINGING DOWN THE COST OF HEALTH CARE COVERAGE. 

‘‘(a) CLEAR ACCOUNTING FOR COSTS.—A health insurance issuer 

offering group or individual health insurance coverage shall, with 
H. R. 3590—19 

respect to each plan year, submit to the Secretary a report concerning the percentage of total premium revenue that such coverage 

expends— 

‘‘(1) on reimbursement for clinical services provided to 

enrollees under such coverage; 

‘‘(2) for activities that improve health care quality; and 

‘‘(3) on all other non-claims costs, including an explanation 

of the nature of such costs, and excluding State taxes and 

licensing or regulatory fees. 

The Secretary shall make reports received under this section available to the public on the Internet website of the Department of 

Health and Human Services. 

‘‘(b) ENSURING THAT CONSUMERS RECEIVE VALUE FOR THEIR

PREMIUM PAYMENTS.— 

‘‘(1) REQUIREMENT TO PROVIDE VALUE FOR PREMIUM PAYMENTS.—A health insurance issuer offering group or individual 

health insurance coverage shall, with respect to each plan 

year, provide an annual rebate to each enrollee under such 

coverage, on a pro rata basis, in an amount that is equal 

to the amount by which premium revenue expended by the 

issuer on activities described in subsection (a)(3) exceeds— 

‘‘(A) with respect to a health insurance issuer offering 

coverage in the group market, 20 percent, or such lower 

percentage as a State may by regulation determine; or 

‘‘(B) with respect to a health insurance issuer offering 

coverage in the individual market, 25 percent, or such 

lower percentage as a State may by regulation determine, 

except that such percentage shall be adjusted to the extent 

the Secretary determines that the application of such 

percentage with a State may destabilize the existing individual market in such State. 

‘‘(2) CONSIDERATION IN SETTING PERCENTAGES.—In determining the percentages under paragraph (1), a State shall 

seek to ensure adequate participation by health insurance 

issuers, competition in the health insurance market in the 

State, and value for consumers so that premiums are used 

for clinical services and quality improvements. 

‘‘(3) TERMINATION.—The provisions of this subsection shall 

have no force or effect after December 31, 2013. 

‘‘(c) STANDARD HOSPITAL CHARGES.—Each hospital operating 

within the United States shall for each year establish (and update) 

and make public (in accordance with guidelines developed by the 

Secretary) a list of the hospital’s standard charges for items and 

services provided by the hospital, including for diagnosis-related 

groups established under section 1886(d)(4) of the Social Security 

Act. 

‘‘(d) DEFINITIONS.—The Secretary, in consultation with the 

National Association of Insurance Commissions, shall establish uniform definitions for the activities reported under subsection (a). 

‘‘SEC. 2719. APPEALS PROCESS. 

‘‘A group health plan and a health insurance issuer offering 

group or individual health insurance coverage shall implement an 

effective appeals process for appeals of coverage determinations 

and claims, under which the plan or issuer shall, at a minimum— 

‘‘(1) have in effect an internal claims appeal process; 
H. R. 3590—20 

‘‘(2) provide notice to enrollees, in a culturally and linguistically appropriate manner, of available internal and external 

appeals processes, and the availability of any applicable office 

of health insurance consumer assistance or ombudsman established under section 2793 to assist such enrollees with the 

appeals processes; 

‘‘(3) allow an enrollee to review their file, to present evidence and testimony as part of the appeals process, and to 

receive continued coverage pending the outcome of the appeals 

process; and 

‘‘(4) provide an external review process for such plans and 

issuers that, at a minimum, includes the consumer protections 

set forth in the Uniform External Review Model Act promulgated by the National Association of Insurance Commissioners 

and is binding on such plans.’’. 

SEC. 1002. HEALTH INSURANCE CONSUMER INFORMATION. 

Part C of title XXVII of the Public Health Service Act (42 

U.S.C. 300gg–91 et seq.) is amended by adding at the end the 

following: 

‘‘SEC. 2793. HEALTH INSURANCE CONSUMER INFORMATION. 

‘‘(a) IN GENERAL.—The Secretary shall award grants to States 

to enable such States (or the Exchanges operating in such States) 

to establish, expand, or provide support for— 

‘‘(1) offices of health insurance consumer assistance; or 

‘‘(2) health insurance ombudsman programs. 

‘‘(b) ELIGIBILITY.— 

‘‘(1) IN GENERAL.—To be eligible to receive a grant, a State 

shall designate an independent office of health insurance consumer assistance, or an ombudsman, that, directly or in 

coordination with State health insurance regulators and consumer assistance organizations, receives and responds to 

inquiries and complaints concerning health insurance coverage 

with respect to Federal health insurance requirements and 

under State law. 

‘‘(2) CRITERIA.—A State that receives a grant under this 

section shall comply with criteria established by the Secretary 

for carrying out activities under such grant. 

‘‘(c) DUTIES.—The office of health insurance consumer assistance or health insurance ombudsman shall— 

‘‘(1) assist with the filing of complaints and appeals, 

including filing appeals with the internal appeal or grievance 

process of the group health plan or health insurance issuer 

involved and providing information about the external appeal 

process; 

‘‘(2) collect, track, and quantify problems and inquiries 

encountered by consumers; 

‘‘(3) educate consumers on their rights and responsibilities 

with respect to group health plans and health insurance coverage; 

‘‘(4) assist consumers with enrollment in a group health 

plan or health insurance coverage by providing information, 

referral, and assistance; and 

‘‘(5) resolve problems with obtaining premium tax credits 

under section 36B of the Internal Revenue Code of 1986. 
H. R. 3590—21 

‘‘(d) DATA COLLECTION.—As a condition of receiving a grant 

under subsection (a), an office of health insurance consumer assistance or ombudsman program shall be required to collect and report 

data to the Secretary on the types of problems and inquiries encountered by consumers. The Secretary shall utilize such data to identify 

areas where more enforcement action is necessary and shall share 

such information with State insurance regulators, the Secretary 

of Labor, and the Secretary of the Treasury for use in the enforcement activities of such agencies. 

‘‘(e) FUNDING.— ‘‘(1) INITIAL FUNDING.—There is hereby appropriated to 

the Secretary, out of any funds in the Treasury not otherwise 

appropriated, $30,000,000 for the first fiscal year for which 

this section applies to carry out this section. Such amount 

shall remain available without fiscal year limitation. 

‘‘(2) AUTHORIZATION FOR SUBSEQUENT YEARS.—There is 

authorized to be appropriated to the Secretary for each fiscal 

year following the fiscal year described in paragraph (1), such 

sums as may be necessary to carry out this section.’’. 

SEC. 1003. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOLLARS. 

Part C of title XXVII of the Public Health Service Act (42 

U.S.C. 300gg–91 et seq.), as amended by section 1002, is further 

amended by adding at the end the following: 

‘‘SEC. 2794. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOLLARS. 

‘‘(a) INITIAL PREMIUM REVIEW PROCESS.— ‘‘(1) IN GENERAL.—The Secretary, in conjunction with 

States, shall establish a process for the annual review, beginning with the 2010 plan year and subject to subsection (b)(2)(A), 

of unreasonable increases in premiums for health insurance 

coverage. 

‘‘(2) JUSTIFICATION AND DISCLOSURE.—The process established under paragraph (1) shall require health insurance 

issuers to submit to the Secretary and the relevant State a 

justification for an unreasonable premium increase prior to 

the implementation of the increase. Such issuers shall prominently post such information on their Internet websites. The 

Secretary shall ensure the public disclosure of information on 

such increases and justifications for all health insurance 

issuers. 

‘‘(b) CONTINUING PREMIUM REVIEW PROCESS.— ‘‘(1) INFORMING SECRETARY OF PREMIUM INCREASE PAT- TERNS.—As a condition of receiving a grant under subsection 

(c)(1), a State, through its Commissioner of Insurance, shall— 

‘‘(A) provide the Secretary with information about 

trends in premium increases in health insurance coverage 

in premium rating areas in the State; and 

‘‘(B) make recommendations, as appropriate, to the 

State Exchange about whether particular health insurance 

issuers should be excluded from participation in the 

Exchange based on a pattern or practice of excessive or 

unjustified premium increases. 

‘‘(2) MONITORING BY SECRETARY OF PREMIUM INCREASES.— ‘‘(A) IN GENERAL.—Beginning with plan years beginning in 2014, the Secretary, in conjunction with the States 
H. R. 3590—22 

and consistent with the provisions of subsection (a)(2), shall 

monitor premium increases of health insurance coverage 

offered through an Exchange and outside of an Exchange. 

‘‘(B) CONSIDERATION IN OPENING EXCHANGE.—In determining under section 1312(f)(2)(B) of the Patient Protection 

and Affordable Care Act whether to offer qualified health 

plans in the large group market through an Exchange, 

the State shall take into account any excess of premium 

growth outside of the Exchange as compared to the rate 

of such growth inside the Exchange. 

‘‘(c) GRANTS IN SUPPORT OF PROCESS.— 

‘‘(1) PREMIUM REVIEW GRANTS DURING 2010 THROUGH 2014.— 

The Secretary shall carry out a program to award grants to 

States during the 5-year period beginning with fiscal year 2010 

to assist such States in carrying out subsection (a), including— 

‘‘(A) in reviewing and, if appropriate under State law, 

approving premium increases for health insurance coverage; and 

‘‘(B) in providing information and recommendations 

to the Secretary under subsection (b)(1). 

‘‘(2) FUNDING.— 

‘‘(A) IN GENERAL.—Out of all funds in the Treasury 

not otherwise appropriated, there are appropriated to the 

Secretary $250,000,000, to be available for expenditure for 

grants under paragraph (1) and subparagraph (B). 

‘‘(B) FURTHER AVAILABILITY FOR INSURANCE REFORM

AND CONSUMER PROTECTION.—If the amounts appropriated 

under subparagraph (A) are not fully obligated under 

grants under paragraph (1) by the end of fiscal year 2014, 

any remaining funds shall remain available to the Secretary for grants to States for planning and implementing 

the insurance reforms and consumer protections under part 

A. 

‘‘(C) ALLOCATION.—The Secretary shall establish a formula for determining the amount of any grant to a State 

under this subsection. Under such formula— 

‘‘(i) the Secretary shall consider the number of 

plans of health insurance coverage offered in each State 

and the population of the State; and 

‘‘(ii) no State qualifying for a grant under paragraph (1) shall receive less than $1,000,000, or more 

than $5,000,000 for a grant year.’’. 

SEC. 1004. EFFECTIVE DATES. 

(a) IN GENERAL.—Except as provided for in subsection (b), 

this subtitle (and the amendments made by this subtitle) shall 

become effective for plan years beginning on or after the date 

that is 6 months after the date of enactment of this Act, except 

that the amendments made by sections 1002 and 1003 shall become 

effective for fiscal years beginning with fiscal year 2010. 

(b) SPECIAL RULE.—The amendments made by sections 1002 

and 1003 shall take effect on the date of enactment of this Act. 
H. R. 3590—23 

Subtitle B—Immediate Actions to Preserve 

and Expand Coverage 

SEC. 1101. IMMEDIATE ACCESS TO INSURANCE FOR UNINSURED 

INDIVIDUALS WITH A PREEXISTING CONDITION. 

(a) IN GENERAL.—Not later than 90 days after the date of 

enactment of this Act, the Secretary shall establish a temporary 

high risk health insurance pool program to provide health insurance 

coverage for eligible individuals during the period beginning on 

the date on which such program is established and ending on 

January 1, 2014. 

(b) ADMINISTRATION.— (1) IN GENERAL.—The Secretary may carry out the program 

under this section directly or through contracts to eligible entities. 

(2) ELIGIBLE ENTITIES.—To be eligible for a contract under 

paragraph (1), an entity shall— 

(A) be a State or nonprofit private entity; 

(B) submit to the Secretary an application at such 

time, in such manner, and containing such information 

as the Secretary may require; and 

(C) agree to utilize contract funding to establish and 

administer a qualified high risk pool for eligible individuals. 

(3) MAINTENANCE OF EFFORT.—To be eligible to enter into 

a contract with the Secretary under this subsection, a State 

shall agree not to reduce the annual amount the State expended 

for the operation of one or more State high risk pools during 

the year preceding the year in which such contract is entered 

into. 

(c) QUALIFIED HIGH RISK POOL.— (1) IN GENERAL.—Amounts made available under this section shall be used to establish a qualified high risk pool that 

meets the requirements of paragraph (2). 

(2) REQUIREMENTS.—A qualified high risk pool meets the 

requirements of this paragraph if such pool— 

(A) provides to all eligible individuals health insurance 

coverage that does not impose any preexisting condition 

exclusion with respect to such coverage; 

(B) provides health insurance coverage— 

(i) in which the issuer’s share of the total allowed 

costs of benefits provided under such coverage is not 

less than 65 percent of such costs; and 

(ii) that has an out of pocket limit not greater 

than the applicable amount described in section 

223(c)(2) of the Internal Revenue Code of 1986 for 

the year involved, except that the Secretary may 

modify such limit if necessary to ensure the pool meets 

the actuarial value limit under clause (i); 

(C) ensures that with respect to the premium rate 

charged for health insurance coverage offered to eligible 

individuals through the high risk pool, such rate shall— 

(i) except as provided in clause (ii), vary only as 

provided for under section 2701 of the Public Health 

Service Act (as amended by this Act and notwithstanding the date on which such amendments take 

effect); 
H. R. 3590—24 

(ii) vary on the basis of age by a factor of not 

greater than 4 to 1; and 

(iii) be established at a standard rate for a 

standard population; and 

(D) meets any other requirements determined appropriate by the Secretary. 

(d) ELIGIBLE INDIVIDUAL.—An individual shall be deemed to 

be an eligible individual for purposes of this section if such individual— 

(1) is a citizen or national of the United States or is 

lawfully present in the United States (as determined in accordance with section 1411); 

(2) has not been covered under creditable coverage (as 

defined in section 2701(c)(1) of the Public Health Service Act 

as in effect on the date of enactment of this Act) during the 

6-month period prior to the date on which such individual 

is applying for coverage through the high risk pool; and 

(3) has a pre-existing condition, as determined in a manner 

consistent with guidance issued by the Secretary. 

(e) PROTECTION AGAINST DUMPING RISK BY INSURERS.— 

(1) IN GENERAL.—The Secretary shall establish criteria for 

determining whether health insurance issuers and employmentbased health plans have discouraged an individual from 

remaining enrolled in prior coverage based on that individual’s 

health status. 

(2) SANCTIONS.—An issuer or employment-based health 

plan shall be responsible for reimbursing the program under 

this section for the medical expenses incurred by the program 

for an individual who, based on criteria established by the 

Secretary, the Secretary finds was encouraged by the issuer 

to disenroll from health benefits coverage prior to enrolling 

in coverage through the program. The criteria shall include 

at least the following circumstances: 

(A) In the case of prior coverage obtained through 

an employer, the provision by the employer, group health 

plan, or the issuer of money or other financial consideration 

for disenrolling from the coverage. 

(B) In the case of prior coverage obtained directly from 

an issuer or under an employment-based health plan— 

(i) the provision by the issuer or plan of money 

or other financial consideration for disenrolling from 

the coverage; or 

(ii) in the case of an individual whose premium 

for the prior coverage exceeded the premium required 

by the program (adjusted based on the age factors 

applied to the prior coverage)— 

(I) the prior coverage is a policy that is no 

longer being actively marketed (as defined by the 

Secretary) by the issuer; or 

(II) the prior coverage is a policy for which 

duration of coverage form issue or health status 

are factors that can be considered in determining 

premiums at renewal. 

(3) CONSTRUCTION.—Nothing in this subsection shall be 

construed as constituting exclusive remedies for violations of 

criteria established under paragraph (1) or as preventing States 
H. R. 3590—25 

from applying or enforcing such paragraph or other provisions 

under law with respect to health insurance issuers. 

(f) OVERSIGHT.—The Secretary shall establish— 

(1) an appeals process to enable individuals to appeal a 

determination under this section; and 

(2) procedures to protect against waste, fraud, and abuse. 

(g) FUNDING; TERMINATION OF AUTHORITY.— 

(1) IN GENERAL.—There is appropriated to the Secretary, 

out of any moneys in the Treasury not otherwise appropriated, 

$5,000,000,000 to pay claims against (and the administrative 

costs of) the high risk pool under this section that are in 

excess of the amount of premiums collected from eligible 

individuals enrolled in the high risk pool. Such funds shall 

be available without fiscal year limitation. 

(2) INSUFFICIENT FUNDS.—If the Secretary estimates for 

any fiscal year that the aggregate amounts available for the 

payment of the expenses of the high risk pool will be less 

than the actual amount of such expenses, the Secretary shall 

make such adjustments as are necessary to eliminate such 

deficit. 

(3) TERMINATION OF AUTHORITY.— 

(A) IN GENERAL.—Except as provided in subparagraph 

(B), coverage of eligible individuals under a high risk pool 

in a State shall terminate on January 1, 2014. 

(B) TRANSITION TO EXCHANGE.—The Secretary shall 

develop procedures to provide for the transition of eligible 

individuals enrolled in health insurance coverage offered 

through a high risk pool established under this section 

into qualified health plans offered through an Exchange. 

Such procedures shall ensure that there is no lapse in 

coverage with respect to the individual and may extend 

coverage after the termination of the risk pool involved, 

if the Secretary determines necessary to avoid such a lapse. 

(4) LIMITATIONS.—The Secretary has the authority to stop 

taking applications for participation in the program under this 

section to comply with the funding limitation provided for in 

paragraph (1). 

(5) RELATION TO STATE LAWS.—The standards established 

under this section shall supersede any State law or regulation 

(other than State licensing laws or State laws relating to plan 

solvency) with respect to qualified high risk pools which are 

established in accordance with this section. 

SEC. 1102. REINSURANCE FOR EARLY RETIREES. 

(a) ADMINISTRATION.— 

(1) IN GENERAL.—Not later than 90 days after the date 

of enactment of this Act, the Secretary shall establish a temporary reinsurance program to provide reimbursement to 

participating employment-based plans for a portion of the cost 

of providing health insurance coverage to early retirees (and 

to the eligible spouses, surviving spouses, and dependents of 

such retirees) during the period beginning on the date on which 

such program is established and ending on January 1, 2014. 

(2) REFERENCE.—In this section: 

(A) HEALTH BENEFITS.—The term ‘‘health benefits’’ 

means medical, surgical, hospital, prescription drug, and 

such other benefits as shall be determined by the Secretary, 
H. R. 3590—26 

whether self-funded, or delivered through the purchase 

of insurance or otherwise. 

(B) EMPLOYMENT-BASED PLAN.—The term ‘‘employment-based plan’’ means a group health benefits plan 

that— 

(i) is— 

(I) maintained by one or more current or 

former employers (including without limitation any 

State or local government or political subdivision 

thereof), employee organization, a voluntary 

employees’ beneficiary association, or a committee 

or board of individuals appointed to administer 

such plan; or 

(II) a multiemployer plan (as defined in section 

3(37) of the Employee Retirement Income Security 

Act of 1974); and 

(ii) provides health benefits to early retirees. 

(C) EARLY RETIREES.—The term ‘‘early retirees’’ means 

individuals who are age 55 and older but are not eligible 

for coverage under title XVIII of the Social Security Act, 

and who are not active employees of an employer 

maintaining, or currently contributing to, the employmentbased plan or of any employer that has made substantial 

contributions to fund such plan. 

(b) PARTICIPATION.— 

(1) EMPLOYMENT-BASED PLAN ELIGIBILITY.—A participating 

employment-based plan is an employment-based plan that— 

(A) meets the requirements of paragraph (2) with 

respect to health benefits provided under the plan; and 

(B) submits to the Secretary an application for participation in the program, at such time, in such manner, 

and containing such information as the Secretary shall 

require. 

(2) EMPLOYMENT-BASED HEALTH BENEFITS.—An employment-based plan meets the requirements of this paragraph 

if the plan— 

(A) implements programs and procedures to generate 

cost-savings with respect to participants with chronic and 

high-cost conditions; 

(B) provides documentation of the actual cost of medical 

claims involved; and 

(C) is certified by the Secretary. 

(c) PAYMENTS.— 

(1) SUBMISSION OF CLAIMS.— 

(A) IN GENERAL.—A participating employment-based 

plan shall submit claims for reimbursement to the Secretary which shall contain documentation of the actual 

costs of the items and services for which each claim is 

being submitted. 

(B) BASIS FOR CLAIMS.—Claims submitted under 

subparagraph (A) shall be based on the actual amount 

expended by the participating employment-based plan 

involved within the plan year for the health benefits provided to an early retiree or the spouse, surviving spouse, 

or dependent of such retiree. In determining the amount 

of a claim for purposes of this subsection, the participating 
H. R. 3590—27 

employment-based plan shall take into account any negotiated price concessions (such as discounts, direct or 

indirect subsidies, rebates, and direct or indirect remunerations) obtained by such plan with respect to such health 

benefit. For purposes of determining the amount of any 

such claim, the costs paid by the early retiree or the 

retiree’s spouse, surviving spouse, or dependent in the form 

of deductibles, co-payments, or co-insurance shall be 

included in the amounts paid by the participating employment-based plan. 

(2) PROGRAM PAYMENTS.—If the Secretary determines that 

a participating employment-based plan has submitted a valid 

claim under paragraph (1), the Secretary shall reimburse such 

plan for 80 percent of that portion of the costs attributable 

to such claim that exceed $15,000, subject to the limits contained in paragraph (3). 

(3) LIMIT.—To be eligible for reimbursement under the 

program, a claim submitted by a participating employmentbased plan shall not be less than $15,000 nor greater than 

$90,000. Such amounts shall be adjusted each fiscal year based 

on the percentage increase in the Medical Care Component 

of the Consumer Price Index for all urban consumers (rounded 

to the nearest multiple of $1,000) for the year involved. 

(4) USE OF PAYMENTS.—Amounts paid to a participating 

employment-based plan under this subsection shall be used 

to lower costs for the plan. Such payments may be used to 

reduce premium costs for an entity described in subsection 

(a)(2)(B)(i) or to reduce premium contributions, co-payments, 

deductibles, co-insurance, or other out-of-pocket costs for plan 

participants. Such payments shall not be used as general revenues for an entity described in subsection (a)(2)(B)(i). The Secretary shall develop a mechanism to monitor the appropriate 

use of such payments by such entities. 

(5) PAYMENTS NOT TREATED AS INCOME.—Payments 

received under this subsection shall not be included in determining the gross income of an entity described in subsection 

(a)(2)(B)(i) that is maintaining or currently contributing to a 

participating employment-based plan. 

(6) APPEALS.—The Secretary shall establish— 

(A) an appeals process to permit participating employment-based plans to appeal a determination of the Secretary with respect to claims submitted under this section; 

and 

(B) procedures to protect against fraud, waste, and 

abuse under the program. 

(d) AUDITS.—The Secretary shall conduct annual audits of 

claims data submitted by participating employment-based plans 

under this section to ensure that such plans are in compliance 

with the requirements of this section. 

(e) FUNDING.—There is appropriated to the Secretary, out of 

any moneys in the Treasury not otherwise appropriated, 

$5,000,000,000 to carry out the program under this section. Such 

funds shall be available without fiscal year limitation. 

(f) LIMITATION.—The Secretary has the authority to stop taking 

applications for participation in the program based on the availability of funding under subsection (e). 
H. R. 3590—28 

SEC. 1103. IMMEDIATE INFORMATION THAT ALLOWS CONSUMERS TO 

IDENTIFY AFFORDABLE COVERAGE OPTIONS. 

(a) INTERNET PORTAL TO AFFORDABLE COVERAGE OPTIONS.— 

(1) IMMEDIATE ESTABLISHMENT.—Not later than July 1, 

2010, the Secretary, in consultation with the States, shall establish a mechanism, including an Internet website, through which 

a resident of any State may identify affordable health insurance 

coverage options in that State. 

(2) CONNECTING TO AFFORDABLE COVERAGE.—An Internet 

website established under paragraph (1) shall, to the extent 

practicable, provide ways for residents of any State to receive 

information on at least the following coverage options: 

(A) Health insurance coverage offered by health insurance issuers, other than coverage that provides reimbursement only for the treatment or mitigation of— 

(i) a single disease or condition; or 

(ii) an unreasonably limited set of diseases or 

conditions (as determined by the Secretary); 

(B) Medicaid coverage under title XIX of the Social 

Security Act. 

(C) Coverage under title XXI of the Social Security 

Act. 

(D) A State health benefits high risk pool, to the extent 

that such high risk pool is offered in such State; and 

(E) Coverage under a high risk pool under section 

1101. 

(b) ENHANCING COMPARATIVE PURCHASING OPTIONS.— 

(1) IN GENERAL.—Not later than 60 days after the date 

of enactment of this Act, the Secretary shall develop a standardized format to be used for the presentation of information 

relating to the coverage options described in subsection (a)(2). 

Such format shall, at a minimum, require the inclusion of 

information on the percentage of total premium revenue 

expended on nonclinical costs (as reported under section 2718(a) 

of the Public Health Service Act), eligibility, availability, premium rates, and cost sharing with respect to such coverage 

options and be consistent with the standards adopted for the 

uniform explanation of coverage as provided for in section 2715 

of the Public Health Service Act. 

(2) USE OF FORMAT.—The Secretary shall utilize the format 

developed under paragraph (1) in compiling information concerning coverage options on the Internet website established 

under subsection (a). 

(c) AUTHORITY TO CONTRACT.—The Secretary may carry out 

this section through contracts entered into with qualified entities. 

SEC. 1104. ADMINISTRATIVE SIMPLIFICATION. 

(a) PURPOSE OF ADMINISTRATIVE SIMPLIFICATION.—Section 261 

of the Health Insurance Portability and Accountability Act of 1996 

(42 U.S.C. 1320d note) is amended— 

(1) by inserting ‘‘uniform’’ before ‘‘standards’’; and 

(2) by inserting ‘‘and to reduce the clerical burden on 

patients, health care providers, and health plans’’ before the 

period at the end. 

(b) OPERATING RULES FOR HEALTH INFORMATION TRANSACTIONS.— 
H. R. 3590—29 

(1) DEFINITION OF OPERATING RULES.—Section 1171 of the 

Social Security Act (42 U.S.C. 1320d) is amended by adding 

at the end the following: 

‘‘(9) OPERATING RULES.—The term ‘operating rules’ means 

the necessary business rules and guidelines for the electronic 

exchange of information that are not defined by a standard 

or its implementation specifications as adopted for purposes 

of this part.’’. 

(2) TRANSACTION STANDARDS; OPERATING RULES AND

COMPLIANCE.—Section 1173 of the Social Security Act (42 U.S.C. 

1320d–2) is amended— 

(A) in subsection (a)(2), by adding at the end the following new subparagraph: 

‘‘(J) Electronic funds transfers.’’; 

(B) in subsection (a), by adding at the end the following 

new paragraph: 

‘‘(4) REQUIREMENTS FOR FINANCIAL AND ADMINISTRATIVE

TRANSACTIONS.— 

‘‘(A) IN GENERAL.—The standards and associated operating rules adopted by the Secretary shall— 

‘‘(i) to the extent feasible and appropriate, enable 

determination of an individual’s eligibility and financial responsibility for specific services prior to or at 

the point of care; 

‘‘(ii) be comprehensive, requiring minimal augmentation by paper or other communications; 

‘‘(iii) provide for timely acknowledgment, response, 

and status reporting that supports a transparent 

claims and denial management process (including adjudication and appeals); and 

‘‘(iv) describe all data elements (including reason 

and remark codes) in unambiguous terms, require that 

such data elements be required or conditioned upon 

set values in other fields, and prohibit additional conditions (except where necessary to implement State or 

Federal law, or to protect against fraud and abuse). 

‘‘(B) REDUCTION OF CLERICAL BURDEN.—In adopting 

standards and operating rules for the transactions referred 

to under paragraph (1), the Secretary shall seek to reduce 

the number and complexity of forms (including paper and 

electronic forms) and data entry required by patients and 

providers.’’; and 

(C) by adding at the end the following new subsections: 

‘‘(g) OPERATING RULES.— 

‘‘(1) IN GENERAL.—The Secretary shall adopt a single set 

of operating rules for each transaction referred to under subsection (a)(1) with the goal of creating as much uniformity 

in the implementation of the electronic standards as possible. 

Such operating rules shall be consensus-based and reflect the 

necessary business rules affecting health plans and health care 

providers and the manner in which they operate pursuant 

to standards issued under Health Insurance Portability and 

Accountability Act of 1996. 

‘‘(2) OPERATING RULES DEVELOPMENT.—In adopting operating rules under this subsection, the Secretary shall consider 

recommendations for operating rules developed by a qualified 

nonprofit entity that meets the following requirements: 
H. R. 3590—30 

‘‘(A) The entity focuses its mission on administrative 

simplification. 

‘‘(B) The entity demonstrates a multi-stakeholder and 

consensus-based process for development of operating rules, 

including representation by or participation from health 

plans, health care providers, vendors, relevant Federal 

agencies, and other standard development organizations. 

‘‘(C) The entity has a public set of guiding principles 

that ensure the operating rules and process are open and 

transparent, and supports nondiscrimination and conflict 

of interest policies that demonstrate a commitment to open, 

fair, and nondiscriminatory practices. 

‘‘(D) The entity builds on the transaction standards 

issued under Health Insurance Portability and Accountability Act of 1996. 

‘‘(E) The entity allows for public review and updates 

of the operating rules. 

‘‘(3) REVIEW AND RECOMMENDATIONS.—The National Committee on Vital and Health Statistics shall— 

‘‘(A) advise the Secretary as to whether a nonprofit 

entity meets the requirements under paragraph (2); 

‘‘(B) review the operating rules developed and recommended by such nonprofit entity; 

‘‘(C) determine whether such operating rules represent 

a consensus view of the health care stakeholders and are 

consistent with and do not conflict with other existing 

standards; 

‘‘(D) evaluate whether such operating rules are consistent with electronic standards adopted for health 

information technology; and 

‘‘(E) submit to the Secretary a recommendation as to 

whether the Secretary should adopt such operating rules. 

‘‘(4) IMPLEMENTATION.— 

‘‘(A) IN GENERAL.—The Secretary shall adopt operating 

rules under this subsection, by regulation in accordance 

with subparagraph (C), following consideration of the operating rules developed by the non-profit entity described 

in paragraph (2) and the recommendation submitted by 

the National Committee on Vital and Health Statistics 

under paragraph (3)(E) and having ensured consultation 

with providers. 

‘‘(B) ADOPTION REQUIREMENTS; EFFECTIVE DATES.— 

‘‘(i) ELIGIBILITY FOR A HEALTH PLAN AND HEALTH

CLAIM STATUS.—The set of operating rules for eligibility 

for a health plan and health claim status transactions 

shall be adopted not later than July 1, 2011, in a 

manner ensuring that such operating rules are effective 

not later than January 1, 2013, and may allow for 

the use of a machine readable identification card. 

‘‘(ii) ELECTRONIC FUNDS TRANSFERS AND HEALTH

CARE PAYMENT AND REMITTANCE ADVICE.—The set of 

operating rules for electronic funds transfers and 

health care payment and remittance advice transactions shall— 

‘‘(I) allow for automated reconciliation of the 

electronic payment with the remittance advice; and 
H. R. 3590—31 

‘‘(II) be adopted not later than July 1, 2012, 

in a manner ensuring that such operating rules 

are effective not later than January 1, 2014. 

‘‘(iii) HEALTH CLAIMS OR EQUIVALENT ENCOUNTER

INFORMATION, ENROLLMENT AND DISENROLLMENT IN A

HEALTH PLAN, HEALTH PLAN PREMIUM PAYMENTS, 

REFERRAL CERTIFICATION AND AUTHORIZATION.—The set 

of operating rules for health claims or equivalent 

encounter information, enrollment and disenrollment 

in a health plan, health plan premium payments, and 

referral certification and authorization transactions 

shall be adopted not later than July 1, 2014, in a 

manner ensuring that such operating rules are effective 

not later than January 1, 2016. 

‘‘(C) EXPEDITED RULEMAKING.—The Secretary shall 

promulgate an interim final rule applying any standard 

or operating rule recommended by the National Committee 

on Vital and Health Statistics pursuant to paragraph (3). 

The Secretary shall accept and consider public comments 

on any interim final rule published under this subparagraph for 60 days after the date of such publication. 

‘‘(h) COMPLIANCE.— 

‘‘(1) HEALTH PLAN CERTIFICATION.— 

‘‘(A) ELIGIBILITY FOR A HEALTH PLAN, HEALTH CLAIM

STATUS, ELECTRONIC FUNDS TRANSFERS, HEALTH CARE PAYMENT AND REMITTANCE ADVICE.—Not later than December 

31, 2013, a health plan shall file a statement with the 

Secretary, in such form as the Secretary may require, 

certifying that the data and information systems for such 

plan are in compliance with any applicable standards (as 

described under paragraph (7) of section 1171) and associated operating rules (as described under paragraph (9) 

of such section) for electronic funds transfers, eligibility 

for a health plan, health claim status, and health care 

payment and remittance advice, respectively. 

‘‘(B) HEALTH CLAIMS OR EQUIVALENT ENCOUNTER

INFORMATION, ENROLLMENT AND DISENROLLMENT IN A

HEALTH PLAN, HEALTH PLAN PREMIUM PAYMENTS, HEALTH

CLAIMS ATTACHMENTS, REFERRAL CERTIFICATION AND

AUTHORIZATION.—Not later than December 31, 2015, a 

health plan shall file a statement with the Secretary, in 

such form as the Secretary may require, certifying that 

the data and information systems for such plan are in 

compliance with any applicable standards and associated 

operating rules for health claims or equivalent encounter 

information, enrollment and disenrollment in a health plan, 

health plan premium payments, health claims attachments, 

and referral certification and authorization, respectively. 

A health plan shall provide the same level of documentation 

to certify compliance with such transactions as is required 

to certify compliance with the transactions specified in 

subparagraph (A). 

‘‘(2) DOCUMENTATION OF COMPLIANCE.—A health plan shall 

provide the Secretary, in such form as the Secretary may 

require, with adequate documentation of compliance with the 

standards and operating rules described under paragraph (1). 

A health plan shall not be considered to have provided adequate 
H. R. 3590—32 

documentation and shall not be certified as being in compliance 

with such standards, unless the health plan— 

‘‘(A) demonstrates to the Secretary that the plan conducts the electronic transactions specified in paragraph 

(1) in a manner that fully complies with the regulations 

of the Secretary; and 

‘‘(B) provides documentation showing that the plan 

has completed end-to-end testing for such transactions with 

their partners, such as hospitals and physicians. 

‘‘(3) SERVICE CONTRACTS.—A health plan shall be required 

to ensure that any entities that provide services pursuant to 

a contract with such health plan shall comply with any 

applicable certification and compliance requirements (and provide the Secretary with adequate documentation of such compliance) under this subsection. 

‘‘(4) CERTIFICATION BY OUTSIDE ENTITY.—The Secretary 

may designate independent, outside entities to certify that a 

health plan has complied with the requirements under this 

subsection, provided that the certification standards employed 

by such entities are in accordance with any standards or operating rules issued by the Secretary. 

‘‘(5) COMPLIANCE WITH REVISED STANDARDS AND OPERATING

RULES.— 

‘‘(A) IN GENERAL.—A health plan (including entities 

described under paragraph (3)) shall file a statement with 

the Secretary, in such form as the Secretary may require, 

certifying that the data and information systems for such 

plan are in compliance with any applicable revised standards and associated operating rules under this subsection 

for any interim final rule promulgated by the Secretary 

under subsection (i) that— 

‘‘(i) amends any standard or operating rule 

described under paragraph (1) of this subsection; or 

‘‘(ii) establishes a standard (as described under 

subsection (a)(1)(B)) or associated operating rules (as 

described under subsection (i)(5)) for any other financial and administrative transactions. 

‘‘(B) DATE OF COMPLIANCE.—A health plan shall comply 

with such requirements not later than the effective date 

of the applicable standard or operating rule. 

‘‘(6) AUDITS OF HEALTH PLANS.—The Secretary shall conduct 

periodic audits to ensure that health plans (including entities 

described under paragraph (3)) are in compliance with any 

standards and operating rules that are described under paragraph (1) or subsection (i)(5). 

‘‘(i) REVIEW AND AMENDMENT OF STANDARDS AND OPERATING

RULES.— 

‘‘(1) ESTABLISHMENT.—Not later than January 1, 2014, the 

Secretary shall establish a review committee (as described 

under paragraph (4)). 

‘‘(2) EVALUATIONS AND REPORTS.— 

‘‘(A) HEARINGS.—Not later than April 1, 2014, and 

not less than biennially thereafter, the Secretary, acting 

through the review committee, shall conduct hearings to 

evaluate and review the adopted standards and operating 

rules established under this section. 
H. R. 3590—33 

‘‘(B) REPORT.—Not later than July 1, 2014, and not 

less than biennially thereafter, the review committee shall 

provide recommendations for updating and improving such 

standards and operating rules. The review committee shall 

recommend a single set of operating rules per transaction 

standard and maintain the goal of creating as much uniformity as possible in the implementation of the electronic 

standards. 

‘‘(3) INTERIM FINAL RULEMAKING.— 

‘‘(A) IN GENERAL.—Any recommendations to amend 

adopted standards and operating rules that have been 

approved by the review committee and reported to the 

Secretary under paragraph (2)(B) shall be adopted by the 

Secretary through promulgation of an interim final rule 

not later than 90 days after receipt of the committee’s 

report. 

‘‘(B) PUBLIC COMMENT.— 

‘‘(i) PUBLIC COMMENT PERIOD.—The Secretary shall 

accept and consider public comments on any interim 

final rule published under this paragraph for 60 days 

after the date of such publication. 

‘‘(ii) EFFECTIVE DATE.—The effective date of any 

amendment to existing standards or operating rules 

that is adopted through an interim final rule published 

under this paragraph shall be 25 months following 

the close of such public comment period. 

‘‘(4) REVIEW COMMITTEE.— ‘‘(A) DEFINITION.—For the purposes of this subsection, 

the term ‘review committee’ means a committee chartered 

by or within the Department of Health and Human services 

that has been designated by the Secretary to carry out 

this subsection, including— 

‘‘(i) the National Committee on Vital and Health 

Statistics; or 

‘‘(ii) any appropriate committee as determined by 

the Secretary. 

‘‘(B) COORDINATION OF HIT STANDARDS.—In developing 

recommendations under this subsection, the review committee shall ensure coordination, as appropriate, with the 

standards that support the certified electronic health record 

technology approved by the Office of the National Coordinator for Health Information Technology. 

‘‘(5) OPERATING RULES FOR OTHER STANDARDS ADOPTED BY

THE SECRETARY.—The Secretary shall adopt a single set of 

operating rules (pursuant to the process described under subsection (g)) for any transaction for which a standard had been 

adopted pursuant to subsection (a)(1)(B). 

‘‘(j) PENALTIES.— ‘‘(1) PENALTY FEE.— ‘‘(A) IN GENERAL.—Not later than April 1, 2014, and 

annually thereafter, the Secretary shall assess a penalty 

fee (as determined under subparagraph (B)) against a 

health plan that has failed to meet the requirements under 

subsection (h) with respect to certification and documentation of compliance with— 

‘‘(i) the standards and associated operating rules 

described under paragraph (1) of such subsection; and 
H. R. 3590—34 

‘‘(ii) a standard (as described under subsection 

(a)(1)(B)) and associated operating rules (as described 

under subsection (i)(5)) for any other financial and 

administrative transactions. 

‘‘(B) FEE AMOUNT.—Subject to subparagraphs (C), (D), 

and (E), the Secretary shall assess a penalty fee against 

a health plan in the amount of $1 per covered life until 

certification is complete. The penalty shall be assessed 

per person covered by the plan for which its data systems 

for major medical policies are not in compliance and shall 

be imposed against the health plan for each day that the 

plan is not in compliance with the requirements under 

subsection (h). 

‘‘(C) ADDITIONAL PENALTY FOR MISREPRESENTATION.— 

A health plan that knowingly provides inaccurate or incomplete information in a statement of certification or documentation of compliance under subsection (h) shall be subject to a penalty fee that is double the amount that would 

otherwise be imposed under this subsection. 

‘‘(D) ANNUAL FEE INCREASE.—The amount of the penalty fee imposed under this subsection shall be increased 

on an annual basis by the annual percentage increase 

in total national health care expenditures, as determined 

by the Secretary. 

‘‘(E) PENALTY LIMIT.—A penalty fee assessed against 

a health plan under this subsection shall not exceed, on 

an annual basis— 

‘‘(i) an amount equal to $20 per covered life under 

such plan; or ‘‘(ii) an amount equal to $40 per covered life under 

the plan if such plan has knowingly provided inaccurate or incomplete information (as described under 

subparagraph (C)). 

‘‘(F) DETERMINATION OF COVERED INDIVIDUALS.—The 

Secretary shall determine the number of covered lives 

under a health plan based upon the most recent statements 

and filings that have been submitted by such plan to the 

Securities and Exchange Commission. 

‘‘(2) NOTICE AND DISPUTE PROCEDURE.—The Secretary shall 

establish a procedure for assessment of penalty fees under 

this subsection that provides a health plan with reasonable 

notice and a dispute resolution procedure prior to provision 

of a notice of assessment by the Secretary of the Treasury 

(as described under paragraph (4)(B)). 

‘‘(3) PENALTY FEE REPORT.—Not later than May 1, 2014, 

and annually thereafter, the Secretary shall provide the Secretary of the Treasury with a report identifying those health 

plans that have been assessed a penalty fee under this subsection. 

‘‘(4) COLLECTION OF PENALTY FEE.— 

‘‘(A) IN GENERAL.—The Secretary of the Treasury, 

acting through the Financial Management Service, shall 

administer the collection of penalty fees from health plans 

that have been identified by the Secretary in the penalty 

fee report provided under paragraph (3). 

‘‘(B) NOTICE.—Not later than August 1, 2014, and 

annually thereafter, the Secretary of the Treasury shall 
H. R. 3590—35 

provide notice to each health plan that has been assessed 

a penalty fee by the Secretary under this subsection. Such 

notice shall include the amount of the penalty fee assessed 

by the Secretary and the due date for payment of such 

fee to the Secretary of the Treasury (as described in 

subparagraph (C)). 

‘‘(C) PAYMENT DUE DATE.—Payment by a health plan 

for a penalty fee assessed under this subsection shall be 

made to the Secretary of the Treasury not later than 

November 1, 2014, and annually thereafter. 

‘‘(D) UNPAID PENALTY FEES.—Any amount of a penalty 

fee assessed against a health plan under this subsection 

for which payment has not been made by the due date 

provided under subparagraph (C) shall be— 

‘‘(i) increased by the interest accrued on such 

amount, as determined pursuant to the underpayment 

rate established under section 6621 of the Internal 

Revenue Code of 1986; and 

‘‘(ii) treated as a past-due, legally enforceable debt 

owed to a Federal agency for purposes of section 

6402(d) of the Internal Revenue Code of 1986. 

‘‘(E) ADMINISTRATIVE FEES.—Any fee charged or allocated for collection activities conducted by the Financial 

Management Service will be passed on to a health plan 

on a pro-rata basis and added to any penalty fee collected 

from the plan.’’. 

(c) PROMULGATION OF RULES.— 

(1) UNIQUE HEALTH PLAN IDENTIFIER.—The Secretary shall 

promulgate a final rule to establish a unique health plan identifier (as described in section 1173(b) of the Social Security 

Act (42 U.S.C. 1320d–2(b))) based on the input of the National 

Committee on Vital and Health Statistics. The Secretary may 

do so on an interim final basis and such rule shall be effective 

not later than October 1, 2012. 

(2) ELECTRONIC FUNDS TRANSFER.—The Secretary shall 

promulgate a final rule to establish a standard for electronic 

funds transfers (as described in section 1173(a)(2)(J) of the 

Social Security Act, as added by subsection (b)(2)(A)). The Secretary may do so on an interim final basis and shall adopt 

such standard not later than January 1, 2012, in a manner 

ensuring that such standard is effective not later than January 

1, 2014. 

(3) HEALTH CLAIMS ATTACHMENTS.—The Secretary shall 

promulgate a final rule to establish a transaction standard 

and a single set of associated operating rules for health claims 

attachments (as described in section 1173(a)(2)(B) of the Social 

Security Act (42 U.S.C. 1320d–2(a)(2)(B))) that is consistent 

with the X12 Version 5010 transaction standards. The Secretary 

may do so on an interim final basis and shall adopt a transaction standard and a single set of associated operating rules 

not later than January 1, 2014, in a manner ensuring that 

such standard is effective not later than January 1, 2016. 

(d) EXPANSION OF ELECTRONIC TRANSACTIONS IN MEDICARE.— 

Section 1862(a) of the Social Security Act (42 U.S.C. 1395y(a)) 

is amended— 

(1) in paragraph (23), by striking the ‘‘or’’ at the end; 
H. R. 3590—36 

(2) in paragraph (24), by striking the period and inserting 

‘‘; or’’; and 

(3) by inserting after paragraph (24) the following new 

paragraph: 

‘‘(25) not later than January 1, 2014, for which the payment 

is other than by electronic funds transfer (EFT) or an electronic 

remittance in a form as specified in ASC X12 835 Health 

Care Payment and Remittance Advice or subsequent standard.’’. 

SEC. 1105. EFFECTIVE DATE. 

This subtitle shall take effect on the date of enactment of 

this Act. 

Subtitle C—Quality Health Insurance 

Coverage for All Americans 

PART I—HEALTH INSURANCE MARKET 

REFORMS 

SEC. 1201. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT. 

Part A of title XXVII of the Public Health Service Act (42 

U.S.C. 300gg et seq.), as amended by section 1001, is further 

amended— 

(1) by striking the heading for subpart 1 and inserting 

the following: 

‘‘Subpart I—General Reform’’; 

(2)(A) in section 2701 (42 U.S.C. 300gg), by striking the 

section heading and subsection (a) and inserting the following: 

‘‘SEC. 2704. PROHIBITION OF PREEXISTING CONDITION EXCLUSIONS 

OR OTHER DISCRIMINATION BASED ON HEALTH STATUS. 

‘‘(a) IN GENERAL.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage may 

not impose any preexisting condition exclusion with respect to such 

plan or coverage.’’; and 

(B) by transferring such section (as amended by subparagraph (A)) so as to appear after the section 2703 added by 

paragraph (4); 

(3)(A) in section 2702 (42 U.S.C. 300gg–1)— 

(i) by striking the section heading and all that follows 

through subsection (a); 

(ii) in subsection (b)— 

(I) by striking ‘‘health insurance issuer offering 

health insurance coverage in connection with a group 

health plan’’ each place that such appears and inserting 

‘‘health insurance issuer offering group or individual 

health insurance coverage’’; and 

(II) in paragraph (2)(A)— 

(aa) by inserting ‘‘or individual’’ after 

‘‘employer’’; and 

(bb) by inserting ‘‘or individual health coverage, as the case may be’’ before the semicolon; 

and 

(iii) in subsection (e)— 
H. R. 3590—37 

(I) by striking ‘‘(a)(1)(F)’’ and inserting ‘‘(a)(6)’’; 

(II) by striking ‘‘2701’’ and inserting ‘‘2704’’; and 

(III) by striking ‘‘2721(a)’’ and inserting ‘‘2735(a)’’; 

and 

(B) by transferring such section (as amended by 

subparagraph (A)) to appear after section 2705(a) as added 

by paragraph (4); and 

(4) by inserting after the subpart heading (as added by 

paragraph (1)) the following: 

‘‘SEC. 2701. FAIR HEALTH INSURANCE PREMIUMS. 

‘‘(a) PROHIBITING DISCRIMINATORY PREMIUM RATES.— 

‘‘(1) IN GENERAL.—With respect to the premium rate 

charged by a health insurance issuer for health insurance coverage offered in the individual or small group market— 

‘‘(A) such rate shall vary with respect to the particular 

plan or coverage involved only by— 

‘‘(i) whether such plan or coverage covers an individual or family; 

‘‘(ii) rating area, as established in accordance with 

paragraph (2); 

‘‘(iii) age, except that such rate shall not vary 

by more than 3 to 1 for adults (consistent with section 

2707(c)); and 

‘‘(iv) tobacco use, except that such rate shall not 

vary by more than 1.5 to 1; and 

‘‘(B) such rate shall not vary with respect to the particular plan or coverage involved by any other factor not 

described in subparagraph (A). 

‘‘(2) RATING AREA.— 

‘‘(A) IN GENERAL.—Each State shall establish 1 or more 

rating areas within that State for purposes of applying 

the requirements of this title. 

‘‘(B) SECRETARIAL REVIEW.—The Secretary shall review 

the rating areas established by each State under subparagraph (A) to ensure the adequacy of such areas for purposes 

of carrying out the requirements of this title. If the Secretary determines a State’s rating areas are not adequate, 

or that a State does not establish such areas, the Secretary 

may establish rating areas for that State. 

‘‘(3) PERMISSIBLE AGE BANDS.—The Secretary, in consultation with the National Association of Insurance Commissioners, 

shall define the permissible age bands for rating purposes 

under paragraph (1)(A)(iii). 

‘‘(4) APPLICATION OF VARIATIONS BASED ON AGE OR TOBACCO

USE.—With respect to family coverage under a group health 

plan or health insurance coverage, the rating variations permitted under clauses (iii) and (iv) of paragraph (1)(A) shall 

be applied based on the portion of the premium that is attributable to each family member covered under the plan or coverage. 

‘‘(5) SPECIAL RULE FOR LARGE GROUP MARKET.—If a State 

permits health insurance issuers that offer coverage in the 

large group market in the State to offer such coverage through 

the State Exchange (as provided for under section 1312(f)(2)(B) 
H. R. 3590—38 

of the Patient Protection and Affordable Care Act), the provisions of this subsection shall apply to all coverage offered 

in such market in the State. 

‘‘SEC. 2702. GUARANTEED AVAILABILITY OF COVERAGE. 

‘‘(a) GUARANTEED ISSUANCE OF COVERAGE IN THE INDIVIDUAL

AND GROUP MARKET.—Subject to subsections (b) through (e), each 

health insurance issuer that offers health insurance coverage in 

the individual or group market in a State must accept every 

employer and individual in the State that applies for such coverage. 

‘‘(b) ENROLLMENT.— ‘‘(1) RESTRICTION.—A health insurance issuer described in 

subsection (a) may restrict enrollment in coverage described 

in such subsection to open or special enrollment periods. 

‘‘(2) ESTABLISHMENT.—A health insurance issuer described 

in subsection (a) shall, in accordance with the regulations 

promulgated under paragraph (3), establish special enrollment 

periods for qualifying events (under section 603 of the Employee 

Retirement Income Security Act of 1974). 

‘‘(3) REGULATIONS.—The Secretary shall promulgate regulations with respect to enrollment periods under paragraphs (1) 

and (2). 

‘‘SEC. 2703. GUARANTEED RENEWABILITY OF COVERAGE. 

‘‘(a) IN GENERAL.—Except as provided in this section, if a health 

insurance issuer offers health insurance coverage in the individual 

or group market, the issuer must renew or continue in force such 

coverage at the option of the plan sponsor or the individual, as 

applicable. 

‘‘SEC. 2705. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL 

PARTICIPANTS AND BENEFICIARIES BASED ON HEALTH 

STATUS. 

‘‘(a) IN GENERAL.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage may 

not establish rules for eligibility (including continued eligibility) 

of any individual to enroll under the terms of the plan or coverage 

based on any of the following health status-related factors in relation to the individual or a dependent of the individual: 

‘‘(1) Health status. 

‘‘(2) Medical condition (including both physical and mental 

illnesses). 

‘‘(3) Claims experience. 

‘‘(4) Receipt of health care. 

‘‘(5) Medical history. 

‘‘(6) Genetic information. 

‘‘(7) Evidence of insurability (including conditions arising 

out of acts of domestic violence). 

‘‘(8) Disability. 

‘‘(9) Any other health status-related factor determined 

appropriate by the Secretary. 

‘‘(j) PROGRAMS OF HEALTH PROMOTION OR DISEASE PREVEN- TION.— ‘‘(1) GENERAL PROVISIONS.— 

‘‘(A) GENERAL RULE.—For purposes of subsection 

(b)(2)(B), a program of health promotion or disease prevention (referred to in this subsection as a ‘wellness program’) 

shall be a program offered by an employer that is designed 
H. R. 3590—39 

to promote health or prevent disease that meets the 

applicable requirements of this subsection. 

‘‘(B) NO CONDITIONS BASED ON HEALTH STATUS

FACTOR.—If none of the conditions for obtaining a premium 

discount or rebate or other reward for participation in 

a wellness program is based on an individual satisfying 

a standard that is related to a health status factor, such 

wellness program shall not violate this section if participation in the program is made available to all similarly 

situated individuals and the requirements of paragraph 

(2) are complied with. 

‘‘(C) CONDITIONS BASED ON HEALTH STATUS FACTOR.— 

If any of the conditions for obtaining a premium discount 

or rebate or other reward for participation in a wellness 

program is based on an individual satisfying a standard 

that is related to a health status factor, such wellness 

program shall not violate this section if the requirements 

of paragraph (3) are complied with. 

‘‘(2) WELLNESS PROGRAMS NOT SUBJECT TO REQUIREMENTS.—If none of the conditions for obtaining a premium 

discount or rebate or other reward under a wellness program 

as described in paragraph (1)(B) are based on an individual 

satisfying a standard that is related to a health status factor 

(or if such a wellness program does not provide such a reward), 

the wellness program shall not violate this section if participation in the program is made available to all similarly situated 

individuals. The following programs shall not have to comply 

with the requirements of paragraph (3) if participation in the 

program is made available to all similarly situated individuals: 

‘‘(A) A program that reimburses all or part of the 

cost for memberships in a fitness center. 

‘‘(B) A diagnostic testing program that provides a 

reward for participation and does not base any part of 

the reward on outcomes. 

‘‘(C) A program that encourages preventive care related 

to a health condition through the waiver of the copayment 

or deductible requirement under group health plan for 

the costs of certain items or services related to a health 

condition (such as prenatal care or well-baby visits). 

‘‘(D) A program that reimburses individuals for the 

costs of smoking cessation programs without regard to 

whether the individual quits smoking. 

‘‘(E) A program that provides a reward to individuals 

for attending a periodic health education seminar. 

‘‘(3) WELLNESS PROGRAMS SUBJECT TO REQUIREMENTS.— 

If any of the conditions for obtaining a premium discount, 

rebate, or reward under a wellness program as described in 

paragraph (1)(C) is based on an individual satisfying a standard 

that is related to a health status factor, the wellness program 

shall not violate this section if the following requirements are 

complied with: 

‘‘(A) The reward for the wellness program, together 

with the reward for other wellness programs with respect 

to the plan that requires satisfaction of a standard related 

to a health status factor, shall not exceed 30 percent of 

the cost of employee-only coverage under the plan. If, in 
H. R. 3590—40 

addition to employees or individuals, any class of dependents (such as spouses or spouses and dependent children) 

may participate fully in the wellness program, such reward 

shall not exceed 30 percent of the cost of the coverage 

in which an employee or individual and any dependents 

are enrolled. For purposes of this paragraph, the cost of 

coverage shall be determined based on the total amount 

of employer and employee contributions for the benefit 

package under which the employee is (or the employee 

and any dependents are) receiving coverage. A reward may 

be in the form of a discount or rebate of a premium or 

contribution, a waiver of all or part of a cost-sharing mechanism (such as deductibles, copayments, or coinsurance), 

the absence of a surcharge, or the value of a benefit that 

would otherwise not be provided under the plan. The Secretaries of Labor, Health and Human Services, and the 

Treasury may increase the reward available under this 

subparagraph to up to 50 percent of the cost of coverage 

if the Secretaries determine that such an increase is appropriate. 

‘‘(B) The wellness program shall be reasonably 

designed to promote health or prevent disease. A program 

complies with the preceding sentence if the program has 

a reasonable chance of improving the health of, or preventing disease in, participating individuals and it is not 

overly burdensome, is not a subterfuge for discriminating 

based on a health status factor, and is not highly suspect 

in the method chosen to promote health or prevent disease. 

‘‘(C) The plan shall give individuals eligible for the 

program the opportunity to qualify for the reward under 

the program at least once each year. 

‘‘(D) The full reward under the wellness program shall 

be made available to all similarly situated individuals. 

For such purpose, among other things: 

‘‘(i) The reward is not available to all similarly 

situated individuals for a period unless the wellness 

program allows— 

‘‘(I) for a reasonable alternative standard (or 

waiver of the otherwise applicable standard) for 

obtaining the reward for any individual for whom, 

for that period, it is unreasonably difficult due 

to a medical condition to satisfy the otherwise 

applicable standard; and 

‘‘(II) for a reasonable alternative standard (or 

waiver of the otherwise applicable standard) for 

obtaining the reward for any individual for whom, 

for that period, it is medically inadvisable to 

attempt to satisfy the otherwise applicable 

standard. 

‘‘(ii) If reasonable under the circumstances, the 

plan or issuer may seek verification, such as a statement from an individual’s physician, that a health 

status factor makes it unreasonably difficult or medically inadvisable for the individual to satisfy or attempt 

to satisfy the otherwise applicable standard. 
H. R. 3590—41 

‘‘(E) The plan or issuer involved shall disclose in all 

plan materials describing the terms of the wellness program the availability of a reasonable alternative standard 

(or the possibility of waiver of the otherwise applicable 

standard) required under subparagraph (D). If plan materials disclose that such a program is available, without 

describing its terms, the disclosure under this subparagraph shall not be required. 

‘‘(k) EXISTING PROGRAMS.—Nothing in this section shall prohibit 

a program of health promotion or disease prevention that was 

established prior to the date of enactment of this section and 

applied with all applicable regulations, and that is operating on 

such date, from continuing to be carried out for as long as such 

regulations remain in effect. 

‘‘(l) WELLNESS PROGRAM DEMONSTRATION PROJECT.— 

‘‘(1) IN GENERAL.—Not later than July 1, 2014, the Secretary, in consultation with the Secretary of the Treasury and 

the Secretary of Labor, shall establish a 10-State demonstration 

project under which participating States shall apply the provisions of subsection (j) to programs of health promotion offered 

by a health insurance issuer that offers health insurance coverage in the individual market in such State. 

‘‘(2) EXPANSION OF DEMONSTRATION PROJECT.—If the Secretary, in consultation with the Secretary of the Treasury and 

the Secretary of Labor, determines that the demonstration 

project described in paragraph (1) is effective, such Secretaries 

may, beginning on July 1, 2017 expand such demonstration 

project to include additional participating States. 

‘‘(3) REQUIREMENTS.— 

‘‘(A) MAINTENANCE OF COVERAGE.—The Secretary, in 

consultation with the Secretary of the Treasury and the 

Secretary of Labor, shall not approve the participation 

of a State in the demonstration project under this section 

unless the Secretaries determine that the State’s project 

is designed in a manner that— 

‘‘(i) will not result in any decrease in coverage; 

and 

‘‘(ii) will not increase the cost to the Federal 

Government in providing credits under section 36B 

of the Internal Revenue Code of 1986 or cost-sharing 

assistance under section 1402 of the Patient Protection 

and Affordable Care Act. 

‘‘(B) OTHER REQUIREMENTS.—States that participate in 

the demonstration project under this subsection— 

‘‘(i) may permit premium discounts or rebates or 

the modification of otherwise applicable copayments 

or deductibles for adherence to, or participation in, 

a reasonably designed program of health promotion 

and disease prevention; 

‘‘(ii) shall ensure that requirements of consumer 

protection are met in programs of health promotion 

in the individual market; 

‘‘(iii) shall require verification from health insurance issuers that offer health insurance coverage in 

the individual market of such State that premium 

discounts— 
H. R. 3590—42 

‘‘(I) do not create undue burdens for individuals insured in the individual market; 

‘‘(II) do not lead to cost shifting; and 

‘‘(III) are not a subterfuge for discrimination; 

‘‘(iv) shall ensure that consumer data is protected 

in accordance with the requirements of section 264(c) 

of the Health Insurance Portability and Accountability 

Act of 1996 (42 U.S.C. 1320d–2 note); and 

‘‘(v) shall ensure and demonstrate to the satisfaction of the Secretary that the discounts or other 

rewards provided under the project reflect the expected 

level of participation in the wellness program involved 

and the anticipated effect the program will have on 

utilization or medical claim costs. 

‘‘(m) REPORT.— 

‘‘(1) IN GENERAL.—Not later than 3 years after the date 

of enactment of the Patient Protection and Affordable Care 

Act, the Secretary, in consultation with the Secretary of the 

Treasury and the Secretary of Labor, shall submit a report 

to the appropriate committees of Congress concerning— 

‘‘(A) the effectiveness of wellness programs (as defined 

in subsection (j)) in promoting health and preventing disease; 

‘‘(B) the impact of such wellness programs on the access 

to care and affordability of coverage for participants and 

non-participants of such programs; 

‘‘(C) the impact of premium-based and cost-sharing 

incentives on participant behavior and the role of such 

programs in changing behavior; and 

‘‘(D) the effectiveness of different types of rewards. 

‘‘(2) DATA COLLECTION.—In preparing the report described 

in paragraph (1), the Secretaries shall gather relevant information from employers who provide employees with access to 

wellness programs, including State and Federal agencies. 

‘‘(n) REGULATIONS.—Nothing in this section shall be construed 

as prohibiting the Secretaries of Labor, Health and Human Services, 

or the Treasury from promulgating regulations in connection with 

this section. 

‘‘SEC. 2706. NON-DISCRIMINATION IN HEALTH CARE. 

‘‘(a) PROVIDERS.—A group health plan and a health insurance 

issuer offering group or individual health insurance coverage shall 

not discriminate with respect to participation under the plan or 

coverage against any health care provider who is acting within 

the scope of that provider’s license or certification under applicable 

State law. This section shall not require that a group health plan 

or health insurance issuer contract with any health care provider 

willing to abide by the terms and conditions for participation established by the plan or issuer. Nothing in this section shall be construed as preventing a group health plan, a health insurance issuer, 

or the Secretary from establishing varying reimbursement rates 

based on quality or performance measures. 

‘‘(b) INDIVIDUALS.—The provisions of section 1558 of the Patient 

Protection and Affordable Care Act (relating to non-discrimination) 

shall apply with respect to a group health plan or health insurance 

issuer offering group or individual health insurance coverage. 
H. R. 3590—43 

‘‘SEC. 2707. COMPREHENSIVE HEALTH INSURANCE COVERAGE. 

‘‘(a) COVERAGE FOR ESSENTIAL HEALTH BENEFITS PACKAGE.— 

A health insurance issuer that offers health insurance coverage 

in the individual or small group market shall ensure that such 

coverage includes the essential health benefits package required 

under section 1302(a) of the Patient Protection and Affordable Care 

Act. 

‘‘(b) COST-SHARING UNDER GROUP HEALTH PLANS.—A group 

health plan shall ensure that any annual cost-sharing imposed 

under the plan does not exceed the limitations provided for under 

paragraphs (1) and (2) of section 1302(c). 

‘‘(c) CHILD-ONLY PLANS.—If a health insurance issuer offers 

health insurance coverage in any level of coverage specified under 

section 1302(d) of the Patient Protection and Affordable Care Act, 

the issuer shall also offer such coverage in that level as a plan 

in which the only enrollees are individuals who, as of the beginning 

of a plan year, have not attained the age of 21. 

‘‘(d) DENTAL ONLY.—This section shall not apply to a plan 

described in section 1302(d)(2)(B)(ii)(I). 

‘‘SEC. 2708. PROHIBITION ON EXCESSIVE WAITING PERIODS. 

‘‘A group health plan and a health insurance issuer offering 

group or individual health insurance coverage shall not apply any 

waiting period (as defined in section 2704(b)(4)) that exceeds 90 

days.’’. 

PART II—OTHER PROVISIONS 

SEC. 1251. PRESERVATION OF RIGHT TO MAINTAIN EXISTING COVERAGE. 

(a) NO CHANGES TO EXISTING COVERAGE.— 

(1) IN GENERAL.—Nothing in this Act (or an amendment 

made by this Act) shall be construed to require that an individual terminate coverage under a group health plan or health 

insurance coverage in which such individual was enrolled on 

the date of enactment of this Act. 

(2) CONTINUATION OF COVERAGE.—With respect to a group 

health plan or health insurance coverage in which an individual 

was enrolled on the date of enactment of this Act, this subtitle 

and subtitle A (and the amendments made by such subtitles) 

shall not apply to such plan or coverage, regardless of whether 

the individual renews such coverage after such date of enactment. 

(b) ALLOWANCE FOR FAMILY MEMBERS TO JOIN CURRENT COVERAGE.—With respect to a group health plan or health insurance 

coverage in which an individual was enrolled on the date of enactment of this Act and which is renewed after such date, family 

members of such individual shall be permitted to enroll in such 

plan or coverage if such enrollment is permitted under the terms 

of the plan in effect as of such date of enactment. 

(c) ALLOWANCE FOR NEW EMPLOYEES TO JOIN CURRENT PLAN.— 

A group health plan that provides coverage on the date of enactment 

of this Act may provide for the enrolling of new employees (and 

their families) in such plan, and this subtitle and subtitle A (and 

the amendments made by such subtitles) shall not apply with 

respect to such plan and such new employees (and their families). 
H. R. 3590—44 

(d) EFFECT ON COLLECTIVE BARGAINING AGREEMENTS.—In the 

case of health insurance coverage maintained pursuant to one or 

more collective bargaining agreements between employee representatives and one or more employers that was ratified before the 

date of enactment of this Act, the provisions of this subtitle and 

subtitle A (and the amendments made by such subtitles) shall 

not apply until the date on which the last of the collective bargaining agreements relating to the coverage terminates. Any coverage amendment made pursuant to a collective bargaining agreement relating to the coverage which amends the coverage solely 

to conform to any requirement added by this subtitle or subtitle 

A (or amendments) shall not be treated as a termination of such 

collective bargaining agreement. 

(e) DEFINITION.—In this title, the term ‘‘grandfathered health 

plan’’ means any group health plan or health insurance coverage 

to which this section applies. 

SEC. 1252. RATING REFORMS MUST APPLY UNIFORMLY TO ALL 

HEALTH INSURANCE ISSUERS AND GROUP HEALTH 

PLANS. 

Any standard or requirement adopted by a State pursuant 

to this title, or any amendment made by this title, shall be applied 

uniformly to all health plans in each insurance market to which 

the standard and requirements apply. The preceding sentence shall 

also apply to a State standard or requirement relating to the 

standard or requirement required by this title (or any such amendment) that is not the same as the standard or requirement but 

that is not preempted under section 1321(d). 

SEC. 1253. EFFECTIVE DATES. 

This subtitle (and the amendments made by this subtitle) shall 

become effective for plan years beginning on or after January 1, 

2014. 

Subtitle D—Available Coverage Choices for 

All Americans 

PART I—ESTABLISHMENT OF QUALIFIED 

HEALTH PLANS 

SEC. 1301. QUALIFIED HEALTH PLAN DEFINED. 

(a) QUALIFIED HEALTH PLAN.—In this title: 

(1) IN GENERAL.—The term ‘‘qualified health plan’’ means 

a health plan that— 

(A) has in effect a certification (which may include 

a seal or other indication of approval) that such plan meets 

the criteria for certification described in section 1311(c) 

issued or recognized by each Exchange through which such 

plan is offered; 

(B) provides the essential health benefits package 

described in section 1302(a); and 

(C) is offered by a health insurance issuer that— 

(i) is licensed and in good standing to offer health 

insurance coverage in each State in which such issuer 

offers health insurance coverage under this title; 
H. R. 3590—45 

(ii) agrees to offer at least one qualified health 

plan in the silver level and at least one plan in the 

gold level in each such Exchange; 

(iii) agrees to charge the same premium rate for 

each qualified health plan of the issuer without regard 

to whether the plan is offered through an Exchange 

or whether the plan is offered directly from the issuer 

or through an agent; and 

(iv) complies with the regulations developed by 

the Secretary under section 1311(d) and such other 

requirements as an applicable Exchange may establish. 

(2) INCLUSION OF CO-OP PLANS AND COMMUNITY HEALTH

INSURANCE OPTION.—Any reference in this title to a qualified 

health plan shall be deemed to include a qualified health plan 

offered through the CO-OP program under section 1322 or 

a community health insurance option under section 1323, unless 

specifically provided for otherwise. 

(b) TERMS RELATING TO HEALTH PLANS.—In this title: 

(1) HEALTH PLAN.— 

(A) IN GENERAL.—The term ‘‘health plan’’ means health 

insurance coverage and a group health plan. 

(B) EXCEPTION FOR SELF-INSURED PLANS AND MEWAS.— 

Except to the extent specifically provided by this title, 

the term ‘‘health plan’’ shall not include a group health 

plan or multiple employer welfare arrangement to the 

extent the plan or arrangement is not subject to State 

insurance regulation under section 514 of the Employee 

Retirement Income Security Act of 1974. 

(2) HEALTH INSURANCE COVERAGE AND ISSUER.—The terms 

‘‘health insurance coverage’’ and ‘‘health insurance issuer’’ have 

the meanings given such terms by section 2791(b) of the Public 

Health Service Act. 

(3) GROUP HEALTH PLAN.—The term ‘‘group health plan’’ 

has the meaning given such term by section 2791(a) of the 

Public Health Service Act. 

SEC. 1302. ESSENTIAL HEALTH BENEFITS REQUIREMENTS. 

(a) ESSENTIAL HEALTH BENEFITS PACKAGE.—In this title, the 

term ‘‘essential health benefits package’’ means, with respect to 

any health plan, coverage that— 

(1) provides for the essential health benefits defined by 

the Secretary under subsection (b); 

(2) limits cost-sharing for such coverage in accordance with 

subsection (c); and 

(3) subject to subsection (e), provides either the bronze, 

silver, gold, or platinum level of coverage described in subsection (d). 

(b) ESSENTIAL HEALTH BENEFITS.— 

(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

shall define the essential health benefits, except that such 

benefits shall include at least the following general categories 

and the items and services covered within the categories: 

(A) Ambulatory patient services. 

(B) Emergency services. 

(C) Hospitalization. 

(D) Maternity and newborn care. 
H. R. 3590—46 

(E) Mental health and substance use disorder services, 

including behavioral health treatment. 

(F) Prescription drugs. 

(G) Rehabilitative and habilitative services and devices. 

(H) Laboratory services. 

(I) Preventive and wellness services and chronic disease management. 

(J) Pediatric services, including oral and vision care. 

(2) LIMITATION.— 

(A) IN GENERAL.—The Secretary shall ensure that the 

scope of the essential health benefits under paragraph (1) 

is equal to the scope of benefits provided under a typical 

employer plan, as determined by the Secretary. To inform 

this determination, the Secretary of Labor shall conduct 

a survey of employer-sponsored coverage to determine the 

benefits typically covered by employers, including multiemployer plans, and provide a report on such survey to the 

Secretary. 

(B) CERTIFICATION.—In defining the essential health 

benefits described in paragraph (1), and in revising the 

benefits under paragraph (4)(H), the Secretary shall submit 

a report to the appropriate committees of Congress containing a certification from the Chief Actuary of the Centers 

for Medicare & Medicaid Services that such essential health 

benefits meet the limitation described in paragraph (2). 

(3) NOTICE AND HEARING.—In defining the essential health 

benefits described in paragraph (1), and in revising the benefits 

under paragraph (4)(H), the Secretary shall provide notice and 

an opportunity for public comment. 

(4) REQUIRED ELEMENTS FOR CONSIDERATION.—In defining 

the essential health benefits under paragraph (1), the Secretary 

shall— 

(A) ensure that such essential health benefits reflect 

an appropriate balance among the categories described in 

such subsection, so that benefits are not unduly weighted 

toward any category; 

(B) not make coverage decisions, determine reimbursement rates, establish incentive programs, or design benefits 

in ways that discriminate against individuals because of 

their age, disability, or expected length of life; 

(C) take into account the health care needs of diverse 

segments of the population, including women, children, 

persons with disabilities, and other groups; 

(D) ensure that health benefits established as essential 

not be subject to denial to individuals against their wishes 

on the basis of the individuals’ age or expected length 

of life or of the individuals’ present or predicted disability, 

degree of medical dependency, or quality of life; 

(E) provide that a qualified health plan shall not be 

treated as providing coverage for the essential health benefits described in paragraph (1) unless the plan provides 

that— 

(i) coverage for emergency department services will 

be provided without imposing any requirement under 

the plan for prior authorization of services or any 

limitation on coverage where the provider of services 

does not have a contractual relationship with the plan 
H. R. 3590—47 

for the providing of services that is more restrictive 

than the requirements or limitations that apply to 

emergency department services received from providers 

who do have such a contractual relationship with the 

plan; and 

(ii) if such services are provided out-of-network, 

the cost-sharing requirement (expressed as a 

copayment amount or coinsurance rate) is the same 

requirement that would apply if such services were 

provided in-network; 

(F) provide that if a plan described in section 

1311(b)(2)(B)(ii) (relating to stand-alone dental benefits 

plans) is offered through an Exchange, another health plan 

offered through such Exchange shall not fail to be treated 

as a qualified health plan solely because the plan does 

not offer coverage of benefits offered through the standalone plan that are otherwise required under paragraph 

(1)(J); and 

(G) periodically review the essential health benefits 

under paragraph (1), and provide a report to Congress 

and the public that contains— 

(i) an assessment of whether enrollees are facing 

any difficulty accessing needed services for reasons 

of coverage or cost; 

(ii) an assessment of whether the essential health 

benefits needs to be modified or updated to account 

for changes in medical evidence or scientific advancement; 

(iii) information on how the essential health benefits will be modified to address any such gaps in access 

or changes in the evidence base; 

(iv) an assessment of the potential of additional 

or expanded benefits to increase costs and the interactions between the addition or expansion of benefits 

and reductions in existing benefits to meet actuarial 

limitations described in paragraph (2); and 

(H) periodically update the essential health benefits 

under paragraph (1) to address any gaps in access to coverage or changes in the evidence base the Secretary identifies in the review conducted under subparagraph (G). 

(5) RULE OF CONSTRUCTION.—Nothing in this title shall 

be construed to prohibit a health plan from providing benefits 

in excess of the essential health benefits described in this 

subsection. 

(c) REQUIREMENTS RELATING TO COST-SHARING.— 

(1) ANNUAL LIMITATION ON COST-SHARING.— 

(A) 2014.—The cost-sharing incurred under a health 

plan with respect to self-only coverage or coverage other 

than self-only coverage for a plan year beginning in 2014 

shall not exceed the dollar amounts in effect under section 

223(c)(2)(A)(ii) of the Internal Revenue Code of 1986 for 

self-only and family coverage, respectively, for taxable years 

beginning in 2014. 

(B) 2015 AND LATER.—In the case of any plan year 

beginning in a calendar year after 2014, the limitation 

under this paragraph shall— 
H. R. 3590—48 

(i) in the case of self-only coverage, be equal to 

the dollar amount under subparagraph (A) for selfonly coverage for plan years beginning in 2014, 

increased by an amount equal to the product of that 

amount and the premium adjustment percentage under 

paragraph (4) for the calendar year; and 

(ii) in the case of other coverage, twice the amount 

in effect under clause (i). 

If the amount of any increase under clause (i) is not a 

multiple of $50, such increase shall be rounded to the 

next lowest multiple of $50. 

(2) ANNUAL LIMITATION ON DEDUCTIBLES FOR EMPLOYERSPONSORED PLANS.— 

(A) IN GENERAL.—In the case of a health plan offered 

in the small group market, the deductible under the plan 

shall not exceed— 

(i) $2,000 in the case of a plan covering a single 

individual; and 

(ii) $4,000 in the case of any other plan. 

The amounts under clauses (i) and (ii) may be increased 

by the maximum amount of reimbursement which is 

reasonably available to a participant under a flexible 

spending arrangement described in section 106(c)(2) of the 

Internal Revenue Code of 1986 (determined without regard 

to any salary reduction arrangement). 

(B) INDEXING OF LIMITS.—In the case of any plan year 

beginning in a calendar year after 2014— 

(i) the dollar amount under subparagraph (A)(i) 

shall be increased by an amount equal to the product 

of that amount and the premium adjustment percentage under paragraph (4) for the calendar year; and 

(ii) the dollar amount under subparagraph (A)(ii) 

shall be increased to an amount equal to twice the 

amount in effect under subparagraph (A)(i) for plan 

years beginning in the calendar year, determined after 

application of clause (i). 

If the amount of any increase under clause (i) is not a 

multiple of $50, such increase shall be rounded to the 

next lowest multiple of $50. 

(C) ACTUARIAL VALUE.—The limitation under this paragraph shall be applied in such a manner so as to not 

affect the actuarial value of any health plan, including 

a plan in the bronze level. 

(D) COORDINATION WITH PREVENTIVE LIMITS.—Nothing 

in this paragraph shall be construed to allow a plan to 

have a deductible under the plan apply to benefits described 

in section 2713 of the Public Health Service Act. 

(3) COST-SHARING.—In this title— 

(A) IN GENERAL.—The term ‘‘cost-sharing’’ includes— 

(i) deductibles, coinsurance, copayments, or similar 

charges; and 

(ii) any other expenditure required of an insured 

individual which is a qualified medical expense (within 

the meaning of section 223(d)(2) of the Internal Revenue Code of 1986) with respect to essential health 

benefits covered under the plan. 
H. R. 3590—49 

(B) EXCEPTIONS.—Such term does not include premiums, balance billing amounts for non-network providers, 

or spending for non-covered services. 

(4) PREMIUM ADJUSTMENT PERCENTAGE.—For purposes of 

paragraphs (1)(B)(i) and (2)(B)(i), the premium adjustment 

percentage for any calendar year is the percentage (if any) 

by which the average per capita premium for health insurance 

coverage in the United States for the preceding calendar year 

(as estimated by the Secretary no later than October 1 of 

such preceding calendar year) exceeds such average per capita 

premium for 2013 (as determined by the Secretary). 

(d) LEVELS OF COVERAGE.— 

(1) LEVELS OF COVERAGE DEFINED.—The levels of coverage 

described in this subsection are as follows: 

(A) BRONZE LEVEL.—A plan in the bronze level shall 

provide a level of coverage that is designed to provide 

benefits that are actuarially equivalent to 60 percent of 

the full actuarial value of the benefits provided under 

the plan. 

(B) SILVER LEVEL.—A plan in the silver level shall 

provide a level of coverage that is designed to provide 

benefits that are actuarially equivalent to 70 percent of 

the full actuarial value of the benefits provided under 

the plan. 

(C) GOLD LEVEL.—A plan in the gold level shall provide 

a level of coverage that is designed to provide benefits 

that are actuarially equivalent to 80 percent of the full 

actuarial value of the benefits provided under the plan. 

(D) PLATINUM LEVEL.—A plan in the platinum level 

shall provide a level of coverage that is designed to provide 

benefits that are actuarially equivalent to 90 percent of 

the full actuarial value of the benefits provided under 

the plan. 

(2) ACTUARIAL VALUE.— (A) IN GENERAL.—Under regulations issued by the Secretary, the level of coverage of a plan shall be determined 

on the basis that the essential health benefits described 

in subsection (b) shall be provided to a standard population 

(and without regard to the population the plan may actually 

provide benefits to). 

(B) EMPLOYER CONTRIBUTIONS.—The Secretary may 

issue regulations under which employer contributions to 

a health savings account (within the meaning of section 

223 of the Internal Revenue Code of 1986) may be taken 

into account in determining the level of coverage for a 

plan of the employer. 

(C) APPLICATION.—In determining under this title, the 

Public Health Service Act, or the Internal Revenue Code 

of 1986 the percentage of the total allowed costs of benefits 

provided under a group health plan or health insurance 

coverage that are provided by such plan or coverage, the 

rules contained in the regulations under this paragraph 

shall apply. 

(3) ALLOWABLE VARIANCE.—The Secretary shall develop 

guidelines to provide for a de minimis variation in the actuarial 

valuations used in determining the level of coverage of a plan 

to account for differences in actuarial estimates. 
H. R. 3590—50 

(4) PLAN REFERENCE.—In this title, any reference to a 

bronze, silver, gold, or platinum plan shall be treated as a 

reference to a qualified health plan providing a bronze, silver, 

gold, or platinum level of coverage, as the case may be. 

(e) CATASTROPHIC PLAN.— 

(1) IN GENERAL.—A health plan not providing a bronze, 

silver, gold, or platinum level of coverage shall be treated 

as meeting the requirements of subsection (d) with respect 

to any plan year if— 

(A) the only individuals who are eligible to enroll in 

the plan are individuals described in paragraph (2); and 

(B) the plan provides— 

(i) except as provided in clause (ii), the essential 

health benefits determined under subsection (b), except 

that the plan provides no benefits for any plan year 

until the individual has incurred cost-sharing expenses 

in an amount equal to the annual limitation in effect 

under subsection (c)(1) for the plan year (except as 

provided for in section 2713); and 

(ii) coverage for at least three primary care visits. 

(2) INDIVIDUALS ELIGIBLE FOR ENROLLMENT.—An individual 

is described in this paragraph for any plan year if the individual— 

(A) has not attained the age of 30 before the beginning 

of the plan year; or 

(B) has a certification in effect for any plan year under 

this title that the individual is exempt from the requirement under section 5000A of the Internal Revenue Code 

of 1986 by reason of— 

(i) section 5000A(e)(1) of such Code (relating to 

individuals without affordable coverage); or 

(ii) section 5000A(e)(5) of such Code (relating to 

individuals with hardships). 

(3) RESTRICTION TO INDIVIDUAL MARKET.—If a health insurance issuer offers a health plan described in this subsection, 

the issuer may only offer the plan in the individual market. 

(f) CHILD-ONLY PLANS.—If a qualified health plan is offered 

through the Exchange in any level of coverage specified under 

subsection (d), the issuer shall also offer that plan through the 

Exchange in that level as a plan in which the only enrollees are 

individuals who, as of the beginning of a plan year, have not 

attained the age of 21, and such plan shall be treated as a qualified 

health plan. 

SEC. 1303. SPECIAL RULES. 

(a) SPECIAL RULES RELATING TO COVERAGE OF ABORTION SERV- ICES.— (1) VOLUNTARY CHOICE OF COVERAGE OF ABORTION SERV- ICES.— (A) IN GENERAL.—Notwithstanding any other provision 

of this title (or any amendment made by this title), and 

subject to subparagraphs (C) and (D)— 

(i) nothing in this title (or any amendment made 

by this title), shall be construed to require a qualified 

health plan to provide coverage of services described 

in subparagraph (B)(i) or (B)(ii) as part of its essential 

health benefits for any plan year; and 
H. R. 3590—51 

(ii) the issuer of a qualified health plan shall determine whether or not the plan provides coverage of 

services described in subparagraph (B)(i) or (B)(ii) as 

part of such benefits for the plan year. 

(B) ABORTION SERVICES.— 

(i) ABORTIONS FOR WHICH PUBLIC FUNDING IS

PROHIBITED.—The services described in this clause are 

abortions for which the expenditure of Federal funds 

appropriated for the Department of Health and Human 

Services is not permitted, based on the law as in effect 

as of the date that is 6 months before the beginning 

of the plan year involved. 

(ii) ABORTIONS FOR WHICH PUBLIC FUNDING IS

ALLOWED.—The services described in this clause are 

abortions for which the expenditure of Federal funds 

appropriated for the Department of Health and Human 

Services is permitted, based on the law as in effect 

as of the date that is 6 months before the beginning 

of the plan year involved. 

(C) PROHIBITION ON FEDERAL FUNDS FOR ABORTION

SERVICES IN COMMUNITY HEALTH INSURANCE OPTION.— 

(i) DETERMINATION BY SECRETARY.—The Secretary 

may not determine, in accordance with subparagraph 

(A)(ii), that the community health insurance option 

established under section 1323 shall provide coverage 

of services described in subparagraph (B)(i) as part 

of benefits for the plan year unless the Secretary— 

(I) assures compliance with the requirements 

of paragraph (2); 

(II) assures, in accordance with applicable 

provisions of generally accepted accounting 

requirements, circulars on funds management of 

the Office of Management and Budget, and guidance on accounting of the Government Accountability Office, that no Federal funds are used for 

such coverage; and 

(III) notwithstanding section 1323(e)(1)(C) or 

any other provision of this title, takes all necessary 

steps to assure that the United States does not 

bear the insurance risk for a community health 

insurance option’s coverage of services described 

in subparagraph (B)(i). 

(ii) STATE REQUIREMENT.—If a State requires, in 

addition to the essential health benefits required under 

section 1323(b)(3) (A), coverage of services described 

in subparagraph (B)(i) for enrollees of a community 

health insurance option offered in such State, the State 

shall assure that no funds flowing through or from 

the community health insurance option, and no other 

Federal funds, pay or defray the cost of providing coverage of services described in subparagraph (B)(i). The 

United States shall not bear the insurance risk for 

a State’s required coverage of services described in 

subparagraph (B)(i). 

(iii) EXCEPTIONS.—Nothing in this subparagraph 

shall apply to coverage of services described in subparagraph (B)(ii) by the community health insurance 
H. R. 3590—52 

option. Services described in subparagraph (B)(ii) shall 

be covered to the same extent as such services are 

covered under title XIX of the Social Security Act. 

(D) ASSURED AVAILABILITY OF VARIED COVERAGE

THROUGH EXCHANGES.— 

(i) IN GENERAL.—The Secretary shall assure that 

with respect to qualified health plans offered in any 

Exchange established pursuant to this title— 

(I) there is at least one such plan that provides 

coverage of services described in clauses (i) and 

(ii) of subparagraph (B); and 

(II) there is at least one such plan that does 

not provide coverage of services described in 

subparagraph (B)(i). 

(ii) SPECIAL RULES.—For purposes of clause (i)— 

(I) a plan shall be treated as described in 

clause (i)(II) if the plan does not provide coverage 

of services described in either subparagraph (B)(i) 

or (B)(ii); and 

(II) if a State has one Exchange covering more 

than 1 insurance market, the Secretary shall meet 

the requirements of clause (i) separately with 

respect to each such market. 

(2) PROHIBITION ON THE USE OF FEDERAL FUNDS.— 

(A) IN GENERAL.—If a qualified health plan provides 

coverage of services described in paragraph (1)(B)(i), the 

issuer of the plan shall not use any amount attributable 

to any of the following for purposes of paying for such 

services: 

(i) The credit under section 36B of the Internal 

Revenue Code of 1986 (and the amount (if any) of 

the advance payment of the credit under section 1412 

of the Patient Protection and Affordable Care Act). 

(ii) Any cost-sharing reduction under section 1402 

of thePatient Protection and Affordable Care Act (and 

the amount (if any) of the advance payment of the 

reduction under section 1412 of the Patient Protection 

and Affordable Care Act). 

(B) SEGREGATION OF FUNDS.—In the case of a plan 

to which subparagraph (A) applies, the issuer of the plan 

shall, out of amounts not described in subparagraph (A), 

segregate an amount equal to the actuarial amounts determined under subparagraph (C) for all enrollees from the 

amounts described in subparagraph (A). 

(C) ACTUARIAL VALUE OF OPTIONAL SERVICE COVERAGE.— 

(i) IN GENERAL.—The Secretary shall estimate the 

basic per enrollee, per month cost, determined on an 

average actuarial basis, for including coverage under 

a qualified health plan of the services described in 

paragraph (1)(B)(i). 

(ii) CONSIDERATIONS.—In making such estimate, 

the Secretary— 

(I) may take into account the impact on overall 

costs of the inclusion of such coverage, but may 

not take into account any cost reduction estimated 
H. R. 3590—53 

to result from such services, including prenatal 

care, delivery, or postnatal care; 

(II) shall estimate such costs as if such coverage were included for the entire population covered; and 

(III) may not estimate such a cost at less 

than $1 per enrollee, per month. 

(3) PROVIDER CONSCIENCE PROTECTIONS.—No individual 

health care provider or health care facility may be discriminated 

against because of a willingness or an unwillingness, if doing 

so is contrary to the religious or moral beliefs of the provider 

or facility, to provide, pay for, provide coverage of, or refer 

for abortions. 

(b) APPLICATION OF STATE AND FEDERAL LAWS REGARDING

ABORTION.— 

(1) NO PREEMPTION OF STATE LAWS REGARDING ABORTION.— 

Nothing in this Act shall be construed to preempt or otherwise 

have any effect on State laws regarding the prohibition of 

(or requirement of) coverage, funding, or procedural requirements on abortions, including parental notification or consent 

for the performance of an abortion on a minor. 

(2) NO EFFECT ON FEDERAL LAWS REGARDING ABORTION.— 

(A) IN GENERAL.—Nothing in this Act shall be construed to have any effect on Federal laws regarding— 

(i) conscience protection; 

(ii) willingness or refusal to provide abortion; and 

(iii) discrimination on the basis of the willingness 

or refusal to provide, pay for, cover, or refer for abortion 

or to provide or participate in training to provide abortion. 

(3) NO EFFECT ON FEDERAL CIVIL RIGHTS LAW.—Nothing 

in this subsection shall alter the rights and obligations of 

employees and employers under title VII of the Civil Rights 

Act of 1964. 

(c) APPLICATION OF EMERGENCY SERVICES LAWS.—Nothing in 

this Act shall be construed to relieve any health care provider 

from providing emergency services as required by State or Federal 

law, including section 1867 of the Social Security Act (popularly 

known as ‘‘EMTALA’’). 

SEC. 1304. RELATED DEFINITIONS. 

(a) DEFINITIONS RELATING TO MARKETS.—In this title: 

(1) GROUP MARKET.—The term ‘‘group market’’ means the 

health insurance market under which individuals obtain health 

insurance coverage (directly or through any arrangement) on 

behalf of themselves (and their dependents) through a group 

health plan maintained by an employer. 

(2) INDIVIDUAL MARKET.—The term ‘‘individual market’’ 

means the market for health insurance coverage offered to 

individuals other than in connection with a group health plan. 

(3) LARGE AND SMALL GROUP MARKETS.—The terms ‘‘large 

group market’’ and ‘‘small group market’’ mean the health 

insurance market under which individuals obtain health insurance coverage (directly or through any arrangement) on behalf 

of themselves (and their dependents) through a group health 

plan maintained by a large employer (as defined in subsection 
H. R. 3590—54 

(b)(1)) or by a small employer (as defined in subsection (b)(2)), 

respectively. 

(b) EMPLOYERS.—In this title: 

(1) LARGE EMPLOYER.—The term ‘‘large employer’’ means, 

in connection with a group health plan with respect to a calendar year and a plan year, an employer who employed an 

average of at least 101 employees on business days during 

the preceding calendar year and who employs at least 1 

employee on the first day of the plan year. 

(2) SMALL EMPLOYER.—The term ‘‘small employer’’ means, 

in connection with a group health plan with respect to a calendar year and a plan year, an employer who employed an 

average of at least 1 but not more than 100 employees on 

business days during the preceding calendar year and who 

employs at least 1 employee on the first day of the plan year. 

(3) STATE OPTION TO TREAT 50 EMPLOYEES AS SMALL.— 

In the case of plan years beginning before January 1, 2016, 

a State may elect to apply this subsection by substituting 

‘‘51 employees’’ for ‘‘101 employees’’ in paragraph (1) and by 

substituting ‘‘50 employees’’ for ‘‘100 employees’’ in paragraph 

(2). 

(4) RULES FOR DETERMINING EMPLOYER SIZE.—For purposes 

of this subsection— 

(A) APPLICATION OF AGGREGATION RULE FOR

EMPLOYERS.—All persons treated as a single employer 

under subsection (b), (c), (m), or (o) of section 414 of the 

Internal Revenue Code of 1986 shall be treated as 1 

employer. 

(B) EMPLOYERS NOT IN EXISTENCE IN PRECEDING

YEAR.—In the case of an employer which was not in existence throughout the preceding calendar year, the determination of whether such employer is a small or large 

employer shall be based on the average number of 

employees that it is reasonably expected such employer 

will employ on business days in the current calendar year. 

(C) PREDECESSORS.—Any reference in this subsection 

to an employer shall include a reference to any predecessor 

of such employer. 

(D) CONTINUATION OF PARTICIPATION FOR GROWING

SMALL EMPLOYERS.—If— 

(i) a qualified employer that is a small employer 

makes enrollment in qualified health plans offered in 

the small group market available to its employees 

through an Exchange; and 

(ii) the employer ceases to be a small employer 

by reason of an increase in the number of employees 

of such employer; 

the employer shall continue to be treated as a small 

employer for purposes of this subtitle for the period beginning with the increase and ending with the first day on 

which the employer does not make such enrollment available to its employees. 

(c) SECRETARY.—In this title, the term ‘‘Secretary’’ means the 

Secretary of Health and Human Services. 

(d) STATE.—In this title, the term ‘‘State’’ means each of the 

50 States and the District of Columbia. 
H. R. 3590—55 

PART II—CONSUMER CHOICES AND INSURANCE COMPETITION THROUGH HEALTH 

BENEFIT EXCHANGES 

SEC. 1311. AFFORDABLE CHOICES OF HEALTH BENEFIT PLANS. 

(a) ASSISTANCE TO STATES TO ESTABLISH AMERICAN HEALTH

BENEFIT EXCHANGES.— (1) PLANNING AND ESTABLISHMENT GRANTS.—There shall 

be appropriated to the Secretary, out of any moneys in the 

Treasury not otherwise appropriated, an amount necessary to 

enable the Secretary to make awards, not later than 1 year 

after the date of enactment of this Act, to States in the amount 

specified in paragraph (2) for the uses described in paragraph 

(3). 

(2) AMOUNT SPECIFIED.—For each fiscal year, the Secretary 

shall determine the total amount that the Secretary will make 

available to each State for grants under this subsection. 

(3) USE OF FUNDS.—A State shall use amounts awarded 

under this subsection for activities (including planning activities) related to establishing an American Health Benefit 

Exchange, as described in subsection (b). 

(4) RENEWABILITY OF GRANT.— 

(A) IN GENERAL.—Subject to subsection (d)(4), the Secretary may renew a grant awarded under paragraph (1) 

if the State recipient of such grant— 

(i) is making progress, as determined by the Secretary, toward— 

(I) establishing an Exchange; and 

(II) implementing the reforms described in 

subtitles A and C (and the amendments made 

by such subtitles); and 

(ii) is meeting such other benchmarks as the Secretary may establish. 

(B) LIMITATION.—No grant shall be awarded under 

this subsection after January 1, 2015. 

(5) TECHNICAL ASSISTANCE TO FACILITATE PARTICIPATION

IN SHOP EXCHANGES.—The Secretary shall provide technical 

assistance to States to facilitate the participation of qualified 

small businesses in such States in SHOP Exchanges. 

(b) AMERICAN HEALTH BENEFIT EXCHANGES.— 

(1) IN GENERAL.—Each State shall, not later than January 

1, 2014, establish an American Health Benefit Exchange 

(referred to in this title as an ‘‘Exchange’’) for the State that— 

(A) facilitates the purchase of qualified health plans; 

(B) provides for the establishment of a Small Business 

Health Options Program (in this title referred to as a 

‘‘SHOP Exchange’’) that is designed to assist qualified 

employers in the State who are small employers in facilitating the enrollment of their employees in qualified health 

plans offered in the small group market in the State; 

and 

(C) meets the requirements of subsection (d). 

(2) MERGER OF INDIVIDUAL AND SHOP EXCHANGES.—A State 

may elect to provide only one Exchange in the State for providing both Exchange and SHOP Exchange services to both 

qualified individuals and qualified small employers, but only 
H. R. 3590—56 

if the Exchange has adequate resources to assist such individuals and employers. 

(c) RESPONSIBILITIES OF THE SECRETARY.— 

(1) IN GENERAL.—The Secretary shall, by regulation, establish criteria for the certification of health plans as qualified 

health plans. Such criteria shall require that, to be certified, 

a plan shall, at a minimum— 

(A) meet marketing requirements, and not employ marketing practices or benefit designs that have the effect 

of discouraging the enrollment in such plan by individuals 

with significant health needs; 

(B) ensure a sufficient choice of providers (in a manner 

consistent with applicable network adequacy provisions 

under section 2702(c) of the Public Health Service Act), 

and provide information to enrollees and prospective 

enrollees on the availability of in-network and out-of-network providers; 

(C) include within health insurance plan networks 

those essential community providers, where available, that 

serve predominately low-income, medically-underserved 

individuals, such as health care providers defined in section 

340B(a)(4) of the Public Health Service Act and providers 

described in section 1927(c)(1)(D)(i)(IV) of the Social Security Act as set forth by section 221 of Public Law 111– 

8, except that nothing in this subparagraph shall be construed to require any health plan to provide coverage for 

any specific medical procedure; 

(D)(i) be accredited with respect to local performance 

on clinical quality measures such as the Healthcare 

Effectiveness Data and Information Set, patient experience 

ratings on a standardized Consumer Assessment of 

Healthcare Providers and Systems survey, as well as consumer access, utilization management, quality assurance, 

provider credentialing, complaints and appeals, network 

adequacy and access, and patient information programs 

by any entity recognized by the Secretary for the accreditation of health insurance issuers or plans (so long as any 

such entity has transparent and rigorous methodological 

and scoring criteria); or 

(ii) receive such accreditation within a period established by an Exchange for such accreditation that is 

applicable to all qualified health plans; 

(E) implement a quality improvement strategy 

described in subsection (g)(1); 

(F) utilize a uniform enrollment form that qualified 

individuals and qualified employers may use (either electronically or on paper) in enrolling in qualified health plans 

offered through such Exchange, and that takes into account 

criteria that the National Association of Insurance Commissioners develops and submits to the Secretary; 

(G) utilize the standard format established for presenting health benefits plan options; and 

(H) provide information to enrollees and prospective 

enrollees, and to each Exchange in which the plan is 

offered, on any quality measures for health plan performance endorsed under section 399JJ of the Public Health 

Service Act, as applicable. 
H. R. 3590—57 

(2) RULE OF CONSTRUCTION.—Nothing in paragraph (1)(C) 

shall be construed to require a qualified health plan to contract 

with a provider described in such paragraph if such provider 

refuses to accept the generally applicable payment rates of 

such plan. 

(3) RATING SYSTEM.—The Secretary shall develop a rating 

system that would rate qualified health plans offered through 

an Exchange in each benefits level on the basis of the relative 

quality and price. The Exchange shall include the quality rating 

in the information provided to individuals and employers 

through the Internet portal established under paragraph (4). 

(4) ENROLLEE SATISFACTION SYSTEM.—The Secretary shall 

develop an enrollee satisfaction survey system that would 

evaluate the level of enrollee satisfaction with qualified health 

plans offered through an Exchange, for each such qualified 

health plan that had more than 500 enrollees in the previous 

year. The Exchange shall include enrollee satisfaction information in the information provided to individuals and employers 

through the Internet portal established under paragraph (5) 

in a manner that allows individuals to easily compare enrollee 

satisfaction levels between comparable plans. 

(5) INTERNET PORTALS.—The Secretary shall— 

(A) continue to operate, maintain, and update the 

Internet portal developed under section 1103(a) and to 

assist States in developing and maintaining their own such 

portal; and 

(B) make available for use by Exchanges a model template for an Internet portal that may be used to direct 

qualified individuals and qualified employers to qualified 

health plans, to assist such individuals and employers in 

determining whether they are eligible to participate in 

an Exchange or eligible for a premium tax credit or costsharing reduction, and to present standardized information 

(including quality ratings) regarding qualified health plans 

offered through an Exchange to assist consumers in making 

easy health insurance choices. 

Such template shall include, with respect to each qualified 

health plan offered through the Exchange in each rating area, 

access to the uniform outline of coverage the plan is required 

to provide under section 2716 of the Public Health Service 

Act and to a copy of the plan’s written policy. 

(6) ENROLLMENT PERIODS.—The Secretary shall require an 

Exchange to provide for— 

(A) an initial open enrollment, as determined by the 

Secretary (such determination to be made not later than 

July 1, 2012); 

(B) annual open enrollment periods, as determined 

by the Secretary for calendar years after the initial enrollment period; 

(C) special enrollment periods specified in section 9801 

of the Internal Revenue Code of 1986 and other special 

enrollment periods under circumstances similar to such 

periods under part D of title XVIII of the Social Security 

Act; and 

(D) special monthly enrollment periods for Indians (as 

defined in section 4 of the Indian Health Care Improvement 

Act). 
H. R. 3590—58 

(d) REQUIREMENTS.— 

(1) IN GENERAL.—An Exchange shall be a governmental 

agency or nonprofit entity that is established by a State. 

(2) OFFERING OF COVERAGE.— 

(A) IN GENERAL.—An Exchange shall make available 

qualified health plans to qualified individuals and qualified 

employers. 

(B) LIMITATION.— 

(i) IN GENERAL.—An Exchange may not make 

available any health plan that is not a qualified health 

plan. 

(ii) OFFERING OF STAND-ALONE DENTAL BENEFITS.— 

Each Exchange within a State shall allow an issuer 

of a plan that only provides limited scope dental benefits meeting the requirements of section 9832(c)(2)(A) 

of the Internal Revenue Code of 1986 to offer the 

plan through the Exchange (either separately or in 

conjunction with a qualified health plan) if the plan 

provides pediatric dental benefits meeting the requirements of section 1302(b)(1)(J)). 

(3) RULES RELATING TO ADDITIONAL REQUIRED BENEFITS.— 

(A) IN GENERAL.—Except as provided in subparagraph 

(B), an Exchange may make available a qualified health 

plan notwithstanding any provision of law that may require 

benefits other than the essential health benefits specified 

under section 1302(b). 

(B) STATES MAY REQUIRE ADDITIONAL BENEFITS.— (i) IN GENERAL.—Subject to the requirements of 

clause (ii), a State may require that a qualified health 

plan offered in such State offer benefits in addition 

to the essential health benefits specified under section 

1302(b). 

(ii) STATE MUST ASSUME COST.—A State shall make 

payments to or on behalf of an individual eligible for 

the premium tax credit under section 36B of the 

Internal Revenue Code of 1986 and any cost-sharing 

reduction under section 1402 to defray the cost to 

the individual of any additional benefits described in 

clause (i) which are not eligible for such credit or 

reduction under section 36B(b)(3)(D) of such Code and 

section 1402(c)(4). 

(4) FUNCTIONS.—An Exchange shall, at a minimum— 

(A) implement procedures for the certification, recertification, and decertification, consistent with guidelines developed by the Secretary under subsection (c), of health plans 

as qualified health plans; 

(B) provide for the operation of a toll-free telephone 

hotline to respond to requests for assistance; 

(C) maintain an Internet website through which 

enrollees and prospective enrollees of qualified health plans 

may obtain standardized comparative information on such 

plans; 

(D) assign a rating to each qualified health plan offered 

through such Exchange in accordance with the criteria 

developed by the Secretary under subsection (c)(3); 

(E) utilize a standardized format for presenting health 

benefits plan options in the Exchange, including the use 
H. R. 3590—59 

of the uniform outline of coverage established under section 

2715 of the Public Health Service Act; 

(F) in accordance with section 1413, inform individuals 

of eligibility requirements for the medicaid program under 

title XIX of the Social Security Act, the CHIP program 

under title XXI of such Act, or any applicable State or 

local public program and if through screening of the 

application by the Exchange, the Exchange determines that 

such individuals are eligible for any such program, enroll 

such individuals in such program; 

(G) establish and make available by electronic means 

a calculator to determine the actual cost of coverage after 

the application of any premium tax credit under section 

36B of the Internal Revenue Code of 1986 and any costsharing reduction under section 1402; 

(H) subject to section 1411, grant a certification 

attesting that, for purposes of the individual responsibility 

penalty under section 5000A of the Internal Revenue Code 

of 1986, an individual is exempt from the individual 

requirement or from the penalty imposed by such section 

because— 

(i) there is no affordable qualified health plan 

available through the Exchange, or the individual’s 

employer, covering the individual; or 

(ii) the individual meets the requirements for any 

other such exemption from the individual responsibility 

requirement or penalty; 

(I) transfer to the Secretary of the Treasury— 

(i) a list of the individuals who are issued a certification under subparagraph (H), including the name 

and taxpayer identification number of each individual; 

(ii) the name and taxpayer identification number 

of each individual who was an employee of an employer 

but who was determined to be eligible for the premium 

tax credit under section 36B of the Internal Revenue 

Code of 1986 because— 

(I) the employer did not provide minimum 

essential coverage; or 

(II) the employer provided such minimum 

essential coverage but it was determined under 

section 36B(c)(2)(C) of such Code to either be 

unaffordable to the employee or not provide the 

required minimum actuarial value; and 

(iii) the name and taxpayer identification number 

of each individual who notifies the Exchange under 

section 1411(b)(4) that they have changed employers 

and of each individual who ceases coverage under a 

qualified health plan during a plan year (and the effective date of such cessation); 

(J) provide to each employer the name of each employee 

of the employer described in subparagraph (I)(ii) who ceases 

coverage under a qualified health plan during a plan year 

(and the effective date of such cessation); and 

(K) establish the Navigator program described in subsection (i). 

(5) FUNDING LIMITATIONS.— 
H. R. 3590—60 

(A) NO FEDERAL FUNDS FOR CONTINUED OPERATIONS.— 

In establishing an Exchange under this section, the State 

shall ensure that such Exchange is self-sustaining beginning on January 1, 2015, including allowing the Exchange 

to charge assessments or user fees to participating health 

insurance issuers, or to otherwise generate funding, to 

support its operations. 

(B) PROHIBITING WASTEFUL USE OF FUNDS.—In carrying 

out activities under this subsection, an Exchange shall 

not utilize any funds intended for the administrative and 

operational expenses of the Exchange for staff retreats, 

promotional giveaways, excessive executive compensation, 

or promotion of Federal or State legislative and regulatory 

modifications. 

(6) CONSULTATION.—An Exchange shall consult with stakeholders relevant to carrying out the activities under this section, 

including— 

(A) health care consumers who are enrollees in qualified health plans; 

(B) individuals and entities with experience in facilitating enrollment in qualified health plans; 

(C) representatives of small businesses and selfemployed individuals; 

(D) State Medicaid offices; and 

(E) advocates for enrolling hard to reach populations. 

(7) PUBLICATION OF COSTS.—An Exchange shall publish 

the average costs of licensing, regulatory fees, and any other 

payments required by the Exchange, and the administrative 

costs of such Exchange, on an Internet website to educate 

consumers on such costs. Such information shall also include 

monies lost to waste, fraud, and abuse. 

(e) CERTIFICATION.— 

(1) IN GENERAL.—An Exchange may certify a health plan 

as a qualified health plan if— 

(A) such health plan meets the requirements for certification as promulgated by the Secretary under subsection 

(c)(1); and 

(B) the Exchange determines that making available 

such health plan through such Exchange is in the interests 

of qualified individuals and qualified employers in the State 

or States in which such Exchange operates, except that 

the Exchange may not exclude a health plan— 

(i) on the basis that such plan is a fee-for-service 

plan; 

(ii) through the imposition of premium price controls; or 

(iii) on the basis that the plan provides treatments 

necessary to prevent patients’ deaths in circumstances 

the Exchange determines are inappropriate or too 

costly. 

(2) PREMIUM CONSIDERATIONS.—The Exchange shall require 

health plans seeking certification as qualified health plans to 

submit a justification for any premium increase prior to 

implementation of the increase. Such plans shall prominently 

post such information on their websites. The Exchange may 

take this information, and the information and the recommendations provided to the Exchange by the State under 
H. R. 3590—61 

section 2794(b)(1) of the Public Health Service Act (relating 

to patterns or practices of excessive or unjustified premium 

increases), into consideration when determining whether to 

make such health plan available through the Exchange. The 

Exchange shall take into account any excess of premium growth 

outside the Exchange as compared to the rate of such growth 

inside the Exchange, including information reported by the 

States. 

(f) FLEXIBILITY.— 

(1) REGIONAL OR OTHER INTERSTATE EXCHANGES.—An 

Exchange may operate in more than one State if— 

(A) each State in which such Exchange operates permits such operation; and 

(B) the Secretary approves such regional or interstate 

Exchange. 

(2) SUBSIDIARY EXCHANGES.—A State may establish one 

or more subsidiary Exchanges if— 

(A) each such Exchange serves a geographically distinct 

area; and 

(B) the area served by each such Exchange is at least 

as large as a rating area described in section 2701(a) of 

the Public Health Service Act. 

(3) AUTHORITY TO CONTRACT.— 

(A) IN GENERAL.—A State may elect to authorize an 

Exchange established by the State under this section to 

enter into an agreement with an eligible entity to carry 

out 1 or more responsibilities of the Exchange. 

(B) ELIGIBLE ENTITY.—In this paragraph, the term 

‘‘eligible entity’’ means— 

(i) a person— 

(I) incorporated under, and subject to the laws 

of, 1 or more States; 

(II) that has demonstrated experience on a 

State or regional basis in the individual and small 

group health insurance markets and in benefits 

coverage; and 

(III) that is not a health insurance issuer or 

that is treated under subsection (a) or (b) of section 

52 of the Internal Revenue Code of 1986 as a 

member of the same controlled group of corporations (or under common control with) as a health 

insurance issuer; or 

(ii) the State medicaid agency under title XIX of 

the Social Security Act. 

(g) REWARDING QUALITY THROUGH MARKET-BASED INCENTIVES.— 

(1) STRATEGY DESCRIBED.—A strategy described in this 

paragraph is a payment structure that provides increased 

reimbursement or other incentives for— 

(A) improving health outcomes through the 

implementation of activities that shall include quality 

reporting, effective case management, care coordination, 

chronic disease management, medication and care compliance initiatives, including through the use of the medical 

home model, for treatment or services under the plan or 

coverage; 
H. R. 3590—62 

(B) the implementation of activities to prevent hospital 

readmissions through a comprehensive program for hospital discharge that includes patient-centered education 

and counseling, comprehensive discharge planning, and 

post discharge reinforcement by an appropriate health care 

professional; 

(C) the implementation of activities to improve patient 

safety and reduce medical errors through the appropriate 

use of best clinical practices, evidence based medicine, and 

health information technology under the plan or coverage; 

and 

(D) the implementation of wellness and health promotion activities. 

(2) GUIDELINES.—The Secretary, in consultation with 

experts in health care quality and stakeholders, shall develop 

guidelines concerning the matters described in paragraph (1). 

(3) REQUIREMENTS.—The guidelines developed under paragraph (2) shall require the periodic reporting to the applicable 

Exchange of the activities that a qualified health plan has 

conducted to implement a strategy described in paragraph (1). 

(h) QUALITY IMPROVEMENT.— 

(1) ENHANCING PATIENT SAFETY.—Beginning on January 

1, 2015, a qualified health plan may contract with— 

(A) a hospital with greater than 50 beds only if such 

hospital— 

(i) utilizes a patient safety evaluation system as 

described in part C of title IX of the Public Health 

Service Act; and 

(ii) implements a mechanism to ensure that each 

patient receives a comprehensive program for hospital 

discharge that includes patient-centered education and 

counseling, comprehensive discharge planning, and 

post discharge reinforcement by an appropriate health 

care professional; or 

(B) a health care provider only if such provider implements such mechanisms to improve health care quality 

as the Secretary may by regulation require. 

(2) EXCEPTIONS.—The Secretary may establish reasonable 

exceptions to the requirements described in paragraph (1). 

(3) ADJUSTMENT.—The Secretary may by regulation adjust 

the number of beds described in paragraph (1)(A). 

(i) NAVIGATORS.— 

(1) IN GENERAL.—An Exchange shall establish a program 

under which it awards grants to entities described in paragraph 

(2) to carry out the duties described in paragraph (3). 

(2) ELIGIBILITY.— (A) IN GENERAL.—To be eligible to receive a grant 

under paragraph (1), an entity shall demonstrate to the 

Exchange involved that the entity has existing relationships, or could readily establish relationships, with 

employers and employees, consumers (including uninsured 

and underinsured consumers), or self-employed individuals 

likely to be qualified to enroll in a qualified health plan. 

(B) TYPES.—Entities described in subparagraph (A) 

may include trade, industry, and professional associations, 

commercial fishing industry organizations, ranching and 

farming organizations, community and consumer-focused 
H. R. 3590—63 

nonprofit groups, chambers of commerce, unions, small 

business development centers, other licensed insurance 

agents and brokers, and other entities that— 

(i) are capable of carrying out the duties described 

in paragraph (3); 

(ii) meet the standards described in paragraph 

(4); and 

(iii) provide information consistent with the standards developed under paragraph (5). 

(3) DUTIES.—An entity that serves as a navigator under 

a grant under this subsection shall— 

(A) conduct public education activities to raise awareness of the availability of qualified health plans; 

(B) distribute fair and impartial information concerning enrollment in qualified health plans, and the availability of premium tax credits under section 36B of the 

Internal Revenue Code of 1986 and cost-sharing reductions 

under section 1402; 

(C) facilitate enrollment in qualified health plans; 

(D) provide referrals to any applicable office of health 

insurance consumer assistance or health insurance 

ombudsman established under section 2793 of the Public 

Health Service Act, or any other appropriate State agency 

or agencies, for any enrollee with a grievance, complaint, 

or question regarding their health plan, coverage, or a 

determination under such plan or coverage; and 

(E) provide information in a manner that is culturally 

and linguistically appropriate to the needs of the population 

being served by the Exchange or Exchanges. 

(4) STANDARDS.— (A) IN GENERAL.—The Secretary shall establish standards for navigators under this subsection, including provisions to ensure that any private or public entity that is 

selected as a navigator is qualified, and licensed if appropriate, to engage in the navigator activities described in 

this subsection and to avoid conflicts of interest. Under 

such standards, a navigator shall not— 

(i) be a health insurance issuer; or 

(ii) receive any consideration directly or indirectly 

from any health insurance issuer in connection with 

the enrollment of any qualified individuals or 

employees of a qualified employer in a qualified health 

plan. 

(5) FAIR AND IMPARTIAL INFORMATION AND SERVICES.—The 

Secretary, in collaboration with States, shall develop standards 

to ensure that information made available by navigators is 

fair, accurate, and impartial. 

(6) FUNDING.—Grants under this subsection shall be made 

from the operational funds of the Exchange and not Federal 

funds received by the State to establish the Exchange. 

(j) APPLICABILITY OF MENTAL HEALTH PARITY.—Section 2726 

of the Public Health Service Act shall apply to qualified health 

plans in the same manner and to the same extent as such section 

applies to health insurance issuers and group health plans. 

(k) CONFLICT.—An Exchange may not establish rules that conflict with or prevent the application of regulations promulgated 

by the Secretary under this subtitle. 
H. R. 3590—64 

SEC. 1312. CONSUMER CHOICE. 

(a) CHOICE.— 

(1) QUALIFIED INDIVIDUALS.—A qualified individual may 

enroll in any qualified health plan available to such individual. 

(2) QUALIFIED EMPLOYERS.— 

(A) EMPLOYER MAY SPECIFY LEVEL.—A qualified 

employer may provide support for coverage of employees 

under a qualified health plan by selecting any level of 

coverage under section 1302(d) to be made available to 

employees through an Exchange. 

(B) EMPLOYEE MAY CHOOSE PLANS WITHIN A LEVEL.— 

Each employee of a qualified employer that elects a level 

of coverage under subparagraph (A) may choose to enroll 

in a qualified health plan that offers coverage at that 

level. 

(b) PAYMENT OF PREMIUMS BY QUALIFIED INDIVIDUALS.—A 

qualified individual enrolled in any qualified health plan may pay 

any applicable premium owed by such individual to the health 

insurance issuer issuing such qualified health plan. 

(c) SINGLE RISK POOL.— 

(1) INDIVIDUAL MARKET.—A health insurance issuer shall 

consider all enrollees in all health plans (other than grandfathered health plans) offered by such issuer in the individual 

market, including those enrollees who do not enroll in such 

plans through the Exchange, to be members of a single risk 

pool. 

(2) SMALL GROUP MARKET.—A health insurance issuer shall 

consider all enrollees in all health plans (other than grandfathered health plans) offered by such issuer in the small 

group market, including those enrollees who do not enroll in 

such plans through the Exchange, to be members of a single 

risk pool. 

(3) MERGER OF MARKETS.—A State may require the individual and small group insurance markets within a State to 

be merged if the State determines appropriate. 

(4) STATE LAW.—A State law requiring grandfathered 

health plans to be included in a pool described in paragraph 

(1) or (2) shall not apply. 

(d) EMPOWERING CONSUMER CHOICE.— 

(1) CONTINUED OPERATION OF MARKET OUTSIDE

EXCHANGES.—Nothing in this title shall be construed to prohibit— 

(A) a health insurance issuer from offering outside 

of an Exchange a health plan to a qualified individual 

or qualified employer; and 

(B) a qualified individual from enrolling in, or a qualified employer from selecting for its employees, a health 

plan offered outside of an Exchange. 

(2) CONTINUED OPERATION OF STATE BENEFIT REQUIREMENTS.—Nothing in this title shall be construed to terminate, 

abridge, or limit the operation of any requirement under State 

law with respect to any policy or plan that is offered outside 

of an Exchange to offer benefits. 

(3) VOLUNTARY NATURE OF AN EXCHANGE.— 

(A) CHOICE TO ENROLL OR NOT TO ENROLL.—Nothing 

in this title shall be construed to restrict the choice of 
H. R. 3590—65 

a qualified individual to enroll or not to enroll in a qualified 

health plan or to participate in an Exchange. 

(B) PROHIBITION AGAINST COMPELLED ENROLLMENT.— 

Nothing in this title shall be construed to compel an individual to enroll in a qualified health plan or to participate 

in an Exchange. 

(C) INDIVIDUALS ALLOWED TO ENROLL IN ANY PLAN.— 

A qualified individual may enroll in any qualified health 

plan, except that in the case of a catastrophic plan 

described in section 1302(e), a qualified individual may 

enroll in the plan only if the individual is eligible to enroll 

in the plan under section 1302(e)(2). 

(D) MEMBERS OF CONGRESS IN THE EXCHANGE.— 

(i) REQUIREMENT.—Notwithstanding any other 

provision of law, after the effective date of this subtitle, 

the only health plans that the Federal Government 

may make available to Members of Congress and 

congressional staff with respect to their service as a 

Member of Congress or congressional staff shall be 

health plans that are— 

(I) created under this Act (or an amendment 

made by this Act); or 

(II) offered through an Exchange established 

under this Act (or an amendment made by this 

Act). 

(ii) DEFINITIONS.—In this section: 

(I) MEMBER OF CONGRESS.—The term ‘‘Member 

of Congress’’ means any member of the House 

of Representatives or the Senate. 

(II) CONGRESSIONAL STAFF.—The term 

‘‘congressional staff’’ means all full-time and parttime employees employed by the official office of 

a Member of Congress, whether in Washington, 

DC or outside of Washington, DC. 

(4) NO PENALTY FOR TRANSFERRING TO MINIMUM ESSENTIAL

COVERAGE OUTSIDE EXCHANGE.—An Exchange, or a qualified 

health plan offered through an Exchange, shall not impose 

any penalty or other fee on an individual who cancels enrollment in a plan because the individual becomes eligible for 

minimum essential coverage (as defined in section 5000A(f) 

of the Internal Revenue Code of 1986 without regard to paragraph (1)(C) or (D) thereof) or such coverage becomes affordable 

(within the meaning of section 36B(c)(2)(C) of such Code). 

(e) ENROLLMENT THROUGH AGENTS OR BROKERS.—The Secretary shall establish procedures under which a State may allow 

agents or brokers— 

(1) to enroll individuals in any qualified health plans in 

the individual or small group market as soon as the plan 

is offered through an Exchange in the State; and 

(2) to assist individuals in applying for premium tax credits 

and cost-sharing reductions for plans sold through an Exchange. 

Such procedures may include the establishment of rate schedules 

for broker commissions paid by health benefits plans offered through 

an exchange. 

(f) QUALIFIED INDIVIDUALS AND EMPLOYERS; ACCESS LIMITED

TO CITIZENS AND LAWFUL RESIDENTS.— 

(1) QUALIFIED INDIVIDUALS.—In this title: 
H. R. 3590—66 

(A) IN GENERAL.—The term ‘‘qualified individual’’ 

means, with respect to an Exchange, an individual who— 

(i) is seeking to enroll in a qualified health plan 

in the individual market offered through the Exchange; 

and 

(ii) resides in the State that established the 

Exchange (except with respect to territorial agreements 

under section 1312(f)). 

(B) INCARCERATED INDIVIDUALS EXCLUDED.—An individual shall not be treated as a qualified individual if, 

at the time of enrollment, the individual is incarcerated, 

other than incarceration pending the disposition of charges. 

(2) QUALIFIED EMPLOYER.—In this title: 

(A) IN GENERAL.—The term ‘‘qualified employer’’ means 

a small employer that elects to make all full-time employees 

of such employer eligible for 1 or more qualified health 

plans offered in the small group market through an 

Exchange that offers qualified health plans. 

(B) EXTENSION TO LARGE GROUPS.— 

(i) IN GENERAL.—Beginning in 2017, each State 

may allow issuers of health insurance coverage in the 

large group market in the State to offer qualified health 

plans in such market through an Exchange. Nothing 

in this subparagraph shall be construed as requiring 

the issuer to offer such plans through an Exchange. 

(ii) LARGE EMPLOYERS ELIGIBLE.—If a State under 

clause (i) allows issuers to offer qualified health plans 

in the large group market through an Exchange, the 

term ‘‘qualified employer’’ shall include a large 

employer that elects to make all full-time employees 

of such employer eligible for 1 or more qualified health 

plans offered in the large group market through the 

Exchange. 

(3) ACCESS LIMITED TO LAWFUL RESIDENTS.—If an individual is not, or is not reasonably expected to be for the entire 

period for which enrollment is sought, a citizen or national 

of the United States or an alien lawfully present in the United 

States, the individual shall not be treated as a qualified individual and may not be covered under a qualified health plan 

in the individual market that is offered through an Exchange. 

SEC. 1313. FINANCIAL INTEGRITY. 

(a) ACCOUNTING FOR EXPENDITURES.— 

(1) IN GENERAL.—An Exchange shall keep an accurate 

accounting of all activities, receipts, and expenditures and shall 

annually submit to the Secretary a report concerning such 

accountings. 

(2) INVESTIGATIONS.—The Secretary, in coordination with 

the Inspector General of the Department of Health and Human 

Services, may investigate the affairs of an Exchange, may 

examine the properties and records of an Exchange, and may 

require periodic reports in relation to activities undertaken 

by an Exchange. An Exchange shall fully cooperate in any 

investigation conducted under this paragraph. 

(3) AUDITS.—An Exchange shall be subject to annual audits 

by the Secretary. 
H. R. 3590—67 

(4) PATTERN OF ABUSE.—If the Secretary determines that 

an Exchange or a State has engaged in serious misconduct 

with respect to compliance with the requirements of, or carrying 

out of activities required under, this title, the Secretary may 

rescind from payments otherwise due to such State involved 

under this or any other Act administered by the Secretary 

an amount not to exceed 1 percent of such payments per year 

until corrective actions are taken by the State that are determined to be adequate by the Secretary. 

(5) PROTECTIONS AGAINST FRAUD AND ABUSE.—With respect 

to activities carried out under this title, the Secretary shall 

provide for the efficient and non-discriminatory administration 

of Exchange activities and implement any measure or procedure 

that— 

(A) the Secretary determines is appropriate to reduce 

fraud and abuse in the administration of this title; and 

(B) the Secretary has authority to implement under 

this title or any other Act. 

(6) APPLICATION OF THE FALSE CLAIMS ACT.— 

(A) IN GENERAL.—Payments made by, through, or in 

connection with an Exchange are subject to the False 

Claims Act (31 U.S.C. 3729 et seq.) if those payments 

include any Federal funds. Compliance with the requirements of this Act concerning eligibility for a health insurance issuer to participate in the Exchange shall be a material condition of an issuer’s entitlement to receive payments, including payments of premium tax credits and 

cost-sharing reductions, through the Exchange. 

(B) DAMAGES.—Notwithstanding paragraph (1) of section 3729(a) of title 31, United States Code, and subject 

to paragraph (2) of such section, the civil penalty assessed 

under the False Claims Act on any person found liable 

under such Act as described in subparagraph (A) shall 

be increased by not less than 3 times and not more than 

6 times the amount of damages which the Government 

sustains because of the act of that person. 

(b) GAO OVERSIGHT.—Not later than 5 years after the first 

date on which Exchanges are required to be operational under 

this title, the Comptroller General shall conduct an ongoing study 

of Exchange activities and the enrollees in qualified health plans 

offered through Exchanges. Such study shall review— 

(1) the operations and administration of Exchanges, 

including surveys and reports of qualified health plans offered 

through Exchanges and on the experience of such plans 

(including data on enrollees in Exchanges and individuals purchasing health insurance coverage outside of Exchanges), the 

expenses of Exchanges, claims statistics relating to qualified 

health plans, complaints data relating to such plans, and the 

manner in which Exchanges meet their goals; 

(2) any significant observations regarding the utilization 

and adoption of Exchanges; 

(3) where appropriate, recommendations for improvements 

in the operations or policies of Exchanges; and 

(4) how many physicians, by area and specialty, are not 

taking or accepting new patients enrolled in Federal Government health care programs, and the adequacy of provider networks of Federal Government health care programs. 
H. R. 3590—68 

PART III—STATE FLEXIBILITY RELATING TO 

EXCHANGES 

SEC. 1321. STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF 

EXCHANGES AND RELATED REQUIREMENTS. 

(a) ESTABLISHMENT OF STANDARDS.— (1) IN GENERAL.—The Secretary shall, as soon as practicable after the date of enactment of this Act, issue regulations 

setting standards for meeting the requirements under this title, 

and the amendments made by this title, with respect to— 

(A) the establishment and operation of Exchanges 

(including SHOP Exchanges); 

(B) the offering of qualified health plans through such 

Exchanges; 

(C) the establishment of the reinsurance and risk 

adjustment programs under part V; and 

(D) such other requirements as the Secretary determines appropriate. 

The preceding sentence shall not apply to standards for requirements under subtitles A and C (and the amendments made 

by such subtitles) for which the Secretary issues regulations 

under the Public Health Service Act. 

(2) CONSULTATION.—In issuing the regulations under paragraph (1), the Secretary shall consult with the National Association of Insurance Commissioners and its members and with 

health insurance issuers, consumer organizations, and such 

other individuals as the Secretary selects in a manner designed 

to ensure balanced representation among interested parties. 

(b) STATE ACTION.—Each State that elects, at such time and 

in such manner as the Secretary may prescribe, to apply the requirements described in subsection (a) shall, not later than January 

1, 2014, adopt and have in effect— 

(1) the Federal standards established under subsection (a); 

or 

(2) a State law or regulation that the Secretary determines 

implements the standards within the State. 

(c) FAILURE TO ESTABLISH EXCHANGE OR IMPLEMENT REQUIREMENTS.— 

(1) IN GENERAL.—If— 

(A) a State is not an electing State under subsection 

(b); or 

(B) the Secretary determines, on or before January 

1, 2013, that an electing State— 

(i) will not have any required Exchange operational 

by January 1, 2014; or 

(ii) has not taken the actions the Secretary determines necessary to implement— 

(I) the other requirements set forth in the 

standards under subsection (a); or 

(II) the requirements set forth in subtitles A 

and C and the amendments made by such subtitles; 

the Secretary shall (directly or through agreement with a notfor-profit entity) establish and operate such Exchange within 

the State and the Secretary shall take such actions as are 

necessary to implement such other requirements. 
H. R. 3590—69 

(2) ENFORCEMENT AUTHORITY.—The provisions of section 

2736(b) of the Public Health Services Act shall apply to the 

enforcement under paragraph (1) of requirements of subsection 

(a)(1) (without regard to any limitation on the application of 

those provisions to group health plans). 

(d) NO INTERFERENCE WITH STATE REGULATORY AUTHORITY.— 

Nothing in this title shall be construed to preempt any State law 

that does not prevent the application of the provisions of this 

title. 

(e) PRESUMPTION FOR CERTAIN STATE-OPERATED EXCHANGES.— (1) IN GENERAL.—In the case of a State operating an 

Exchange before January 1, 2010, and which has insured a 

percentage of its population not less than the percentage of 

the population projected to be covered nationally after the 

implementation of this Act, that seeks to operate an Exchange 

under this section, the Secretary shall presume that such 

Exchange meets the standards under this section unless the 

Secretary determines, after completion of the process established under paragraph (2), that the Exchange does not comply 

with such standards. 

(2) PROCESS.—The Secretary shall establish a process to 

work with a State described in paragraph (1) to provide assistance necessary to assist the State’s Exchange in coming into 

compliance with the standards for approval under this section. 

SEC. 1322. FEDERAL PROGRAM TO ASSIST ESTABLISHMENT AND OPERATION OF NONPROFIT, MEMBER-RUN HEALTH INSURANCE ISSUERS. 

(a) ESTABLISHMENT OF PROGRAM.— 

(1) IN GENERAL.—The Secretary shall establish a program 

to carry out the purposes of this section to be known as the 

Consumer Operated and Oriented Plan (CO–OP) program. 

(2) PURPOSE.—It is the purpose of the CO–OP program 

to foster the creation of qualified nonprofit health insurance 

issuers to offer qualified health plans in the individual and 

small group markets in the States in which the issuers are 

licensed to offer such plans. 

(b) LOANS AND GRANTS UNDER THE CO–OP PROGRAM.— (1) IN GENERAL.—The Secretary shall provide through the 

CO–OP program for the awarding to persons applying to become 

qualified nonprofit health insurance issuers of— 

(A) loans to provide assistance to such person in 

meeting its start-up costs; and 

(B) grants to provide assistance to such person in 

meeting any solvency requirements of States in which the 

person seeks to be licensed to issue qualified health plans. 

(2) REQUIREMENTS FOR AWARDING LOANS AND GRANTS.— (A) IN GENERAL.—In awarding loans and grants under 

the CO–OP program, the Secretary shall— 

(i) take into account the recommendations of the 

advisory board established under paragraph (3); 

(ii) give priority to applicants that will offer qualified health plans on a Statewide basis, will utilize 

integrated care models, and have significant private 

support; and 

(iii) ensure that there is sufficient funding to establish at least 1 qualified nonprofit health insurance 
H. R. 3590—70 

issuer in each State, except that nothing in this clause 

shall prohibit the Secretary from funding the establishment of multiple qualified nonprofit health insurance 

issuers in any State if the funding is sufficient to 

do so. 

(B) STATES WITHOUT ISSUERS IN PROGRAM.—If no health 

insurance issuer applies to be a qualified nonprofit health 

insurance issuer within a State, the Secretary may use 

amounts appropriated under this section for the awarding 

of grants to encourage the establishment of a qualified 

nonprofit health insurance issuer within the State or the 

expansion of a qualified nonprofit health insurance issuer 

from another State to the State. 

(C) AGREEMENT.— 

(i) IN GENERAL.—The Secretary shall require any 

person receiving a loan or grant under the CO–OP 

program to enter into an agreement with the Secretary 

which requires such person to meet (and to continue 

to meet)— 

(I) any requirement under this section for such 

person to be treated as a qualified nonprofit health 

insurance issuer; and 

(II) any requirements contained in the agreement for such person to receive such loan or grant. 

(ii) RESTRICTIONS ON USE OF FEDERAL FUNDS.— The agreement shall include a requirement that no 

portion of the funds made available by any loan or 

grant under this section may be used— 

(I) for carrying on propaganda, or otherwise 

attempting, to influence legislation; or 

(II) for marketing. 

Nothing in this clause shall be construed to allow 

a person to take any action prohibited by section 

501(c)(29) of the Internal Revenue Code of 1986. 

(iii) FAILURE TO MEET REQUIREMENTS.—If the Secretary determines that a person has failed to meet 

any requirement described in clause (i) or (ii) and 

has failed to correct such failure within a reasonable 

period of time of when the person first knows (or 

reasonably should have known) of such failure, such 

person shall repay to the Secretary an amount equal 

to the sum of— 

(I) 110 percent of the aggregate amount of 

loans and grants received under this section; plus 

(II) interest on the aggregate amount of loans 

and grants received under this section for the 

period the loans or grants were outstanding. 

The Secretary shall notify the Secretary of the 

Treasury of any determination under this section of 

a failure that results in the termination of an issuer’s 

tax-exempt status under section 501(c)(29) of such 

Code. 

(D) TIME FOR AWARDING LOANS AND GRANTS.—The Secretary shall not later than July 1, 2013, award the loans 

and grants under the CO–OP program and begin the distribution of amounts awarded under such loans and grants. 

(3) ADVISORY BOARD.— 
H. R. 3590—71 

(A) IN GENERAL.—The advisory board under this paragraph shall consist of 15 members appointed by the Comptroller General of the United States from among individuals 

with qualifications described in section 1805(c)(2) of the 

Social Security Act. 

(B) RULES RELATING TO APPOINTMENTS.— 

(i) STANDARDS.—Any individual appointed under 

subparagraph (A) shall meet ethics and conflict of 

interest standards protecting against insurance 

industry involvement and interference. 

(ii) ORIGINAL APPOINTMENTS.—The original 

appointment of board members under subparagraph 

(A)(ii) shall be made no later than 3 months after 

the date of enactment of this Act. 

(C) VACANCY.—Any vacancy on the advisory board 

shall be filled in the same manner as the original appointment. 

(D) PAY AND REIMBURSEMENT.— 

(i) NO COMPENSATION FOR MEMBERS OF ADVISORY

BOARD.—Except as provided in clause (ii), a member 

of the advisory board may not receive pay, allowances, 

or benefits by reason of their service on the board. 

(ii) TRAVEL EXPENSES.—Each member shall receive 

travel expenses, including per diem in lieu of subsistence under subchapter I of chapter 57 of title 5, United 

States Code. 

(E) APPLICATION OF FACA.—The Federal Advisory Committee Act (5 U.S.C. App.) shall apply to the advisory 

board, except that section 14 of such Act shall not apply. 

(F) TERMINATION.—The advisory board shall terminate 

on the earlier of the date that it completes its duties 

under this section or December 31, 2015. 

(c) QUALIFIED NONPROFIT HEALTH INSURANCE ISSUER.—For 

purposes of this section— 

(1) IN GENERAL.—The term ‘‘qualified nonprofit health 

insurance issuer’’ means a health insurance issuer that is an 

organization— 

(A) that is organized under State law as a nonprofit, 

member corporation; 

(B) substantially all of the activities of which consist 

of the issuance of qualified health plans in the individual 

and small group markets in each State in which it is 

licensed to issue such plans; and 

(C) that meets the other requirements of this subsection. 

(2) CERTAIN ORGANIZATIONS PROHIBITED.—An organization 

shall not be treated as a qualified nonprofit health insurance 

issuer if— 

(A) the organization or a related entity (or any predecessor of either) was a health insurance issuer on July 

16, 2009; or 

(B) the organization is sponsored by a State or local 

government, any political subdivision thereof, or any 

instrumentality of such government or political subdivision. 

(3) GOVERNANCE REQUIREMENTS.—An organization shall 

not be treated as a qualified nonprofit health insurance issuer 

unless— 
H. R. 3590—72 

(A) the governance of the organization is subject to 

a majority vote of its members; 

(B) its governing documents incorporate ethics and 

conflict of interest standards protecting against insurance 

industry involvement and interference; and 

(C) as provided in regulations promulgated by the Secretary, the organization is required to operate with a strong 

consumer focus, including timeliness, responsiveness, and 

accountability to members. 

(4) PROFITS INURE TO BENEFIT OF MEMBERS.—An organization shall not be treated as a qualified nonprofit health insurance issuer unless any profits made by the organization are 

required to be used to lower premiums, to improve benefits, 

or for other programs intended to improve the quality of health 

care delivered to its members. 

(5) COMPLIANCE WITH STATE INSURANCE LAWS.—An 

organization shall not be treated as a qualified nonprofit health 

insurance issuer unless the organization meets all the requirements that other issuers of qualified health plans are required 

to meet in any State where the issuer offers a qualified health 

plan, including solvency and licensure requirements, rules on 

payments to providers, and compliance with network adequacy 

rules, rate and form filing rules, any applicable State premium 

assessments and any other State law described in section 

1324(b). 

(6) COORDINATION WITH STATE INSURANCE REFORMS.—An 

organization shall not be treated as a qualified nonprofit health 

insurance issuer unless the organization does not offer a health 

plan in a State until that State has in effect (or the Secretary 

has implemented for the State) the market reforms required 

by part A of title XXVII of the Public Health Service Act 

(as amended by subtitles A and C of this Act). 

(d) ESTABLISHMENT OF PRIVATE PURCHASING COUNCIL.— 

(1) IN GENERAL.—Qualified nonprofit health insurance 

issuers participating in the CO–OP program under this section 

may establish a private purchasing council to enter into collective purchasing arrangements for items and services that 

increase administrative and other cost efficiencies, including 

claims administration, administrative services, health information technology, and actuarial services. 

(2) COUNCIL MAY NOT SET PAYMENT RATES.—The private 

purchasing council established under paragraph (1) shall not 

set payment rates for health care facilities or providers participating in health insurance coverage provided by qualified nonprofit health insurance issuers. 

(3) CONTINUED APPLICATION OF ANTITRUST LAWS.— 

(A) IN GENERAL.—Nothing in this section shall be construed to limit the application of the antitrust laws to 

any private purchasing council (whether or not established 

under this subsection) or to any qualified nonprofit health 

insurance issuer participating in such a council. 

(B) ANTITRUST LAWS.—For purposes of this subparagraph, the term ‘‘antitrust laws’’ has the meaning given 

the term in subsection (a) of the first section of the Clayton 

Act (15 U.S.C. 12(a)). Such term also includes section 5 

of the Federal Trade Commission Act (15 U.S.C. 45) to 
H. R. 3590—73 

the extent that such section 5 applies to unfair methods 

of competition. 

(e) LIMITATION ON PARTICIPATION.—No representative of any 

Federal, State, or local government (or of any political subdivision 

or instrumentality thereof), and no representative of a person 

described in subsection (c)(2)(A), may serve on the board of directors 

of a qualified nonprofit health insurance issuer or with a private 

purchasing council established under subsection (d). 

(f) LIMITATIONS ON SECRETARY.— 

(1) IN GENERAL.—The Secretary shall not— 

(A) participate in any negotiations between 1 or more 

qualified nonprofit health insurance issuers (or a private 

purchasing council established under subsection (d)) and 

any health care facilities or providers, including any drug 

manufacturer, pharmacy, or hospital; and 

(B) establish or maintain a price structure for 

reimbursement of any health benefits covered by such 

issuers. 

(2) COMPETITION.—Nothing in this section shall be construed as authorizing the Secretary to interfere with the 

competitive nature of providing health benefits through qualified nonprofit health insurance issuers. 

(g) APPROPRIATIONS.—There are hereby appropriated, out of 

any funds in the Treasury not otherwise appropriated, 

$6,000,000,000 to carry out this section. 

(h) TAX EXEMPTION FOR QUALIFIED NONPROFIT HEALTH INSURANCE ISSUER.— 

(1) IN GENERAL.—Section 501(c) of the Internal Revenue 

Code of 1986 (relating to list of exempt organizations) is 

amended by adding at the end the following: 

‘‘(29) CO–OP HEALTH INSURANCE ISSUERS.— 

‘‘(A) IN GENERAL.—A qualified nonprofit health insurance issuer (within the meaning of section 1322 of the 

Patient Protection and Affordable Care Act) which has 

received a loan or grant under the CO–OP program under 

such section, but only with respect to periods for which 

the issuer is in compliance with the requirements of such 

section and any agreement with respect to the loan or 

grant. 

‘‘(B) CONDITIONS FOR EXEMPTION.—Subparagraph (A) 

shall apply to an organization only if— 

‘‘(i) the organization has given notice to the Secretary, in such manner as the Secretary may by regulations prescribe, that it is applying for recognition of 

its status under this paragraph, 

‘‘(ii) except as provided in section 1322(c)(4) of 

the Patient Protection and Affordable Care Act, no 

part of the net earnings of which inures to the benefit 

of any private shareholder or individual, 

‘‘(iii) no substantial part of the activities of which 

is carrying on propaganda, or otherwise attempting, 

to influence legislation, and 

‘‘(iv) the organization does not participate in, or 

intervene in (including the publishing or distributing 

of statements), any political campaign on behalf of 

(or in opposition to) any candidate for public office.’’. 
H. R. 3590—74 

(2) ADDITIONAL REPORTING REQUIREMENT.—Section 6033 of 

such Code (relating to returns by exempt organizations) is 

amended by redesignating subsection (m) as subsection (n) 

and by inserting after subsection (l) the following: 

‘‘(m) ADDITIONAL INFORMATION REQUIRED FROM CO–OP 

INSURERS.—An organization described in section 501(c)(29) shall 

include on the return required under subsection (a) the following 

information: 

‘‘(1) The amount of the reserves required by each State 

in which the organization is licensed to issue qualified health 

plans. 

‘‘(2) The amount of reserves on hand.’’. 

(3) APPLICATION OF TAX ON EXCESS BENEFIT TRANSACTIONS.—Section 4958(e)(1) of such Code (defining applicable 

tax-exempt organization) is amended by striking ‘‘paragraph 

(3) or (4)’’ and inserting ‘‘paragraph (3), (4), or (29)’’. 

(i) GAO STUDY AND REPORT.— 

(1) STUDY.—The Comptroller General of the General 

Accountability Office shall conduct an ongoing study on competition and market concentration in the health insurance 

market in the United States after the implementation of the 

reforms in such market under the provisions of, and the amendments made by, this Act. Such study shall include an analysis 

of new issuers of health insurance in such market. 

(2) REPORT.—The Comptroller General shall, not later than 

December 31 of each even-numbered year (beginning with 

2014), report to the appropriate committees of the Congress 

the results of the study conducted under paragraph (1), 

including any recommendations for administrative or legislative 

changes the Comptroller General determines necessary or 

appropriate to increase competition in the health insurance 

market. 

SEC. 1323. COMMUNITY HEALTH INSURANCE OPTION. 

(a) VOLUNTARY NATURE.— (1) NO REQUIREMENT FOR HEALTH CARE PROVIDERS TO

PARTICIPATE.—Nothing in this section shall be construed to 

require a health care provider to participate in a community 

health insurance option, or to impose any penalty for nonparticipation. 

(2) NO REQUIREMENT FOR INDIVIDUALS TO JOIN.—Nothing 

in this section shall be construed to require an individual 

to participate in a community health insurance option, or to 

impose any penalty for non-participation. 

(3) STATE OPT OUT.— 

(A) IN GENERAL.—A State may elect to prohibit 

Exchanges in such State from offering a community health 

insurance option if such State enacts a law to provide 

for such prohibition. 

(B) TERMINATION OF OPT OUT.—A State may repeal 

a law described in subparagraph (A) and provide for the 

offering of such an option through the Exchange. 

(b) ESTABLISHMENT OF COMMUNITY HEALTH INSURANCE

OPTION.— 

(1) ESTABLISHMENT.—The Secretary shall establish a 

community health insurance option to offer, through the 

Exchanges established under this title (other than Exchanges 
H. R. 3590—75 

in States that elect to opt out as provided for in subsection 

(a)(3)), health care coverage that provides value, choice, competition, and stability of affordable, high quality coverage 

throughout the United States. 

(2) COMMUNITY HEALTH INSURANCE OPTION.—In this section, the term ‘‘community health insurance option’’ means 

health insurance coverage that— 

(A) except as specifically provided for in this section, 

complies with the requirements for being a qualified health 

plan; 

(B) provides high value for the premium charged; 

(C) reduces administrative costs and promotes administrative simplification for beneficiaries; 

(D) promotes high quality clinical care; 

(E) provides high quality customer service to beneficiaries; 

(F) offers a sufficient choice of providers; and 

(G) complies with State laws (if any), except as otherwise provided for in this title, relating to the laws described 

in section 1324(b). 

(3) ESSENTIAL HEALTH BENEFITS.— 

(A) GENERAL RULE.—Except as provided in subparagraph (B), a community health insurance option offered 

under this section shall provide coverage only for the essential health benefits described in section 1302(b). 

(B) STATES MAY OFFER ADDITIONAL BENEFITS.—Nothing 

in this section shall preclude a State from requiring that 

benefits in addition to the essential health benefits required 

under subparagraph (A) be provided to enrollees of a 

community health insurance option offered in such State. 

(C) CREDITS.— (i) IN GENERAL.—An individual enrolled in a 

community health insurance option under this section 

shall be eligible for credits under section 36B of the 

Internal Revenue Code of 1986 in the same manner 

as an individual who is enrolled in a qualified health 

plan. 

(ii) NO ADDITIONAL FEDERAL COST.—A requirement 

by a State under subparagraph (B) that benefits in 

addition to the essential health benefits required under 

subparagraph (A) be provided to enrollees of a community health insurance option shall not affect the 

amount of a premium tax credit provided under section 

36B of the Internal Revenue Code of 1986 with respect 

to such plan. 

(D) STATE MUST ASSUME COST.—A State shall make 

payments to or on behalf of an eligible individual to defray 

the cost of any additional benefits described in subparagraph (B). 

(E) ENSURING ACCESS TO ALL SERVICES.—Nothing in 

this Act shall prohibit an individual enrolled in a community health insurance option from paying out-of-pocket the 

full cost of any item or service not included as an essential 

health benefit or otherwise covered as a benefit by a health 

plan. Nothing in subparagraph (B) shall prohibit any type 

of medical provider from accepting an out-of-pocket payment from an individual enrolled in a community health 
H. R. 3590—76 

insurance option for a service otherwise not included as 

an essential health benefit. 

(F) PROTECTING ACCESS TO END OF LIFE CARE.—A 

community health insurance option offered under this section shall be prohibited from limiting access to end of 

life care. 

(4) COST SHARING.—A community health insurance option 

shall offer coverage at each of the levels of coverage described 

in section 1302(d). 

(5) PREMIUMS.— 

(A) PREMIUMS SUFFICIENT TO COVER COSTS.—The Secretary shall establish geographically adjusted premium 

rates in an amount sufficient to cover expected costs 

(including claims and administrative costs) using methods 

in general use by qualified health plans. 

(B) APPLICABLE RULES.—The provisions of title XXVII 

of the Public Health Service Act relating to premiums 

shall apply to community health insurance options under 

this section, including modified community rating provisions under section 2701 of such Act. 

(C) COLLECTION OF DATA.—The Secretary shall collect 

data as necessary to set premium rates under subparagraph (A). 

(D) NATIONAL POOLING.—Notwithstanding any other 

provision of law, the Secretary may treat all enrollees 

in community health insurance options as members of a 

single pool. 

(E) CONTINGENCY MARGIN.—In establishing premium 

rates under subparagraph (A), the Secretary shall include 

an appropriate amount for a contingency margin. 

(6) REIMBURSEMENT RATES.— 

(A) NEGOTIATED RATES.—The Secretary shall negotiate 

rates for the reimbursement of health care providers for 

benefits covered under a community health insurance 

option. 

(B) LIMITATION.—The rates described in subparagraph 

(A) shall not be higher, in aggregate, than the average 

reimbursement rates paid by health insurance issuers 

offering qualified health plans through the Exchange. 

(C) INNOVATION.—Subject to the limits contained in 

subparagraph (A), a State Advisory Council established 

or designated under subsection (d) may develop or encourage the use of innovative payment policies that promote 

quality, efficiency and savings to consumers. 

(7) SOLVENCY AND CONSUMER PROTECTION.— 

(A) SOLVENCY.—The Secretary shall establish a Federal solvency standard to be applied with respect to a 

community health insurance option. A community health 

insurance option shall also be subject to the solvency 

standard of each State in which such community health 

insurance option is offered. 

(B) MINIMUM REQUIRED.—In establishing the standard 

described under subparagraph (A), the Secretary shall 

require a reserve fund that shall be equal to at least 

the dollar value of the incurred but not reported claims 

of a community health insurance option. 
H. R. 3590—77 

(C) CONSUMER PROTECTIONS.—The consumer protection 

laws of a State shall apply to a community health insurance 

option. 

(8) REQUIREMENTS ESTABLISHED IN PARTNERSHIP WITH

INSURANCE COMMISSIONERS.— 

(A) IN GENERAL.—The Secretary, in collaboration with 

the National Association of Insurance Commissioners (in 

this paragraph referred to as the ‘‘NAIC’’), may promulgate 

regulations to establish additional requirements for a 

community health insurance option. 

(B) APPLICABILITY.—Any requirement promulgated 

under subparagraph (A) shall be applicable to such option 

beginning 90 days after the date on which the regulation 

involved becomes final. 

(c) START-UP FUND.— 

(1) ESTABLISHMENT OF FUND.— 

(A) IN GENERAL.—There is established in the Treasury 

of the United States a trust fund to be known as the 

‘‘Health Benefit Plan Start-Up Fund’’ (referred to in this 

section as the ‘‘Start-Up Fund’’), that shall consist of such 

amounts as may be appropriated or credited to the StartUp Fund as provided for in this subsection to provide 

loans for the initial operations of a community health insurance option. Such amounts shall remain available until 

expended. 

(B) FUNDING.—There is hereby appropriated to the 

Start-Up Fund, out of any moneys in the Treasury not 

otherwise appropriated an amount requested by the Secretary of Health and Human Services as necessary to— 

(i) pay the start-up costs associated with the initial 

operations of a community health insurance option; 

and 

(ii) pay the costs of making payments on claims 

submitted during the period that is not more than 

90 days from the date on which such option is offered. 

(2) USE OF START-UP FUND.—The Secretary shall use 

amounts contained in the Start-Up Fund to make payments 

(subject to the repayment requirements in paragraph (4)) for 

the purposes described in paragraph (1)(B). 

(3) PASS THROUGH OF REBATES.—The Secretary may establish procedures for reducing the amount of payments to a 

contracting administrator to take into account any rebates or 

price concessions. 

(4) REPAYMENT.— 

(A) IN GENERAL.—A community health insurance 

option shall be required to repay the Secretary of the 

Treasury (on such terms as the Secretary may require) 

for any payments made under paragraph (1)(B) by the 

date that is not later than 9 years after the date on which 

the payment is made. The Secretary may require the payment of interest with respect to such repayments at rates 

that do not exceed the market interest rate (as determined 

by the Secretary). 

(B) SANCTIONS IN CASE OF FOR-PROFIT CONVERSION.— In any case in which the Secretary enters into a contract 

with a qualified entity for the offering of a community 

health insurance option and such entity is determined to 
H. R. 3590—78 

be a for-profit entity by the Secretary, such entity shall 

be— 

(i) immediately liable to the Secretary for any payments received by such entity from the Start-Up Fund; 

and 

(ii) permanently ineligible to offer a qualified 

health plan. 

(d) STATE ADVISORY COUNCIL.— 

(1) ESTABLISHMENT.—A State (other than a State that 

elects to opt out as provided for in subsection (a)(3)) shall 

establish or designate a public or non-profit private entity 

to serve as the State Advisory Council to provide recommendations to the Secretary on the operations and policies of a 

community health insurance option in the State. Such Council 

shall provide recommendations on at least the following: 

(A) policies and procedures to integrate quality 

improvement and cost containment mechanisms into the 

health care delivery system; 

(B) mechanisms to facilitate public awareness of the 

availability of a community health insurance option; and 

(C) alternative payment structures under a community 

health insurance option for health care providers that 

encourage quality improvement and cost control. 

(2) MEMBERS.—The members of the State Advisory Council 

shall be representatives of the public and shall include health 

care consumers and providers. 

(3) APPLICABILITY OF RECOMMENDATIONS.—The Secretary 

may apply the recommendations of a State Advisory Council 

to a community health insurance option in that State, in any 

other State, or in all States. 

(e) AUTHORITY TO CONTRACT; TERMS OF CONTRACT.— (1) AUTHORITY.— 

(A) IN GENERAL.—The Secretary may enter into a contract or contracts with one or more qualified entities for 

the purpose of performing administrative functions 

(including functions described in subsection (a)(4) of section 

1874A of the Social Security Act) with respect to a community health insurance option in the same manner as the 

Secretary may enter into contracts under subsection (a)(1) 

of such section. The Secretary shall have the same 

authority with respect to a community health insurance 

option under this section as the Secretary has under subsections (a)(1) and (b) of section 1874A of the Social Security 

Act with respect to title XVIII of such Act. 

(B) REQUIREMENTS APPLY.—If the Secretary enters into 

a contract with a qualified entity to offer a community 

health insurance option, under such contract such entity— 

(i) shall meet the criteria established under paragraph (2); and 

(ii) shall receive an administrative fee under paragraph (7). 

(C) LIMITATION.—Contracts under this subsection shall 

not involve the transfer of insurance risk to the contracting 

administrator. 

(D) REFERENCE.—An entity with which the Secretary 

has entered into a contract under this paragraph shall 

be referred to as a ‘‘contracting administrator’’. 
H. R. 3590—79 

(2) QUALIFIED ENTITY.—To be qualified to be selected by 

the Secretary to offer a community health insurance option, 

an entity shall— 

(A) meet the criteria established under section 

1874A(a)(2) of the Social Security Act; 

(B) be a nonprofit entity for purposes of offering such 

option; 

(C) meet the solvency standards applicable under subsection (b)(7); 

(D) be eligible to offer health insurance or health benefits coverage; 

(E) meet quality standards specified by the Secretary; 

(F) have in place effective procedures to control fraud, 

abuse, and waste; and 

(G) meet such other requirements as the Secretary 

may impose. 

Procedures described under subparagraph (F) shall include the 

implementation of procedures to use beneficiary identifiers to 

identify individuals entitled to benefits so that such an individual’s social security account number is not used, and shall 

also include procedures for the use of technology (including 

front-end, prepayment intelligent data-matching technology 

similar to that used by hedge funds, investment funds, and 

banks) to provide real-time data analysis of claims for payment 

under this title to identify and investigate unusual billing or 

order practices under this title that could indicate fraud or 

abuse. 

(3) TERM.—A contract provided for under paragraph (1) 

shall be for a term of at least 5 years but not more than 

10 years, as determined by the Secretary. At the end of each 

such term, the Secretary shall conduct a competitive bidding 

process for the purposes of renewing existing contracts or 

selecting new qualified entities with which to enter into contracts under such paragraph. 

(4) LIMITATION.—A contract may not be renewed under 

this subsection unless the Secretary determines that the contracting administrator has met performance requirements 

established by the Secretary in the areas described in paragraph (7)(B). 

(5) AUDITS.—The Inspector General shall conduct periodic 

audits with respect to contracting administrators under this 

subsection to ensure that the administrator involved is in 

compliance with this section. 

(6) REVOCATION.—A contract awarded under this subsection 

shall be revoked by the Secretary, upon the recommendation 

of the Inspector General, only after notice to the contracting 

administrator involved and an opportunity for a hearing. The 

Secretary may revoke such contract if the Secretary determines 

that such administrator has engaged in fraud, deception, waste, 

abuse of power, negligence, mismanagement of taxpayer dollars, 

or gross mismanagement. An entity that has had a contract 

revoked under this paragraph shall not be qualified to enter 

into a subsequent contract under this subsection. 

(7) FEE FOR ADMINISTRATION.— (A) IN GENERAL.—The Secretary shall pay the contracting administrator a fee for the management, administration, and delivery of the benefits under this section. 
H. R. 3590—80 

(B) REQUIREMENT FOR HIGH QUALITY ADMINISTRATION.—The Secretary may increase the fee described in 

subparagraph (A) by not more than 10 percent, or reduce 

the fee described in subparagraph (A) by not more than 

50 percent, based on the extent to which the contracting 

administrator, in the determination of the Secretary, meets 

performance requirements established by the Secretary, 

in at least the following areas: 

(i) Maintaining low premium costs and low cost 

sharing requirements, provided that such requirements 

are consistent with section 1302. 

(ii) Reducing administrative costs and promoting 

administrative simplification for beneficiaries. 

(iii) Promoting high quality clinical care. 

(iv) Providing high quality customer service to 

beneficiaries. 

(C) NON-RENEWAL.—The Secretary may not renew a 

contract to offer a community health insurance option 

under this section with any contracting entity that has 

been assessed more than one reduction under subparagraph 

(B) during the contract period. 

(8) LIMITATION.—Notwithstanding the terms of a contract 

under this subsection, the Secretary shall negotiate the 

reimbursement rates for purposes of subsection (b)(6). 

(f) REPORT BY HHS AND INSOLVENCY WARNINGS.— 

(1) IN GENERAL.—On an annual basis, the Secretary shall 

conduct a study on the solvency of a community health insurance option and submit to Congress a report describing the 

results of such study. 

(2) RESULT.—If, in any year, the result of the study under 

paragraph (1) is that a community health insurance option 

is insolvent, such result shall be treated as a community health 

insurance option solvency warning. 

(3) SUBMISSION OF PLAN AND PROCEDURE.— 

(A) IN GENERAL.—If there is a community health insurance option solvency warning under paragraph (2) made 

in a year, the President shall submit to Congress, within 

the 15-day period beginning on the date of the budget 

submission to Congress under section 1105(a) of title 31, 

United States Code, for the succeeding year, proposed legislation to respond to such warning. 

(B) PROCEDURE.—In the case of a legislative proposal 

submitted by the President pursuant to subparagraph (A), 

such proposal shall be considered by Congress using the 

same procedures described under sections 803 and 804 

of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 that shall be used for a medicare 

funding warning. 

(g) MARKETING PARITY.—In a facility controlled by the Federal 

Government, or by a State, where marketing or promotional materials related to a community health insurance option are made 

available to the public, making available marketing or promotional 

materials relating to private health insurance plans shall not be 

prohibited. Such materials include informational pamphlets, guidebooks, enrollment forms, or other materials determined reasonable 

for display. 
H. R. 3590—81 

(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated such sums as may be necessary to carry out 

this section. 

SEC. 1324. LEVEL PLAYING FIELD. 

(a) IN GENERAL.—Notwithstanding any other provision of law, 

any health insurance coverage offered by a private health insurance 

issuer shall not be subject to any Federal or State law described 

in subsection (b) if a qualified health plan offered under the Consumer Operated and Oriented Plan program under section 1322, 

a community health insurance option under section 1323, or a 

nationwide qualified health plan under section 1333(b), is not subject to such law. 

(b) LAWS DESCRIBED.—The Federal and State laws described 

in this subsection are those Federal and State laws relating to— 

(1) guaranteed renewal; 

(2) rating; 

(3) preexisting conditions; 

(4) non-discrimination; 

(5) quality improvement and reporting; 

(6) fraud and abuse; 

(7) solvency and financial requirements; 

(8) market conduct; 

(9) prompt payment; 

(10) appeals and grievances; 

(11) privacy and confidentiality; 

(12) licensure; and 

(13) benefit plan material or information. 

PART IV—STATE FLEXIBILITY TO ESTABLISH 

ALTERNATIVE PROGRAMS 

SEC. 1331. STATE FLEXIBILITY TO ESTABLISH BASIC HEALTH PROGRAMS FOR LOW-INCOME INDIVIDUALS NOT ELIGIBLE 

FOR MEDICAID. 

(a) ESTABLISHMENT OF PROGRAM.— (1) IN GENERAL.—The Secretary shall establish a basic 

health program meeting the requirements of this section under 

which a State may enter into contracts to offer 1 or more 

standard health plans providing at least the essential health 

benefits described in section 1302(b) to eligible individuals in 

lieu of offering such individuals coverage through an Exchange. 

(2) CERTIFICATIONS AS TO BENEFIT COVERAGE AND COSTS.— 

Such program shall provide that a State may not establish 

a basic health program under this section unless the State 

establishes to the satisfaction of the Secretary, and the Secretary certifies, that— 

(A) in the case of an eligible individual enrolled in 

a standard health plan offered through the program, the 

State provides— 

(i) that the amount of the monthly premium an 

eligible individual is required to pay for coverage under 

the standard health plan for the individual and the 

individual’s dependents does not exceed the amount 

of the monthly premium that the eligible individual 

would have been required to pay (in the rating area 

in which the individual resides) if the individual had 
H. R. 3590—82 

enrolled in the applicable second lowest cost silver 

plan (as defined in section 36B(b)(3)(B) of the Internal 

Revenue Code of 1986) offered to the individual 

through an Exchange; and 

(ii) that the cost-sharing an eligible individual is 

required to pay under the standard health plan does 

not exceed— 

(I) the cost-sharing required under a platinum 

plan in the case of an eligible individual with 

household income not in excess of 150 percent 

of the poverty line for the size of the family 

involved; and 

(II) the cost-sharing required under a gold plan 

in the case of an eligible individual not described 

in subclause (I); and 

(B) the benefits provided under the standard health 

plans offered through the program cover at least the essential health benefits described in section 1302(b). 

For purposes of subparagraph (A)(i), the amount of the monthly 

premium an individual is required to pay under either the 

standard health plan or the applicable second lowest cost silver 

plan shall be determined after reduction for any premium tax 

credits and cost-sharing reductions allowable with respect to 

either plan. 

(b) STANDARD HEALTH PLAN.—In this section, the term 

‘‘standard heath plan’’ means a health benefits plan that the State 

contracts with under this section— 

(1) under which the only individuals eligible to enroll are 

eligible individuals; 

(2) that provides at least the essential health benefits 

described in section 1302(b); and 

(3) in the case of a plan that provides health insurance 

coverage offered by a health insurance issuer, that has a medical loss ratio of at least 85 percent. 

(c) CONTRACTING PROCESS.— 

(1) IN GENERAL.—A State basic health program shall establish a competitive process for entering into contracts with 

standard health plans under subsection (a), including negotiation of premiums and cost-sharing and negotiation of benefits 

in addition to the essential health benefits described in section 

1302(b). 

(2) SPECIFIC ITEMS TO BE CONSIDERED.—A State shall, as 

part of its competitive process under paragraph (1), include 

at least the following: 

(A) INNOVATION.—Negotiation with offerors of a 

standard health plan for the inclusion of innovative features in the plan, including— 

(i) care coordination and care management for 

enrollees, especially for those with chronic health 

conditions; 

(ii) incentives for use of preventive services; and 

(iii) the establishment of relationships between 

providers and patients that maximize patient involvement in health care decision-making, including providing incentives for appropriate utilization under the 

plan. 
H. R. 3590—83 

(B) HEALTH AND RESOURCE DIFFERENCES.—Consideration of, and the making of suitable allowances for, differences in health care needs of enrollees and differences 

in local availability of, and access to, health care providers. 

Nothing in this subparagraph shall be construed as 

allowing discrimination on the basis of pre-existing conditions or other health status-related factors. 

(C) MANAGED CARE.—Contracting with managed care 

systems, or with systems that offer as many of the 

attributes of managed care as are feasible in the local 

health care market. 

(D) PERFORMANCE MEASURES.—Establishing specific 

performance measures and standards for issuers of 

standard health plans that focus on quality of care and 

improved health outcomes, requiring such plans to report 

to the State with respect to the measures and standards, 

and making the performance and quality information available to enrollees in a useful form. 

(3) ENHANCED AVAILABILITY.— 

(A) MULTIPLE PLANS.—A State shall, to the maximum 

extent feasible, seek to make multiple standard health 

plans available to eligible individuals within a State to 

ensure individuals have a choice of such plans. 

(B) REGIONAL COMPACTS.—A State may negotiate a 

regional compact with other States to include coverage 

of eligible individuals in all such States in agreements 

with issuers of standard health plans. 

(4) COORDINATION WITH OTHER STATE PROGRAMS.—A State 

shall seek to coordinate the administration of, and provision 

of benefits under, its program under this section with the 

State medicaid program under title XIX of the Social Security 

Act, the State child health plan under title XXI of such Act, 

and other State-administered health programs to maximize 

the efficiency of such programs and to improve the continuity 

of care. 

(d) TRANSFER OF FUNDS TO STATES.— (1) IN GENERAL.—If the Secretary determines that a State 

electing the application of this section meets the requirements 

of the program established under subsection (a), the Secretary 

shall transfer to the State for each fiscal year for which 1 

or more standard health plans are operating within the State 

the amount determined under paragraph (3). 

(2) USE OF FUNDS.—A State shall establish a trust for 

the deposit of the amounts received under paragraph (1) and 

amounts in the trust fund shall only be used to reduce the 

premiums and cost-sharing of, or to provide additional benefits 

for, eligible individuals enrolled in standard health plans within 

the State. Amounts in the trust fund, and expenditures of 

such amounts, shall not be included in determining the amount 

of any non-Federal funds for purposes of meeting any matching 

or expenditure requirement of any federally-funded program. 

(3) AMOUNT OF PAYMENT.— (A) SECRETARIAL DETERMINATION.— 

(i) IN GENERAL.—The amount determined under 

this paragraph for any fiscal year is the amount the 

Secretary determines is equal to 85 percent of the 

premium tax credits under section 36B of the Internal 
H. R. 3590—84 

Revenue Code of 1986, and the cost-sharing reductions 

under section 1402, that would have been provided 

for the fiscal year to eligible individuals enrolled in 

standard health plans in the State if such eligible 

individuals were allowed to enroll in qualified health 

plans through an Exchange established under this subtitle. 

(ii) SPECIFIC REQUIREMENTS.—The Secretary shall 

make the determination under clause (i) on a per 

enrollee basis and shall take into account all relevant 

factors necessary to determine the value of the premium tax credits and cost-sharing reductions that 

would have been provided to eligible individuals 

described in clause (i), including the age and income 

of the enrollee, whether the enrollment is for selfonly or family coverage, geographic differences in average spending for health care across rating areas, the 

health status of the enrollee for purposes of determining risk adjustment payments and reinsurance payments that would have been made if the enrollee had 

enrolled in a qualified health plan through an 

Exchange, and whether any reconciliation of the credit 

or cost-sharing reductions would have occurred if the 

enrollee had been so enrolled. This determination shall 

take into consideration the experience of other States 

with respect to participation in an Exchange and such 

credits and reductions provided to residents of the 

other States, with a special focus on enrollees with 

income below 200 percent of poverty. 

(iii) CERTIFICATION.—The Chief Actuary of the 

Centers for Medicare & Medicaid Services, in consultation with the Office of Tax Analysis of the Department 

of the Treasury, shall certify whether the methodology 

used to make determinations under this subparagraph, 

and such determinations, meet the requirements of 

clause (ii). Such certifications shall be based on sufficient data from the State and from comparable States 

about their experience with programs created by this 

Act. 

(B) CORRECTIONS.—The Secretary shall adjust the payment for any fiscal year to reflect any error in the determinations under subparagraph (A) for any preceding fiscal 

year. 

(4) APPLICATION OF SPECIAL RULES.—The provisions of section 1303 shall apply to a State basic health program, and 

to standard health plans offered through such program, in 

the same manner as such rules apply to qualified health plans. 

(e) ELIGIBLE INDIVIDUAL.— 

(1) IN GENERAL.—In this section, the term ‘‘eligible individual’’ means, with respect to any State, an individual— 

(A) who a resident of the State who is not eligible 

to enroll in the State’s medicaid program under title XIX 

of the Social Security Act for benefits that at a minimum 

consist of the essential health benefits described in section 

1302(b); 
H. R. 3590—85 

(B) whose household income exceeds 133 percent but 

does not exceed 200 percent of the poverty line for the 

size of the family involved; 

(C) who is not eligible for minimum essential coverage 

(as defined in section 5000A(f) of the Internal Revenue 

Code of 1986) or is eligible for an employer-sponsored plan 

that is not affordable coverage (as determined under section 

5000A(e)(2) of such Code); and 

(D) who has not attained age 65 as of the beginning 

of the plan year. 

Such term shall not include any individual who is not a qualified individual under section 1312 who is eligible to be covered 

by a qualified health plan offered through an Exchange. 

(2) ELIGIBLE INDIVIDUALS MAY NOT USE EXCHANGE.—An 

eligible individual shall not be treated as a qualified individual 

under section 1312 eligible for enrollment in a qualified health 

plan offered through an Exchange established under section 

1311. 

(f) SECRETARIAL OVERSIGHT.—The Secretary shall each year 

conduct a review of each State program to ensure compliance with 

the requirements of this section, including ensuring that the State 

program meets— 

(1) eligibility verification requirements for participation in 

the program; 

(2) the requirements for use of Federal funds received 

by the program; and 

(3) the quality and performance standards under this section. 

(g) STANDARD HEALTH PLAN OFFERORS.—A State may provide 

that persons eligible to offer standard health plans under a basic 

health program established under this section may include a 

licensed health maintenance organization, a licensed health insurance insurer, or a network of health care providers established 

to offer services under the program. 

(h) DEFINITIONS.—Any term used in this section which is also 

used in section 36B of the Internal Revenue Code of 1986 shall 

have the meaning given such term by such section. 

SEC. 1332. WAIVER FOR STATE INNOVATION. 

(a) APPLICATION.— 

(1) IN GENERAL.—A State may apply to the Secretary for 

the waiver of all or any requirements described in paragraph 

(2) with respect to health insurance coverage within that State 

for plan years beginning on or after January 1, 2017. Such 

application shall— 

(A) be filed at such time and in such manner as the 

Secretary may require; 

(B) contain such information as the Secretary may 

require, including— 

(i) a comprehensive description of the State legislation and program to implement a plan meeting the 

requirements for a waiver under this section; and 

(ii) a 10-year budget plan for such plan that is 

budget neutral for the Federal Government; and 

(C) provide an assurance that the State has enacted 

the law described in subsection (b)(2). 
H. R. 3590—86 

(2) REQUIREMENTS.—The requirements described in this 

paragraph with respect to health insurance coverage within 

the State for plan years beginning on or after January 1, 

2014, are as follows: 

(A) Part I of subtitle D. 

(B) Part II of subtitle D. 

(C) Section 1402. 

(D) Sections 36B, 4980H, and 5000A of the Internal 

Revenue Code of 1986. 

(3) PASS THROUGH OF FUNDING.—With respect to a State 

waiver under paragraph (1), under which, due to the structure 

of the State plan, individuals and small employers in the State 

would not qualify for the premium tax credits, cost-sharing 

reductions, or small business credits under sections 36B of 

the Internal Revenue Code of 1986 or under part I of subtitle 

E for which they would otherwise be eligible, the Secretary 

shall provide for an alternative means by which the aggregate 

amount of such credits or reductions that would have been 

paid on behalf of participants in the Exchanges established 

under this title had the State not received such waiver, shall 

be paid to the State for purposes of implementing the State 

plan under the waiver. Such amount shall be determined 

annually by the Secretary, taking into consideration the experience of other States with respect to participation in an 

Exchange and credits and reductions provided under such provisions to residents of the other States. 

(4) WAIVER CONSIDERATION AND TRANSPARENCY.— (A) IN GENERAL.—An application for a waiver under 

this section shall be considered by the Secretary in accordance with the regulations described in subparagraph (B). 

(B) REGULATIONS.—Not later than 180 days after the 

date of enactment of this Act, the Secretary shall promulgate regulations relating to waivers under this section that 

provide— 

(i) a process for public notice and comment at 

the State level, including public hearings, sufficient 

to ensure a meaningful level of public input; 

(ii) a process for the submission of an application 

that ensures the disclosure of— 

(I) the provisions of law that the State involved 

seeks to waive; and 

(II) the specific plans of the State to ensure 

that the waiver will be in compliance with subsection (b); 

(iii) a process for providing public notice and comment after the application is received by the Secretary, 

that is sufficient to ensure a meaningful level of public 

input and that does not impose requirements that are 

in addition to, or duplicative of, requirements imposed 

under the Administrative Procedures Act, or requirements that are unreasonable or unnecessarily burdensome with respect to State compliance; 

(iv) a process for the submission to the Secretary 

of periodic reports by the State concerning the 

implementation of the program under the waiver; and 

(v) a process for the periodic evaluation by the 

Secretary of the program under the waiver. 
H. R. 3590—87 

(C) REPORT.—The Secretary shall annually report to 

Congress concerning actions taken by the Secretary with 

respect to applications for waivers under this section. 

(5) COORDINATED WAIVER PROCESS.—The Secretary shall 

develop a process for coordinating and consolidating the State 

waiver processes applicable under the provisions of this section, 

and the existing waiver processes applicable under titles XVIII, 

XIX, and XXI of the Social Security Act, and any other Federal 

law relating to the provision of health care items or services. 

Such process shall permit a State to submit a single application 

for a waiver under any or all of such provisions. 

(6) DEFINITION.—In this section, the term ‘‘Secretary’’ 

means— 

(A) the Secretary of Health and Human Services with 

respect to waivers relating to the provisions described in 

subparagraph (A) through (C) of paragraph (2); and 

(B) the Secretary of the Treasury with respect to 

waivers relating to the provisions described in paragraph 

(2)(D). 

(b) GRANTING OF WAIVERS.— 

(1) IN GENERAL.—The Secretary may grant a request for 

a waiver under subsection (a)(1) only if the Secretary determines that the State plan— 

(A) will provide coverage that is at least as comprehensive as the coverage defined in section 1302(b) and offered 

through Exchanges established under this title as certified 

by Office of the Actuary of the Centers for Medicare & 

Medicaid Services based on sufficient data from the State 

and from comparable States about their experience with 

programs created by this Act and the provisions of this 

Act that would be waived; 

(B) will provide coverage and cost sharing protections 

against excessive out-of-pocket spending that are at least 

as affordable as the provisions of this title would provide; 

(C) will provide coverage to at least a comparable 

number of its residents as the provisions of this title would 

provide; and 

(D) will not increase the Federal deficit. 

(2) REQUIREMENT TO ENACT A LAW.— 

(A) IN GENERAL.—A law described in this paragraph 

is a State law that provides for State actions under a 

waiver under this section, including the implementation 

of the State plan under subsection (a)(1)(B). 

(B) TERMINATION OF OPT OUT.—A State may repeal 

a law described in subparagraph (A) and terminate the 

authority provided under the waiver with respect to the 

State. 

(c) SCOPE OF WAIVER.— (1) IN GENERAL.—The Secretary shall determine the scope 

of a waiver of a requirement described in subsection (a)(2) 

granted to a State under subsection (a)(1). 

(2) LIMITATION.—The Secretary may not waive under this 

section any Federal law or requirement that is not within 

the authority of the Secretary. 

(d) DETERMINATIONS BY SECRETARY.— (1) TIME FOR DETERMINATION.—The Secretary shall make 

a determination under subsection (a)(1) not later than 180 
H. R. 3590—88 

days after the receipt of an application from a State under 

such subsection. 

(2) EFFECT OF DETERMINATION.— 

(A) GRANTING OF WAIVERS.—If the Secretary determines to grant a waiver under subsection (a)(1), the Secretary shall notify the State involved of such determination 

and the terms and effectiveness of such waiver. 

(B) DENIAL OF WAIVER.—If the Secretary determines 

a waiver should not be granted under subsection (a)(1), 

the Secretary shall notify the State involved, and the appropriate committees of Congress of such determination and 

the reasons therefore. 

(e) TERM OF WAIVER.—No waiver under this section may extend 

over a period of longer than 5 years unless the State requests 

continuation of such waiver, and such request shall be deemed 

granted unless the Secretary, within 90 days after the date of 

its submission to the Secretary, either denies such request in 

writing or informs the State in writing with respect to any additional information which is needed in order to make a final determination with respect to the request. 

SEC. 1333. PROVISIONS RELATING TO OFFERING OF PLANS IN MORE 

THAN ONE STATE. 

(a) HEALTH CARE CHOICE COMPACTS.— 

(1) IN GENERAL.—Not later than July 1, 2013, the Secretary 

shall, in consultation with the National Association of Insurance 

Commissioners, issue regulations for the creation of health 

care choice compacts under which 2 or more States may enter 

into an agreement under which— 

(A) 1 or more qualified health plans could be offered 

in the individual markets in all such States but, except 

as provided in subparagraph (B), only be subject to the 

laws and regulations of the State in which the plan was 

written or issued; 

(B) the issuer of any qualified health plan to which 

the compact applies— 

(i) would continue to be subject to market conduct, 

unfair trade practices, network adequacy, and consumer protection standards (including standards 

relating to rating), including addressing disputes as 

to the performance of the contract, of the State in 

which the purchaser resides; 

(ii) would be required to be licensed in each State 

in which it offers the plan under the compact or to 

submit to the jurisdiction of each such State with 

regard to the standards described in clause (i) 

(including allowing access to records as if the insurer 

were licensed in the State); and 

(iii) must clearly notify consumers that the policy 

may not be subject to all the laws and regulations 

of the State in which the purchaser resides. 

(2) STATE AUTHORITY.—A State may not enter into an 

agreement under this subsection unless the State enacts a 

law after the date of the enactment of this title that specifically 

authorizes the State to enter into such agreements. 

(3) APPROVAL OF COMPACTS.—The Secretary may approve 

interstate health care choice compacts under paragraph (1) 
H. R. 3590—89 

only if the Secretary determines that such health care choice 

compact— 

(A) will provide coverage that is at least as comprehensive as the coverage defined in section 1302(b) and offered 

through Exchanges established under this title; 

(B) will provide coverage and cost sharing protections 

against excessive out-of-pocket spending that are at least 

as affordable as the provisions of this title would provide; 

(C) will provide coverage to at least a comparable 

number of its residents as the provisions of this title would 

provide; 

(D) will not increase the Federal deficit; and 

(E) will not weaken enforcement of laws and regulations described in paragraph (1)(B)(i) in any State that 

is included in such compact. 

(4) EFFECTIVE DATE.—A health care choice compact 

described in paragraph (1) shall not take effect before January 

1, 2016. 

(b) AUTHORITY FOR NATIONWIDE PLANS.— 

(1) IN GENERAL.—Except as provided in paragraph (2), if 

an issuer (including a group of health insurance issuers affiliated either by common ownership and control or by the common 

use of a nationally licensed service mark) of a qualified health 

plan in the individual or small group market meets the requirements of this subsection (in this subsection a ‘‘nationwide qualified health plan’’)— 

(A) the issuer of the plan may offer the nationwide 

qualified health plan in the individual or small group 

market in more than 1 State; and 

(B) with respect to State laws mandating benefit coverage by a health plan, only the State laws of the State 

in which such plan is written or issued shall apply to 

the nationwide qualified health plan. 

(2) STATE OPT-OUT.—A State may, by specific reference 

in a law enacted after the date of enactment of this title, 

provide that this subsection shall not apply to that State. 

Such opt-out shall be effective until such time as the State 

by law revokes it. 

(3) PLAN REQUIREMENTS.—An issuer meets the requirements of this subsection with respect to a nationwide qualified 

health plan if, in the determination of the Secretary— 

(A) the plan offers a benefits package that is uniform 

in each State in which the plan is offered and meets the 

requirements set forth in paragraphs (4) through (6); 

(B) the issuer is licensed in each State in which it 

offers the plan and is subject to all requirements of State 

law not inconsistent with this section, including but not 

limited to, the standards and requirements that a State 

imposes that do not prevent the application of a requirement of part A of title XXVII of the Public Health Service 

Act or a requirement of this title; 

(C) the issuer meets all requirements of this title with 

respect to a qualified health plan, including the requirement to offer the silver and gold levels of the plan in 

each Exchange in the State for the market in which the 

plan is offered; 
H. R. 3590—90 

(D) the issuer determines the premiums for the plan 

in any State on the basis of the rating rules in effect 

in that State for the rating areas in which it is offered; 

(E) the issuer offers the nationwide qualified health 

plan in at least 60 percent of the participating States 

in the first year in which the plan is offered, 65 percent 

of such States in the second year, 70 percent of such 

States in the third year, 75 percent of such States in 

the fourth year, and 80 percent of such States in the 

fifth and subsequent years; 

(F) the issuer shall offer the plan in participating 

States across the country, in all geographic regions, and 

in all States that have adopted adjusted community rating 

before the date of enactment of this Act; and 

(G) the issuer clearly notifies consumers that the policy 

may not contain some benefits otherwise mandated for 

plans in the State in which the purchaser resides and 

provides a detailed statement of the benefits offered and 

the benefit differences in that State, in accordance with 

rules promulgated by the Secretary. 

(4) FORM REVIEW FOR NATIONWIDE PLANS.—Notwithstanding any contrary provision of State law, at least 3 months 

before any nationwide qualified health plan is offered, the 

issuer shall file all nationwide qualified health plan forms 

with the regulator in each participating State in which the 

plan will be offered. An issuer may appeal the disapproval 

of a nationwide qualified health plan form to the Secretary. 

(5) APPLICABLE RULES.—The Secretary shall, in consultation with the National Association of Insurance Commissioners, 

issue rules for the offering of nationwide qualified health plans 

under this subsection. Nationwide qualified health plans may 

be offered only after such rules have taken effect. 

(6) COVERAGE.—The Secretary shall provide that the health 

benefits coverage provided to an individual through a nationwide qualified health plan under this subsection shall include 

at least the essential benefits package described in section 

1302. 

(7) STATE LAW MANDATING BENEFIT COVERAGE BY A HEALTH

BENEFITS PLAN.—For the purposes of this subsection, a State 

law mandating benefit coverage by a health plan is a law 

that mandates health insurance coverage or the offer of health 

insurance coverage for specific health services or specific diseases. A law that mandates health insurance coverage or 

reimbursement for services provided by certain classes of providers of health care services, or a law that mandates that 

certain classes of individuals must be covered as a group or 

as dependents, is not a State law mandating benefit coverage 

by a health benefits plan. 

PART V—REINSURANCE AND RISK 

ADJUSTMENT 

SEC. 1341. TRANSITIONAL REINSURANCE PROGRAM FOR INDIVIDUAL 

AND SMALL GROUP MARKETS IN EACH STATE. 

(a) IN GENERAL.—Each State shall, not later than January 

1, 2014— 
H. R. 3590—91 

(1) include in the Federal standards or State law or regulation the State adopts and has in effect under section 1321(b) 

the provisions described in subsection (b); and 

(2) establish (or enter into a contract with) 1 or more 

applicable reinsurance entities to carry out the reinsurance 

program under this section. 

(b) MODEL REGULATION.— 

(1) IN GENERAL.—In establishing the Federal standards 

under section 1321(a), the Secretary, in consultation with the 

National Association of Insurance Commissioners (the ‘‘NAIC’’), 

shall include provisions that enable States to establish and 

maintain a program under which— 

(A) health insurance issuers, and third party administrators on behalf of group health plans, are required to 

make payments to an applicable reinsurance entity for 

any plan year beginning in the 3-year period beginning 

January 1, 2014 (as specified in paragraph (3); and 

(B) the applicable reinsurance entity collects payments 

under subparagraph (A) and uses amounts so collected 

to make reinsurance payments to health insurance issuers 

described in subparagraph (A) that cover high risk individuals in the individual market (excluding grandfathered 

health plans) for any plan year beginning in such 3-year 

period. 

(2) HIGH-RISK INDIVIDUAL; PAYMENT AMOUNTS.—The Secretary shall include the following in the provisions under paragraph (1): 

(A) DETERMINATION OF HIGH-RISK INDIVIDUALS.—The 

method by which individuals will be identified as high 

risk individuals for purposes of the reinsurance program 

established under this section. Such method shall provide 

for identification of individuals as high-risk individuals 

on the basis of— 

(i) a list of at least 50 but not more than 100 

medical conditions that are identified as high-risk 

conditions and that may be based on the identification 

of diagnostic and procedure codes that are indicative 

of individuals with pre-existing, high-risk conditions; 

or 

(ii) any other comparable objective method of 

identification recommended by the American Academy 

of Actuaries. 

(B) PAYMENT AMOUNT.—The formula for determining 

the amount of payments that will be paid to health insurance issuers described in paragraph (1)(A) that insure highrisk individuals. Such formula shall provide for the equitable allocation of available funds through reconciliation 

and may be designed— 

(i) to provide a schedule of payments that specifies 

the amount that will be paid for each of the conditions 

identified under subparagraph (A); or 

(ii) to use any other comparable method for determining payment amounts that is recommended by the 

American Academy of Actuaries and that encourages 

the use of care coordination and care management 

programs for high risk conditions. 

(3) DETERMINATION OF REQUIRED CONTRIBUTIONS.— 
H. R. 3590—92 

(A) IN GENERAL.—The Secretary shall include in the 

provisions under paragraph (1) the method for determining 

the amount each health insurance issuer and group health 

plan described in paragraph (1)(A) contributing to the 

reinsurance program under this section is required to contribute under such paragraph for each plan year beginning 

in the 36-month period beginning January 1, 2014. The 

contribution amount for any plan year may be based on 

the percentage of revenue of each issuer and the total 

costs of providing benefits to enrollees in self-insured plans 

or on a specified amount per enrollee and may be required 

to be paid in advance or periodically throughout the plan 

year. 

(B) SPECIFIC REQUIREMENTS.—The method under this 

paragraph shall be designed so that— 

(i) the contribution amount for each issuer proportionally reflects each issuer’s fully insured commercial 

book of business for all major medical products and 

the total value of all fees charged by the issuer and 

the costs of coverage administered by the issuer as 

a third party administrator; 

(ii) the contribution amount can include an additional amount to fund the administrative expenses of 

the applicable reinsurance entity; 

(iii) the aggregate contribution amounts for all 

States shall, based on the best estimates of the NAIC 

and without regard to amounts described in clause 

(ii), equal $10,000,000,000 for plan years beginning 

in 2014, $6,000,000,000 for plan years beginning 2015, 

and $4,000,000,000 for plan years beginning in 2016; 

and 

(iv) in addition to the aggregate contribution 

amounts under clause (iii), each issuer’s contribution 

amount for any calendar year under clause (iii) reflects 

its proportionate share of an additional $2,000,000,000 

for 2014, an additional $2,000,000,000 for 2015, and 

an additional $1,000,000,000 for 2016. 

Nothing in this subparagraph shall be construed to preclude a State from collecting additional amounts from 

issuers on a voluntary basis. 

(4) EXPENDITURE OF FUNDS.—The provisions under paragraph (1) shall provide that— 

(A) the contribution amounts collected for any calendar 

year may be allocated and used in any of the three calendar 

years for which amounts are collected based on the reinsurance needs of a particular period or to reflect experience 

in a prior period; and 

(B) amounts remaining unexpended as of December, 

2016, may be used to make payments under any reinsurance program of a State in the individual market in effect 

in the 2-year period beginning on January 1, 2017. 

Notwithstanding the preceding sentence, any contribution 

amounts described in paragraph (3)(B)(iv) shall be deposited 

into the general fund of the Treasury of the United States 

and may not be used for the program established under this 

section. 
H. R. 3590—93 

(c) APPLICABLE REINSURANCE ENTITY.—For purposes of this 

section— 

(1) IN GENERAL.—The term ‘‘applicable reinsurance entity’’ 

means a not-for-profit organization— 

(A) the purpose of which is to help stabilize premiums 

for coverage in the individual and small group markets 

in a State during the first 3 years of operation of an 

Exchange for such markets within the State when the 

risk of adverse selection related to new rating rules and 

market changes is greatest; and 

(B) the duties of which shall be to carry out the reinsurance program under this section by coordinating the 

funding and operation of the risk-spreading mechanisms 

designed to implement the reinsurance program. 

(2) STATE DISCRETION.—A State may have more than 1 

applicable reinsurance entity to carry out the reinsurance program under this section within the State and 2 or more States 

may enter into agreements to provide for an applicable reinsurance entity to carry out such program in all such States. 

(3) ENTITIES ARE TAX-EXEMPT.—An applicable reinsurance 

entity established under this section shall be exempt from 

taxation under chapter 1 of the Internal Revenue Code of 

1986. The preceding sentence shall not apply to the tax imposed 

by section 511 such Code (relating to tax on unrelated business 

taxable income of an exempt organization). 

(d) COORDINATION WITH STATE HIGH-RISK POOLS.—The State 

shall eliminate or modify any State high-risk pool to the extent 

necessary to carry out the reinsurance program established under 

this section. The State may coordinate the State high-risk pool 

with such program to the extent not inconsistent with the provisions 

of this section. 

SEC. 1342. ESTABLISHMENT OF RISK CORRIDORS FOR PLANS IN INDIVIDUAL AND SMALL GROUP MARKETS. 

(a) IN GENERAL.—The Secretary shall establish and administer 

a program of risk corridors for calendar years 2014, 2015, and 

2016 under which a qualified health plan offered in the individual 

or small group market shall participate in a payment adjustment 

system based on the ratio of the allowable costs of the plan to 

the plan’s aggregate premiums. Such program shall be based on 

the program for regional participating provider organizations under 

part D of title XVIII of the Social Security Act. 

(b) PAYMENT METHODOLOGY.— 

(1) PAYMENTS OUT.—The Secretary shall provide under the 

program established under subsection (a) that if— 

(A) a participating plan’s allowable costs for any plan 

year are more than 103 percent but not more than 108 

percent of the target amount, the Secretary shall pay to 

the plan an amount equal to 50 percent of the target 

amount in excess of 103 percent of the target amount; 

and 

(B) a participating plan’s allowable costs for any plan 

year are more than 108 percent of the target amount, 

the Secretary shall pay to the plan an amount equal to 

the sum of 2.5 percent of the target amount plus 80 percent 

of allowable costs in excess of 108 percent of the target 

amount. 
H. R. 3590—94 

(2) PAYMENTS IN.—The Secretary shall provide under the 

program established under subsection (a) that if— 

(A) a participating plan’s allowable costs for any plan 

year are less than 97 percent but not less than 92 percent 

of the target amount, the plan shall pay to the Secretary 

an amount equal to 50 percent of the excess of 97 percent 

of the target amount over the allowable costs; and 

(B) a participating plan’s allowable costs for any plan 

year are less than 92 percent of the target amount, the 

plan shall pay to the Secretary an amount equal to the 

sum of 2.5 percent of the target amount plus 80 percent 

of the excess of 92 percent of the target amount over 

the allowable costs. 

(c) DEFINITIONS.—In this section: 

(1) ALLOWABLE COSTS.— 

(A) IN GENERAL.—The amount of allowable costs of 

a plan for any year is an amount equal to the total costs 

(other than administrative costs) of the plan in providing 

benefits covered by the plan. 

(B) REDUCTION FOR RISK ADJUSTMENT AND REINSURANCE PAYMENTS.—Allowable costs shall reduced by any 

risk adjustment and reinsurance payments received under 

section 1341 and 1343. 

(2) TARGET AMOUNT.—The target amount of a plan for 

any year is an amount equal to the total premiums (including 

any premium subsidies under any governmental program), 

reduced by the administrative costs of the plan. 

SEC. 1343. RISK ADJUSTMENT. 

(a) IN GENERAL.— 

(1) LOW ACTUARIAL RISK PLANS.—Using the criteria and 

methods developed under subsection (b), each State shall assess 

a charge on health plans and health insurance issuers (with 

respect to health insurance coverage) described in subsection 

(c) if the actuarial risk of the enrollees of such plans or coverage 

for a year is less than the average actuarial risk of all enrollees 

in all plans or coverage in such State for such year that are 

not self-insured group health plans (which are subject to the 

provisions of the Employee Retirement Income Security Act 

of 1974). 

(2) HIGH ACTUARIAL RISK PLANS.—Using the criteria and 

methods developed under subsection (b), each State shall provide a payment to health plans and health insurance issuers 

(with respect to health insurance coverage) described in subsection (c) if the actuarial risk of the enrollees of such plans 

or coverage for a year is greater than the average actuarial 

risk of all enrollees in all plans and coverage in such State 

for such year that are not self-insured group health plans 

(which are subject to the provisions of the Employee Retirement 

Income Security Act of 1974). 

(b) CRITERIA AND METHODS.—The Secretary, in consultation 

with States, shall establish criteria and methods to be used in 

carrying out the risk adjustment activities under this section. The 

Secretary may utilize criteria and methods similar to the criteria 

and methods utilized under part C or D of title XVIII of the 

Social Security Act. Such criteria and methods shall be included 
H. R. 3590—95 

in the standards and requirements the Secretary prescribes under 

section 1321. 

(c) SCOPE.—A health plan or a health insurance issuer is 

described in this subsection if such health plan or health insurance 

issuer provides coverage in the individual or small group market 

within the State. This subsection shall not apply to a grandfathered 

health plan or the issuer of a grandfathered health plan with 

respect to that plan. 

Subtitle E—Affordable Coverage Choices 

for All Americans 

PART I—PREMIUM TAX CREDITS AND COSTSHARING REDUCTIONS 

Subpart A—Premium Tax Credits and Costsharing Reductions 

SEC. 1401. REFUNDABLE TAX CREDIT PROVIDING PREMIUM ASSISTANCE FOR COVERAGE UNDER A QUALIFIED HEALTH 

PLAN. 

(a) IN GENERAL.—Subpart C of part IV of subchapter A of 

chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by inserting after section 36A the following 

new section: 

‘‘SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A QUALIFIED 

HEALTH PLAN. 

‘‘(a) IN GENERAL.—In the case of an applicable taxpayer, there 

shall be allowed as a credit against the tax imposed by this subtitle 

for any taxable year an amount equal to the premium assistance 

credit amount of the taxpayer for the taxable year. 

‘‘(b) PREMIUM ASSISTANCE CREDIT AMOUNT.—For purposes of 

this section— 

‘‘(1) IN GENERAL.—The term ‘premium assistance credit 

amount’ means, with respect to any taxable year, the sum 

of the premium assistance amounts determined under paragraph (2) with respect to all coverage months of the taxpayer 

occurring during the taxable year. 

‘‘(2) PREMIUM ASSISTANCE AMOUNT.—The premium assistance amount determined under this subsection with respect 

to any coverage month is the amount equal to the lesser of— 

‘‘(A) the monthly premiums for such month for 1 or 

more qualified health plans offered in the individual market 

within a State which cover the taxpayer, the taxpayer’s 

spouse, or any dependent (as defined in section 152) of 

the taxpayer and which were enrolled in through an 

Exchange established by the State under 1311 of the 

Patient Protection and Affordable Care Act, or 

‘‘(B) the excess (if any) of— 

‘‘(i) the adjusted monthly premium for such month 

for the applicable second lowest cost silver plan with 

respect to the taxpayer, over 
H. R. 3590—96 

‘‘(ii) an amount equal to 1/12 of the product of 

the applicable percentage and the taxpayer’s household 

income for the taxable year. 

‘‘(3) OTHER TERMS AND RULES RELATING TO PREMIUM ASSISTANCE AMOUNTS.—For purposes of paragraph (2)— 

‘‘(A) APPLICABLE PERCENTAGE.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), the applicable percentage with respect to any taxpayer for any taxable year is equal to 2.8 percent, 

increased by the number of percentage points (not 

greater than 7) which bears the same ratio to 7 percentage points as— 

‘‘(I) the taxpayer’s household income for the 

taxable year in excess of 100 percent of the poverty 

line for a family of the size involved, bears to 

‘‘(II) an amount equal to 200 percent of the 

poverty line for a family of the size involved. 

‘‘(ii) SPECIAL RULE FOR TAXPAYERS UNDER 133 PERCENT OF POVERTY LINE.—If a taxpayer’s household 

income for the taxable year is in excess of 100 percent, 

but not more than 133 percent, of the poverty line 

for a family of the size involved, the taxpayer’s 

applicable percentage shall be 2 percent. 

‘‘(iii) INDEXING.—In the case of taxable years beginning in any calendar year after 2014, the Secretary 

shall adjust the initial and final applicable percentages 

under clause (i), and the 2 percent under clause (ii), 

for the calendar year to reflect the excess of the rate 

of premium growth between the preceding calendar 

year and 2013 over the rate of income growth for 

such period. 

‘‘(B) APPLICABLE SECOND LOWEST COST SILVER PLAN.— 

The applicable second lowest cost silver plan with respect 

to any applicable taxpayer is the second lowest cost silver 

plan of the individual market in the rating area in which 

the taxpayer resides which— 

‘‘(i) is offered through the same Exchange through 

which the qualified health plans taken into account 

under paragraph (2)(A) were offered, and 

‘‘(ii) provides— 

‘‘(I) self-only coverage in the case of an 

applicable taxpayer— 

‘‘(aa) whose tax for the taxable year is 

determined under section 1(c) (relating to 

unmarried individuals other than surviving 

spouses and heads of households) and who 

is not allowed a deduction under section 151 

for the taxable year with respect to a 

dependent, or 

‘‘(bb) who is not described in item (aa) 

but who purchases only self-only coverage, and 

‘‘(II) family coverage in the case of any other 

applicable taxpayer. 

If a taxpayer files a joint return and no credit is allowed 

under this section with respect to 1 of the spouses by 

reason of subsection (e), the taxpayer shall be treated as 

described in clause (ii)(I) unless a deduction is allowed 
H. R. 3590—97 

under section 151 for the taxable year with respect to 

a dependent other than either spouse and subsection (e) 

does not apply to the dependent. 

‘‘(C) ADJUSTED MONTHLY PREMIUM.—The adjusted 

monthly premium for an applicable second lowest cost 

silver plan is the monthly premium which would have 

been charged (for the rating area with respect to which 

the premiums under paragraph (2)(A) were determined) 

for the plan if each individual covered under a qualified 

health plan taken into account under paragraph (2)(A) 

were covered by such silver plan and the premium was 

adjusted only for the age of each such individual in the 

manner allowed under section 2701 of the Public Health 

Service Act. In the case of a State participating in the 

wellness discount demonstration project under section 

2705(d) of the Public Health Service Act, the adjusted 

monthly premium shall be determined without regard to 

any premium discount or rebate under such project. 

‘‘(D) ADDITIONAL BENEFITS.—If— 

‘‘(i) a qualified health plan under section 1302(b)(5) 

of the Patient Protection and Affordable Care Act offers 

benefits in addition to the essential health benefits 

required to be provided by the plan, or 

‘‘(ii) a State requires a qualified health plan under 

section 1311(d)(3)(B) of such Act to cover benefits in 

addition to the essential health benefits required to 

be provided by the plan, 

the portion of the premium for the plan properly allocable 

(under rules prescribed by the Secretary of Health and 

Human Services) to such additional benefits shall not be 

taken into account in determining either the monthly premium or the adjusted monthly premium under paragraph 

(2). 

‘‘(E) SPECIAL RULE FOR PEDIATRIC DENTAL COVERAGE.— 

For purposes of determining the amount of any monthly 

premium, if an individual enrolls in both a qualified health 

plan and a plan described in section 1311(d)(2)(B)(ii)(I) 

of the Patient Protection and Affordable Care Act for any 

plan year, the portion of the premium for the plan described 

in such section that (under regulations prescribed by the 

Secretary) is properly allocable to pediatric dental benefits 

which are included in the essential health benefits required 

to be provided by a qualified health plan under section 

1302(b)(1)(J) of such Act shall be treated as a premium 

payable for a qualified health plan. 

‘‘(c) DEFINITION AND RULES RELATING TO APPLICABLE TAXPAYERS, COVERAGE MONTHS, AND QUALIFIED HEALTH PLAN.—For 

purposes of this section— 

‘‘(1) APPLICABLE TAXPAYER.— 

‘‘(A) IN GENERAL.—The term ‘applicable taxpayer’ 

means, with respect to any taxable year, a taxpayer whose 

household income for the taxable year exceeds 100 percent 

but does not exceed 400 percent of an amount equal to 

the poverty line for a family of the size involved. 

‘‘(B) SPECIAL RULE FOR CERTAIN INDIVIDUALS LAWFULLY

PRESENT IN THE UNITED STATES.—If— 
H. R. 3590—98 

‘‘(i) a taxpayer has a household income which is 

not greater than 100 percent of an amount equal to 

the poverty line for a family of the size involved, and 

‘‘(ii) the taxpayer is an alien lawfully present in 

the United States, but is not eligible for the medicaid 

program under title XIX of the Social Security Act 

by reason of such alien status, 

the taxpayer shall, for purposes of the credit under this 

section, be treated as an applicable taxpayer with a household income which is equal to 100 percent of the poverty 

line for a family of the size involved. 

‘‘(C) MARRIED COUPLES MUST FILE JOINT RETURN.— 

If the taxpayer is married (within the meaning of section 

7703) at the close of the taxable year, the taxpayer shall 

be treated as an applicable taxpayer only if the taxpayer 

and the taxpayer’s spouse file a joint return for the taxable 

year. 

‘‘(D) DENIAL OF CREDIT TO DEPENDENTS.—No credit 

shall be allowed under this section to any individual with 

respect to whom a deduction under section 151 is allowable 

to another taxpayer for a taxable year beginning in the 

calendar year in which such individual’s taxable year 

begins. 

‘‘(2) COVERAGE MONTH.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘coverage month’ means, 

with respect to an applicable taxpayer, any month if— 

‘‘(i) as of the first day of such month the taxpayer, 

the taxpayer’s spouse, or any dependent of the taxpayer 

is covered by a qualified health plan described in subsection (b)(2)(A) that was enrolled in through an 

Exchange established by the State under section 1311 

of the Patient Protection and Affordable Care Act, and 

‘‘(ii) the premium for coverage under such plan 

for such month is paid by the taxpayer (or through 

advance payment of the credit under subsection (a) 

under section 1412 of the Patient Protection and 

Affordable Care Act). 

‘‘(B) EXCEPTION FOR MINIMUM ESSENTIAL COVERAGE.— ‘‘(i) IN GENERAL.—The term ‘coverage month’ shall 

not include any month with respect to an individual 

if for such month the individual is eligible for minimum 

essential coverage other than eligibility for coverage 

described in section 5000A(f)(1)(C) (relating to coverage 

in the individual market). 

‘‘(ii) MINIMUM ESSENTIAL COVERAGE.—The term 

‘minimum essential coverage’ has the meaning given 

such term by section 5000A(f). 

‘‘(C) SPECIAL RULE FOR EMPLOYER-SPONSORED MINIMUM

ESSENTIAL COVERAGE.—For purposes of subparagraph (B)— 

‘‘(i) COVERAGE MUST BE AFFORDABLE.—Except as 

provided in clause (iii), an employee shall not be 

treated as eligible for minimum essential coverage if 

such coverage— 

‘‘(I) consists of an eligible employer-sponsored 

plan (as defined in section 5000A(f)(2)), and 

‘‘(II) the employee’s required contribution 

(within the meaning of section 5000A(e)(1)(B)) with 
H. R. 3590—99 

respect to the plan exceeds 9.8 percent of the 

applicable taxpayer’s household income. 

This clause shall also apply to an individual who is 

eligible to enroll in the plan by reason of a relationship 

the individual bears to the employee. 

‘‘(ii) COVERAGE MUST PROVIDE MINIMUM VALUE.— 

Except as provided in clause (iii), an employee shall 

not be treated as eligible for minimum essential coverage if such coverage consists of an eligible employersponsored plan (as defined in section 5000A(f)(2)) and 

the plan’s share of the total allowed costs of benefits 

provided under the plan is less than 60 percent of 

such costs. 

‘‘(iii) EMPLOYEE OR FAMILY MUST NOT BE COVERED

UNDER EMPLOYER PLAN.—Clauses (i) and (ii) shall not 

apply if the employee (or any individual described in 

the last sentence of clause (i)) is covered under the 

eligible employer-sponsored plan or the grandfathered 

health plan. 

‘‘(iv) INDEXING.—In the case of plan years beginning in any calendar year after 2014, the Secretary 

shall adjust the 9.8 percent under clause (i)(II) in the 

same manner as the percentages are adjusted under 

subsection (b)(3)(A)(ii). 

‘‘(3) DEFINITIONS AND OTHER RULES.— ‘‘(A) QUALIFIED HEALTH PLAN.—The term ‘qualified 

health plan’ has the meaning given such term by section 

1301(a) of the Patient Protection and Affordable Care Act, 

except that such term shall not include a qualified health 

plan which is a catastrophic plan described in section 

1302(e) of such Act. 

‘‘(B) GRANDFATHERED HEALTH PLAN.—The term ‘grandfathered health plan’ has the meaning given such term 

by section 1251 of the Patient Protection and Affordable 

Care Act. 

‘‘(d) TERMS RELATING TO INCOME AND FAMILIES.—For purposes 

of this section— 

‘‘(1) FAMILY SIZE.—The family size involved with respect 

to any taxpayer shall be equal to the number of individuals 

for whom the taxpayer is allowed a deduction under section 

151 (relating to allowance of deduction for personal exemptions) 

for the taxable year. 

‘‘(2) HOUSEHOLD INCOME.— 

‘‘(A) HOUSEHOLD INCOME.—The term ‘household 

income’ means, with respect to any taxpayer, an amount 

equal to the sum of— 

‘‘(i) the modified gross income of the taxpayer, 

plus 

‘‘(ii) the aggregate modified gross incomes of all 

other individuals who— 

‘‘(I) were taken into account in determining 

the taxpayer’s family size under paragraph (1), 

and 

‘‘(II) were required to file a return of tax 

imposed by section 1 for the taxable year. 

‘‘(B) MODIFIED GROSS INCOME.—The term ‘modified 

gross income’ means gross income— 
H. R. 3590—100 

‘‘(i) decreased by the amount of any deduction 

allowable under paragraph (1), (3), (4), or (10) of section 

62(a), 

‘‘(ii) increased by the amount of interest received 

or accrued during the taxable year which is exempt 

from tax imposed by this chapter, and 

‘‘(iii) determined without regard to sections 911, 

931, and 933. 

‘‘(3) POVERTY LINE.— 

‘‘(A) IN GENERAL.—The term ‘poverty line’ has the 

meaning given that term in section 2110(c)(5) of the Social 

Security Act (42 U.S.C. 1397jj(c)(5)). 

‘‘(B) POVERTY LINE USED.—In the case of any qualified 

health plan offered through an Exchange for coverage 

during a taxable year beginning in a calendar year, the 

poverty line used shall be the most recently published 

poverty line as of the 1st day of the regular enrollment 

period for coverage during such calendar year. 

‘‘(e) RULES FOR INDIVIDUALS NOT LAWFULLY PRESENT.— 

‘‘(1) IN GENERAL.—If 1 or more individuals for whom a 

taxpayer is allowed a deduction under section 151 (relating 

to allowance of deduction for personal exemptions) for the taxable year (including the taxpayer or his spouse) are individuals 

who are not lawfully present— 

‘‘(A) the aggregate amount of premiums otherwise 

taken into account under clauses (i) and (ii) of subsection 

(b)(2)(A) shall be reduced by the portion (if any) of such 

premiums which is attributable to such individuals, and 

‘‘(B) for purposes of applying this section, the determination as to what percentage a taxpayer’s household 

income bears to the poverty level for a family of the size 

involved shall be made under one of the following methods: 

‘‘(i) A method under which— 

‘‘(I) the taxpayer’s family size is determined 

by not taking such individuals into account, and 

‘‘(II) the taxpayer’s household income is equal 

to the product of the taxpayer’s household income 

(determined without regard to this subsection) and 

a fraction— 

‘‘(aa) the numerator of which is the poverty line for the taxpayer’s family size determined after application of subclause (I), and 

‘‘(bb) the denominator of which is the poverty line for the taxpayer’s family size determined without regard to subclause (I). 

‘‘(ii) A comparable method reaching the same result 

as the method under clause (i). 

‘‘(2) LAWFULLY PRESENT.—For purposes of this section, an 

individual shall be treated as lawfully present only if the individual is, and is reasonably expected to be for the entire period 

of enrollment for which the credit under this section is being 

claimed, a citizen or national of the United States or an alien 

lawfully present in the United States. 

‘‘(3) SECRETARIAL AUTHORITY.—The Secretary of Health and 

Human Services, in consultation with the Secretary, shall prescribe rules setting forth the methods by which calculations 

of family size and household income are made for purposes 
H. R. 3590—101 

of this subsection. Such rules shall be designed to ensure that 

the least burden is placed on individuals enrolling in qualified 

health plans through an Exchange and taxpayers eligible for 

the credit allowable under this section. 

‘‘(f) RECONCILIATION OF CREDIT AND ADVANCE CREDIT.— 

‘‘(1) IN GENERAL.—The amount of the credit allowed under 

this section for any taxable year shall be reduced (but not 

below zero) by the amount of any advance payment of such 

credit under section 1412 of the Patient Protection and Affordable Care Act. 

‘‘(2) EXCESS ADVANCE PAYMENTS.— ‘‘(A) IN GENERAL.—If the advance payments to a taxpayer under section 1412 of the Patient Protection and 

Affordable Care Act for a taxable year exceed the credit 

allowed by this section (determined without regard to paragraph (1)), the tax imposed by this chapter for the taxable 

year shall be increased by the amount of such excess. 

‘‘(B) LIMITATION ON INCREASE WHERE INCOME LESS

THAN 400 PERCENT OF POVERTY LINE.— 

‘‘(i) IN GENERAL.—In the case of an applicable taxpayer whose household income is less than 400 percent 

of the poverty line for the size of the family involved 

for the taxable year, the amount of the increase under 

subparagraph (A) shall in no event exceed $400 ($250 

in the case of a taxpayer whose tax is determined 

under section 1(c) for the taxable year). 

‘‘(ii) INDEXING OF AMOUNT.—In the case of any 

calendar year beginning after 2014, each of the dollar 

amounts under clause (i) shall be increased by an 

amount equal to— 

‘‘(I) such dollar amount, multiplied by 

‘‘(II) the cost-of-living adjustment determined 

under section 1(f)(3) for the calendar year, determined by substituting ‘calendar year 2013’ for ‘calendar year 1992’ in subparagraph (B) thereof. 

If the amount of any increase under clause (i) is not 

a multiple of $50, such increase shall be rounded to 

the next lowest multiple of $50. 

‘‘(g) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to carry out the provisions of this section, 

including regulations which provide for— 

‘‘(1) the coordination of the credit allowed under this section 

with the program for advance payment of the credit under 

section 1412 of the Patient Protection and Affordable Care 

Act, and 

‘‘(2) the application of subsection (f) where the filing status 

of the taxpayer for a taxable year is different from such status 

used for determining the advance payment of the credit.’’. 

(b) DISALLOWANCE OF DEDUCTION.—Section 280C of the 

Internal Revenue Code of 1986 is amended by adding at the end 

the following new subsection: 

‘‘(g) CREDIT FOR HEALTH INSURANCE PREMIUMS.—No deduction 

shall be allowed for the portion of the premiums paid by the 

taxpayer for coverage of 1 or more individuals under a qualified 

health plan which is equal to the amount of the credit determined 

for the taxable year under section 36B(a) with respect to such 

premiums.’’. 
H. R. 3590—102 

(c) STUDY ON AFFORDABLE COVERAGE.— 

(1) STUDY AND REPORT.— 

(A) IN GENERAL.—Not later than 5 years after the 

date of the enactment of this Act, the Comptroller General 

shall conduct a study on the affordability of health insurance coverage, including— 

(i) the impact of the tax credit for qualified health 

insurance coverage of individuals under section 36B 

of the Internal Revenue Code of 1986 and the tax 

credit for employee health insurance expenses of small 

employers under section 45R of such Code on 

maintaining and expanding the health insurance coverage of individuals; 

(ii) the availability of affordable health benefits 

plans, including a study of whether the percentage 

of household income used for purposes of section 

36B(c)(2)(C) of the Internal Revenue Code of 1986 (as 

added by this section) is the appropriate level for determining whether employer-provided coverage is affordable for an employee and whether such level may 

be lowered without significantly increasing the costs 

to the Federal Government and reducing employerprovided coverage; and 

(iii) the ability of individuals to maintain essential 

health benefits coverage (as defined in section 5000A(f) 

of the Internal Revenue Code of 1986). 

(B) REPORT.—The Comptroller General shall submit 

to the appropriate committees of Congress a report on 

the study conducted under subparagraph (A), together with 

legislative recommendations relating to the matters studied 

under such subparagraph. 

(2) APPROPRIATE COMMITTEES OF CONGRESS.—In this subsection, the term ‘‘appropriate committees of Congress’’ means 

the Committee on Ways and Means, the Committee on Education and Labor, and the Committee on Energy and Commerce 

of the House of Representatives and the Committee on Finance 

and the Committee on Health, Education, Labor and Pensions 

of the Senate. 

(d) CONFORMING AMENDMENTS.— 

(1) Paragraph (2) of section 1324(b) of title 31, United 

States Code, is amended by inserting ‘‘36B,’’ after ‘‘36A,’’. 

(2) The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 

is amended by inserting after the item relating to section 36A 

the following new item: 

‘‘Sec. 36B. Refundable credit for coverage under a qualified health plan.’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years ending after December 31, 2013. 

SEC. 1402. REDUCED COST-SHARING FOR INDIVIDUALS ENROLLING 

IN QUALIFIED HEALTH PLANS. 

(a) IN GENERAL.—In the case of an eligible insured enrolled 

in a qualified health plan— 

(1) the Secretary shall notify the issuer of the plan of 

such eligibility; and 

(2) the issuer shall reduce the cost-sharing under the plan 

at the level and in the manner specified in subsection (c). 
H. R. 3590—103 

(b) ELIGIBLE INSURED.—In this section, the term ‘‘eligible 

insured’’ means an individual— 

(1) who enrolls in a qualified health plan in the silver 

level of coverage in the individual market offered through an 

Exchange; and 

(2) whose household income exceeds 100 percent but does 

not exceed 400 percent of the poverty line for a family of 

the size involved. 

In the case of an individual described in section 36B(c)(1)(B) of 

the Internal Revenue Code of 1986, the individual shall be treated 

as having household income equal to 100 percent for purposes 

of applying this section. 

(c) DETERMINATION OF REDUCTION IN COST-SHARING.— 

(1) REDUCTION IN OUT-OF-POCKET LIMIT.— 

(A) IN GENERAL.—The reduction in cost-sharing under 

this subsection shall first be achieved by reducing the 

applicable out-of pocket limit under section 1302(c)(1) in 

the case of— 

(i) an eligible insured whose household income is 

more than 100 percent but not more than 200 percent 

of the poverty line for a family of the size involved, 

by two-thirds; 

(ii) an eligible insured whose household income 

is more than 200 percent but not more than 300 percent of the poverty line for a family of the size involved, 

by one-half; and 

(iii) an eligible insured whose household income 

is more than 300 percent but not more than 400 percent of the poverty line for a family of the size involved, 

by one-third. 

(B) COORDINATION WITH ACTUARIAL VALUE LIMITS.— 

(i) IN GENERAL.—The Secretary shall ensure the 

reduction under this paragraph shall not result in an 

increase in the plan’s share of the total allowed costs 

of benefits provided under the plan above— 

(I) 90 percent in the case of an eligible insured 

described in paragraph (2)(A); 

(II) 80 percent in the case of an eligible insured 

described in paragraph (2)(B); and 

(III) 70 percent in the case of an eligible 

insured described in clause (ii) or (iii) of subparagraph (A). 

(ii) ADJUSTMENT.—The Secretary shall adjust the 

out-of pocket limits under paragraph (1) if necessary 

to ensure that such limits do not cause the respective 

actuarial values to exceed the levels specified in clause 

(i). 

(2) ADDITIONAL REDUCTION FOR LOWER INCOME INSUREDS.— 

The Secretary shall establish procedures under which the issuer 

of a qualified health plan to which this section applies shall 

further reduce cost-sharing under the plan in a manner sufficient to— 

(A) in the case of an eligible insured whose household 

income is not less than 100 percent but not more than 

150 percent of the poverty line for a family of the size 

involved, increase the plan’s share of the total allowed 
H. R. 3590—104 

costs of benefits provided under the plan to 90 percent 

of such costs; and 

(B) in the case of an eligible insured whose household 

income is more than 150 percent but not more than 200 

percent of the poverty line for a family of the size involved, 

increase the plan’s share of the total allowed costs of benefits provided under the plan to 80 percent of such costs. 

(3) METHODS FOR REDUCING COST-SHARING.— 

(A) IN GENERAL.—An issuer of a qualified health plan 

making reductions under this subsection shall notify the 

Secretary of such reductions and the Secretary shall make 

periodic and timely payments to the issuer equal to the 

value of the reductions. 

(B) CAPITATED PAYMENTS.—The Secretary may establish a capitated payment system to carry out the payment 

of cost-sharing reductions under this section. Any such 

system shall take into account the value of the reductions 

and make appropriate risk adjustments to such payments. 

(4) ADDITIONAL BENEFITS.—If a qualified health plan under 

section 1302(b)(5) offers benefits in addition to the essential 

health benefits required to be provided by the plan, or a State 

requires a qualified health plan under section 1311(d)(3)(B) 

to cover benefits in addition to the essential health benefits 

required to be provided by the plan, the reductions in costsharing under this section shall not apply to such additional 

benefits. 

(5) SPECIAL RULE FOR PEDIATRIC DENTAL PLANS.—If an 

individual enrolls in both a qualified health plan and a plan 

described in section 1311(d)(2)(B)(ii)(I) for any plan year, subsection (a) shall not apply to that portion of any reduction 

in cost-sharing under subsection (c) that (under regulations 

prescribed by the Secretary) is properly allocable to pediatric 

dental benefits which are included in the essential health benefits required to be provided by a qualified health plan under 

section 1302(b)(1)(J). 

(d) SPECIAL RULES FOR INDIANS.— (1) INDIANS UNDER 300 PERCENT OF POVERTY.—If an individual enrolled in any qualified health plan in the individual 

market through an Exchange is an Indian (as defined in section 

4(d) of the Indian Self-Determination and Education Assistance 

Act (25 U.S.C. 450b(d))) whose household income is not more 

than 300 percent of the poverty line for a family of the size 

involved, then, for purposes of this section— 

(A) such individual shall be treated as an eligible 

insured; and 

(B) the issuer of the plan shall eliminate any costsharing under the plan. 

(2) ITEMS OR SERVICES FURNISHED THROUGH INDIAN HEALTH

PROVIDERS.—If an Indian (as so defined) enrolled in a qualified 

health plan is furnished an item or service directly by the 

Indian Health Service, an Indian Tribe, Tribal Organization, 

or Urban Indian Organization or through referral under contract health services— 

(A) no cost-sharing under the plan shall be imposed 

under the plan for such item or service; and 

(B) the issuer of the plan shall not reduce the payment 

to any such entity for such item or service by the amount 
H. R. 3590—105 

of any cost-sharing that would be due from the Indian 

but for subparagraph (A). 

(3) PAYMENT.—The Secretary shall pay to the issuer of 

a qualified health plan the amount necessary to reflect the 

increase in actuarial value of the plan required by reason 

of this subsection. 

(e) RULES FOR INDIVIDUALS NOT LAWFULLY PRESENT.— 

(1) IN GENERAL.—If an individual who is an eligible insured 

is not lawfully present— 

(A) no cost-sharing reduction under this section shall 

apply with respect to the individual; and 

(B) for purposes of applying this section, the determination as to what percentage a taxpayer’s household income 

bears to the poverty level for a family of the size involved 

shall be made under one of the following methods: 

(i) A method under which— 

(I) the taxpayer’s family size is determined 

by not taking such individuals into account, and 

(II) the taxpayer’s household income is equal 

to the product of the taxpayer’s household income 

(determined without regard to this subsection) and 

a fraction— 

(aa) the numerator of which is the poverty 

line for the taxpayer’s family size determined 

after application of subclause (I), and 

(bb) the denominator of which is the poverty line for the taxpayer’s family size determined without regard to subclause (I). 

(ii) A comparable method reaching the same result 

as the method under clause (i). 

(2) LAWFULLY PRESENT.—For purposes of this section, an 

individual shall be treated as lawfully present only if the individual is, and is reasonably expected to be for the entire period 

of enrollment for which the cost-sharing reduction under this 

section is being claimed, a citizen or national of the United 

States or an alien lawfully present in the United States. 

(3) SECRETARIAL AUTHORITY.—The Secretary, in consultation with the Secretary of the Treasury, shall prescribe rules 

setting forth the methods by which calculations of family size 

and household income are made for purposes of this subsection. 

Such rules shall be designed to ensure that the least burden 

is placed on individuals enrolling in qualified health plans 

through an Exchange and taxpayers eligible for the credit allowable under this section. 

(f) DEFINITIONS AND SPECIAL RULES.—In this section: 

(1) IN GENERAL.—Any term used in this section which 

is also used in section 36B of the Internal Revenue Code of 

1986 shall have the meaning given such term by such section. 

(2) LIMITATIONS ON REDUCTION.—No cost-sharing reduction 

shall be allowed under this section with respect to coverage 

for any month unless the month is a coverage month with 

respect to which a credit is allowed to the insured (or an 

applicable taxpayer on behalf of the insured) under section 

36B of such Code. 

(3) DATA USED FOR ELIGIBILITY.—Any determination under 

this section shall be made on the basis of the taxable year 

for which the advance determination is made under section 
H. R. 3590—106 

1412 and not the taxable year for which the credit under 

section 36B of such Code is allowed. 

Subpart B—Eligibility Determinations 

SEC. 1411. PROCEDURES FOR DETERMINING ELIGIBILITY FOR 

EXCHANGE PARTICIPATION, PREMIUM TAX CREDITS AND 

REDUCED COST-SHARING, AND INDIVIDUAL RESPONSIBILITY EXEMPTIONS. 

(a) ESTABLISHMENT OF PROGRAM.—The Secretary shall establish a program meeting the requirements of this section for determining— 

(1) whether an individual who is to be covered in the 

individual market by a qualified health plan offered through 

an Exchange, or who is claiming a premium tax credit or 

reduced cost-sharing, meets the requirements of sections 

1312(f)(3), 1402(e), and 1412(d) of this title and section 36B(e) 

of the Internal Revenue Code of 1986 that the individual be 

a citizen or national of the United States or an alien lawfully 

present in the United States; 

(2) in the case of an individual claiming a premium tax 

credit or reduced cost-sharing under section 36B of such Code 

or section 1402— 

(A) whether the individual meets the income and coverage requirements of such sections; and 

(B) the amount of the tax credit or reduced costsharing; 

(3) whether an individual’s coverage under an employersponsored health benefits plan is treated as unaffordable under 

sections 36B(c)(2)(C) and 5000A(e)(2); and 

(4) whether to grant a certification under section 

1311(d)(4)(H) attesting that, for purposes of the individual 

responsibility requirement under section 5000A of the Internal 

Revenue Code of 1986, an individual is entitled to an exemption 

from either the individual responsibility requirement or the 

penalty imposed by such section. 

(b) INFORMATION REQUIRED TO BE PROVIDED BY APPLICANTS.— (1) IN GENERAL.—An applicant for enrollment in a qualified 

health plan offered through an Exchange in the individual 

market shall provide— 

(A) the name, address, and date of birth of each individual who is to be covered by the plan (in this subsection 

referred to as an ‘‘enrollee’’); and 

(B) the information required by any of the following 

paragraphs that is applicable to an enrollee. 

(2) CITIZENSHIP OR IMMIGRATION STATUS.—The following 

information shall be provided with respect to every enrollee: 

(A) In the case of an enrollee whose eligibility is based 

on an attestation of citizenship of the enrollee, the enrollee’s 

social security number. 

(B) In the case of an individual whose eligibility is 

based on an attestation of the enrollee’s immigration status, 

the enrollee’s social security number (if applicable) and 

such identifying information with respect to the enrollee’s 

immigration status as the Secretary, after consultation 

with the Secretary of Homeland Security, determines 

appropriate. 
H. R. 3590—107 

(3) ELIGIBILITY AND AMOUNT OF TAX CREDIT OR REDUCED

COST-SHARING.—In the case of an enrollee with respect to whom 

a premium tax credit or reduced cost-sharing under section 

36B of such Code or section 1402 is being claimed, the following 

information: 

(A) INFORMATION REGARDING INCOME AND FAMILY

SIZE.—The information described in section 6103(l)(21) for 

the taxable year ending with or within the second calendar 

year preceding the calendar year in which the plan year 

begins. 

(B) CHANGES IN CIRCUMSTANCES.—The information 

described in section 1412(b)(2), including information with 

respect to individuals who were not required to file an 

income tax return for the taxable year described in 

subparagraph (A) or individuals who experienced changes 

in marital status or family size or significant reductions 

in income. 

(4) EMPLOYER-SPONSORED COVERAGE.—In the case of an 

enrollee with respect to whom eligibility for a premium tax 

credit under section 36B of such Code or cost-sharing reduction 

under section 1402 is being established on the basis that the 

enrollee’s (or related individual’s) employer is not treated under 

section 36B(c)(2)(C) of such Code as providing minimum essential coverage or affordable minimum essential coverage, the 

following information: 

(A) The name, address, and employer identification 

number (if available) of the employer. 

(B) Whether the enrollee or individual is a full-time 

employee and whether the employer provides such minimum essential coverage. 

(C) If the employer provides such minimum essential 

coverage, the lowest cost option for the enrollee’s or individual’s enrollment status and the enrollee’s or individual’s 

required contribution (within the meaning of section 

5000A(e)(1)(B) of such Code) under the employer-sponsored 

plan. 

(D) If an enrollee claims an employer’s minimum essential coverage is unaffordable, the information described 

in paragraph (3). 

If an enrollee changes employment or obtains additional 

employment while enrolled in a qualified health plan for which 

such credit or reduction is allowed, the enrollee shall notify 

the Exchange of such change or additional employment and 

provide the information described in this paragraph with 

respect to the new employer. 

(5) EXEMPTIONS FROM INDIVIDUAL RESPONSIBILITY REQUIREMENTS.—In the case of an individual who is seeking an exemption certificate under section 1311(d)(4)(H) from any requirement or penalty imposed by section 5000A, the following 

information: 

(A) In the case of an individual seeking exemption 

based on the individual’s status as a member of an exempt 

religious sect or division, as a member of a health care 

sharing ministry, as an Indian, or as an individual eligible 

for a hardship exemption, such information as the Secretary shall prescribe. 
H. R. 3590—108 

(B) In the case of an individual seeking exemption 

based on the lack of affordable coverage or the individual’s 

status as a taxpayer with household income less than 100 

percent of the poverty line, the information described in 

paragraphs (3) and (4), as applicable. 

(c) VERIFICATION OF INFORMATION CONTAINED IN RECORDS OF

SPECIFIC FEDERAL OFFICIALS.— 

(1) INFORMATION TRANSFERRED TO SECRETARY.—An 

Exchange shall submit the information provided by an applicant 

under subsection (b) to the Secretary for verification in accordance with the requirements of this subsection and subsection 

(d). 

(2) CITIZENSHIP OR IMMIGRATION STATUS.— 

(A) COMMISSIONER OF SOCIAL SECURITY.—The Secretary shall submit to the Commissioner of Social Security 

the following information for a determination as to whether 

the information provided is consistent with the information 

in the records of the Commissioner: 

(i) The name, date of birth, and social security 

number of each individual for whom such information 

was provided under subsection (b)(2). 

(ii) The attestation of an individual that the individual is a citizen. 

(B) SECRETARY OF HOMELAND SECURITY.— 

(i) IN GENERAL.—In the case of an individual— 

(I) who attests that the individual is an alien 

lawfully present in the United States; or 

(II) who attests that the individual is a citizen 

but with respect to whom the Commissioner of 

Social Security has notified the Secretary under 

subsection (e)(3) that the attestation is inconsistent 

with information in the records maintained by the 

Commissioner; 

the Secretary shall submit to the Secretary of Homeland Security the information described in clause (ii) 

for a determination as to whether the information provided is consistent with the information in the records 

of the Secretary of Homeland Security. 

(ii) INFORMATION.—The information described in 

clause (ii) is the following: 

(I) The name, date of birth, and any identifying 

information with respect to the individual’s 

immigration status provided under subsection 

(b)(2). 

(II) The attestation that the individual is an 

alien lawfully present in the United States or in 

the case of an individual described in clause (i)(II), 

the attestation that the individual is a citizen. 

(3) ELIGIBILITY FOR TAX CREDIT AND COST-SHARING REDUCTION.—The Secretary shall submit the information described 

in subsection (b)(3)(A) provided under paragraph (3), (4), or 

(5) of subsection (b) to the Secretary of the Treasury for 

verification of household income and family size for purposes 

of eligibility. 

(4) METHODS.— (A) IN GENERAL.—The Secretary, in consultation with 

the Secretary of the Treasury, the Secretary of Homeland 
H. R. 3590—109 

Security, and the Commissioner of Social Security, shall 

provide that verifications and determinations under this 

subsection shall be done— 

(i) through use of an on-line system or otherwise 

for the electronic submission of, and response to, the 

information submitted under this subsection with 

respect to an applicant; or 

(ii) by determining the consistency of the information submitted with the information maintained in the 

records of the Secretary of the Treasury, the Secretary 

of Homeland Security, or the Commissioner of Social 

Security through such other method as is approved 

by the Secretary. 

(B) FLEXIBILITY.—The Secretary may modify the 

methods used under the program established by this section 

for the Exchange and verification of information if the 

Secretary determines such modifications would reduce the 

administrative costs and burdens on the applicant, 

including allowing an applicant to request the Secretary 

of the Treasury to provide the information described in 

paragraph (3) directly to the Exchange or to the Secretary. 

The Secretary shall not make any such modification unless 

the Secretary determines that any applicable requirements 

under this section and section 6103 of the Internal Revenue 

Code of 1986 with respect to the confidentiality, disclosure, 

maintenance, or use of information will be met. 

(d) VERIFICATION BY SECRETARY.—In the case of information 

provided under subsection (b) that is not required under subsection 

(c) to be submitted to another person for verification, the Secretary 

shall verify the accuracy of such information in such manner as 

the Secretary determines appropriate, including delegating responsibility for verification to the Exchange. 

(e) ACTIONS RELATING TO VERIFICATION.— 

(1) IN GENERAL.—Each person to whom the Secretary provided information under subsection (c) shall report to the Secretary under the method established under subsection (c)(4) 

the results of its verification and the Secretary shall notify 

the Exchange of such results. Each person to whom the Secretary provided information under subsection (d) shall report 

to the Secretary in such manner as the Secretary determines 

appropriate. 

(2) VERIFICATION.— 

(A) ELIGIBILITY FOR ENROLLMENT AND PREMIUM TAX

CREDITS AND COST-SHARING REDUCTIONS.—If information 

provided by an applicant under paragraphs (1), (2), (3), 

and (4) of subsection (b) is verified under subsections (c) 

and (d)— 

(i) the individual’s eligibility to enroll through the 

Exchange and to apply for premium tax credits and 

cost-sharing reductions shall be satisfied; and 

(ii) the Secretary shall, if applicable, notify the 

Secretary of the Treasury under section 1412(c) of the 

amount of any advance payment to be made. 

(B) EXEMPTION FROM INDIVIDUAL RESPONSIBILITY.—If 

information provided by an applicant under subsection 

(b)(5) is verified under subsections (c) and (d), the Secretary 
H. R. 3590—110 

shall issue the certification of exemption described in section 1311(d)(4)(H). 

(3) INCONSISTENCIES INVOLVING ATTESTATION OF CITIZENSHIP OR LAWFUL PRESENCE.—If the information provided by 

any applicant under subsection (b)(2) is inconsistent with 

information in the records maintained by the Commissioner 

of Social Security or Secretary of Homeland Security, whichever 

is applicable, the applicant’s eligibility will be determined in 

the same manner as an individual’s eligibility under the medicaid program is determined under section 1902(ee) of the Social 

Security Act (as in effect on January 1, 2010). 

(4) INCONSISTENCIES INVOLVING OTHER INFORMATION.— 

(A) IN GENERAL.—If the information provided by an 

applicant under subsection (b) (other than subsection (b)(2)) 

is inconsistent with information in the records maintained 

by persons under subsection (c) or is not verified under 

subsection (d), the Secretary shall notify the Exchange 

and the Exchange shall take the following actions: 

(i) REASONABLE EFFORT.—The Exchange shall 

make a reasonable effort to identify and address the 

causes of such inconsistency, including through typographical or other clerical errors, by contacting the 

applicant to confirm the accuracy of the information, 

and by taking such additional actions as the Secretary, 

through regulation or other guidance, may identify. 

(ii) NOTICE AND OPPORTUNITY TO CORRECT.—In the 

case the inconsistency or inability to verify is not 

resolved under subparagraph (A), the Exchange shall— 

(I) notify the applicant of such fact; 

(II) provide the applicant an opportunity to 

either present satisfactory documentary evidence 

or resolve the inconsistency with the person 

verifying the information under subsection (c) or 

(d) during the 90-day period beginning the date 

on which the notice required under subclause (I) 

is sent to the applicant. 

The Secretary may extend the 90-day period under 

subclause (II) for enrollments occurring during 2014. 

(B) SPECIFIC ACTIONS NOT INVOLVING CITIZENSHIP OR

LAWFUL PRESENCE.— 

(i) IN GENERAL.—Except as provided in paragraph 

(3), the Exchange shall, during any period before the 

close of the period under subparagraph (A)(ii)(II), make 

any determination under paragraphs (2), (3), and (4) 

of subsection (a) on the basis of the information contained on the application. 

(ii) ELIGIBILITY OR AMOUNT OF CREDIT OR REDUC- TION.—If an inconsistency involving the eligibility for, 

or amount of, any premium tax credit or cost-sharing 

reduction is unresolved under this subsection as of 

the close of the period under subparagraph (A)(ii)(II), 

the Exchange shall notify the applicant of the amount 

(if any) of the credit or reduction that is determined 

on the basis of the records maintained by persons 

under subsection (c). 

(iii) EMPLOYER AFFORDABILITY.—If the Secretary 

notifies an Exchange that an enrollee is eligible for 
H. R. 3590—111 

a premium tax credit under section 36B of such Code 

or cost-sharing reduction under section 1402 because 

the enrollee’s (or related individual’s) employer does 

not provide minimum essential coverage through an 

employer-sponsored plan or that the employer does 

provide that coverage but it is not affordable coverage, 

the Exchange shall notify the employer of such fact 

and that the employer may be liable for the payment 

assessed under section 4980H of such Code. 

(iv) EXEMPTION.—In any case where the inconsistency involving, or inability to verify, information provided under subsection (b)(5) is not resolved as of the 

close of the period under subparagraph (A)(ii)(II), the 

Exchange shall notify an applicant that no certification 

of exemption from any requirement or payment under 

section 5000A of such Code will be issued. 

(C) APPEALS PROCESS.—The Exchange shall also notify 

each person receiving notice under this paragraph of the 

appeals processes established under subsection (f). 

(f) APPEALS AND REDETERMINATIONS.— 

(1) IN GENERAL.—The Secretary, in consultation with the 

Secretary of the Treasury, the Secretary of Homeland Security, 

and the Commissioner of Social Security, shall establish procedures by which the Secretary or one of such other Federal 

officers— 

(A) hears and makes decisions with respect to appeals 

of any determination under subsection (e); and 

(B) redetermines eligibility on a periodic basis in appropriate circumstances. 

(2) EMPLOYER LIABILITY.— (A) IN GENERAL.—The Secretary shall establish a separate appeals process for employers who are notified under 

subsection (e)(4)(C) that the employer may be liable for 

a tax imposed by section 4980H of the Internal Revenue 

Code of 1986 with respect to an employee because of a 

determination that the employer does not provide minimum 

essential coverage through an employer-sponsored plan or 

that the employer does provide that coverage but it is 

not affordable coverage with respect to an employee. Such 

process shall provide an employer the opportunity to— 

(i) present information to the Exchange for review 

of the determination either by the Exchange or the 

person making the determination, including evidence 

of the employer-sponsored plan and employer contributions to the plan; and 

(ii) have access to the data used to make the 

determination to the extent allowable by law. 

Such process shall be in addition to any rights of appeal 

the employer may have under subtitle F of such Code. 

(B) CONFIDENTIALITY.—Notwithstanding any provision 

of this title (or the amendments made by this title) or 

section 6103 of the Internal Revenue Code of 1986, an 

employer shall not be entitled to any taxpayer return 

information with respect to an employee for purposes of 

determining whether the employer is subject to the penalty 

under section 4980H of such Code with respect to the 

employee, except that— 
H. R. 3590—112 

(i) the employer may be notified as to the name 

of an employee and whether or not the employee’s 

income is above or below the threshold by which the 

affordability of an employer’s health insurance coverage is measured; and 

(ii) this subparagraph shall not apply to an 

employee who provides a waiver (at such time and 

in such manner as the Secretary may prescribe) 

authorizing an employer to have access to the 

employee’s taxpayer return information. 

(g) CONFIDENTIALITY OF APPLICANT INFORMATION.— 

(1) IN GENERAL.—An applicant for insurance coverage or 

for a premium tax credit or cost-sharing reduction shall be 

required to provide only the information strictly necessary to 

authenticate identity, determine eligibility, and determine the 

amount of the credit or reduction. 

(2) RECEIPT OF INFORMATION.—Any person who receives 

information provided by an applicant under subsection (b) 

(whether directly or by another person at the request of the 

applicant), or receives information from a Federal agency under 

subsection (c), (d), or (e), shall— 

(A) use the information only for the purposes of, and 

to the extent necessary in, ensuring the efficient operation 

of the Exchange, including verifying the eligibility of an 

individual to enroll through an Exchange or to claim a 

premium tax credit or cost-sharing reduction or the amount 

of the credit or reduction; and 

(B) not disclose the information to any other person 

except as provided in this section. 

(h) PENALTIES.— 

(1) FALSE OR FRAUDULENT INFORMATION.— 

(A) CIVIL PENALTY.— 

(i) IN GENERAL.—If— 

(I) any person fails to provides correct information under subsection (b); and 

(II) such failure is attributable to negligence 

or disregard of any rules or regulations of the 

Secretary, 

such person shall be subject, in addition to any other 

penalties that may be prescribed by law, to a civil 

penalty of not more than $25,000 with respect to any 

failures involving an application for a plan year. For 

purposes of this subparagraph, the terms ‘‘negligence’’ 

and ‘‘disregard’’ shall have the same meanings as when 

used in section 6662 of the Internal Revenue Code 

of 1986. 

(ii) REASONABLE CAUSE EXCEPTION.—No penalty 

shall be imposed under clause (i) if the Secretary determines that there was a reasonable cause for the failure 

and that the person acted in good faith. 

(B) KNOWING AND WILLFUL VIOLATIONS.—Any person 

who knowingly and willfully provides false or fraudulent 

information under subsection (b) shall be subject, in addition to any other penalties that may be prescribed by 

law, to a civil penalty of not more than $250,000. 
H. R. 3590—113 

(2) IMPROPER USE OR DISCLOSURE OF INFORMATION.—Any 

person who knowingly and willfully uses or discloses information in violation of subsection (g) shall be subject, in addition 

to any other penalties that may be prescribed by law, to a 

civil penalty of not more than $25,000. 

(3) LIMITATIONS ON LIENS AND LEVIES.—The Secretary (or, 

if applicable, the Attorney General of the United States) shall 

not— 

(A) file notice of lien with respect to any property 

of a person by reason of any failure to pay the penalty 

imposed by this subsection; or 

(B) levy on any such property with respect to such 

failure. 

(i) STUDY OF ADMINISTRATION OF EMPLOYER RESPONSIBILITY.— 

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

Services shall, in consultation with the Secretary of the 

Treasury, conduct a study of the procedures that are necessary 

to ensure that in the administration of this title and section 

4980H of the Internal Revenue Code of 1986 (as added by 

section 1513) that the following rights are protected: 

(A) The rights of employees to preserve their right 

to confidentiality of their taxpayer return information and 

their right to enroll in a qualified health plan through 

an Exchange if an employer does not provide affordable 

coverage. 

(B) The rights of employers to adequate due process 

and access to information necessary to accurately determine any payment assessed on employers. 

(2) REPORT.—Not later than January 1, 2013, the Secretary 

of Health and Human Services shall report the results of the 

study conducted under paragraph (1), including any recommendations for legislative changes, to the Committees on 

Finance and Health, Education, Labor and Pensions of the 

Senate and the Committees of Education and Labor and Ways 

and Means of the House of Representatives. 

SEC. 1412. ADVANCE DETERMINATION AND PAYMENT OF PREMIUM 

TAX CREDITS AND COST-SHARING REDUCTIONS. 

(a) IN GENERAL.—The Secretary, in consultation with the Secretary of the Treasury, shall establish a program under which— 

(1) upon request of an Exchange, advance determinations 

are made under section 1411 with respect to the income eligibility of individuals enrolling in a qualified health plan in 

the individual market through the Exchange for the premium 

tax credit allowable under section 36B of the Internal Revenue 

Code of 1986 and the cost-sharing reductions under section 

1402; 

(2) the Secretary notifies— 

(A) the Exchange and the Secretary of the Treasury 

of the advance determinations; and 

(B) the Secretary of the Treasury of the name and 

employer identification number of each employer with 

respect to whom 1 or more employee of the employer were 

determined to be eligible for the premium tax credit under 

section 36B of the Internal Revenue Code of 1986 and 

the cost-sharing reductions under section 1402 because— 
H. R. 3590—114 

(i) the employer did not provide minimum essential 

coverage; or 

(ii) the employer provided such minimum essential 

coverage but it was determined under section 

36B(c)(2)(C) of such Code to either be unaffordable 

to the employee or not provide the required minimum 

actuarial value; and 

(3) the Secretary of the Treasury makes advance payments 

of such credit or reductions to the issuers of the qualified 

health plans in order to reduce the premiums payable by 

individuals eligible for such credit. 

(b) ADVANCE DETERMINATIONS.— 

(1) IN GENERAL.—The Secretary shall provide under the 

program established under subsection (a) that advance determination of eligibility with respect to any individual shall be 

made— 

(A) during the annual open enrollment period 

applicable to the individual (or such other enrollment 

period as may be specified by the Secretary); and 

(B) on the basis of the individual’s household income 

for the most recent taxable year for which the Secretary, 

after consultation with the Secretary of the Treasury, determines information is available. 

(2) CHANGES IN CIRCUMSTANCES.—The Secretary shall provide procedures for making advance determinations on the 

basis of information other than that described in paragraph 

(1)(B) in cases where information included with an application 

form demonstrates substantial changes in income, changes in 

family size or other household circumstances, change in filing 

status, the filing of an application for unemployment benefits, 

or other significant changes affecting eligibility, including— 

(A) allowing an individual claiming a decrease of 20 

percent or more in income, or filing an application for 

unemployment benefits, to have eligibility for the credit 

determined on the basis of household income for a later 

period or on the basis of the individual’s estimate of such 

income for the taxable year; and 

(B) the determination of household income in cases 

where the taxpayer was not required to file a return of 

tax imposed by this chapter for the second preceding taxable year. 

(c) PAYMENT OF PREMIUM TAX CREDITS AND COST-SHARING

REDUCTIONS.— 

(1) IN GENERAL.—The Secretary shall notify the Secretary 

of the Treasury and the Exchange through which the individual 

is enrolling of the advance determination under section 1411. 

(2) PREMIUM TAX CREDIT.— 

(A) IN GENERAL.—The Secretary of the Treasury shall 

make the advance payment under this section of any premium tax credit allowed under section 36B of the Internal 

Revenue Code of 1986 to the issuer of a qualified health 

plan on a monthly basis (or such other periodic basis as 

the Secretary may provide). 

(B) ISSUER RESPONSIBILITIES.—An issuer of a qualified 

health plan receiving an advance payment with respect 

to an individual enrolled in the plan shall— 
H. R. 3590—115 

(i) reduce the premium charged the insured for 

any period by the amount of the advance payment 

for the period; 

(ii) notify the Exchange and the Secretary of such 

reduction; 

(iii) include with each billing statement the 

amount by which the premium for the plan has been 

reduced by reason of the advance payment; and 

(iv) in the case of any nonpayment of premiums 

by the insured— 

(I) notify the Secretary of such nonpayment; 

and 

(II) allow a 3-month grace period for nonpayment of premiums before discontinuing coverage. 

(3) COST-SHARING REDUCTIONS.—The Secretary shall also 

notify the Secretary of the Treasury and the Exchange under 

paragraph (1) if an advance payment of the cost-sharing reductions under section 1402 is to be made to the issuer of any 

qualified health plan with respect to any individual enrolled 

in the plan. The Secretary of the Treasury shall make such 

advance payment at such time and in such amount as the 

Secretary specifies in the notice. 

(d) NO FEDERAL PAYMENTS FOR INDIVIDUALS NOT LAWFULLY

PRESENT.—Nothing in this subtitle or the amendments made by 

this subtitle allows Federal payments, credits, or cost-sharing reductions for individuals who are not lawfully present in the United 

States. 

(e) STATE FLEXIBILITY.—Nothing in this subtitle or the amendments made by this subtitle shall be construed to prohibit a State 

from making payments to or on behalf of an individual for coverage 

under a qualified health plan offered through an Exchange that 

are in addition to any credits or cost-sharing reductions allowable 

to the individual under this subtitle and such amendments. 

SEC. 1413. STREAMLINING OF PROCEDURES FOR ENROLLMENT 

THROUGH AN EXCHANGE AND STATE MEDICAID, CHIP, 

AND HEALTH SUBSIDY PROGRAMS. 

(a) IN GENERAL.—The Secretary shall establish a system 

meeting the requirements of this section under which residents 

of each State may apply for enrollment in, receive a determination 

of eligibility for participation in, and continue participation in, 

applicable State health subsidy programs. Such system shall ensure 

that if an individual applying to an Exchange is found through 

screening to be eligible for medical assistance under the State 

medicaid plan under title XIX, or eligible for enrollment under 

a State children’s health insurance program (CHIP) under title 

XXI of such Act, the individual is enrolled for assistance under 

such plan or program. 

(b) REQUIREMENTS RELATING TO FORMS AND NOTICE.— 

(1) REQUIREMENTS RELATING TO FORMS.— 

(A) IN GENERAL.—The Secretary shall develop and provide to each State a single, streamlined form that— 

(i) may be used to apply for all applicable State 

health subsidy programs within the State; 

(ii) may be filed online, in person, by mail, or 

by telephone; 
H. R. 3590—116 

(iii) may be filed with an Exchange or with State 

officials operating one of the other applicable State 

health subsidy programs; and 

(iv) is structured to maximize an applicant’s ability 

to complete the form satisfactorily, taking into account 

the characteristics of individuals who qualify for 

applicable State health subsidy programs. 

(B) STATE AUTHORITY TO ESTABLISH FORM.—A State 

may develop and use its own single, streamlined form 

as an alternative to the form developed under subparagraph (A) if the alternative form is consistent with standards promulgated by the Secretary under this section. 

(C) SUPPLEMENTAL ELIGIBILITY FORMS.—The Secretary 

may allow a State to use a supplemental or alternative 

form in the case of individuals who apply for eligibility 

that is not determined on the basis of the household income 

(as defined in section 36B of the Internal Revenue Code 

of 1986). 

(2) NOTICE.—The Secretary shall provide that an applicant 

filing a form under paragraph (1) shall receive notice of eligibility for an applicable State health subsidy program without 

any need to provide additional information or paperwork unless 

such information or paperwork is specifically required by law 

when information provided on the form is inconsistent with 

data used for the electronic verification under paragraph (3) 

or is otherwise insufficient to determine eligibility. 

(c) REQUIREMENTS RELATING TO ELIGIBILITY BASED ON DATA

EXCHANGES.— (1) DEVELOPMENT OF SECURE INTERFACES.—Each State 

shall develop for all applicable State health subsidy programs 

a secure, electronic interface allowing an exchange of data 

(including information contained in the application forms 

described in subsection (b)) that allows a determination of 

eligibility for all such programs based on a single application. 

Such interface shall be compatible with the method established 

for data verification under section 1411(c)(4). 

(2) DATA MATCHING PROGRAM.—Each applicable State 

health subsidy program shall participate in a data matching 

arrangement for determining eligibility for participation in the 

program under paragraph (3) that— 

(A) provides access to data described in paragraph 

(3); 

(B) applies only to individuals who— 

(i) receive assistance from an applicable State 

health subsidy program; or 

(ii) apply for such assistance— 

(I) by filing a form described in subsection 

(b); or 

(II) by requesting a determination of eligibility 

and authorizing disclosure of the information 

described in paragraph (3) to applicable State 

health coverage subsidy programs for purposes of 

determining and establishing eligibility; and 

(C) consistent with standards promulgated by the Secretary, including the privacy and data security safeguards 

described in section 1942 of the Social Security Act or 

that are otherwise applicable to such programs. 
H. R. 3590—117 

(3) DETERMINATION OF ELIGIBILITY.— 

(A) IN GENERAL.—Each applicable State health subsidy 

program shall, to the maximum extent practicable— 

(i) establish, verify, and update eligibility for 

participation in the program using the data matching 

arrangement under paragraph (2); and 

(ii) determine such eligibility on the basis of reliable, third party data, including information described 

in sections 1137, 453(i), and 1942(a) of the Social Security Act, obtained through such arrangement. 

(B) EXCEPTION.—This paragraph shall not apply in 

circumstances with respect to which the Secretary determines that the administrative and other costs of use of 

the data matching arrangement under paragraph (2) outweigh its expected gains in accuracy, efficiency, and program participation. 

(4) SECRETARIAL STANDARDS.—The Secretary shall, after 

consultation with persons in possession of the data to be 

matched and representatives of applicable State health subsidy 

programs, promulgate standards governing the timing, contents, and procedures for data matching described in this subsection. Such standards shall take into account administrative 

and other costs and the value of data matching to the establishment, verification, and updating of eligibility for applicable 

State health subsidy programs. 

(d) ADMINISTRATIVE AUTHORITY.— 

(1) AGREEMENTS.—Subject to section 1411 and section 

6103(l)(21) of the Internal Revenue Code of 1986 and any 

other requirement providing safeguards of privacy and data 

integrity, the Secretary may establish model agreements, and 

enter into agreements, for the sharing of data under this section. 

(2) AUTHORITY OF EXCHANGE TO CONTRACT OUT.—Nothing 

in this section shall be construed to— 

(A) prohibit contractual arrangements through which 

a State medicaid agency determines eligibility for all 

applicable State health subsidy programs, but only if such 

agency complies with the Secretary’s requirements 

ensuring reduced administrative costs, eligibility errors, 

and disruptions in coverage; or 

(B) change any requirement under title XIX that eligibility for participation in a State’s medicaid program must 

be determined by a public agency. 

(e) APPLICABLE STATE HEALTH SUBSIDY PROGRAM.—In this section, the term ‘‘applicable State health subsidy program’’ means— 

(1) the program under this title for the enrollment in 

qualified health plans offered through an Exchange, including 

the premium tax credits under section 36B of the Internal 

Revenue Code of 1986 and cost-sharing reductions under section 

1402; 

(2) a State medicaid program under title XIX of the Social 

Security Act; 

(3) a State children’s health insurance program (CHIP) 

under title XXI of such Act; and 

(4) a State program under section 1331 establishing qualified basic health plans. 
H. R. 3590—118 

SEC. 1414. DISCLOSURES TO CARRY OUT ELIGIBILITY REQUIREMENTS 

FOR CERTAIN PROGRAMS. 

(a) DISCLOSURE OF TAXPAYER RETURN INFORMATION AND SOCIAL

SECURITY NUMBERS.— (1) TAXPAYER RETURN INFORMATION.—Subsection (l) of section 6103 of the Internal Revenue Code of 1986 is amended 

by adding at the end the following new paragraph: 

‘‘(21) DISCLOSURE OF RETURN INFORMATION TO CARRY OUT

ELIGIBILITY REQUIREMENTS FOR CERTAIN PROGRAMS.— ‘‘(A) IN GENERAL.—The Secretary, upon written request 

from the Secretary of Health and Human Services, shall 

disclose to officers, employees, and contractors of the 

Department of Health and Human Services return information of any taxpayer whose income is relevant in determining any premium tax credit under section 36B or any 

cost-sharing reduction under section 1402 of the Patient 

Protection and Affordable Care Act or eligibility for participation in a State medicaid program under title XIX of 

the Social Security Act, a State’s children’s health insurance program under title XXI of the Social Security Act, 

or a basic health program under section 1331 of Patient 

Protection and Affordable Care Act. Such return information shall be limited to— 

‘‘(i) taxpayer identity information with respect to 

such taxpayer, 

‘‘(ii) the filing status of such taxpayer, 

‘‘(iii) the number of individuals for whom a deduction is allowed under section 151 with respect to the 

taxpayer (including the taxpayer and the taxpayer’s 

spouse), 

‘‘(iv) the modified gross income (as defined in section 36B) of such taxpayer and each of the other 

individuals included under clause (iii) who are required 

to file a return of tax imposed by chapter 1 for the 

taxable year, 

‘‘(v) such other information as is prescribed by 

the Secretary by regulation as might indicate whether 

the taxpayer is eligible for such credit or reduction 

(and the amount thereof), and 

‘‘(vi) the taxable year with respect to which the 

preceding information relates or, if applicable, the fact 

that such information is not available. 

‘‘(B) INFORMATION TO EXCHANGE AND STATE AGENCIES.—The Secretary of Health and Human Services may 

disclose to an Exchange established under the Patient 

Protection and Affordable Care Act or its contractors, or 

to a State agency administering a State program described 

in subparagraph (A) or its contractors, any inconsistency 

between the information provided by the Exchange or State 

agency to the Secretary and the information provided to 

the Secretary under subparagraph (A). 

‘‘(C) RESTRICTION ON USE OF DISCLOSED INFORMATION.—Return information disclosed under subparagraph 

(A) or (B) may be used by officers, employees, and contractors of the Department of Health and Human Services, 

an Exchange, or a State agency only for the purposes 

of, and to the extent necessary in— 
H. R. 3590—119 

‘‘(i) establishing eligibility for participation in the 

Exchange, and verifying the appropriate amount of, 

any credit or reduction described in subparagraph (A), 

‘‘(ii) determining eligibility for participation in the 

State programs described in subparagraph (A).’’. 

(2) SOCIAL SECURITY NUMBERS.—Section 205(c)(2)(C) of the 

Social Security Act is amended by adding at the end the following new clause: 

‘‘(x) The Secretary of Health and Human Services, 

and the Exchanges established under section 1311 of 

the Patient Protection and Affordable Care Act, are 

authorized to collect and use the names and social 

security account numbers of individuals as required 

to administer the provisions of, and the amendments 

made by, the such Act.’’. 

(b) CONFIDENTIALITY AND DISCLOSURE.—Paragraph (3) of section 6103(a) of such Code is amended by striking ‘‘or (20)’’ and 

inserting ‘‘(20), or (21)’’. 

(c) PROCEDURES AND RECORDKEEPING RELATED TO DISCLOSURES.—Paragraph (4) of section 6103(p) of such Code is amended— 

(1) by inserting ‘‘, or any entity described in subsection 

(l)(21),’’ after ‘‘or (20)’’ in the matter preceding subparagraph 

(A), 

(2) by inserting ‘‘or any entity described in subsection 

(l)(21),’’ after ‘‘or (o)(1)(A)’’ in subparagraph (F)(ii), and 

(3) by inserting ‘‘or any entity described in subsection 

(l)(21),’’ after ‘‘or (20)’’ both places it appears in the matter 

after subparagraph (F). 

(d) UNAUTHORIZED DISCLOSURE OR INSPECTION.—Paragraph (2) 

of section 7213(a) of such Code is amended by striking ‘‘or (20)’’ 

and inserting ‘‘(20), or (21)’’. 

SEC. 1415. PREMIUM TAX CREDIT AND COST-SHARING REDUCTION 

PAYMENTS DISREGARDED FOR FEDERAL AND FEDERALLY-ASSISTED PROGRAMS. 

For purposes of determining the eligibility of any individual 

for benefits or assistance, or the amount or extent of benefits 

or assistance, under any Federal program or under any State or 

local program financed in whole or in part with Federal funds— 

(1) any credit or refund allowed or made to any individual 

by reason of section 36B of the Internal Revenue Code of 

1986 (as added by section 1401) shall not be taken into account 

as income and shall not be taken into account as resources 

for the month of receipt and the following 2 months; and 

(2) any cost-sharing reduction payment or advance payment 

of the credit allowed under such section 36B that is made 

under section 1402 or 1412 shall be treated as made to the 

qualified health plan in which an individual is enrolled and 

not to that individual. 

PART II—SMALL BUSINESS TAX CREDIT 

SEC. 1421. CREDIT FOR EMPLOYEE HEALTH INSURANCE EXPENSES 

OF SMALL BUSINESSES. 

(a) IN GENERAL.—Subpart D of part IV of subchapter A of 

chapter 1 of the Internal Revenue Code of 1986 (relating to business- 
H. R. 3590—120 

related credits) is amended by inserting after section 45Q the following: 

‘‘SEC. 45R. EMPLOYEE HEALTH INSURANCE EXPENSES OF SMALL 

EMPLOYERS. 

‘‘(a) GENERAL RULE.—For purposes of section 38, in the case 

of an eligible small employer, the small employer health insurance 

credit determined under this section for any taxable year in the 

credit period is the amount determined under subsection (b). 

‘‘(b) HEALTH INSURANCE CREDIT AMOUNT.—Subject to subsection (c), the amount determined under this subsection with 

respect to any eligible small employer is equal to 50 percent (35 

percent in the case of a tax-exempt eligible small employer) of 

the lesser of— 

‘‘(1) the aggregate amount of nonelective contributions the 

employer made on behalf of its employees during the taxable 

year under the arrangement described in subsection (d)(4) for 

premiums for qualified health plans offered by the employer 

to its employees through an Exchange, or 

‘‘(2) the aggregate amount of nonelective contributions 

which the employer would have made during the taxable year 

under the arrangement if each employee taken into account 

under paragraph (1) had enrolled in a qualified health plan 

which had a premium equal to the average premium (as determined by the Secretary of Health and Human Services) for 

the small group market in the rating area in which the 

employee enrolls for coverage. 

‘‘(c) PHASEOUT OF CREDIT AMOUNT BASED ON NUMBER OF

EMPLOYEES AND AVERAGE WAGES.—The amount of the credit determined under subsection (b) without regard to this subsection shall 

be reduced (but not below zero) by the sum of the following amounts: 

‘‘(1) Such amount multiplied by a fraction the numerator 

of which is the total number of full-time equivalent employees 

of the employer in excess of 10 and the denominator of which 

is 15. 

‘‘(2) Such amount multiplied by a fraction the numerator 

of which is the average annual wages of the employer in excess 

of the dollar amount in effect under subsection (d)(3)(B) and 

the denominator of which is such dollar amount. 

‘‘(d) ELIGIBLE SMALL EMPLOYER.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘eligible small employer’ 

means, with respect to any taxable year, an employer— 

‘‘(A) which has no more than 25 full-time equivalent 

employees for the taxable year, 

‘‘(B) the average annual wages of which do not exceed 

an amount equal to twice the dollar amount in effect under 

paragraph (3)(B) for the taxable year, and 

‘‘(C) which has in effect an arrangement described 

in paragraph (4). 

‘‘(2) FULL-TIME EQUIVALENT EMPLOYEES.— 

‘‘(A) IN GENERAL.—The term ‘full-time equivalent 

employees’ means a number of employees equal to the 

number determined by dividing— 

‘‘(i) the total number of hours of service for which 

wages were paid by the employer to employees during 

the taxable year, by 

‘‘(ii) 2,080. 
H. R. 3590—121 

Such number shall be rounded to the next lowest whole 

number if not otherwise a whole number. 

‘‘(B) EXCESS HOURS NOT COUNTED.—If an employee 

works in excess of 2,080 hours of service during any taxable 

year, such excess shall not be taken into account under 

subparagraph (A). 

‘‘(C) HOURS OF SERVICE.—The Secretary, in consultation with the Secretary of Labor, shall prescribe such regulations, rules, and guidance as may be necessary to determine the hours of service of an employee, including rules 

for the application of this paragraph to employees who 

are not compensated on an hourly basis. 

‘‘(3) AVERAGE ANNUAL WAGES.— 

‘‘(A) IN GENERAL.—The average annual wages of an 

eligible small employer for any taxable year is the amount 

determined by dividing— 

‘‘(i) the aggregate amount of wages which were 

paid by the employer to employees during the taxable 

year, by 

‘‘(ii) the number of full-time equivalent employees 

of the employee determined under paragraph (2) for 

the taxable year. 

Such amount shall be rounded to the next lowest multiple 

of $1,000 if not otherwise such a multiple. 

‘‘(B) DOLLAR AMOUNT.—For purposes of paragraph 

(1)(B)— 

‘‘(i) 2011, 2012, AND 2013.—The dollar amount in 

effect under this paragraph for taxable years beginning 

in 2011, 2012, or 2013 is $20,000. 

‘‘(ii) SUBSEQUENT YEARS.—In the case of a taxable 

year beginning in a calendar year after 2013, the dollar 

amount in effect under this paragraph shall be equal 

to $20,000, multiplied by the cost-of-living adjustment 

determined under section 1(f)(3) for the calendar year, 

determined by substituting ‘calendar year 2012’ for 

‘calendar year 1992’ in subparagraph (B) thereof. 

‘‘(4) CONTRIBUTION ARRANGEMENT.—An arrangement is 

described in this paragraph if it requires an eligible small 

employer to make a nonelective contribution on behalf of each 

employee who enrolls in a qualified health plan offered to 

employees by the employer through an exchange in an amount 

equal to a uniform percentage (not less than 50 percent) of 

the premium cost of the qualified health plan. 

‘‘(5) SEASONAL WORKER HOURS AND WAGES NOT COUNTED.— 

For purposes of this subsection— 

‘‘(A) IN GENERAL.—The number of hours of service 

worked by, and wages paid to, a seasonal worker of an 

employer shall not be taken into account in determining 

the full-time equivalent employees and average annual 

wages of the employer unless the worker works for the 

employer on more than 120 days during the taxable year. 

‘‘(B) DEFINITION OF SEASONAL WORKER.—The term ‘seasonal worker’ means a worker who performs labor or services on a seasonal basis as defined by the Secretary of 

Labor, including workers covered by section 500.20(s)(1) 

of title 29, Code of Federal Regulations and retail workers 

employed exclusively during holiday seasons. 
H. R. 3590—122 

‘‘(e) OTHER RULES AND DEFINITIONS.—For purposes of this section— 

‘‘(1) EMPLOYEE.— 

‘‘(A) CERTAIN EMPLOYEES EXCLUDED.—The term 

‘employee’ shall not include— 

‘‘(i) an employee within the meaning of section 

401(c)(1), 

‘‘(ii) any 2-percent shareholder (as defined in section 1372(b)) of an eligible small business which is 

an S corporation, 

‘‘(iii) any 5-percent owner (as defined in section 

416(i)(1)(B)(i)) of an eligible small business, or 

‘‘(iv) any individual who bears any of the relationships described in subparagraphs (A) through (G) of 

section 152(d)(2) to, or is a dependent described in 

section 152(d)(2)(H) of, an individual described in 

clause (i), (ii), or (iii). 

‘‘(B) LEASED EMPLOYEES.—The term ‘employee’ shall 

include a leased employee within the meaning of section 

414(n). 

‘‘(2) CREDIT PERIOD.—The term ‘credit period’ means, with 

respect to any eligible small employer, the 2-consecutive-taxable 

year period beginning with the 1st taxable year in which the 

employer (or any predecessor) offers 1 or more qualified health 

plans to its employees through an Exchange. 

‘‘(3) NONELECTIVE CONTRIBUTION.—The term ‘nonelective 

contribution’ means an employer contribution other than an 

employer contribution pursuant to a salary reduction arrangement. 

‘‘(4) WAGES.—The term ‘wages’ has the meaning given such 

term by section 3121(a) (determined without regard to any 

dollar limitation contained in such section). 

‘‘(5) AGGREGATION AND OTHER RULES MADE APPLICABLE.— 

‘‘(A) AGGREGATION RULES.—All employers treated as 

a single employer under subsection (b), (c), (m), or (o) 

of section 414 shall be treated as a single employer for 

purposes of this section. 

‘‘(B) OTHER RULES.—Rules similar to the rules of subsections (c), (d), and (e) of section 52 shall apply. 

‘‘(f) CREDIT MADE AVAILABLE TO TAX-EXEMPT ELIGIBLE SMALL

EMPLOYERS.— 

‘‘(1) IN GENERAL.—In the case of a tax-exempt eligible small 

employer, there shall be treated as a credit allowable under 

subpart C (and not allowable under this subpart) the lesser 

of— 

‘‘(A) the amount of the credit determined under this 

section with respect to such employer, or 

‘‘(B) the amount of the payroll taxes of the employer 

during the calendar year in which the taxable year begins. 

‘‘(2) TAX-EXEMPT ELIGIBLE SMALL EMPLOYER.—For purposes 

of this section, the term ‘tax-exempt eligible small employer’ 

means an eligible small employer which is any organization 

described in section 501(c) which is exempt from taxation under 

section 501(a). 

‘‘(3) PAYROLL TAXES.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘payroll taxes’ means— 
H. R. 3590—123 

‘‘(i) amounts required to be withheld from the 

employees of the tax-exempt eligible small employer 

under section 3401(a), 

‘‘(ii) amounts required to be withheld from such 

employees under section 3101(b), and 

‘‘(iii) amounts of the taxes imposed on the taxexempt eligible small employer under section 3111(b). 

‘‘(B) SPECIAL RULE.—A rule similar to the rule of section 24(d)(2)(C) shall apply for purposes of subparagraph 

(A). 

‘‘(g) APPLICATION OF SECTION FOR CALENDAR YEARS 2011, 2012, 

AND 2013.—In the case of any taxable year beginning in 2011, 

2012, or 2013, the following modifications to this section shall 

apply in determining the amount of the credit under subsection 

(a): 

‘‘(1) NO CREDIT PERIOD REQUIRED.—The credit shall be 

determined without regard to whether the taxable year is in 

a credit period and for purposes of applying this section to 

taxable years beginning after 2013, no credit period shall be 

treated as beginning with a taxable year beginning before 2014. 

‘‘(2) AMOUNT OF CREDIT.—The amount of the credit determined under subsection (b) shall be determined— 

‘‘(A) by substituting ‘35 percent (25 percent in the 

case of a tax-exempt eligible small employer)’ for ‘50 percent 

(35 percent in the case of a tax-exempt eligible small 

employer)’, 

‘‘(B) by reference to an eligible small employer’s nonelective contributions for premiums paid for health insurance coverage (within the meaning of section 9832(b)(1)) 

of an employee, and 

‘‘(C) by substituting for the average premium determined under subsection (b)(2) the amount the Secretary 

of Health and Human Services determines is the average 

premium for the small group market in the State in which 

the employer is offering health insurance coverage (or for 

such area within the State as is specified by the Secretary). 

‘‘(3) CONTRIBUTION ARRANGEMENT.—An arrangement shall 

not fail to meet the requirements of subsection (d)(4) solely 

because it provides for the offering of insurance outside of 

an Exchange. 

‘‘(h) INSURANCE DEFINITIONS.—Any term used in this section 

which is also used in the Public Health Service Act or subtitle 

A of title I of the Patient Protection and Affordable Care Act 

shall have the meaning given such term by such Act or subtitle. 

‘‘(i) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to carry out the provisions of this section, 

including regulations to prevent the avoidance of the 2-year limit 

on the credit period through the use of successor entities and 

the avoidance of the limitations under subsection (c) through the 

use of multiple entities.’’. 

(b) CREDIT TO BE PART OF GENERAL BUSINESS CREDIT.—Section 

38(b) of the Internal Revenue Code of 1986 (relating to current 

year business credit) is amended by striking ‘‘plus’’ at the end 

of paragraph (34), by striking the period at the end of paragraph 

(35) and inserting ‘‘, plus’’, and by inserting after paragraph (35) 

the following: 
H. R. 3590—124 

‘‘(36) the small employer health insurance credit determined under section 45R.’’. 

(c) CREDIT ALLOWED AGAINST ALTERNATIVE MINIMUM TAX.— Section 38(c)(4)(B) of the Internal Revenue Code of 1986 (defining 

specified credits) is amended by redesignating clauses (vi), (vii), 

and (viii) as clauses (vii), (viii), and (ix), respectively, and by 

inserting after clause (v) the following new clause: 

‘‘(vi) the credit determined under section 45R,’’. 

(d) DISALLOWANCE OF DEDUCTION FOR CERTAIN EXPENSES FOR

WHICH CREDIT ALLOWED.— (1) IN GENERAL.—Section 280C of the Internal Revenue 

Code of 1986 (relating to disallowance of deduction for certain 

expenses for which credit allowed), as amended by section 

1401(b), is amended by adding at the end the following new 

subsection: 

‘‘(h) CREDIT FOR EMPLOYEE HEALTH INSURANCE EXPENSES OF

SMALL EMPLOYERS.—No deduction shall be allowed for that portion 

of the premiums for qualified health plans (as defined in section 

1301(a) of the Patient Protection and Affordable Care Act), or 

for health insurance coverage in the case of taxable years beginning 

in 2011, 2012, or 2013, paid by an employer which is equal to 

the amount of the credit determined under section 45R(a) with 

respect to the premiums.’’. 

(2) DEDUCTION FOR EXPIRING CREDITS.—Section 196(c) of 

such Code is amended by striking ‘‘and’’ at the end of paragraph 

(12), by striking the period at the end of paragraph (13) and 

inserting ‘‘, and’’, and by adding at the end the following new 

paragraph: 

‘‘(14) the small employer health insurance credit determined under section 45R(a).’’. 

(e) CLERICAL AMENDMENT.—The table of sections for subpart 

D of part IV of subchapter A of chapter 1 of the Internal Revenue 

Code of 1986 is amended by adding at the end the following: 

‘‘Sec. 45R. Employee health insurance expenses of small employers.’’. 

(f) EFFECTIVE DATES.— 

(1) IN GENERAL.—The amendments made by this section 

shall apply to amounts paid or incurred in taxable years beginning after December 31, 2010. 

(2) MINIMUM TAX.—The amendments made by subsection 

(c) shall apply to credits determined under section 45R of 

the Internal Revenue Code of 1986 in taxable years beginning 

after December 31, 2010, and to carrybacks of such credits. 

Subtitle F—Shared Responsibility for 

Health Care 

PART I—INDIVIDUAL RESPONSIBILITY 

SEC. 1501. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE. 

(a) FINDINGS.—Congress makes the following findings: 

(1) IN GENERAL.—The individual responsibility requirement 

provided for in this section (in this subsection referred to as 

the ‘‘requirement’’) is commercial and economic in nature, and 

substantially affects interstate commerce, as a result of the 

effects described in paragraph (2). 
H. R. 3590—125 

(2) EFFECTS ON THE NATIONAL ECONOMY AND INTERSTATE

COMMERCE.—The effects described in this paragraph are the 

following: 

(A) The requirement regulates activity that is commercial and economic in nature: economic and financial 

decisions about how and when health care is paid for, 

and when health insurance is purchased. 

(B) Health insurance and health care services are a 

significant part of the national economy. National health 

spending is projected to increase from $2,500,000,000,000, 

or 17.6 percent of the economy, in 2009 to 

$4,700,000,000,000 in 2019. Private health insurance 

spending is projected to be $854,000,000,000 in 2009, and 

pays for medical supplies, drugs, and equipment that are 

shipped in interstate commerce. Since most health insurance is sold by national or regional health insurance companies, health insurance is sold in interstate commerce and 

claims payments flow through interstate commerce. 

(C) The requirement, together with the other provisions 

of this Act, will add millions of new consumers to the 

health insurance market, increasing the supply of, and 

demand for, health care services. According to the Congressional Budget Office, the requirement will increase the 

number and share of Americans who are insured. 

(D) The requirement achieves near-universal coverage 

by building upon and strengthening the private employerbased health insurance system, which covers 176,000,000 

Americans nationwide. In Massachusetts, a similar requirement has strengthened private employer-based coverage: 

despite the economic downturn, the number of workers 

offered employer-based coverage has actually increased. 

(E) Half of all personal bankruptcies are caused in 

part by medical expenses. By significantly increasing health 

insurance coverage, the requirement, together with the 

other provisions of this Act, will improve financial security 

for families. 

(F) Under the Employee Retirement Income Security 

Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health 

Service Act (42 U.S.C. 201 et seq.), and this Act, the Federal 

Government has a significant role in regulating health 

insurance which is in interstate commerce. 

(G) Under sections 2704 and 2705 of the Public Health 

Service Act (as added by section 1201 of this Act), if there 

were no requirement, many individuals would wait to purchase health insurance until they needed care. By significantly increasing health insurance coverage, the requirement, together with the other provisions of this Act, will 

minimize this adverse selection and broaden the health 

insurance risk pool to include healthy individuals, which 

will lower health insurance premiums. The requirement 

is essential to creating effective health insurance markets 

in which improved health insurance products that are 

guaranteed issue and do not exclude coverage of preexisting conditions can be sold. 

(H) Administrative costs for private health insurance, which were $90,000,000,000 in 2006, are 26 to 30 percent 

of premiums in the current individual and small group 
H. R. 3590—126 

markets. By significantly increasing health insurance coverage and the size of purchasing pools, which will increase 

economies of scale, the requirement, together with the other 

provisions of this Act, will significantly reduce administrative costs and lower health insurance premiums. The 

requirement is essential to creating effective health insurance markets that do not require underwriting and eliminate its associated administrative costs. 

(3) SUPREME COURT RULING.—In United States v. SouthEastern Underwriters Association (322 U.S. 533 (1944)), the 

Supreme Court of the United States ruled that insurance is 

interstate commerce subject to Federal regulation. 

(b) IN GENERAL.—Subtitle D of the Internal Revenue Code 

of 1986 is amended by adding at the end the following new chapter: 

‘‘CHAPTER 48—MAINTENANCE OF MINIMUM ESSENTIAL 

COVERAGE 

‘‘Sec. 5000A. Requirement to maintain minimum essential coverage. 

‘‘SEC. 5000A. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE. 

‘‘(a) REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE.—An applicable individual shall for each month beginning 

after 2013 ensure that the individual, and any dependent of the 

individual who is an applicable individual, is covered under minimum essential coverage for such month. 

‘‘(b) SHARED RESPONSIBILITY PAYMENT.— ‘‘(1) IN GENERAL.—If an applicable individual fails to meet 

the requirement of subsection (a) for 1 or more months during 

any calendar year beginning after 2013, then, except as provided in subsection (d), there is hereby imposed a penalty 

with respect to the individual in the amount determined under 

subsection (c). 

‘‘(2) INCLUSION WITH RETURN.—Any penalty imposed by 

this section with respect to any month shall be included with 

a taxpayer’s return under chapter 1 for the taxable year which 

includes such month. 

‘‘(3) PAYMENT OF PENALTY.—If an individual with respect 

to whom a penalty is imposed by this section for any month— 

‘‘(A) is a dependent (as defined in section 152) of 

another taxpayer for the other taxpayer’s taxable year 

including such month, such other taxpayer shall be liable 

for such penalty, or 

‘‘(B) files a joint return for the taxable year including 

such month, such individual and the spouse of such individual shall be jointly liable for such penalty. 

‘‘(c) AMOUNT OF PENALTY.— ‘‘(1) IN GENERAL.—The penalty determined under this subsection for any month with respect to any individual is an 

amount equal to 1⁄12 of the applicable dollar amount for the 

calendar year. 

‘‘(2) DOLLAR LIMITATION.—The amount of the penalty 

imposed by this section on any taxpayer for any taxable year 

with respect to all individuals for whom the taxpayer is liable 

under subsection (b)(3) shall not exceed an amount equal to 

300 percent the applicable dollar amount (determined without 
H. R. 3590—127 

regard to paragraph (3)(C)) for the calendar year with or within 

which the taxable year ends. 

‘‘(3) APPLICABLE DOLLAR AMOUNT.—For purposes of paragraph (1)— 

‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B) and (C), the applicable dollar amount is $750. 

‘‘(B) PHASE IN.—The applicable dollar amount is $95 

for 2014 and $350 for 2015. 

‘‘(C) SPECIAL RULE FOR INDIVIDUALS UNDER AGE 18.— 

If an applicable individual has not attained the age of 

18 as of the beginning of a month, the applicable dollar 

amount with respect to such individual for the month shall 

be equal to one-half of the applicable dollar amount for 

the calendar year in which the month occurs. 

‘‘(D) INDEXING OF AMOUNT.—In the case of any calendar 

year beginning after 2016, the applicable dollar amount 

shall be equal to $750, increased by an amount equal 

to— 

‘‘(i) $750, multiplied by 

‘‘(ii) the cost-of-living adjustment determined 

under section 1(f)(3) for the calendar year, determined 

by substituting ‘calendar year 2015’ for ‘calendar year 

1992’ in subparagraph (B) thereof. 

If the amount of any increase under clause (i) is not a 

multiple of $50, such increase shall be rounded to the 

next lowest multiple of $50. 

‘‘(4) TERMS RELATING TO INCOME AND FAMILIES.—For purposes of this section— 

‘‘(A) FAMILY SIZE.—The family size involved with 

respect to any taxpayer shall be equal to the number of 

individuals for whom the taxpayer is allowed a deduction 

under section 151 (relating to allowance of deduction for 

personal exemptions) for the taxable year. 

‘‘(B) HOUSEHOLD INCOME.—The term ‘household 

income’ means, with respect to any taxpayer for any taxable 

year, an amount equal to the sum of— 

‘‘(i) the modified gross income of the taxpayer, 

plus 

‘‘(ii) the aggregate modified gross incomes of all 

other individuals who— 

‘‘(I) were taken into account in determining 

the taxpayer’s family size under paragraph (1), 

and 

‘‘(II) were required to file a return of tax 

imposed by section 1 for the taxable year. 

‘‘(C) MODIFIED GROSS INCOME.—The term ‘modified 

gross income’ means gross income— 

‘‘(i) decreased by the amount of any deduction 

allowable under paragraph (1), (3), (4), or (10) of section 

62(a), 

‘‘(ii) increased by the amount of interest received 

or accrued during the taxable year which is exempt 

from tax imposed by this chapter, and 

‘‘(iii) determined without regard to sections 911, 

931, and 933. 

‘‘(D) POVERTY LINE.— 
H. R. 3590—128 

‘‘(i) IN GENERAL.—The term ‘poverty line’ has the 

meaning given that term in section 2110(c)(5) of the 

Social Security Act (42 U.S.C. 1397jj(c)(5)). 

‘‘(ii) POVERTY LINE USED.—In the case of any taxable year ending with or within a calendar year, the 

poverty line used shall be the most recently published 

poverty line as of the 1st day of such calendar year. 

‘‘(d) APPLICABLE INDIVIDUAL.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘applicable individual’ means, 

with respect to any month, an individual other than an individual described in paragraph (2), (3), or (4). 

‘‘(2) RELIGIOUS EXEMPTIONS.— 

‘‘(A) RELIGIOUS CONSCIENCE EXEMPTION.—Such term 

shall not include any individual for any month if such 

individual has in effect an exemption under section 

1311(d)(4)(H) of the Patient Protection and Affordable Care 

Act which certifies that such individual is a member of 

a recognized religious sect or division thereof described 

in section 1402(g)(1) and an adherent of established tenets 

or teachings of such sect or division as described in such 

section. 

‘‘(B) HEALTH CARE SHARING MINISTRY.— 

‘‘(i) IN GENERAL.—Such term shall not include any 

individual for any month if such individual is a member 

of a health care sharing ministry for the month. 

‘‘(ii) HEALTH CARE SHARING MINISTRY.—The term 

‘health care sharing ministry’ means an organization— 

‘‘(I) which is described in section 501(c)(3) and 

is exempt from taxation under section 501(a), 

‘‘(II) members of which share a common set 

of ethical or religious beliefs and share medical 

expenses among members in accordance with those 

beliefs and without regard to the State in which 

a member resides or is employed, 

‘‘(III) members of which retain membership 

even after they develop a medical condition, 

‘‘(IV) which (or a predecessor of which) has 

been in existence at all times since December 31, 

1999, and medical expenses of its members have 

been shared continuously and without interruption 

since at least December 31, 1999, and 

‘‘(V) which conducts an annual audit which 

is performed by an independent certified public 

accounting firm in accordance with generally 

accepted accounting principles and which is made 

available to the public upon request. 

‘‘(3) INDIVIDUALS NOT LAWFULLY PRESENT.—Such term shall 

not include an individual for any month if for the month the 

individual is not a citizen or national of the United States 

or an alien lawfully present in the United States. 

‘‘(4) INCARCERATED INDIVIDUALS.—Such term shall not 

include an individual for any month if for the month the individual is incarcerated, other than incarceration pending the 

disposition of charges. 

‘‘(e) EXEMPTIONS.—No penalty shall be imposed under subsection (a) with respect to— 

‘‘(1) INDIVIDUALS WHO CANNOT AFFORD COVERAGE.— 
H. R. 3590—129 

‘‘(A) IN GENERAL.—Any applicable individual for any 

month if the applicable individual’s required contribution 

(determined on an annual basis) for coverage for the month 

exceeds 8 percent of such individual’s household income 

for the taxable year described in section 1412(b)(1)(B) of 

the Patient Protection and Affordable Care Act. For purposes of applying this subparagraph, the taxpayer’s household income shall be increased by any exclusion from gross 

income for any portion of the required contribution made 

through a salary reduction arrangement. 

‘‘(B) REQUIRED CONTRIBUTION.—For purposes of this 

paragraph, the term ‘required contribution’ means— 

‘‘(i) in the case of an individual eligible to purchase 

minimum essential coverage consisting of coverage 

through an eligible-employer-sponsored plan, the portion of the annual premium which would be paid by 

the individual (without regard to whether paid through 

salary reduction or otherwise) for self-only coverage, 

or 

‘‘(ii) in the case of an individual eligible only to 

purchase minimum essential coverage described in subsection (f)(1)(C), the annual premium for the lowest 

cost bronze plan available in the individual market 

through the Exchange in the State in the rating area 

in which the individual resides (without regard to 

whether the individual purchased a qualified health 

plan through the Exchange), reduced by the amount 

of the credit allowable under section 36B for the taxable year (determined as if the individual was covered 

by a qualified health plan offered through the 

Exchange for the entire taxable year). 

‘‘(C) SPECIAL RULES FOR INDIVIDUALS RELATED TO

EMPLOYEES.—For purposes of subparagraph (B)(i), if an 

applicable individual is eligible for minimum essential coverage through an employer by reason of a relationship 

to an employee, the determination shall be made by reference to the affordability of the coverage to the employee. 

‘‘(D) INDEXING.—In the case of plan years beginning 

in any calendar year after 2014, subparagraph (A) shall 

be applied by substituting for ‘8 percent’ the percentage 

the Secretary of Health and Human Services determines 

reflects the excess of the rate of premium growth between 

the preceding calendar year and 2013 over the rate of 

income growth for such period. 

‘‘(2) TAXPAYERS WITH INCOME UNDER 100 PERCENT OF POVERTY LINE.—Any applicable individual for any month during 

a calendar year if the individual’s household income for the 

taxable year described in section 1412(b)(1)(B) of the Patient 

Protection and Affordable Care Act is less than 100 percent 

of the poverty line for the size of the family involved (determined in the same manner as under subsection (b)(4)). 

‘‘(3) MEMBERS OF INDIAN TRIBES.—Any applicable individual 

for any month during which the individual is a member of 

an Indian tribe (as defined in section 45A(c)(6)). 

‘‘(4) MONTHS DURING SHORT COVERAGE GAPS.— ‘‘(A) IN GENERAL.—Any month the last day of which 

occurred during a period in which the applicable individual 
H. R. 3590—130 

was not covered by minimum essential coverage for a 

continuous period of less than 3 months. 

‘‘(B) SPECIAL RULES.—For purposes of applying this 

paragraph— 

‘‘(i) the length of a continuous period shall be determined without regard to the calendar years in which 

months in such period occur, 

‘‘(ii) if a continuous period is greater than the 

period allowed under subparagraph (A), no exception 

shall be provided under this paragraph for any month 

in the period, and 

‘‘(iii) if there is more than 1 continuous period 

described in subparagraph (A) covering months in a 

calendar year, the exception provided by this paragraph shall only apply to months in the first of such 

periods. 

The Secretary shall prescribe rules for the collection of 

the penalty imposed by this section in cases where continuous periods include months in more than 1 taxable year. 

‘‘(5) HARDSHIPS.—Any applicable individual who for any 

month is determined by the Secretary of Health and Human 

Services under section 1311(d)(4)(H) to have suffered a hardship 

with respect to the capability to obtain coverage under a qualified health plan. 

‘‘(f) MINIMUM ESSENTIAL COVERAGE.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘minimum essential coverage’ 

means any of the following: 

‘‘(A) GOVERNMENT SPONSORED PROGRAMS.—Coverage 

under— 

‘‘(i) the Medicare program under part A of title 

XVIII of the Social Security Act, 

‘‘(ii) the Medicaid program under title XIX of the 

Social Security Act, 

‘‘(iii) the CHIP program under title XXI of the 

Social Security Act, 

‘‘(iv) the TRICARE for Life program, 

‘‘(v) the veteran’s health care program under 

chapter 17 of title 38, United States Code, or 

‘‘(vi) a health plan under section 2504(e) of title 

22, United States Code (relating to Peace Corps volunteers). 

‘‘(B) EMPLOYER-SPONSORED PLAN.—Coverage under an 

eligible employer-sponsored plan. 

‘‘(C) PLANS IN THE INDIVIDUAL MARKET.—Coverage 

under a health plan offered in the individual market within 

a State. 

‘‘(D) GRANDFATHERED HEALTH PLAN.—Coverage under 

a grandfathered health plan. 

‘‘(E) OTHER COVERAGE.—Such other health benefits coverage, such as a State health benefits risk pool, as the 

Secretary of Health and Human Services, in coordination 

with the Secretary, recognizes for purposes of this subsection. 

‘‘(2) ELIGIBLE EMPLOYER-SPONSORED PLAN.—The term 

‘eligible employer-sponsored plan’ means, with respect to any 
H. R. 3590—131 

employee, a group health plan or group health insurance coverage offered by an employer to the employee which is— 

‘‘(A) a governmental plan (within the meaning of section 2791(d)(8) of the Public Health Service Act), or 

‘‘(B) any other plan or coverage offered in the small 

or large group market within a State. 

Such term shall include a grandfathered health plan described 

in paragraph (1)(D) offered in a group market. 

‘‘(3) EXCEPTED BENEFITS NOT TREATED AS MINIMUM ESSENTIAL COVERAGE.—The term ‘minimum essential coverage’ shall 

not include health insurance coverage which consists of coverage of excepted benefits— 

‘‘(A) described in paragraph (1) of subsection (c) of 

section 2791 of the Public Health Service Act; or 

‘‘(B) described in paragraph (2), (3), or (4) of such 

subsection if the benefits are provided under a separate 

policy, certificate, or contract of insurance. 

‘‘(4) INDIVIDUALS RESIDING OUTSIDE UNITED STATES OR RESIDENTS OF TERRITORIES.—Any applicable individual shall be 

treated as having minimum essential coverage for any month— 

‘‘(A) if such month occurs during any period described 

in subparagraph (A) or (B) of section 911(d)(1) which is 

applicable to the individual, or 

‘‘(B) if such individual is a bona fide resident of any 

possession of the United States (as determined under section 937(a)) for such month. 

‘‘(5) INSURANCE-RELATED TERMS.—Any term used in this 

section which is also used in title I of the Patient Protection 

and Affordable Care Act shall have the same meaning as when 

used in such title. 

‘‘(g) ADMINISTRATION AND PROCEDURE.— 

‘‘(1) IN GENERAL.—The penalty provided by this section 

shall be paid upon notice and demand by the Secretary, and 

except as provided in paragraph (2), shall be assessed and 

collected in the same manner as an assessable penalty under 

subchapter B of chapter 68. 

‘‘(2) SPECIAL RULES.—Notwithstanding any other provision 

of law— 

‘‘(A) WAIVER OF CRIMINAL PENALTIES.—In the case of 

any failure by a taxpayer to timely pay any penalty imposed 

by this section, such taxpayer shall not be subject to any 

criminal prosecution or penalty with respect to such failure. 

‘‘(B) LIMITATIONS ON LIENS AND LEVIES.—The Secretary 

shall not— 

‘‘(i) file notice of lien with respect to any property 

of a taxpayer by reason of any failure to pay the 

penalty imposed by this section, or 

‘‘(ii) levy on any such property with respect to 

such failure.’’. 

(c) CLERICAL AMENDMENT.—The table of chapters for subtitle 

D of the Internal Revenue Code of 1986 is amended by inserting 

after the item relating to chapter 47 the following new item: 

‘‘CHAPTER 48—MAINTENANCE OF MINIMUM ESSENTIAL COVERAGE.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years ending after December 31, 2013. 
H. R. 3590—132 

SEC. 1502. REPORTING OF HEALTH INSURANCE COVERAGE. 

(a) IN GENERAL.—Part III of subchapter A of chapter 61 of 

the Internal Revenue Code of 1986 is amended by inserting after 

subpart C the following new subpart: 

‘‘Subpart D—Information Regarding Health 

Insurance Coverage 

‘‘Sec. 6055. Reporting of health insurance coverage. 

‘‘SEC. 6055. REPORTING OF HEALTH INSURANCE COVERAGE. 

‘‘(a) IN GENERAL.—Every person who provides minimum essential coverage to an individual during a calendar year shall, at 

such time as the Secretary may prescribe, make a return described 

in subsection (b). 

‘‘(b) FORM AND MANNER OF RETURN.— 

‘‘(1) IN GENERAL.—A return is described in this subsection 

if such return— 

‘‘(A) is in such form as the Secretary may prescribe, 

and 

‘‘(B) contains— 

‘‘(i) the name, address and TIN of the primary 

insured and the name and TIN of each other individual 

obtaining coverage under the policy, 

‘‘(ii) the dates during which such individual was 

covered under minimum essential coverage during the 

calendar year, 

‘‘(iii) in the case of minimum essential coverage 

which consists of health insurance coverage, information concerning— 

‘‘(I) whether or not the coverage is a qualified 

health plan offered through an Exchange established under section 1311 of the Patient Protection 

and Affordable Care Act, and 

‘‘(II) in the case of a qualified health plan, 

the amount (if any) of any advance payment under 

section 1412 of the Patient Protection and Affordable Care Act of any cost-sharing reduction under 

section 1402 of such Act or of any premium tax 

credit under section 36B with respect to such coverage, and 

‘‘(iv) such other information as the Secretary may 

require. 

‘‘(2) INFORMATION RELATING TO EMPLOYER-PROVIDED COVERAGE.—If minimum essential coverage provided to an individual under subsection (a) consists of health insurance coverage of a health insurance issuer provided through a group 

health plan of an employer, a return described in this subsection 

shall include— 

‘‘(A) the name, address, and employer identification 

number of the employer maintaining the plan, 

‘‘(B) the portion of the premium (if any) required to 

be paid by the employer, and 

‘‘(C) if the health insurance coverage is a qualified 

health plan in the small group market offered through 

an Exchange, such other information as the Secretary may 

require for administration of the credit under section 45R 
H. R. 3590—133 

(relating to credit for employee health insurance expenses 

of small employers). 

‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVIDUALS WITH

RESPECT TO WHOM INFORMATION IS REPORTED.— 

‘‘(1) IN GENERAL.—Every person required to make a return 

under subsection (a) shall furnish to each individual whose 

name is required to be set forth in such return a written 

statement showing— 

‘‘(A) the name and address of the person required 

to make such return and the phone number of the information contact for such person, and 

‘‘(B) the information required to be shown on the return 

with respect to such individual. 

‘‘(2) TIME FOR FURNISHING STATEMENTS.—The written statement required under paragraph (1) shall be furnished on or 

before January 31 of the year following the calendar year 

for which the return under subsection (a) was required to 

be made. 

‘‘(d) COVERAGE PROVIDED BY GOVERNMENTAL UNITS.—In the 

case of coverage provided by any governmental unit or any agency 

or instrumentality thereof, the officer or employee who enters into 

the agreement to provide such coverage (or the person appropriately 

designated for purposes of this section) shall make the returns 

and statements required by this section. 

‘‘(e) MINIMUM ESSENTIAL COVERAGE.—For purposes of this section, the term ‘minimum essential coverage’ has the meaning given 

such term by section 5000A(f).’’. 

(b) ASSESSABLE PENALTIES.— 

(1) Subparagraph (B) of section 6724(d)(1) of the Internal 

Revenue Code of 1986 (relating to definitions) is amended by 

striking ‘‘or’’ at the end of clause (xxii), by striking ‘‘and’’ 

at the end of clause (xxiii) and inserting ‘‘or’’, and by inserting 

after clause (xxiii) the following new clause: 

‘‘(xxiv) section 6055 (relating to returns relating 

to information regarding health insurance coverage), 

and’’. 

(2) Paragraph (2) of section 6724(d) of such Code is 

amended by striking ‘‘or’’ at the end of subparagraph (EE), 

by striking the period at the end of subparagraph (FF) and 

inserting ‘‘, or’’ and by inserting after subparagraph (FF) the 

following new subparagraph: 

‘‘(GG) section 6055(c) (relating to statements relating 

to information regarding health insurance coverage).’’. 

(c) NOTIFICATION OF NONENROLLMENT.—Not later than June 

30 of each year, the Secretary of the Treasury, acting through 

the Internal Revenue Service and in consultation with the Secretary 

of Health and Human Services, shall send a notification to each 

individual who files an individual income tax return and who is 

not enrolled in minimum essential coverage (as defined in section 

5000A of the Internal Revenue Code of 1986). Such notification 

shall contain information on the services available through the 

Exchange operating in the State in which such individual resides. 

(d) CONFORMING AMENDMENT.—The table of subparts for part 

III of subchapter A of chapter 61 of such Code is amended by 

inserting after the item relating to subpart C the following new 

item: 
H. R. 3590—134 

‘‘SUBPART D—INFORMATION REGARDING HEALTH INSURANCE COVERAGE’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to calendar years beginning after 2013. 

PART II—EMPLOYER RESPONSIBILITIES 

SEC. 1511. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE 

EMPLOYERS. 

The Fair Labor Standards Act of 1938 is amended by inserting 

after section 18 (29 U.S.C. 218) the following: 

‘‘SEC. 18A. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE 

EMPLOYERS. 

‘‘In accordance with regulations promulgated by the Secretary, 

an employer to which this Act applies that has more than 200 

full-time employees and that offers employees enrollment in 1 or 

more health benefits plans shall automatically enroll new fulltime employees in one of the plans offered (subject to any waiting 

period authorized by law) and to continue the enrollment of current 

employees in a health benefits plan offered through the employer. 

Any automatic enrollment program shall include adequate notice 

and the opportunity for an employee to opt out of any coverage 

the individual or employee were automatically enrolled in. Nothing 

in this section shall be construed to supersede any State law which 

establishes, implements, or continues in effect any standard or 

requirement relating to employers in connection with payroll except 

to the extent that such standard or requirement prevents an 

employer from instituting the automatic enrollment program under 

this section.’’. 

SEC. 1512. EMPLOYER REQUIREMENT TO INFORM EMPLOYEES OF COVERAGE OPTIONS. 

The Fair Labor Standards Act of 1938 is amended by inserting 

after section 18A (as added by section 1513) the following: 

‘‘SEC. 18B. NOTICE TO EMPLOYEES. 

‘‘(a) IN GENERAL.—In accordance with regulations promulgated 

by the Secretary, an employer to which this Act applies, shall 

provide to each employee at the time of hiring (or with respect 

to current employees, not later than March 1, 2013), written 

notice— 

‘‘(1) informing the employee of the existence of an 

Exchange, including a description of the services provided by 

such Exchange, and the manner in which the employee may 

contact the Exchange to request assistance; 

‘‘(2) if the employer plan’s share of the total allowed costs 

of benefits provided under the plan is less than 60 percent 

of such costs, that the employee may be eligible for a premium 

tax credit under section 36B of the Internal Revenue Code 

of 1986 and a cost sharing reduction under section 1402 of 

the Patient Protection and Affordable Care Act if the employee 

purchases a qualified health plan through the Exchange; and 

‘‘(3) if the employee purchases a qualified health plan 

through the Exchange, the employee will lose the employer 

contribution (if any) to any health benefits plan offered by 

the employer and that all or a portion of such contribution 

may be excludable from income for Federal income tax purposes. 
H. R. 3590—135 

‘‘(b) EFFECTIVE DATE.—Subsection (a) shall take effect with 

respect to employers in a State beginning on March 1, 2013.’’. 

SEC. 1513. SHARED RESPONSIBILITY FOR EMPLOYERS. 

(a) IN GENERAL.—Chapter 43 of the Internal Revenue Code 

of 1986 is amended by adding at the end the following: 

‘‘SEC. 4980H. SHARED RESPONSIBILITY FOR EMPLOYERS REGARDING 

HEALTH COVERAGE. 

‘‘(a) LARGE EMPLOYERS NOT OFFERING HEALTH COVERAGE.— If— 

‘‘(1) any applicable large employer fails to offer to its fulltime employees (and their dependents) the opportunity to enroll 

in minimum essential coverage under an eligible employersponsored plan (as defined in section 5000A(f)(2)) for any 

month, and 

‘‘(2) at least one full-time employee of the applicable large 

employer has been certified to the employer under section 1411 

of the Patient Protection and Affordable Care Act as having 

enrolled for such month in a qualified health plan with respect 

to which an applicable premium tax credit or cost-sharing 

reduction is allowed or paid with respect to the employee, 

then there is hereby imposed on the employer an assessable payment equal to the product of the applicable payment amount and 

the number of individuals employed by the employer as full-time 

employees during such month. 

‘‘(b) LARGE EMPLOYERS WITH WAITING PERIODS EXCEEDING 30 

DAYS.— ‘‘(1) IN GENERAL.—In the case of any applicable large 

employer which requires an extended waiting period to enroll 

in any minimum essential coverage under an employer-sponsored plan (as defined in section 5000A(f)(2)), there is hereby 

imposed on the employer an assessable payment, in the amount 

specified in paragraph (2), for each full-time employee of the 

employer to whom the extended waiting period applies. 

‘‘(2) AMOUNT.—For purposes of paragraph (1), the amount 

specified in this paragraph for a full-time employee is— 

‘‘(A) in the case of an extended waiting period which exceeds 30 days but does not exceed 60 days, $400, and 

‘‘(B) in the case of an extended waiting period which exceeds 60 days, $600. 

‘‘(3) EXTENDED WAITING PERIOD.—The term ‘extended 

waiting period’ means any waiting period (as defined in section 

2701(b)(4) of the Public Health Service Act) which exceeds 

30 days. 

‘‘(c) LARGE EMPLOYERS OFFERING COVERAGE WITH EMPLOYEES

WHO QUALIFY FOR PREMIUM TAX CREDITS OR COST-SHARING REDUC- TIONS.— ‘‘(1) IN GENERAL.—If— 

‘‘(A) an applicable large employer offers to its fulltime employees (and their dependents) the opportunity to 

enroll in minimum essential coverage under an eligible 

employer-sponsored plan (as defined in section 5000A(f)(2)) 

for any month, and 

‘‘(B) 1 or more full-time employees of the applicable 

large employer has been certified to the employer under 

section 1411 of the Patient Protection and Affordable Care 

Act as having enrolled for such month in a qualified health 
H. R. 3590—136 

plan with respect to which an applicable premium tax 

credit or cost-sharing reduction is allowed or paid with 

respect to the employee, 

then there is hereby imposed on the employer an assessable 

payment equal to the product of the number of full-time 

employees of the applicable large employer described in 

subparagraph (B) for such month and 400 percent of the 

applicable payment amount. 

‘‘(2) OVERALL LIMITATION.—The aggregate amount of tax 

determined under paragraph (1) with respect to all employees 

of an applicable large employer for any month shall not exceed 

the product of the applicable payment amount and the number 

of individuals employed by the employer as full-time employees 

during such month. 

‘‘(d) DEFINITIONS AND SPECIAL RULES.—For purposes of this 

section— 

‘‘(1) APPLICABLE PAYMENT AMOUNT.—The term ‘applicable 

payment amount’ means, with respect to any month, 1⁄12 of 

$750. 

‘‘(2) APPLICABLE LARGE EMPLOYER.— 

‘‘(A) IN GENERAL.—The term ‘applicable large employer’ 

means, with respect to a calendar year, an employer who 

employed an average of at least 50 full-time employees 

on business days during the preceding calendar year. 

‘‘(B) EXEMPTION FOR CERTAIN EMPLOYERS.— ‘‘(i) IN GENERAL.—An employer shall not be considered to employ more than 50 full-time employees if— 

‘‘(I) the employer’s workforce exceeds 50 fulltime employees for 120 days or fewer during the 

calendar year, and 

‘‘(II) the employees in excess of 50 employed 

during such 120-day period were seasonal workers. 

‘‘(ii) DEFINITION OF SEASONAL WORKERS.—The term 

‘seasonal worker’ means a worker who performs labor 

or services on a seasonal basis as defined by the Secretary of Labor, including workers covered by section 

500.20(s)(1) of title 29, Code of Federal Regulations 

and retail workers employed exclusively during holiday 

seasons. 

‘‘(C) RULES FOR DETERMINING EMPLOYER SIZE.—For 

purposes of this paragraph— 

‘‘(i) APPLICATION OF AGGREGATION RULE FOR

EMPLOYERS.—All persons treated as a single employer 

under subsection (b), (c), (m), or (o) of section 414 

of the Internal Revenue Code of 1986 shall be treated 

as 1 employer. 

‘‘(ii) EMPLOYERS NOT IN EXISTENCE IN PRECEDING

YEAR.—In the case of an employer which was not in 

existence throughout the preceding calendar year, the 

determination of whether such employer is an 

applicable large employer shall be based on the average 

number of employees that it is reasonably expected 

such employer will employ on business days in the 

current calendar year. 

‘‘(iii) PREDECESSORS.—Any reference in this subsection to an employer shall include a reference to 

any predecessor of such employer. 
H. R. 3590—137 

‘‘(3) APPLICABLE PREMIUM TAX CREDIT AND COST-SHARING

REDUCTION.—The term ‘applicable premium tax credit and costsharing reduction’ means— 

‘‘(A) any premium tax credit allowed under section 

36B, 

‘‘(B) any cost-sharing reduction under section 1402 of 

the Patient Protection and Affordable Care Act, and 

‘‘(C) any advance payment of such credit or reduction 

under section 1412 of such Act. 

‘‘(4) FULL-TIME EMPLOYEE.— 

‘‘(A) IN GENERAL.—The term ‘full-time employee’ means 

an employee who is employed on average at least 30 hours 

of service per week. 

‘‘(B) HOURS OF SERVICE.—The Secretary, in consultation with the Secretary of Labor, shall prescribe such regulations, rules, and guidance as may be necessary to determine the hours of service of an employee, including rules 

for the application of this paragraph to employees who 

are not compensated on an hourly basis. 

‘‘(5) INFLATION ADJUSTMENT.— 

‘‘(A) IN GENERAL.—In the case of any calendar year 

after 2014, each of the dollar amounts in subsection (b)(2) 

and (d)(1) shall be increased by an amount equal to the 

product of— 

‘‘(i) such dollar amount, and 

‘‘(ii) the premium adjustment percentage (as 

defined in section 1302(c)(4) of the Patient Protection 

and Affordable Care Act) for the calendar year. 

‘‘(B) ROUNDING.—If the amount of any increase under 

subparagraph (A) is not a multiple of $10, such increase 

shall be rounded to the next lowest multiple of $10. 

‘‘(6) OTHER DEFINITIONS.—Any term used in this section 

which is also used in the Patient Protection and Affordable 

Care Act shall have the same meaning as when used in such 

Act. 

‘‘(7) TAX NONDEDUCTIBLE.—For denial of deduction for the 

tax imposed by this section, see section 275(a)(6). 

‘‘(e) ADMINISTRATION AND PROCEDURE.— 

‘‘(1) IN GENERAL.—Any assessable payment provided by 

this section shall be paid upon notice and demand by the 

Secretary, and shall be assessed and collected in the same 

manner as an assessable penalty under subchapter B of chapter 

68. 

‘‘(2) TIME FOR PAYMENT.—The Secretary may provide for 

the payment of any assessable payment provided by this section 

on an annual, monthly, or other periodic basis as the Secretary 

may prescribe. 

‘‘(3) COORDINATION WITH CREDITS, ETC..—The Secretary 

shall prescribe rules, regulations, or guidance for the repayment 

of any assessable payment (including interest) if such payment 

is based on the allowance or payment of an applicable premium 

tax credit or cost-sharing reduction with respect to an employee, 

such allowance or payment is subsequently disallowed, and 

the assessable payment would not have been required to be 

made but for such allowance or payment.’’. 
H. R. 3590—138 

(b) CLERICAL AMENDMENT.—The table of sections for chapter 

43 of such Code is amended by adding at the end the following 

new item: 

‘‘Sec. 4980H. Shared responsibility for employers regarding health coverage.’’. 

(c) STUDY AND REPORT OF EFFECT OF TAX ON WORKERS’ 

WAGES.— 

(1) IN GENERAL.—The Secretary of Labor shall conduct 

a study to determine whether employees’ wages are reduced 

by reason of the application of the assessable payments under 

section 4980H of the Internal Revenue Code of 1986 (as added 

by the amendments made by this section). The Secretary shall 

make such determination on the basis of the National Compensation Survey published by the Bureau of Labor Statistics. 

(2) REPORT.—The Secretary shall report the results of the 

study under paragraph (1) to the Committee on Ways and 

Means of the House of Representatives and to the Committee 

on Finance of the Senate. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to months beginning after December 31, 2013. 

SEC. 1514. REPORTING OF EMPLOYER HEALTH INSURANCE COVERAGE. 

(a) IN GENERAL.—Subpart D of part III of subchapter A of 

chapter 61 of the Internal Revenue Code of 1986, as added by 

section 1502, is amended by inserting after section 6055 the following new section: 

‘‘SEC. 6056. LARGE EMPLOYERS REQUIRED TO REPORT ON HEALTH 

INSURANCE COVERAGE. 

‘‘(a) IN GENERAL.—Every applicable large employer required 

to meet the requirements of section 4980H with respect to its 

full-time employees during a calendar year shall, at such time 

as the Secretary may prescribe, make a return described in subsection (b). 

‘‘(b) FORM AND MANNER OF RETURN.—A return is described 

in this subsection if such return— 

‘‘(1) is in such form as the Secretary may prescribe, and 

‘‘(2) contains— 

‘‘(A) the name, date, and employer identification 

number of the employer, 

‘‘(B) a certification as to whether the employer offers 

to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage under an 

eligible employer-sponsored plan (as defined in section 

5000A(f)(2)), 

‘‘(C) if the employer certifies that the employer did 

offer to its full-time employees (and their dependents) the 

opportunity to so enroll— 

‘‘(i) the length of any waiting period (as defined 

in section 2701(b)(4) of the Public Health Service Act) 

with respect to such coverage, 

‘‘(ii) the months during the calendar year for which 

coverage under the plan was available, 

‘‘(iii) the monthly premium for the lowest cost 

option in each of the enrollment categories under the 

plan, and 

‘‘(iv) the applicable large employer’s share of the 

total allowed costs of benefits provided under the plan, 
H. R. 3590—139 

‘‘(D) the number of full-time employees for each month 

during the calendar year, 

‘‘(E) the name, address, and TIN of each full-time 

employee during the calendar year and the months (if 

any) during which such employee (and any dependents) 

were covered under any such health benefits plans, and 

‘‘(F) such other information as the Secretary may 

require. 

‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVIDUALS WITH

RESPECT TO WHOM INFORMATION IS REPORTED.— 

‘‘(1) IN GENERAL.—Every person required to make a return 

under subsection (a) shall furnish to each full-time employee 

whose name is required to be set forth in such return under 

subsection (b)(2)(E) a written statement showing— 

‘‘(A) the name and address of the person required 

to make such return and the phone number of the information contact for such person, and 

‘‘(B) the information required to be shown on the return 

with respect to such individual. 

‘‘(2) TIME FOR FURNISHING STATEMENTS.—The written statement required under paragraph (1) shall be furnished on or 

before January 31 of the year following the calendar year 

for which the return under subsection (a) was required to 

be made. 

‘‘(d) COORDINATION WITH OTHER REQUIREMENTS.—To the maximum extent feasible, the Secretary may provide that— 

‘‘(1) any return or statement required to be provided under 

this section may be provided as part of any return or statement 

required under section 6051 or 6055, and 

‘‘(2) in the case of an applicable large employer offering 

health insurance coverage of a health insurance issuer, the 

employer may enter into an agreement with the issuer to 

include information required under this section with the return 

and statement required to be provided by the issuer under 

section 6055. 

‘‘(e) COVERAGE PROVIDED BY GOVERNMENTAL UNITS.—In the 

case of any applicable large employer which is a governmental 

unit or any agency or instrumentality thereof, the person appropriately designated for purposes of this section shall make the 

returns and statements required by this section. 

‘‘(f) DEFINITIONS.—For purposes of this section, any term used 

in this section which is also used in section 4980H shall have 

the meaning given such term by section 4980H.’’. 

(b) ASSESSABLE PENALTIES.— 

(1) Subparagraph (B) of section 6724(d)(1) of the Internal 

Revenue Code of 1986 (relating to definitions), as amended 

by section 1502, is amended by striking ‘‘or’’ at the end of 

clause (xxiii), by striking ‘‘and’’ at the end of clause (xxiv) 

and inserting ‘‘or’’, and by inserting after clause (xxiv) the 

following new clause: 

‘‘(xxv) section 6056 (relating to returns relating 

to large employers required to report on health insurance coverage), and’’. 

(2) Paragraph (2) of section 6724(d) of such Code, as so 

amended, is amended by striking ‘‘or’’ at the end of subparagraph (FF), by striking the period at the end of subparagraph 
H. R. 3590—140 

(GG) and inserting ‘‘, or’’ and by inserting after subparagraph 

(GG) the following new subparagraph: 

‘‘(HH) section 6056(c) (relating to statements relating 

to large employers required to report on health insurance 

coverage).’’. 

(c) CONFORMING AMENDMENT.—The table of sections for subpart 

D of part III of subchapter A of chapter 61 of such Code, as 

added by section 1502, is amended by adding at the end the following new item: 

‘‘Sec. 6056. Large employers required to report on health insurance coverage.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to periods beginning after December 31, 2013. 

SEC. 1515. OFFERING OF EXCHANGE-PARTICIPATING QUALIFIED 

HEALTH PLANS THROUGH CAFETERIA PLANS. 

(a) IN GENERAL.—Subsection (f) of section 125 of the Internal 

Revenue Code of 1986 is amended by adding at the end the following 

new paragraph: 

‘‘(3) CERTAIN EXCHANGE-PARTICIPATING QUALIFIED HEALTH

PLANS NOT QUALIFIED.— ‘‘(A) IN GENERAL.—The term ‘qualified benefit’ shall 

not include any qualified health plan (as defined in section 

1301(a) of the Patient Protection and Affordable Care Act) 

offered through an Exchange established under section 

1311 of such Act. 

‘‘(B) EXCEPTION FOR EXCHANGE-ELIGIBLE EMPLOYERS.— Subparagraph (A) shall not apply with respect to any 

employee if such employee’s employer is a qualified 

employer (as defined in section 1312(f)(2) of the Patient 

Protection and Affordable Care Act) offering the employee 

the opportunity to enroll through such an Exchange in 

a qualified health plan in a group market.’’. 

(b) CONFORMING AMENDMENTS.—Subsection (f) of section 125 

of such Code is amended— 

(1) by striking ‘‘For purposes of this section, the term’’ 

and inserting ‘‘For purposes of this section— 

‘‘(1) IN GENERAL.—The term’’, and 

(2) by striking ‘‘Such term shall not include’’ and inserting 

the following: 

‘‘(2) LONG-TERM CARE INSURANCE NOT QUALIFIED.—The 

term ‘qualified benefit’ shall not include’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2013. 

Subtitle G—Miscellaneous Provisions 

SEC. 1551. DEFINITIONS. 

Unless specifically provided for otherwise, the definitions contained in section 2791 of the Public Health Service Act (42 U.S.C. 

300gg–91) shall apply with respect to this title. 

SEC. 1552. TRANSPARENCY IN GOVERNMENT. 

Not later than 30 days after the date of enactment of this 

Act, the Secretary of Health and Human Services shall publish 

on the Internet website of the Department of Health and Human 

Services, a list of all of the authorities provided to the Secretary 

under this Act (and the amendments made by this Act). 
H. R. 3590—141 

SEC. 1553. PROHIBITION AGAINST DISCRIMINATION ON ASSISTED SUICIDE. 

(a) IN GENERAL.—The Federal Government, and any State or 

local government or health care provider that receives Federal 

financial assistance under this Act (or under an amendment made 

by this Act) or any health plan created under this Act (or under 

an amendment made by this Act), may not subject an individual 

or institutional health care entity to discrimination on the basis 

that the entity does not provide any health care item or service 

furnished for the purpose of causing, or for the purpose of assisting 

in causing, the death of any individual, such as by assisted suicide, 

euthanasia, or mercy killing. 

(b) DEFINITION.—In this section, the term ‘‘health care entity’’ 

includes an individual physician or other health care professional, 

a hospital, a provider-sponsored organization, a health maintenance 

organization, a health insurance plan, or any other kind of health 

care facility, organization, or plan. 

(c) CONSTRUCTION AND TREATMENT OF CERTAIN SERVICES.— 

Nothing in subsection (a) shall be construed to apply to, or to 

affect, any limitation relating to— 

(1) the withholding or withdrawing of medical treatment 

or medical care; 

(2) the withholding or withdrawing of nutrition or hydration; 

(3) abortion; or 

(4) the use of an item, good, benefit, or service furnished 

for the purpose of alleviating pain or discomfort, even if such 

use may increase the risk of death, so long as such item, 

good, benefit, or service is not also furnished for the purpose 

of causing, or the purpose of assisting in causing, death, for 

any reason. 

(d) ADMINISTRATION.—The Office for Civil Rights of the Department of Health and Human Services is designated to receive complaints of discrimination based on this section. 

SEC. 1554. ACCESS TO THERAPIES. 

Notwithstanding any other provision of this Act, the Secretary 

of Health and Human Services shall not promulgate any regulation 

that— 

(1) creates any unreasonable barriers to the ability of 

individuals to obtain appropriate medical care; 

(2) impedes timely access to health care services; 

(3) interferes with communications regarding a full range 

of treatment options between the patient and the provider; 

(4) restricts the ability of health care providers to provide 

full disclosure of all relevant information to patients making 

health care decisions; 

(5) violates the principles of informed consent and the 

ethical standards of health care professionals; or 

(6) limits the availability of health care treatment for the 

full duration of a patient’s medical needs. 
H. R. 3590—142 

SEC. 1555. FREEDOM NOT TO PARTICIPATE IN FEDERAL HEALTH 

INSURANCE PROGRAMS. 

No individual, company, business, nonprofit entity, or health 

insurance issuer offering group or individual health insurance coverage shall be required to participate in any Federal health insurance program created under this Act (or any amendments made 

by this Act), or in any Federal health insurance program expanded 

by this Act (or any such amendments), and there shall be no 

penalty or fine imposed upon any such issuer for choosing not 

to participate in such programs. 

SEC. 1556. EQUITY FOR CERTAIN ELIGIBLE SURVIVORS. 

(a) REBUTTABLE PRESUMPTION.—Section 411(c)(4) of the Black 

Lung Benefits Act (30 U.S.C. 921(c)(4)) is amended by striking 

the last sentence. 

(b) CONTINUATION OF BENEFITS.—Section 422(l) of the Black 

Lung Benefits Act (30 U.S.C. 932(l)) is amended by striking ‘‘, 

except with respect to a claim filed under this part on or after 

the effective date of the Black Lung Benefits Amendments of 1981’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to claims filed under part B or part C 

of the Black Lung Benefits Act (30 U.S.C. 921 et seq., 931 et 

seq.) after January 1, 2005, that are pending on or after the date 

of enactment of this Act. 

SEC. 1557. NONDISCRIMINATION. 

(a) IN GENERAL.—Except as otherwise provided for in this title 

(or an amendment made by this title), an individual shall not, 

on the ground prohibited under title VI of the Civil Rights Act 

of 1964 (42 U.S.C. 2000d et seq.), title IX of the Education Amendments of 1972 (20 U.S.C. 1681 et seq.), the Age Discrimination 

Act of 1975 (42 U.S.C. 6101 et seq.), or section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), be excluded from participation 

in, be denied the benefits of, or be subjected to discrimination 

under, any health program or activity, any part of which is receiving 

Federal financial assistance, including credits, subsidies, or contracts of insurance, or under any program or activity that is 

administered by an Executive Agency or any entity established 

under this title (or amendments). The enforcement mechanisms 

provided for and available under such title VI, title IX, section 

504, or such Age Discrimination Act shall apply for purposes of 

violations of this subsection. 

(b) CONTINUED APPLICATION OF LAWS.—Nothing in this title 

(or an amendment made by this title) shall be construed to invalidate or limit the rights, remedies, procedures, or legal standards 

available to individuals aggrieved under title VI of the Civil Rights 

Act of 1964 (42 U.S.C. 2000d et seq.), title VII of the Civil Rights 

Act of 1964 (42 U.S.C. 2000e et seq.), title IX of the Education 

Amendments of 1972 (20 U.S.C. 1681 et seq.), section 504 of the 

Rehabilitation Act of 1973 (29 U.S.C. 794), or the Age Discrimination Act of 1975 (42 U.S.C. 611 et seq.), or to supersede State 

laws that provide additional protections against discrimination on 

any basis described in subsection (a). 

(c) REGULATIONS.—The Secretary may promulgate regulations 

to implement this section. 
H. R. 3590—143 

SEC. 1558. PROTECTIONS FOR EMPLOYEES. 

The Fair Labor Standards Act of 1938 is amended by inserting 

after section 18B (as added by section 1512) the following: 

‘‘SEC. 18C. PROTECTIONS FOR EMPLOYEES. 

‘‘(a) PROHIBITION.—No employer shall discharge or in any 

manner discriminate against any employee with respect to his 

or her compensation, terms, conditions, or other privileges of 

employment because the employee (or an individual acting at the 

request of the employee) has— 

‘‘(1) received a credit under section 36B of the Internal 

Revenue Code of 1986 or a subsidy under section 1402 of 

this Act; 

‘‘(2) provided, caused to be provided, or is about to provide 

or cause to be provided to the employer, the Federal Government, or the attorney general of a State information relating 

to any violation of, or any act or omission the employee reasonably believes to be a violation of, any provision of this title 

(or an amendment made by this title); 

‘‘(3) testified or is about to testify in a proceeding concerning 

such violation; 

‘‘(4) assisted or participated, or is about to assist or participate, in such a proceeding; or 

‘‘(5) objected to, or refused to participate in, any activity, 

policy, practice, or assigned task that the employee (or other 

such person) reasonably believed to be in violation of any provision of this title (or amendment), or any order, rule, regulation, 

standard, or ban under this title (or amendment). 

‘‘(b) COMPLAINT PROCEDURE.— 

‘‘(1) IN GENERAL.—An employee who believes that he or 

she has been discharged or otherwise discriminated against 

by any employer in violation of this section may seek relief 

in accordance with the procedures, notifications, burdens of 

proof, remedies, and statutes of limitation set forth in section 

2087(b) of title 15, United States Code. 

‘‘(2) NO LIMITATION ON RIGHTS.—Nothing in this section 

shall be deemed to diminish the rights, privileges, or remedies 

of any employee under any Federal or State law or under 

any collective bargaining agreement. The rights and remedies 

in this section may not be waived by any agreement, policy, 

form, or condition of employment.’’. 

SEC. 1559. OVERSIGHT. 

The Inspector General of the Department of Health and Human 

Services shall have oversight authority with respect to the administration and implementation of this title as it relates to such Department. 

SEC. 1560. RULES OF CONSTRUCTION. 

(a) NO EFFECT ON ANTITRUST LAWS.—Nothing in this title 

(or an amendment made by this title) shall be construed to modify, 

impair, or supersede the operation of any of the antitrust laws. 

For the purposes of this section, the term ‘‘antitrust laws’’ has 

the meaning given such term in subsection (a) of the first section 

of the Clayton Act, except that such term includes section 5 of 

the Federal Trade Commission Act to the extent that such section 

5 applies to unfair methods of competition. 
H. R. 3590—144 

(b) RULE OF CONSTRUCTION REGARDING HAWAII’S PREPAID

HEALTH CARE ACT.—Nothing in this title (or an amendment made 

by this title) shall be construed to modify or limit the application 

of the exemption for Hawaii’s Prepaid Health Care Act (Haw. Rev. 

Stat. §§ 393–1 et seq.) as provided for under section 514(b)(5) 

of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 

1144(b)(5)). 

(c) STUDENT HEALTH INSURANCE PLANS.—Nothing in this title 

(or an amendment made by this title) shall be construed to prohibit 

an institution of higher education (as such term is defined for 

purposes of the Higher Education Act of 1965) from offering a 

student health insurance plan, to the extent that such requirement 

is otherwise permitted under applicable Federal, State or local 

law. 

(d) NO EFFECT ON EXISTING REQUIREMENTS.—Nothing in this 

title (or an amendment made by this title, unless specified by 

direct statutory reference) shall be construed to modify any existing 

Federal requirement concerning the State agency responsible for 

determining eligibility for programs identified in section 1413. 

SEC. 1561. HEALTH INFORMATION TECHNOLOGY ENROLLMENT STANDARDS AND PROTOCOLS. 

Title XXX of the Public Health Service Act (42 U.S.C. 300jj 

et seq.) is amended by adding at the end the following: 

‘‘Subtitle C—Other Provisions 

‘‘SEC. 3021. HEALTH INFORMATION TECHNOLOGY ENROLLMENT 

STANDARDS AND PROTOCOLS. 

‘‘(a) IN GENERAL.— ‘‘(1) STANDARDS AND PROTOCOLS.—Not later than 180 days 

after the date of enactment of this title, the Secretary, in 

consultation with the HIT Policy Committee and the HIT Standards Committee, shall develop interoperable and secure standards and protocols that facilitate enrollment of individuals in 

Federal and State health and human services programs, as 

determined by the Secretary. 

‘‘(2) METHODS.—The Secretary shall facilitate enrollment 

in such programs through methods determined appropriate by 

the Secretary, which shall include providing individuals and 

third parties authorized by such individuals and their designees 

notification of eligibility and verification of eligibility required 

under such programs. 

‘‘(b) CONTENT.—The standards and protocols for electronic 

enrollment in the Federal and State programs described in subsection (a) shall allow for the following: 

‘‘(1) Electronic matching against existing Federal and State 

data, including vital records, employment history, enrollment 

systems, tax records, and other data determined appropriate 

by the Secretary to serve as evidence of eligibility and in 

lieu of paper-based documentation. 

‘‘(2) Simplification and submission of electronic documentation, digitization of documents, and systems verification of eligibility. 

‘‘(3) Reuse of stored eligibility information (including documentation) to assist with retention of eligible individuals. 
H. R. 3590—145 

‘‘(4) Capability for individuals to apply, recertify and manage their eligibility information online, including at home, at 

points of service, and other community-based locations. 

‘‘(5) Ability to expand the enrollment system to integrate 

new programs, rules, and functionalities, to operate at increased 

volume, and to apply streamlined verification and eligibility 

processes to other Federal and State programs, as appropriate. 

‘‘(6) Notification of eligibility, recertification, and other 

needed communication regarding eligibility, which may include 

communication via email and cellular phones. 

‘‘(7) Other functionalities necessary to provide eligibles with 

streamlined enrollment process. 

‘‘(c) APPROVAL AND NOTIFICATION.—With respect to any 

standard or protocol developed under subsection (a) that has been 

approved by the HIT Policy Committee and the HIT Standards 

Committee, the Secretary— 

‘‘(1) shall notify States of such standards or protocols; and 

‘‘(2) may require, as a condition of receiving Federal funds 

for the health information technology investments, that States 

or other entities incorporate such standards and protocols into 

such investments. 

‘‘(d) GRANTS FOR IMPLEMENTATION OF APPROPRIATE ENROLLMENT HIT.— 

‘‘(1) IN GENERAL.—The Secretary shall award grant to 

eligible entities to develop new, and adapt existing, technology 

systems to implement the HIT enrollment standards and protocols developed under subsection (a) (referred to in this subsection as ‘appropriate HIT technology’). 

‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a grant under 

this subsection, an entity shall— 

‘‘(A) be a State, political subdivision of a State, or 

a local governmental entity; and 

‘‘(B) submit to the Secretary an application at such 

time, in such manner, and containing— 

‘‘(i) a plan to adopt and implement appropriate 

enrollment technology that includes— 

‘‘(I) proposed reduction in maintenance costs 

of technology systems; 

‘‘(II) elimination or updating of legacy systems; 

and 

‘‘(III) demonstrated collaboration with other 

entities that may receive a grant under this section 

that are located in the same State, political subdivision, or locality; 

‘‘(ii) an assurance that the entity will share such 

appropriate enrollment technology in accordance with 

paragraph (4); and 

‘‘(iii) such other information as the Secretary may 

require. 

‘‘(3) SHARING.— 

‘‘(A) IN GENERAL.—The Secretary shall ensure that 

appropriate enrollment HIT adopted under grants under 

this subsection is made available to other qualified State, 

qualified political subdivisions of a State, or other appropriate qualified entities (as described in subparagraph (B)) 

at no cost. 
H. R. 3590—146 

‘‘(B) QUALIFIED ENTITIES.—The Secretary shall determine what entities are qualified to receive enrollment HIT 

under subparagraph (A), taking into consideration the recommendations of the HIT Policy Committee and the HIT 

Standards Committee.’’. 

SEC. 1562. CONFORMING AMENDMENTS. 

(a) APPLICABILITY.—Section 2735 of the Public Health Service 

Act (42 U.S.C. 300gg–21), as so redesignated by section 1001(4), 

is amended— 

(1) by striking subsection (a); 

(2) in subsection (b)— 

(A) in paragraph (1), by striking ‘‘1 through 3’’ and 

inserting ‘‘1 and 2’’; and 

(B) in paragraph (2)— 

(i) in subparagraph (A), by striking ‘‘subparagraph 

(D)’’ and inserting ‘‘subparagraph (D) or (E)’’; 

(ii) by striking ‘‘1 through 3’’ and inserting ‘‘1 

and 2’’; and 

(iii) by adding at the end the following: 

‘‘(E) ELECTION NOT APPLICABLE.—The election 

described in subparagraph (A) shall not be available with 

respect to the provisions of subpart 1.’’; 

(3) in subsection (c), by striking ‘‘1 through 3 shall not 

apply to any group’’ and inserting ‘‘1 and 2 shall not apply 

to any individual coverage or any group’’; and 

(4) in subsection (d)— 

(A) in paragraph (1), by striking ‘‘1 through 3 shall 

not apply to any group’’ and inserting ‘‘1 and 2 shall not 

apply to any individual coverage or any group’’; 

(B) in paragraph (2)— 

(i) in the matter preceding subparagraph (A), by 

striking ‘‘1 through 3 shall not apply to any group’’ 

and inserting ‘‘1 and 2 shall not apply to any individual 

coverage or any group’’; and 

(ii) in subparagraph (C), by inserting ‘‘or, with 

respect to individual coverage, under any health insurance coverage maintained by the same health insurance issuer’’; and 

(C) in paragraph (3), by striking ‘‘any group’’ and 

inserting ‘‘any individual coverage or any group’’. 

(b) DEFINITIONS.—Section 2791(d) of the Public Health Service 

Act (42 U.S.C. 300gg–91(d)) is amended by adding at the end 

the following: 

‘‘(20) QUALIFIED HEALTH PLAN.—The term ‘qualified health 

plan’ has the meaning given such term in section 1301(a) of 

the Patient Protection and Affordable Care Act. 

‘‘(21) EXCHANGE.—The term ‘Exchange’ means an American 

Health Benefit Exchange established under section 1311 of 

the Patient Protection and Affordable Care Act.’’. 

(c) TECHNICAL AND CONFORMING AMENDMENTS.—Title XXVII 

of the Public Health Service Act (42 U.S.C. 300gg et seq.) is 

amended— 

(1) in section 2704 (42 U.S.C. 300gg), as so redesignated 

by section 1201(2)— 

(A) in subsection (c)— 
H. R. 3590—147 

(i) in paragraph (2), by striking ‘‘group health plan’’ 

each place that such term appears and inserting ‘‘group 

or individual health plan’’; and 

(ii) in paragraph (3)— 

(I) by striking ‘‘group health insurance’’ each 

place that such term appears and inserting ‘‘group 

or individual health insurance’’; and 

(II) in subparagraph (D), by striking ‘‘small 

or large’’ and inserting ‘‘individual or group’’; 

(B) in subsection (d), by striking ‘‘group health insurance’’ each place that such term appears and inserting 

‘‘group or individual health insurance’’; and 

(C) in subsection (e)(1)(A), by striking ‘‘group health 

insurance’’ and inserting ‘‘group or individual health insurance’’; 

(2) by striking the second heading for subpart 2 of part 

A (relating to other requirements); 

(3) in section 2725 (42 U.S.C. 300gg–4), as so redesignated 

by section 1001(2)— 

(A) in subsection (a), by striking ‘‘health insurance 

issuer offering group health insurance coverage’’ and 

inserting ‘‘health insurance issuer offering group or individual health insurance coverage’’; 

(B) in subsection (b)— 

(i) by striking ‘‘health insurance issuer offering 

group health insurance coverage in connection with 

a group health plan’’ in the matter preceding paragraph (1) and inserting ‘‘health insurance issuer 

offering group or individual health insurance coverage’’; 

and 

(ii) in paragraph (1), by striking ‘‘plan’’ and 

inserting ‘‘plan or coverage’’; 

(C) in subsection (c)— 

(i) in paragraph (2), by striking ‘‘group health 

insurance coverage offered by a health insurance 

issuer’’ and inserting ‘‘health insurance issuer offering 

group or individual health insurance coverage’’; and 

(ii) in paragraph (3), by striking ‘‘issuer’’ and 

inserting ‘‘health insurance issuer’’; and 

(D) in subsection (e), by striking ‘‘health insurance 

issuer offering group health insurance coverage’’ and 

inserting ‘‘health insurance issuer offering group or individual health insurance coverage’’; 

(4) in section 2726 (42 U.S.C. 300gg–5), as so redesignated 

by section 1001(2)— 

(A) in subsection (a), by striking ‘‘(or health insurance 

coverage offered in connection with such a plan)’’ each 

place that such term appears and inserting ‘‘or a health 

insurance issuer offering group or individual health insurance coverage’’; 

(B) in subsection (b), by striking ‘‘(or health insurance 

coverage offered in connection with such a plan)’’ each 

place that such term appears and inserting ‘‘or a health 

insurance issuer offering group or individual health insurance coverage’’; and 

(C) in subsection (c)— 
H. R. 3590—148 

(i) in paragraph (1), by striking ‘‘(and group health 

insurance coverage offered in connection with a group 

health plan)’’ and inserting ‘‘and a health insurance 

issuer offering group or individual health insurance 

coverage’’; 

(ii) in paragraph (2), by striking ‘‘(or health insurance coverage offered in connection with such a plan)’’ 

each place that such term appears and inserting ‘‘or 

a health insurance issuer offering group or individual 

health insurance coverage’’; 

(5) in section 2727 (42 U.S.C. 300gg–6), as so redesignated 

by section 1001(2), by striking ‘‘health insurance issuers providing health insurance coverage in connection with group 

health plans’’ and inserting ‘‘and health insurance issuers 

offering group or individual health insurance coverage’’; 

(6) in section 2728 (42 U.S.C. 300gg–7), as so redesignated 

by section 1001(2)— 

(A) in subsection (a), by striking ‘‘health insurance 

coverage offered in connection with such plan’’ and 

inserting ‘‘individual health insurance coverage’’; 

(B) in subsection (b)— 

(i) in paragraph (1), by striking ‘‘or a health insurance issuer that provides health insurance coverage 

in connection with a group health plan’’ and inserting 

‘‘or a health insurance issuer that offers group or individual health insurance coverage’’; 

(ii) in paragraph (2), by striking ‘‘health insurance 

coverage offered in connection with the plan’’ and 

inserting ‘‘individual health insurance coverage’’; and 

(iii) in paragraph (3), by striking ‘‘health insurance 

coverage offered by an issuer in connection with such 

plan’’ and inserting ‘‘individual health insurance coverage’’; 

(C) in subsection (c), by striking ‘‘health insurance 

issuer providing health insurance coverage in connection 

with a group health plan’’ and inserting ‘‘health insurance 

issuer that offers group or individual health insurance 

coverage’’; and 

(D) in subsection (e)(1), by striking ‘‘health insurance 

coverage offered in connection with such a plan’’ and 

inserting ‘‘individual health insurance coverage’’; 

(7) by striking the heading for subpart 3; 

(8) in section 2731 (42 U.S.C. 300gg–11), as so redesignated 

by section 1001(3)— 

(A) by striking the section heading and all that follows 

through subsection (b); 

(B) in subsection (c)— 

(i) in paragraph (1)— 

(I) in the matter preceding subparagraph (A), 

by striking ‘‘small group’’ and inserting ‘‘group and 

individual’’; and 

(II) in subparagraph (B)— 

(aa) in the matter preceding clause (i), 

by inserting ‘‘and individuals’’ after 

‘‘employers’’; 
H. R. 3590—149 

(bb) in clause (i), by inserting ‘‘or any 

additional individuals’’ after ‘‘additional 

groups’’; and 

(cc) in clause (ii), by striking ‘‘without 

regard to the claims experience of those 

employers and their employees (and their 

dependents) or any health status-related factor 

relating to such’’ and inserting ‘‘and individuals without regard to the claims experience 

of those individuals, employers and their 

employees (and their dependents) or any 

health status-related factor relating to such 

individuals’’; and 

(ii) in paragraph (2), by striking ‘‘small group’’ 

and inserting ‘‘group or individual’’; 

(C) in subsection (d)— 

(i) by striking ‘‘small group’’ each place that such 

appears and inserting ‘‘group or individual’’; and 

(ii) in paragraph (1)(B)— 

(I) by striking ‘‘all employers’’ and inserting 

‘‘all employers and individuals’’; 

(II) by striking ‘‘those employers’’ and 

inserting ‘‘those individuals, employers’’; and 

(III) by striking ‘‘such employees’’ and 

inserting ‘‘such individuals, employees’’; 

(D) by striking subsection (e); 

(E) by striking subsection (f); and 

(F) by transferring such section (as amended by this 

paragraph) to appear at the end of section 2702 (as added 

by section 1001(4)); 

(9) in section 2732 (42 U.S.C. 300gg–12), as so redesignated 

by section 1001(3)— 

(A) by striking the section heading and all that follows 

through subsection (a); 

(B) in subsection (b)— 

(i) in the matter preceding paragraph (1), by 

striking ‘‘group health plan in the small or large group 

market’’ and inserting ‘‘health insurance coverage 

offered in the group or individual market’’; 

(ii) in paragraph (1), by inserting ‘‘, or individual, 

as applicable,’’ after ‘‘plan sponsor’’; 

(iii) in paragraph (2), by inserting ‘‘, or individual, 

as applicable,’’ after ‘‘plan sponsor’’; and 

(iv) by striking paragraph (3) and inserting the 

following: 

‘‘(3) VIOLATION OF PARTICIPATION OR CONTRIBUTION

RATES.—In the case of a group health plan, the plan sponsor 

has failed to comply with a material plan provision relating 

to employer contribution or group participation rules, pursuant 

to applicable State law.’’; 

(C) in subsection (c)— 

(i) in paragraph (1)— 

(I) in the matter preceding subparagraph (A), 

by striking ‘‘group health insurance coverage 

offered in the small or large group market’’ and 

inserting ‘‘group or individual health insurance 

coverage’’; 
H. R. 3590—150 

(II) in subparagraph (A), by inserting ‘‘or individual, as applicable,’’ after ‘‘plan sponsor’’; 

(III) in subparagraph (B)— 

(aa) by inserting ‘‘or individual, as 

applicable,’’ after ‘‘plan sponsor’’; and 

(bb) by inserting ‘‘or individual health 

insurance coverage’’; and 

(IV) in subparagraph (C), by inserting ‘‘or 

individuals, as applicable,’’ after ‘‘those sponsors’’; 

and 

(ii) in paragraph (2)(A)— 

(I) in the matter preceding clause (i), by 

striking ‘‘small group market or the large group 

market, or both markets,’’ and inserting ‘‘individual or group market, or all markets,’’; and 

(II) in clause (i), by inserting ‘‘or individual, 

as applicable,’’ after ‘‘plan sponsor’’; and 

(D) by transferring such section (as amended by this 

paragraph) to appear at the end of section 2703 (as added 

by section 1001(4)); 

(10) in section 2733 (42 U.S.C. 300gg–13), as so redesignated by section 1001(4)— 

(A) in subsection (a)— 

(i) in the matter preceding paragraph (1), by 

striking ‘‘small employer’’ and inserting ‘‘small 

employer or an individual’’; 

(ii) in paragraph (1), by inserting ‘‘, or individual, 

as applicable,’’ after ‘‘employer’’ each place that such 

appears; and 

(iii) in paragraph (2), by striking ‘‘small employer’’ 

and inserting ‘‘employer, or individual, as applicable,’’; 

(B) in subsection (b)— 

(i) in paragraph (1)— 

(I) in the matter preceding subparagraph (A), 

by striking ‘‘small employer’’ and inserting 

‘‘employer, or individual, as applicable,’’; 

(II) in subparagraph (A), by adding ‘‘and’’ at 

the end; 

(III) by striking subparagraphs (B) and (C); 

and 

(IV) in subparagraph (D)— 

(aa) by inserting ‘‘, or individual, as 

applicable,’’ after ‘‘employer’’; and 

(bb) by redesignating such subparagraph 

as subparagraph (B); 

(ii) in paragraph (2)— 

(I) by striking ‘‘small employers’’ each place 

that such term appears and inserting ‘‘employers, 

or individuals, as applicable,’’; and 

(II) by striking ‘‘small employer’’ and inserting 

‘‘employer, or individual, as applicable,’’; and 

(C) by redesignating such section (as amended by this 

paragraph) as section 2709 and transferring such section 

to appear after section 2708 (as added by section 1001(5)); 

(11) by redesignating subpart 4 as subpart 2; 

(12) in section 2735 (42 U.S.C. 300gg–21), as so redesignated by section 1001(4)— 
H. R. 3590—151 

(A) by striking subsection (a); 

(B) by striking ‘‘subparts 1 through 3’’ each place that 

such appears and inserting ‘‘subpart 1’’; 

(C) by redesignating subsections (b) through (e) as 

subsections (a) through (d), respectively; and 

(D) by redesignating such section (as amended by this 

paragraph) as section 2722; 

(13) in section 2736 (42 U.S.C. 300gg–22), as so redesignated by section 1001(4)— 

(A) in subsection (a)— 

(i) in paragraph (1), by striking ‘‘small or large 

group markets’’ and inserting ‘‘individual or group 

market’’; and 

(ii) in paragraph (2), by inserting ‘‘or individual 

health insurance coverage’’ after ‘‘group health plans’’; 

(B) in subsection (b)(1)(B), by inserting ‘‘individual 

health insurance coverage or’’ after ‘‘respect to’’; and 

(C) by redesignating such section (as amended by this 

paragraph) as section 2723; 

(14) in section 2737(a)(1) (42 U.S.C. 300gg–23), as so 

redesignated by section 1001(4)— 

(A) by inserting ‘‘individual or’’ before ‘‘group health 

insurance’’; and 

(B) by redesignating such section(as amended by this 

paragraph) as section 2724; 

(15) in section 2762 (42 U.S.C. 300gg–62)— 

(A) in the section heading by inserting ‘‘AND APPLICATION’’ before the period; and 

(B) by adding at the end the following: 

‘‘(c) APPLICATION OF PART A PROVISIONS.— 

‘‘(1) IN GENERAL.—The provisions of part A shall apply 

to health insurance issuers providing health insurance coverage 

in the individual market in a State as provided for in such 

part. 

‘‘(2) CLARIFICATION.—To the extent that any provision of 

this part conflicts with a provision of part A with respect 

to health insurance issuers providing health insurance coverage 

in the individual market in a State, the provisions of such 

part A shall apply.’’; and 

(16) in section 2791(e) (42 U.S.C. 300gg–91(e))— 

(A) in paragraph (2), by striking ‘‘51’’ and inserting 

‘‘101’’; and 

(B) in paragraph (4)— 

(i) by striking ‘‘at least 2’’ each place that such 

appears and inserting ‘‘at least 1’’; and 

(ii) by striking ‘‘50’’ and inserting ‘‘100’’. 

(d) APPLICATION.—Notwithstanding any other provision of the 

Patient Protection and Affordable Care Act, nothing in such Act 

(or an amendment made by such Act) shall be construed to— 

(1) prohibit (or authorize the Secretary of Health and 

Human Services to promulgate regulations that prohibit) a 

group health plan or health insurance issuer from carrying 

out utilization management techniques that are commonly used 

as of the date of enactment of this Act; or 

(2) restrict the application of the amendments made by 

this subtitle. 
H. R. 3590—152 

(e) TECHNICAL AMENDMENT TO THE EMPLOYEE RETIREMENT

INCOME SECURITY ACT OF 1974.—Subpart B of part 7 of subtitle 

A of title I of the Employee Retirement Income Security Act of 

1974 (29 U.S.C. 1181 et. seq.) is amended, by adding at the end 

the following: 

‘‘SEC. 715. ADDITIONAL MARKET REFORMS. 

‘‘(a) GENERAL RULE.—Except as provided in subsection (b)— 

‘‘(1) the provisions of part A of title XXVII of the Public 

Health Service Act (as amended by the Patient Protection and 

Affordable Care Act) shall apply to group health plans, and 

health insurance issuers providing health insurance coverage 

in connection with group health plans, as if included in this 

subpart; and 

‘‘(2) to the extent that any provision of this part conflicts 

with a provision of such part A with respect to group health 

plans, or health insurance issuers providing health insurance 

coverage in connection with group health plans, the provisions 

of such part A shall apply. 

‘‘(b) EXCEPTION.—Notwithstanding subsection (a), the provisions of sections 2716 and 2718 of title XXVII of the Public Health 

Service Act (as amended by the Patient Protection and Affordable 

Care Act) shall not apply with respect to self-insured group health 

plans, and the provisions of this part shall continue to apply to 

such plans as if such sections of the Public Health Service Act 

(as so amended) had not been enacted.’’. 

(f) TECHNICAL AMENDMENT TO THE INTERNAL REVENUE CODE

OF 1986.—Subchapter B of chapter 100 of the Internal Revenue 

Code of 1986 is amended by adding at the end the following: 

‘‘SEC. 9815. ADDITIONAL MARKET REFORMS. 

‘‘(a) GENERAL RULE.—Except as provided in subsection (b)— 

‘‘(1) the provisions of part A of title XXVII of the Public 

Health Service Act (as amended by the Patient Protection and 

Affordable Care Act) shall apply to group health plans, and 

health insurance issuers providing health insurance coverage 

in connection with group health plans, as if included in this 

subchapter; and 

‘‘(2) to the extent that any provision of this subchapter 

conflicts with a provision of such part A with respect to group 

health plans, or health insurance issuers providing health 

insurance coverage in connection with group health plans, the 

provisions of such part A shall apply. 

‘‘(b) EXCEPTION.—Notwithstanding subsection (a), the provisions of sections 2716 and 2718 of title XXVII of the Public Health 

Service Act (as amended by the Patient Protection and Affordable 

Care Act) shall not apply with respect to self-insured group health 

plans, and the provisions of this subchapter shall continue to apply 

to such plans as if such sections of the Public Health Service 

Act (as so amended) had not been enacted.’’. 

SEC. 1563. SENSE OF THE SENATE PROMOTING FISCAL RESPONSIBILITY. 

(a) FINDINGS.—The Senate makes the following findings: 

(1) Based on Congressional Budget Office (CBO) estimates, 

this Act will reduce the Federal deficit between 2010 and 2019. 

(2) CBO projects this Act will continue to reduce budget 

deficits after 2019. 
H. R. 3590—153 

(3) Based on CBO estimates, this Act will extend the solvency of the Medicare HI Trust Fund. 

(4) This Act will increase the surplus in the Social Security 

Trust Fund, which should be reserved to strengthen the 

finances of Social Security. 

(5) The initial net savings generated by the Community 

Living Assistance Services and Supports (CLASS) program are 

necessary to ensure the long-term solvency of that program. 

(b) SENSE OF THE SENATE.—It is the sense of the Senate that— 

(1) the additional surplus in the Social Security Trust 

Fund generated by this Act should be reserved for Social Security and not spent in this Act for other purposes; and 

(2) the net savings generated by the CLASS program should 

be reserved for the CLASS program and not spent in this 

Act for other purposes. 

TITLE II—ROLE OF PUBLIC PROGRAMS 

Subtitle A—Improved Access to Medicaid 

SEC. 2001. MEDICAID COVERAGE FOR THE LOWEST INCOME POPULATIONS. 

(a) COVERAGE FOR INDIVIDUALS WITH INCOME AT OR BELOW

133 PERCENT OF THE POVERTY LINE.— 

(1) BEGINNING 2014.—Section 1902(a)(10)(A)(i) of the Social 

Security Act (42 U.S.C. 1396a) is amended— 

(A) by striking ‘‘or’’ at the end of subclause (VI); 

(B) by adding ‘‘or’’ at the end of subclause (VII); and 

(C) by inserting after subclause (VII) the following: 

‘‘(VIII) beginning January 1, 2014, who are 

under 65 years of age, not pregnant, not entitled 

to, or enrolled for, benefits under part A of title 

XVIII, or enrolled for benefits under part B of 

title XVIII, and are not described in a previous 

subclause of this clause, and whose income (as 

determined under subsection (e)(14)) does not 

exceed 133 percent of the poverty line (as defined 

in section 2110(c)(5)) applicable to a family of the 

size involved, subject to subsection (k);’’. 

(2) PROVISION OF AT LEAST MINIMUM ESSENTIAL COVERAGE.— 

(A) IN GENERAL.—Section 1902 of such Act (42 U.S.C. 

1396a) is amended by inserting after subsection (j) the 

following: 

‘‘(k)(1) The medical assistance provided to an individual 

described in subclause (VIII) of subsection (a)(10)(A)(i) shall consist 

of benchmark coverage described in section 1937(b)(1) or benchmark 

equivalent coverage described in section 1937(b)(2). Such medical 

assistance shall be provided subject to the requirements of section 

1937, without regard to whether a State otherwise has elected 

the option to provide medical assistance through coverage under 

that section, unless an individual described in subclause (VIII) 

of subsection (a)(10)(A)(i) is also an individual for whom, under 

subparagraph (B) of section 1937(a)(2), the State may not require 

enrollment in benchmark coverage described in subsection (b)(1) 
H. R. 3590—154 

of section 1937 or benchmark equivalent coverage described in 

subsection (b)(2) of that section.’’. 

(B) CONFORMING AMENDMENT.—Section 1903(i) of the 

Social Security Act, as amended by section 6402(c), is 

amended— 

(i) in paragraph (24), by striking ‘‘or’’ at the end; 

(ii) in paragraph (25), by striking the period and 

inserting ‘‘; or’’; and 

(iii) by adding at the end the following: 

‘‘(26) with respect to any amounts expended for medical 

assistance for individuals described in subclause (VIII) of subsection (a)(10)(A)(i) other than medical assistance provided 

through benchmark coverage described in section 1937(b)(1) 

or benchmark equivalent coverage described in section 

1937(b)(2).’’. 

(3) FEDERAL FUNDING FOR COST OF COVERING NEWLY

ELIGIBLE INDIVIDUALS.—Section 1905 of the Social Security Act 

(42 U.S.C. 1396d), is amended— 

(A) in subsection (b), in the first sentence, by inserting 

‘‘subsection (y) and’’ before ‘‘section 1933(d)’’; and 

(B) by adding at the end the following new subsection: 

‘‘(y) INCREASED FMAP FOR MEDICAL ASSISTANCE FOR NEWLY

ELIGIBLE MANDATORY INDIVIDUALS.— 

‘‘(1) AMOUNT OF INCREASE.— 

‘‘(A) 100 PERCENT FMAP.—During the period that begins 

on January 1, 2014, and ends on December 31, 2016, notwithstanding subsection (b), the Federal medical assistance 

percentage determined for a State that is one of the 50 

States or the District of Columbia for each fiscal year 

occurring during that period with respect to amounts 

expended for medical assistance for newly eligible individuals described in subclause (VIII) of section 

1902(a)(10)(A)(i) shall be equal to 100 percent. 

‘‘(B) 2017 AND 2018.— 

‘‘(i) IN GENERAL.—During the period that begins 

on January 1, 2017, and ends on December 31, 2018, 

notwithstanding subsection (b) and subject to subparagraph (D), the Federal medical assistance percentage 

determined for a State that is one of the 50 States 

or the District of Columbia for each fiscal year occurring during that period with respect to amounts 

expended for medical assistance for newly eligible 

individuals described in subclause (VIII) of section 

1902(a)(10)(A)(i), shall be increased by the applicable 

percentage point increase specified in clause (ii) for 

the quarter and the State. 

‘‘(ii) APPLICABLE PERCENTAGE POINT INCREASE.— 

‘‘(I) IN GENERAL.—For purposes of clause (i), 

the applicable percentage point increase for a 

quarter is the following: 
H. R. 3590—155 

‘‘For any fiscal year quarter occurring in the calendar year: 

If the State is an expansion State, the applicable 

percentage point increase 

is: 

If the State is not an expansion State, the applicable percentage point increase is: 

2017 30.3 34.3 

2018 31.3 33.3 

‘‘(II) EXPANSION STATE DEFINED.—For purposes 

of the table in subclause (I), a State is an expansion State if, on the date of the enactment of 

the Patient Protection and Affordable Care Act, 

the State offers health benefits coverage statewide 

to parents and nonpregnant, childless adults whose 

income is at least 100 percent of the poverty line, 

that is not dependent on access to employer coverage, employer contribution, or employment and 

is not limited to premium assistance, hospital-only 

benefits, a high deductible health plan, or alternative benefits under a demonstration program 

authorized under section 1938. A State that offers 

health benefits coverage to only parents or only 

nonpregnant childless adults described in the preceding sentence shall not be considered to be an 

expansion State. 

‘‘(C) 2019 AND SUCCEEDING YEARS.—Beginning January 

1, 2019, notwithstanding subsection (b) but subject to 

subparagraph (D), the Federal medical assistance percentage determined for a State that is one of the 50 States 

or the District of Columbia for each fiscal year quarter 

occurring during that period with respect to amounts 

expended for medical assistance for newly eligible individuals described in subclause (VIII) of section 

1902(a)(10)(A)(i), shall be increased by 32.3 percentage 

points. 

‘‘(D) LIMITATION.—The Federal medical assistance 

percentage determined for a State under subparagraph 

(B) or (C) shall in no case be more than 95 percent. 

‘‘(2) DEFINITIONS.—In this subsection: 

‘‘(A) NEWLY ELIGIBLE.—The term ‘newly eligible’ 

means, with respect to an individual described in subclause 

(VIII) of section 1902(a)(10)(A)(i), an individual who is not 

under 19 years of age (or such higher age as the State 

may have elected) and who, on the date of enactment 

of the Patient Protection and Affordable Care Act, is not 

eligible under the State plan or under a waiver of the 

plan for full benefits or for benchmark coverage described 

in subparagraph (A), (B), or (C) of section 1937(b)(1) or 

benchmark equivalent coverage described in section 

1937(b)(2) that has an aggregate actuarial value that is 

at least actuarially equivalent to benchmark coverage 

described in subparagraph (A), (B), or (C) of section 

1937(b)(1), or is eligible but not enrolled (or is on a waiting 

list) for such benefits or coverage through a waiver under 

the plan that has a capped or limited enrollment that 

is full. 
H. R. 3590—156 

‘‘(B) FULL BENEFITS.—The term ‘full benefits’ means, 

with respect to an individual, medical assistance for all 

services covered under the State plan under this title that 

is not less in amount, duration, or scope, or is determined 

by the Secretary to be substantially equivalent, to the 

medical assistance available for an individual described 

in section 1902(a)(10)(A)(i).’’. 

(4) STATE OPTIONS TO OFFER COVERAGE EARLIER AND

PRESUMPTIVE ELIGIBILITY; CHILDREN REQUIRED TO HAVE COV- ERAGE FOR PARENTS TO BE ELIGIBLE.— (A) IN GENERAL.—Subsection (k) of section 1902 of 

the Social Security Act (as added by paragraph (2)), is 

amended by inserting after paragraph (1) the following: 

‘‘(2) Beginning with the first day of any fiscal year quarter 

that begins on or after January 1, 2011, and before January 1, 

2014, a State may elect through a State plan amendment to provide 

medical assistance to individuals who would be described in subclause (VIII) of subsection (a)(10)(A)(i) if that subclause were effective before January 1, 2014. A State may elect to phase-in the 

extension of eligibility for medical assistance to such individuals 

based on income, so long as the State does not extend such eligibility 

to individuals described in such subclause with higher income before 

making individuals described in such subclause with lower income 

eligible for medical assistance. 

‘‘(3) If an individual described in subclause (VIII) of subsection 

(a)(10)(A)(i) is the parent of a child who is under 19 years of 

age (or such higher age as the State may have elected) who is 

eligible for medical assistance under the State plan or under a 

waiver of such plan (under that subclause or under a State plan 

amendment under paragraph (2), the individual may not be enrolled 

under the State plan unless the individual’s child is enrolled under 

the State plan or under a waiver of the plan or is enrolled in 

other health insurance coverage. For purposes of the preceding 

sentence, the term ‘parent’ includes an individual treated as a 

caretaker relative for purposes of carrying out section 1931.’’. 

(B) PRESUMPTIVE ELIGIBILITY.—Section 1920 of the 

Social Security Act (42 U.S.C. 1396r–1) is amended by 

adding at the end the following: 

‘‘(e) If the State has elected the option to provide a presumptive 

eligibility period under this section or section 1920A, the State 

may elect to provide a presumptive eligibility period (as defined 

in subsection (b)(1)) for individuals who are eligible for medical 

assistance under clause (i)(VIII) of subsection (a)(10)(A) or section 

1931 in the same manner as the State provides for such a period 

under this section or section 1920A, subject to such guidance as 

the Secretary shall establish.’’. 

(5) CONFORMING AMENDMENTS.— (A) Section 1902(a)(10) of such Act (42 U.S.C. 

1396a(a)(10)) is amended in the matter following subparagraph (G), by striking ‘‘and (XIV)’’ and inserting ‘‘(XIV)’’ 

and by inserting ‘‘and (XV) the medical assistance made 

available to an individual described in subparagraph 

(A)(i)(VIII) shall be limited to medical assistance described 

in subsection (k)(1)’’ before the semicolon. 

(B) Section 1902(l)(2)(C) of such Act (42 U.S.C. 

1396a(l)(2)(C)) is amended by striking ‘‘100’’ and inserting 

‘‘133’’. 
H. R. 3590—157 

(C) Section 1905(a) of such Act (42 U.S.C. 1396d(a)) 

is amended in the matter preceding paragraph (1)— 

(i) by striking ‘‘or’’ at the end of clause (xii); 

(ii) by inserting ‘‘or’’ at the end of clause (xiii); 

and 

(iii) by inserting after clause (xiii) the following: 

‘‘(xiv) individuals described in section 

1902(a)(10)(A)(i)(VIII),’’. 

(D) Section 1903(f)(4) of such Act (42 U.S.C. 1396b(f)(4)) 

is amended by inserting ‘‘1902(a)(10)(A)(i)(VIII),’’ after 

‘‘1902(a)(10)(A)(i)(VII),’’. 

(E) Section 1937(a)(1)(B) of such Act (42 U.S.C. 1396u– 

7(a)(1)(B)) is amended by inserting ‘‘subclause (VIII) of 

section 1902(a)(10)(A)(i) or under’’ after ‘‘eligible under’’. 

(b) MAINTENANCE OF MEDICAID INCOME ELIGIBILITY.—Section 

1902 of the Social Security Act (42 U.S.C. 1396a) is amended— 

(1) in subsection (a)— 

(A) by striking ‘‘and’’ at the end of paragraph (72); 

(B) by striking the period at the end of paragraph 

(73) and inserting ‘‘; and’’; and 

(C) by inserting after paragraph (73) the following 

new paragraph: 

‘‘(74) provide for maintenance of effort under the State 

plan or under any waiver of the plan in accordance with subsection (gg).’’; and 

(2) by adding at the end the following new subsection: 

‘‘(gg) MAINTENANCE OF EFFORT.— ‘‘(1) GENERAL REQUIREMENT TO MAINTAIN ELIGIBILITY

STANDARDS UNTIL STATE EXCHANGE IS FULLY OPERATIONAL.— 

Subject to the succeeding paragraphs of this subsection, during 

the period that begins on the date of enactment of the Patient 

Protection and Affordable Care Act and ends on the date on 

which the Secretary determines that an Exchange established 

by the State under section 1311 of the Patient Protection and 

Affordable Care Act is fully operational, as a condition for 

receiving any Federal payments under section 1903(a) for calendar quarters occurring during such period, a State shall 

not have in effect eligibility standards, methodologies, or procedures under the State plan under this title or under any waiver 

of such plan that is in effect during that period, that are 

more restrictive than the eligibility standards, methodologies, 

or procedures, respectively, under the plan or waiver that are 

in effect on the date of enactment of the Patient Protection 

and Affordable Care Act. 

‘‘(2) CONTINUATION OF ELIGIBILITY STANDARDS FOR CHILDREN UNTIL OCTOBER 1, 2019.—The requirement under paragraph (1) shall continue to apply to a State through September 

30, 2019, with respect to the eligibility standards, methodologies, and procedures under the State plan under this title 

or under any waiver of such plan that are applicable to determining the eligibility for medical assistance of any child who 

is under 19 years of age (or such higher age as the State 

may have elected). 

‘‘(3) NONAPPLICATION.—During the period that begins on 

January 1, 2011, and ends on December 31, 2013, the requirement under paragraph (1) shall not apply to a State with 

respect to nonpregnant, nondisabled adults who are eligible 
H. R. 3590—158 

for medical assistance under the State plan or under a waiver 

of the plan at the option of the State and whose income exceeds 

133 percent of the poverty line (as defined in section 2110(c)(5)) 

applicable to a family of the size involved if, on or after 

December 31, 2010, the State certifies to the Secretary that, 

with respect to the State fiscal year during which the certification is made, the State has a budget deficit, or with respect 

to the succeeding State fiscal year, the State is projected to 

have a budget deficit. Upon submission of such a certification 

to the Secretary, the requirement under paragraph (1) shall 

not apply to the State with respect to any remaining portion 

of the period described in the preceding sentence. 

‘‘(4) DETERMINATION OF COMPLIANCE.— 

‘‘(A) STATES SHALL APPLY MODIFIED GROSS INCOME.— 

A State’s determination of income in accordance with subsection (e)(14) shall not be considered to be eligibility standards, methodologies, or procedures that are more restrictive 

than the standards, methodologies, or procedures in effect 

under the State plan or under a waiver of the plan on 

the date of enactment of the Patient Protection and Affordable Care Act for purposes of determining compliance with 

the requirements of paragraph (1), (2), or (3). 

‘‘(B) STATES MAY EXPAND ELIGIBILITY OR MOVE

WAIVERED POPULATIONS INTO COVERAGE UNDER THE STATE

PLAN.—With respect to any period applicable under paragraph (1), (2), or (3), a State that applies eligibility standards, methodologies, or procedures under the State plan 

under this title or under any waiver of the plan that 

are less restrictive than the eligibility standards, methodologies, or procedures, applied under the State plan or 

under a waiver of the plan on the date of enactment of 

the Patient Protection and Affordable Care Act, or that 

makes individuals who, on such date of enactment, are 

eligible for medical assistance under a waiver of the State 

plan, after such date of enactment eligible for medical 

assistance through a State plan amendment with an income 

eligibility level that is not less than the income eligibility 

level that applied under the waiver, or as a result of 

the application of subclause (VIII) of section 

1902(a)(10)(A)(i), shall not be considered to have in effect 

eligibility standards, methodologies, or procedures that are 

more restrictive than the standards, methodologies, or 

procedures in effect under the State plan or under a waiver 

of the plan on the date of enactment of the Patient Protection and Affordable Care Act for purposes of determining 

compliance with the requirements of paragraph (1), (2), 

or (3).’’. 

(c) MEDICAID BENCHMARK BENEFITS MUST CONSIST OF AT LEAST

MINIMUM ESSENTIAL COVERAGE.—Section 1937(b) of such Act (42 

U.S.C. 1396u–7(b)) is amended— 

(1) in paragraph (1), in the matter preceding subparagraph 

(A), by inserting ‘‘subject to paragraphs (5) and (6),’’ before 

‘‘each’’; 

(2) in paragraph (2)— 

(A) in the matter preceding subparagraph (A), by 

inserting ‘‘subject to paragraphs (5) and (6)’’ after ‘‘subsection (a)(1),’’; 
H. R. 3590—159 

(B) in subparagraph (A)— 

(i) by redesignating clauses (iv) and (v) as clauses 

(vi) and (vii), respectively; and 

(ii) by inserting after clause (iii), the following: 

‘‘(iv) Coverage of prescription drugs. 

‘‘(v) Mental health services.’’; and 

(C) in subparagraph (C)— 

(i) by striking clauses (i) and (ii); and 

(ii) by redesignating clauses (iii) and (iv) as clauses 

(i) and (ii), respectively; and 

(3) by adding at the end the following new paragraphs: 

‘‘(5) MINIMUM STANDARDS.—Effective January 1, 2014, any 

benchmark benefit package under paragraph (1) or benchmark 

equivalent coverage under paragraph (2) must provide at least 

essential health benefits as described in section 1302(b) of 

the Patient Protection and Affordable Care Act. 

‘‘(6) MENTAL HEALTH SERVICES PARITY.— 

‘‘(A) IN GENERAL.—In the case of any benchmark benefit package under paragraph (1) or benchmark equivalent 

coverage under paragraph (2) that is offered by an entity 

that is not a medicaid managed care organization and 

that provides both medical and surgical benefits and mental 

health or substance use disorder benefits, the entity shall 

ensure that the financial requirements and treatment 

limitations applicable to such mental health or substance 

use disorder benefits comply with the requirements of section 2705(a) of the Public Health Service Act in the same 

manner as such requirements apply to a group health 

plan. 

‘‘(B) DEEMED COMPLIANCE.—Coverage provided with 

respect to an individual described in section 1905(a)(4)(B) 

and covered under the State plan under section 

1902(a)(10)(A) of the services described in section 

1905(a)(4)(B) (relating to early and periodic screening, diagnostic, and treatment services defined in section 1905(r)) 

and provided in accordance with section 1902(a)(43), shall 

be deemed to satisfy the requirements of subparagraph 

(A).’’. 

(d) ANNUAL REPORTS ON MEDICAID ENROLLMENT.— 

(1) STATE REPORTS.—Section 1902(a) of the Social Security 

Act (42 U.S.C. 1396a(a)), as amended by subsection (b), is 

amended— 

(A) by striking ‘‘and’’ at the end of paragraph (73); 

(B) by striking the period at the end of paragraph 

(74) and inserting ‘‘; and’’; and 

(C) by inserting after paragraph (74) the following 

new paragraph: 

‘‘(75) provide that, beginning January 2015, and annually 

thereafter, the State shall submit a report to the Secretary 

that contains— 

‘‘(A) the total number of enrolled and newly enrolled 

individuals in the State plan or under a waiver of the 

plan for the fiscal year ending on September 30 of the 

preceding calendar year, disaggregated by population, 

including children, parents, nonpregnant childless adults, 

disabled individuals, elderly individuals, and such other 
H. R. 3590—160 

categories or sub-categories of individuals eligible for medical assistance under the State plan or under a waiver 

of the plan as the Secretary may require; 

‘‘(B) a description, which may be specified by population, of the outreach and enrollment processes used by 

the State during such fiscal year; and 

‘‘(C) any other data reporting determined necessary 

by the Secretary to monitor enrollment and retention of 

individuals eligible for medical assistance under the State 

plan or under a waiver of the plan.’’. 

(2) REPORTS TO CONGRESS.—Beginning April 2015, and 

annually thereafter, the Secretary of Health and Human Services shall submit a report to the appropriate committees of 

Congress on the total enrollment and new enrollment in Medicaid for the fiscal year ending on September 30 of the preceding 

calendar year on a national and State-by-State basis, and shall 

include in each such report such recommendations for administrative or legislative changes to improve enrollment in the 

Medicaid program as the Secretary determines appropriate. 

(e) STATE OPTION FOR COVERAGE FOR INDIVIDUALS WITH

INCOME THAT EXCEEDS 133 PERCENT OF THE POVERTY LINE.— 

(1) COVERAGE AS OPTIONAL CATEGORICALLY NEEDY GROUP.— 

Section 1902 of the Social Security Act (42 U.S.C. 1396a) is 

amended— 

(A) in subsection (a)(10)(A)(ii)— 

(i) in subclause (XVIII), by striking ‘‘or’’ at the 

end; 

(ii) in subclause (XIX), by adding ‘‘or’’ at the end; 

and 

(iii) by adding at the end the following new subclause: 

‘‘(XX) beginning January 1, 2014, who are 

under 65 years of age and are not described in 

or enrolled under a previous subclause of this 

clause, and whose income (as determined under 

subsection (e)(14)) exceeds 133 percent of the poverty line (as defined in section 2110(c)(5)) 

applicable to a family of the size involved but 

does not exceed the highest income eligibility level 

established under the State plan or under a waiver 

of the plan, subject to subsection (hh);’’ and 

(B) by adding at the end the following new subsection: 

‘‘(hh)(1) A State may elect to phase-in the extension of eligibility 

for medical assistance to individuals described in subclause (XX) 

of subsection (a)(10)(A)(ii) based on the categorical group (including 

nonpregnant childless adults) or income, so long as the State does 

not extend such eligibility to individuals described in such subclause 

with higher income before making individuals described in such 

subclause with lower income eligible for medical assistance. 

‘‘(2) If an individual described in subclause (XX) of subsection 

(a)(10)(A)(ii) is the parent of a child who is under 19 years of 

age (or such higher age as the State may have elected) who is 

eligible for medical assistance under the State plan or under a 

waiver of such plan, the individual may not be enrolled under 

the State plan unless the individual’s child is enrolled under the 

State plan or under a waiver of the plan or is enrolled in other 

health insurance coverage. For purposes of the preceding sentence, 
H. R. 3590—161 

the term ‘parent’ includes an individual treated as a caretaker 

relative for purposes of carrying out section 1931.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Section 1905(a) of such Act (42 U.S.C. 1396d(a)), 

as amended by subsection (a)(5)(C), is amended in the 

matter preceding paragraph (1)— 

(i) by striking ‘‘or’’ at the end of clause (xiii); 

(ii) by inserting ‘‘or’’ at the end of clause (xiv); 

and 

(iii) by inserting after clause (xiv) the following: 

‘‘(xv) individuals described in section 

1902(a)(10)(A)(ii)(XX),’’. 

(B) Section 1903(f)(4) of such Act (42 U.S.C. 1396b(f)(4)) 

is amended by inserting ‘‘1902(a)(10)(A)(ii)(XX),’’ after 

‘‘1902(a)(10)(A)(ii)(XIX),’’. 

(C) Section 1920(e) of such Act (42 U.S.C. 1396r–1(e)), 

as added by subsection (a)(4)(B), is amended by inserting 

‘‘or clause (ii)(XX)’’ after ‘‘clause (i)(VIII)’’. 

SEC. 2002. INCOME ELIGIBILITY FOR NONELDERLY DETERMINED 

USING MODIFIED GROSS INCOME. 

(a) IN GENERAL.—Section 1902(e) of the Social Security Act 

(42 U.S.C. 1396a(e)) is amended by adding at the end the following: 

‘‘(14) INCOME DETERMINED USING MODIFIED GROSS

INCOME.— 

‘‘(A) IN GENERAL.—Notwithstanding subsection (r) or 

any other provision of this title, except as provided in 

subparagraph (D), for purposes of determining income eligibility for medical assistance under the State plan or under 

any waiver of such plan and for any other purpose 

applicable under the plan or waiver for which a determination of income is required, including with respect to the 

imposition of premiums and cost-sharing, a State shall 

use the modified gross income of an individual and, in 

the case of an individual in a family greater than 1, the 

household income of such family. A State shall establish 

income eligibility thresholds for populations to be eligible 

for medical assistance under the State plan or a waiver 

of the plan using modified gross income and household 

income that are not less than the effective income eligibility 

levels that applied under the State plan or waiver on 

the date of enactment of the Patient Protection and Affordable Care Act. For purposes of complying with the maintenance of effort requirements under subsection (gg) during 

the transition to modified gross income and household 

income, a State shall, working with the Secretary, establish 

an equivalent income test that ensures individuals eligible 

for medical assistance under the State plan or under a 

waiver of the plan on the date of enactment of the Patient 

Protection and Affordable Care Act, do not lose coverage 

under the State plan or under a waiver of the plan. The 

Secretary may waive such provisions of this title and title 

XXI as are necessary to ensure that States establish income 

and eligibility determination systems that protect beneficiaries. 

‘‘(B) NO INCOME OR EXPENSE DISREGARDS.—No type 

of expense, block, or other income disregard shall be applied 
H. R. 3590—162 

by a State to determine income eligibility for medical assistance under the State plan or under any waiver of such 

plan or for any other purpose applicable under the plan 

or waiver for which a determination of income is required. 

‘‘(C) NO ASSETS TEST.—A State shall not apply any 

assets or resources test for purposes of determining eligibility for medical assistance under the State plan or under 

a waiver of the plan. 

‘‘(D) EXCEPTIONS.— 

‘‘(i) INDIVIDUALS ELIGIBLE BECAUSE OF OTHER AID

OR ASSISTANCE, ELDERLY INDIVIDUALS, MEDICALLY

NEEDY INDIVIDUALS, AND INDIVIDUALS ELIGIBLE FOR

MEDICARE COST-SHARING.—Subparagraphs (A), (B), and 

(C) shall not apply to the determination of eligibility 

under the State plan or under a waiver for medical 

assistance for the following: 

‘‘(I) Individuals who are eligible for medical 

assistance under the State plan or under a waiver 

of the plan on a basis that does not require a 

determination of income by the State agency 

administering the State plan or waiver, including 

as a result of eligibility for, or receipt of, other 

Federal or State aid or assistance, individuals who 

are eligible on the basis of receiving (or being 

treated as if receiving) supplemental security 

income benefits under title XVI, and individuals 

who are eligible as a result of being or being 

deemed to be a child in foster care under the 

responsibility of the State. 

‘‘(II) Individuals who have attained age 65. 

‘‘(III) Individuals who qualify for medical 

assistance under the State plan or under any 

waiver of such plan on the basis of being blind 

or disabled (or being treated as being blind or 

disabled) without regard to whether the individual 

is eligible for supplemental security income benefits under title XVI on the basis of being blind 

or disabled and including an individual who is 

eligible for medical assistance on the basis of section 1902(e)(3). 

‘‘(IV) Individuals described in subsection 

(a)(10)(C). 

‘‘(V) Individuals described in any clause of subsection (a)(10)(E). 

‘‘(ii) EXPRESS LANE AGENCY FINDINGS.—In the case 

of a State that elects the Express Lane option under 

paragraph (13), notwithstanding subparagraphs (A), 

(B), and (C), the State may rely on a finding made 

by an Express Lane agency in accordance with that 

paragraph relating to the income of an individual for 

purposes of determining the individual’s eligibility for 

medical assistance under the State plan or under a 

waiver of the plan. 

‘‘(iii) MEDICARE PRESCRIPTION DRUG SUBSIDIES

DETERMINATIONS.—Subparagraphs (A), (B), and (C) 

shall not apply to any determinations of eligibility 

for premium and cost-sharing subsidies under and in 
H. R. 3590—163 

accordance with section 1860D–14 made by the State 

pursuant to section 1935(a)(2). 

‘‘(iv) LONG-TERM CARE.—Subparagraphs (A), (B), 

and (C) shall not apply to any determinations of eligibility of individuals for purposes of medical assistance 

for nursing facility services, a level of care in any 

institution equivalent to that of nursing facility services, home or community-based services furnished 

under a waiver or State plan amendment under section 

1915 or a waiver under section 1115, and services 

described in section 1917(c)(1)(C)(ii). 

‘‘(v) GRANDFATHER OF CURRENT ENROLLEES UNTIL

DATE OF NEXT REGULAR REDETERMINATION.—An individual who, on January 1, 2014, is enrolled in the 

State plan or under a waiver of the plan and who 

would be determined ineligible for medical assistance 

solely because of the application of the modified gross 

income or household income standard described in 

subparagraph (A), shall remain eligible for medical 

assistance under the State plan or waiver (and subject 

to the same premiums and cost-sharing as applied 

to the individual on that date) through March 31, 

2014, or the date on which the individual’s next regularly scheduled redetermination of eligibility is to 

occur, whichever is later. 

‘‘(E) TRANSITION PLANNING AND OVERSIGHT.—Each 

State shall submit to the Secretary for the Secretary’s 

approval the income eligibility thresholds proposed to be 

established using modified gross income and household 

income, the methodologies and procedures to be used to 

determine income eligibility using modified gross income 

and household income and, if applicable, a State plan 

amendment establishing an optional eligibility category 

under subsection (a)(10)(A)(ii)(XX). To the extent practicable, the State shall use the same methodologies and 

procedures for purposes of making such determinations 

as the State used on the date of enactment of the Patient 

Protection and Affordable Care Act. The Secretary shall 

ensure that the income eligibility thresholds proposed to 

be established using modified gross income and household 

income, including under the eligibility category established 

under subsection (a)(10)(A)(ii)(XX), and the methodologies 

and procedures proposed to be used to determine income 

eligibility, will not result in children who would have been 

eligible for medical assistance under the State plan or 

under a waiver of the plan on the date of enactment of 

the Patient Protection and Affordable Care Act no longer 

being eligible for such assistance. 

‘‘(F) LIMITATION ON SECRETARIAL AUTHORITY.—The Secretary shall not waive compliance with the requirements 

of this paragraph except to the extent necessary to permit 

a State to coordinate eligibility requirements for dual 

eligible individuals (as defined in section 1915(h)(2)(B)) 

under the State plan or under a waiver of the plan and 

under title XVIII and individuals who require the level 

of care provided in a hospital, a nursing facility, or an 

intermediate care facility for the mentally retarded. 
H. R. 3590—164 

‘‘(G) DEFINITIONS OF MODIFIED GROSS INCOME AND

HOUSEHOLD INCOME.—In this paragraph, the terms ‘modified gross income’ and ‘household income’ have the 

meanings given such terms in section 36B(d)(2) of the 

Internal Revenue Code of 1986. 

‘‘(H) CONTINUED APPLICATION OF MEDICAID RULES

REGARDING POINT-IN-TIME INCOME AND SOURCES OF

INCOME.—The requirement under this paragraph for States 

to use modified gross income and household income to 

determine income eligibility for medical assistance under 

the State plan or under any waiver of such plan and 

for any other purpose applicable under the plan or waiver 

for which a determination of income is required shall not 

be construed as affecting or limiting the application of— 

‘‘(i) the requirement under this title and under 

the State plan or a waiver of the plan to determine 

an individual’s income as of the point in time at which 

an application for medical assistance under the State 

plan or a waiver of the plan is processed; or 

‘‘(ii) any rules established under this title or under 

the State plan or a waiver of the plan regarding sources 

of countable income.’’. 

(b) CONFORMING AMENDMENT.—Section 1902(a)(17) of such Act 

(42 U.S.C. 1396a(a)(17)) is amended by inserting ‘‘(e)(14),’’ before 

‘‘(l)(3)’’. 

(c) EFFECTIVE DATE.—The amendments made by subsections 

(a) and (b) take effect on January 1, 2014. 

SEC. 2003. REQUIREMENT TO OFFER PREMIUM ASSISTANCE FOR 

EMPLOYER-SPONSORED INSURANCE. 

(a) IN GENERAL.—Section 1906A of such Act (42 U.S.C. 1396e– 

1) is amended— 

(1) in subsection (a)— 

(A) by striking ‘‘may elect to’’ and inserting ‘‘shall’’; 

(B) by striking ‘‘under age 19’’; and 

(C) by inserting ‘‘, in the case of an individual under 

age 19,’’ after ‘‘(and’’; 

(2) in subsection (c), in the first sentence, by striking ‘‘under 

age 19’’; and 

(3) in subsection (d)— 

(A) in paragraph (2)— 

(i) in the first sentence, by striking ‘‘under age 

19’’; and 

(ii) by striking the third sentence and inserting 

‘‘A State may not require, as a condition of an individual (or the individual’s parent) being or remaining 

eligible for medical assistance under this title, that 

the individual (or the individual’s parent) apply for 

enrollment in qualified employer-sponsored coverage 

under this section.’’; and 

(B) in paragraph (3), by striking ‘‘the parent of an 

individual under age 19’’ and inserting ‘‘an individual (or 

the parent of an individual)’’; and 

(4) in subsection (e), by striking ‘‘under age 19’’ each place 

it appears. 
H. R. 3590—165 

(b) CONFORMING AMENDMENT.—The heading for section 1906A 

of such Act (42 U.S.C. 1396e–1) is amended by striking ‘‘OPTION

FOR CHILDREN’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

take effect on January 1, 2014. 

SEC. 2004. MEDICAID COVERAGE FOR FORMER FOSTER CARE CHILDREN. 

(a) IN GENERAL.—Section 1902(a)(10)(A)(i) of the Social Security 

Act (42 U.S.C. 1396a), as amended by section 2001(a)(1), is 

amended— 

(1) by striking ‘‘or’’ at the end of subclause (VII); 

(2) by adding ‘‘or’’ at the end of subclause (VIII); and 

(3) by inserting after subclause (VIII) the following: 

‘‘(IX) who were in foster care under the responsibility of a State for more than 6 months (whether 

or not consecutive) but are no longer in such care, 

who are not described in any of subclauses (I) 

through (VII) of this clause, and who are under 

25 years of age;’’. 

(b) OPTION TO PROVIDE PRESUMPTIVE ELIGIBILITY.—Section 

1920(e) of such Act (42 U.S.C. 1396r–1(e)), as added by section 

2001(a)(4)(B) and amended by section 2001(e)(2)(C), is amended 

by inserting ‘‘, clause (i)(IX),’’ after ‘‘clause (i)(VIII)’’. 

(c) CONFORMING AMENDMENTS.— (1) Section 1903(f)(4) of such Act (42 U.S.C. 1396b(f)(4)), 

as amended by section 2001(a)(5)(D), is amended by inserting 

‘‘1902(a)(10)(A)(i)(IX),’’ after ‘‘1902(a)(10)(A)(i)(VIII),’’. 

(2) Section 1937(a)(2)(B)(viii) of such Act (42 U.S.C. 1396u– 

7(a)(2)(B)(viii)) is amended by inserting ‘‘, or the individual 

qualifies for medical assistance on the basis of section 

1902(a)(10)(A)(i)(IX)’’ before the period. 

(d) EFFECTIVE DATE.—The amendments made by this section 

take effect on January 1, 2019. 

SEC. 2005. PAYMENTS TO TERRITORIES. 

(a) INCREASE IN LIMIT ON PAYMENTS.—Section 1108(g) of the 

Social Security Act (42 U.S.C. 1308(g)) is amended— 

(1) in paragraph (2), in the matter preceding subparagraph 

(A), by striking ‘‘paragraph (3)’’ and inserting ‘‘paragraphs (3) 

and (5)’’; 

(2) in paragraph (4), by striking ‘‘and (3)’’ and inserting 

‘‘(3), and (4)’’; and 

(3) by adding at the end the following paragraph: 

‘‘(5) FISCAL YEAR 2011 AND THEREAFTER.—The amounts 

otherwise determined under this subsection for Puerto Rico, 

the Virgin Islands, Guam, the Northern Mariana Islands, and 

American Samoa for the second, third, and fourth quarters 

of fiscal year 2011, and for each fiscal year after fiscal year 

2011 (after the application of subsection (f) and the preceding 

paragraphs of this subsection), shall be increased by 30 percent.’’. 

(b) DISREGARD OF PAYMENTS FOR MANDATORY EXPANDED

ENROLLMENT.—Section 1108(g)(4) of such Act (42 U.S.C. 1308(g)(4)) 

is amended— 

(1) by striking ‘‘to fiscal years beginning’’ and inserting 

‘‘to— 

‘‘(A) fiscal years beginning’’; 
H. R. 3590—166 

(2) by striking the period at the end and inserting ‘‘; and’’; 

and 

(3) by adding at the end the following: 

‘‘(B) fiscal years beginning with fiscal year 2014, payments made to Puerto Rico, the Virgin Islands, Guam, 

the Northern Mariana Islands, or American Samoa with 

respect to amounts expended for medical assistance for 

newly eligible (as defined in section 1905(y)(2)) nonpregnant childless adults who are eligible under subclause 

(VIII) of section 1902(a)(10)(A)(i) and whose income (as 

determined under section 1902(e)(14)) does not exceed (in 

the case of each such commonwealth and territory respectively) the income eligibility level in effect for that population under title XIX or under a waiver on the date of 

enactment of the Patient Protection and Affordable Care 

Act, shall not be taken into account in applying subsection 

(f) (as increased in accordance with paragraphs (1), (2), 

(3), and (5) of this subsection) to such commonwealth or 

territory for such fiscal year.’’. 

(c) INCREASED FMAP.— 

(1) IN GENERAL.—The first sentence of section 1905(b) of 

the Social Security Act (42 U.S.C. 1396d(b)) is amended by 

striking ‘‘shall be 50 per centum’’ and inserting ‘‘shall be 55 

percent’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) takes effect on January 1, 2011. 

SEC. 2006. SPECIAL ADJUSTMENT TO FMAP DETERMINATION FOR CERTAIN STATES RECOVERING FROM A MAJOR DISASTER. 

Section 1905 of the Social Security Act (42 U.S.C. 1396d), 

as amended by sections 2001(a)(3) and 2001(b)(2), is amended— 

(1) in subsection (b), in the first sentence, by striking 

‘‘subsection (y)’’ and inserting ‘‘subsections (y) and (aa)’’; and 

(2) by adding at the end the following new subsection: 

‘‘(aa)(1) Notwithstanding subsection (b), beginning January 1, 

2011, the Federal medical assistance percentage for a fiscal year 

for a disaster-recovery FMAP adjustment State shall be equal to 

the following: 

‘‘(A) In the case of the first fiscal year (or part of a fiscal 

year) for which this subsection applies to the State, the Federal 

medical assistance percentage determined for the fiscal year 

without regard to this subsection and subsection (y), increased 

by 50 percent of the number of percentage points by which 

the Federal medical assistance percentage determined for the 

State for the fiscal year without regard to this subsection 

and subsection (y), is less than the Federal medical assistance 

percentage determined for the State for the preceding fiscal 

year after the application of only subsection (a) of section 5001 

of Public Law 111–5 (if applicable to the preceding fiscal year) 

and without regard to this subsection, subsection (y), and subsections (b) and (c) of section 5001 of Public Law 111–5. 

‘‘(B) In the case of the second or any succeeding fiscal 

year for which this subsection applies to the State, the Federal 

medical assistance percentage determined for the preceding 

fiscal year under this subsection for the State, increased by 

25 percent of the number of percentage points by which the 

Federal medical assistance percentage determined for the State 
H. R. 3590—167 

for the fiscal year without regard to this subsection and subsection (y), is less than the Federal medical assistance percentage determined for the State for the preceding fiscal year 

under this subsection. 

‘‘(2) In this subsection, the term ‘disaster-recovery FMAP 

adjustment State’ means a State that is one of the 50 States 

or the District of Columbia, for which, at any time during the 

preceding 7 fiscal years, the President has declared a major disaster 

under section 401 of the Robert T. Stafford Disaster Relief and 

Emergency Assistance Act and determined as a result of such 

disaster that every county or parish in the State warrant individual 

and public assistance or public assistance from the Federal Government under such Act and for which— 

‘‘(A) in the case of the first fiscal year (or part of a fiscal 

year) for which this subsection applies to the State, the Federal 

medical assistance percentage determined for the State for 

the fiscal year without regard to this subsection and subsection 

(y), is less than the Federal medical assistance percentage 

determined for the State for the preceding fiscal year after 

the application of only subsection (a) of section 5001 of Public 

Law 111–5 (if applicable to the preceding fiscal year) and 

without regard to this subsection, subsection (y), and subsections (b) and (c) of section 5001 of Public Law 111–5, by 

at least 3 percentage points; and 

‘‘(B) in the case of the second or any succeeding fiscal 

year for which this subsection applies to the State, the Federal 

medical assistance percentage determined for the State for 

the fiscal year without regard to this subsection and subsection 

(y), is less than the Federal medical assistance percentage 

determined for the State for the preceding fiscal year under 

this subsection by at least 3 percentage points. 

‘‘(3) The Federal medical assistance percentage determined for 

a disaster-recovery FMAP adjustment State under paragraph (1) 

shall apply for purposes of this title (other than with respect to 

disproportionate share hospital payments described in section 1923 

and payments under this title that are based on the enhanced 

FMAP described in 2105(b)) and shall not apply with respect to 

payments under title IV (other than under part E of title IV) 

or payments under title XXI.’’. 

SEC. 2007. MEDICAID IMPROVEMENT FUND RESCISSION. 

(a) RESCISSION.—Any amounts available to the Medicaid 

Improvement Fund established under section 1941 of the Social 

Security Act (42 U.S.C. 1396w–1) for any of fiscal years 2014 

through 2018 that are available for expenditure from the Fund 

and that are not so obligated as of the date of the enactment 

of this Act are rescinded. 

(b) CONFORMING AMENDMENTS.—Section 1941(b)(1) of the Social 

Security Act (42 U.S.C. 1396w–1(b)(1)) is amended— 

(1) in subparagraph (A), by striking ‘‘$100,000,000’’ and 

inserting ‘‘$0’’; and 

(2) in subparagraph (B), by striking ‘‘$150,000,000’’ and 

inserting ‘‘$0’’. 
H. R. 3590—168 

Subtitle B—Enhanced Support for the 

Children’s Health Insurance Program 

SEC. 2101. ADDITIONAL FEDERAL FINANCIAL PARTICIPATION FOR 

CHIP. 

(a) IN GENERAL.—Section 2105(b) of the Social Security Act 

(42 U.S.C. 1397ee(b)) is amended by adding at the end the following: 

‘‘Notwithstanding the preceding sentence, during the period that 

begins on October 1, 2013, and ends on September 30, 2019, the 

enhanced FMAP determined for a State for a fiscal year (or for 

any portion of a fiscal year occurring during such period) shall 

be increased by 23 percentage points, but in no case shall exceed 

100 percent. The increase in the enhanced FMAP under the preceding sentence shall not apply with respect to determining the 

payment to a State under subsection (a)(1) for expenditures 

described in subparagraph (D)(iv), paragraphs (8), (9), (11) of subsection (c), or clause (4) of the first sentence of section 1905(b).’’. 

(b) MAINTENANCE OF EFFORT.— 

(1) IN GENERAL.—Section 2105(d) of the Social Security 

Act (42 U.S.C. 1397ee(d)) is amended by adding at the end 

the following: 

‘‘(3) CONTINUATION OF ELIGIBILITY STANDARDS FOR CHILDREN UNTIL OCTOBER 1, 2019.— 

‘‘(A) IN GENERAL.—During the period that begins on 

the date of enactment of the Patient Protection and Affordable Care Act and ends on September 30, 2019, a State 

shall not have in effect eligibility standards, methodologies, 

or procedures under its State child health plan (including 

any waiver under such plan) for children (including children provided medical assistance for which payment is 

made under section 2105(a)(1)(A)) that are more restrictive 

than the eligibility standards, methodologies, or procedures, 

respectively, under such plan (or waiver) as in effect on 

the date of enactment of that Act. The preceding sentence 

shall not be construed as preventing a State during such 

period from— 

‘‘(i) applying eligibility standards, methodologies, 

or procedures for children under the State child health 

plan or under any waiver of the plan that are less 

restrictive than the eligibility standards, methodologies, or procedures, respectively, for children under 

the plan or waiver that are in effect on the date of 

enactment of such Act; or 

‘‘(ii) imposing a limitation described in section 

2112(b)(7) for a fiscal year in order to limit expenditures under the State child health plan to those for 

which Federal financial participation is available under 

this section for the fiscal year. 

‘‘(B) ASSURANCE OF EXCHANGE COVERAGE FOR TARGETED LOW-INCOME CHILDREN UNABLE TO BE PROVIDED

CHILD HEALTH ASSISTANCE AS A RESULT OF FUNDING SHORTFALLS.—In the event that allotments provided under section 

2104 are insufficient to provide coverage to all children 

who are eligible to be targeted low-income children under 

the State child health plan under this title, a State shall 
H. R. 3590—169 

establish procedures to ensure that such children are provided coverage through an Exchange established by the 

State under section 1311 of the Patient Protection and 

Affordable Care Act.’’. 

(2) CONFORMING AMENDMENT TO TITLE XXI MEDICAID

MAINTENANCE OF EFFORT.—Section 2105(d)(1) of the Social 

Security Act (42 U.S.C. 1397ee(d)(1)) is amended by adding 

before the period ‘‘, except as required under section 

1902(e)(14)’’. 

(c) NO ENROLLMENT BONUS PAYMENTS FOR CHILDREN

ENROLLED AFTER FISCAL YEAR 2013.—Section 2105(a)(3)(F)(iii) of 

the Social Security Act (42 U.S.C. 1397ee(a)(3)(F)(iii)) is amended 

by inserting ‘‘or any children enrolled on or after October 1, 2013’’ 

before the period. 

(d) INCOME ELIGIBILITY DETERMINED USING MODIFIED GROSS

INCOME.— 

(1) STATE PLAN REQUIREMENT.—Section 2102(b)(1)(B) of the 

Social Security Act (42 U.S.C. 1397bb(b)(1)(B)) is amended— 

(A) in clause (iii), by striking ‘‘and’’ after the semicolon; 

(B) in clause (iv), by striking the period and inserting 

‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(v) shall, beginning January 1, 2014, use modified 

gross income and household income (as defined in section 36B(d)(2) of the Internal Revenue Code of 1986) 

to determine eligibility for child health assistance 

under the State child health plan or under any waiver 

of such plan and for any other purpose applicable 

under the plan or waiver for which a determination 

of income is required, including with respect to the 

imposition of premiums and cost-sharing, consistent 

with section 1902(e)(14).’’. 

(2) CONFORMING AMENDMENT.—Section 2107(e)(1) of the 

Social Security Act (42 U.S.C. 1397gg(e)(1)) is amended— 

(A) by redesignating subparagraphs (E) through (L) 

as subparagraphs (F) through (M), respectively; and 

(B) by inserting after subparagraph (D), the following: 

‘‘(E) Section 1902(e)(14) (relating to income determined 

using modified gross income and household income).’’. 

(e) APPLICATION OF STREAMLINED ENROLLMENT SYSTEM.—Section 2107(e)(1) of the Social Security Act (42 U.S.C. 1397gg(e)(1)), 

as amended by subsection (d)(2), is amended by adding at the 

end the following: 

‘‘(N) Section 1943(b) (relating to coordination with 

State Exchanges and the State Medicaid agency).’’. 

(f) CHIP ELIGIBILITY FOR CHILDREN INELIGIBLE FOR MEDICAID

AS A RESULT OF ELIMINATION OF DISREGARDS.—Notwithstanding 

any other provision of law, a State shall treat any child who 

is determined to be ineligible for medical assistance under the 

State Medicaid plan or under a waiver of the plan as a result 

of the elimination of the application of an income disregard based 

on expense or type of income, as required under section 1902(e)(14) 

of the Social Security Act (as added by this Act), as a targeted 

low-income child under section 2110(b) (unless the child is excluded 

under paragraph (2) of that section) and shall provide child health 

assistance to the child under the State child health plan (whether 
H. R. 3590—170 

implemented under title XIX or XXI, or both, of the Social Security 

Act). 

SEC. 2102. TECHNICAL CORRECTIONS. 

(a) CHIPRA.—Effective as if included in the enactment of the 

Children’s Health Insurance Program Reauthorization Act of 2009 

(Public Law 111–3) (in this section referred to as ‘‘CHIPRA’’): 

(1) Section 2104(m) of the Social Security Act, as added 

by section 102 of CHIPRA, is amended— 

(A) by redesignating paragraph (7) as paragraph (8); 

and 

(B) by inserting after paragraph (6), the following: 

‘‘(7) ADJUSTMENT OF FISCAL YEAR 2010 ALLOTMENTS TO

ACCOUNT FOR CHANGES IN PROJECTED SPENDING FOR CERTAIN

PREVIOUSLY APPROVED EXPANSION PROGRAMS.—For purposes of 

recalculating the fiscal year 2010 allotment, in the case of 

one of the 50 States or the District of Columbia that has 

an approved State plan amendment effective January 1, 2006, 

to provide child health assistance through the provision of 

benefits under the State plan under title XIX for children 

from birth through age 5 whose family income does not exceed 

200 percent of the poverty line, the Secretary shall increase 

the allotment by an amount that would be equal to the Federal 

share of expenditures that would have been claimed at the 

enhanced FMAP rate rather than the Federal medical assistance percentage matching rate for such population.’’. 

(2) Section 605 of CHIPRA is amended by striking ‘‘legal 

residents’’ and insert ‘‘lawfully residing in the United States’’. 

(3) Subclauses (I) and (II) of paragraph (3)(C)(i) of section 

2105(a) of the Social Security Act (42 U.S.C. 1397ee(a)(3)(ii)), 

as added by section 104 of CHIPRA, are each amended by 

striking ‘‘, respectively’’. 

(4) Section 2105(a)(3)(E)(ii) of the Social Security Act (42 

U.S.C. 1397ee(a)(3)(E)(ii)), as added by section 104 of CHIPRA, 

is amended by striking subclause (IV). 

(5) Section 2105(c)(9)(B) of the Social Security Act (42 

U.S.C. 1397e(c)(9)(B)), as added by section 211(c)(1) of CHIPRA, 

is amended by striking ‘‘section 1903(a)(3)(F)’’ and inserting 

‘‘section 1903(a)(3)(G)’’. 

(6) Section 2109(b)(2)(B) of the Social Security Act (42 

U.S.C. 1397ii(b)(2)(B)), as added by section 602 of CHIPRA, 

is amended by striking ‘‘the child population growth factor 

under section 2104(m)(5)(B)’’ and inserting ‘‘a high-performing 

State under section 2111(b)(3)(B)’’. 

(7) Section 2110(c)(9)(B)(v) of the Social Security Act (42 

U.S.C. 1397jj(c)(9)(B)(v)), as added by section 505(b) of CHIPRA, 

is amended by striking ‘‘school or school system’’ and inserting 

‘‘local educational agency (as defined under section 9101 of 

the Elementary and Secondary Education Act of 1965’’. 

(8) Section 211(a)(1)(B) of CHIPRA is amended— 

(A) by striking ‘‘is amended’’ and all that follows 

through ‘‘adding’’ and inserting ‘‘is amended by adding’’; 

and 

(B) by redesignating the new subparagraph to be added 

by such section to section 1903(a)(3) of the Social Security 

Act as a new subparagraph (H). 
H. R. 3590—171 

(b) ARRA.—Effective as if included in the enactment of section 

5006(a) of division B of the American Recovery and Reinvestment 

Act of 2009 (Public Law 111–5), the second sentence of section 

1916A(a)(1) of the Social Security Act (42 U.S.C. 1396o–1(a)(1)) 

is amended by striking ‘‘or (i)’’ and inserting ‘‘, (i), or (j)’’. 

Subtitle C—Medicaid and CHIP 

Enrollment Simplification 

SEC. 2201. ENROLLMENT SIMPLIFICATION AND COORDINATION WITH 

STATE HEALTH INSURANCE EXCHANGES. 

Title XIX of the Social Security Act (42 U.S.C. 1397aa et seq.) 

is amended by adding at the end the following: 

‘‘SEC. 1943. ENROLLMENT SIMPLIFICATION AND COORDINATION WITH 

STATE HEALTH INSURANCE EXCHANGES. 

‘‘(a) CONDITION FOR PARTICIPATION IN MEDICAID.—As a condition of the State plan under this title and receipt of any Federal 

financial assistance under section 1903(a) for calendar quarters 

beginning after January 1, 2014, a State shall ensure that the 

requirements of subsection (b) is met. 

‘‘(b) ENROLLMENT SIMPLIFICATION AND COORDINATION WITH

STATE HEALTH INSURANCE EXCHANGES AND CHIP.— ‘‘(1) IN GENERAL.—A State shall establish procedures for— 

‘‘(A) enabling individuals, through an Internet website 

that meets the requirements of paragraph (4), to apply 

for medical assistance under the State plan or under a 

waiver of the plan, to be enrolled in the State plan or 

waiver, to renew their enrollment in the plan or waiver, 

and to consent to enrollment or reenrollment in the State 

plan through electronic signature; 

‘‘(B) enrolling, without any further determination by 

the State and through such website, individuals who are 

identified by an Exchange established by the State under 

section 1311 of the Patient Protection and Affordable Care 

Act as being eligible for— 

‘‘(i) medical assistance under the State plan or 

under a waiver of the plan; or 

‘‘(ii) child health assistance under the State child 

health plan under title XXI; 

‘‘(C) ensuring that individuals who apply for but are 

determined to be ineligible for medical assistance under 

the State plan or a waiver or ineligible for child health 

assistance under the State child health plan under title 

XXI, are screened for eligibility for enrollment in qualified 

health plans offered through such an Exchange and, if 

applicable, premium assistance for the purchase of a qualified health plan under section 36B of the Internal Revenue 

Code of 1986 (and, if applicable, advance payment of such 

assistance under section 1412 of the Patient Protection 

and Affordable Care Act), and, if eligible, enrolled in such 

a plan without having to submit an additional or separate 

application, and that such individuals receive information 

regarding reduced cost-sharing for eligible individuals 

under section 1402 of the Patient Protection and Affordable 
H. R. 3590—172 

Care Act, and any other assistance or subsidies available 

for coverage obtained through the Exchange; 

‘‘(D) ensuring that the State agency responsible for 

administering the State plan under this title (in this section 

referred to as the ‘State Medicaid agency’), the State agency 

responsible for administering the State child health plan 

under title XXI (in this section referred to as the ‘State 

CHIP agency’) and an Exchange established by the State 

under section 1311 of the Patient Protection and Affordable 

Care Act utilize a secure electronic interface sufficient to 

allow for a determination of an individual’s eligibility for 

such medical assistance, child health assistance, or premium assistance, and enrollment in the State plan under 

this title, title XXI, or a qualified health plan, as appropriate; 

‘‘(E) coordinating, for individuals who are enrolled in 

the State plan or under a waiver of the plan and who 

are also enrolled in a qualified health plan offered through 

such an Exchange, and for individuals who are enrolled 

in the State child health plan under title XXI and who 

are also enrolled in a qualified health plan, the provision 

of medical assistance or child health assistance to such 

individuals with the coverage provided under the qualified 

health plan in which they are enrolled, including services 

described in section 1905(a)(4)(B) (relating to early and 

periodic screening, diagnostic, and treatment services 

defined in section 1905(r)) and provided in accordance with 

the requirements of section 1902(a)(43); and 

‘‘(F) conducting outreach to and enrolling vulnerable 

and underserved populations eligible for medical assistance 

under this title XIX or for child health assistance under 

title XXI, including children, unaccompanied homeless 

youth, children and youth with special health care needs, 

pregnant women, racial and ethnic minorities, rural populations, victims of abuse or trauma, individuals with mental 

health or substance-related disorders, and individuals with 

HIV/AIDS. 

‘‘(2) AGREEMENTS WITH STATE HEALTH INSURANCE

EXCHANGES.—The State Medicaid agency and the State CHIP 

agency may enter into an agreement with an Exchange established by the State under section 1311 of the Patient Protection 

and Affordable Care Act under which the State Medicaid agency 

or State CHIP agency may determine whether a State resident 

is eligible for premium assistance for the purchase of a qualified 

health plan under section 36B of the Internal Revenue Code 

of 1986 (and, if applicable, advance payment of such assistance 

under section 1412 of the Patient Protection and Affordable 

Care Act), so long as the agreement meets such conditions 

and requirements as the Secretary of the Treasury may prescribe to reduce administrative costs and the likelihood of eligibility errors and disruptions in coverage. 

‘‘(3) STREAMLINED ENROLLMENT SYSTEM.—The State Medicaid agency and State CHIP agency shall participate in and 

comply with the requirements for the system established under 

section 1413 of the Patient Protection and Affordable Care 

Act (relating to streamlined procedures for enrollment through 

an Exchange, Medicaid, and CHIP). 
H. R. 3590—173 

‘‘(4) ENROLLMENT WEBSITE REQUIREMENTS.—The procedures established by State under paragraph (1) shall include 

establishing and having in operation, not later than January 

1, 2014, an Internet website that is linked to any website 

of an Exchange established by the State under section 1311 

of the Patient Protection and Affordable Care Act and to the 

State CHIP agency (if different from the State Medicaid agency) 

and allows an individual who is eligible for medical assistance 

under the State plan or under a waiver of the plan and who 

is eligible to receive premium credit assistance for the purchase 

of a qualified health plan under section 36B of the Internal 

Revenue Code of 1986 to compare the benefits, premiums, 

and cost-sharing applicable to the individual under the State 

plan or waiver with the benefits, premiums, and cost-sharing 

available to the individual under a qualified health plan offered 

through such an Exchange, including, in the case of a child, 

the coverage that would be provided for the child through 

the State plan or waiver with the coverage that would be 

provided to the child through enrollment in family coverage 

under that plan and as supplemental coverage by the State 

under the State plan or waiver. 

‘‘(5) CONTINUED NEED FOR ASSESSMENT FOR HOME AND

COMMUNITY-BASED SERVICES.—Nothing in paragraph (1) shall 

limit or modify the requirement that the State assess an individual for purposes of providing home and community-based 

services under the State plan or under any waiver of such 

plan for individuals described in subsection (a)(10)(A)(ii)(VI).’’. 

SEC. 2202. PERMITTING HOSPITALS TO MAKE PRESUMPTIVE ELIGIBILITY DETERMINATIONS FOR ALL MEDICAID ELIGIBLE 

POPULATIONS. 

(a) IN GENERAL.—Section 1902(a)(47) of the Social Security 

Act (42 U.S.C. 1396a(a)(47)) is amended— 

(1) by striking ‘‘at the option of the State, provide’’ and 

inserting ‘‘provide— 

‘‘(A) at the option of the State,’’; 

(2) by inserting ‘‘and’’ after the semicolon; and 

(3) by adding at the end the following: 

‘‘(B) that any hospital that is a participating provider 

under the State plan may elect to be a qualified entity 

for purposes of determining, on the basis of preliminary 

information, whether any individual is eligible for medical 

assistance under the State plan or under a waiver of the 

plan for purposes of providing the individual with medical 

assistance during a presumptive eligibility period, in the 

same manner, and subject to the same requirements, as 

apply to the State options with respect to populations 

described in section 1920, 1920A, or 1920B (but without 

regard to whether the State has elected to provide for 

a presumptive eligibility period under any such sections), 

subject to such guidance as the Secretary shall establish;’’. 

(b) CONFORMING AMENDMENT.—Section 1903(u)(1)(D)(v) of such 

Act (42 U.S.C. 1396b(u)(1)(D)v)) is amended— 

(1) by striking ‘‘or for’’ and inserting ‘‘for’’; and 

(2) by inserting before the period at the end the following: 

‘‘, or for medical assistance provided to an individual during 

a presumptive eligibility period resulting from a determination 
H. R. 3590—174 

of presumptive eligibility made by a hospital that elects under 

section 1902(a)(47)(B) to be a qualified entity for such purpose’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

take effect on January 1, 2014, and apply to services furnished 

on or after that date. 

Subtitle D—Improvements to Medicaid 

Services 

SEC. 2301. COVERAGE FOR FREESTANDING BIRTH CENTER SERVICES. 

(a) IN GENERAL.—Section 1905 of the Social Security Act (42 

U.S.C. 1396d), is amended— 

(1) in subsection (a)— 

(A) in paragraph (27), by striking ‘‘and’’ at the end; 

(B) by redesignating paragraph (28) as paragraph (29); 

and 

(C) by inserting after paragraph (27) the following 

new paragraph: 

‘‘(28) freestanding birth center services (as defined in subsection (l)(3)(A)) and other ambulatory services that are offered 

by a freestanding birth center (as defined in subsection (l)(3)(B)) 

and that are otherwise included in the plan; and’’; and 

(2) in subsection (l), by adding at the end the following 

new paragraph: 

‘‘(3)(A) The term ‘freestanding birth center services’ means services furnished to an individual at a freestanding birth center (as 

defined in subparagraph (B)) at such center. 

‘‘(B) The term ‘freestanding birth center’ means a health 

facility— 

‘‘(i) that is not a hospital; 

‘‘(ii) where childbirth is planned to occur away from the 

pregnant woman’s residence; 

‘‘(iii) that is licensed or otherwise approved by the State 

to provide prenatal labor and delivery or postpartum care and 

other ambulatory services that are included in the plan; and 

‘‘(iv) that complies with such other requirements relating 

to the health and safety of individuals furnished services by 

the facility as the State shall establish. 

‘‘(C) A State shall provide separate payments to providers 

administering prenatal labor and delivery or postpartum care in 

a freestanding birth center (as defined in subparagraph (B)), such 

as nurse midwives and other providers of services such as birth 

attendants recognized under State law, as determined appropriate 

by the Secretary. For purposes of the preceding sentence, the term 

‘birth attendant’ means an individual who is recognized or registered by the State involved to provide health care at childbirth 

and who provides such care within the scope of practice under 

which the individual is legally authorized to perform such care 

under State law (or the State regulatory mechanism provided by 

State law), regardless of whether the individual is under the supervision of, or associated with, a physician or other health care 

provider. Nothing in this subparagraph shall be construed as 

changing State law requirements applicable to a birth attendant.’’. 

(b) CONFORMING AMENDMENT.—Section 1902(a)(10)(A) of the 

Social Security Act (42 U.S.C. 1396a(a)(10)(A)), is amended in the 
H. R. 3590—175 

matter preceding clause (i) by striking ‘‘and (21)’’ and inserting 

‘‘, (21), and (28)’’. 

(c) EFFECTIVE DATE.— (1) IN GENERAL.—Except as provided in paragraph (2), the 

amendments made by this section shall take effect on the 

date of the enactment of this Act and shall apply to services 

furnished on or after such date. 

(2) EXCEPTION IF STATE LEGISLATION REQUIRED.—In the 

case of a State plan for medical assistance under title XIX 

of the Social Security Act which the Secretary of Health and 

Human Services determines requires State legislation (other 

than legislation appropriating funds) in order for the plan to 

meet the additional requirement imposed by the amendments 

made by this section, the State plan shall not be regarded 

as failing to comply with the requirements of such title solely 

on the basis of its failure to meet this additional requirement 

before the first day of the first calendar quarter beginning 

after the close of the first regular session of the State legislature 

that begins after the date of the enactment of this Act. For 

purposes of the previous sentence, in the case of a State that 

has a 2-year legislative session, each year of such session 

shall be deemed to be a separate regular session of the State 

legislature. 

SEC. 2302. CONCURRENT CARE FOR CHILDREN. 

(a) IN GENERAL.—Section 1905(o)(1) of the Social Security Act 

(42 U.S.C. 1396d(o)(1)) is amended— 

(1) in subparagraph (A), by striking ‘‘subparagraph (B)’’ 

and inserting ‘‘subparagraphs (B) and (C)’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(C) A voluntary election to have payment made for hospice 

care for a child (as defined by the State) shall not constitute 

a waiver of any rights of the child to be provided with, or to 

have payment made under this title for, services that are related 

to the treatment of the child’s condition for which a diagnosis 

of terminal illness has been made.’’. 

(b) APPLICATION TO CHIP.—Section 2110(a)(23) of the Social 

Security Act (42 U.S.C. 1397jj(a)(23)) is amended by inserting 

‘‘(concurrent, in the case of an individual who is a child, with 

care related to the treatment of the child’s condition with respect 

to which a diagnosis of terminal illness has been made’’ after 

‘‘hospice care’’. 

SEC. 2303. STATE ELIGIBILITY OPTION FOR FAMILY PLANNING SERVICES. 

(a) COVERAGE AS OPTIONAL CATEGORICALLY NEEDY GROUP.— (1) IN GENERAL.—Section 1902(a)(10)(A)(ii) of the Social 

Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)), as amended by 

section 2001(e), is amended— 

(A) in subclause (XIX), by striking ‘‘or’’ at the end; 

(B) in subclause (XX), by adding ‘‘or’’ at the end; and 

(C) by adding at the end the following new subclause: 

‘‘(XXI) who are described in subsection (ii) 

(relating to individuals who meet certain income 

standards);’’. 

(2) GROUP DESCRIBED.—Section 1902 of such Act (42 U.S.C. 

1396a), as amended by section 2001(d), is amended by adding 

at the end the following new subsection: 
H. R. 3590—176 

‘‘(ii)(1) Individuals described in this subsection are individuals— 

‘‘(A) whose income does not exceed an income eligibility 

level established by the State that does not exceed the 

highest income eligibility level established under the State 

plan under this title (or under its State child health plan 

under title XXI) for pregnant women; and 

‘‘(B) who are not pregnant. 

‘‘(2) At the option of a State, individuals described in this 

subsection may include individuals who, had individuals 

applied on or before January 1, 2007, would have been made 

eligible pursuant to the standards and processes imposed by 

that State for benefits described in clause (XV) of the matter 

following subparagraph (G) of section subsection (a)(10) pursuant to a waiver granted under section 1115. 

‘‘(3) At the option of a State, for purposes of subsection 

(a)(17)(B), in determining eligibility for services under this subsection, the State may consider only the income of the applicant 

or recipient.’’. 

(3) LIMITATION ON BENEFITS.—Section 1902(a)(10) of the 

Social Security Act (42 U.S.C. 1396a(a)(10)), as amended by 

section 2001(a)(5)(A), is amended in the matter following 

subparagraph (G)— 

(A) by striking ‘‘and (XV)’’ and inserting ‘‘(XV)’’; and 

(B) by inserting ‘‘, and (XVI) the medical assistance 

made available to an individual described in subsection 

(ii) shall be limited to family planning services and supplies 

described in section 1905(a)(4)(C) including medical diagnosis and treatment services that are provided pursuant 

to a family planning service in a family planning setting’’ 

before the semicolon. 

(4) CONFORMING AMENDMENTS.— (A) Section 1905(a) of the Social Security Act (42 U.S.C. 

1396d(a)), as amended by section 2001(e)(2)(A), is amended 

in the matter preceding paragraph (1)— 

(i) in clause (xiv), by striking ‘‘or’’ at the end; 

(ii) in clause (xv), by adding ‘‘or’’ at the end; and 

(iii) by inserting after clause (xv) the following: 

‘‘(xvi) individuals described in section 1902(ii),’’. 

(B) Section 1903(f)(4) of such Act (42 U.S.C. 

1396b(f)(4)), as amended by section 2001(e)(2)(B), is 

amended by inserting ‘‘1902(a)(10)(A)(ii)(XXI),’’ after 

‘‘1902(a)(10)(A)(ii)(XX),’’. 

(b) PRESUMPTIVE ELIGIBILITY.— 

(1) IN GENERAL.—Title XIX of the Social Security Act (42 

U.S.C. 1396 et seq.) is amended by inserting after section 

1920B the following: 

‘‘PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING SERVICES

‘‘SEC. 1920C. (a) STATE OPTION.—State plan approved under 

section 1902 may provide for making medical assistance available 

to an individual described in section 1902(ii) (relating to individuals 

who meet certain income eligibility standard) during a presumptive 

eligibility period. In the case of an individual described in section 

1902(ii), such medical assistance shall be limited to family planning 

services and supplies described in 1905(a)(4)(C) and, at the State’s 

option, medical diagnosis and treatment services that are provided 
H. R. 3590—177 

in conjunction with a family planning service in a family planning 

setting. 

‘‘(b) DEFINITIONS.—For purposes of this section: 

‘‘(1) PRESUMPTIVE ELIGIBILITY PERIOD.—The term ‘presumptive eligibility period’ means, with respect to an individual 

described in subsection (a), the period that— 

‘‘(A) begins with the date on which a qualified entity 

determines, on the basis of preliminary information, that 

the individual is described in section 1902(ii); and 

‘‘(B) ends with (and includes) the earlier of— 

‘‘(i) the day on which a determination is made 

with respect to the eligibility of such individual for 

services under the State plan; or 

‘‘(ii) in the case of such an individual who does 

not file an application by the last day of the month 

following the month during which the entity makes 

the determination referred to in subparagraph (A), 

such last day. 

‘‘(2) QUALIFIED ENTITY.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

term ‘qualified entity’ means any entity that— 

‘‘(i) is eligible for payments under a State plan 

approved under this title; and 

‘‘(ii) is determined by the State agency to be 

capable of making determinations of the type described 

in paragraph (1)(A). 

‘‘(B) RULE OF CONSTRUCTION.—Nothing in this paragraph shall be construed as preventing a State from limiting the classes of entities that may become qualified 

entities in order to prevent fraud and abuse. 

‘‘(c) ADMINISTRATION.— 

‘‘(1) IN GENERAL.—The State agency shall provide qualified 

entities with— 

‘‘(A) such forms as are necessary for an application 

to be made by an individual described in subsection (a) 

for medical assistance under the State plan; and 

‘‘(B) information on how to assist such individuals in 

completing and filing such forms. 

‘‘(2) NOTIFICATION REQUIREMENTS.—A qualified entity that 

determines under subsection (b)(1)(A) that an individual 

described in subsection (a) is presumptively eligible for medical 

assistance under a State plan shall— 

‘‘(A) notify the State agency of the determination within 

5 working days after the date on which determination 

is made; and 

‘‘(B) inform such individual at the time the determination is made that an application for medical assistance 

is required to be made by not later than the last day 

of the month following the month during which the determination is made. 

‘‘(3) APPLICATION FOR MEDICAL ASSISTANCE.—In the case 

of an individual described in subsection (a) who is determined 

by a qualified entity to be presumptively eligible for medical 

assistance under a State plan, the individual shall apply for 

medical assistance by not later than the last day of the month 

following the month during which the determination is made. 
H. R. 3590—178 

‘‘(d) PAYMENT.—Notwithstanding any other provision of law, 

medical assistance that— 

‘‘(1) is furnished to an individual described in subsection 

(a)— 

‘‘(A) during a presumptive eligibility period; and 

‘‘(B) by a entity that is eligible for payments under 

the State plan; and 

‘‘(2) is included in the care and services covered by the 

State plan, 

shall be treated as medical assistance provided by such plan for 

purposes of clause (4) of the first sentence of section 1905(b).’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Section 1902(a)(47) of the Social Security Act (42 

U.S.C. 1396a(a)(47)), as amended by section 2202(a), is 

amended— 

(i) in subparagraph (A), by inserting before the 

semicolon at the end the following: ‘‘and provide for 

making medical assistance available to individuals 

described in subsection (a) of section 1920C during 

a presumptive eligibility period in accordance with 

such section’’; and 

(ii) in subparagraph (B), by striking ‘‘or 1920B’’ 

and inserting ‘‘1920B, or 1920C’’. 

(B) Section 1903(u)(1)(D)(v) of such Act (42 U.S.C. 

1396b(u)(1)(D)(v)), as amended by section 2202(b), is 

amended by inserting ‘‘or for medical assistance provided 

to an individual described in subsection (a) of section 1920C 

during a presumptive eligibility period under such section,’’ 

after ‘‘1920B during a presumptive eligibility period under 

such section,’’. 

(c) CLARIFICATION OF COVERAGE OF FAMILY PLANNING SERVICES

AND SUPPLIES.—Section 1937(b) of the Social Security Act (42 U.S.C. 

1396u–7(b)), as amended by section 2001(c), is amended by adding 

at the end the following: 

‘‘(7) COVERAGE OF FAMILY PLANNING SERVICES AND SUPPLIES.—Notwithstanding the previous provisions of this section, 

a State may not provide for medical assistance through enrollment of an individual with benchmark coverage or benchmarkequivalent coverage under this section unless such coverage 

includes for any individual described in section 1905(a)(4)(C), 

medical assistance for family planning services and supplies 

in accordance with such section.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

take effect on the date of the enactment of this Act and shall 

apply to items and services furnished on or after such date. 

SEC. 2304. CLARIFICATION OF DEFINITION OF MEDICAL ASSISTANCE. 

Section 1905(a) of the Social Security Act (42 U.S.C. 1396d(a)) 

is amended by inserting ‘‘or the care and services themselves, 

or both’’ before ‘‘(if provided in or after’’. 
H. R. 3590—179 

Subtitle E—New Options for States to 

Provide Long-Term Services and Supports 

SEC. 2401. COMMUNITY FIRST CHOICE OPTION. 

Section 1915 of the Social Security Act (42 U.S.C. 1396n) is 

amended by adding at the end the following: 

‘‘(k) STATE PLAN OPTION TO PROVIDE HOME AND COMMUNITY- BASED ATTENDANT SERVICES AND SUPPORTS.— ‘‘(1) IN GENERAL.—Subject to the succeeding provisions of 

this subsection, beginning October 1, 2010, a State may provide 

through a State plan amendment for the provision of medical 

assistance for home and community-based attendant services 

and supports for individuals who are eligible for medical assistance under the State plan whose income does not exceed 150 

percent of the poverty line (as defined in section 2110(c)(5)) 

or, if greater, the income level applicable for an individual 

who has been determined to require an institutional level of 

care to be eligible for nursing facility services under the State 

plan and with respect to whom there has been a determination 

that, but for the provision of such services, the individuals 

would require the level of care provided in a hospital, a nursing 

facility, an intermediate care facility for the mentally retarded, 

or an institution for mental diseases, the cost of which could 

be reimbursed under the State plan, but only if the individual 

chooses to receive such home and community-based attendant 

services and supports, and only if the State meets the following 

requirements: 

‘‘(A) AVAILABILITY.—The State shall make available 

home and community-based attendant services and supports to eligible individuals, as needed, to assist in accomplishing activities of daily living, instrumental activities 

of daily living, and health-related tasks through handson assistance, supervision, or cueing— 

‘‘(i) under a person-centered plan of services and 

supports that is based on an assessment of functional 

need and that is agreed to in writing by the individual 

or, as appropriate, the individual’s representative; 

‘‘(ii) in a home or community setting, which does 

not include a nursing facility, institution for mental 

diseases, or an intermediate care facility for the mentally retarded; 

‘‘(iii) under an agency-provider model or other 

model (as defined in paragraph (6)(C )); and 

‘‘(iv) the furnishing of which— 

‘‘(I) is selected, managed, and dismissed by 

the individual, or, as appropriate, with assistance 

from the individual’s representative; 

‘‘(II) is controlled, to the maximum extent possible, by the individual or where appropriate, the 

individual’s representative, regardless of who may 

act as the employer of record; and 

‘‘(III) provided by an individual who is qualified to provide such services, including family 

members (as defined by the Secretary). 

‘‘(B) INCLUDED SERVICES AND SUPPORTS.—In addition 

to assistance in accomplishing activities of daily living, 
H. R. 3590—180 

instrumental activities of daily living, and health related 

tasks, the home and community-based attendant services 

and supports made available include— 

‘‘(i) the acquisition, maintenance, and enhancement of skills necessary for the individual to accomplish activities of daily living, instrumental activities 

of daily living, and health related tasks; 

‘‘(ii) back-up systems or mechanisms (such as the 

use of beepers or other electronic devices) to ensure 

continuity of services and supports; and 

‘‘(iii) voluntary training on how to select, manage, 

and dismiss attendants. 

‘‘(C) EXCLUDED SERVICES AND SUPPORTS.—Subject to 

subparagraph (D), the home and community-based attendant services and supports made available do not include— 

‘‘(i) room and board costs for the individual; 

‘‘(ii) special education and related services provided 

under the Individuals with Disabilities Education Act 

and vocational rehabilitation services provided under 

the Rehabilitation Act of 1973; 

‘‘(iii) assistive technology devices and assistive 

technology services other than those under (1)(B)(ii); 

‘‘(iv) medical supplies and equipment; or 

‘‘(v) home modifications. 

‘‘(D) PERMISSIBLE SERVICES AND SUPPORTS.—The home 

and community-based attendant services and supports may 

include— 

‘‘(i) expenditures for transition costs such as rent 

and utility deposits, first month’s rent and utilities, 

bedding, basic kitchen supplies, and other necessities 

required for an individual to make the transition from 

a nursing facility, institution for mental diseases, or 

intermediate care facility for the mentally retarded 

to a community-based home setting where the individual resides; and 

‘‘(ii) expenditures relating to a need identified in 

an individual’s person-centered plan of services that 

increase independence or substitute for human assistance, to the extent that expenditures would otherwise 

be made for the human assistance. 

‘‘(2) INCREASED FEDERAL FINANCIAL PARTICIPATION.—For 

purposes of payments to a State under section 1903(a)(1), with 

respect to amounts expended by the State to provide medical 

assistance under the State plan for home and communitybased attendant services and supports to eligible individuals 

in accordance with this subsection during a fiscal year quarter 

occurring during the period described in paragraph (1), the 

Federal medical assistance percentage applicable to the State 

(as determined under section 1905(b)) shall be increased by 

6 percentage points. 

‘‘(3) STATE REQUIREMENTS.—In order for a State plan 

amendment to be approved under this subsection, the State 

shall— 

‘‘(A) develop and implement such amendment in 

collaboration with a Development and Implementation 

Council established by the State that includes a majority 

of members with disabilities, elderly individuals, and their 
H. R. 3590—181 

representatives and consults and collaborates with such 

individuals; 

‘‘(B) provide consumer controlled home and communitybased attendant services and supports to individuals on 

a statewide basis, in a manner that provides such services 

and supports in the most integrated setting appropriate 

to the individual’s needs, and without regard to the individual’s age, type or nature of disability, severity of disability, 

or the form of home and community-based attendant services and supports that the individual requires in order 

to lead an independent life; 

‘‘(C) with respect to expenditures during the first full 

fiscal year in which the State plan amendment is implemented, maintain or exceed the level of State expenditures 

for medical assistance that is provided under section 

1905(a), section 1915, section 1115, or otherwise to individuals with disabilities or elderly individuals attributable 

to the preceding fiscal year; 

‘‘(D) establish and maintain a comprehensive, continuous quality assurance system with respect to communitybased attendant services and supports that— 

‘‘(i) includes standards for agency-based and other 

delivery models with respect to training, appeals for 

denials and reconsideration procedures of an individual 

plan, and other factors as determined by the Secretary; 

‘‘(ii) incorporates feedback from consumers and 

their representatives, disability organizations, providers, families of disabled or elderly individuals, members of the community, and others and maximizes consumer independence and consumer control; 

‘‘(iii) monitors the health and well-being of each 

individual who receives home and community-based 

attendant services and supports, including a process 

for the mandatory reporting, investigation, and resolution of allegations of neglect, abuse, or exploitation 

in connection with the provision of such services and 

supports; and 

‘‘(iv) provides information about the provisions of 

the quality assurance required under clauses (i) 

through (iii) to each individual receiving such services; 

and 

‘‘(E) collect and report information, as determined necessary by the Secretary, for the purposes of approving 

the State plan amendment, providing Federal oversight, 

and conducting an evaluation under paragraph (5)(A), 

including data regarding how the State provides home 

and community-based attendant services and supports and 

other home and community-based services, the cost of such 

services and supports, and how the State provides individuals with disabilities who otherwise qualify for institutional 

care under the State plan or under a waiver the choice 

to instead receive home and community-based services in 

lieu of institutional care. 

‘‘(4) COMPLIANCE WITH CERTAIN LAWS.—A State shall 

ensure that, regardless of whether the State uses an agencyprovider model or other models to provide home and community-based attendant services and supports under a State plan 
H. R. 3590—182 

amendment under this subsection, such services and supports 

are provided in accordance with the requirements of the Fair 

Labor Standards Act of 1938 and applicable Federal and State 

laws regarding— 

‘‘(A) withholding and payment of Federal and State 

income and payroll taxes; 

‘‘(B) the provision of unemployment and workers compensation insurance; 

‘‘(C) maintenance of general liability insurance; and 

‘‘(D) occupational health and safety. 

‘‘(5) EVALUATION, DATA COLLECTION, AND REPORT TO CONGRESS.— 

‘‘(A) EVALUATION.—The Secretary shall conduct an 

evaluation of the provision of home and community-based 

attendant services and supports under this subsection in 

order to determine the effectiveness of the provision of 

such services and supports in allowing the individuals 

receiving such services and supports to lead an independent 

life to the maximum extent possible; the impact on the 

physical and emotional health of the individuals who 

receive such services; and an comparative analysis of the 

costs of services provided under the State plan amendment 

under this subsection and those provided under institutional care in a nursing facility, institution for mental 

diseases, or an intermediate care facility for the mentally 

retarded. 

‘‘(B) DATA COLLECTION.—The State shall provide the 

Secretary with the following information regarding the 

provision of home and community-based attendant services 

and supports under this subsection for each fiscal year 

for which such services and supports are provided: 

‘‘(i) The number of individuals who are estimated 

to receive home and community-based attendant services and supports under this subsection during the 

fiscal year. 

‘‘(ii) The number of individuals that received such 

services and supports during the preceding fiscal year. 

‘‘(iii) The specific number of individuals served by 

type of disability, age, gender, education level, and 

employment status. 

‘‘(iv) Whether the specific individuals have been 

previously served under any other home and community based services program under the State plan or 

under a waiver. 

‘‘(C) REPORTS.—Not later than— 

‘‘(i) December 31, 2013, the Secretary shall submit 

to Congress and make available to the public an 

interim report on the findings of the evaluation under 

subparagraph (A); and 

‘‘(ii) December 31, 2015, the Secretary shall submit 

to Congress and make available to the public a final 

report on the findings of the evaluation under subparagraph (A). 

‘‘(6) DEFINITIONS.—In this subsection: 

‘‘(A) ACTIVITIES OF DAILY LIVING.—The term ‘activities 

of daily living’ includes tasks such as eating, toileting, 

grooming, dressing, bathing, and transferring. 
H. R. 3590—183 

‘‘(B) CONSUMER CONTROLLED.—The term ‘consumer 

controlled’ means a method of selecting and providing services and supports that allow the individual, or where appropriate, the individual’s representative, maximum control 

of the home and community-based attendant services and 

supports, regardless of who acts as the employer of record. 

‘‘(C) DELIVERY MODELS.— 

‘‘(i) AGENCY-PROVIDER MODEL.—The term ‘agencyprovider model’ means, with respect to the provision 

of home and community-based attendant services and 

supports for an individual, subject to paragraph (4), 

a method of providing consumer controlled services 

and supports under which entities contract for the 

provision of such services and supports. 

‘‘(ii) OTHER MODELS.—The term ‘other models’ 

means, subject to paragraph (4), methods, other than 

an agency-provider model, for the provision of consumer controlled services and supports. Such models 

may include the provision of vouchers, direct cash payments, or use of a fiscal agent to assist in obtaining 

services. 

‘‘(D) HEALTH-RELATED TASKS.—The term ‘healthrelated tasks’ means specific tasks related to the needs 

of an individual, which can be delegated or assigned by 

licensed health-care professionals under State law to be 

performed by an attendant. 

‘‘(E) INDIVIDUAL’S REPRESENTATIVE.—The term ‘individual’s representative’ means a parent, family member, 

guardian, advocate, or other authorized representative of 

an individual 

‘‘(F) INSTRUMENTAL ACTIVITIES OF DAILY LIVING.—The 

term ‘instrumental activities of daily living’ includes (but 

is not limited to) meal planning and preparation, managing 

finances, shopping for food, clothing, and other essential 

items, performing essential household chores, communicating by phone or other media, and traveling around 

and participating in the community.’’. 

SEC. 2402. REMOVAL OF BARRIERS TO PROVIDING HOME AND COMMUNITY-BASED SERVICES. 

(a) OVERSIGHT AND ASSESSMENT OF THE ADMINISTRATION OF

HOME AND COMMUNITY-BASED SERVICES.—The Secretary of Health 

and Human Services shall promulgate regulations to ensure that 

all States develop service systems that are designed to— 

(1) allocate resources for services in a manner that is 

responsive to the changing needs and choices of beneficiaries 

receiving non-institutionally-based long-term services and supports (including such services and supports that are provided 

under programs other the State Medicaid program), and that 

provides strategies for beneficiaries receiving such services to 

maximize their independence, including through the use of 

client-employed providers; 

(2) provide the support and coordination needed for a beneficiary in need of such services (and their family caregivers 

or representative, if applicable) to design an individualized, 

self-directed, community-supported life; and 
H. R. 3590—184 

(3) improve coordination among, and the regulation of, 

all providers of such services under federally and State-funded 

programs in order to— 

(A) achieve a more consistent administration of policies 

and procedures across programs in relation to the provision 

of such services; and 

(B) oversee and monitor all service system functions 

to assure— 

(i) coordination of, and effectiveness of, eligibility 

determinations and individual assessments; 

(ii) development and service monitoring of a complaint system, a management system, a system to 

qualify and monitor providers, and systems for rolesetting and individual budget determinations; and 

(iii) an adequate number of qualified direct care 

workers to provide self-directed personal assistance 

services. 

(b) ADDITIONAL STATE OPTIONS.—Section 1915(i) of the Social 

Security Act (42 U.S.C. 1396n(i)) is amended by adding at the 

end the following new paragraphs: 

‘‘(6) STATE OPTION TO PROVIDE HOME AND COMMUNITY-BASED

SERVICES TO INDIVIDUALS ELIGIBLE FOR SERVICES UNDER A

WAIVER.— 

‘‘(A) IN GENERAL.—A State that provides home and 

community-based services in accordance with this subsection to individuals who satisfy the needs-based criteria 

for the receipt of such services established under paragraph 

(1)(A) may, in addition to continuing to provide such services to such individuals, elect to provide home and community-based services in accordance with the requirements 

of this paragraph to individuals who are eligible for home 

and community-based services under a waiver approved 

for the State under subsection (c), (d), or (e) or under 

section 1115 to provide such services, but only for those 

individuals whose income does not exceed 300 percent of 

the supplemental security income benefit rate established 

by section 1611(b)(1). 

‘‘(B) APPLICATION OF SAME REQUIREMENTS FOR INDIVIDUALS SATISFYING NEEDS-BASED CRITERIA.—Subject to 

subparagraph (C), a State shall provide home and community-based services to individuals under this paragraph 

in the same manner and subject to the same requirements 

as apply under the other paragraphs of this subsection 

to the provision of home and community-based services 

to individuals who satisfy the needs-based criteria established under paragraph (1)(A). 

‘‘(C) AUTHORITY TO OFFER DIFFERENT TYPE, AMOUNT, DURATION, OR SCOPE OF HOME AND COMMUNITY-BASED SERV- ICES.—A State may offer home and community-based services to individuals under this paragraph that differ in 

type, amount, duration, or scope from the home and 

community-based services offered for individuals who satisfy the needs-based criteria established under paragraph 

(1)(A), so long as such services are within the scope of 

services described in paragraph (4)(B) of subsection (c) 

for which the Secretary has the authority to approve a 

waiver and do not include room or board. 
H. R. 3590—185 

‘‘(7) STATE OPTION TO OFFER HOME AND COMMUNITY-BASED

SERVICES TO SPECIFIC, TARGETED POPULATIONS.— 

‘‘(A) IN GENERAL.—A State may elect in a State plan 

amendment under this subsection to target the provision 

of home and community-based services under this subsection to specific populations and to differ the type, 

amount, duration, or scope of such services to such specific 

populations. 

‘‘(B) 5-YEAR TERM.— 

‘‘(i) IN GENERAL.—An election by a State under 

this paragraph shall be for a period of 5 years. 

‘‘(ii) PHASE-IN OF SERVICES AND ELIGIBILITY PERMITTED DURING INITIAL 5-YEAR PERIOD.—A State 

making an election under this paragraph may, during 

the first 5-year period for which the election is made, 

phase-in the enrollment of eligible individuals, or the 

provision of services to such individuals, or both, so 

long as all eligible individuals in the State for such 

services are enrolled, and all such services are provided, before the end of the initial 5-year period. 

‘‘(C) RENEWAL.—An election by a State under this paragraph may be renewed for additional 5-year terms if the 

Secretary determines, prior to beginning of each such 

renewal period, that the State has— 

‘‘(i) adhered to the requirements of this subsection 

and paragraph in providing services under such an 

election; and 

‘‘(ii) met the State’s objectives with respect to 

quality improvement and beneficiary outcomes.’’. 

(c) REMOVAL OF LIMITATION ON SCOPE OF SERVICES.—Paragraph (1) of section 1915(i) of the Social Security Act (42 U.S.C. 

1396n(i)), as amended by subsection (a), is amended by striking 

‘‘or such other services requested by the State as the Secretary 

may approve’’. 

(d) OPTIONAL ELIGIBILITY CATEGORY TO PROVIDE FULL MED- ICAID BENEFITS TO INDIVIDUALS RECEIVING HOME AND COMMUNITY- BASED SERVICES UNDER A STATE PLAN AMENDMENT.— (1) IN GENERAL.—Section 1902(a)(10)(A)(ii) of the Social 

Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)), as amended by 

section 2304(a)(1), is amended— 

(A) in subclause (XX), by striking ‘‘or’’ at the end; 

(B) in subclause (XXI), by adding ‘‘or’’ at the end; 

and 

(C) by inserting after subclause (XXI), the following 

new subclause: 

‘‘(XXII) who are eligible for home and community-based services under needs-based criteria 

established under paragraph (1)(A) of section 

1915(i), or who are eligible for home and community-based services under paragraph (6) of such 

section, and who will receive home and communitybased services pursuant to a State plan amendment under such subsection;’’. 

(2) CONFORMING AMENDMENTS.— (A) Section 1903(f)(4) of the Social Security Act (42 

U.S.C. 1396b(f)(4)), as amended by section 2304(a)(4)(B), 

is amended in the matter preceding subparagraph (A), 
H. R. 3590—186 

by inserting ‘‘1902(a)(10)(A)(ii)(XXII),’’ after 

‘‘1902(a)(10)(A)(ii)(XXI),’’. 

(B) Section 1905(a) of the Social Security Act (42 U.S.C. 

1396d(a)), as so amended, is amended in the matter preceding paragraph (1)— 

(i) in clause (xv), by striking ‘‘or’’ at the end; 

(ii) in clause (xvi), by adding ‘‘or’’ at the end; 

and 

(iii) by inserting after clause (xvi) the following 

new clause: 

‘‘(xvii) individuals who are eligible for home and community-based services under needs-based criteria established 

under paragraph (1)(A) of section 1915(i), or who are eligible 

for home and community-based services under paragraph (6) 

of such section, and who will receive home and communitybased services pursuant to a State plan amendment under 

such subsection,’’. 

(e) ELIMINATION OF OPTION TO LIMIT NUMBER OF ELIGIBLE

INDIVIDUALS OR LENGTH OF PERIOD FOR GRANDFATHERED INDIVIDUALS IF ELIGIBILITY CRITERIA IS MODIFIED.—Paragraph (1) of section 1915(i) of such Act (42 U.S.C. 1396n(i)) is amended— 

(1) by striking subparagraph (C) and inserting the following: 

‘‘(C) PROJECTION OF NUMBER OF INDIVIDUALS TO BE

PROVIDED HOME AND COMMUNITY-BASED SERVICES.—The 

State submits to the Secretary, in such form and manner, 

and upon such frequency as the Secretary shall specify, 

the projected number of individuals to be provided home 

and community-based services.’’; and 

(2) in subclause (II) of subparagraph (D)(ii), by striking 

‘‘to be eligible for such services for a period of at least 12 

months beginning on the date the individual first received 

medical assistance for such services’’ and inserting ‘‘to continue 

to be eligible for such services after the effective date of the 

modification and until such time as the individual no longer 

meets the standard for receipt of such services under such 

pre-modified criteria’’. 

(f) ELIMINATION OF OPTION TO WAIVE STATEWIDENESS; ADDITION OF OPTION TO WAIVE COMPARABILITY.—Paragraph (3) of section 1915(i) of such Act (42 U.S.C. 1396n(3)) is amended by striking 

‘‘1902(a)(1) (relating to statewideness)’’ and inserting ‘‘1902(a)(10)(B) 

(relating to comparability)’’. 

(g) EFFECTIVE DATE.—The amendments made by subsections 

(b) through (f) take effect on the first day of the first fiscal year 

quarter that begins after the date of enactment of this Act. 

SEC. 2403. MONEY FOLLOWS THE PERSON REBALANCING DEMONSTRATION. 

(a) EXTENSION OF DEMONSTRATION.— 

(1) IN GENERAL.—Section 6071(h) of the Deficit Reduction 

Act of 2005 (42 U.S.C. 1396a note) is amended— 

(A) in paragraph (1)(E), by striking ‘‘fiscal year 2011’’ 

and inserting ‘‘each of fiscal years 2011 through 2016’’; 

and 

(B) in paragraph (2), by striking ‘‘2011’’ and inserting 

‘‘2016’’. 
H. R. 3590—187 

(2) EVALUATION.—Paragraphs (2) and (3) of section 6071(g) 

of such Act is amended are each amended by striking ‘‘2011’’ 

and inserting ‘‘2016’’. 

(b) REDUCTION OF INSTITUTIONAL RESIDENCY PERIOD.— (1) IN GENERAL.—Section 6071(b)(2) of the Deficit Reduction 

Act of 2005 (42 U.S.C. 1396a note) is amended— 

(A) in subparagraph (A)(i), by striking ‘‘, for a period 

of not less than 6 months or for such longer minimum 

period, not to exceed 2 years, as may be specified by the 

State’’ and inserting ‘‘for a period of not less than 90 

consecutive days’’; and 

(B) by adding at the end the following: 

‘‘Any days that an individual resides in an institution on the 

basis of having been admitted solely for purposes of receiving 

short-term rehabilitative services for a period for which payment for such services is limited under title XVIII shall not 

be taken into account for purposes of determining the 90- 

day period required under subparagraph (A)(i).’’. 

(2) EFFECTIVE DATE.—The amendments made by this subsection take effect 30 days after the date of enactment of 

this Act. 

SEC. 2404. PROTECTION FOR RECIPIENTS OF HOME AND COMMUNITYBASED SERVICES AGAINST SPOUSAL IMPOVERISHMENT. 

During the 5-year period that begins on January 1, 2014, 

section 1924(h)(1)(A) of the Social Security Act (42 U.S.C. 1396r– 

5(h)(1)(A)) shall be applied as though ‘‘is eligible for medical assistance for home and community-based services provided under subsection (c), (d), or (i) of section 1915, under a waiver approved 

under section 1115, or who is eligible for such medical assistance 

by reason of being determined eligible under section 1902(a)(10)(C) 

or by reason of section 1902(f) or otherwise on the basis of a 

reduction of income based on costs incurred for medical or other 

remedial care, or who is eligible for medical assistance for home 

and community-based attendant services and supports under section 

1915(k)’’ were substituted in such section for ‘‘(at the option of 

the State) is described in section 1902(a)(10)(A)(ii)(VI)’’. 

SEC. 2405. FUNDING TO EXPAND STATE AGING AND DISABILITY 

RESOURCE CENTERS. 

Out of any funds in the Treasury not otherwise appropriated, 

there is appropriated to the Secretary of Health and Human Services, acting through the Assistant Secretary for Aging, $10,000,000 

for each of fiscal years 2010 through 2014, to carry out subsections 

(a)(20)(B)(iii) and (b)(8) of section 202 of the Older Americans Act 

of 1965 (42 U.S.C. 3012). 

SEC. 2406. SENSE OF THE SENATE REGARDING LONG-TERM CARE. 

(a) FINDINGS.—The Senate makes the following findings: 

(1) Nearly 2 decades have passed since Congress seriously 

considered long-term care reform. The United States Bipartisan 

Commission on Comprehensive Health Care, also know as the 

‘‘Pepper Commission’’, released its ‘‘Call for Action’’ blueprint 

for health reform in September 1990. In the 20 years since 

those recommendations were made, Congress has never acted 

on the report. 

(2) In 1999, under the United States Supreme Court’s 

decision in Olmstead v. L.C., 527 U.S. 581 (1999), individuals 
H. R. 3590—188 

with disabilities have the right to choose to receive their longterm services and supports in the community, rather than 

in an institutional setting. 

(3) Despite the Pepper Commission and Olmstead decision, 

the long-term care provided to our Nation’s elderly and disabled 

has not improved. In fact, for many, it has gotten far worse. 

(4) In 2007, 69 percent of Medicaid long-term care spending 

for elderly individuals and adults with physical disabilities 

paid for institutional services. Only 6 states spent 50 percent 

or more of their Medicaid long-term care dollars on home and 

community-based services for elderly individuals and adults 

with physical disabilities while 1⁄2 of the States spent less 

than 25 percent. This disparity continues even though, on average, it is estimated that Medicaid dollars can support nearly 

3 elderly individuals and adults with physical disabilities in 

home and community-based services for every individual in 

a nursing home. Although every State has chosen to provide 

certain services under home and community-based waivers, 

these services are unevenly available within and across States, 

and reach a small percentage of eligible individuals. 

(b) SENSE OF THE SENATE.—It is the sense of the Senate that— 

(1) during the 111th session of Congress, Congress should 

address long-term services and supports in a comprehensive 

way that guarantees elderly and disabled individuals the care 

they need; and 

(2) long term services and supports should be made available in the community in addition to in institutions. 

Subtitle F—Medicaid Prescription Drug 

Coverage 

SEC. 2501. PRESCRIPTION DRUG REBATES. 

(a) INCREASE IN MINIMUM REBATE PERCENTAGE FOR SINGLE

SOURCE DRUGS AND INNOVATOR MULTIPLE SOURCE DRUGS.— (1) IN GENERAL.—Section 1927(c)(1)(B) of the Social Security Act (42 U.S.C. 1396r–8(c)(1)(B)) is amended— 

(A) in clause (i)— 

(i) in subclause (IV), by striking ‘‘and’’ at the end; 

(ii) in subclause (V)— 

(I) by inserting ‘‘and before January 1, 2010’’ 

after ‘‘December 31, 1995,’’; and 

(II) by striking the period at the end and 

inserting ‘‘; and’’; and 

(iii) by adding at the end the following new subclause: 

‘‘(VI) except as provided in clause (iii), after 

December 31, 2009, 23.1 percent.’’; and 

(B) by adding at the end the following new clause: 

‘‘(iii) MINIMUM REBATE PERCENTAGE FOR CERTAIN

DRUGS.— 

‘‘(I) IN GENERAL.—In the case of a single source 

drug or an innovator multiple source drug 

described in subclause (II), the minimum rebate 

percentage for rebate periods specified in clause 

(i)(VI) is 17.1 percent. 
H. R. 3590—189 

‘‘(II) DRUG DESCRIBED.—For purposes of subclause (I), a single source drug or an innovator 

multiple source drug described in this subclause 

is any of the following drugs: 

‘‘(aa) A clotting factor for which a separate 

furnishing payment is made under section 

1842(o)(5) and which is included on a list of 

such factors specified and updated regularly 

by the Secretary. 

‘‘(bb) A drug approved by the Food and 

Drug Administration exclusively for pediatric 

indications.’’. 

(2) RECAPTURE OF TOTAL SAVINGS DUE TO INCREASE.—Section 1927(b)(1) of such Act (42 U.S.C. 1396r–8(b)(1)) is amended 

by adding at the end the following new subparagraph: 

‘‘(C) SPECIAL RULE FOR INCREASED MINIMUM REBATE

PERCENTAGE.— 

‘‘(i) IN GENERAL.—In addition to the amounts 

applied as a reduction under subparagraph (B), for 

rebate periods beginning on or after January 1, 2010, 

during a fiscal year, the Secretary shall reduce payments to a State under section 1903(a) in the manner 

specified in clause (ii), in an amount equal to the 

product of— 

‘‘(I) 100 percent minus the Federal medical 

assistance percentage applicable to the rebate 

period for the State; and 

‘‘(II) the amounts received by the State under 

such subparagraph that are attributable (as estimated by the Secretary based on utilization and 

other data) to the increase in the minimum rebate 

percentage effected by the amendments made by 

subsections (a)(1), (b), and (d) of section 2501 of 

the Patient Protection and Affordable Care Act, 

taking into account the additional drugs included 

under the amendments made by subsection (c) of 

section 2501 of such Act. 

The Secretary shall adjust such payment reduction 

for a calendar quarter to the extent the Secretary 

determines, based upon subsequent utilization and 

other data, that the reduction for such quarter was 

greater or less than the amount of payment reduction 

that should have been made. 

‘‘(ii) MANNER OF PAYMENT REDUCTION.—The 

amount of the payment reduction under clause (i) for 

a State for a quarter shall be deemed an overpayment 

to the State under this title to be disallowed against 

the State’s regular quarterly draw for all Medicaid 

spending under section 1903(d)(2). Such a disallowance 

is not subject to a reconsideration under section 

1116(d).’’. 

(b) INCREASE IN REBATE FOR OTHER DRUGS.—Section 

1927(c)(3)(B) of such Act (42 U.S.C. 1396r–8(c)(3)(B)) is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii)— 

(A) by inserting ‘‘and before January 1, 2010,’’ after 

‘‘December 31, 1993,’’; and 
H. R. 3590—190 

(B) by striking the period and inserting ‘‘; and’’; and 

(3) by adding at the end the following new clause: 

‘‘(iii) after December 31, 2009, is 13 percent.’’. 

(c) EXTENSION OF PRESCRIPTION DRUG DISCOUNTS TO

ENROLLEES OF MEDICAID MANAGED CARE ORGANIZATIONS.— 

(1) IN GENERAL.—Section 1903(m)(2)(A) of such Act (42 

U.S.C. 1396b(m)(2)(A)) is amended— 

(A) in clause (xi), by striking ‘‘and’’ at the end; 

(B) in clause (xii), by striking the period at the end 

and inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(xiii) such contract provides that (I) covered outpatient drugs dispensed to individuals eligible for medical assistance who are enrolled with the entity shall 

be subject to the same rebate required by the agreement entered into under section 1927 as the State 

is subject to and that the State shall collect such 

rebates from manufacturers, (II) capitation rates paid 

to the entity shall be based on actual cost experience 

related to rebates and subject to the Federal regulations requiring actuarially sound rates, and (III) the 

entity shall report to the State, on such timely and 

periodic basis as specified by the Secretary in order 

to include in the information submitted by the State 

to a manufacturer and the Secretary under section 

1927(b)(2)(A), information on the total number of units 

of each dosage form and strength and package size 

by National Drug Code of each covered outpatient drug 

dispensed to individuals eligible for medical assistance 

who are enrolled with the entity and for which the 

entity is responsible for coverage of such drug under 

this subsection (other than covered outpatient drugs 

that under subsection (j)(1) of section 1927 are not 

subject to the requirements of that section) and such 

other data as the Secretary determines necessary to 

carry out this subsection.’’. 

(2) CONFORMING AMENDMENTS.—Section 1927 (42 U.S.C. 

1396r–8) is amended— 

(A) in subsection (b)— 

(i) in paragraph (1)(A), in the first sentence, by 

inserting ‘‘, including such drugs dispensed to individuals enrolled with a medicaid managed care organization if the organization is responsible for coverage of 

such drugs’’ before the period; and 

(ii) in paragraph (2)(A), by inserting ‘‘including 

such information reported by each medicaid managed 

care organization,’’ after ‘‘for which payment was made 

under the plan during the period,’’; and 

(B) in subsection (j), by striking paragraph (1) and 

inserting the following: 

‘‘(1) Covered outpatient drugs are not subject to the requirements of this section if such drugs are— 

‘‘(A) dispensed by health maintenance organizations, 

including Medicaid managed care organizations that contract under section 1903(m); and 

‘‘(B) subject to discounts under section 340B of the 

Public Health Service Act.’’. 
H. R. 3590—191 

(d) ADDITIONAL REBATE FOR NEW FORMULATIONS OF EXISTING

DRUGS.— 

(1) IN GENERAL.—Section 1927(c)(2) of the Social Security 

Act (42 U.S.C. 1396r–8(c)(2)) is amended by adding at the 

end the following new subparagraph: 

‘‘(C) TREATMENT OF NEW FORMULATIONS.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), in the case of a drug that is a new formulation, 

such as an extended-release formulation, of a single 

source drug or an innovator multiple source drug, the 

rebate obligation with respect to the drug under this 

section shall be the amount computed under this section for the new formulation of the drug or, if greater, 

the product of— 

‘‘(I) the average manufacturer price for each 

dosage form and strength of the new formulation 

of the single source drug or innovator multiple 

source drug; 

‘‘(II) the highest additional rebate (calculated 

as a percentage of average manufacturer price) 

under this section for any strength of the original 

single source drug or innovator multiple source 

drug; and 

‘‘(III) the total number of units of each dosage 

form and strength of the new formulation paid 

for under the State plan in the rebate period (as 

reported by the State). 

‘‘(ii) NO APPLICATION TO NEW FORMULATIONS OF

ORPHAN DRUGS.—Clause (i) shall not apply to a new 

formulation of a covered outpatient drug that is or 

has been designated under section 526 of the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 360bb) for 

a rare disease or condition, without regard to whether 

the period of market exclusivity for the drug under 

section 527 of such Act has expired or the specific 

indication for use of the drug.’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply to drugs that are paid for by a State after 

December 31, 2009. 

(e) MAXIMUM REBATE AMOUNT.—Section 1927(c)(2) of such Act 

(42 U.S.C. 1396r–8(c)(2)), as amended by subsection (d), is amended 

by adding at the end the following new subparagraph: 

‘‘(D) MAXIMUM REBATE AMOUNT.—In no case shall the 

sum of the amounts applied under paragraph (1)(A)(ii) 

and this paragraph with respect to each dosage form and 

strength of a single source drug or an innovator multiple 

source drug for a rebate period beginning after December 

31, 2009, exceed 100 percent of the average manufacturer 

price of the drug.’’. 

(f) CONFORMING AMENDMENTS.— 

(1) IN GENERAL.—Section 340B of the Public Health Service 

Act (42 U.S.C. 256b) is amended— 

(A) in subsection (a)(2)(B)(i), by striking ‘‘1927(c)(4)’’ 

and inserting ‘‘1927(c)(3)’’; and 

(B) by striking subsection (c); and 

(C) redesignating subsection (d) as subsection (c). 
H. R. 3590—192 

(2) EFFECTIVE DATE.—The amendments made by this subsection take effect on January 1, 2010. 

SEC. 2502. ELIMINATION OF EXCLUSION OF COVERAGE OF CERTAIN 

DRUGS. 

(a) IN GENERAL.—Section 1927(d) of the Social Security Act 

(42 U.S.C. 1397r–8(d)) is amended— 

(1) in paragraph (2)— 

(A) by striking subparagraphs (E), (I), and (J), respectively; and 

(B) by redesignating subparagraphs (F), (G), (H), and 

(K) as subparagraphs (E), (F), (G), and (H), respectively; 

and 

(2) by adding at the end the following new paragraph: 

‘‘(7) NON-EXCLUDABLE DRUGS.—The following drugs or 

classes of drugs, or their medical uses, shall not be excluded 

from coverage: 

‘‘(A) Agents when used to promote smoking cessation, 

including agents approved by the Food and Drug Administration under the over-the-counter monograph process for 

purposes of promoting, and when used to promote, tobacco 

cessation. 

‘‘(B) Barbiturates. 

‘‘(C) Benzodiazepines.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to services furnished on or after January 1, 2014. 

SEC. 2503. PROVIDING ADEQUATE PHARMACY REIMBURSEMENT. 

(a) PHARMACY REIMBURSEMENT LIMITS.— 

(1) IN GENERAL.—Section 1927(e) of the Social Security 

Act (42 U.S.C. 1396r–8(e)) is amended— 

(A) in paragraph (4), by striking ‘‘(or, effective January 

1, 2007, two or more)’’; and 

(B) by striking paragraph (5) and inserting the following: 

‘‘(5) USE OF AMP IN UPPER PAYMENT LIMITS.—The Secretary 

shall calculate the Federal upper reimbursement limit established under paragraph (4) as no less than 175 percent of 

the weighted average (determined on the basis of utilization) 

of the most recently reported monthly average manufacturer 

prices for pharmaceutically and therapeutically equivalent multiple source drug products that are available for purchase by 

retail community pharmacies on a nationwide basis. The Secretary shall implement a smoothing process for average manufacturer prices. Such process shall be similar to the smoothing 

process used in determining the average sales price of a drug 

or biological under section 1847A.’’. 

(2) DEFINITION OF AMP.—Section 1927(k)(1) of such Act 

(42 U.S.C. 1396r–8(k)(1)) is amended— 

(A) in subparagraph (A), by striking ‘‘by’’ and all that 

follows through the period and inserting ‘‘by— 

‘‘(i) wholesalers for drugs distributed to retail 

community pharmacies; and 

‘‘(ii) retail community pharmacies that purchase 

drugs directly from the manufacturer.’’; and 

(B) by striking subparagraph (B) and inserting the 

following: 
H. R. 3590—193 

‘‘(B) EXCLUSION OF CUSTOMARY PROMPT PAY DISCOUNTS

AND OTHER PAYMENTS.— 

‘‘(i) IN GENERAL.—The average manufacturer price 

for a covered outpatient drug shall exclude— 

‘‘(I) customary prompt pay discounts extended 

to wholesalers; 

‘‘(II) bona fide service fees paid by manufacturers to wholesalers or retail community pharmacies, 

including (but not limited to) distribution service 

fees, inventory management fees, product stocking 

allowances, and fees associated with administrative services agreements and patient care programs (such as medication compliance programs 

and patient education programs); 

‘‘(III) reimbursement by manufacturers for 

recalled, damaged, expired, or otherwise unsalable 

returned goods, including (but not limited to) 

reimbursement for the cost of the goods and any 

reimbursement of costs associated with return 

goods handling and processing, reverse logistics, 

and drug destruction; and 

‘‘(IV) payments received from, and rebates or 

discounts provided to, pharmacy benefit managers, 

managed care organizations, health maintenance 

organizations, insurers, hospitals, clinics, mail 

order pharmacies, long term care providers, manufacturers, or any other entity that does not conduct 

business as a wholesaler or a retail community 

pharmacy. 

‘‘(ii) INCLUSION OF OTHER DISCOUNTS AND PAY- MENTS.—Notwithstanding clause (i), any other discounts, rebates, payments, or other financial transactions that are received by, paid by, or passed through 

to, retail community pharmacies shall be included in 

the average manufacturer price for a covered outpatient drug.’’; and 

(C) in subparagraph (C), by striking ‘‘the retail pharmacy class of trade’’ and inserting ‘‘retail community pharmacies’’. 

(3) DEFINITION OF MULTIPLE SOURCE DRUG.—Section 

1927(k)(7) of such Act (42 U.S.C. 1396r–8(k)(7)) is amended— 

(A) in subparagraph (A)(i)(III), by striking ‘‘the State’’ 

and inserting ‘‘the United States’’; and 

(B) in subparagraph (C)— 

(i) in clause (i), by inserting ‘‘and’’ after the semicolon; 

(ii) in clause (ii), by striking ‘‘; and’’ and inserting 

a period; and 

(iii) by striking clause (iii). 

(4) DEFINITIONS OF RETAIL COMMUNITY PHARMACY; WHOLE- SALER.—Section 1927(k) of such Act (42 U.S.C. 1396r–8(k)) 

is amended by adding at the end the following new paragraphs: 

‘‘(10) RETAIL COMMUNITY PHARMACY.—The term ‘retail 

community pharmacy’ means an independent pharmacy, a 

chain pharmacy, a supermarket pharmacy, or a mass merchandiser pharmacy that is licensed as a pharmacy by the State 

and that dispenses medications to the general public at retail 
H. R. 3590—194 

prices. Such term does not include a pharmacy that dispenses 

prescription medications to patients primarily through the mail, 

nursing home pharmacies, long-term care facility pharmacies, 

hospital pharmacies, clinics, charitable or not-for-profit pharmacies, government pharmacies, or pharmacy benefit managers. 

‘‘(11) WHOLESALER.—The term ‘wholesaler’ means a drug 

wholesaler that is engaged in wholesale distribution of prescription drugs to retail community pharmacies, including (but not 

limited to) manufacturers, repackers, distributors, own-label 

distributors, private-label distributors, jobbers, brokers, warehouses (including manufacturer’s and distributor’s warehouses, 

chain drug warehouses, and wholesale drug warehouses) independent wholesale drug traders, and retail community pharmacies that conduct wholesale distributions.’’. 

(b) DISCLOSURE OF PRICE INFORMATION TO THE PUBLIC.—Section 1927(b)(3) of such Act (42 U.S.C. 1396r–8(b)(3)) is amended— 

(1) in subparagraph (A)— 

(A) in the first sentence, by inserting after clause (iii) 

the following: 

‘‘(iv) not later than 30 days after the last day 

of each month of a rebate period under the agreement, 

on the manufacturer’s total number of units that are 

used to calculate the monthly average manufacturer 

price for each covered outpatient drug;’’; and 

(B) in the second sentence, by inserting ‘‘(relating to 

the weighted average of the most recently reported monthly 

average manufacturer prices)’’ after ‘‘(D)(v)’’; and 

(2) in subparagraph (D)(v), by striking ‘‘average manufacturer prices’’ and inserting ‘‘the weighted average of the most 

recently reported monthly average manufacturer prices and 

the average retail survey price determined for each multiple 

source drug in accordance with subsection (f)’’. 

(c) CLARIFICATION OF APPLICATION OF SURVEY OF RETAIL

PRICES.—Section 1927(f)(1) of such Act (42 U.S.C. 1396r–8(b)(1)) 

is amended— 

(1) in subparagraph (A)(i), by inserting ‘‘with respect to 

a retail community pharmacy,’’ before ‘‘the determination’’; and 

(2) in subparagraph (C)(ii), by striking ‘‘retail pharmacies’’ 

and inserting ‘‘retail community pharmacies’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on the first day of the first calendar year quarter 

that begins at least 180 days after the date of enactment of this 

Act, without regard to whether or not final regulations to carry 

out such amendments have been promulgated by such date. 

Subtitle G—Medicaid Disproportionate 

Share Hospital (DSH) Payments 

SEC. 2551. DISPROPORTIONATE SHARE HOSPITAL PAYMENTS. 

(a) IN GENERAL.—Section 1923(f) of the Social Security Act 

(42 U.S.C. 1396r–4(f)) is amended— 

(1) in paragraph (1), by striking ‘‘and (3)’’ and inserting 

‘‘, (3), and (7)’’; 

(2) in paragraph (3)(A), by striking ‘‘paragraph (6)’’ and 

inserting ‘‘paragraphs (6) and (7)’’; 
H. R. 3590—195 

(3) by redesignating paragraph (7) as paragraph (8); and 

(4) by inserting after paragraph (6) the following new paragraph: 

‘‘(7) REDUCTION OF STATE DSH ALLOTMENTS ONCE REDUCTION IN UNINSURED THRESHOLD REACHED.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (E), the 

DSH allotment for a State for fiscal years beginning with 

the fiscal year described in subparagraph (C) (with respect 

to the State), is equal to— 

‘‘(i) in the case of the first fiscal year described 

in subparagraph (C) with respect to a State, the DSH 

allotment that would be determined under this subsection for the State for the fiscal year without application of this paragraph (but after the application of 

subparagraph (D)), reduced by the applicable percentage determined for the State for the fiscal year under 

subparagraph (B)(i); and 

‘‘(ii) in the case of any subsequent fiscal year with 

respect to the State, the DSH allotment determined 

under this paragraph for the State for the preceding 

fiscal year, reduced by the applicable percentage determined for the State for the fiscal year under subparagraph (B)(ii). 

‘‘(B) APPLICABLE PERCENTAGE.—For purposes of 

subparagraph (A), the applicable percentage for a State 

for a fiscal year is the following: 

‘‘(i) UNINSURED REDUCTION THRESHOLD FISCAL

YEAR.—In the case of the first fiscal year described 

in subparagraph (C) with respect to the State— 

‘‘(I) if the State is a low DSH State described 

in paragraph (5)(B), the applicable percentage is 

equal to 25 percent; and 

‘‘(II) if the State is any other State, the 

applicable percentage is 50 percent. 

‘‘(ii) SUBSEQUENT FISCAL YEARS IN WHICH THE

PERCENTAGE OF UNINSURED DECREASES.—In the case 

of any fiscal year after the first fiscal year described 

in subparagraph (C) with respect to a State, if the 

Secretary determines on the basis of the most recent 

American Community Survey of the Bureau of the 

Census, that the percentage of uncovered individuals 

residing in the State is less than the percentage of 

such individuals determined for the State for the preceding fiscal year— 

‘‘(I) if the State is a low DSH State described 

in paragraph (5)(B), the applicable percentage is 

equal to the product of the percentage reduction 

in uncovered individuals for the fiscal year from 

the preceding fiscal year and 25 percent; and 

‘‘(II) if the State is any other State, the 

applicable percentage is equal to the product of 

the percentage reduction in uncovered individuals 

for the fiscal year from the preceding fiscal year 

and 50 percent. 

‘‘(C) FISCAL YEAR DESCRIBED.—For purposes of 

subparagraph (A), the fiscal year described in this subparagraph with respect to a State is the first fiscal year that 
H. R. 3590—196 

occurs after fiscal year 2012 for which the Secretary determines, on the basis of the most recent American Community Survey of the Bureau of the Census, that the percentage of uncovered individuals residing in the State is at 

least 45 percent less than the percentage of such individuals determined for the State for fiscal year 2009. 

‘‘(D) EXCLUSION OF PORTIONS DIVERTED FOR COVERAGE

EXPANSIONS.—For purposes of applying the applicable 

percentage reduction under subparagraph (A) to the DSH 

allotment for a State for a fiscal year, the DSH allotment 

for a State that would be determined under this subsection 

for the State for the fiscal year without the application 

of this paragraph (and prior to any such reduction) shall 

not include any portion of the allotment for which the 

Secretary has approved the State’s diversion to the costs 

of providing medical assistance or other health benefits 

coverage under a waiver that is in effect on July 2009. 

‘‘(E) MINIMUM ALLOTMENT.—In no event shall the DSH 

allotment determined for a State in accordance with this 

paragraph for fiscal year 2013 or any succeeding fiscal 

year be less than the amount equal to 35 percent of the 

DSH allotment determined for the State for fiscal year 

2012 under this subsection (and after the application of 

this paragraph, if applicable), increased by the percentage 

change in the consumer price index for all urban consumers 

(all items, U.S. city average) for each previous fiscal year 

occurring before the fiscal year. 

‘‘(F) UNCOVERED INDIVIDUALS.—In this paragraph, the 

term ‘uncovered individuals’ means individuals with no 

health insurance coverage at any time during a year (as 

determined by the Secretary based on the most recent 

data available).’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) take effect on October 1, 2011. 

Subtitle H—Improved Coordination for 

Dual Eligible Beneficiaries 

SEC. 2601. 5-YEAR PERIOD FOR DEMONSTRATION PROJECTS. 

(a) IN GENERAL.—Section 1915(h) of the Social Security Act 

(42 U.S.C. 1396n(h)) is amended— 

(1) by inserting ‘‘(1)’’ after ‘‘(h)’’; 

(2) by inserting ‘‘, or a waiver described in paragraph 

(2)’’ after ‘‘(e)’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(2)(A) Notwithstanding subsections (c)(3) and (d) (3), any 

waiver under subsection (b), (c), or (d), or a waiver under section 

1115, that provides medical assistance for dual eligible individuals 

(including any such waivers under which non dual eligible individuals may be enrolled in addition to dual eligible individuals) may 

be conducted for a period of 5 years and, upon the request of 

the State, may be extended for additional 5-year periods unless 

the Secretary determines that for the previous waiver period the 

conditions for the waiver have not been met or it would no longer 

be cost-effective and efficient, or consistent with the purposes of 

this title, to extend the waiver. 
H. R. 3590—197 

‘‘(B) In this paragraph, the term ‘dual eligible individual’ means 

an individual who is entitled to, or enrolled for, benefits under 

part A of title XVIII, or enrolled for benefits under part B of 

title XVIII, and is eligible for medical assistance under the State 

plan under this title or under a waiver of such plan.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Section 1915 of such Act (42 U.S.C. 1396n) is amended— 

(A) in subsection (b), by adding at the end the following 

new sentence: ‘‘Subsection (h)(2) shall apply to a waiver 

under this subsection.’’; 

(B) in subsection (c)(3), in the second sentence, by 

inserting ‘‘(other than a waiver described in subsection 

(h)(2))’’ after ‘‘A waiver under this subsection’’; 

(C) in subsection (d)(3), in the second sentence, by 

inserting ‘‘(other than a waiver described in subsection 

(h)(2))’’ after ‘‘A waiver under this subsection’’. 

(2) Section 1115 of such Act (42 U.S.C. 1315) is amended— 

(A) in subsection (e)(2), by inserting ‘‘(5 years, in the 

case of a waiver described in section 1915(h)(2))’’ after 

‘‘3 years’’; and 

(B) in subsection (f)(6), by inserting ‘‘(5 years, in the 

case of a waiver described in section 1915(h)(2))’’ after 

‘‘3 years’’. 

SEC. 2602. PROVIDING FEDERAL COVERAGE AND PAYMENT COORDINATION FOR DUAL ELIGIBLE BENEFICIARIES. 

(a) ESTABLISHMENT OF FEDERAL COORDINATED HEALTH CARE

OFFICE.— 

(1) IN GENERAL.—Not later than March 1, 2010, the Secretary of Health and Human Services (in this section referred 

to as the ‘‘Secretary’’) shall establish a Federal Coordinated 

Health Care Office. 

(2) ESTABLISHMENT AND REPORTING TO CMS ADMINIS- TRATOR.—The Federal Coordinated Health Care Office— 

(A) shall be established within the Centers for Medicare & Medicaid Services; and 

(B) have as the Office a Director who shall be appointed 

by, and be in direct line of authority to, the Administrator 

of the Centers for Medicare & Medicaid Services. 

(b) PURPOSE.—The purpose of the Federal Coordinated Health 

Care Office is to bring together officers and employees of the Medicare and Medicaid programs at the Centers for Medicare & Medicaid 

Services in order to— 

(1) more effectively integrate benefits under the Medicare 

program under title XVIII of the Social Security Act and the 

Medicaid program under title XIX of such Act; and 

(2) improve the coordination between the Federal Government and States for individuals eligible for benefits under 

both such programs in order to ensure that such individuals 

get full access to the items and services to which they are 

entitled under titles XVIII and XIX of the Social Security 

Act. 

(c) GOALS.—The goals of the Federal Coordinated Health Care 

Office are as follows: 

(1) Providing dual eligible individuals full access to the 

benefits to which such individuals are entitled under the Medicare and Medicaid programs. 
H. R. 3590—198 

(2) Simplifying the processes for dual eligible individuals 

to access the items and services they are entitled to under 

the Medicare and Medicaid programs. 

(3) Improving the quality of health care and long-term 

services for dual eligible individuals. 

(4) Increasing dual eligible individuals’ understanding of 

and satisfaction with coverage under the Medicare and Medicaid programs. 

(5) Eliminating regulatory conflicts between rules under 

the Medicare and Medicaid programs. 

(6) Improving care continuity and ensuring safe and effective care transitions for dual eligible individuals. 

(7) Eliminating cost-shifting between the Medicare and 

Medicaid program and among related health care providers. 

(8) Improving the quality of performance of providers of 

services and suppliers under the Medicare and Medicaid programs. 

(d) SPECIFIC RESPONSIBILITIES.—The specific responsibilities of 

the Federal Coordinated Health Care Office are as follows: 

(1) Providing States, specialized MA plans for special needs 

individuals (as defined in section 1859(b)(6) of the Social Security Act (42 U.S.C. 1395w–28(b)(6))), physicians and other relevant entities or individuals with the education and tools necessary for developing programs that align benefits under the 

Medicare and Medicaid programs for dual eligible individuals. 

(2) Supporting State efforts to coordinate and align acute 

care and long-term care services for dual eligible individuals 

with other items and services furnished under the Medicare 

program. 

(3) Providing support for coordination of contracting and 

oversight by States and the Centers for Medicare & Medicaid 

Services with respect to the integration of the Medicare and 

Medicaid programs in a manner that is supportive of the goals 

described in paragraph (3). 

(4) To consult and coordinate with the Medicare Payment 

Advisory Commission established under section 1805 of the 

Social Security Act (42 U.S.C. 1395b–6) and the Medicaid and 

CHIP Payment and Access Commission established under section 1900 of such Act (42 U.S.C. 1396) with respect to policies 

relating to the enrollment in, and provision of, benefits to 

dual eligible individuals under the Medicare program under 

title XVIII of the Social Security Act and the Medicaid program 

under title XIX of such Act. 

(5) To study the provision of drug coverage for new fullbenefit dual eligible individuals (as defined in section 1935(c)(6) 

of the Social Security Act (42 U.S.C. 1396u–5(c)(6)), as well 

as to monitor and report annual total expenditures, health 

outcomes, and access to benefits for all dual eligible individuals. 

(e) REPORT.—The Secretary shall, as part of the budget transmitted under section 1105(a) of title 31, United States Code, submit 

to Congress an annual report containing recommendations for legislation that would improve care coordination and benefits for dual 

eligible individuals. 

(f) DUAL ELIGIBLE DEFINED.—In this section, the term ‘‘dual 

eligible individual’’ means an individual who is entitled to, or 

enrolled for, benefits under part A of title XVIII of the Social 

Security Act, or enrolled for benefits under part B of title XVIII 
H. R. 3590—199 

of such Act, and is eligible for medical assistance under a State 

plan under title XIX of such Act or under a waiver of such plan. 

Subtitle I—Improving the Quality of 

Medicaid for Patients and Providers 

SEC. 2701. ADULT HEALTH QUALITY MEASURES. 

Title XI of the Social Security Act (42 U.S.C. 1301 et seq.), 

as amended by section 401 of the Children’s Health Insurance 

Program Reauthorization Act of 2009 (Public Law 111–3), is 

amended by inserting after section 1139A the following new section: 

‘‘SEC. 1139B. ADULT HEALTH QUALITY MEASURES. 

‘‘(a) DEVELOPMENT OF CORE SET OF HEALTH CARE QUALITY

MEASURES FOR ADULTS ELIGIBLE FOR BENEFITS UNDER MEDICAID.— The Secretary shall identify and publish a recommended core set 

of adult health quality measures for Medicaid eligible adults in 

the same manner as the Secretary identifies and publishes a core 

set of child health quality measures under section 1139A, including 

with respect to identifying and publishing existing adult health 

quality measures that are in use under public and privately sponsored health care coverage arrangements, or that are part of 

reporting systems that measure both the presence and duration 

of health insurance coverage over time, that may be applicable 

to Medicaid eligible adults. 

‘‘(b) DEADLINES.— ‘‘(1) RECOMMENDED MEASURES.—Not later than January 

1, 2011, the Secretary shall identify and publish for comment 

a recommended core set of adult health quality measures for 

Medicaid eligible adults. 

‘‘(2) DISSEMINATION.—Not later than January 1, 2012, the 

Secretary shall publish an initial core set of adult health quality 

measures that are applicable to Medicaid eligible adults. 

‘‘(3) STANDARDIZED REPORTING.—Not later than January 

1, 2013, the Secretary, in consultation with States, shall develop 

a standardized format for reporting information based on the 

initial core set of adult health quality measures and create 

procedures to encourage States to use such measures to voluntarily report information regarding the quality of health care 

for Medicaid eligible adults. 

‘‘(4) REPORTS TO CONGRESS.—Not later than January 1, 

2014, and every 3 years thereafter, the Secretary shall include 

in the report to Congress required under section 1139A(a)(6) 

information similar to the information required under that 

section with respect to the measures established under this 

section. 

‘‘(5) ESTABLISHMENT OF MEDICAID QUALITY MEASUREMENT

PROGRAM.— 

‘‘(A) IN GENERAL.—Not later than 12 months after the 

release of the recommended core set of adult health quality 

measures under paragraph (1)), the Secretary shall establish a Medicaid Quality Measurement Program in the same 

manner as the Secretary establishes the pediatric quality 

measures program under section 1139A(b). The aggregate 

amount awarded by the Secretary for grants and contracts 

for the development, testing, and validation of emerging 
H. R. 3590—200 

and innovative evidence-based measures under such program shall equal the aggregate amount awarded by the 

Secretary for grants under section 1139A(b)(4)(A) 

‘‘(B) REVISING, STRENGTHENING, AND IMPROVING INITIAL

CORE MEASURES.—Beginning not later than 24 months after 

the establishment of the Medicaid Quality Measurement 

Program, and annually thereafter, the Secretary shall publish recommended changes to the initial core set of adult 

health quality measures that shall reflect the results of 

the testing, validation, and consensus process for the 

development of adult health quality measures. 

‘‘(c) CONSTRUCTION.—Nothing in this section shall be construed 

as supporting the restriction of coverage, under title XIX or XXI 

or otherwise, to only those services that are evidence-based, or 

in anyway limiting available services. 

‘‘(d) ANNUAL STATE REPORTS REGARDING STATE-SPECIFIC

QUALITY OF CARE MEASURES APPLIED UNDER MEDICAID.— 

‘‘(1) ANNUAL STATE REPORTS.—Each State with a State 

plan or waiver approved under title XIX shall annually report 

(separately or as part of the annual report required under 

section 1139A(c)), to the Secretary on the— 

‘‘(A) State-specific adult health quality measures 

applied by the State under the such plan, including measures described in subsection (a)(5); and 

‘‘(B) State-specific information on the quality of health 

care furnished to Medicaid eligible adults under such plan, 

including information collected through external quality 

reviews of managed care organizations under section 1932 

and benchmark plans under section 1937. 

‘‘(2) PUBLICATION.—Not later than September 30, 2014, 

and annually thereafter, the Secretary shall collect, analyze, 

and make publicly available the information reported by States 

under paragraph (1). 

‘‘(e) APPROPRIATION.—Out of any funds in the Treasury not 

otherwise appropriated, there is appropriated for each of fiscal 

years 2010 through 2014, $60,000,000 for the purpose of carrying 

out this section. Funds appropriated under this subsection shall 

remain available until expended.’’. 

SEC. 2702. PAYMENT ADJUSTMENT FOR HEALTH CARE-ACQUIRED 

CONDITIONS. 

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

(in this subsection referred to as the ‘‘Secretary’’) shall identify 

current State practices that prohibit payment for health careacquired conditions and shall incorporate the practices identified, 

or elements of such practices, which the Secretary determines 

appropriate for application to the Medicaid program in regulations. 

Such regulations shall be effective as of July 1, 2011, and shall 

prohibit payments to States under section 1903 of the Social Security Act for any amounts expended for providing medical assistance 

for health care-acquired conditions specified in the regulations. 

The regulations shall ensure that the prohibition on payment for 

health care-acquired conditions shall not result in a loss of access 

to care or services for Medicaid beneficiaries. 

(b) HEALTH CARE-ACQUIRED CONDITION.—In this section. the 

term ‘‘health care-acquired condition’’ means a medical condition 

for which an individual was diagnosed that could be identified 
H. R. 3590—201 

by a secondary diagnostic code described in section 1886(d)(4)(D)(iv) 

of the Social Security Act (42 U.S.C. 1395ww(d)(4)(D)(iv)). 

(c) MEDICARE PROVISIONS.—In carrying out this section, the 

Secretary shall apply to State plans (or waivers) under title XIX 

of the Social Security Act the regulations promulgated pursuant 

to section 1886(d)(4)(D) of such Act (42 U.S.C. 1395ww(d)(4)(D)) 

relating to the prohibition of payments based on the presence of 

a secondary diagnosis code specified by the Secretary in such regulations, as appropriate for the Medicaid program. The Secretary may 

exclude certain conditions identified under title XVIII of the Social 

Security Act for non-payment under title XIX of such Act when 

the Secretary finds the inclusion of such conditions to be inapplicable to beneficiaries under title XIX. 

SEC. 2703. STATE OPTION TO PROVIDE HEALTH HOMES FOR 

ENROLLEES WITH CHRONIC CONDITIONS. 

(a) STATE PLAN AMENDMENT.—Title XIX of the Social Security 

Act (42 U.S.C. 1396a et seq.), as amended by sections 2201 and 

2305, is amended by adding at the end the following new section: 

‘‘SEC. 1945. STATE OPTION TO PROVIDE COORDINATED CARE

THROUGH A HEALTH HOME FOR INDIVIDUALS WITH CHRONIC CONDITIONS.— 

‘‘(a) IN GENERAL.—Notwithstanding section 1902(a)(1) (relating 

to statewideness), section 1902(a)(10)(B) (relating to comparability), 

and any other provision of this title for which the Secretary determines it is necessary to waive in order to implement this section, 

beginning January 1, 2011, a State, at its option as a State plan 

amendment, may provide for medical assistance under this title 

to eligible individuals with chronic conditions who select a designated provider (as described under subsection (h)(5)), a team 

of health care professionals (as described under subsection (h)(6)) 

operating with such a provider, or a health team (as described 

under subsection (h)(7)) as the individual’s health home for purposes 

of providing the individual with health home services. 

‘‘(b) HEALTH HOME QUALIFICATION STANDARDS.—The Secretary 

shall establish standards for qualification as a designated provider 

for the purpose of being eligible to be a health home for purposes 

of this section. 

‘‘(c) PAYMENTS.— 

‘‘(1) IN GENERAL.—A State shall provide a designated provider, a team of health care professionals operating with such 

a provider, or a health team with payments for the provision 

of health home services to each eligible individual with chronic 

conditions that selects such provider, team of health care professionals, or health team as the individual’s health home. Payments made to a designated provider, a team of health care 

professionals operating with such a provider, or a health team 

for such services shall be treated as medical assistance for 

purposes of section 1903(a), except that, during the first 8 

fiscal year quarters that the State plan amendment is in effect, 

the Federal medical assistance percentage applicable to such 

payments shall be equal to 90 percent. 

‘‘(2) METHODOLOGY.— 

‘‘(A) IN GENERAL.—The State shall specify in the State 

plan amendment the methodology the State will use for 

determining payment for the provision of health home services. Such methodology for determining payment— 
H. R. 3590—202 

‘‘(i) may be tiered to reflect, with respect to each 

eligible individual with chronic conditions provided 

such services by a designated provider, a team of health 

care professionals operating with such a provider, or 

a health team, as well as the severity or number of 

each such individual’s chronic conditions or the specific 

capabilities of the provider, team of health care professionals, or health team; and 

‘‘(ii) shall be established consistent with section 

1902(a)(30)(A). 

‘‘(B) ALTERNATE MODELS OF PAYMENT.—The methodology for determining payment for provision of health home 

services under this section shall not be limited to a permember per-month basis and may provide (as proposed 

by the State and subject to approval by the Secretary) 

for alternate models of payment. 

‘‘(3) PLANNING GRANTS.— 

‘‘(A) IN GENERAL.—Beginning January 1, 2011, the Secretary may award planning grants to States for purposes 

of developing a State plan amendment under this section. 

A planning grant awarded to a State under this paragraph 

shall remain available until expended. 

‘‘(B) STATE CONTRIBUTION.—A State awarded a planning grant shall contribute an amount equal to the State 

percentage determined under section 1905(b) (without 

regard to section 5001 of Public Law 111–5) for each fiscal 

year for which the grant is awarded. 

‘‘(C) LIMITATION.—The total amount of payments made 

to States under this paragraph shall not exceed 

$25,000,000. 

‘‘(d) HOSPITAL REFERRALS.—A State shall include in the State 

plan amendment a requirement for hospitals that are participating 

providers under the State plan or a waiver of such plan to establish 

procedures for referring any eligible individuals with chronic conditions who seek or need treatment in a hospital emergency department to designated providers. 

‘‘(e) COORDINATION.—A State shall consult and coordinate, as 

appropriate, with the Substance Abuse and Mental Health Services 

Administration in addressing issues regarding the prevention and 

treatment of mental illness and substance abuse among eligible 

individuals with chronic conditions. 

‘‘(f) MONITORING.—A State shall include in the State plan 

amendment— 

‘‘(1) a methodology for tracking avoidable hospital readmissions and calculating savings that result from improved chronic 

care coordination and management under this section; and 

‘‘(2) a proposal for use of health information technology 

in providing health home services under this section and 

improving service delivery and coordination across the care 

continuum (including the use of wireless patient technology 

to improve coordination and management of care and patient 

adherence to recommendations made by their provider). 

‘‘(g) REPORT ON QUALITY MEASURES.—As a condition for 

receiving payment for health home services provided to an eligible 

individual with chronic conditions, a designated provider shall 

report to the State, in accordance with such requirements as the 

Secretary shall specify, on all applicable measures for determining 
H. R. 3590—203 

the quality of such services. When appropriate and feasible, a 

designated provider shall use health information technology in providing the State with such information. 

‘‘(h) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE INDIVIDUAL WITH CHRONIC CONDITIONS.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

term ‘eligible individual with chronic conditions’ means 

an individual who— 

‘‘(i) is eligible for medical assistance under the 

State plan or under a waiver of such plan; and 

‘‘(ii) has at least— 

‘‘(I) 2 chronic conditions; 

‘‘(II) 1 chronic condition and is at risk of 

having a second chronic condition; or 

‘‘(III) 1 serious and persistent mental health 

condition. 

‘‘(B) RULE OF CONSTRUCTION.—Nothing in this paragraph shall prevent the Secretary from establishing higher 

levels as to the number or severity of chronic or mental 

health conditions for purposes of determining eligibility 

for receipt of health home services under this section. 

‘‘(2) CHRONIC CONDITION.—The term ‘chronic condition’ has 

the meaning given that term by the Secretary and shall include, 

but is not limited to, the following: 

‘‘(A) A mental health condition. 

‘‘(B) Substance use disorder. 

‘‘(C) Asthma. 

‘‘(D) Diabetes. 

‘‘(E) Heart disease. 

‘‘(F) Being overweight, as evidenced by having a Body 

Mass Index (BMI) over 25. 

‘‘(3) HEALTH HOME.—The term ‘health home’ means a designated provider (including a provider that operates in coordination with a team of health care professionals) or a health 

team selected by an eligible individual with chronic conditions 

to provide health home services. 

‘‘(4) HEALTH HOME SERVICES.— ‘‘(A) IN GENERAL.—The term ‘health home services’ 

means comprehensive and timely high-quality services 

described in subparagraph (B) that are provided by a designated provider, a team of health care professionals operating with such a provider, or a health team. 

‘‘(B) SERVICES DESCRIBED.—The services described in 

this subparagraph are— 

‘‘(i) comprehensive care management; 

‘‘(ii) care coordination and health promotion; 

‘‘(iii) comprehensive transitional care, including 

appropriate follow-up, from inpatient to other settings; 

‘‘(iv) patient and family support (including authorized representatives); 

‘‘(v) referral to community and social support services, if relevant; and 

‘‘(vi) use of health information technology to link 

services, as feasible and appropriate. 

‘‘(5) DESIGNATED PROVIDER.—The term ‘designated provider’ 

means a physician, clinical practice or clinical group practice, 

rural clinic, community health center, community mental health 
H. R. 3590—204 

center, home health agency, or any other entity or provider 

(including pediatricians, gynecologists, and obstetricians) that 

is determined by the State and approved by the Secretary 

to be qualified to be a health home for eligible individuals 

with chronic conditions on the basis of documentation 

evidencing that the physician, practice, or clinic— 

‘‘(A) has the systems and infrastructure in place to 

provide health home services; and 

‘‘(B) satisfies the qualification standards established 

by the Secretary under subsection (b). 

‘‘(6) TEAM OF HEALTH CARE PROFESSIONALS.—The term 

‘team of health care professionals’ means a team of health 

professionals (as described in the State plan amendment) that 

may— 

‘‘(A) include physicians and other professionals, such 

as a nurse care coordinator, nutritionist, social worker, 

behavioral health professional, or any professionals deemed 

appropriate by the State; and 

‘‘(B) be free standing, virtual, or based at a hospital, 

community health center, community mental health center, 

rural clinic, clinical practice or clinical group practice, academic health center, or any entity deemed appropriate 

by the State and approved by the Secretary. 

‘‘(7) HEALTH TEAM.—The term ‘health team’ has the 

meaning given such term for purposes of section 3502 of the 

Patient Protection and Affordable Care Act.’’. 

(b) EVALUATION.— (1) INDEPENDENT EVALUATION.— (A) IN GENERAL.—The Secretary shall enter into a contract with an independent entity or organization to conduct 

an evaluation and assessment of the States that have 

elected the option to provide coordinated care through a 

health home for Medicaid beneficiaries with chronic conditions under section 1945 of the Social Security Act (as 

added by subsection (a)) for the purpose of determining 

the effect of such option on reducing hospital admissions, 

emergency room visits, and admissions to skilled nursing 

facilities. 

(B) EVALUATION REPORT.—Not later than January 1, 

2017, the Secretary shall report to Congress on the evaluation and assessment conducted under subparagraph (A). 

(2) SURVEY AND INTERIM REPORT.— 

(A) IN GENERAL.—Not later than January 1, 2014, the 

Secretary of Health and Human Services shall survey 

States that have elected the option under section 1945 

of the Social Security Act (as added by subsection (a)) 

and report to Congress on the nature, extent, and use 

of such option, particularly as it pertains to— 

(i) hospital admission rates; 

(ii) chronic disease management; 

(iii) coordination of care for individuals with 

chronic conditions; 

(iv) assessment of program implementation; 

(v) processes and lessons learned (as described in 

subparagraph (B)); 

(vi) assessment of quality improvements and clinical outcomes under such option; and 
H. R. 3590—205 

(vii) estimates of cost savings. 

(B) IMPLEMENTATION REPORTING.—A State that has 

elected the option under section 1945 of the Social Security 

Act (as added by subsection (a)) shall report to the Secretary, as necessary, on processes that have been developed 

and lessons learned regarding provision of coordinated care 

through a health home for Medicaid beneficiaries with 

chronic conditions under such option. 

SEC. 2704. DEMONSTRATION PROJECT TO EVALUATE INTEGRATED 

CARE AROUND A HOSPITALIZATION. 

(a) AUTHORITY TO CONDUCT PROJECT.— 

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

Services (in this section referred to as the ‘‘Secretary’’) shall 

establish a demonstration project under title XIX of the Social 

Security Act to evaluate the use of bundled payments for the 

provision of integrated care for a Medicaid beneficiary— 

(A) with respect to an episode of care that includes 

a hospitalization; and 

(B) for concurrent physicians services provided during 

a hospitalization. 

(2) DURATION.—The demonstration project shall begin on 

January 1, 2012, and shall end on December 31, 2016. 

(b) REQUIREMENTS.—The demonstration project shall be conducted in accordance with the following: 

(1) The demonstration project shall be conducted in up 

to 8 States, determined by the Secretary based on consideration 

of the potential to lower costs under the Medicaid program 

while improving care for Medicaid beneficiaries. A State 

selected to participate in the demonstration project may target 

the demonstration project to particular categories of beneficiaries, beneficiaries with particular diagnoses, or particular 

geographic regions of the State, but the Secretary shall insure 

that, as a whole, the demonstration project is, to the greatest 

extent possible, representative of the demographic and 

geographic composition of Medicaid beneficiaries nationally. 

(2) The demonstration project shall focus on conditions 

where there is evidence of an opportunity for providers of 

services and suppliers to improve the quality of care furnished 

to Medicaid beneficiaries while reducing total expenditures 

under the State Medicaid programs selected to participate, 

as determined by the Secretary. 

(3) A State selected to participate in the demonstration 

project shall specify the 1 or more episodes of care the State 

proposes to address in the project, the services to be included 

in the bundled payments, and the rationale for the selection 

of such episodes of care and services. The Secretary may modify 

the episodes of care as well as the services to be included 

in the bundled payments prior to or after approving the project. 

The Secretary may also vary such factors among the different 

States participating in the demonstration project. 

(4) The Secretary shall ensure that payments made under 

the demonstration project are adjusted for severity of illness 

and other characteristics of Medicaid beneficiaries within a 

category or having a diagnosis targeted as part of the demonstration project. States shall ensure that Medicaid beneficiaries are not liable for any additional cost sharing than 
H. R. 3590—206 

if their care had not been subject to payment under the demonstration project. 

(5) Hospitals participating in the demonstration project 

shall have or establish robust discharge planning programs 

to ensure that Medicaid beneficiaries requiring post-acute care 

are appropriately placed in, or have ready access to, postacute care settings. 

(6) The Secretary and each State selected to participate 

in the demonstration project shall ensure that the demonstration project does not result in the Medicaid beneficiaries whose 

care is subject to payment under the demonstration project 

being provided with less items and services for which medical 

assistance is provided under the State Medicaid program than 

the items and services for which medical assistance would 

have been provided to such beneficiaries under the State Medicaid program in the absence of the demonstration project. 

(c) WAIVER OF PROVISIONS.—Notwithstanding section 1115(a) 

of the Social Security Act (42 U.S.C. 1315(a)), the Secretary may 

waive such provisions of titles XIX, XVIII, and XI of that Act 

as may be necessary to accomplish the goals of the demonstration, 

ensure beneficiary access to acute and post-acute care, and maintain 

quality of care. 

(d) EVALUATION AND REPORT.— 

(1) DATA.—Each State selected to participate in the demonstration project under this section shall provide to the Secretary, in such form and manner as the Secretary shall specify, 

relevant data necessary to monitor outcomes, costs, and quality, 

and evaluate the rationales for selection of the episodes of 

care and services specified by States under subsection (b)(3). 

(2) REPORT.—Not later than 1 year after the conclusion 

of the demonstration project, the Secretary shall submit a report 

to Congress on the results of the demonstration project. 

SEC. 2705. MEDICAID GLOBAL PAYMENT SYSTEM DEMONSTRATION 

PROJECT. 

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

(referred to in this section as the ‘‘Secretary’’) shall, in coordination 

with the Center for Medicare and Medicaid Innovation (as established under section 1115A of the Social Security Act, as added 

by section 3021 of this Act), establish the Medicaid Global Payment 

System Demonstration Project under which a participating State 

shall adjust the payments made to an eligible safety net hospital 

system or network from a fee-for-service payment structure to a 

global capitated payment model. 

(b) DURATION AND SCOPE.—The demonstration project conducted under this section shall operate during a period of fiscal 

years 2010 through 2012. The Secretary shall select not more than 

5 States to participate in the demonstration project. 

(c) ELIGIBLE SAFETY NET HOSPITAL SYSTEM OR NETWORK.— 

For purposes of this section, the term ‘‘eligible safety net hospital 

system or network’’ means a large, safety net hospital system or 

network (as defined by the Secretary) that operates within a State 

selected by the Secretary under subsection (b). 

(d) EVALUATION.— 

(1) TESTING.—The Innovation Center shall test and 

evaluate the demonstration project conducted under this section 
H. R. 3590—207 

to examine any changes in health care quality outcomes and 

spending by the eligible safety net hospital systems or networks. 

(2) BUDGET NEUTRALITY.—During the testing period under 

paragraph (1), any budget neutrality requirements under section 1115A(b)(3) of the Social Security Act (as so added) shall 

not be applicable. 

(3) MODIFICATION.—During the testing period under paragraph (1), the Secretary may, in the Secretary’s discretion, 

modify or terminate the demonstration project conducted under 

this section. 

(e) REPORT.—Not later than 12 months after the date of completion of the demonstration project under this section, the Secretary 

shall submit to Congress a report containing the results of the 

evaluation and testing conducted under subsection (d), together 

with recommendations for such legislation and administrative 

action as the Secretary determines appropriate. 

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this 

section. 

SEC. 2706. PEDIATRIC ACCOUNTABLE CARE ORGANIZATION DEMONSTRATION PROJECT. 

(a) AUTHORITY TO CONDUCT DEMONSTRATION.— 

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

Services (referred to in this section as the ‘‘Secretary’’) shall 

establish the Pediatric Accountable Care Organization Demonstration Project to authorize a participating State to allow 

pediatric medical providers that meet specified requirements 

to be recognized as an accountable care organization for purposes of receiving incentive payments (as described under subsection (d)), in the same manner as an accountable care 

organization is recognized and provided with incentive payments under section 1899 of the Social Security Act (as added 

by section 3022). 

(2) DURATION.—The demonstration project shall begin on 

January 1, 2012, and shall end on December 31, 2016. 

(b) APPLICATION.—A State that desires to participate in the 

demonstration project under this section shall submit to the Secretary an application at such time, in such manner, and containing 

such information as the Secretary may require. 

(c) REQUIREMENTS.— 

(1) PERFORMANCE GUIDELINES.—The Secretary, in consultation with the States and pediatric providers, shall establish 

guidelines to ensure that the quality of care delivered to individuals by a provider recognized as an accountable care organization under this section is not less than the quality of care 

that would have otherwise been provided to such individuals. 

(2) SAVINGS REQUIREMENT.—A participating State, in consultation with the Secretary, shall establish an annual minimal 

level of savings in expenditures for items and services covered 

under the Medicaid program under title XIX of the Social 

Security Act and the CHIP program under title XXI of such 

Act that must be reached by an accountable care organization 

in order for such organization to receive an incentive payment 

under subsection (d). 

(3) MINIMUM PARTICIPATION PERIOD.—A provider desiring 

to be recognized as an accountable care organization under 
H. R. 3590—208 

the demonstration project shall enter into an agreement with 

the State to participate in the project for not less than a 

3-year period. 

(d) INCENTIVE PAYMENT.—An accountable care organization 

that meets the performance guidelines established by the Secretary 

under subsection (c)(1) and achieves savings greater than the 

annual minimal savings level established by the State under subsection (c)(2) shall receive an incentive payment for such year 

equal to a portion (as determined appropriate by the Secretary) 

of the amount of such excess savings. The Secretary may establish 

an annual cap on incentive payments for an accountable care 

organization. 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this 

section. 

SEC. 2707. MEDICAID EMERGENCY PSYCHIATRIC DEMONSTRATION 

PROJECT. 

(a) AUTHORITY TO CONDUCT DEMONSTRATION PROJECT.—The 

Secretary of Health and Human Services (in this section referred 

to as the ‘‘Secretary’’) shall establish a demonstration project under 

which an eligible State (as described in subsection (c)) shall provide 

payment under the State Medicaid plan under title XIX of the 

Social Security Act to an institution for mental diseases that is 

not publicly owned or operated and that is subject to the requirements of section 1867 of the Social Security Act (42 U.S.C. 1395dd) 

for the provision of medical assistance available under such plan 

to individuals who— 

(1) have attained age 21, but have not attained age 65; 

(2) are eligible for medical assistance under such plan; 

and 

(3) require such medical assistance to stabilize an emergency medical condition. 

(b) STABILIZATION REVIEW.—A State shall specify in its application described in subsection (c)(1) establish a mechanism for how 

it will ensure that institutions participating in the demonstration 

will determine whether or not such individuals have been stabilized 

(as defined in subsection (h)(5)). This mechanism shall commence 

before the third day of the inpatient stay. States participating 

in the demonstration project may manage the provision of services 

for the stabilization of medical emergency conditions through utilization review, authorization, or management practices, or the 

application of medical necessity and appropriateness criteria 

applicable to behavioral health. 

(c) ELIGIBLE STATE DEFINED.— 

(1) IN GENERAL.—An eligible State is a State that has 

made an application and has been selected pursuant to paragraphs (2) and (3). 

(2) APPLICATION.—A State seeking to participate in the 

demonstration project under this section shall submit to the 

Secretary, at such time and in such format as the Secretary 

requires, an application that includes such information, provisions, and assurances, as the Secretary may require. 

(3) SELECTION.—A State shall be determined eligible for 

the demonstration by the Secretary on a competitive basis 

among States with applications meeting the requirements of 
H. R. 3590—209 

paragraph (1). In selecting State applications for the demonstration project, the Secretary shall seek to achieve an appropriate 

national balance in the geographic distribution of such projects. 

(d) LENGTH OF DEMONSTRATION PROJECT.—The demonstration 

project established under this section shall be conducted for a 

period of 3 consecutive years. 

(e) LIMITATIONS ON FEDERAL FUNDING.— 

(1) APPROPRIATION.— 

(A) IN GENERAL.—Out of any funds in the Treasury 

not otherwise appropriated, there is appropriated to carry 

out this section, $75,000,000 for fiscal year 2011. 

(B) BUDGET AUTHORITY.—Subparagraph (A) constitutes 

budget authority in advance of appropriations Act and represents the obligation of the Federal Government to provide 

for the payment of the amounts appropriated under that 

subparagraph. 

(2) 5-YEAR AVAILABILITY.—Funds appropriated under paragraph (1) shall remain available for obligation through 

December 31, 2015. 

(3) LIMITATION ON PAYMENTS.—In no case may— 

(A) the aggregate amount of payments made by the 

Secretary to eligible States under this section exceed 

$75,000,000; or 

(B) payments be provided by the Secretary under this 

section after December 31, 2015. 

(4) FUNDS ALLOCATED TO STATES.—Funds shall be allocated 

to eligible States on the basis of criteria, including a State’s 

application and the availability of funds, as determined by 

the Secretary. 

(5) PAYMENTS TO STATES.—The Secretary shall pay to each 

eligible State, from its allocation under paragraph (4), an 

amount each quarter equal to the Federal medical assistance 

percentage of expenditures in the quarter for medical assistance 

described in subsection (a). As a condition of receiving payment, 

a State shall collect and report information, as determined 

necessary by the Secretary, for the purposes of providing Federal oversight and conducting an evaluation under subsection 

(f)(1). 

(f) EVALUATION AND REPORT TO CONGRESS.— 

(1) EVALUATION.—The Secretary shall conduct an evaluation of the demonstration project in order to determine the 

impact on the functioning of the health and mental health 

service system and on individuals enrolled in the Medicaid 

program and shall include the following: 

(A) An assessment of access to inpatient mental health 

services under the Medicaid program; average lengths of 

inpatient stays; and emergency room visits. 

(B) An assessment of discharge planning by participating hospitals. 

(C) An assessment of the impact of the demonstration 

project on the costs of the full range of mental health 

services (including inpatient, emergency and ambulatory 

care). 

(D) An analysis of the percentage of consumers with 

Medicaid coverage who are admitted to inpatient facilities 

as a result of the demonstration project as compared to 
H. R. 3590—210 

those admitted to these same facilities through other 

means. 

(E) A recommendation regarding whether the demonstration project should be continued after December 31, 

2013, and expanded on a national basis. 

(2) REPORT.—Not later than December 31, 2013, the Secretary shall submit to Congress and make available to the 

public a report on the findings of the evaluation under paragraph (1). 

(g) WAIVER AUTHORITY.— (1) IN GENERAL.—The Secretary shall waive the limitation 

of subdivision (B) following paragraph (28) of section 1905(a) 

of the Social Security Act (42 U.S.C. 1396d(a)) (relating to 

limitations on payments for care or services for individuals 

under 65 years of age who are patients in an institution for 

mental diseases) for purposes of carrying out the demonstration 

project under this section. 

(2) LIMITED OTHER WAIVER AUTHORITY.—The Secretary may 

waive other requirements of titles XI and XIX of the Social 

Security Act (including the requirements of sections 1902(a)(1) 

(relating to statewideness) and 1902(1)(10)(B) (relating to comparability)) only to extent necessary to carry out the demonstration project under this section. 

(h) DEFINITIONS.—In this section: 

(1) EMERGENCY MEDICAL CONDITION.—The term ‘‘emergency 

medical condition’’ means, with respect to an individual, an 

individual who expresses suicidal or homicidal thoughts or gestures, if determined dangerous to self or others. 

(2) FEDERAL MEDICAL ASSISTANCE PERCENTAGE.—The term 

‘‘Federal medical assistance percentage’’ has the meaning given 

that term with respect to a State under section 1905(b) of 

the Social Security Act (42 U.S.C. 1396d(b)). 

(3) INSTITUTION FOR MENTAL DISEASES.—The term ‘‘institution for mental diseases’’ has the meaning given to that term 

in section 1905(i) of the Social Security Act (42 U.S.C. 1396d(i)). 

(4) MEDICAL ASSISTANCE.—The term ‘‘medical assistance’’ 

has the meaning given that term in section 1905(a) of the 

Social Security Act (42 U.S.C. 1396d(a)). 

(5) STABILIZED.—The term ‘‘stabilized’’ means, with respect 

to an individual, that the emergency medical condition no longer 

exists with respect to the individual and the individual is 

no longer dangerous to self or others. 

(6) STATE.—The term ‘‘State’’ has the meaning given that 

term for purposes of title XIX of the Social Security Act (42 

U.S.C. 1396 et seq.). 

Subtitle J—Improvements to the Medicaid 

and CHIP Payment and Access Commission (MACPAC) 

SEC. 2801. MACPAC ASSESSMENT OF POLICIES AFFECTING ALL MEDICAID BENEFICIARIES. 

(a) IN GENERAL.—Section 1900 of the Social Security Act (42 

U.S.C. 1396) is amended— 

(1) in subsection (b)— 
H. R. 3590—211 

(A) in paragraph (1)— 

(i) in the paragraph heading, by inserting ‘‘FOR

ALL STATES’’ before ‘‘AND ANNUAL’’; and 

(ii) in subparagraph (A), by striking ‘‘children’s’’; 

(iii) in subparagraph (B), by inserting ‘‘, the Secretary, and States’’ after ‘‘Congress’’; 

(iv) in subparagraph (C), by striking ‘‘March 1’’ 

and inserting ‘‘March 15’’; and 

(v) in subparagraph (D), by striking ‘‘June 1’’ and 

inserting ‘‘June 15’’; 

(B) in paragraph (2)— 

(i) in subparagraph (A)— 

(I) in clause (i)— 

(aa) by inserting ‘‘the efficient provision 

of’’ after ‘‘expenditures for’’; and 

(bb) by striking ‘‘hospital, skilled nursing 

facility, physician, Federally-qualified health 

center, rural health center, and other fees’’ 

and inserting ‘‘payments to medical, dental, 

and health professionals, hospitals, residential 

and long-term care providers, providers of 

home and community based services, Federally-qualified health centers and rural health 

clinics, managed care entities, and providers 

of other covered items and services’’; and 

(II) in clause (iii), by inserting ‘‘(including how 

such factors and methodologies enable such beneficiaries to obtain the services for which they are 

eligible, affect provider supply, and affect providers 

that serve a disproportionate share of low-income 

and other vulnerable populations)’’ after ‘‘beneficiaries’’; 

(ii) by redesignating subparagraphs (B) and (C) 

as subparagraphs (F) and (H), respectively; 

(iii) by inserting after subparagraph (A), the following: 

‘‘(B) ELIGIBILITY POLICIES.—Medicaid and CHIP eligibility policies, including a determination of the degree to 

which Federal and State policies provide health care coverage to needy populations. 

‘‘(C) ENROLLMENT AND RETENTION PROCESSES.—Medicaid and CHIP enrollment and retention processes, 

including a determination of the degree to which Federal 

and State policies encourage the enrollment of individuals 

who are eligible for such programs and screen out individuals who are ineligible, while minimizing the share of 

program expenses devoted to such processes. 

‘‘(D) COVERAGE POLICIES.—Medicaid and CHIP benefit 

and coverage policies, including a determination of the 

degree to which Federal and State policies provide access 

to the services enrollees require to improve and maintain 

their health and functional status. 

‘‘(E) QUALITY OF CARE.—Medicaid and CHIP policies 

as they relate to the quality of care provided under those 

programs, including a determination of the degree to which 

Federal and State policies achieve their stated goals and 
H. R. 3590—212 

interact with similar goals established by other purchasers 

of health care services.’’; 

(iv) by inserting after subparagraph (F) (as redesignated by clause (ii) of this subparagraph), the following: 

‘‘(G) INTERACTIONS WITH MEDICARE AND MEDICAID.— 

Consistent with paragraph (11), the interaction of policies 

under Medicaid and the Medicare program under title 

XVIII, including with respect to how such interactions 

affect access to services, payments, and dual eligible 

individuals.’’ and 

(v) in subparagraph (H) (as so redesignated), by 

inserting ‘‘and preventive, acute, and long-term services and supports’’ after ‘‘barriers’’; 

(C) by redesignating paragraphs (3) through (9) as 

paragraphs (4) through (10), respectively; 

(D) by inserting after paragraph (2), the following new 

paragraph: 

‘‘(3) RECOMMENDATIONS AND REPORTS OF STATE-SPECIFIC

DATA.—MACPAC shall— 

‘‘(A) review national and State-specific Medicaid and 

CHIP data; and 

‘‘(B) submit reports and recommendations to Congress, 

the Secretary, and States based on such reviews.’’; 

(E) in paragraph (4), as redesignated by subparagraph 

(C), by striking ‘‘or any other problems’’ and all that follows 

through the period and inserting ‘‘, as well as other factors 

that adversely affect, or have the potential to adversely 

affect, access to care by, or the health care status of, 

Medicaid and CHIP beneficiaries. MACPAC shall include 

in the annual report required under paragraph (1)(D) a 

description of all such areas or problems identified with 

respect to the period addressed in the report.’’; 

(F) in paragraph (5), as so redesignated,— 

(i) in the paragraph heading, by inserting ‘‘AND

REGULATIONS’’ after ‘‘REPORTS’’; and 

(ii) by striking ‘‘If’’ and inserting the following: 

‘‘(A) CERTAIN SECRETARIAL REPORTS.—If’’; and 

(iii) in the second sentence, by inserting ‘‘and the 

Secretary’’ after ‘‘appropriate committees of Congress’’; 

and 

(iv) by adding at the end the following: 

‘‘(B) REGULATIONS.—MACPAC shall review Medicaid 

and CHIP regulations and may comment through submission of a report to the appropriate committees of Congress 

and the Secretary, on any such regulations that affect 

access, quality, or efficiency of health care.’’; 

(G) in paragraph (10), as so redesignated, by inserting 

‘‘, and shall submit with any recommendations, a report 

on the Federal and State-specific budget consequences of 

the recommendations’’ before the period; and 

(H) by adding at the end the following: 

‘‘(11) CONSULTATION AND COORDINATION WITH MEDPAC.— ‘‘(A) IN GENERAL.—MACPAC shall consult with the 

Medicare Payment Advisory Commission (in this paragraph 

referred to as ‘MedPAC’) established under section 1805 

in carrying out its duties under this section, as appropriate 

and particularly with respect to the issues specified in 
H. R. 3590—213 

paragraph (2) as they relate to those Medicaid beneficiaries 

who are dually eligible for Medicaid and the Medicare 

program under title XVIII, adult Medicaid beneficiaries 

(who are not dually eligible for Medicare), and beneficiaries 

under Medicare. Responsibility for analysis of and recommendations to change Medicare policy regarding Medicare beneficiaries, including Medicare beneficiaries who are 

dually eligible for Medicare and Medicaid, shall rest with 

MedPAC. 

‘‘(B) INFORMATION SHARING.—MACPAC and MedPAC 

shall have access to deliberations and records of the other 

such entity, respectively, upon the request of the other 

such entity. 

‘‘(12) CONSULTATION WITH STATES.—MACPAC shall regularly consult with States in carrying out its duties under this 

section, including with respect to developing processes for carrying out such duties, and shall ensure that input from States 

is taken into account and represented in MACPAC’s recommendations and reports. 

‘‘(13) COORDINATE AND CONSULT WITH THE FEDERAL COORDINATED HEALTH CARE OFFICE.—MACPAC shall coordinate and 

consult with the Federal Coordinated Health Care Office established under section 2081 of the Patient Protection and Affordable Care Act before making any recommendations regarding 

dual eligible individuals. 

‘‘(14) PROGRAMMATIC OVERSIGHT VESTED IN THE SECRETARY.—MACPAC’s authority to make recommendations in 

accordance with this section shall not affect, or be considered 

to duplicate, the Secretary’s authority to carry out Federal 

responsibilities with respect to Medicaid and CHIP.’’; 

(2) in subsection (c)(2)— 

(A) by striking subparagraphs (A) and (B) and inserting 

the following: 

‘‘(A) IN GENERAL.—The membership of MACPAC shall 

include individuals who have had direct experience as 

enrollees or parents or caregivers of enrollees in Medicaid 

or CHIP and individuals with national recognition for their 

expertise in Federal safety net health programs, health 

finance and economics, actuarial science, health plans and 

integrated delivery systems, reimbursement for health care, 

health information technology, and other providers of 

health services, public health, and other related fields, 

who provide a mix of different professions, broad geographic 

representation, and a balance between urban and rural 

representation. 

‘‘(B) INCLUSION.—The membership of MACPAC shall 

include (but not be limited to) physicians, dentists, and 

other health professionals, employers, third-party payers, 

and individuals with expertise in the delivery of health 

services. Such membership shall also include representatives of children, pregnant women, the elderly, individuals 

with disabilities, caregivers, and dual eligible individuals, 

current or former representatives of State agencies responsible for administering Medicaid, and current or former 

representatives of State agencies responsible for administering CHIP.’’. 
H. R. 3590—214 

(3) in subsection (d)(2), by inserting ‘‘and State’’ after ‘‘Federal’’; 

(4) in subsection (e)(1), in the first sentence, by inserting 

‘‘and, as a condition for receiving payments under sections 

1903(a) and 2105(a), from any State agency responsible for 

administering Medicaid or CHIP,’’ after ‘‘United States’’; and 

(5) in subsection (f)— 

(A) in the subsection heading, by striking ‘‘AUTHORIZATION OF APPROPRIATIONS’’ and inserting ‘‘FUNDING’’; 

(B) in paragraph (1), by inserting ‘‘(other than for 

fiscal year 2010)’’ before ‘‘in the same manner’’; and 

(C) by adding at the end the following: 

‘‘(3) FUNDING FOR FISCAL YEAR 2010.— 

‘‘(A) IN GENERAL.—Out of any funds in the Treasury 

not otherwise appropriated, there is appropriated to 

MACPAC to carry out the provisions of this section for 

fiscal year 2010, $9,000,000. 

‘‘(B) TRANSFER OF FUNDS.—Notwithstanding section 

2104(a)(13), from the amounts appropriated in such section 

for fiscal year 2010, $2,000,000 is hereby transferred and 

made available in such fiscal year to MACPAC to carry 

out the provisions of this section. 

‘‘(4) AVAILABILITY.—Amounts made available under paragraphs (2) and (3) to MACPAC to carry out the provisions 

of this section shall remain available until expended.’’. 

(b) CONFORMING MEDPAC AMENDMENTS.—Section 1805(b) of 

the Social Security Act (42 U.S.C. 1395b–6(b)), is amended— 

(1) in paragraph (1)(C), by striking ‘‘March 1 of each year 

(beginning with 1998)’’ and inserting ‘‘March 15’’; 

(2) in paragraph (1)(D), by inserting ‘‘, and (beginning 

with 2012) containing an examination of the topics described 

in paragraph (9), to the extent feasible’’ before the period; 

and 

(3) by adding at the end the following: 

‘‘(9) REVIEW AND ANNUAL REPORT ON MEDICAID AND

COMMERCIAL TRENDS.—The Commission shall review and report 

on aggregate trends in spending, utilization, and financial 

performance under the Medicaid program under title XIX and 

the private market for health care services with respect to 

providers for which, on an aggregate national basis, a significant portion of revenue or services is associated with the Medicaid program. Where appropriate, the Commission shall conduct such review in consultation with the Medicaid and CHIP 

Payment and Access Commission established under section 

1900 (in this section referred to as ‘MACPAC’). 

‘‘(10) COORDINATE AND CONSULT WITH THE FEDERAL COORDI- NATED HEALTH CARE OFFICE.—The Commission shall coordinate 

and consult with the Federal Coordinated Health Care Office 

established under section 2081 of the Patient Protection and 

Affordable Care Act before making any recommendations 

regarding dual eligible individuals. 

‘‘(11) INTERACTION OF MEDICAID AND MEDICARE.—The 

Commission shall consult with MACPAC in carrying out its 

duties under this section, as appropriate. Responsibility for 

analysis of and recommendations to change Medicare policy 

regarding Medicare beneficiaries, including Medicare beneficiaries who are dually eligible for Medicare and Medicaid, 
H. R. 3590—215 

shall rest with the Commission. Responsibility for analysis 

of and recommendations to change Medicaid policy regarding 

Medicaid beneficiaries, including Medicaid beneficiaries who 

are dually eligible for Medicare and Medicaid, shall rest with 

MACPAC.’’. 

Subtitle K—Protections for American 

Indians and Alaska Natives 

SEC. 2901. SPECIAL RULES RELATING TO INDIANS. 

(a) NO COST-SHARING FOR INDIANS WITH INCOME AT OR BELOW

300 PERCENT OF POVERTY ENROLLED IN COVERAGE THROUGH A

STATE EXCHANGE.—For provisions prohibiting cost sharing for 

Indians enrolled in any qualified health plan in the individual 

market through an Exchange, see section 1402(d) of the Patient 

Protection and Affordable Care Act. 

(b) PAYER OF LAST RESORT.—Health programs operated by the 

Indian Health Service, Indian tribes, tribal organizations, and 

Urban Indian organizations (as those terms are defined in section 

4 of the Indian Health Care Improvement Act (25 U.S.C. 1603)) 

shall be the payer of last resort for services provided by such 

Service, tribes, or organizations to individuals eligible for services 

through such programs, notwithstanding any Federal, State, or 

local law to the contrary. 

(c) FACILITATING ENROLLMENT OF INDIANS UNDER THE EXPRESS

LANE OPTION.—Section 1902(e)(13)(F)(ii) of the Social Security Act 

(42 U.S.C. 1396a(e)(13)(F)(ii)) is amended— 

(1) in the clause heading, by inserting ‘‘AND INDIAN TRIBES

AND TRIBAL ORGANIZATIONS’’ after ‘‘AGENCIES’’; and 

(2) by adding at the end the following: 

‘‘(IV) The Indian Health Service, an Indian 

Tribe, Tribal Organization, or Urban Indian 

Organization (as defined in section 1139(c)).’’. 

(d) TECHNICAL CORRECTIONS.—Section 1139(c) of the Social 

Security Act (42 U.S.C. 1320b–9(c)) is amended by striking ‘‘In 

this section’’ and inserting ‘‘For purposes of this section, title XIX, 

and title XXI’’. 

SEC. 2902. ELIMINATION OF SUNSET FOR REIMBURSEMENT FOR ALL 

MEDICARE PART B SERVICES FURNISHED BY CERTAIN 

INDIAN HOSPITALS AND CLINICS. 

(a) REIMBURSEMENT FOR ALL MEDICARE PART B SERVICES FURNISHED BY CERTAIN INDIAN HOSPITALS AND CLINICS.—Section 

1880(e)(1)(A) of the Social Security Act (42 U.S.C. 1395qq(e)(1)(A)) 

is amended by striking ‘‘during the 5-year period beginning on’’ 

and inserting ‘‘on or after’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to items or services furnished on or after January 

1, 2010. 
H. R. 3590—216 

Subtitle L—Maternal and Child Health 

Services 

SEC. 2951. MATERNAL, INFANT, AND EARLY CHILDHOOD HOME VISITING PROGRAMS. 

Title V of the Social Security Act (42 U.S.C. 701 et seq.) 

is amended by adding at the end the following new section: 

‘‘SEC. 511. MATERNAL, INFANT, AND EARLY CHILDHOOD HOME VISITING PROGRAMS. 

‘‘(a) PURPOSES.—The purposes of this section are— 

‘‘(1) to strengthen and improve the programs and activities 

carried out under this title; 

‘‘(2) to improve coordination of services for at risk communities; and 

‘‘(3) to identify and provide comprehensive services to 

improve outcomes for families who reside in at risk communities. 

‘‘(b) REQUIREMENT FOR ALL STATES TO ASSESS STATEWIDE

NEEDS AND IDENTIFY AT RISK COMMUNITIES.— ‘‘(1) IN GENERAL.—Not later than 6 months after the date 

of enactment of this section, each State shall, as a condition 

of receiving payments from an allotment for the State under 

section 502 for fiscal year 2011, conduct a statewide needs 

assessment (which shall be separate from the statewide needs 

assessment required under section 505(a)) that identifies— 

‘‘(A) communities with concentrations of— 

‘‘(i) premature birth, low-birth weight infants, and 

infant mortality, including infant death due to neglect, 

or other indicators of at-risk prenatal, maternal, newborn, or child health; 

‘‘(ii) poverty; 

‘‘(iii) crime; 

‘‘(iv) domestic violence; 

‘‘(v) high rates of high-school drop-outs; 

‘‘(vi) substance abuse; 

‘‘(vii) unemployment; or 

‘‘(viii) child maltreatment; 

‘‘(B) the quality and capacity of existing programs or 

initiatives for early childhood home visitation in the State 

including— 

‘‘(i) the number and types of individuals and families who are receiving services under such programs 

or initiatives; 

‘‘(ii) the gaps in early childhood home visitation 

in the State; and 

‘‘(iii) the extent to which such programs or initiatives are meeting the needs of eligible families 

described in subsection (k)(2); and 

‘‘(C) the State’s capacity for providing substance abuse 

treatment and counseling services to individuals and families in need of such treatment or services. 

‘‘(2) COORDINATION WITH OTHER ASSESSMENTS.—In conducting the statewide needs assessment required under paragraph (1), the State shall coordinate with, and take into 

account, other appropriate needs assessments conducted by 
H. R. 3590—217 

the State, as determined by the Secretary, including the needs 

assessment required under section 505(a) (both the most 

recently completed assessment and any such assessment in 

progress), the communitywide strategic planning and needs 

assessments conducted in accordance with section 640(g)(1)(C) 

of the Head Start Act, and the inventory of current unmet 

needs and current community-based and prevention-focused 

programs and activities to prevent child abuse and neglect, 

and other family resource services operating in the State 

required under section 205(3) of the Child Abuse Prevention 

and Treatment Act. 

‘‘(3) SUBMISSION TO THE SECRETARY.—Each State shall 

submit to the Secretary, in such form and manner as the 

Secretary shall require— 

‘‘(A) the results of the statewide needs assessment 

required under paragraph (1); and 

‘‘(B) a description of how the State intends to address 

needs identified by the assessment, particularly with 

respect to communities identified under paragraph (1)(A), 

which may include applying for a grant to conduct an 

early childhood home visitation program in accordance with 

the requirements of this section. 

‘‘(c) GRANTS FOR EARLY CHILDHOOD HOME VISITATION PROGRAMS.— 

‘‘(1) AUTHORITY TO MAKE GRANTS.—In addition to any other 

payments made under this title to a State, the Secretary shall 

make grants to eligible entities to enable the entities to deliver 

services under early childhood home visitation programs that 

satisfy the requirements of subsection (d) to eligible families 

in order to promote improvements in maternal and prenatal 

health, infant health, child health and development, parenting 

related to child development outcomes, school readiness, and 

the socioeconomic status of such families, and reductions in 

child abuse, neglect, and injuries. 

‘‘(2) AUTHORITY TO USE INITIAL GRANT FUNDS FOR PLANNING

OR IMPLEMENTATION.—An eligible entity that receives a grant 

under paragraph (1) may use a portion of the funds made 

available to the entity during the first 6 months of the period 

for which the grant is made for planning or implementation 

activities to assist with the establishment of early childhood 

home visitation programs that satisfy the requirements of subsection (d). 

‘‘(3) GRANT DURATION.—The Secretary shall determine the 

period of years for which a grant is made to an eligible entity 

under paragraph (1). 

‘‘(4) TECHNICAL ASSISTANCE.—The Secretary shall provide 

an eligible entity that receives a grant under paragraph (1) 

with technical assistance in administering programs or activities conducted in whole or in part with grant funds. 

‘‘(d) REQUIREMENTS.—The requirements of this subsection for 

an early childhood home visitation program conducted with a grant 

made under this section are as follows: 

‘‘(1) QUANTIFIABLE, MEASURABLE IMPROVEMENT IN BENCH- MARK AREAS.— ‘‘(A) IN GENERAL.—The eligible entity establishes, subject to the approval of the Secretary, quantifiable, measurable 3- and 5-year benchmarks for demonstrating that the 
H. R. 3590—218 

program results in improvements for the eligible families 

participating in the program in each of the following areas: 

‘‘(i) Improved maternal and newborn health. 

‘‘(ii) Prevention of child injuries, child abuse, 

neglect, or maltreatment, and reduction of emergency 

department visits. 

‘‘(iii) Improvement in school readiness and achievement. 

‘‘(iv) Reduction in crime or domestic violence. 

‘‘(v) Improvements in family economic self-sufficiency. 

‘‘(vi) Improvements in the coordination and referrals for other community resources and supports. 

‘‘(B) DEMONSTRATION OF IMPROVEMENTS AFTER 3

YEARS.— 

‘‘(i) REPORT TO THE SECRETARY.—Not later than 

30 days after the end of the 3rd year in which the 

eligible entity conducts the program, the entity submits 

to the Secretary a report demonstrating improvement 

in at least 4 of the areas specified in subparagraph 

(A). 

‘‘(ii) CORRECTIVE ACTION PLAN.—If the report submitted by the eligible entity under clause (i) fails to 

demonstrate improvement in at least 4 of the areas 

specified in subparagraph (A), the entity shall develop 

and implement a plan to improve outcomes in each 

of the areas specified in subparagraph (A), subject 

to approval by the Secretary. The plan shall include 

provisions for the Secretary to monitor implementation 

of the plan and conduct continued oversight of the 

program, including through submission by the entity 

of regular reports to the Secretary. 

‘‘(iii) TECHNICAL ASSISTANCE.— 

‘‘(I) IN GENERAL.—The Secretary shall provide 

an eligible entity required to develop and implement an improvement plan under clause (ii) with 

technical assistance to develop and implement the 

plan. The Secretary may provide the technical 

assistance directly or through grants, contracts, 

or cooperative agreements. 

‘‘(II) ADVISORY PANEL.—The Secretary shall 

establish an advisory panel for purposes of 

obtaining recommendations regarding the technical assistance provided to entities in accordance 

with subclause (I). 

‘‘(iv) NO IMPROVEMENT OR FAILURE TO SUBMIT

REPORT.—If the Secretary determines after a period 

of time specified by the Secretary that an eligible entity 

implementing an improvement plan under clause (ii) 

has failed to demonstrate any improvement in the 

areas specified in subparagraph (A), or if the Secretary 

determines that an eligible entity has failed to submit 

the report required under clause (i), the Secretary shall 

terminate the entity’s grant and may include any unexpended grant funds in grants made to nonprofit 

organizations under subsection (h)(2)(B). 
H. R. 3590—219 

‘‘(C) FINAL REPORT.—Not later than December 31, 2015, 

the eligible entity shall submit a report to the Secretary 

demonstrating improvements (if any) in each of the areas 

specified in subparagraph (A). 

‘‘(2) IMPROVEMENTS IN OUTCOMES FOR INDIVIDUAL FAMILIES.— 

‘‘(A) IN GENERAL.—The program is designed, with 

respect to an eligible family participating in the program, 

to result in the participant outcomes described in subparagraph (B) that the eligible entity identifies on the basis 

of an individualized assessment of the family, are relevant 

for that family. 

‘‘(B) PARTICIPANT OUTCOMES.—The participant outcomes described in this subparagraph are the following: 

‘‘(i) Improvements in prenatal, maternal, and newborn health, including improved pregnancy outcomes 

‘‘(ii) Improvements in child health and development, including the prevention of child injuries and 

maltreatment and improvements in cognitive, language, social-emotional, and physical developmental 

indicators. 

‘‘(iii) Improvements in parenting skills. 

‘‘(iv) Improvements in school readiness and child 

academic achievement. 

‘‘(v) Reductions in crime or domestic violence. 

‘‘(vi) Improvements in family economic self-sufficiency. 

‘‘(vii) Improvements in the coordination of referrals 

for, and the provision of, other community resources 

and supports for eligible families, consistent with State 

child welfare agency training. 

‘‘(3) CORE COMPONENTS.—The program includes the following core components: 

‘‘(A) SERVICE DELIVERY MODEL OR MODELS.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the program is conducted using 1 or more of the service 

delivery models described in item (aa) or (bb) of subclause (I) or in subclause (II) selected by the eligible 

entity: 

‘‘(I) The model conforms to a clear consistent 

home visitation model that has been in existence 

for at least 3 years and is research-based, grounded 

in relevant empirically-based knowledge, linked to 

program determined outcomes, associated with a 

national organization or institution of higher education that has comprehensive home visitation program standards that ensure high quality service 

delivery and continuous program quality improvement, and has demonstrated significant, (and in 

the case of the service delivery model described 

in item (aa), sustained) positive outcomes, as 

described in the benchmark areas specified in 

paragraph (1)(A) and the participant outcomes 

described in paragraph (2)(B), when evaluated 

using well-designed and rigorous— 
H. R. 3590—220 

‘‘(aa) randomized controlled research 

designs, and the evaluation results have been 

published in a peer-reviewed journal; or 

‘‘(bb) quasi-experimental research designs. 

‘‘(II) The model conforms to a promising and 

new approach to achieving the benchmark areas 

specified in paragraph (1)(A) and the participant 

outcomes described in paragraph (2)(B), has been 

developed or identified by a national organization 

or institution of higher education, and will be 

evaluated through well-designed and rigorous 

process. 

‘‘(ii) MAJORITY OF GRANT FUNDS USED FOR EVIDENCE-BASED MODELS.—An eligible entity shall use not 

more than 25 percent of the amount of the grant paid 

to the entity for a fiscal year for purposes of conducting 

a program using the service delivery model described 

in clause (i)(II). 

‘‘(iii) CRITERIA FOR EVIDENCE OF EFFECTIVENESS

OF MODELS.—The Secretary shall establish criteria for 

evidence of effectiveness of the service delivery models 

and shall ensure that the process for establishing the 

criteria is transparent and provides the opportunity 

for public comment. 

‘‘(B) ADDITIONAL REQUIREMENTS.— ‘‘(i) The program adheres to a clear, consistent 

model that satisfies the requirements of being 

grounded in empirically-based knowledge related to 

home visiting and linked to the benchmark areas specified in paragraph (1)(A) and the participant outcomes 

described in paragraph (2)(B) related to the purposes 

of the program. 

‘‘(ii) The program employs well-trained and competent staff, as demonstrated by education or training, 

such as nurses, social workers, educators, child 

development specialists, or other well-trained and competent staff, and provides ongoing and specific training 

on the model being delivered. 

‘‘(iii) The program maintains high quality supervision to establish home visitor competencies. 

‘‘(iv) The program demonstrates strong organizational capacity to implement the activities involved. 

‘‘(v) The program establishes appropriate linkages 

and referral networks to other community resources 

and supports for eligible families. 

‘‘(vi) The program monitors the fidelity of program 

implementation to ensure that services are delivered 

pursuant to the specified model. 

‘‘(4) PRIORITY FOR SERVING HIGH-RISK POPULATIONS.—The 

eligible entity gives priority to providing services under the 

program to the following: 

‘‘(A) Eligible families who reside in communities in 

need of such services, as identified in the statewide needs 

assessment required under subsection (b)(1)(A). 

‘‘(B) Low-income eligible families. 

‘‘(C) Eligible families who are pregnant women who 

have not attained age 21. 
H. R. 3590—221 

‘‘(D) Eligible families that have a history of child abuse 

or neglect or have had interactions with child welfare services. 

‘‘(E) Eligible families that have a history of substance 

abuse or need substance abuse treatment. 

‘‘(F) Eligible families that have users of tobacco products in the home. 

‘‘(G) Eligible families that are or have children with 

low student achievement. 

‘‘(H) Eligible families with children with developmental 

delays or disabilities. 

‘‘(I) Eligible families who, or that include individuals 

who, are serving or formerly served in the Armed Forces, 

including such families that have members of the Armed 

Forces who have had multiple deployments outside of the 

United States. 

‘‘(e) APPLICATION REQUIREMENTS.—An eligible entity desiring 

a grant under this section shall submit an application to the Secretary for approval, in such manner as the Secretary may require, 

that includes the following: 

‘‘(1) A description of the populations to be served by the 

entity, including specific information regarding how the entity 

will serve high risk populations described in subsection (d)(4). 

‘‘(2) An assurance that the entity will give priority to 

serving low-income eligible families and eligible families who 

reside in at risk communities identified in the statewide needs 

assessment required under subsection (b)(1)(A). 

‘‘(3) The service delivery model or models described in 

subsection (d)(3)(A) that the entity will use under the program 

and the basis for the selection of the model or models. 

‘‘(4) A statement identifying how the selection of the populations to be served and the service delivery model or models 

that the entity will use under the program for such populations 

is consistent with the results of the statewide needs assessment 

conducted under subsection (b). 

‘‘(5) The quantifiable, measurable benchmarks established 

by the State to demonstrate that the program contributes to 

improvements in the areas specified in subsection (d)(1)(A). 

‘‘(6) An assurance that the entity will obtain and submit 

documentation or other appropriate evidence from the organization or entity that developed the service delivery model or 

models used under the program to verify that the program 

is implemented and services are delivered according to the 

model specifications. 

‘‘(7) Assurances that the entity will establish procedures 

to ensure that— 

‘‘(A) the participation of each eligible family in the 

program is voluntary; and 

‘‘(B) services are provided to an eligible family in 

accordance with the individual assessment for that family. 

‘‘(8) Assurances that the entity will— 

‘‘(A) submit annual reports to the Secretary regarding 

the program and activities carried out under the program 

that include such information and data as the Secretary 

shall require; and 

‘‘(B) participate in, and cooperate with, data and 

information collection necessary for the evaluation required 
H. R. 3590—222 

under subsection (g)(2) and other research and evaluation 

activities carried out under subsection (h)(3). 

‘‘(9) A description of other State programs that include 

home visitation services, including, if applicable to the State, 

other programs carried out under this title with funds made 

available from allotments under section 502(c), programs 

funded under title IV, title II of the Child Abuse Prevention 

and Treatment Act (relating to community-based grants for 

the prevention of child abuse and neglect), and section 645A 

of the Head Start Act (relating to Early Head Start programs). 

‘‘(10) Other information as required by the Secretary. 

‘‘(f) MAINTENANCE OF EFFORT.—Funds provided to an eligible 

entity receiving a grant under this section shall supplement, and 

not supplant, funds from other sources for early childhood home 

visitation programs or initiatives. 

‘‘(g) EVALUATION.— 

‘‘(1) INDEPENDENT, EXPERT ADVISORY PANEL.—The Secretary, in accordance with subsection (h)(1)(A), shall appoint 

an independent advisory panel consisting of experts in program 

evaluation and research, education, and early childhood 

development— 

‘‘(A) to review, and make recommendations on, the 

design and plan for the evaluation required under paragraph (2) within 1 year after the date of enactment of 

this section; 

‘‘(B) to maintain and advise the Secretary regarding 

the progress of the evaluation; and 

‘‘(C) to comment, if the panel so desires, on the report 

submitted under paragraph (3). 

‘‘(2) AUTHORITY TO CONDUCT EVALUATION.—On the basis 

of the recommendations of the advisory panel under paragraph 

(1), the Secretary shall, by grant, contract, or interagency agreement, conduct an evaluation of the statewide needs assessments 

submitted under subsection (b) and the grants made under 

subsections (c) and (h)(3)(B). The evaluation shall include— 

‘‘(A) an analysis, on a State-by-State basis, of the 

results of such assessments, including indicators of 

maternal and prenatal health and infant health and mortality, and State actions in response to the assessments; 

and 

‘‘(B) an assessment of— 

‘‘(i) the effect of early childhood home visitation 

programs on child and parent outcomes, including with 

respect to each of the benchmark areas specified in 

subsection (d)(1)(A) and the participant outcomes 

described in subsection (d)(2)(B); 

‘‘(ii) the effectiveness of such programs on different 

populations, including the extent to which the ability 

of programs to improve participant outcomes varies 

across programs and populations; and 

‘‘(iii) the potential for the activities conducted 

under such programs, if scaled broadly, to improve 

health care practices, eliminate health disparities, and 

improve health care system quality, efficiencies, and 

reduce costs. 
H. R. 3590—223 

‘‘(3) REPORT.—Not later than March 31, 2015, the Secretary 

shall submit a report to Congress on the results of the evaluation conducted under paragraph (2) and shall make the report 

publicly available. 

‘‘(h) OTHER PROVISIONS.— 

‘‘(1) INTRA-AGENCY COLLABORATION.—The Secretary shall 

ensure that the Maternal and Child Health Bureau and the 

Administration for Children and Families collaborate with 

respect to carrying out this section, including with respect 

to— 

‘‘(A) reviewing and analyzing the statewide needs 

assessments required under subsection (b), the awarding 

and oversight of grants awarded under this section, the 

establishment of the advisory panels required under subsections (d)(1)(B)(iii)(II) and (g)(1), and the evaluation and 

report required under subsection (g); and 

‘‘(B) consulting with other Federal agencies with 

responsibility for administering or evaluating programs 

that serve eligible families to coordinate and collaborate 

with respect to research related to such programs and 

families, including the Office of the Assistant Secretary 

for Planning and Evaluation of the Department of Health 

and Human Services, the Centers for Disease Control and 

Prevention, the National Institute of Child Health and 

Human Development of the National Institutes of Health, 

the Office of Juvenile Justice and Delinquency Prevention 

of the Department of Justice, and the Institute of Education 

Sciences of the Department of Education. 

‘‘(2) GRANTS TO ELIGIBLE ENTITIES THAT ARE NOT STATES.— 

‘‘(A) INDIAN TRIBES, TRIBAL ORGANIZATIONS, OR URBAN

INDIAN ORGANIZATIONS.—The Secretary shall specify 

requirements for eligible entities that are Indian Tribes 

(or a consortium of Indian Tribes), Tribal Organizations, 

or Urban Indian Organizations to apply for and conduct 

an early childhood home visitation program with a grant 

under this section. Such requirements shall, to the greatest 

extent practicable, be consistent with the requirements 

applicable to eligible entities that are States and shall 

require an Indian Tribe (or consortium), Tribal Organization, or Urban Indian Organization to— 

‘‘(i) conduct a needs assessment similar to the 

assessment required for all States under subsection 

(b); and 

‘‘(ii) establish quantifiable, measurable 3- and 5- 

year benchmarks consistent with subsection (d)(1)(A). 

‘‘(B) NONPROFIT ORGANIZATIONS.—If, as of the beginning of fiscal year 2012, a State has not applied or been 

approved for a grant under this section, the Secretary 

may use amounts appropriated under paragraph (1) of 

subsection (j) that are available for expenditure under paragraph (3) of that subsection to make a grant to an eligible 

entity that is a nonprofit organization described in subsection (k)(1)(B) to conduct an early childhood home visitation program in the State. The Secretary shall specify 

the requirements for such an organization to apply for 

and conduct the program which shall, to the greatest extent 

practicable, be consistent with the requirements applicable 
H. R. 3590—224 

to eligible entities that are States and shall require the 

organization to— 

‘‘(i) carry out the program based on the needs 

assessment conducted by the State under subsection 

(b); and 

‘‘(ii) establish quantifiable, measurable 3- and 5- 

year benchmarks consistent with subsection (d)(1)(A). 

‘‘(3) RESEARCH AND OTHER EVALUATION ACTIVITIES.— 

‘‘(A) IN GENERAL.—The Secretary shall carry out a 

continuous program of research and evaluation activities 

in order to increase knowledge about the implementation 

and effectiveness of home visiting programs, using random 

assignment designs to the maximum extent feasible. The 

Secretary may carry out such activities directly, or through 

grants, cooperative agreements, or contracts. 

‘‘(B) REQUIREMENTS.—The Secretary shall ensure 

that— 

‘‘(i) evaluation of a specific program or project is 

conducted by persons or individuals not directly 

involved in the operation of such program or project; 

and 

‘‘(ii) the conduct of research and evaluation activities includes consultation with independent 

researchers, State officials, and developers and providers of home visiting programs on topics including 

research design and administrative data matching. 

‘‘(4) REPORT AND RECOMMENDATION.—Not later than 

December 31, 2015, the Secretary shall submit a report to 

Congress regarding the programs conducted with grants under 

this section. The report required under this paragraph shall 

include— 

‘‘(A) information regarding the extent to which eligible 

entities receiving grants under this section demonstrated 

improvements in each of the areas specified in subsection 

(d)(1)(A); 

‘‘(B) information regarding any technical assistance 

provided under subsection (d)(1)(B)(iii)(I), including the 

type of any such assistance provided; and 

‘‘(C) recommendations for such legislative or administrative action as the Secretary determines appropriate. 

‘‘(i) APPLICATION OF OTHER PROVISIONS OF TITLE.— 

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

the other provisions of this title shall not apply to a grant 

made under this section. 

‘‘(2) EXCEPTIONS.—The following provisions of this title 

shall apply to a grant made under this section to the same 

extent and in the same manner as such provisions apply to 

allotments made under section 502(c): 

‘‘(A) Section 504(b)(6) (relating to prohibition on payments to excluded individuals and entities). 

‘‘(B) Section 504(c) (relating to the use of funds for 

the purchase of technical assistance). 

‘‘(C) Section 504(d) (relating to a limitation on administrative expenditures). 

‘‘(D) Section 506 (relating to reports and audits), but 

only to the extent determined by the Secretary to be appropriate for grants made under this section. 
H. R. 3590—225 

‘‘(E) Section 507 (relating to penalties for false statements). 

‘‘(F) Section 508 (relating to nondiscrimination). 

‘‘(G) Section 509(a) (relating to the administration of 

the grant program). 

‘‘(j) APPROPRIATIONS.— 

‘‘(1) IN GENERAL.—Out of any funds in the Treasury not 

otherwise appropriated, there are appropriated to the Secretary 

to carry out this section— 

‘‘(A) $100,000,000 for fiscal year 2010; 

‘‘(B) $250,000,000 for fiscal year 2011; 

‘‘(C) $350,000,000 for fiscal year 2012; 

‘‘(D) $400,000,000 for fiscal year 2013; and 

‘‘(E) $400,000,000 for fiscal year 2014. 

‘‘(2) RESERVATIONS.—Of the amount appropriated under 

this subsection for a fiscal year, the Secretary shall reserve— 

‘‘(A) 3 percent of such amount for purposes of making 

grants to eligible entities that are Indian Tribes (or a 

consortium of Indian Tribes), Tribal Organizations, or 

Urban Indian Organizations; and 

‘‘(B) 3 percent of such amount for purposes of carrying 

out subsections (d)(1)(B)(iii), (g), and (h)(3). 

‘‘(3) AVAILABILITY.—Funds made available to an eligible 

entity under this section for a fiscal year shall remain available 

for expenditure by the eligible entity through the end of the 

second succeeding fiscal year after award. Any funds that are 

not expended by the eligible entity during the period in which 

the funds are available under the preceding sentence may 

be used for grants to nonprofit organizations under subsection 

(h)(2)(B). 

‘‘(k) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE ENTITY.— 

‘‘(A) IN GENERAL.—The term ‘eligible entity’ means a 

State, an Indian Tribe, Tribal Organization, or Urban 

Indian Organization, Puerto Rico, Guam, the Virgin 

Islands, the Northern Mariana Islands, and American 

Samoa. 

‘‘(B) NONPROFIT ORGANIZATIONS.—Only for purposes of 

awarding grants under subsection (h)(2)(B), such term shall 

include a nonprofit organization with an established record 

of providing early childhood home visitation programs or 

initiatives in a State or several States. 

‘‘(2) ELIGIBLE FAMILY.—The term ‘eligible family’ means— 

‘‘(A) a woman who is pregnant, and the father of the 

child if the father is available; or 

‘‘(B) a parent or primary caregiver of a child, including 

grandparents or other relatives of the child, and foster 

parents, who are serving as the child’s primary caregiver 

from birth to kindergarten entry, and including a noncustodial parent who has an ongoing relationship with, and 

at times provides physical care for, the child. 

‘‘(3) INDIAN TRIBE; TRIBAL ORGANIZATION.—The terms 

‘Indian Tribe’ and ‘Tribal Organization’, and ‘Urban Indian 

Organization’ have the meanings given such terms in section 

4 of the Indian Health Care Improvement Act.’’. 
H. R. 3590—226 

SEC. 2952. SUPPORT, EDUCATION, AND RESEARCH FOR POSTPARTUM 

DEPRESSION. 

(a) RESEARCH ON POSTPARTUM CONDITIONS.— (1) EXPANSION AND INTENSIFICATION OF ACTIVITIES.—The 

Secretary of Health and Human Services (in this subsection 

and subsection (c) referred to as the ‘‘Secretary’’) is encouraged 

to continue activities on postpartum depression or postpartum 

psychosis (in this subsection and subsection (c) referred to 

as ‘‘postpartum conditions’’), including research to expand the 

understanding of the causes of, and treatments for, postpartum 

conditions. Activities under this paragraph shall include conducting and supporting the following: 

(A) Basic research concerning the etiology and causes 

of the conditions. 

(B) Epidemiological studies to address the frequency 

and natural history of the conditions and the differences 

among racial and ethnic groups with respect to the conditions. 

(C) The development of improved screening and diagnostic techniques. 

(D) Clinical research for the development and evaluation of new treatments. 

(E) Information and education programs for health 

care professionals and the public, which may include a 

coordinated national campaign to increase the awareness 

and knowledge of postpartum conditions. Activities under 

such a national campaign may— 

(i) include public service announcements through 

television, radio, and other means; and 

(ii) focus on— 

(I) raising awareness about screening; 

(II) educating new mothers and their families 

about postpartum conditions to promote earlier 

diagnosis and treatment; and 

(III) ensuring that such education includes 

complete information concerning postpartum 

conditions, including its symptoms, methods of 

coping with the illness, and treatment resources. 

(2) SENSE OF CONGRESS REGARDING LONGITUDINAL STUDY

OF RELATIVE MENTAL HEALTH CONSEQUENCES FOR WOMEN OF

RESOLVING A PREGNANCY.— 

(A) SENSE OF CONGRESS.—It is the sense of Congress 

that the Director of the National Institute of Mental Health 

may conduct a nationally representative longitudinal study 

(during the period of fiscal years 2010 through 2019) of 

the relative mental health consequences for women of 

resolving a pregnancy (intended and unintended) in various 

ways, including carrying the pregnancy to term and parenting the child, carrying the pregnancy to term and 

placing the child for adoption, miscarriage, and having 

an abortion. This study may assess the incidence, timing, 

magnitude, and duration of the immediate and long-term 

mental health consequences (positive or negative) of these 

pregnancy outcomes. 

(B) REPORT.—Subject to the completion of the study 

under subsection (a), beginning not later than 5 years 

after the date of the enactment of this Act, and periodically 
H. R. 3590—227 

thereafter for the duration of the study, such Director 

may prepare and submit to the Congress reports on the 

findings of the study. 

(b) GRANTS TO PROVIDE SERVICES TO INDIVIDUALS WITH A

POSTPARTUM CONDITION AND THEIR FAMILIES.—Title V of the Social 

Security Act (42 U.S.C. 701 et seq.), as amended by section 2951, 

is amended by adding at the end the following new section: 

‘‘SEC. 512. SERVICES TO INDIVIDUALS WITH A POSTPARTUM CONDITION AND THEIR FAMILIES. 

‘‘(a) IN GENERAL.—In addition to any other payments made 

under this title to a State, the Secretary may make grants to 

eligible entities for projects for the establishment, operation, and 

coordination of effective and cost-efficient systems for the delivery 

of essential services to individuals with or at risk for postpartum 

conditions and their families. 

‘‘(b) CERTAIN ACTIVITIES.—To the extent practicable and appropriate, the Secretary shall ensure that projects funded under subsection (a) provide education and services with respect to the diagnosis and management of postpartum conditions for individuals 

with or at risk for postpartum conditions and their families. The 

Secretary may allow such projects to include the following: 

‘‘(1) Delivering or enhancing outpatient and home-based 

health and support services, including case management and 

comprehensive treatment services. 

‘‘(2) Delivering or enhancing inpatient care management 

services that ensure the well-being of the mother and family 

and the future development of the infant. 

‘‘(3) Improving the quality, availability, and organization 

of health care and support services (including transportation 

services, attendant care, homemaker services, day or respite 

care, and providing counseling on financial assistance and 

insurance). 

‘‘(4) Providing education about postpartum conditions to 

promote earlier diagnosis and treatment. Such education may 

include— 

‘‘(A) providing complete information on postpartum 

conditions, symptoms, methods of coping with the illness, 

and treatment resources; and 

‘‘(B) in the case of a grantee that is a State, hospital, 

or birthing facility— 

‘‘(i) providing education to new mothers and 

fathers, and other family members as appropriate, concerning postpartum conditions before new mothers 

leave the health facility; and 

‘‘(ii) ensuring that training programs regarding 

such education are carried out at the health facility. 

‘‘(c) INTEGRATION WITH OTHER PROGRAMS.—To the extent practicable and appropriate, the Secretary may integrate the grant 

program under this section with other grant programs carried out 

by the Secretary, including the program under section 330 of the 

Public Health Service Act. 

‘‘(d) REQUIREMENTS.—The Secretary shall establish requirements for grants made under this section that include a limit 

on the amount of grants funds that may be used for administration, 

accounting, reporting, or program oversight functions and a requirement for each eligible entity that receives a grant to submit, for 
H. R. 3590—228 

each grant period, a report to the Secretary that describes how 

grant funds were used during such period. 

‘‘(e) TECHNICAL ASSISTANCE.—The Secretary may provide technical assistance to entities seeking a grant under this section in 

order to assist such entities in complying with the requirements 

of this section. 

‘‘(f) APPLICATION OF OTHER PROVISIONS OF TITLE.— 

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

the other provisions of this title shall not apply to a grant 

made under this section. 

‘‘(2) EXCEPTIONS.—The following provisions of this title 

shall apply to a grant made under this section to the same 

extent and in the same manner as such provisions apply to 

allotments made under section 502(c): 

‘‘(A) Section 504(b)(6) (relating to prohibition on payments to excluded individuals and entities). 

‘‘(B) Section 504(c) (relating to the use of funds for 

the purchase of technical assistance). 

‘‘(C) Section 504(d) (relating to a limitation on administrative expenditures). 

‘‘(D) Section 506 (relating to reports and audits), but 

only to the extent determined by the Secretary to be appropriate for grants made under this section. 

‘‘(E) Section 507 (relating to penalties for false statements). 

‘‘(F) Section 508 (relating to nondiscrimination). 

‘‘(G) Section 509(a) (relating to the administration of 

the grant program). 

‘‘(g) DEFINITIONS.—In this section: 

‘‘(1) The term ‘eligible entity’— 

‘‘(A) means a public or nonprofit private entity; and 

‘‘(B) includes a State or local government, public-private partnership, recipient of a grant under section 330H 

of the Public Health Service Act (relating to the Healthy 

Start Initiative), public or nonprofit private hospital, 

community-based organization, hospice, ambulatory care 

facility, community health center, migrant health center, 

public housing primary care center, or homeless health 

center. 

‘‘(2) The term ‘postpartum condition’ means postpartum 

depression or postpartum psychosis.’’. 

(c) GENERAL PROVISIONS.— 

(1) AUTHORIZATION OF APPROPRIATIONS.—To carry out this 

section and the amendment made by subsection (b), there are 

authorized to be appropriated, in addition to such other sums 

as may be available for such purpose— 

(A) $3,000,000 for fiscal year 2010; and 

(B) such sums as may be necessary for fiscal years 

2011 and 2012. 

(2) REPORT BY THE SECRETARY.— 

(A) STUDY.—The Secretary shall conduct a study on 

the benefits of screening for postpartum conditions. 

(B) REPORT.—Not later than 2 years after the date 

of the enactment of this Act, the Secretary shall complete 

the study required by subparagraph (A) and submit a 

report to the Congress on the results of such study. 
H. R. 3590—229 

SEC. 2953. PERSONAL RESPONSIBILITY EDUCATION. 

Title V of the Social Security Act (42 U.S.C. 701 et seq.), 

as amended by sections 2951 and 2952(c), is amended by adding 

at the end the following: 

‘‘SEC. 513. PERSONAL RESPONSIBILITY EDUCATION. 

‘‘(a) ALLOTMENTS TO STATES.— 

‘‘(1) AMOUNT.— 

‘‘(A) IN GENERAL.—For the purpose described in subsection (b), subject to the succeeding provisions of this 

section, for each of fiscal years 2010 through 2014, the 

Secretary shall allot to each State an amount equal to 

the product of— 

‘‘(i) the amount appropriated under subsection (f) 

for the fiscal year and available for allotments to States 

after the application of subsection (c); and 

‘‘(ii) the State youth population percentage determined under paragraph (2). 

‘‘(B) MINIMUM ALLOTMENT.— 

‘‘(i) IN GENERAL.—Each State allotment under this 

paragraph for a fiscal year shall be at least $250,000. 

‘‘(ii) PRO RATA ADJUSTMENTS.—The Secretary shall 

adjust on a pro rata basis the amount of the State 

allotments determined under this paragraph for a fiscal 

year to the extent necessary to comply with clause 

(i). 

‘‘(C) APPLICATION REQUIRED TO ACCESS ALLOTMENTS.— 

‘‘(i) IN GENERAL.—A State shall not be paid from 

its allotment for a fiscal year unless the State submits 

an application to the Secretary for the fiscal year and 

the Secretary approves the application (or requires 

changes to the application that the State satisfies) 

and meets such additional requirements as the Secretary may specify. 

‘‘(ii) REQUIREMENTS.—The State application shall 

contain an assurance that the State has complied with 

the requirements of this section in preparing and 

submitting the application and shall include the following as well as such additional information as the 

Secretary may require: 

‘‘(I) Based on data from the Centers for Disease Control and Prevention National Center for 

Health Statistics, the most recent pregnancy rates 

for the State for youth ages 10 to 14 and youth 

ages 15 to 19 for which data are available, the 

most recent birth rates for such youth populations 

in the State for which data are available, and 

trends in those rates for the most recently preceding 5-year period for which such data are available. 

‘‘(II) State-established goals for reducing the 

pregnancy rates and birth rates for such youth 

populations. 

‘‘(III) A description of the State’s plan for using 

the State allotments provided under this section 

to achieve such goals, especially among youth 
H. R. 3590—230 

populations that are the most high-risk or vulnerable for pregnancies or otherwise have special circumstances, including youth in foster care, homeless youth, youth with HIV/AIDS, pregnant youth 

who are under 21 years of age, mothers who are 

under 21 years of age, and youth residing in areas 

with high birth rates for youth. 

‘‘(2) STATE YOUTH POPULATION PERCENTAGE.— 

‘‘(A) IN GENERAL.—For purposes of paragraph (1)(A)(ii), 

the State youth population percentage is, with respect to 

a State, the proportion (expressed as a percentage) of— 

‘‘(i) the number of individuals who have attained 

age 10 but not attained age 20 in the State; to 

‘‘(ii) the number of such individuals in all States. 

‘‘(B) DETERMINATION OF NUMBER OF YOUTH.—The 

number of individuals described in clauses (i) and (ii) of 

subparagraph (A) in a State shall be determined on the 

basis of the most recent Bureau of the Census data. 

‘‘(3) AVAILABILITY OF STATE ALLOTMENTS.—Subject to paragraph (4)(A), amounts allotted to a State pursuant to this 

subsection for a fiscal year shall remain available for expenditure by the State through the end of the second succeeding 

fiscal year. 

‘‘(4) AUTHORITY TO AWARD GRANTS FROM STATE ALLOTMENTS

TO LOCAL ORGANIZATIONS AND ENTITIES IN NONPARTICIPATING

STATES.— 

‘‘(A) GRANTS FROM UNEXPENDED ALLOTMENTS.—If a 

State does not submit an application under this section 

for fiscal year 2010 or 2011, the State shall no longer 

be eligible to submit an application to receive funds from 

the amounts allotted for the State for each of fiscal years 

2010 through 2014 and such amounts shall be used by 

the Secretary to award grants under this paragraph for 

each of fiscal years 2012 through 2014. The Secretary also 

shall use any amounts from the allotments of States that 

submit applications under this section for a fiscal year 

that remain unexpended as of the end of the period in 

which the allotments are available for expenditure under 

paragraph (3) for awarding grants under this paragraph. 

‘‘(B) 3-YEAR GRANTS.— 

‘‘(i) IN GENERAL.—The Secretary shall solicit 

applications to award 3-year grants in each of fiscal 

years 2012, 2013, and 2014 to local organizations and 

entities to conduct, consistent with subsection (b), programs and activities in States that do not submit an 

application for an allotment under this section for fiscal 

year 2010 or 2011. 

‘‘(ii) FAITH-BASED ORGANIZATIONS OR CONSORTIA.— The Secretary may solicit and award grants under 

this paragraph to faith-based organizations or consortia. 

‘‘(C) EVALUATION.—An organization or entity awarded 

a grant under this paragraph shall agree to participate 

in a rigorous Federal evaluation. 

‘‘(5) MAINTENANCE OF EFFORT.—No payment shall be made 

to a State from the allotment determined for the State under 

this subsection or to a local organization or entity awarded 
H. R. 3590—231 

a grant under paragraph (4), if the expenditure of non-federal 

funds by the State, organization, or entity for activities, programs, or initiatives for which amounts from allotments and 

grants under this subsection may be expended is less than 

the amount expended by the State, organization, or entity 

for such programs or initiatives for fiscal year 2009. 

‘‘(6) DATA COLLECTION AND REPORTING.—A State or local 

organization or entity receiving funds under this section shall 

cooperate with such requirements relating to the collection 

of data and information and reporting on outcomes regarding 

the programs and activities carried out with such funds, as 

the Secretary shall specify. 

‘‘(b) PURPOSE.— 

‘‘(1) IN GENERAL.—The purpose of an allotment under subsection (a)(1) to a State is to enable the State (or, in the 

case of grants made under subsection (a)(4)(B), to enable a 

local organization or entity) to carry out personal responsibility 

education programs consistent with this subsection. 

‘‘(2) PERSONAL RESPONSIBILITY EDUCATION PROGRAMS.— 

‘‘(A) IN GENERAL.—In this section, the term ‘personal 

responsibility education program’ means a program that 

is designed to educate adolescents on— 

‘‘(i) both abstinence and contraception for the 

prevention of pregnancy and sexually transmitted 

infections, including HIV/AIDS, consistent with the 

requirements of subparagraph (B); and 

‘‘(ii) at least 3 of the adulthood preparation subjects 

described in subparagraph (C). 

‘‘(B) REQUIREMENTS.—The requirements of this 

subparagraph are the following: 

‘‘(i) The program replicates evidence-based effective 

programs or substantially incorporates elements of 

effective programs that have been proven on the basis 

of rigorous scientific research to change behavior, 

which means delaying sexual activity, increasing 

condom or contraceptive use for sexually active youth, 

or reducing pregnancy among youth. 

‘‘(ii) The program is medically-accurate and complete. 

‘‘(iii) The program includes activities to educate 

youth who are sexually active regarding responsible 

sexual behavior with respect to both abstinence and 

the use of contraception. 

‘‘(iv) The program places substantial emphasis on 

both abstinence and contraception for the prevention 

of pregnancy among youth and sexually transmitted 

infections. 

‘‘(v) The program provides age-appropriate 

information and activities. 

‘‘(vi) The information and activities carried out 

under the program are provided in the cultural context 

that is most appropriate for individuals in the particular population group to which they are directed. 

‘‘(C) ADULTHOOD PREPARATION SUBJECTS.—The adulthood preparation subjects described in this subparagraph 

are the following: 
H. R. 3590—232 

‘‘(i) Healthy relationships, such as positive selfesteem and relationship dynamics, friendships, dating, 

romantic involvement, marriage, and family interactions. 

‘‘(ii) Adolescent development, such as the development of healthy attitudes and values about adolescent 

growth and development, body image, racial and ethnic 

diversity, and other related subjects. 

‘‘(iii) Financial literacy. 

‘‘(iv) Parent-child communication. 

‘‘(v) Educational and career success, such as developing skills for employment preparation, job seeking, 

independent living, financial self-sufficiency, and workplace productivity. 

‘‘(vi) Healthy life skills, such as goal-setting, decision making, negotiation, communication and interpersonal skills, and stress management. 

‘‘(c) RESERVATIONS OF FUNDS.— 

‘‘(1) GRANTS TO IMPLEMENT INNOVATIVE STRATEGIES.—From 

the amount appropriated under subsection (f) for the fiscal 

year, the Secretary shall reserve $10,000,000 of such amount 

for purposes of awarding grants to entities to implement innovative youth pregnancy prevention strategies and target services 

to high-risk, vulnerable, and culturally under-represented youth 

populations, including youth in foster care, homeless youth, 

youth with HIV/AIDS, pregnant women who are under 21 

years of age and their partners, mothers who are under 21 

years of age and their partners, and youth residing in areas 

with high birth rates for youth. An entity awarded a grant 

under this paragraph shall agree to participate in a rigorous 

Federal evaluation of the activities carried out with grant funds. 

‘‘(2) OTHER RESERVATIONS.—From the amount appropriated 

under subsection (f) for the fiscal year that remains after the 

application of paragraph (1), the Secretary shall reserve the 

following amounts: 

‘‘(A) GRANTS FOR INDIAN TRIBES OR TRIBAL ORGANIZA- TIONS.—The Secretary shall reserve 5 percent of such 

remainder for purposes of awarding grants to Indian tribes 

and tribal organizations in such manner, and subject to 

such requirements, as the Secretary, in consultation with 

Indian tribes and tribal organizations, determines appropriate. 

‘‘(B) SECRETARIAL RESPONSIBILITIES.— 

‘‘(i) RESERVATION OF FUNDS.—The Secretary shall 

reserve 10 percent of such remainder for expenditures 

by the Secretary for the activities described in clauses 

(ii) and (iii). 

‘‘(ii) PROGRAM SUPPORT.—The Secretary shall provide, directly or through a competitive grant process, 

research, training and technical assistance, including 

dissemination of research and information regarding 

effective and promising practices, providing consultation and resources on a broad array of teen pregnancy 

prevention strategies, including abstinence and contraception, and developing resources and materials to support the activities of recipients of grants and other 

State, tribal, and community organizations working 
H. R. 3590—233 

to reduce teen pregnancy. In carrying out such functions, the Secretary shall collaborate with a variety 

of entities that have expertise in the prevention of 

teen pregnancy, HIV and sexually transmitted infections, healthy relationships, financial literacy, and 

other topics addressed through the personal responsibility education programs. 

‘‘(iii) EVALUATION.—The Secretary shall evaluate 

the programs and activities carried out with funds 

made available through allotments or grants under 

this section. 

‘‘(d) ADMINISTRATION.— 

‘‘(1) IN GENERAL.—The Secretary shall administer this section through the Assistant Secretary for the Administration 

for Children and Families within the Department of Health 

and Human Services. 

‘‘(2) APPLICATION OF OTHER PROVISIONS OF TITLE.— 

‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), the other provisions of this title shall not apply to 

allotments or grants made under this section. 

‘‘(B) EXCEPTIONS.—The following provisions of this title 

shall apply to allotments and grants made under this section to the same extent and in the same manner as such 

provisions apply to allotments made under section 502(c): 

‘‘(i) Section 504(b)(6) (relating to prohibition on 

payments to excluded individuals and entities). 

‘‘(ii) Section 504(c) (relating to the use of funds 

for the purchase of technical assistance). 

‘‘(iii) Section 504(d) (relating to a limitation on 

administrative expenditures). 

‘‘(iv) Section 506 (relating to reports and audits), 

but only to the extent determined by the Secretary 

to be appropriate for grants made under this section. 

‘‘(v) Section 507 (relating to penalties for false 

statements). 

‘‘(vi) Section 508 (relating to nondiscrimination). 

‘‘(e) DEFINITIONS.—In this section: 

‘‘(1) AGE-APPROPRIATE.—The term ‘age-appropriate’, with 

respect to the information in pregnancy prevention, means 

topics, messages, and teaching methods suitable to particular 

ages or age groups of children and adolescents, based on developing cognitive, emotional, and behavioral capacity typical for 

the age or age group. 

‘‘(2) MEDICALLY ACCURATE AND COMPLETE.—The term 

‘medically accurate and complete’ means verified or supported 

by the weight of research conducted in compliance with accepted 

scientific methods and— 

‘‘(A) published in peer-reviewed journals, where 

applicable; or 

‘‘(B) comprising information that leading professional 

organizations and agencies with relevant expertise in the 

field recognize as accurate, objective, and complete. 

‘‘(3) INDIAN TRIBES; TRIBAL ORGANIZATIONS.—The terms 

‘Indian tribe’ and ‘Tribal organization’ have the meanings given 

such terms in section 4 of the Indian Health Care Improvement 

Act (25 U.S.C. 1603)). 
H. R. 3590—234 

‘‘(4) YOUTH.—The term ‘youth’ means an individual who 

has attained age 10 but has not attained age 20. 

‘‘(f) APPROPRIATION.—For the purpose of carrying out this section, there is appropriated, out of any money in the Treasury 

not otherwise appropriated, $75,000,000 for each of fiscal years 

2010 through 2014. Amounts appropriated under this subsection 

shall remain available until expended.’’. 

SEC. 2954. RESTORATION OF FUNDING FOR ABSTINENCE EDUCATION. 

Section 510 of the Social Security Act (42 U.S.C. 710) is 

amended— 

(1) in subsection (a), by striking ‘‘fiscal year 1998 and 

each subsequent fiscal year’’ and inserting ‘‘each of fiscal years 

2010 through 2014’’; and 

(2) in subsection (d)— 

(A) in the first sentence, by striking ‘‘1998 through 

2003’’ and inserting ‘‘2010 through 2014’’; and 

(B) in the second sentence, by inserting ‘‘(except that 

such appropriation shall be made on the date of enactment 

of the Patient Protection and Affordable Care Act in the 

case of fiscal year 2010)’’ before the period. 

SEC. 2955. INCLUSION OF INFORMATION ABOUT THE IMPORTANCE 

OF HAVING A HEALTH CARE POWER OF ATTORNEY IN 

TRANSITION PLANNING FOR CHILDREN AGING OUT OF 

FOSTER CARE AND INDEPENDENT LIVING PROGRAMS. 

(a) TRANSITION PLANNING.—Section 475(5)(H) of the Social 

Security Act (42 U.S.C. 675(5)(H)) is amended by inserting ‘‘includes 

information about the importance of designating another individual 

to make health care treatment decisions on behalf of the child 

if the child becomes unable to participate in such decisions and 

the child does not have, or does not want, a relative who would 

otherwise be authorized under State law to make such decisions, 

and provides the child with the option to execute a health care 

power of attorney, health care proxy, or other similar document 

recognized under State law,’’ after ‘‘employment services,’’. 

(b) INDEPENDENT LIVING EDUCATION.—Section 477(b)(3) of such 

Act (42 U.S.C. 677(b)(3)) is amended by adding at the end the 

following: 

‘‘(K) A certification by the chief executive officer of 

the State that the State will ensure that an adolescent 

participating in the program under this section are provided with education about the importance of designating 

another individual to make health care treatment decisions 

on behalf of the adolescent if the adolescent becomes unable 

to participate in such decisions and the adolescent does 

not have, or does not want, a relative who would otherwise 

be authorized under State law to make such decisions, 

whether a health care power of attorney, health care proxy, 

or other similar document is recognized under State law, 

and how to execute such a document if the adolescent 

wants to do so.’’. 

(c) HEALTH OVERSIGHT AND COORDINATION PLAN.—Section 

422(b)(15)(A) of such Act (42 U.S.C. 622(b)(15)(A)) is amended— 

(1) in clause (v), by striking ‘‘and’’ at the end; and 

(2) by adding at the end the following: 

‘‘(vii) steps to ensure that the components of the 

transition plan development process required under 
H. R. 3590—235 

section 475(5)(H) that relate to the health care needs 

of children aging out of foster care, including the 

requirements to include options for health insurance, 

information about a health care power of attorney, 

health care proxy, or other similar document recognized under State law, and to provide the child with 

the option to execute such a document, are met; and’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

take effect on October 1, 2010. 

TITLE III—IMPROVING THE QUALITY 

AND EFFICIENCY OF HEALTH CARE 

Subtitle A—Transforming the Health Care 

Delivery System 

PART I—LINKING PAYMENT TO QUALITY 

OUTCOMES UNDER THE MEDICARE PROGRAM 

SEC. 3001. HOSPITAL VALUE-BASED PURCHASING PROGRAM. 

(a) PROGRAM.— 

(1) IN GENERAL.—Section 1886 of the Social Security Act 

(42 U.S.C. 1395ww), as amended by section 4102(a) of the 

HITECH Act (Public Law 111–5), is amended by adding at 

the end the following new subsection: 

‘‘(o) HOSPITAL VALUE-BASED PURCHASING PROGRAM.— 

‘‘(1) ESTABLISHMENT.— 

‘‘(A) IN GENERAL.—Subject to the succeeding provisions 

of this subsection, the Secretary shall establish a hospital 

value-based purchasing program (in this subsection 

referred to as the ‘Program’) under which value-based 

incentive payments are made in a fiscal year to hospitals 

that meet the performance standards under paragraph (3) 

for the performance period for such fiscal year (as established under paragraph (4)). 

‘‘(B) PROGRAM TO BEGIN IN FISCAL YEAR 2013.—The 

Program shall apply to payments for discharges occurring 

on or after October 1, 2012. 

‘‘(C) APPLICABILITY OF PROGRAM TO HOSPITALS.— 

‘‘(i) IN GENERAL.—For purposes of this subsection, 

subject to clause (ii), the term ‘hospital’ means a subsection (d) hospital (as defined in subsection (d)(1)(B)). 

‘‘(ii) EXCLUSIONS.—The term ‘hospital’ shall not 

include, with respect to a fiscal year, a hospital— 

‘‘(I) that is subject to the payment reduction 

under subsection (b)(3)(B)(viii)(I) for such fiscal 

year; 

‘‘(II) for which, during the performance period 

for such fiscal year, the Secretary has cited deficiencies that pose immediate jeopardy to the health 

or safety of patients; 
H. R. 3590—236 

‘‘(III) for which there are not a minimum 

number (as determined by the Secretary) of measures that apply to the hospital for the performance 

period for such fiscal year; or 

‘‘(IV) for which there are not a minimum 

number (as determined by the Secretary) of cases 

for the measures that apply to the hospital for 

the performance period for such fiscal year. 

‘‘(iii) INDEPENDENT ANALYSIS.—For purposes of 

determining the minimum numbers under subclauses 

(III) and (IV) of clause (ii), the Secretary shall have 

conducted an independent analysis of what numbers 

are appropriate. 

‘‘(iv) EXEMPTION.—In the case of a hospital that 

is paid under section 1814(b)(3), the Secretary may 

exempt such hospital from the application of this subsection if the State which is paid under such section 

submits an annual report to the Secretary describing 

how a similar program in the State for a participating 

hospital or hospitals achieves or surpasses the measured results in terms of patient health outcomes and 

cost savings established under this subsection. 

‘‘(2) MEASURES.— 

‘‘(A) IN GENERAL.—The Secretary shall select measures 

for purposes of the Program. Such measures shall be 

selected from the measures specified under subsection 

(b)(3)(B)(viii). 

‘‘(B) REQUIREMENTS.— 

‘‘(i) FOR FISCAL YEAR 2013.—For value-based incentive payments made with respect to discharges occurring during fiscal year 2013, the Secretary shall ensure 

the following: 

‘‘(I) CONDITIONS OR PROCEDURES.—Measures 

are selected under subparagraph (A) that cover 

at least the following 5 specific conditions or procedures: 

‘‘(aa) Acute myocardial infarction (AMI). 

‘‘(bb) Heart failure. 

‘‘(cc) Pneumonia. 

‘‘(dd) Surgeries, as measured by the Surgical Care Improvement Project (formerly 

referred to as ‘Surgical Infection Prevention’ 

for discharges occurring before July 2006). 

‘‘(ee) Healthcare-associated infections, as 

measured by the prevention metrics and targets established in the HHS Action Plan to 

Prevent Healthcare-Associated Infections (or 

any successor plan) of the Department of 

Health and Human Services. 

‘‘(II) HCAHPS.—Measures selected under 

subparagraph (A) shall be related to the Hospital 

Consumer Assessment of Healthcare Providers and 

Systems survey (HCAHPS). 

‘‘(ii) INCLUSION OF EFFICIENCY MEASURES.—For 

value-based incentive payments made with respect to 
H. R. 3590—237 

discharges occurring during fiscal year 2014 or a subsequent fiscal year, the Secretary shall ensure that measures selected under subparagraph (A) include efficiency 

measures, including measures of ‘Medicare spending 

per beneficiary’. Such measures shall be adjusted for 

factors such as age, sex, race, severity of illness, and 

other factors that the Secretary determines appropriate. 

‘‘(C) LIMITATIONS.— 

‘‘(i) TIME REQUIREMENT FOR PRIOR REPORTING AND

NOTICE.—The Secretary may not select a measure 

under subparagraph (A) for use under the Program 

with respect to a performance period for a fiscal year 

(as established under paragraph (4)) unless such 

measure has been specified under subsection 

(b)(3)(B)(viii) and included on the Hospital Compare 

Internet website for at least 1 year prior to the beginning of such performance period. 

‘‘(ii) MEASURE NOT APPLICABLE UNLESS HOSPITAL

FURNISHES SERVICES APPROPRIATE TO THE MEASURE.— 

A measure selected under subparagraph (A) shall not 

apply to a hospital if such hospital does not furnish 

services appropriate to such measure. 

‘‘(D) REPLACING MEASURES.—Subclause (VI) of subsection (b)(3)(B)(viii) shall apply to measures selected under 

subparagraph (A) in the same manner as such subclause 

applies to measures selected under such subsection. 

‘‘(3) PERFORMANCE STANDARDS.— ‘‘(A) ESTABLISHMENT.—The Secretary shall establish 

performance standards with respect to measures selected 

under paragraph (2) for a performance period for a fiscal 

year (as established under paragraph (4)). 

‘‘(B) ACHIEVEMENT AND IMPROVEMENT.—The performance standards established under subparagraph (A) shall 

include levels of achievement and improvement. 

‘‘(C) TIMING.—The Secretary shall establish and 

announce the performance standards under subparagraph 

(A) not later than 60 days prior to the beginning of the 

performance period for the fiscal year involved. 

‘‘(D) CONSIDERATIONS IN ESTABLISHING STANDARDS.— 

In establishing performance standards with respect to 

measures under this paragraph, the Secretary shall take 

into account appropriate factors, such as— 

‘‘(i) practical experience with the measures 

involved, including whether a significant proportion 

of hospitals failed to meet the performance standard 

during previous performance periods; 

‘‘(ii) historical performance standards; 

‘‘(iii) improvement rates; and 

‘‘(iv) the opportunity for continued improvement. 

‘‘(4) PERFORMANCE PERIOD.—For purposes of the Program, 

the Secretary shall establish the performance period for a fiscal 

year. Such performance period shall begin and end prior to 

the beginning of such fiscal year. 

‘‘(5) HOSPITAL PERFORMANCE SCORE.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary shall develop a methodology for assessing the 
H. R. 3590—238 

total performance of each hospital based on performance 

standards with respect to the measures selected under 

paragraph (2) for a performance period (as established 

under paragraph (4)). Using such methodology, the Secretary shall provide for an assessment (in this subsection 

referred to as the ‘hospital performance score’) for each 

hospital for each performance period. 

‘‘(B) APPLICATION.— 

‘‘(i) APPROPRIATE DISTRIBUTION.—The Secretary 

shall ensure that the application of the methodology 

developed under subparagraph (A) results in an appropriate distribution of value-based incentive payments 

under paragraph (6) among hospitals achieving different levels of hospital performance scores, with hospitals achieving the highest hospital performance 

scores receiving the largest value-based incentive payments. 

‘‘(ii) HIGHER OF ACHIEVEMENT OR IMPROVEMENT.— 

The methodology developed under subparagraph (A) 

shall provide that the hospital performance score is 

determined using the higher of its achievement or 

improvement score for each measure. 

‘‘(iii) WEIGHTS.—The methodology developed under 

subparagraph (A) shall provide for the assignment of 

weights for categories of measures as the Secretary 

determines appropriate. 

‘‘(iv) NO MINIMUM PERFORMANCE STANDARD.—The 

Secretary shall not set a minimum performance 

standard in determining the hospital performance score 

for any hospital. 

‘‘(v) REFLECTION OF MEASURES APPLICABLE TO THE

HOSPITAL.—The hospital performance score for a hospital shall reflect the measures that apply to the hospital. 

‘‘(6) CALCULATION OF VALUE-BASED INCENTIVE PAYMENTS.— 

‘‘(A) IN GENERAL.—In the case of a hospital that the 

Secretary determines meets (or exceeds) the performance 

standards under paragraph (3) for the performance period 

for a fiscal year (as established under paragraph (4)), the 

Secretary shall increase the base operating DRG payment 

amount (as defined in paragraph (7)(D)), as determined 

after application of paragraph (7)(B)(i), for a hospital for 

each discharge occurring in such fiscal year by the valuebased incentive payment amount. 

‘‘(B) VALUE-BASED INCENTIVE PAYMENT AMOUNT.—The 

value-based incentive payment amount for each discharge 

of a hospital in a fiscal year shall be equal to the product 

of— 

‘‘(i) the base operating DRG payment amount (as 

defined in paragraph (7)(D)) for the discharge for the 

hospital for such fiscal year; and 

‘‘(ii) the value-based incentive payment percentage 

specified under subparagraph (C) for the hospital for 

such fiscal year. 

‘‘(C) VALUE-BASED INCENTIVE PAYMENT PERCENTAGE.— 
H. R. 3590—239 

‘‘(i) IN GENERAL.—The Secretary shall specify a 

value-based incentive payment percentage for a hospital for a fiscal year. 

‘‘(ii) REQUIREMENTS.—In specifying the valuebased incentive payment percentage for each hospital 

for a fiscal year under clause (i), the Secretary shall 

ensure that— 

‘‘(I) such percentage is based on the hospital 

performance score of the hospital under paragraph 

(5); and 

‘‘(II) the total amount of value-based incentive 

payments under this paragraph to all hospitals 

in such fiscal year is equal to the total amount 

available for value-based incentive payments for 

such fiscal year under paragraph (7)(A), as estimated by the Secretary. 

‘‘(7) FUNDING FOR VALUE-BASED INCENTIVE PAYMENTS.— 

‘‘(A) AMOUNT.—The total amount available for valuebased incentive payments under paragraph (6) for all hospitals for a fiscal year shall be equal to the total amount 

of reduced payments for all hospitals under subparagraph 

(B) for such fiscal year, as estimated by the Secretary. 

‘‘(B) ADJUSTMENT TO PAYMENTS.— 

‘‘(i) IN GENERAL.—The Secretary shall reduce the 

base operating DRG payment amount (as defined in 

subparagraph (D)) for a hospital for each discharge 

in a fiscal year (beginning with fiscal year 2013) by 

an amount equal to the applicable percent (as defined 

in subparagraph (C)) of the base operating DRG payment amount for the discharge for the hospital for 

such fiscal year. The Secretary shall make such reductions for all hospitals in the fiscal year involved, 

regardless of whether or not the hospital has been 

determined by the Secretary to have earned a valuebased incentive payment under paragraph (6) for such 

fiscal year. 

‘‘(ii) NO EFFECT ON OTHER PAYMENTS.—Payments 

described in items (aa) and (bb) of subparagraph 

(D)(i)(II) for a hospital shall be determined as if this 

subsection had not been enacted. 

‘‘(C) APPLICABLE PERCENT DEFINED.—For purposes of 

subparagraph (B), the term ‘applicable percent’ means— 

‘‘(i) with respect to fiscal year 2013, 1.0 percent; 

‘‘(ii) with respect to fiscal year 2014, 1.25 percent; 

‘‘(iii) with respect to fiscal year 2015, 1.5 percent; 

‘‘(iv) with respect to fiscal year 2016, 1.75 percent; 

and 

‘‘(v) with respect to fiscal year 2017 and succeeding 

fiscal years, 2 percent. 

‘‘(D) BASE OPERATING DRG PAYMENT AMOUNT

DEFINED.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), in this subsection, the term ‘base operating DRG 

payment amount’ means, with respect to a hospital 

for a fiscal year— 

‘‘(I) the payment amount that would otherwise 

be made under subsection (d) (determined without 
H. R. 3590—240 

regard to subsection (q)) for a discharge if this 

subsection did not apply; reduced by 

‘‘(II) any portion of such payment amount that 

is attributable to— 

‘‘(aa) payments under paragraphs (5)(A), 

(5)(B), (5)(F), and (12) of subsection (d); and 

‘‘(bb) such other payments under subsection (d) determined appropriate by the Secretary. 

‘‘(ii) SPECIAL RULES FOR CERTAIN HOSPITALS.— 

‘‘(I) SOLE COMMUNITY HOSPITALS AND MEDICARE-DEPENDENT, SMALL RURAL HOSPITALS.—In the 

case of a medicare-dependent, small rural hospital 

(with respect to discharges occurring during fiscal 

year 2012 and 2013) or a sole community hospital, 

in applying subparagraph (A)(i), the payment 

amount that would otherwise be made under subsection (d) shall be determined without regard to 

subparagraphs (I) and (L) of subsection (b)(3) and 

subparagraphs (D) and (G) of subsection (d)(5). 

‘‘(II) HOSPITALS PAID UNDER SECTION 1814.— 

In the case of a hospital that is paid under section 

1814(b)(3), the term ‘base operating DRG payment 

amount’ means the payment amount under such 

section. 

‘‘(8) ANNOUNCEMENT OF NET RESULT OF ADJUSTMENTS.— 

Under the Program, the Secretary shall, not later than 60 

days prior to the fiscal year involved, inform each hospital 

of the adjustments to payments to the hospital for discharges 

occurring in such fiscal year under paragraphs (6) and (7)(B)(i). 

‘‘(9) NO EFFECT IN SUBSEQUENT FISCAL YEARS.—The valuebased incentive payment under paragraph (6) and the payment 

reduction under paragraph (7)(B)(i) shall each apply only with 

respect to the fiscal year involved, and the Secretary shall 

not take into account such value-based incentive payment or 

payment reduction in making payments to a hospital under 

this section in a subsequent fiscal year. 

‘‘(10) PUBLIC REPORTING.— 

‘‘(A) HOSPITAL SPECIFIC INFORMATION.— 

‘‘(i) IN GENERAL.—The Secretary shall make 

information available to the public regarding the 

performance of individual hospitals under the Program, 

including— 

‘‘(I) the performance of the hospital with 

respect to each measure that applies to the hospital; 

‘‘(II) the performance of the hospital with 

respect to each condition or procedure; and 

‘‘(III) the hospital performance score assessing 

the total performance of the hospital. 

‘‘(ii) OPPORTUNITY TO REVIEW AND SUBMIT CORRECTIONS.—The Secretary shall ensure that a hospital has 

the opportunity to review, and submit corrections for, 

the information to be made public with respect to 

the hospital under clause (i) prior to such information 

being made public. 
H. R. 3590—241 

‘‘(iii) WEBSITE.—Such information shall be posted 

on the Hospital Compare Internet website in an easily 

understandable format. 

‘‘(B) AGGREGATE INFORMATION.—The Secretary shall 

periodically post on the Hospital Compare Internet website 

aggregate information on the Program, including— 

‘‘(i) the number of hospitals receiving value-based 

incentive payments under paragraph (6) and the range 

and total amount of such value-based incentive payments; and 

‘‘(ii) the number of hospitals receiving less than 

the maximum value-based incentive payment available 

to the hospital for the fiscal year involved and the 

range and amount of such payments. 

‘‘(11) IMPLEMENTATION.— 

‘‘(A) APPEALS.—The Secretary shall establish a process 

by which hospitals may appeal the calculation of a hospital’s performance assessment with respect to the performance standards established under paragraph (3)(A) and 

the hospital performance score under paragraph (5). The 

Secretary shall ensure that such process provides for resolution of such appeals in a timely manner. 

‘‘(B) LIMITATION ON REVIEW.—Except as provided in 

subparagraph (A), there shall be no administrative or 

judicial review under section 1869, section 1878, or otherwise of the following: 

‘‘(i) The methodology used to determine the amount 

of the value-based incentive payment under paragraph 

(6) and the determination of such amount. 

‘‘(ii) The determination of the amount of funding 

available for such value-based incentive payments 

under paragraph (7)(A) and the payment reduction 

under paragraph (7)(B)(i). 

‘‘(iii) The establishment of the performance standards under paragraph (3) and the performance period 

under paragraph (4). 

‘‘(iv) The measures specified under subsection 

(b)(3)(B)(viii) and the measures selected under paragraph (2). 

‘‘(v) The methodology developed under paragraph 

(5) that is used to calculate hospital performance scores 

and the calculation of such scores. 

‘‘(vi) The validation methodology specified in subsection (b)(3)(B)(viii)(XI). 

‘‘(C) CONSULTATION WITH SMALL HOSPITALS.—The Secretary shall consult with small rural and urban hospitals 

on the application of the Program to such hospitals. 

‘‘(12) PROMULGATION OF REGULATIONS.—The Secretary shall 

promulgate regulations to carry out the Program, including 

the selection of measures under paragraph (2), the methodology 

developed under paragraph (5) that is used to calculate hospital 

performance scores, and the methodology used to determine 

the amount of value-based incentive payments under paragraph 

(6).’’. 

(2) AMENDMENTS FOR REPORTING OF HOSPITAL QUALITY

INFORMATION.—Section 1886(b)(3)(B)(viii) of the Social Security 

Act (42 U.S.C. 1395ww(b)(3)(B)(viii)) is amended— 
H. R. 3590—242 

(A) in subclause (II), by adding at the end the following 

sentence: ‘‘The Secretary may require hospitals to submit 

data on measures that are not used for the determination 

of value-based incentive payments under subsection (o).’’; 

(B) in subclause (V), by striking ‘‘beginning with fiscal 

year 2008’’ and inserting ‘‘for fiscal years 2008 through 

2012’’; 

(C) in subclause (VII), in the first sentence, by striking 

‘‘data submitted’’ and inserting ‘‘information regarding 

measures submitted’’; and 

(D) by adding at the end the following new subclauses: 

‘‘(VIII) Effective for payments beginning with fiscal year 2013, 

with respect to quality measures for outcomes of care, the Secretary 

shall provide for such risk adjustment as the Secretary determines 

to be appropriate to maintain incentives for hospitals to treat 

patients with severe illnesses or conditions. 

‘‘(IX)(aa) Subject to item (bb), effective for payments beginning 

with fiscal year 2013, each measure specified by the Secretary 

under this clause shall be endorsed by the entity with a contract 

under section 1890(a). 

‘‘(bb) In the case of a specified area or medical topic determined 

appropriate by the Secretary for which a feasible and practical 

measure has not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure that is not 

so endorsed as long as due consideration is given to measures 

that have been endorsed or adopted by a consensus organization 

identified by the Secretary. 

‘‘(X) To the extent practicable, the Secretary shall, with input 

from consensus organizations and other stakeholders, take steps 

to ensure that the measures specified by the Secretary under this 

clause are coordinated and aligned with quality measures applicable 

to— 

‘‘(aa) physicians under section 1848(k); and 

‘‘(bb) other providers of services and suppliers under this 

title. 

‘‘(XI) The Secretary shall establish a process to validate measures specified under this clause as appropriate. Such process shall 

include the auditing of a number of randomly selected hospitals 

sufficient to ensure validity of the reporting program under this 

clause as a whole and shall provide a hospital with an opportunity 

to appeal the validation of measures reported by such hospital.’’. 

(3) WEBSITE IMPROVEMENTS.—Section 1886(b)(3)(B) of the 

Social Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended 

by section 4102(b) of the HITECH Act (Public Law 111–5), 

is amended by adding at the end the following new clause: 

‘‘(x)(I) The Secretary shall develop standard Internet website 

reports tailored to meet the needs of various stakeholders such 

as hospitals, patients, researchers, and policymakers. The Secretary 

shall seek input from such stakeholders in determining the type 

of information that is useful and the formats that best facilitate 

the use of the information. 

‘‘(II) The Secretary shall modify the Hospital Compare Internet 

website to make the use and navigation of that website readily 

available to individuals accessing it.’’. 

(4) GAO STUDY AND REPORT.— (A) STUDY.—The Comptroller General of the United 

States shall conduct a study on the performance of the 
H. R. 3590—243 

hospital value-based purchasing program established under 

section 1886(o) of the Social Security Act, as added by 

paragraph (1). Such study shall include an analysis of 

the impact of such program on— 

(i) the quality of care furnished to Medicare beneficiaries, including diverse Medicare beneficiary populations (such as diverse in terms of race, ethnicity, 

and socioeconomic status); 

(ii) expenditures under the Medicare program, 

including any reduced expenditures under Part A of 

title XVIII of such Act that are attributable to the 

improvement in the delivery of inpatient hospital services by reason of such hospital value-based purchasing 

program; 

(iii) the quality performance among safety net hospitals and any barriers such hospitals face in meeting 

the performance standards applicable under such hospital value-based purchasing program; and 

(iv) the quality performance among small rural 

and small urban hospitals and any barriers such hospitals face in meeting the performance standards 

applicable under such hospital value-based purchasing 

program. 

(B) REPORTS.— 

(i) INTERIM REPORT.—Not later than October 1, 

2015, the Comptroller General of the United States 

shall submit to Congress an interim report containing 

the results of the study conducted under subparagraph 

(A), together with recommendations for such legislation 

and administrative action as the Comptroller General 

determines appropriate. 

(ii) FINAL REPORT.—Not later than July 1, 2017, 

the Comptroller General of the United States shall 

submit to Congress a report containing the results 

of the study conducted under subparagraph (A), 

together with recommendations for such legislation and 

administrative action as the Comptroller General 

determines appropriate. 

(5) HHS STUDY AND REPORT.— 

(A) STUDY.—The Secretary of Health and Human Services shall conduct a study on the performance of the hospital value-based purchasing program established under 

section 1886(o) of the Social Security Act, as added by 

paragraph (1). Such study shall include an analysis— 

(i) of ways to improve the hospital value-based 

purchasing program and ways to address any unintended consequences that may occur as a result of 

such program; 

(ii) of whether the hospital value-based purchasing 

program resulted in lower spending under the Medicare program under title XVIII of such Act or other 

financial savings to hospitals; 

(iii) the appropriateness of the Medicare program 

sharing in any savings generated through the hospital 

value-based purchasing program; and 

(iv) any other area determined appropriate by the 

Secretary. 
H. R. 3590—244 

(B) REPORT.—Not later than January 1, 2016, the Secretary of Health and Human Services shall submit to Congress a report containing the results of the study conducted 

under subparagraph (A), together with recommendations 

for such legislation and administrative action as the Secretary determines appropriate. 

(b) VALUE-BASED PURCHASING DEMONSTRATION PROGRAMS.— 

(1) VALUE-BASED PURCHASING DEMONSTRATION PROGRAM

FOR INPATIENT CRITICAL ACCESS HOSPITALS.— 

(A) ESTABLISHMENT.— 

(i) IN GENERAL.—Not later than 2 years after the 

date of enactment of this Act, the Secretary of Health 

and Human Services (in this subsection referred to 

as the ‘‘Secretary’’) shall establish a demonstration program under which the Secretary establishes a valuebased purchasing program under the Medicare program under title XVIII of the Social Security Act for 

critical access hospitals (as defined in paragraph (1) 

of section 1861(mm) of such Act (42 U.S.C. 1395x(mm))) 

with respect to inpatient critical access hospital services (as defined in paragraph (2) of such section) in 

order to test innovative methods of measuring and 

rewarding quality and efficient health care furnished 

by such hospitals. 

(ii) DURATION.—The demonstration program under 

this paragraph shall be conducted for a 3-year period. 

(iii) SITES.—The Secretary shall conduct the demonstration program under this paragraph at an appropriate number (as determined by the Secretary) of 

critical access hospitals. The Secretary shall ensure 

that such hospitals are representative of the spectrum 

of such hospitals that participate in the Medicare program. 

(B) WAIVER AUTHORITY.—The Secretary may waive 

such requirements of titles XI and XVIII of the Social 

Security Act as may be necessary to carry out the demonstration program under this paragraph. 

(C) BUDGET NEUTRALITY REQUIREMENT.—In conducting 

the demonstration program under this section, the Secretary shall ensure that the aggregate payments made 

by the Secretary do not exceed the amount which the 

Secretary would have paid if the demonstration program 

under this section was not implemented. 

(D) REPORT.—Not later than 18 months after the 

completion of the demonstration program under this paragraph, the Secretary shall submit to Congress a report 

on the demonstration program together with— 

(i) recommendations on the establishment of a 

permanent value-based purchasing program under the 

Medicare program for critical access hospitals with 

respect to inpatient critical access hospital services; 

and 

(ii) recommendations for such other legislation and 

administrative action as the Secretary determines 

appropriate. 
H. R. 3590—245 

(2) VALUE-BASED PURCHASING DEMONSTRATION PROGRAM

FOR HOSPITALS EXCLUDED FROM HOSPITAL VALUE-BASED PURCHASING PROGRAM AS A RESULT OF INSUFFICIENT NUMBERS OF

MEASURES AND CASES.— 

(A) ESTABLISHMENT.— 

(i) IN GENERAL.—Not later than 2 years after the 

date of enactment of this Act, the Secretary shall establish a demonstration program under which the Secretary establishes a value-based purchasing program 

under the Medicare program under title XVIII of the 

Social Security Act for applicable hospitals (as defined 

in clause (ii)) with respect to inpatient hospital services 

(as defined in section 1861(b) of the Social Security 

Act (42 U.S.C. 1395x(b))) in order to test innovative 

methods of measuring and rewarding quality and efficient health care furnished by such hospitals. 

(ii) APPLICABLE HOSPITAL DEFINED.—For purposes 

of this paragraph, the term ‘‘applicable hospital’’ means 

a hospital described in subclause (III) or (IV) of section 

1886(o)(1)(C)(ii) of the Social Security Act, as added 

by subsection (a)(1). 

(iii) DURATION.—The demonstration program 

under this paragraph shall be conducted for a 3-year 

period. 

(iv) SITES.—The Secretary shall conduct the demonstration program under this paragraph at an appropriate number (as determined by the Secretary) of 

applicable hospitals. The Secretary shall ensure that 

such hospitals are representative of the spectrum of 

such hospitals that participate in the Medicare program. 

(B) WAIVER AUTHORITY.—The Secretary may waive 

such requirements of titles XI and XVIII of the Social 

Security Act as may be necessary to carry out the demonstration program under this paragraph. 

(C) BUDGET NEUTRALITY REQUIREMENT.—In conducting 

the demonstration program under this section, the Secretary shall ensure that the aggregate payments made 

by the Secretary do not exceed the amount which the 

Secretary would have paid if the demonstration program 

under this section was not implemented. 

(D) REPORT.—Not later than 18 months after the 

completion of the demonstration program under this paragraph, the Secretary shall submit to Congress a report 

on the demonstration program together with— 

(i) recommendations on the establishment of a 

permanent value-based purchasing program under the 

Medicare program for applicable hospitals with respect 

to inpatient hospital services; and 

(ii) recommendations for such other legislation and 

administrative action as the Secretary determines 

appropriate. 

SEC. 3002. IMPROVEMENTS TO THE PHYSICIAN QUALITY REPORTING 

SYSTEM. 

(a) EXTENSION.—Section 1848(m) of the Social Security Act 

(42 U.S.C. 1395w–4(m)) is amended— 
H. R. 3590—246 

(1) in paragraph (1)— 

(A) in subparagraph (A), in the matter preceding clause 

(i), by striking ‘‘2010’’ and inserting ‘‘2014’’; and 

(B) in subparagraph (B)— 

(i) in clause (i), by striking ‘‘and’’ at the end; 

(ii) in clause (ii), by striking the period at the 

end and inserting a semicolon; and 

(iii) by adding at the end the following new clauses: 

‘‘(iii) for 2011, 1.0 percent; and 

‘‘(iv) for 2012, 2013, and 2014, 0.5 percent.’’; 

(2) in paragraph (3)— 

(A) in subparagraph (A), in the matter preceding clause 

(i), by inserting ‘‘(or, for purposes of subsection (a)(8), for 

the quality reporting period for the year)’’ after ‘‘reporting 

period’’; and 

(B) in subparagraph (C)(i), by inserting ‘‘, or, for purposes of subsection (a)(8), for a quality reporting period 

for the year’’ after ‘‘(a)(5), for a reporting period for a 

year’’; 

(3) in paragraph (5)(E)(iv), by striking ‘‘subsection (a)(5)(A)’’ 

and inserting ‘‘paragraphs (5)(A) and (8)(A) of subsection (a)’’; 

and 

(4) in paragraph (6)(C)— 

(A) in clause (i)(II), by striking ‘‘, 2009, 2010, and 

2011’’ and inserting ‘‘and subsequent years’’; and 

(B) in clause (iii)— 

(i) by inserting ‘‘(a)(8)’’ after ‘‘(a)(5)’’; and 

(ii) by striking ‘‘under subparagraph (D)(iii) of such 

subsection’’ and inserting ‘‘under subsection 

(a)(5)(D)(iii) or the quality reporting period under subsection (a)(8)(D)(iii), respectively’’. 

(b) INCENTIVE PAYMENT ADJUSTMENT FOR QUALITY

REPORTING.—Section 1848(a) of the Social Security Act (42 U.S.C. 

1395w–4(a)) is amended by adding at the end the following new 

paragraph: 

‘‘(8) INCENTIVES FOR QUALITY REPORTING.— ‘‘(A) ADJUSTMENT.— ‘‘(i) IN GENERAL.—With respect to covered professional services furnished by an eligible professional 

during 2015 or any subsequent year, if the eligible 

professional does not satisfactorily submit data on 

quality measures for covered professional services for 

the quality reporting period for the year (as determined 

under subsection (m)(3)(A)), the fee schedule amount 

for such services furnished by such professional during 

the year (including the fee schedule amount for purposes of determining a payment based on such amount) 

shall be equal to the applicable percent of the fee 

schedule amount that would otherwise apply to such 

services under this subsection (determined after 

application of paragraphs (3), (5), and (7), but without 

regard to this paragraph). 

‘‘(ii) APPLICABLE PERCENT.—For purposes of clause 

(i), the term ‘applicable percent’ means— 

‘‘(I) for 2015, 98.5 percent; and 

‘‘(II) for 2016 and each subsequent year, 98 

percent. 
H. R. 3590—247 

‘‘(B) APPLICATION.— 

‘‘(i) PHYSICIAN REPORTING SYSTEM RULES.—Paragraphs (5), (6), and (8) of subsection (k) shall apply 

for purposes of this paragraph in the same manner 

as they apply for purposes of such subsection. 

‘‘(ii) INCENTIVE PAYMENT VALIDATION RULES.— 

Clauses (ii) and (iii) of subsection (m)(5)(D) shall apply 

for purposes of this paragraph in a similar manner 

as they apply for purposes of such subsection. 

‘‘(C) DEFINITIONS.—For purposes of this paragraph: 

‘‘(i) ELIGIBLE PROFESSIONAL; COVERED PROFESSIONAL SERVICES.—The terms ‘eligible professional’ and 

‘covered professional services’ have the meanings given 

such terms in subsection (k)(3). 

‘‘(ii) PHYSICIAN REPORTING SYSTEM.—The term 

‘physician reporting system’ means the system established under subsection (k). 

‘‘(iii) QUALITY REPORTING PERIOD.—The term 

‘quality reporting period’ means, with respect to a year, 

a period specified by the Secretary.’’. 

(c) MAINTENANCE OF CERTIFICATION PROGRAMS.— 

(1) IN GENERAL.—Section 1848(k)(4) of the Social Security 

Act (42 U.S.C. 1395w–4(k)(4)) is amended by inserting ‘‘or 

through a Maintenance of Certification program operated by 

a specialty body of the American Board of Medical Specialties 

that meets the criteria for such a registry’’ after ‘‘Database)’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply for years after 2010. 

(d) INTEGRATION OF PHYSICIAN QUALITY REPORTING AND EHR 

REPORTING.—Section 1848(m) of the Social Security Act (42 U.S.C. 

1395w–4(m)) is amended by adding at the end the following new 

paragraph: 

‘‘(7) INTEGRATION OF PHYSICIAN QUALITY REPORTING AND

EHR REPORTING.—Not later than January 1, 2012, the Secretary 

shall develop a plan to integrate reporting on quality measures 

under this subsection with reporting requirements under subsection (o) relating to the meaningful use of electronic health 

records. Such integration shall consist of the following: 

‘‘(A) The selection of measures, the reporting of which 

would both demonstrate— 

‘‘(i) meaningful use of an electronic health record 

for purposes of subsection (o); and 

‘‘(ii) quality of care furnished to an individual. 

‘‘(B) Such other activities as specified by the Secretary.’’. 

(e) FEEDBACK.—Section 1848(m)(5) of the Social Security Act 

(42 U.S.C. 1395w–4(m)(5)) is amended by adding at the end the 

following new subparagraph: 

‘‘(H) FEEDBACK.—The Secretary shall provide timely 

feedback to eligible professionals on the performance of 

the eligible professional with respect to satisfactorily 

submitting data on quality measures under this subsection.’’. 

(f) APPEALS.—Such section is further amended— 

(1) in subparagraph (E), by striking ‘‘There shall’’ and 

inserting ‘‘Except as provided in subparagraph (I), there shall’’; 

and 
H. R. 3590—248 

(2) by adding at the end the following new subparagraph: 

‘‘(I) INFORMAL APPEALS PROCESS.—The Secretary shall, 

by not later than January 1, 2011, establish and have 

in place an informal process for eligible professionals to 

seek a review of the determination that an eligible professional did not satisfactorily submit data on quality measures under this subsection.’’. 

SEC. 3003. IMPROVEMENTS TO THE PHYSICIAN FEEDBACK PROGRAM. 

(a) IN GENERAL.—Section 1848(n) of the Social Security Act 

(42 U.S.C. 1395w–4(n)) is amended— 

(1) in paragraph (1)— 

(A) in subparagraph (A)— 

(i) by striking ‘‘GENERAL.—The Secretary’’ and 

inserting ‘‘GENERAL.— 

‘‘(i) ESTABLISHMENT.—The Secretary’’; 

(ii) in clause (i), as added by clause (i), by striking 

‘‘the ‘Program’)’’ and all that follows through the period 

at the end of the second sentence and inserting ‘‘the 

‘Program’).’’; and 

(iii) by adding at the end the following new clauses: 

‘‘(ii) REPORTS ON RESOURCES.—The Secretary shall 

use claims data under this title (and may use other 

data) to provide confidential reports to physicians (and, 

as determined appropriate by the Secretary, to groups 

of physicians) that measure the resources involved in 

furnishing care to individuals under this title. 

‘‘(iii) INCLUSION OF CERTAIN INFORMATION.—If 

determined appropriate by the Secretary, the Secretary 

may include information on the quality of care furnished to individuals under this title by the physician 

(or group of physicians) in such reports.’’; and 

(B) in subparagraph (B), by striking ‘‘subparagraph 

(A)’’ and inserting ‘‘subparagraph (A)(ii)’’; 

(2) in paragraph (4)— 

(A) in the heading, by inserting ‘‘INITIAL’’ after ‘‘FOCUS’’; 

and 

(B) in the matter preceding subparagraph (A), by 

inserting ‘‘initial’’ after ‘‘focus the’’; 

(3) in paragraph (6), by adding at the end the following 

new sentence: ‘‘For adjustments for reports on utilization under 

paragraph (9), see subparagraph (D) of such paragraph.’’; and 

(4) by adding at the end the following new paragraphs: 

‘‘(9) REPORTS ON UTILIZATION.— 

‘‘(A) DEVELOPMENT OF EPISODE GROUPER.— 

‘‘(i) IN GENERAL.—The Secretary shall develop an 

episode grouper that combines separate but clinically 

related items and services into an episode of care for 

an individual, as appropriate. 

‘‘(ii) TIMELINE FOR DEVELOPMENT.—The episode 

grouper described in subparagraph (A) shall be developed by not later than January 1, 2012. 

‘‘(iii) PUBLIC AVAILABILITY.—The Secretary shall 

make the details of the episode grouper described in 

subparagraph (A) available to the public. 

‘‘(iv) ENDORSEMENT.—The Secretary shall seek 

endorsement of the episode grouper described in 
H. R. 3590—249 

subparagraph (A) by the entity with a contract under 

section 1890(a). 

‘‘(B) REPORTS ON UTILIZATION.—Effective beginning 

with 2012, the Secretary shall provide reports to physicians 

that compare, as determined appropriate by the Secretary, 

patterns of resource use of the individual physician to 

such patterns of other physicians. 

‘‘(C) ANALYSIS OF DATA.—The Secretary shall, for purposes of preparing reports under this paragraph, establish 

methodologies as appropriate, such as to— 

‘‘(i) attribute episodes of care, in whole or in part, 

to physicians; 

‘‘(ii) identify appropriate physicians for purposes 

of comparison under subparagraph (B); and 

‘‘(iii) aggregate episodes of care attributed to a 

physician under clause (i) into a composite measure 

per individual. 

‘‘(D) DATA ADJUSTMENT.—In preparing reports under 

this paragraph, the Secretary shall make appropriate 

adjustments, including adjustments— 

‘‘(i) to account for differences in socioeconomic and 

demographic characteristics, ethnicity, and health 

status of individuals (such as to recognize that less 

healthy individuals may require more intensive interventions); and 

‘‘(ii) to eliminate the effect of geographic adjustments in payment rates (as described in subsection 

(e)). 

‘‘(E) PUBLIC AVAILABILITY OF METHODOLOGY.—The Secretary shall make available to the public— 

‘‘(i) the methodologies established under subparagraph (C); 

‘‘(ii) information regarding any adjustments made 

to data under subparagraph (D); and 

‘‘(iii) aggregate reports with respect to physicians. 

‘‘(F) DEFINITION OF PHYSICIAN.—In this paragraph: 

‘‘(i) IN GENERAL.—The term ‘physician’ has the 

meaning given that term in section 1861(r)(1). 

‘‘(ii) TREATMENT OF GROUPS.—Such term includes, 

as the Secretary determines appropriate, a group of 

physicians. 

‘‘(G) LIMITATIONS ON REVIEW.—There shall be no 

administrative or judicial review under section 1869, section 1878, or otherwise of the establishment of the methodology under subparagraph (C), including the determination 

of an episode of care under such methodology. 

‘‘(10) COORDINATION WITH OTHER VALUE-BASED PURCHASING

REFORMS.—The Secretary shall coordinate the Program with 

the value-based payment modifier established under subsection 

(p) and, as the Secretary determines appropriate, other similar 

provisions of this title.’’. 

(b) CONFORMING AMENDMENT.—Section 1890(b) of the Social 

Security Act (42 U.S.C. 1395aaa(b)) is amended by adding at the 

end the following new paragraph: 

‘‘(6) REVIEW AND ENDORSEMENT OF EPISODE GROUPER UNDER

THE PHYSICIAN FEEDBACK PROGRAM.—The entity shall provide 

for the review and, as appropriate, the endorsement of the 
H. R. 3590—250 

episode grouper developed by the Secretary under section 

1848(n)(9)(A). Such review shall be conducted on an expedited 

basis.’’. 

SEC. 3004. QUALITY REPORTING FOR LONG-TERM CARE HOSPITALS, 

INPATIENT REHABILITATION HOSPITALS, AND HOSPICE 

PROGRAMS. 

(a) LONG-TERM CARE HOSPITALS.—Section 1886(m) of the Social 

Security Act (42 U.S.C. 1395ww(m)), as amended by section 3401(c), 

is amended by adding at the end the following new paragraph: 

‘‘(5) QUALITY REPORTING.— 

‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 

‘‘(i) IN GENERAL.—Under the system described in 

paragraph (1), for rate year 2014 and each subsequent 

rate year, in the case of a long-term care hospital 

that does not submit data to the Secretary in accordance with subparagraph (C) with respect to such a 

rate year, any annual update to a standard Federal 

rate for discharges for the hospital during the rate 

year, and after application of paragraph (3), shall be 

reduced by 2 percentage points. 

‘‘(ii) SPECIAL RULE.—The application of this 

subparagraph may result in such annual update being 

less than 0.0 for a rate year, and may result in payment 

rates under the system described in paragraph (1) 

for a rate year being less than such payment rates 

for the preceding rate year. 

‘‘(B) NONCUMULATIVE APPLICATION.—Any reduction 

under subparagraph (A) shall apply only with respect to 

the rate year involved and the Secretary shall not take 

into account such reduction in computing the payment 

amount under the system described in paragraph (1) for 

a subsequent rate year. 

‘‘(C) SUBMISSION OF QUALITY DATA.—For rate year 2014 

and each subsequent rate year, each long-term care hospital 

shall submit to the Secretary data on quality measures 

specified under subparagraph (D). Such data shall be submitted in a form and manner, and at a time, specified 

by the Secretary for purposes of this subparagraph. 

‘‘(D) QUALITY MEASURES.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), any 

measure specified by the Secretary under this subparagraph must have been endorsed by the entity with 

a contract under section 1890(a). 

‘‘(ii) EXCEPTION.—In the case of a specified area 

or medical topic determined appropriate by the Secretary for which a feasible and practical measure has 

not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure 

that is not so endorsed as long as due consideration 

is given to measures that have been endorsed or 

adopted by a consensus organization identified by the 

Secretary. 

‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 

the Secretary shall publish the measures selected 

under this subparagraph that will be applicable with 

respect to rate year 2014. 
H. R. 3590—251 

‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 

Secretary shall establish procedures for making data submitted under subparagraph (C) available to the public. 

Such procedures shall ensure that a long-term care hospital 

has the opportunity to review the data that is to be made 

public with respect to the hospital prior to such data being 

made public. The Secretary shall report quality measures 

that relate to services furnished in inpatient settings in 

long-term care hospitals on the Internet website of the 

Centers for Medicare & Medicaid Services.’’. 

(b) INPATIENT REHABILITATION HOSPITALS.—Section 1886(j) of 

the Social Security Act (42 U.S.C. 1395ww(j)) is amended— 

(1) by redesignating paragraph (7) as paragraph (8); and 

(2) by inserting after paragraph (6) the following new paragraph: 

‘‘(7) QUALITY REPORTING.— 

‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 

‘‘(i) IN GENERAL.—For purposes of fiscal year 2014 

and each subsequent fiscal year, in the case of a 

rehabilitation facility that does not submit data to 

the Secretary in accordance with subparagraph (C) 

with respect to such a fiscal year, after determining 

the increase factor described in paragraph (3)(C), and 

after application of paragraph (3)(D), the Secretary 

shall reduce such increase factor for payments for discharges occurring during such fiscal year by 2 percentage points. 

‘‘(ii) SPECIAL RULE.—The application of this 

subparagraph may result in the increase factor 

described in paragraph (3)(C) being less than 0.0 for 

a fiscal year, and may result in payment rates under 

this subsection for a fiscal year being less than such 

payment rates for the preceding fiscal year. 

‘‘(B) NONCUMULATIVE APPLICATION.—Any reduction 

under subparagraph (A) shall apply only with respect to 

the fiscal year involved and the Secretary shall not take 

into account such reduction in computing the payment 

amount under this subsection for a subsequent fiscal year. 

‘‘(C) SUBMISSION OF QUALITY DATA.—For fiscal year 

2014 and each subsequent rate year, each rehabilitation 

facility shall submit to the Secretary data on quality measures specified under subparagraph (D). Such data shall 

be submitted in a form and manner, and at a time, specified 

by the Secretary for purposes of this subparagraph. 

‘‘(D) QUALITY MEASURES.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), any 

measure specified by the Secretary under this subparagraph must have been endorsed by the entity with 

a contract under section 1890(a). 

‘‘(ii) EXCEPTION.—In the case of a specified area 

or medical topic determined appropriate by the Secretary for which a feasible and practical measure has 

not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure 

that is not so endorsed as long as due consideration 

is given to measures that have been endorsed or 
H. R. 3590—252 

adopted by a consensus organization identified by the 

Secretary. 

‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 

the Secretary shall publish the measures selected 

under this subparagraph that will be applicable with 

respect to fiscal year 2014. 

‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 

Secretary shall establish procedures for making data submitted under subparagraph (C) available to the public. 

Such procedures shall ensure that a rehabilitation facility 

has the opportunity to review the data that is to be made 

public with respect to the facility prior to such data being 

made public. The Secretary shall report quality measures 

that relate to services furnished in inpatient settings in 

rehabilitation facilities on the Internet website of the Centers for Medicare & Medicaid Services.’’. 

(c) HOSPICE PROGRAMS.—Section 1814(i) of the Social Security 

Act (42 U.S.C. 1395f(i)) is amended— 

(1) by redesignating paragraph (5) as paragraph (6); and 

(2) by inserting after paragraph (4) the following new paragraph: 

‘‘(5) QUALITY REPORTING.— 

‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 

‘‘(i) IN GENERAL.—For purposes of fiscal year 2014 

and each subsequent fiscal year, in the case of a hospice 

program that does not submit data to the Secretary 

in accordance with subparagraph (C) with respect to 

such a fiscal year, after determining the market basket 

percentage increase under paragraph (1)(C)(ii)(VII) or 

paragraph (1)(C)(iii), as applicable, and after application of paragraph (1)(C)(iv), with respect to the fiscal 

year, the Secretary shall reduce such market basket 

percentage increase by 2 percentage points. 

‘‘(ii) SPECIAL RULE.—The application of this 

subparagraph may result in the market basket percentage increase under paragraph (1)(C)(ii)(VII) or paragraph (1)(C)(iii), as applicable, being less than 0.0 for 

a fiscal year, and may result in payment rates under 

this subsection for a fiscal year being less than such 

payment rates for the preceding fiscal year. 

‘‘(B) NONCUMULATIVE APPLICATION.—Any reduction 

under subparagraph (A) shall apply only with respect to 

the fiscal year involved and the Secretary shall not take 

into account such reduction in computing the payment 

amount under this subsection for a subsequent fiscal year. 

‘‘(C) SUBMISSION OF QUALITY DATA.—For fiscal year 

2014 and each subsequent fiscal year, each hospice program 

shall submit to the Secretary data on quality measures 

specified under subparagraph (D). Such data shall be submitted in a form and manner, and at a time, specified 

by the Secretary for purposes of this subparagraph. 

‘‘(D) QUALITY MEASURES.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), any 

measure specified by the Secretary under this subparagraph must have been endorsed by the entity with 

a contract under section 1890(a). 
H. R. 3590—253 

‘‘(ii) EXCEPTION.—In the case of a specified area 

or medical topic determined appropriate by the Secretary for which a feasible and practical measure has 

not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure 

that is not so endorsed as long as due consideration 

is given to measures that have been endorsed or 

adopted by a consensus organization identified by the 

Secretary. 

‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 

the Secretary shall publish the measures selected 

under this subparagraph that will be applicable with 

respect to fiscal year 2014. 

‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 

Secretary shall establish procedures for making data submitted under subparagraph (C) available to the public. 

Such procedures shall ensure that a hospice program has 

the opportunity to review the data that is to be made 

public with respect to the hospice program prior to such 

data being made public. The Secretary shall report quality 

measures that relate to hospice care provided by hospice 

programs on the Internet website of the Centers for Medicare & Medicaid Services.’’. 

SEC. 3005. QUALITY REPORTING FOR PPS-EXEMPT CANCER HOSPITALS. 

Section 1866 of the Social Security Act (42 U.S.C. 1395cc) 

is amended— 

(1) in subsection (a)(1)— 

(A) in subparagraph (U), by striking ‘‘and’’ at the end; 

(B) in subparagraph (V), by striking the period at 

the end and inserting ‘‘, and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(W) in the case of a hospital described in section 

1886(d)(1)(B)(v), to report quality data to the Secretary 

in accordance with subsection (k).’’; and 

(2) by adding at the end the following new subsection: 

‘‘(k) QUALITY REPORTING BY CANCER HOSPITALS.— 

‘‘(1) IN GENERAL.—For purposes of fiscal year 2014 and 

each subsequent fiscal year, a hospital described in section 

1886(d)(1)(B)(v) shall submit data to the Secretary in accordance with paragraph (2) with respect to such a fiscal year. 

‘‘(2) SUBMISSION OF QUALITY DATA.—For fiscal year 2014 

and each subsequent fiscal year, each hospital described in 

such section shall submit to the Secretary data on quality 

measures specified under paragraph (3). Such data shall be 

submitted in a form and manner, and at a time, specified 

by the Secretary for purposes of this subparagraph. 

‘‘(3) QUALITY MEASURES.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), any 

measure specified by the Secretary under this paragraph 

must have been endorsed by the entity with a contract 

under section 1890(a). 

‘‘(B) EXCEPTION.—In the case of a specified area or 

medical topic determined appropriate by the Secretary for 

which a feasible and practical measure has not been 
H. R. 3590—254 

endorsed by the entity with a contract under section 

1890(a), the Secretary may specify a measure that is not 

so endorsed as long as due consideration is given to measures that have been endorsed or adopted by a consensus 

organization identified by the Secretary. 

‘‘(C) TIME FRAME.—Not later than October 1, 2012, 

the Secretary shall publish the measures selected under 

this paragraph that will be applicable with respect to fiscal 

year 2014. 

‘‘(4) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The Secretary shall establish procedures for making data submitted 

under paragraph (4) available to the public. Such procedures 

shall ensure that a hospital described in section 1886(d)(1)(B)(v) 

has the opportunity to review the data that is to be made 

public with respect to the hospital prior to such data being 

made public. The Secretary shall report quality measures of 

process, structure, outcome, patients’ perspective on care, efficiency, and costs of care that relate to services furnished in 

such hospitals on the Internet website of the Centers for Medicare & Medicaid Services.’’. 

SEC. 3006. PLANS FOR A VALUE-BASED PURCHASING PROGRAM FOR 

SKILLED NURSING FACILITIES AND HOME HEALTH 

AGENCIES. 

(a) SKILLED NURSING FACILITIES.— (1) IN GENERAL.—The Secretary of Health and Human 

Services (in this section referred to as the ‘‘Secretary’’) shall 

develop a plan to implement a value-based purchasing program 

for payments under the Medicare program under title XVIII 

of the Social Security Act for skilled nursing facilities (as 

defined in section 1819(a) of such Act (42 U.S.C. 1395i–3(a))). 

(2) DETAILS.—In developing the plan under paragraph (1), 

the Secretary shall consider the following issues: 

(A) The ongoing development, selection, and modification process for measures (including under section 1890 

of the Social Security Act (42 U.S.C. 1395aaa) and section 

1890A such Act, as added by section 3014), to the extent 

feasible and practicable, of all dimensions of quality and 

efficiency in skilled nursing facilities. 

(i) IN GENERAL.—Subject to clause (ii), any measure 

specified by the Secretary under subparagraph (A)(iii) 

must have been endorsed by the entity with a contract 

under section 1890(a). 

(ii) EXCEPTION.—In the case of a specified area 

or medical topic determined appropriate by the Secretary for which a feasible and practical measure has 

not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure 

that is not so endorsed as long as due consideration 

is given to measures that have been endorsed or 

adopted by a consensus organization identified by the 

Secretary. 

(B) The reporting, collection, and validation of quality 

data. 

(C) The structure of value-based payment adjustments, 

including the determination of thresholds or improvements 

in quality that would substantiate a payment adjustment, 
H. R. 3590—255 

the size of such payments, and the sources of funding 

for the value-based bonus payments. 

(D) Methods for the public disclosure of information 

on the performance of skilled nursing facilities. 

(E) Any other issues determined appropriate by the 

Secretary. 

(3) CONSULTATION.—In developing the plan under paragraph (1), the Secretary shall— 

(A) consult with relevant affected parties; and 

(B) consider experience with such demonstrations that 

the Secretary determines are relevant to the value-based 

purchasing program described in paragraph (1). 

(4) REPORT TO CONGRESS.—Not later than October 1, 2011, 

the Secretary shall submit to Congress a report containing 

the plan developed under paragraph (1). 

(b) HOME HEALTH AGENCIES.— 

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

Services (in this section referred to as the ‘‘Secretary’’) shall 

develop a plan to implement a value-based purchasing program 

for payments under the Medicare program under title XVIII 

of the Social Security Act for home health agencies (as defined 

in section 1861(o) of such Act (42 U.S.C. 1395x(o))). 

(2) DETAILS.—In developing the plan under paragraph (1), 

the Secretary shall consider the following issues: 

(A) The ongoing development, selection, and modification process for measures (including under section 1890 

of the Social Security Act (42 U.S.C. 1395aaa) and section 

1890A such Act, as added by section 3014), to the extent 

feasible and practicable, of all dimensions of quality and 

efficiency in home health agencies. 

(B) The reporting, collection, and validation of quality 

data. 

(C) The structure of value-based payment adjustments, 

including the determination of thresholds or improvements 

in quality that would substantiate a payment adjustment, 

the size of such payments, and the sources of funding 

for the value-based bonus payments. 

(D) Methods for the public disclosure of information 

on the performance of home health agencies. 

(E) Any other issues determined appropriate by the 

Secretary. 

(3) CONSULTATION.—In developing the plan under paragraph (1), the Secretary shall— 

(A) consult with relevant affected parties; and 

(B) consider experience with such demonstrations that 

the Secretary determines are relevant to the value-based 

purchasing program described in paragraph (1). 

(4) REPORT TO CONGRESS.—Not later than October 1, 2011, 

the Secretary shall submit to Congress a report containing 

the plan developed under paragraph (1). 

SEC. 3007. VALUE-BASED PAYMENT MODIFIER UNDER THE PHYSICIAN 

FEE SCHEDULE. 

Section 1848 of the Social Security Act (42 U.S.C. 1395w– 

4) is amended— 

(1) in subsection (b)(1), by inserting ‘‘subject to subsection 

(p),’’ after ‘‘1998,’’; and 
H. R. 3590—256 

(2) by adding at the end the following new subsection: 

‘‘(p) ESTABLISHMENT OF VALUE-BASED PAYMENT MODIFIER.— 

‘‘(1) IN GENERAL.—The Secretary shall establish a payment 

modifier that provides for differential payment to a physician 

or a group of physicians under the fee schedule established 

under subsection (b) based upon the quality of care furnished 

compared to cost (as determined under paragraphs (2) and 

(3), respectively) during a performance period. Such payment 

modifier shall be separate from the geographic adjustment factors established under subsection (e). 

‘‘(2) QUALITY.— ‘‘(A) IN GENERAL.—For purposes of paragraph (1), 

quality of care shall be evaluated, to the extent practicable, 

based on a composite of measures of the quality of care 

furnished (as established by the Secretary under subparagraph (B)). 

‘‘(B) MEASURES.— 

‘‘(i) The Secretary shall establish appropriate 

measures of the quality of care furnished by a physician or group of physicians to individuals enrolled 

under this part, such as measures that reflect health 

outcomes. Such measures shall be risk adjusted as 

determined appropriate by the Secretary. 

‘‘(ii) The Secretary shall seek endorsement of the 

measures established under this subparagraph by the 

entity with a contract under section 1890(a). 

‘‘(3) COSTS.—For purposes of paragraph (1), costs shall 

be evaluated, to the extent practicable, based on a composite 

of appropriate measures of costs established by the Secretary 

(such as the composite measure under the methodology established under subsection (n)(9)(C)(iii)) that eliminate the effect 

of geographic adjustments in payment rates (as described in 

subsection (e)), and take into account risk factors (such as 

socioeconomic and demographic characteristics, ethnicity, and 

health status of individuals (such as to recognize that less 

healthy individuals may require more intensive interventions) 

and other factors determined appropriate by the Secretary. 

‘‘(4) IMPLEMENTATION.— ‘‘(A) PUBLICATION OF MEASURES, DATES OF IMPLEMENTA- TION, PERFORMANCE PERIOD.—Not later than January 1, 

2012, the Secretary shall publish the following: 

‘‘(i) The measures of quality of care and costs established under paragraphs (2) and (3), respectively. 

‘‘(ii) The dates for implementation of the payment 

modifier (as determined under subparagraph (B)). 

‘‘(iii) The initial performance period (as specified 

under subparagraph (B)(ii)). 

‘‘(B) DEADLINES FOR IMPLEMENTATION.— ‘‘(i) INITIAL IMPLEMENTATION.—Subject to the preceding provisions of this subparagraph, the Secretary 

shall begin implementing the payment modifier established under this subsection through the rulemaking 

process during 2013 for the physician fee schedule 

established under subsection (b). 

‘‘(ii) INITIAL PERFORMANCE PERIOD.— ‘‘(I) IN GENERAL.—The Secretary shall specify 

an initial performance period for application of 
H. R. 3590—257 

the payment modifier established under this subsection with respect to 2015. 

‘‘(II) PROVISION OF INFORMATION DURING INITIAL PERFORMANCE PERIOD.—During the initial 

performance period, the Secretary shall, to the 

extent practicable, provide information to physicians and groups of physicians about the quality 

of care furnished by the physician or group of 

physicians to individuals enrolled under this part 

compared to cost (as determined under paragraphs 

(2) and (3), respectively) with respect to the 

performance period. 

‘‘(iii) APPLICATION.—The Secretary shall apply the 

payment modifier established under this subsection 

for items and services furnished— 

‘‘(I) beginning on January 1, 2015, with respect 

to specific physicians and groups of physicians the 

Secretary determines appropriate; and 

‘‘(II) beginning not later than January 1, 2017, 

with respect to all physicians and groups of physicians. 

‘‘(C) BUDGET NEUTRALITY.—The payment modifier 

established under this subsection shall be implemented 

in a budget neutral manner. 

‘‘(5) SYSTEMS-BASED CARE.—The Secretary shall, as appropriate, apply the payment modifier established under this subsection in a manner that promotes systems-based care. 

‘‘(6) CONSIDERATION OF SPECIAL CIRCUMSTANCES OF CERTAIN

PROVIDERS.—In applying the payment modifier under this subsection, the Secretary shall, as appropriate, take into account 

the special circumstances of physicians or groups of physicians 

in rural areas and other underserved communities. 

‘‘(7) APPLICATION.—For purposes of the initial application 

of the payment modifier established under this subsection 

during the period beginning on January 1, 2015, and ending 

on December 31, 2016, the term ‘physician’ has the meaning 

given such term in section 1861(r). On or after January 1, 

2017, the Secretary may apply this subsection to eligible professionals (as defined in subsection (k)(3)(B)) as the Secretary 

determines appropriate. 

‘‘(8) DEFINITIONS.—For purposes of this subsection: 

‘‘(A) COSTS.—The term ‘costs’ means expenditures per 

individual as determined appropriate by the Secretary. In 

making the determination under the preceding sentence, 

the Secretary may take into account the amount of growth 

in expenditures per individual for a physician compared 

to the amount of such growth for other physicians. 

‘‘(B) PERFORMANCE PERIOD.—The term ‘performance 

period’ means a period specified by the Secretary. 

‘‘(9) COORDINATION WITH OTHER VALUE-BASED PURCHASING

REFORMS.—The Secretary shall coordinate the value-based payment modifier established under this subsection with the Physician Feedback Program under subsection (n) and, as the Secretary determines appropriate, other similar provisions of this 

title. 
H. R. 3590—258 

‘‘(10) LIMITATIONS ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of— 

‘‘(A) the establishment of the value-based payment 

modifier under this subsection; 

‘‘(B) the evaluation of quality of care under paragraph 

(2), including the establishment of appropriate measures 

of the quality of care under paragraph (2)(B); 

‘‘(C) the evaluation of costs under paragraph (3), 

including the establishment of appropriate measures of 

costs under such paragraph; 

‘‘(D) the dates for implementation of the value-based 

payment modifier; 

‘‘(E) the specification of the initial performance period 

and any other performance period under paragraphs 

(4)(B)(ii) and (8)(B), respectively; 

‘‘(F) the application of the value-based payment modifier under paragraph (7); and 

‘‘(G) the determination of costs under paragraph 

(8)(A).’’. 

SEC. 3008. PAYMENT ADJUSTMENT FOR CONDITIONS ACQUIRED IN 

HOSPITALS. 

(a) IN GENERAL.—Section 1886 of the Social Security Act (42 

U.S.C. 1395ww), as amended by section 3001, is amended by adding 

at the end the following new subsection: 

‘‘(p) ADJUSTMENT TO HOSPITAL PAYMENTS FOR HOSPITAL

ACQUIRED CONDITIONS.— ‘‘(1) IN GENERAL.—In order to provide an incentive for 

applicable hospitals to reduce hospital acquired conditions 

under this title, with respect to discharges from an applicable 

hospital occurring during fiscal year 2015 or a subsequent 

fiscal year, the amount of payment under this section or section 

1814(b)(3), as applicable, for such discharges during the fiscal 

year shall be equal to 99 percent of the amount of payment 

that would otherwise apply to such discharges under this section or section 1814(b)(3) (determined after the application of 

subsections (o) and (q) and section 1814(l)(4) but without regard 

to this subsection). 

‘‘(2) APPLICABLE HOSPITALS.— 

‘‘(A) IN GENERAL.—For purposes of this subsection, the 

term ‘applicable hospital’ means a subsection (d) hospital 

that meets the criteria described in subparagraph (B). 

‘‘(B) CRITERIA DESCRIBED.— 

‘‘(i) IN GENERAL.—The criteria described in this 

subparagraph, with respect to a subsection (d) hospital, 

is that the subsection (d) hospital is in the top quartile 

of all subsection (d) hospitals, relative to the national 

average, of hospital acquired conditions during the 

applicable period, as determined by the Secretary. 

‘‘(ii) RISK ADJUSTMENT.—In carrying out clause (i), 

the Secretary shall establish and apply an appropriate 

risk adjustment methodology. 

‘‘(C) EXEMPTION.—In the case of a hospital that is 

paid under section 1814(b)(3), the Secretary may exempt 

such hospital from the application of this subsection if 

the State which is paid under such section submits an 
H. R. 3590—259 

annual report to the Secretary describing how a similar 

program in the State for a participating hospital or hospitals achieves or surpasses the measured results in terms 

of patient health outcomes and cost savings established 

under this subsection. 

‘‘(3) HOSPITAL ACQUIRED CONDITIONS.—For purposes of this 

subsection, the term ‘hospital acquired condition’ means a condition identified for purposes of subsection (d)(4)(D)(iv) and any 

other condition determined appropriate by the Secretary that 

an individual acquires during a stay in an applicable hospital, 

as determined by the Secretary. 

‘‘(4) APPLICABLE PERIOD.—In this subsection, the term 

‘applicable period’ means, with respect to a fiscal year, a period 

specified by the Secretary. 

‘‘(5) REPORTING TO HOSPITALS.—Prior to fiscal year 2015 

and each subsequent fiscal year, the Secretary shall provide 

confidential reports to applicable hospitals with respect to hospital acquired conditions of the applicable hospital during the 

applicable period. 

‘‘(6) REPORTING HOSPITAL SPECIFIC INFORMATION.— 

‘‘(A) IN GENERAL.—The Secretary shall make information available to the public regarding hospital acquired 

conditions of each applicable hospital. 

‘‘(B) OPPORTUNITY TO REVIEW AND SUBMIT CORRECTIONS.—The Secretary shall ensure that an applicable hospital has the opportunity to review, and submit corrections 

for, the information to be made public with respect to 

the hospital under subparagraph (A) prior to such information being made public. 

‘‘(C) WEBSITE.—Such information shall be posted on 

the Hospital Compare Internet website in an easily understandable format. 

‘‘(7) LIMITATIONS ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of the following: 

‘‘(A) The criteria described in paragraph (2)(A). 

‘‘(B) The specification of hospital acquired conditions 

under paragraph (3). 

‘‘(C) The specification of the applicable period under 

paragraph (4). 

‘‘(D) The provision of reports to applicable hospitals 

under paragraph (5) and the information made available 

to the public under paragraph (6).’’. 

(b) STUDY AND REPORT ON EXPANSION OF HEALTHCARE

ACQUIRED CONDITIONS POLICY TO OTHER PROVIDERS.— 

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

shall conduct a study on expanding the healthcare acquired 

conditions policy under subsection (d)(4)(D) of section 1886 

of the Social Security Act (42 U.S.C. 1395ww) to payments 

made to other facilities under the Medicare program under 

title XVIII of the Social Security Act, including such payments 

made to inpatient rehabilitation facilities, long-term care hospitals (as described in subsection(d)(1)(B)(iv) of such section), 

hospital outpatient departments, and other hospitals excluded 

from the inpatient prospective payment system under such 

section, skilled nursing facilities, ambulatory surgical centers, 

and health clinics. Such study shall include an analysis of 
H. R. 3590—260 

how such policies could impact quality of patient care, patient 

safety, and spending under the Medicare program. 

(2) REPORT.—Not later than January 1, 2012, the Secretary 

shall submit to Congress a report containing the results of 

the study conducted under paragraph (1), together with recommendations for such legislation and administrative action 

as the Secretary determines appropriate. 

PART II—NATIONAL STRATEGY TO IMPROVE 

HEALTH CARE QUALITY 

SEC. 3011. NATIONAL STRATEGY. 

Title III of the Public Health Service Act (42 U.S.C. 241 et 

seq.) is amended by adding at the end the following: 

‘‘PART S—HEALTH CARE QUALITY PROGRAMS 

‘‘Subpart I—National Strategy for Quality 

Improvement in Health Care 

‘‘SEC. 399HH. NATIONAL STRATEGY FOR QUALITY IMPROVEMENT IN 

HEALTH CARE. 

‘‘(a) ESTABLISHMENT OF NATIONAL STRATEGY AND PRIORITIES.— 

‘‘(1) NATIONAL STRATEGY.—The Secretary, through a transparent collaborative process, shall establish a national strategy 

to improve the delivery of health care services, patient health 

outcomes, and population health. 

‘‘(2) IDENTIFICATION OF PRIORITIES.— ‘‘(A) IN GENERAL.—The Secretary shall identify 

national priorities for improvement in developing the 

strategy under paragraph (1). 

‘‘(B) REQUIREMENTS.—The Secretary shall ensure that 

priorities identified under subparagraph (A) will— 

‘‘(i) have the greatest potential for improving the 

health outcomes, efficiency, and patient-centeredness 

of health care for all populations, including children 

and vulnerable populations; 

‘‘(ii) identify areas in the delivery of health care 

services that have the potential for rapid improvement 

in the quality and efficiency of patient care; 

‘‘(iii) address gaps in quality, efficiency, comparative effectiveness information, and health outcomes 

measures and data aggregation techniques; 

‘‘(iv) improve Federal payment policy to emphasize 

quality and efficiency; 

‘‘(v) enhance the use of health care data to improve 

quality, efficiency, transparency, and outcomes; 

‘‘(vi) address the health care provided to patients 

with high-cost chronic diseases; 

‘‘(vii) improve research and dissemination of strategies and best practices to improve patient safety and 

reduce medical errors, preventable admissions and readmissions, and health care-associated infections; 

‘‘(viii) reduce health disparities across health disparity populations (as defined in section 485E) and 

geographic areas; and 
H. R. 3590—261 

‘‘(ix) address other areas as determined appropriate by the Secretary. 

‘‘(C) CONSIDERATIONS.—In identifying priorities under 

subparagraph (A), the Secretary shall take into consideration the recommendations submitted by the entity with 

a contract under section 1890(a) of the Social Security 

Act and other stakeholders. 

‘‘(D) COORDINATION WITH STATE AGENCIES.—The Secretary shall collaborate, coordinate, and consult with State 

agencies responsible for administering the Medicaid program under title XIX of the Social Security Act and the 

Children’s Health Insurance Program under title XXI of 

such Act with respect to developing and disseminating 

strategies, goals, models, and timetables that are consistent 

with the national priorities identified under subparagraph 

(A). 

‘‘(b) STRATEGIC PLAN.— 

‘‘(1) IN GENERAL.—The national strategy shall include a 

comprehensive strategic plan to achieve the priorities described 

in subsection (a). 

‘‘(2) REQUIREMENTS.—The strategic plan shall include 

provisions for addressing, at a minimum, the following: 

‘‘(A) Coordination among agencies within the Department, which shall include steps to minimize duplication 

of efforts and utilization of common quality measures, 

where available. Such common quality measures shall be 

measures identified by the Secretary under section 1139A 

or 1139B of the Social Security Act or endorsed under 

section 1890 of such Act. 

‘‘(B) Agency-specific strategic plans to achieve national 

priorities. 

‘‘(C) Establishment of annual benchmarks for each relevant agency to achieve national priorities. 

‘‘(D) A process for regular reporting by the agencies 

to the Secretary on the implementation of the strategic 

plan. 

‘‘(E) Strategies to align public and private payers with 

regard to quality and patient safety efforts. 

‘‘(F) Incorporating quality improvement and measurement in the strategic plan for health information technology 

required by the American Recovery and Reinvestment Act 

of 2009 (Public Law 111–5). 

‘‘(c) PERIODIC UPDATE OF NATIONAL STRATEGY.—The Secretary 

shall update the national strategy not less than annually. Any 

such update shall include a review of short- and long-term goals. 

‘‘(d) SUBMISSION AND AVAILABILITY OF NATIONAL STRATEGY AND

UPDATES.— 

‘‘(1) DEADLINE FOR INITIAL SUBMISSION OF NATIONAL

STRATEGY.—Not later than January 1, 2011, the Secretary shall 

submit to the relevant committees of Congress the national 

strategy described in subsection (a). 

‘‘(2) UPDATES.— ‘‘(A) IN GENERAL.—The Secretary shall submit to the 

relevant committees of Congress an annual update to the 

strategy described in paragraph (1). 

‘‘(B) INFORMATION SUBMITTED.—Each update submitted 

under subparagraph (A) shall include— 
H. R. 3590—262 

‘‘(i) a review of the short- and long-term goals 

of the national strategy and any gaps in such strategy; 

‘‘(ii) an analysis of the progress, or lack of progress, 

in meeting such goals and any barriers to such 

progress; 

‘‘(iii) the information reported under section 1139A 

of the Social Security Act, consistent with the reporting 

requirements of such section; and 

‘‘(iv) in the case of an update required to be submitted on or after January 1, 2014, the information 

reported under section 1139B(b)(4) of the Social Security Act, consistent with the reporting requirements 

of such section. 

‘‘(C) SATISFACTION OF OTHER REPORTING REQUIREMENTS.—Compliance with the requirements of clauses (iii) 

and (iv) of subparagraph (B) shall satisfy the reporting 

requirements under sections 1139A(a)(6) and 1139B(b)(4), 

respectively, of the Social Security Act. 

‘‘(e) HEALTH CARE QUALITY INTERNET WEBSITE.—Not later than 

January 1, 2011, the Secretary shall create an Internet website 

to make public information regarding— 

‘‘(1) the national priorities for health care quality improvement established under subsection (a)(2); 

‘‘(2) the agency-specific strategic plans for health care 

quality described in subsection (b)(2)(B); and 

‘‘(3) other information, as the Secretary determines to be 

appropriate.’’. 

SEC. 3012. INTERAGENCY WORKING GROUP ON HEALTH CARE 

QUALITY. 

(a) IN GENERAL.—The President shall convene a working group 

to be known as the Interagency Working Group on Health Care 

Quality (referred to in this section as the ‘‘Working Group’’). 

(b) GOALS.—The goals of the Working Group shall be to achieve 

the following: 

(1) Collaboration, cooperation, and consultation between 

Federal departments and agencies with respect to developing 

and disseminating strategies, goals, models, and timetables 

that are consistent with the national priorities identified under 

section 399HH(a)(2) of the Public Health Service Act (as added 

by section 3011). 

(2) Avoidance of inefficient duplication of quality improvement efforts and resources, where practicable, and a streamlined process for quality reporting and compliance requirements. 

(3) Assess alignment of quality efforts in the public sector 

with private sector initiatives. 

(c) COMPOSITION.— (1) IN GENERAL.—The Working Group shall be composed 

of senior level representatives of— 

(A) the Department of Health and Human Services; 

(B) the Centers for Medicare & Medicaid Services; 

(C) the National Institutes of Health; 

(D) the Centers for Disease Control and Prevention; 

(E) the Food and Drug Administration; 

(F) the Health Resources and Services Administration; 

(G) the Agency for Healthcare Research and Quality; 
H. R. 3590—263 

(H) the Office of the National Coordinator for Health 

Information Technology; 

(I) the Substance Abuse and Mental Health Services 

Administration; 

(J) the Administration for Children and Families; 

(K) the Department of Commerce; 

(L) the Office of Management and Budget; 

(M) the United States Coast Guard; 

(N) the Federal Bureau of Prisons; 

(O) the National Highway Traffic Safety Administration; 

(P) the Federal Trade Commission; 

(Q) the Social Security Administration; 

(R) the Department of Labor; 

(S) the United States Office of Personnel Management; 

(T) the Department of Defense; 

(U) the Department of Education; 

(V) the Department of Veterans Affairs; 

(W) the Veterans Health Administration; and 

(X) any other Federal agencies and departments with 

activities relating to improving health care quality and 

safety, as determined by the President. 

(2) CHAIR AND VICE-CHAIR.— 

(A) CHAIR.—The Working Group shall be chaired by 

the Secretary of Health and Human Services. 

(B) VICE CHAIR.—Members of the Working Group, other 

than the Secretary of Health and Human Services, shall 

serve as Vice Chair of the Group on a rotating basis, 

as determined by the Group. 

(d) REPORT TO CONGRESS.—Not later than December 31, 2010, 

and annually thereafter, the Working Group shall submit to the 

relevant Committees of Congress, and make public on an Internet 

website, a report describing the progress and recommendations 

of the Working Group in meeting the goals described in subsection 

(b). 

SEC. 3013. QUALITY MEASURE DEVELOPMENT. 

(a) PUBLIC HEALTH SERVICE ACT.—Title IX of the Public Health 

Service Act (42 U.S.C. 299 et seq.) is amended— 

(1) by redesignating part D as part E; 

(2) by redesignating sections 931 through 938 as sections 

941 through 948, respectively; 

(3) in section 948(1), as so redesignated, by striking ‘‘931’’ 

and inserting ‘‘941’’; and 

(4) by inserting after section 926 the following: 

‘‘PART D—HEALTH CARE QUALITY 

IMPROVEMENT 

‘‘Subpart I—Quality Measure Development 

‘‘SEC. 931. QUALITY MEASURE DEVELOPMENT. 

‘‘(a) QUALITY MEASURE.—In this subpart, the term ‘quality 

measure’ means a standard for measuring the performance and 

improvement of population health or of health plans, providers 

of services, and other clinicians in the delivery of health care 

services. 
H. R. 3590—264 

‘‘(b) IDENTIFICATION OF QUALITY MEASURES.— 

‘‘(1) IDENTIFICATION.—The Secretary, in consultation with 

the Director of the Agency for Healthcare Research and Quality 

and the Administrator of the Centers for Medicare & Medicaid 

Services, shall identify, not less often than triennially, gaps 

where no quality measures exist and existing quality measures 

that need improvement, updating, or expansion, consistent with 

the national strategy under section 399HH, to the extent available, for use in Federal health programs. In identifying such 

gaps and existing quality measures that need improvement, 

the Secretary shall take into consideration— 

‘‘(A) the gaps identified by the entity with a contract 

under section 1890(a) of the Social Security Act and other 

stakeholders; 

‘‘(B) quality measures identified by the pediatric 

quality measures program under section 1139A of the 

Social Security Act; and 

‘‘(C) quality measures identified through the Medicaid 

Quality Measurement Program under section 1139B of the 

Social Security Act. 

‘‘(2) PUBLICATION.—The Secretary shall make available to 

the public on an Internet website a report on any gaps identified 

under paragraph (1) and the process used to make such identification. 

‘‘(c) GRANTS OR CONTRACTS FOR QUALITY MEASURE DEVELOPMENT.— 

‘‘(1) IN GENERAL.—The Secretary shall award grants, contracts, or intergovernmental agreements to eligible entities for 

purposes of developing, improving, updating, or expanding 

quality measures identified under subsection (b). 

‘‘(2) PRIORITIZATION IN THE DEVELOPMENT OF QUALITY MEASURES.—In awarding grants, contracts, or agreements under 

this subsection, the Secretary shall give priority to the development of quality measures that allow the assessment of— 

‘‘(A) health outcomes and functional status of patients; 

‘‘(B) the management and coordination of health care 

across episodes of care and care transitions for patients 

across the continuum of providers, health care settings, 

and health plans; 

‘‘(C) the experience, quality, and use of information 

provided to and used by patients, caregivers, and authorized representatives to inform decisionmaking about treatment options, including the use of shared decisionmaking 

tools and preference sensitive care (as defined in section 

936); 

‘‘(D) the meaningful use of health information technology; 

‘‘(E) the safety, effectiveness, patient-centeredness, 

appropriateness, and timeliness of care; 

‘‘(F) the efficiency of care; 

‘‘(G) the equity of health services and health disparities 

across health disparity populations (as defined in section 

485E) and geographic areas; 

‘‘(H) patient experience and satisfaction; 

‘‘(I) the use of innovative strategies and methodologies 

identified under section 933; and 
H. R. 3590—265 

‘‘(J) other areas determined appropriate by the Secretary. 

‘‘(3) ELIGIBLE ENTITIES.—To be eligible for a grant or contract under this subsection, an entity shall— 

‘‘(A) have demonstrated expertise and capacity in the 

development and evaluation of quality measures; 

‘‘(B) have adopted procedures to include in the quality 

measure development process— 

‘‘(i) the views of those providers or payers whose 

performance will be assessed by the measure; and 

‘‘(ii) the views of other parties who also will use 

the quality measures (such as patients, consumers, 

and health care purchasers); 

‘‘(C) collaborate with the entity with a contract under 

section 1890(a) of the Social Security Act and other stakeholders, as practicable, and the Secretary so that quality 

measures developed by the eligible entity will meet the 

requirements to be considered for endorsement by the 

entity with a contract under such section 1890(a); 

‘‘(D) have transparent policies regarding governance 

and conflicts of interest; and 

‘‘(E) submit an application to the Secretary at such 

time and in such manner, as the Secretary may require. 

‘‘(4) USE OF FUNDS.—An entity that receives a grant, contract, or agreement under this subsection shall use such award 

to develop quality measures that meet the following requirements: 

‘‘(A) Such measures support measures required to be 

reported under the Social Security Act, where applicable, 

and in support of gaps and existing quality measures that 

need improvement, as described in subsection (b)(1)(A). 

‘‘(B) Such measures support measures developed under 

section 1139A of the Social Security Act and the Medicaid 

Quality Measurement Program under section 1139B of such 

Act, where applicable. 

‘‘(C) To the extent practicable, data on such quality 

measures is able to be collected using health information 

technologies. 

‘‘(D) Each quality measure is free of charge to users 

of such measure. 

‘‘(E) Each quality measure is publicly available on an 

Internet website. 

‘‘(d) OTHER ACTIVITIES BY THE SECRETARY.—The Secretary may 

use amounts available under this section to update and test, where 

applicable, quality measures endorsed by the entity with a contract 

under section 1890(a) of the Social Security Act or adopted by 

the Secretary. 

‘‘(e) COORDINATION OF GRANTS.—The Secretary shall ensure 

that grants or contracts awarded under this section are coordinated 

with grants and contracts awarded under sections 1139A(5) and 

1139B(4)(A) of the Social Security Act.’’. 

(b) SOCIAL SECURITY ACT.—Section 1890A of the Social Security 

Act, as added by section 3014(b), is amended by adding at the 

end the following new subsection: 

‘‘(e) DEVELOPMENT OF QUALITY MEASURES.—The Administrator 

of the Center for Medicare & Medicaid Services shall through 

contracts develop quality measures (as determined appropriate by 
H. R. 3590—266 

the Administrator) for use under this Act. In developing such measures, the Administrator shall consult with the Director of the 

Agency for Healthcare Research and Quality.’’. 

(c) FUNDING.—There are authorized to be appropriated to the 

Secretary of Health and Human Services to carry out this section, 

$75,000,000 for each of fiscal years 2010 through 2014. Of the 

amounts appropriated under the preceding sentence in a fiscal 

year, not less than 50 percent of such amounts shall be used 

pursuant to subsection (e) of section 1890A of the Social Security 

Act, as added by subsection (b), with respect to programs under 

such Act. Amounts appropriated under this subsection for a fiscal 

year shall remain available until expended. 

SEC. 3014. QUALITY MEASUREMENT. 

(a) NEW DUTIES FOR CONSENSUS-BASED ENTITY.— 

(1) MULTI-STAKEHOLDER GROUP INPUT.—Section 1890(b) of 

the Social Security Act (42 U.S.C. 1395aaa(b)), as amended 

by section 3003, is amended by adding at the end the following 

new paragraphs: 

‘‘(7) CONVENING MULTI-STAKEHOLDER GROUPS.— 

‘‘(A) IN GENERAL.—The entity shall convene multistakeholder groups to provide input on— 

‘‘(i) the selection of quality measures described in 

subparagraph (B), from among— 

‘‘(I) such measures that have been endorsed 

by the entity; and 

‘‘(II) such measures that have not been considered for endorsement by such entity but are used 

or proposed to be used by the Secretary for the 

collection or reporting of quality measures; and 

‘‘(ii) national priorities (as identified under section 

399HH of the Public Health Service Act) for improvement in population health and in the delivery of health 

care services for consideration under the national 

strategy established under section 399HH of the Public 

Health Service Act. 

‘‘(B) QUALITY MEASURES.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the quality 

measures described in this subparagraph are quality 

measures— 

‘‘(I) for use pursuant to sections 1814(i)(5)(D), 

1833(i)(7), 1833(t)(17), 1848(k)(2)(C), 1866(k)(3), 

1881(h)(2)(A)(iii), 1886(b)(3)(B)(viii), 1886(j)(7)(D), 

1886(m)(5)(D), 1886(o)(2), and 1895(b)(3)(B)(v); 

‘‘(II) for use in reporting performance information to the public; and 

‘‘(III) for use in health care programs other 

than for use under this Act. 

‘‘(ii) EXCLUSION.—Data sets (such as the outcome 

and assessment information set for home health services and the minimum data set for skilled nursing 

facility services) that are used for purposes of classification systems used in establishing payment rates under 

this title shall not be quality measures described in 

this subparagraph. 

‘‘(C) REQUIREMENT FOR TRANSPARENCY IN PROCESS.— 
H. R. 3590—267 

‘‘(i) IN GENERAL.—In convening multi-stakeholder 

groups under subparagraph (A) with respect to the 

selection of quality measures, the entity shall provide 

for an open and transparent process for the activities 

conducted pursuant to such convening. 

‘‘(ii) SELECTION OF ORGANIZATIONS PARTICIPATING

IN MULTI-STAKEHOLDER GROUPS.—The process 

described in clause (i) shall ensure that the selection 

of representatives comprising such groups provides for 

public nominations for, and the opportunity for public 

comment on, such selection. 

‘‘(D) MULTI-STAKEHOLDER GROUP DEFINED.—In this 

paragraph, the term ‘multi-stakeholder group’ means, with 

respect to a quality measure, a voluntary collaborative 

of organizations representing a broad group of stakeholders 

interested in or affected by the use of such quality measure. 

‘‘(8) TRANSMISSION OF MULTI-STAKEHOLDER INPUT.—Not 

later than February 1 of each year (beginning with 2012), 

the entity shall transmit to the Secretary the input of multistakeholder groups provided under paragraph (7).’’. 

(2) ANNUAL REPORT.—Section 1890(b)(5)(A) of the Social 

Security Act (42 U.S.C. 1395aaa(b)(5)(A)) is amended— 

(A) in clause (ii), by striking ‘‘and’’ at the end; 

(B) in clause (iii), by striking the period at the end 

and inserting a semicolon; and 

(C) by adding at the end the following new clauses: 

‘‘(iv) gaps in endorsed quality measures, which 

shall include measures that are within priority areas 

identified by the Secretary under the national strategy 

established under section 399HH of the Public Health 

Service Act, and where quality measures are unavailable or inadequate to identify or address such gaps; 

‘‘(v) areas in which evidence is insufficient to support endorsement of quality measures in priority areas 

identified by the Secretary under the national strategy 

established under section 399HH of the Public Health 

Service Act and where targeted research may address 

such gaps; and 

‘‘(vi) the matters described in clauses (i) and (ii) 

of paragraph (7)(A).’’. 

(b) MULTI-STAKEHOLDER GROUP INPUT INTO SELECTION OF

QUALITY MEASURES.—Title XVIII of the Social Security Act (42 

U.S.C. 1395 et seq.) is amended by inserting after section 1890 

the following: 

‘‘QUALITY MEASUREMENT

‘‘SEC. 1890A. (a) MULTI-STAKEHOLDER GROUP INPUT INTO

SELECTION OF QUALITY MEASURES.—The Secretary shall establish 

a pre-rulemaking process under which the following steps occur 

with respect to the selection of quality measures described in section 

1890(b)(7)(B): 

‘‘(1) INPUT.—Pursuant to section 1890(b)(7), the entity with 

a contract under section 1890 shall convene multi-stakeholder 

groups to provide input to the Secretary on the selection of 

quality measures described in subparagraph (B) of such paragraph. 
H. R. 3590—268 

‘‘(2) PUBLIC AVAILABILITY OF MEASURES CONSIDERED FOR

SELECTION.—Not later than December 1 of each year (beginning 

with 2011), the Secretary shall make available to the public 

a list of quality measures described in section 1890(b)(7)(B) 

that the Secretary is considering under this title. 

‘‘(3) TRANSMISSION OF MULTI-STAKEHOLDER INPUT.—Pursuant to section 1890(b)(8), not later than February 1 of each 

year (beginning with 2012), the entity shall transmit to the 

Secretary the input of multi-stakeholder groups described in 

paragraph (1). 

‘‘(4) CONSIDERATION OF MULTI-STAKEHOLDER INPUT.—The 

Secretary shall take into consideration the input from multistakeholder groups described in paragraph (1) in selecting 

quality measures described in section 1890(b)(7)(B) that have 

been endorsed by the entity with a contract under section 

1890 and measures that have not been endorsed by such entity. 

‘‘(5) RATIONALE FOR USE OF QUALITY MEASURES.—The Secretary shall publish in the Federal Register the rationale for 

the use of any quality measure described in section 

1890(b)(7)(B) that has not been endorsed by the entity with 

a contract under section 1890. 

‘‘(6) ASSESSMENT OF IMPACT.—Not later than March 1, 

2012, and at least once every three years thereafter, the Secretary shall— 

‘‘(A) conduct an assessment of the quality impact of 

the use of endorsed measures described in section 

1890(b)(7)(B); and 

‘‘(B) make such assessment available to the public. 

‘‘(b) PROCESS FOR DISSEMINATION OF MEASURES USED BY THE

SECRETARY.— 

‘‘(1) IN GENERAL.—The Secretary shall establish a process 

for disseminating quality measures used by the Secretary. Such 

process shall include the following: 

‘‘(A) The incorporation of such measures, where 

applicable, in workforce programs, training curricula, and 

any other means of dissemination determined appropriate 

by the Secretary. 

‘‘(B) The dissemination of such quality measures 

through the national strategy developed under section 

399HH of the Public Health Service Act. 

‘‘(2) EXISTING METHODS.—To the extent practicable, the 

Secretary shall utilize and expand existing dissemination 

methods in disseminating quality measures under the process 

established under paragraph (1). 

‘‘(c) REVIEW OF QUALITY MEASURES USED BY THE SECRETARY.— 

‘‘(1) IN GENERAL.—The Secretary shall— 

‘‘(A) periodically (but in no case less often than once 

every 3 years) review quality measures described in section 

1890(b)(7)(B); and 

‘‘(B) with respect to each such measure, determine 

whether to— 

‘‘(i) maintain the use of such measure; or 

‘‘(ii) phase out such measure. 

‘‘(2) CONSIDERATIONS.—In conducting the review under 

paragraph (1), the Secretary shall take steps to— 

‘‘(A) seek to avoid duplication of measures used; and 
H. R. 3590—269 

‘‘(B) take into consideration current innovative methodologies and strategies for quality improvement practices 

in the delivery of health care services that represent best 

practices for such quality improvement and measures 

endorsed by the entity with a contract under section 1890 

since the previous review by the Secretary. 

‘‘(d) RULE OF CONSTRUCTION.—Nothing in this section shall 

preclude a State from using the quality measures identified under 

sections 1139A and 1139B.’’. 

(c) FUNDING.—For purposes of carrying out the amendments 

made by this section, the Secretary shall provide for the transfer, 

from the Federal Hospital Insurance Trust Fund under section 

1817 of the Social Security Act (42 U.S.C. 1395i) and the Federal 

Supplementary Medical Insurance Trust Fund under section 1841 

of such Act (42 U.S.C. 1395t), in such proportion as the Secretary 

determines appropriate, of $20,000,000, to the Centers for Medicare 

& Medicaid Services Program Management Account for each of 

fiscal years 2010 through 2014. Amounts transferred under the 

preceding sentence shall remain available until expended. 

SEC. 3015. DATA COLLECTION; PUBLIC REPORTING. 

Title III of the Public Health Service Act (42 U.S.C. 241 et 

seq.), as amended by section 3011, is further amended by adding 

at the end the following: 

‘‘SEC. 399II. COLLECTION AND ANALYSIS OF DATA FOR QUALITY AND 

RESOURCE USE MEASURES. 

‘‘(a) IN GENERAL.—The Secretary shall collect and aggregate 

consistent data on quality and resource use measures from information systems used to support health care delivery to implement 

the public reporting of performance information, as described in 

section 399JJ, and may award grants or contracts for this purpose. 

The Secretary shall ensure that such collection, aggregation, and 

analysis systems span an increasingly broad range of patient populations, providers, and geographic areas over time. 

‘‘(b) GRANTS OR CONTRACTS FOR DATA COLLECTION.— ‘‘(1) IN GENERAL.—The Secretary may award grants or contracts to eligible entities to support new, or improve existing, 

efforts to collect and aggregate quality and resource use measures described under subsection (c). 

‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a grant or contract under this subsection, an entity shall— 

‘‘(A) be— 

‘‘(i) a multi-stakeholder entity that coordinates the 

development of methods and implementation plans for 

the consistent reporting of summary quality and cost 

information; 

‘‘(ii) an entity capable of submitting such summary 

data for a particular population and providers, such 

as a disease registry, regional collaboration, health 

plan collaboration, or other population-wide source; or 

‘‘(iii) a Federal Indian Health Service program or 

a health program operated by an Indian tribe (as 

defined in section 4 of the Indian Health Care Improvement Act); 

‘‘(B) promote the use of the systems that provide data 

to improve and coordinate patient care; 
H. R. 3590—270 

‘‘(C) support the provision of timely, consistent quality 

and resource use information to health care providers, and 

other groups and organizations as appropriate, with an 

opportunity for providers to correct inaccurate measures; 

and 

‘‘(D) agree to report, as determined by the Secretary, 

measures on quality and resource use to the public in 

accordance with the public reporting process established 

under section 399JJ. 

‘‘(c) CONSISTENT DATA AGGREGATION.—The Secretary may 

award grants or contracts under this section only to entities that 

enable summary data that can be integrated and compared across 

multiple sources. The Secretary shall provide standards for the 

protection of the security and privacy of patient data. 

‘‘(d) MATCHING FUNDS.—The Secretary may not award a grant 

or contract under this section to an entity unless the entity agrees 

that it will make available (directly or through contributions from 

other public or private entities) non-Federal contributions toward 

the activities to be carried out under the grant or contract in 

an amount equal to $1 for each $5 of Federal funds provided 

under the grant or contract. Such non-Federal matching funds 

may be provided directly or through donations from public or private 

entities and may be in cash or in-kind, fairly evaluated, including 

plant, equipment, or services. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—To carry out this section, there are authorized to be appropriated such sums as may 

be necessary for fiscal years 2010 through 2014. 

‘‘SEC. 399JJ. PUBLIC REPORTING OF PERFORMANCE INFORMATION. 

‘‘(a) DEVELOPMENT OF PERFORMANCE WEBSITES.—The Secretary 

shall make available to the public, through standardized Internet 

websites, performance information summarizing data on quality 

measures. Such information shall be tailored to respond to the 

differing needs of hospitals and other institutional health care providers, physicians and other clinicians, patients, consumers, 

researchers, policymakers, States, and other stakeholders, as the 

Secretary may specify. 

‘‘(b) INFORMATION ON CONDITIONS.—The performance information made publicly available on an Internet website, as described 

in subsection (a), shall include information regarding clinical conditions to the extent such information is available, and the information shall, where appropriate, be provider-specific and sufficiently 

disaggregated and specific to meet the needs of patients with different clinical conditions. 

‘‘(c) CONSULTATION.— 

‘‘(1) IN GENERAL.—In carrying out this section, the Secretary shall consult with the entity with a contract under 

section 1890(a) of the Social Security Act, and other entities, 

as appropriate, to determine the type of information that is 

useful to stakeholders and the format that best facilitates use 

of the reports and of performance reporting Internet websites. 

‘‘(2) CONSULTATION WITH STAKEHOLDERS.—The entity with 

a contract under section 1890(a) of the Social Security Act 

shall convene multi-stakeholder groups, as described in such 

section, to review the design and format of each Internet 

website made available under subsection (a) and shall transmit 
H. R. 3590—271 

to the Secretary the views of such multi-stakeholder groups 

with respect to each such design and format. 

‘‘(d) COORDINATION.—Where appropriate, the Secretary shall 

coordinate the manner in which data are presented through Internet 

websites described in subsection (a) and for public reporting of 

other quality measures by the Secretary, including such quality 

measures under title XVIII of the Social Security Act. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—To carry out this section, there are authorized to be appropriated such sums as may 

be necessary for fiscal years 2010 through 2014.’’. 

PART III—ENCOURAGING DEVELOPMENT OF 

NEW PATIENT CARE MODELS 

SEC. 3021. ESTABLISHMENT OF CENTER FOR MEDICARE AND MEDICAID INNOVATION WITHIN CMS. 

(a) IN GENERAL.—Title XI of the Social Security Act is amended 

by inserting after section 1115 the following new section: 

‘‘CENTER FOR MEDICARE AND MEDICAID INNOVATION

‘‘SEC. 1115A. (a) CENTER FOR MEDICARE AND MEDICAID INNOVA- TION ESTABLISHED.— ‘‘(1) IN GENERAL.—There is created within the Centers for 

Medicare & Medicaid Services a Center for Medicare and Medicaid Innovation (in this section referred to as the ‘CMI’) to 

carry out the duties described in this section. The purpose 

of the CMI is to test innovative payment and service delivery 

models to reduce program expenditures under the applicable 

titles while preserving or enhancing the quality of care furnished to individuals under such titles. In selecting such 

models, the Secretary shall give preference to models that 

also improve the coordination, quality, and efficiency of health 

care services furnished to applicable individuals defined in 

paragraph (4)(A). 

‘‘(2) DEADLINE.—The Secretary shall ensure that the CMI 

is carrying out the duties described in this section by not 

later than January 1, 2011. 

‘‘(3) CONSULTATION.—In carrying out the duties under this 

section, the CMI shall consult representatives of relevant Federal agencies, and clinical and analytical experts with expertise 

in medicine and health care management. The CMI shall use 

open door forums or other mechanisms to seek input from 

interested parties. 

‘‘(4) DEFINITIONS.—In this section: 

‘‘(A) APPLICABLE INDIVIDUAL.—The term ‘applicable 

individual’ means— 

‘‘(i) an individual who is entitled to, or enrolled 

for, benefits under part A of title XVIII or enrolled 

for benefits under part B of such title; 

‘‘(ii) an individual who is eligible for medical assistance under title XIX, under a State plan or waiver; 

or 

‘‘(iii) an individual who meets the criteria of both 

clauses (i) and (ii). 

‘‘(B) APPLICABLE TITLE.—The term ‘applicable title’ 

means title XVIII, title XIX, or both. 
H. R. 3590—272 

‘‘(b) TESTING OF MODELS (PHASE I).— 

‘‘(1) IN GENERAL.—The CMI shall test payment and service 

delivery models in accordance with selection criteria under 

paragraph (2) to determine the effect of applying such models 

under the applicable title (as defined in subsection (a)(4)(B)) 

on program expenditures under such titles and the quality 

of care received by individuals receiving benefits under such 

title. 

‘‘(2) SELECTION OF MODELS TO BE TESTED.— 

‘‘(A) IN GENERAL.—The Secretary shall select models 

to be tested from models where the Secretary determines 

that there is evidence that the model addresses a defined 

population for which there are deficits in care leading 

to poor clinical outcomes or potentially avoidable expenditures. The models selected under the preceding sentence 

may include the models described in subparagraph (B). 

‘‘(B) OPPORTUNITIES.—The models described in this 

subparagraph are the following models: 

‘‘(i) Promoting broad payment and practice reform 

in primary care, including patient-centered medical 

home models for high-need applicable individuals, medical homes that address women’s unique health care 

needs, and models that transition primary care practices away from fee-for-service based reimbursement 

and toward comprehensive payment or salary-based 

payment. 

‘‘(ii) Contracting directly with groups of providers 

of services and suppliers to promote innovative care 

delivery models, such as through risk-based comprehensive payment or salary-based payment. 

‘‘(iii) Utilizing geriatric assessments and comprehensive care plans to coordinate the care (including 

through interdisciplinary teams) of applicable individuals with multiple chronic conditions and at least one 

of the following: 

‘‘(I) An inability to perform 2 or more activities 

of daily living. 

‘‘(II) Cognitive impairment, including 

dementia. 

‘‘(iv) Promote care coordination between providers 

of services and suppliers that transition health care 

providers away from fee-for-service based reimbursement and toward salary-based payment. 

‘‘(v) Supporting care coordination for chronicallyill applicable individuals at high risk of hospitalization 

through a health information technology-enabled provider network that includes care coordinators, a chronic 

disease registry, and home tele-health technology. 

‘‘(vi) Varying payment to physicians who order 

advanced diagnostic imaging services (as defined in 

section 1834(e)(1)(B)) according to the physician’s 

adherence to appropriateness criteria for the ordering 

of such services, as determined in consultation with 

physician specialty groups and other relevant stakeholders. 
H. R. 3590—273 

‘‘(vii) Utilizing medication therapy management 

services, such as those described in section 935 of 

the Public Health Service Act. 

‘‘(viii) Establishing community-based health teams 

to support small-practice medical homes by assisting 

the primary care practitioner in chronic care management, including patient self-management, activities. 

‘‘(ix) Assisting applicable individuals in making 

informed health care choices by paying providers of 

services and suppliers for using patient decision-support tools, including tools that meet the standards 

developed and identified under section 936(c)(2)(A) of 

the Public Health Service Act, that improve applicable 

individual and caregiver understanding of medical 

treatment options. 

‘‘(x) Allowing States to test and evaluate fully integrating care for dual eligible individuals in the State, 

including the management and oversight of all funds 

under the applicable titles with respect to such individuals. 

‘‘(xi) Allowing States to test and evaluate systems 

of all-payer payment reform for the medical care of 

residents of the State, including dual eligible individuals. 

‘‘(xii) Aligning nationally recognized, evidencebased guidelines of cancer care with payment incentives under title XVIII in the areas of treatment planning and follow-up care planning for applicable individuals described in clause (i) or (iii) of subsection (a)(4)(A) 

with cancer, including the identification of gaps in 

applicable quality measures. 

‘‘(xiii) Improving post-acute care through continuing care hospitals that offer inpatient rehabilitation, long-term care hospitals, and home health or 

skilled nursing care during an inpatient stay and the 

30 days immediately following discharge. 

‘‘(xiv) Funding home health providers who offer 

chronic care management services to applicable 

individuals in cooperation with interdisciplinary teams. 

‘‘(xv) Promoting improved quality and reduced cost 

by developing a collaborative of high-quality, low-cost 

health care institutions that is responsible for— 

‘‘(I) developing, documenting, and disseminating best practices and proven care methods; 

‘‘(II) implementing such best practices and 

proven care methods within such institutions to 

demonstrate further improvements in quality and 

efficiency; and 

‘‘(III) providing assistance to other health care 

institutions on how best to employ such best practices and proven care methods to improve health 

care quality and lower costs. 

‘‘(xvi) Facilitate inpatient care, including intensive 

care, of hospitalized applicable individuals at their local 

hospital through the use of electronic monitoring by 

specialists, including intensivists and critical care 

specialists, based at integrated health systems. 
H. R. 3590—274 

‘‘(xvii) Promoting greater efficiencies and timely 

access to outpatient services (such as outpatient physical therapy services) through models that do not 

require a physician or other health professional to 

refer the service or be involved in establishing the 

plan of care for the service, when such service is furnished by a health professional who has the authority 

to furnish the service under existing State law. 

‘‘(xviii) Establishing comprehensive payments to 

Healthcare Innovation Zones, consisting of groups of 

providers that include a teaching hospital, physicians, 

and other clinical entities, that, through their structure, operations, and joint-activity deliver a full spectrum of integrated and comprehensive health care services to applicable individuals while also incorporating 

innovative methods for the clinical training of future 

health care professionals. 

‘‘(C) ADDITIONAL FACTORS FOR CONSIDERATION.—In 

selecting models for testing under subparagraph (A), the 

CMI may consider the following additional factors: 

‘‘(i) Whether the model includes a regular process 

for monitoring and updating patient care plans in a 

manner that is consistent with the needs and preferences of applicable individuals. 

‘‘(ii) Whether the model places the applicable individual, including family members and other informal 

caregivers of the applicable individual, at the center 

of the care team of the applicable individual. 

‘‘(iii) Whether the model provides for in-person 

contact with applicable individuals. 

‘‘(iv) Whether the model utilizes technology, such 

as electronic health records and patient-based remote 

monitoring systems, to coordinate care over time and 

across settings. 

‘‘(v) Whether the model provides for the maintenance of a close relationship between care coordinators, 

primary care practitioners, specialist physicians, 

community-based organizations, and other providers 

of services and suppliers. 

‘‘(vi) Whether the model relies on a team-based 

approach to interventions, such as comprehensive care 

assessments, care planning, and self-management 

coaching. 

‘‘(vii) Whether, under the model, providers of services and suppliers are able to share information with 

patients, caregivers, and other providers of services 

and suppliers on a real time basis. 

‘‘(3) BUDGET NEUTRALITY.— ‘‘(A) INITIAL PERIOD.—The Secretary shall not require, 

as a condition for testing a model under paragraph (1), 

that the design of such model ensure that such model 

is budget neutral initially with respect to expenditures 

under the applicable title. 

‘‘(B) TERMINATION OR MODIFICATION.—The Secretary 

shall terminate or modify the design and implementation 

of a model unless the Secretary determines (and the Chief 

Actuary of the Centers for Medicare & Medicaid Services, 
H. R. 3590—275 

with respect to program spending under the applicable 

title, certifies), after testing has begun, that the model 

is expected to— 

‘‘(i) improve the quality of care (as determined 

by the Administrator of the Centers for Medicare & 

Medicaid Services) without increasing spending under 

the applicable title; 

‘‘(ii) reduce spending under the applicable title 

without reducing the quality of care; or 

‘‘(iii) improve the quality of care and reduce 

spending. 

Such termination may occur at any time after such testing 

has begun and before completion of the testing. 

‘‘(4) EVALUATION.— 

‘‘(A) IN GENERAL.—The Secretary shall conduct an 

evaluation of each model tested under this subsection. Such 

evaluation shall include an analysis of— 

‘‘(i) the quality of care furnished under the model, 

including the measurement of patient-level outcomes 

and patient-centeredness criteria determined appropriate by the Secretary; and 

‘‘(ii) the changes in spending under the applicable 

titles by reason of the model. 

‘‘(B) INFORMATION.—The Secretary shall make the 

results of each evaluation under this paragraph available 

to the public in a timely fashion and may establish requirements for States and other entities participating in the 

testing of models under this section to collect and report 

information that the Secretary determines is necessary to 

monitor and evaluate such models. 

‘‘(c) EXPANSION OF MODELS (PHASE II).—Taking into account 

the evaluation under subsection (b)(4), the Secretary may, through 

rulemaking, expand (including implementation on a nationwide 

basis) the duration and the scope of a model that is being tested 

under subsection (b) or a demonstration project under section 

1866C, to the extent determined appropriate by the Secretary, 

if— 

‘‘(1) the Secretary determines that such expansion is 

expected to— 

‘‘(A) reduce spending under applicable title without 

reducing the quality of care; or 

‘‘(B) improve the quality of care and reduce spending; 

and 

‘‘(2) the Chief Actuary of the Centers for Medicare & Medicaid Services certifies that such expansion would reduce program spending under applicable titles. 

‘‘(d) IMPLEMENTATION.— ‘‘(1) WAIVER AUTHORITY.—The Secretary may waive such 

requirements of titles XI and XVIII and of sections 1902(a)(1), 

1902(a)(13), and 1903(m)(2)(A)(iii) as may be necessary solely 

for purposes of carrying out this section with respect to testing 

models described in subsection (b). 

‘‘(2) LIMITATIONS ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of— 

‘‘(A) the selection of models for testing or expansion 

under this section; 
H. R. 3590—276 

‘‘(B) the selection of organizations, sites, or participants 

to test those models selected; 

‘‘(C) the elements, parameters, scope, and duration of 

such models for testing or dissemination; 

‘‘(D) determinations regarding budget neutrality under 

subsection (b)(3); 

‘‘(E) the termination or modification of the design and 

implementation of a model under subsection (b)(3)(B); and 

‘‘(F) determinations about expansion of the duration 

and scope of a model under subsection (c), including the 

determination that a model is not expected to meet criteria 

described in paragraph (1) or (2) of such subsection. 

‘‘(3) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to the testing and evaluation of models 

or expansion of such models under this section. 

‘‘(e) APPLICATION TO CHIP.—The Center may carry out activities under this section with respect to title XXI in the same manner 

as provided under this section with respect to the program under 

the applicable titles. 

‘‘(f) FUNDING.— 

‘‘(1) IN GENERAL.—There are appropriated, from amounts 

in the Treasury not otherwise appropriated— 

‘‘(A) $5,000,000 for the design, implementation, and 

evaluation of models under subsection (b) for fiscal year 

2010; 

‘‘(B) $10,000,000,000 for the activities initiated under 

this section for the period of fiscal years 2011 through 

2019; and 

‘‘(C) the amount described in subparagraph (B) for 

the activities initiated under this section for each subsequent 10-year fiscal period (beginning with the 10-year 

fiscal period beginning with fiscal year 2020). 

Amounts appropriated under the preceding sentence shall 

remain available until expended. 

‘‘(2) USE OF CERTAIN FUNDS.—Out of amounts appropriated 

under subparagraphs (B) and (C) of paragraph (1), not less 

than $25,000,000 shall be made available each such fiscal year 

to design, implement, and evaluate models under subsection 

(b). 

‘‘(g) REPORT TO CONGRESS.—Beginning in 2012, and not less 

than once every other year thereafter, the Secretary shall submit 

to Congress a report on activities under this section. Each such 

report shall describe the models tested under subsection (b), 

including the number of individuals described in subsection 

(a)(4)(A)(i) and of individuals described in subsection (a)(4)(A)(ii) 

participating in such models and payments made under applicable 

titles for services on behalf of such individuals, any models chosen 

for expansion under subsection (c), and the results from evaluations 

under subsection (b)(4). In addition, each such report shall provide 

such recommendations as the Secretary determines are appropriate 

for legislative action to facilitate the development and expansion 

of successful payment models.’’. 

(b) MEDICAID CONFORMING AMENDMENT.—Section 1902(a) of 

the Social Security Act (42 U.S.C. 1396a(a)), as amended by section 

8002(b), is amended— 

(1) in paragraph (81), by striking ‘‘and’’ at the end; 
H. R. 3590—277 

(2) in paragraph (82), by striking the period at the end 

and inserting ‘‘; and’’; and 

(3) by inserting after paragraph (82) the following new 

paragraph: 

‘‘(83) provide for implementation of the payment models 

specified by the Secretary under section 1115A(c) for 

implementation on a nationwide basis unless the State demonstrates to the satisfaction of the Secretary that implementation would not be administratively feasible or appropriate to 

the health care delivery system of the State.’’. 

(c) REVISIONS TO HEALTH CARE QUALITY DEMONSTRATION PROGRAM.—Subsections (b) and (f) of section 1866C of the Social Security Act (42 U.S.C. 1395cc–3) are amended by striking ‘‘5-year’’ 

each place it appears. 

SEC. 3022. MEDICARE SHARED SAVINGS PROGRAM. 

Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) 

is amended by adding at the end the following new section: 

‘‘SHARED SAVINGS PROGRAM

‘‘SEC. 1899. (a) ESTABLISHMENT.— ‘‘(1) IN GENERAL.—Not later than January 1, 2012, the 

Secretary shall establish a shared savings program (in this 

section referred to as the ‘program’) that promotes accountability for a patient population and coordinates items and services under parts A and B, and encourages investment in infrastructure and redesigned care processes for high quality and 

efficient service delivery. Under such program— 

‘‘(A) groups of providers of services and suppliers 

meeting criteria specified by the Secretary may work 

together to manage and coordinate care for Medicare feefor-service beneficiaries through an accountable care 

organization (referred to in this section as an ‘ACO’); and 

‘‘(B) ACOs that meet quality performance standards 

established by the Secretary are eligible to receive payments for shared savings under subsection (d)(2). 

‘‘(b) ELIGIBLE ACOS.— ‘‘(1) IN GENERAL.—Subject to the succeeding provisions of 

this subsection, as determined appropriate by the Secretary, 

the following groups of providers of services and suppliers which 

have established a mechanism for shared governance are 

eligible to participate as ACOs under the program under this 

section: 

‘‘(A) ACO professionals in group practice arrangements. 

‘‘(B) Networks of individual practices of ACO professionals. 

‘‘(C) Partnerships or joint venture arrangements 

between hospitals and ACO professionals. 

‘‘(D) Hospitals employing ACO professionals. 

‘‘(E) Such other groups of providers of services and 

suppliers as the Secretary determines appropriate. 

‘‘(2) REQUIREMENTS.—An ACO shall meet the following 

requirements: 

‘‘(A) The ACO shall be willing to become accountable 

for the quality, cost, and overall care of the Medicare 

fee-for-service beneficiaries assigned to it. 
H. R. 3590—278 

‘‘(B) The ACO shall enter into an agreement with the 

Secretary to participate in the program for not less than 

a 3-year period (referred to in this section as the ‘agreement 

period’). 

‘‘(C) The ACO shall have a formal legal structure that 

would allow the organization to receive and distribute payments for shared savings under subsection (d)(2) to participating providers of services and suppliers. 

‘‘(D) The ACO shall include primary care ACO professionals that are sufficient for the number of Medicare feefor-service beneficiaries assigned to the ACO under subsection (c). At a minimum, the ACO shall have at least 

5,000 such beneficiaries assigned to it under subsection 

(c) in order to be eligible to participate in the ACO program. 

‘‘(E) The ACO shall provide the Secretary with such 

information regarding ACO professionals participating in 

the ACO as the Secretary determines necessary to support 

the assignment of Medicare fee-for-service beneficiaries to 

an ACO, the implementation of quality and other reporting 

requirements under paragraph (3), and the determination 

of payments for shared savings under subsection (d)(2). 

‘‘(F) The ACO shall have in place a leadership and 

management structure that includes clinical and administrative systems. 

‘‘(G) The ACO shall define processes to promote evidence-based medicine and patient engagement, report on 

quality and cost measures, and coordinate care, such as 

through the use of telehealth, remote patient monitoring, 

and other such enabling technologies. 

‘‘(H) The ACO shall demonstrate to the Secretary that 

it meets patient-centeredness criteria specified by the Secretary, such as the use of patient and caregiver assessments 

or the use of individualized care plans. 

‘‘(3) QUALITY AND OTHER REPORTING REQUIREMENTS.— 

‘‘(A) IN GENERAL.—The Secretary shall determine 

appropriate measures to assess the quality of care furnished by the ACO, such as measures of— 

‘‘(i) clinical processes and outcomes; 

‘‘(ii) patient and, where practicable, caregiver 

experience of care; and 

‘‘(iii) utilization (such as rates of hospital admissions for ambulatory care sensitive conditions). 

‘‘(B) REPORTING REQUIREMENTS.—An ACO shall submit 

data in a form and manner specified by the Secretary 

on measures the Secretary determines necessary for the 

ACO to report in order to evaluate the quality of care 

furnished by the ACO. Such data may include care transitions across health care settings, including hospital discharge planning and post-hospital discharge follow-up by 

ACO professionals, as the Secretary determines appropriate. 

‘‘(C) QUALITY PERFORMANCE STANDARDS.—The Secretary shall establish quality performance standards to 

assess the quality of care furnished by ACOs. The Secretary 

shall seek to improve the quality of care furnished by 
H. R. 3590—279 

ACOs over time by specifying higher standards, new measures, or both for purposes of assessing such quality of 

care. 

‘‘(D) OTHER REPORTING REQUIREMENTS.—The Secretary 

may, as the Secretary determines appropriate, incorporate 

reporting requirements and incentive payments related to 

the physician quality reporting initiative (PQRI) under section 1848, including such requirements and such payments 

related to electronic prescribing, electronic health records, 

and other similar initiatives under section 1848, and may 

use alternative criteria than would otherwise apply under 

such section for determining whether to make such payments. The incentive payments described in the preceding 

sentence shall not be taken into consideration when calculating any payments otherwise made under subsection (d). 

‘‘(4) NO DUPLICATION IN PARTICIPATION IN SHARED SAVINGS

PROGRAMS.—A provider of services or supplier that participates 

in any of the following shall not be eligible to participate 

in an ACO under this section: 

‘‘(A) A model tested or expanded under section 1115A 

that involves shared savings under this title, or any other 

program or demonstration project that involves such shared 

savings. 

‘‘(B) The independence at home medical practice pilot 

program under section 1866E. 

‘‘(c) ASSIGNMENT OF MEDICARE FEE-FOR-SERVICE BENEFICIARIES

TO ACOS.—The Secretary shall determine an appropriate method 

to assign Medicare fee-for-service beneficiaries to an ACO based 

on their utilization of primary care services provided under this 

title by an ACO professional described in subsection (h)(1)(A). 

‘‘(d) PAYMENTS AND TREATMENT OF SAVINGS.— ‘‘(1) PAYMENTS.— 

‘‘(A) IN GENERAL.—Under the program, subject to paragraph (3), payments shall continue to be made to providers 

of services and suppliers participating in an ACO under 

the original Medicare fee-for-service program under parts 

A and B in the same manner as they would otherwise 

be made except that a participating ACO is eligible to 

receive payment for shared savings under paragraph (2) 

if— 

‘‘(i) the ACO meets quality performance standards 

established by the Secretary under subsection (b)(3); 

and 

‘‘(ii) the ACO meets the requirement under 

subparagraph (B)(i). 

‘‘(B) SAVINGS REQUIREMENT AND BENCHMARK.— ‘‘(i) DETERMINING SAVINGS.—In each year of the 

agreement period, an ACO shall be eligible to receive 

payment for shared savings under paragraph (2) only 

if the estimated average per capita Medicare expenditures under the ACO for Medicare fee-for-service beneficiaries for parts A and B services, adjusted for beneficiary characteristics, is at least the percent specified 

by the Secretary below the applicable benchmark under 

clause (ii). The Secretary shall determine the appropriate percent described in the preceding sentence to 

account for normal variation in expenditures under 
H. R. 3590—280 

this title, based upon the number of Medicare feefor-service beneficiaries assigned to an ACO. 

‘‘(ii) ESTABLISH AND UPDATE BENCHMARK.—The 

Secretary shall estimate a benchmark for each agreement period for each ACO using the most recent available 3 years of per-beneficiary expenditures for parts 

A and B services for Medicare fee-for-service beneficiaries assigned to the ACO. Such benchmark shall 

be adjusted for beneficiary characteristics and such 

other factors as the Secretary determines appropriate 

and updated by the projected absolute amount of 

growth in national per capita expenditures for parts 

A and B services under the original Medicare feefor-service program, as estimated by the Secretary. 

Such benchmark shall be reset at the start of each 

agreement period. 

‘‘(2) PAYMENTS FOR SHARED SAVINGS.—Subject to performance with respect to the quality performance standards established by the Secretary under subsection (b)(3), if an ACO 

meets the requirements under paragraph (1), a percent (as 

determined appropriate by the Secretary) of the difference 

between such estimated average per capita Medicare expenditures in a year, adjusted for beneficiary characteristics, under 

the ACO and such benchmark for the ACO may be paid to 

the ACO as shared savings and the remainder of such difference 

shall be retained by the program under this title. The Secretary 

shall establish limits on the total amount of shared savings 

that may be paid to an ACO under this paragraph. 

‘‘(3) MONITORING AVOIDANCE OF AT-RISK PATIENTS.—If the 

Secretary determines that an ACO has taken steps to avoid 

patients at risk in order to reduce the likelihood of increasing 

costs to the ACO the Secretary may impose an appropriate 

sanction on the ACO, including termination from the program. 

‘‘(4) TERMINATION.—The Secretary may terminate an agreement with an ACO if it does not meet the quality performance 

standards established by the Secretary under subsection (b)(3). 

‘‘(e) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to the program. 

‘‘(f) WAIVER AUTHORITY.—The Secretary may waive such 

requirements of sections 1128A and 1128B and title XVIII of this 

Act as may be necessary to carry out the provisions of this section. 

‘‘(g) LIMITATIONS ON REVIEW.—There shall be no administrative 

or judicial review under section 1869, section 1878, or otherwise 

of— 

‘‘(1) the specification of criteria under subsection (a)(1)(B); 

‘‘(2) the assessment of the quality of care furnished by 

an ACO and the establishment of performance standards under 

subsection (b)(3); 

‘‘(3) the assignment of Medicare fee-for-service beneficiaries 

to an ACO under subsection (c); 

‘‘(4) the determination of whether an ACO is eligible for 

shared savings under subsection (d)(2) and the amount of such 

shared savings, including the determination of the estimated 

average per capita Medicare expenditures under the ACO for 

Medicare fee-for-service beneficiaries assigned to the ACO and 

the average benchmark for the ACO under subsection (d)(1)(B); 
H. R. 3590—281 

‘‘(5) the percent of shared savings specified by the Secretary 

under subsection (d)(2) and any limit on the total amount 

of shared savings established by the Secretary under such 

subsection; and 

‘‘(6) the termination of an ACO under subsection (d)(4). 

‘‘(h) DEFINITIONS.—In this section: 

‘‘(1) ACO PROFESSIONAL.—The term ‘ACO professional’ 

means— 

‘‘(A) a physician (as defined in section 1861(r)(1)); and 

‘‘(B) a practitioner described in section 

1842(b)(18)(C)(i). 

‘‘(2) HOSPITAL.—The term ‘hospital’ means a subsection 

(d) hospital (as defined in section 1886(d)(1)(B)). 

‘‘(3) MEDICARE FEE-FOR-SERVICE BENEFICIARY.—The term 

‘Medicare fee-for-service beneficiary’ means an individual who 

is enrolled in the original Medicare fee-for-service program 

under parts A and B and is not enrolled in an MA plan 

under part C, an eligible organization under section 1876, or 

a PACE program under section 1894.’’. 

SEC. 3023. NATIONAL PILOT PROGRAM ON PAYMENT BUNDLING. 

Title XVIII of the Social Security Act, as amended by section 

3021, is amended by inserting after section 1886C the following 

new section: 

‘‘NATIONAL PILOT PROGRAM ON PAYMENT BUNDLING

‘‘SEC. 1866D. (a) IMPLEMENTATION.— ‘‘(1) IN GENERAL.—The Secretary shall establish a pilot 

program for integrated care during an episode of care provided 

to an applicable beneficiary around a hospitalization in order 

to improve the coordination, quality, and efficiency of health 

care services under this title. 

‘‘(2) DEFINITIONS.—In this section: 

‘‘(A) APPLICABLE BENEFICIARY.—The term ‘applicable 

beneficiary’ means an individual who— 

‘‘(i) is entitled to, or enrolled for, benefits under 

part A and enrolled for benefits under part B of such 

title, but not enrolled under part C or a PACE program 

under section 1894; and 

‘‘(ii) is admitted to a hospital for an applicable 

condition. 

‘‘(B) APPLICABLE CONDITION.—The term ‘applicable 

condition’ means 1 or more of 8 conditions selected by 

the Secretary. In selecting conditions under the preceding 

sentence, the Secretary shall take into consideration the 

following factors: 

‘‘(i) Whether the conditions selected include a mix 

of chronic and acute conditions. 

‘‘(ii) Whether the conditions selected include a mix 

of surgical and medical conditions. 

‘‘(iii) Whether a condition is one for which there 

is evidence of an opportunity for providers of services 

and suppliers to improve the quality of care furnished 

while reducing total expenditures under this title. 

‘‘(iv) Whether a condition has significant variation 

in— 

‘‘(I) the number of readmissions; and 
H. R. 3590—282 

‘‘(II) the amount of expenditures for post-acute 

care spending under this title. 

‘‘(v) Whether a condition is high-volume and has 

high post-acute care expenditures under this title. 

‘‘(vi) Which conditions the Secretary determines 

are most amenable to bundling across the spectrum 

of care given practice patterns under this title. 

‘‘(C) APPLICABLE SERVICES.—The term ‘applicable services’ means the following: 

‘‘(i) Acute care inpatient services. 

‘‘(ii) Physicians’ services delivered in and outside 

of an acute care hospital setting. 

‘‘(iii) Outpatient hospital services, including emergency department services. 

‘‘(iv) Post-acute care services, including home 

health services, skilled nursing services, inpatient 

rehabilitation services, and inpatient hospital services 

furnished by a long-term care hospital. 

‘‘(v) Other services the Secretary determines appropriate. 

‘‘(D) EPISODE OF CARE.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the term 

‘episode of care’ means, with respect to an applicable 

condition and an applicable beneficiary, the period that 

includes— 

‘‘(I) the 3 days prior to the admission of the 

applicable beneficiary to a hospital for the 

applicable condition; 

‘‘(II) the length of stay of the applicable beneficiary in such hospital; and 

‘‘(III) the 30 days following the discharge of 

the applicable beneficiary from such hospital. 

‘‘(ii) ESTABLISHMENT OF PERIOD BY THE SEC- RETARY.—The Secretary, as appropriate, may establish 

a period (other than the period described in clause 

(i)) for an episode of care under the pilot program. 

‘‘(E) PHYSICIANS’ SERVICES.—The term ‘physicians’ 

services’ has the meaning given such term in section 

1861(q). 

‘‘(F) PILOT PROGRAM.—The term ‘pilot program’ means 

the pilot program under this section. 

‘‘(G) PROVIDER OF SERVICES.—The term ‘provider of 

services’ has the meaning given such term in section 

1861(u). 

‘‘(H) READMISSION.—The term ‘readmission’ has the 

meaning given such term in section 1886(q)(5)(E). 

‘‘(I) SUPPLIER.—The term ‘supplier’ has the meaning 

given such term in section 1861(d). 

‘‘(3) DEADLINE FOR IMPLEMENTATION.—The Secretary shall 

establish the pilot program not later than January 1, 2013. 

‘‘(b) DEVELOPMENTAL PHASE.— ‘‘(1) DETERMINATION OF PATIENT ASSESSMENT

INSTRUMENT.—The Secretary shall determine which patient 

assessment instrument (such as the Continuity Assessment 

Record and Evaluation (CARE) tool) shall be used under the 

pilot program to evaluate the applicable condition of an 

applicable beneficiary for purposes of determining the most 
H. R. 3590—283 

clinically appropriate site for the provision of post-acute care 

to the applicable beneficiary. 

‘‘(2) DEVELOPMENT OF QUALITY MEASURES FOR AN EPISODE

OF CARE AND FOR POST-ACUTE CARE.— 

‘‘(A) IN GENERAL.—The Secretary, in consultation with 

the Agency for Healthcare Research and Quality and the 

entity with a contract under section 1890(a) of the Social 

Security Act, shall develop quality measures for use in 

the pilot program— 

‘‘(i) for episodes of care; and 

‘‘(ii) for post-acute care. 

‘‘(B) SITE-NEUTRAL POST-ACUTE CARE QUALITY MEASURES.—Any quality measures developed under subparagraph (A)(ii) shall be site-neutral. 

‘‘(C) COORDINATION WITH QUALITY MEASURE DEVELOPMENT AND ENDORSEMENT PROCEDURES.—The Secretary 

shall ensure that the development of quality measures 

under subparagraph (A) is done in a manner that is consistent with the measures developed and endorsed under 

section 1890 and 1890A that are applicable to all postacute care settings. 

‘‘(c) DETAILS.— 

‘‘(1) DURATION.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

pilot program shall be conducted for a period of 5 years. 

‘‘(B) EXTENSION.—The Secretary may extend the duration of the pilot program for providers of services and 

suppliers participating in the pilot program as of the day 

before the end of the 5-year period described in subparagraph (A), for a period determined appropriate by the Secretary, if the Secretary determines that such extension 

will result in improving or not reducing the quality of 

patient care and reducing spending under this title. 

‘‘(2) PARTICIPATING PROVIDERS OF SERVICES AND SUP- PLIERS.— 

‘‘(A) IN GENERAL.—An entity comprised of providers 

of services and suppliers, including a hospital, a physician 

group, a skilled nursing facility, and a home health agency, 

who are otherwise participating under this title, may 

submit an application to the Secretary to provide applicable 

services to applicable individuals under this section. 

‘‘(B) REQUIREMENTS.—The Secretary shall develop 

requirements for entities to participate in the pilot program 

under this section. Such requirements shall ensure that 

applicable beneficiaries have an adequate choice of providers of services and suppliers under the pilot program. 

‘‘(3) PAYMENT METHODOLOGY.— ‘‘(A) IN GENERAL.— ‘‘(i) ESTABLISHMENT OF PAYMENT METHODS.—The 

Secretary shall develop payment methods for the pilot 

program for entities participating in the pilot program. 

Such payment methods may include bundled payments 

and bids from entities for episodes of care. The Secretary shall make payments to the entity for services 

covered under this section. 

‘‘(ii) NO ADDITIONAL PROGRAM EXPENDITURES.— 

Payments under this section for applicable items and 
H. R. 3590—284 

services under this title (including payment for services 

described in subparagraph (B)) for applicable beneficiaries for a year shall be established in a manner 

that does not result in spending more for such entity 

for such beneficiaries than would otherwise be 

expended for such entity for such beneficiaries for such 

year if the pilot program were not implemented, as 

estimated by the Secretary. 

‘‘(B) INCLUSION OF CERTAIN SERVICES.—A payment 

methodology tested under the pilot program shall include 

payment for the furnishing of applicable services and other 

appropriate services, such as care coordination, medication 

reconciliation, discharge planning, transitional care services, and other patient-centered activities as determined 

appropriate by the Secretary. 

‘‘(C) BUNDLED PAYMENTS.— 

‘‘(i) IN GENERAL.—A bundled payment under the 

pilot program shall— 

‘‘(I) be comprehensive, covering the costs of 

applicable services and other appropriate services 

furnished to an individual during an episode of 

care (as determined by the Secretary); and 

‘‘(II) be made to the entity which is participating in the pilot program. 

‘‘(ii) REQUIREMENT FOR PROVISION OF APPLICABLE

SERVICES AND OTHER APPROPRIATE SERVICES.— 

Applicable services and other appropriate services for 

which payment is made under this subparagraph shall 

be furnished or directed by the entity which is participating in the pilot program. 

‘‘(D) PAYMENT FOR POST-ACUTE CARE SERVICES AFTER

THE EPISODE OF CARE.—The Secretary shall establish procedures, in the case where an applicable beneficiary requires 

continued post-acute care services after the last day of 

the episode of care, under which payment for such services 

shall be made. 

‘‘(4) QUALITY MEASURES.— ‘‘(A) IN GENERAL.—The Secretary shall establish 

quality measures (including quality measures of process, 

outcome, and structure) related to care provided by entities 

participating in the pilot program. Quality measures established under the preceding sentence shall include measures 

of the following: 

‘‘(i) Functional status improvement. 

‘‘(ii) Reducing rates of avoidable hospital readmissions. 

‘‘(iii) Rates of discharge to the community. 

‘‘(iv) Rates of admission to an emergency room 

after a hospitalization. 

‘‘(v) Incidence of health care acquired infections. 

‘‘(vi) Efficiency measures. 

‘‘(vii) Measures of patient-centeredness of care. 

‘‘(viii) Measures of patient perception of care. 

‘‘(ix) Other measures, including measures of 

patient outcomes, determined appropriate by the Secretary. 

‘‘(B) REPORTING ON QUALITY MEASURES.— 
H. R. 3590—285 

‘‘(i) IN GENERAL.—A entity shall submit data to 

the Secretary on quality measures established under 

subparagraph (A) during each year of the pilot program 

(in a form and manner, subject to clause (iii), specified 

by the Secretary). 

‘‘(ii) SUBMISSION OF DATA THROUGH ELECTRONIC

HEALTH RECORD.—To the extent practicable, the Secretary shall specify that data on measures be submitted 

under clause (i) through the use of an qualified electronic health record (as defined in section 3000(13) 

of the Public Health Service Act (42 U.S.C. 300jj– 

11(13)) in a manner specified by the Secretary. 

‘‘(d) WAIVER.—The Secretary may waive such provisions of this 

title and title XI as may be necessary to carry out the pilot program. 

‘‘(e) INDEPENDENT EVALUATION AND REPORTS ON PILOT PROGRAM.— 

‘‘(1) INDEPENDENT EVALUATION.—The Secretary shall conduct an independent evaluation of the pilot program, including 

the extent to which the pilot program has— 

‘‘(A) improved quality measures established under subsection (c)(4)(A); 

‘‘(B) improved health outcomes; 

‘‘(C) improved applicable beneficiary access to care; 

and 

‘‘(D) reduced spending under this title. 

‘‘(2) REPORTS.— 

‘‘(A) INTERIM REPORT.—Not later than 2 years after 

the implementation of the pilot program, the Secretary 

shall submit to Congress a report on the initial results 

of the independent evaluation conducted under paragraph 

(1). 

‘‘(B) FINAL REPORT.—Not later than 3 years after the 

implementation of the pilot program, the Secretary shall 

submit to Congress a report on the final results of the 

independent evaluation conducted under paragraph (1). 

‘‘(f) CONSULTATION.—The Secretary shall consult with representatives of small rural hospitals, including critical access hospitals (as defined in section 1861(mm)(1)), regarding their participation in the pilot program. Such consultation shall include consideration of innovative methods of implementing bundled payments 

in hospitals described in the preceding sentence, taking into consideration any difficulties in doing so as a result of the low volume 

of services provided by such hospitals. 

‘‘(g) IMPLEMENTATION PLAN.— 

‘‘(1) IN GENERAL.—Not later than January 1, 2016, the 

Secretary shall submit a plan for the implementation of an 

expansion of the pilot program if the Secretary determines 

that such expansion will result in improving or not reducing 

the quality of patient care and reducing spending under this 

title. 

‘‘(h) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to the selection, testing, and evaluation of 

models or the expansion of such models under this section.’’. 
H. R. 3590—286 

SEC. 3024. INDEPENDENCE AT HOME DEMONSTRATION PROGRAM. 

Title XVIII of the Social Security Act is amended by inserting 

after section 1866D, as inserted by section 3023, the following 

new section: 

‘‘INDEPENDENCE AT HOME MEDICAL PRACTICE DEMONSTRATION

PROGRAM

‘‘SEC. 1866D. (a) ESTABLISHMENT.— 

‘‘(1) IN GENERAL.—The Secretary shall conduct a demonstration program (in this section referred to as the ‘demonstration program’) to test a payment incentive and service 

delivery model that utilizes physician and nurse practitioner 

directed home-based primary care teams designed to reduce 

expenditures and improve health outcomes in the provision 

of items and services under this title to applicable beneficiaries 

(as defined in subsection (d)). 

‘‘(2) REQUIREMENT.—The demonstration program shall test 

whether a model described in paragraph (1), which is accountable for providing comprehensive, coordinated, continuous, and 

accessible care to high-need populations at home and coordinating health care across all treatment settings, results in— 

‘‘(A) reducing preventable hospitalizations; 

‘‘(B) preventing hospital readmissions; 

‘‘(C) reducing emergency room visits; 

‘‘(D) improving health outcomes commensurate with 

the beneficiaries’ stage of chronic illness; 

‘‘(E) improving the efficiency of care, such as by 

reducing duplicative diagnostic and laboratory tests; 

‘‘(F) reducing the cost of health care services covered 

under this title; and 

‘‘(G) achieving beneficiary and family caregiver satisfaction. 

‘‘(b) INDEPENDENCE AT HOME MEDICAL PRACTICE.— 

‘‘(1) INDEPENDENCE AT HOME MEDICAL PRACTICE DEFINED.— 

In this section: 

‘‘(A) IN GENERAL.—The term ‘independence at home 

medical practice’ means a legal entity that— 

‘‘(i) is comprised of an individual physician or nurse 

practitioner or group of physicians and nurse practitioners that provides care as part of a team that 

includes physicians, nurses, physician assistants, pharmacists, and other health and social services staff as 

appropriate who have experience providing home-based 

primary care to applicable beneficiaries, make in-home 

visits, and are available 24 hours per day, 7 days 

per week to carry out plans of care that are tailored 

to the individual beneficiary’s chronic conditions and 

designed to achieve the results in subsection (a); 

‘‘(ii) is organized at least in part for the purpose 

of providing physicians’ services; 

‘‘(iii) has documented experience in providing 

home-based primary care services to high-cost chronically ill beneficiaries, as determined appropriate by 

the Secretary; 
H. R. 3590—287 

‘‘(iv) furnishes services to at least 200 applicable 

beneficiaries (as defined in subsection (d)) during each 

year of the demonstration program; 

‘‘(v) has entered into an agreement with the Secretary; 

‘‘(vi) uses electronic health information systems, 

remote monitoring, and mobile diagnostic technology; 

and 

‘‘(vii) meets such other criteria as the Secretary 

determines to be appropriate to participate in the demonstration program. 

The entity shall report on quality measures (in such form, 

manner, and frequency as specified by the Secretary, which 

may be for the group, for providers of services and suppliers, or both) and report to the Secretary (in a form, 

manner, and frequency as specified by the Secretary) such 

data as the Secretary determines appropriate to monitor 

and evaluate the demonstration program. 

‘‘(B) PHYSICIAN.—The term ‘physician’ includes, except 

as the Secretary may otherwise provide, any individual 

who furnishes services for which payment may be made 

as physicians’ services and has the medical training or 

experience to fulfill the physician’s role described in 

subparagraph (A)(i). 

‘‘(2) PARTICIPATION OF NURSE PRACTITIONERS AND PHYSICIAN

ASSISTANTS.—Nothing in this section shall be construed to prevent a nurse practitioner or physician assistant from participating in, or leading, a home-based primary care team as 

part of an independence at home medical practice if— 

‘‘(A) all the requirements of this section are met; 

‘‘(B) the nurse practitioner or physician assistant, as 

the case may be, is acting consistent with State law; and 

‘‘(C) the nurse practitioner or physician assistant has 

the medical training or experience to fulfill the nurse 

practitioner or physician assistant role described in paragraph (1)(A)(i). 

‘‘(3) INCLUSION OF PROVIDERS AND PRACTITIONERS.— 

Nothing in this subsection shall be construed as preventing 

an independence at home medical practice from including a 

provider of services or a participating practitioner described 

in section 1842(b)(18)(C) that is affiliated with the practice 

under an arrangement structured so that such provider of 

services or practitioner participates in the demonstration program and shares in any savings under the demonstration program. 

‘‘(4) QUALITY AND PERFORMANCE STANDARDS.—The Secretary shall develop quality performance standards for 

independence at home medical practices participating in the 

demonstration program. 

‘‘(c) PAYMENT METHODOLOGY.— 

‘‘(1) ESTABLISHMENT OF TARGET SPENDING LEVEL.—The Secretary shall establish an estimated annual spending target, 

for the amount the Secretary estimates would have been spent 

in the absence of the demonstration, for items and services 
H. R. 3590—288 

covered under parts A and B furnished to applicable beneficiaries for each qualifying independence at home medical practice under this section. Such spending targets shall be determined on a per capita basis. Such spending targets shall include 

a risk corridor that takes into account normal variation in 

expenditures for items and services covered under parts A 

and B furnished to such beneficiaries with the size of the 

corridor being related to the number of applicable beneficiaries 

furnished services by each independence at home medical practice. The spending targets may also be adjusted for other factors 

as the Secretary determines appropriate. 

‘‘(2) INCENTIVE PAYMENTS.—Subject to performance on 

quality measures, a qualifying independence at home medical 

practice is eligible to receive an incentive payment under this 

section if actual expenditures for a year for the applicable 

beneficiaries it enrolls are less than the estimated spending 

target established under paragraph (1) for such year. An incentive payment for such year shall be equal to a portion (as 

determined by the Secretary) of the amount by which actual 

expenditures (including incentive payments under this paragraph) for applicable beneficiaries under parts A and B for 

such year are estimated to be less than 5 percent less than 

the estimated spending target for such year, as determined 

under paragraph (1). 

‘‘(d) APPLICABLE BENEFICIARIES.— ‘‘(1) DEFINITION.—In this section, the term ‘applicable beneficiary’ means, with respect to a qualifying independence at 

home medical practice, an individual who the practice has 

determined— 

‘‘(A) is entitled to benefits under part A and enrolled 

for benefits under part B; 

‘‘(B) is not enrolled in a Medicare Advantage plan 

under part C or a PACE program under section 1894; 

‘‘(C) has 2 or more chronic illnesses, such as congestive 

heart failure, diabetes, other dementias designated by the 

Secretary, chronic obstructive pulmonary disease, ischemic 

heart disease, stroke, Alzheimer’s Disease and 

neurodegenerative diseases, and other diseases and conditions designated by the Secretary which result in high 

costs under this title; 

‘‘(D) within the past 12 months has had a nonelective 

hospital admission; 

‘‘(E) within the past 12 months has received acute 

or subacute rehabilitation services; 

‘‘(F) has 2 or more functional dependencies requiring 

the assistance of another person (such as bathing, dressing, 

toileting, walking, or feeding); and 

‘‘(G) meets such other criteria as the Secretary determines appropriate. 

‘‘(2) PATIENT ELECTION TO PARTICIPATE.—The Secretary 

shall determine an appropriate method of ensuring that 

applicable beneficiaries have agreed to enroll in an independence at home medical practice under the demonstration program. Enrollment in the demonstration program shall be voluntary. 

‘‘(3) BENEFICIARY ACCESS TO SERVICES.—Nothing in this 

section shall be construed as encouraging physicians or nurse 
H. R. 3590—289 

practitioners to limit applicable beneficiary access to services 

covered under this title and applicable beneficiaries shall not 

be required to relinquish access to any benefit under this title 

as a condition of receiving services from an independence at 

home medical practice. 

‘‘(e) IMPLEMENTATION.— 

‘‘(1) STARTING DATE.—The demonstration program shall 

begin no later than January 1, 2012. An agreement with an 

independence at home medical practice under the demonstration program may cover not more than a 3-year period. 

‘‘(2) NO PHYSICIAN DUPLICATION IN DEMONSTRATION PARTICIPATION.—The Secretary shall not pay an independence at home 

medical practice under this section that participates in section 

1899. 

‘‘(3) NO BENEFICIARY DUPLICATION IN DEMONSTRATION

PARTICIPATION.—The Secretary shall ensure that no applicable 

beneficiary enrolled in an independence at home medical practice under this section is participating in the programs under 

section 1899. 

‘‘(4) PREFERENCE.—In approving an independence at home 

medical practice, the Secretary shall give preference to practices 

that are— 

‘‘(A) located in high-cost areas of the country; 

‘‘(B) have experience in furnishing health care services 

to applicable beneficiaries in the home; and 

‘‘(C) use electronic medical records, health information 

technology, and individualized plans of care. 

‘‘(5) LIMITATION ON NUMBER OF PRACTICES.—In selecting 

qualified independence at home medical practices to participate 

under the demonstration program, the Secretary shall limit 

the number of such practices so that the number of applicable 

beneficiaries that may participate in the demonstration program does not exceed 10,000. 

‘‘(6) WAIVER.—The Secretary may waive such provisions 

of this title and title XI as the Secretary determines necessary 

in order to implement the demonstration program. 

‘‘(7) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to this section. 

‘‘(f) EVALUATION AND MONITORING.— 

‘‘(1) IN GENERAL.—The Secretary shall evaluate each 

independence at home medical practice under the demonstration program to assess whether the practice achieved the results 

described in subsection (a). 

‘‘(2) MONITORING APPLICABLE BENEFICIARIES.—The Secretary may monitor data on expenditures and quality of services 

under this title after an applicable beneficiary discontinues 

receiving services under this title through a qualifying 

independence at home medical practice. 

‘‘(g) REPORTS TO CONGRESS.—The Secretary shall conduct an 

independent evaluation of the demonstration program and submit 

to Congress a final report, including best practices under the demonstration program. Such report shall include an analysis of the 

demonstration program on coordination of care, expenditures under 

this title, applicable beneficiary access to services, and the quality 

of health care services provided to applicable beneficiaries. 

‘‘(h) FUNDING.—For purposes of administering and carrying 

out the demonstration program, other than for payments for items 
H. R. 3590—290 

and services furnished under this title and incentive payments 

under subsection (c), in addition to funds otherwise appropriated, 

there shall be transferred to the Secretary for the Center for Medicare & Medicaid Services Program Management Account from the 

Federal Hospital Insurance Trust Fund under section 1817 and 

the Federal Supplementary Medical Insurance Trust Fund under 

section 1841 (in proportions determined appropriate by the Secretary) $5,000,000 for each of fiscal years 2010 through 2015. 

Amounts transferred under this subsection for a fiscal year shall 

be available until expended. 

‘‘(i) TERMINATION.— ‘‘(1) MANDATORY TERMINATION.—The Secretary shall terminate an agreement with an independence at home medical 

practice if— 

‘‘(A) the Secretary estimates or determines that such 

practice will not receive an incentive payment for the 

second of 2 consecutive years under the demonstration 

program; or 

‘‘(B) such practice fails to meet quality standards 

during any year of the demonstration program. 

‘‘(2) PERMISSIVE TERMINATION.—The Secretary may terminate an agreement with an independence at home medical 

practice for such other reasons determined appropriate by the 

Secretary.’’. 

SEC. 3025. HOSPITAL READMISSIONS REDUCTION PROGRAM. 

(a) IN GENERAL.—Section 1886 of the Social Security Act (42 

U.S.C. 1395ww), as amended by sections 3001 and 3008, is amended 

by adding at the end the following new subsection: 

‘‘(q) HOSPITAL READMISSIONS REDUCTION PROGRAM.— ‘‘(1) IN GENERAL.—With respect to payment for discharges 

from an applicable hospital (as defined in paragraph (5)(C)) 

occurring during a fiscal year beginning on or after October 

1, 2012, in order to account for excess readmissions in the 

hospital, the Secretary shall reduce the payments that would 

otherwise be made to such hospital under subsection (d) (or 

section 1814(b)(3), as the case may be) for such a discharge 

by an amount equal to the product of— 

‘‘(A) the base operating DRG payment amount (as 

defined in paragraph (2)) for the discharge; and 

‘‘(B) the adjustment factor (described in paragraph 

(3)(A)) for the hospital for the fiscal year. 

‘‘(2) BASE OPERATING DRG PAYMENT AMOUNT DEFINED.— 

‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), in this subsection, the term ‘base operating DRG payment amount’ means, with respect to a hospital for a fiscal 

year— 

‘‘(i) the payment amount that would otherwise be 

made under subsection (d) (determined without regard 

to subsection (o)) for a discharge if this subsection 

did not apply; reduced by 

‘‘(ii) any portion of such payment amount that 

is attributable to payments under paragraphs (5)(A), 

(5)(B), (5)(F), and (12) of subsection (d). 

‘‘(B) SPECIAL RULES FOR CERTAIN HOSPITALS.— ‘‘(i) SOLE COMMUNITY HOSPITALS AND MEDICARE- DEPENDENT, SMALL RURAL HOSPITALS.—In the case of 
H. R. 3590—291 

a medicare-dependent, small rural hospital (with 

respect to discharges occurring during fiscal years 2012 

and 2013) or a sole community hospital, in applying 

subparagraph (A)(i), the payment amount that would 

otherwise be made under subsection (d) shall be determined without regard to subparagraphs (I) and (L) 

of subsection (b)(3) and subparagraphs (D) and (G) 

of subsection (d)(5). 

‘‘(ii) HOSPITALS PAID UNDER SECTION 1814.—In the 

case of a hospital that is paid under section 1814(b)(3), 

the Secretary may exempt such hospitals provided that 

States paid under such section submit an annual report 

to the Secretary describing how a similar program 

in the State for a participating hospital or hospitals 

achieves or surpasses the measured results in terms 

of patient health outcomes and cost savings established 

herein with respect to this section. 

‘‘(3) ADJUSTMENT FACTOR.— 

‘‘(A) IN GENERAL.—For purposes of paragraph (1), the 

adjustment factor under this paragraph for an applicable 

hospital for a fiscal year is equal to the greater of— 

‘‘(i) the ratio described in subparagraph (B) for 

the hospital for the applicable period (as defined in 

paragraph (5)(D)) for such fiscal year; or 

‘‘(ii) the floor adjustment factor specified in 

subparagraph (C). 

‘‘(B) RATIO.—The ratio described in this subparagraph 

for a hospital for an applicable period is equal to 1 minus 

the ratio of— 

‘‘(i) the aggregate payments for excess readmissions (as defined in paragraph (4)(A)) with respect 

to an applicable hospital for the applicable period; and 

‘‘(ii) the aggregate payments for all discharges (as 

defined in paragraph (4)(B)) with respect to such 

applicable hospital for such applicable period. 

‘‘(C) FLOOR ADJUSTMENT FACTOR.—For purposes of 

subparagraph (A), the floor adjustment factor specified in 

this subparagraph for— 

‘‘(i) fiscal year 2013 is 0.99; 

‘‘(ii) fiscal year 2014 is 0.98; or 

‘‘(iii) fiscal year 2015 and subsequent fiscal years 

is 0.97. 

‘‘(4) AGGREGATE PAYMENTS, EXCESS READMISSION RATIO

DEFINED.—For purposes of this subsection: 

‘‘(A) AGGREGATE PAYMENTS FOR EXCESS READMISSIONS.—The term ‘aggregate payments for excess readmissions’ means, for a hospital for an applicable period, the 

sum, for applicable conditions (as defined in paragraph 

(5)(A)), of the product, for each applicable condition, of— 

‘‘(i) the base operating DRG payment amount for 

such hospital for such applicable period for such condition; 

‘‘(ii) the number of admissions for such condition 

for such hospital for such applicable period; and 

‘‘(iii) the excess readmissions ratio (as defined in 

subparagraph (C)) for such hospital for such applicable 

period minus 1. 
H. R. 3590—292 

‘‘(B) AGGREGATE PAYMENTS FOR ALL DISCHARGES.—The 

term ‘aggregate payments for all discharges’ means, for 

a hospital for an applicable period, the sum of the base 

operating DRG payment amounts for all discharges for 

all conditions from such hospital for such applicable period. 

‘‘(C) EXCESS READMISSION RATIO.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the term 

‘excess readmissions ratio’ means, with respect to an 

applicable condition for a hospital for an applicable 

period, the ratio (but not less than 1.0) of— 

‘‘(I) the risk adjusted readmissions based on 

actual readmissions, as determined consistent with 

a readmission measure methodology that has been 

endorsed under paragraph (5)(A)(ii)(I), for an 

applicable hospital for such condition with respect 

to such applicable period; to 

‘‘(II) the risk adjusted expected readmissions 

(as determined consistent with such a methodology) for such hospital for such condition with 

respect to such applicable period. 

‘‘(ii) EXCLUSION OF CERTAIN READMISSIONS.—For 

purposes of clause (i), with respect to a hospital, excess 

readmissions shall not include readmissions for an 

applicable condition for which there are fewer than 

a minimum number (as determined by the Secretary) 

of discharges for such applicable condition for the 

applicable period and such hospital. 

‘‘(5) DEFINITIONS.—For purposes of this subsection: 

‘‘(A) APPLICABLE CONDITION.—The term ‘applicable 

condition’ means, subject to subparagraph (B), a condition 

or procedure selected by the Secretary among conditions 

and procedures for which— 

‘‘(i) readmissions (as defined in subparagraph (E)) 

that represent conditions or procedures that are high 

volume or high expenditures under this title (or other 

criteria specified by the Secretary); and 

‘‘(ii) measures of such readmissions— 

‘‘(I) have been endorsed by the entity with 

a contract under section 1890(a); and 

‘‘(II) such endorsed measures have exclusions 

for readmissions that are unrelated to the prior 

discharge (such as a planned readmission or 

transfer to another applicable hospital). 

‘‘(B) EXPANSION OF APPLICABLE CONDITIONS.—Beginning with fiscal year 2015, the Secretary shall, to the 

extent practicable, expand the applicable conditions beyond 

the 3 conditions for which measures have been endorsed 

as described in subparagraph (A)(ii)(I) as of the date of 

the enactment of this subsection to the additional 4 conditions that have been identified by the Medicare Payment 

Advisory Commission in its report to Congress in June 

2007 and to other conditions and procedures as determined 

appropriate by the Secretary. In expanding such applicable 

conditions, the Secretary shall seek the endorsement 

described in subparagraph (A)(ii)(I) but may apply such 

measures without such an endorsement in the case of a 

specified area or medical topic determined appropriate by 
H. R. 3590—293 

the Secretary for which a feasible and practical measure 

has not been endorsed by the entity with a contract under 

section 1890(a) as long as due consideration is given to 

measures that have been endorsed or adopted by a consensus organization identified by the Secretary. 

‘‘(C) APPLICABLE HOSPITAL.—The term ‘applicable hospital’ means a subsection (d) hospital or a hospital that 

is paid under section 1814(b)(3), as the case may be. 

‘‘(D) APPLICABLE PERIOD.—The term ‘applicable period’ 

means, with respect to a fiscal year, such period as the 

Secretary shall specify. 

‘‘(E) READMISSION.—The term ‘readmission’ means, in 

the case of an individual who is discharged from an 

applicable hospital, the admission of the individual to the 

same or another applicable hospital within a time period 

specified by the Secretary from the date of such discharge. 

Insofar as the discharge relates to an applicable condition 

for which there is an endorsed measure described in 

subparagraph (A)(ii)(I), such time period (such as 30 days) 

shall be consistent with the time period specified for such 

measure. 

‘‘(6) REPORTING HOSPITAL SPECIFIC INFORMATION.— 

‘‘(A) IN GENERAL.—The Secretary shall make information available to the public regarding readmission rates 

of each subsection (d) hospital under the program. 

‘‘(B) OPPORTUNITY TO REVIEW AND SUBMIT CORREC- TIONS.—The Secretary shall ensure that a subsection (d) 

hospital has the opportunity to review, and submit corrections for, the information to be made public with respect 

to the hospital under subparagraph (A) prior to such 

information being made public. 

‘‘(C) WEBSITE.—Such information shall be posted on 

the Hospital Compare Internet website in an easily understandable format. 

‘‘(7) LIMITATIONS ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of the following: 

‘‘(A) The determination of base operating DRG payment 

amounts. 

‘‘(B) The methodology for determining the adjustment 

factor under paragraph (3), including excess readmissions 

ratio under paragraph (4)(C), aggregate payments for 

excess readmissions under paragraph (4)(A), and aggregate 

payments for all discharges under paragraph (4)(B), and 

applicable periods and applicable conditions under paragraph (5). 

‘‘(C) The measures of readmissions as described in 

paragraph (5)(A)(ii). 

‘‘(8) READMISSION RATES FOR ALL PATIENTS.— ‘‘(A) CALCULATION OF READMISSION.—The Secretary 

shall calculate readmission rates for all patients (as defined 

in subparagraph (D)) for a specified hospital (as defined 

in subparagraph (D)(ii)) for an applicable condition (as 

defined in paragraph (5)(B)) and other conditions deemed 

appropriate by the Secretary for an applicable period (as 

defined in paragraph (5)(D)) in the same manner as used 

to calculate such readmission rates for hospitals with 
H. R. 3590—294 

respect to this title and posted on the CMS Hospital Compare website. 

‘‘(B) POSTING OF HOSPITAL SPECIFIC ALL PATIENT

READMISSION RATES.—The Secretary shall make information on all patient readmission rates calculated under 

subparagraph (A) available on the CMS Hospital Compare 

website in a form and manner determined appropriate 

by the Secretary. The Secretary may also make other 

information determined appropriate by the Secretary available on such website. 

‘‘(C) HOSPITAL SUBMISSION OF ALL PATIENT DATA.— ‘‘(i) Except as provided for in clause (ii), each specified hospital (as defined in subparagraph (D)(ii)) shall 

submit to the Secretary, in a form, manner and time 

specified by the Secretary, data and information determined necessary by the Secretary for the Secretary 

to calculate the all patient readmission rates described 

in subparagraph (A). 

‘‘(ii) Instead of a specified hospital submitting to 

the Secretary the data and information described in 

clause (i), such data and information may be submitted 

to the Secretary, on behalf of such a specified hospital, 

by a state or an entity determined appropriate by 

the Secretary. 

‘‘(D) DEFINITIONS.—For purposes of this paragraph: 

‘‘(i) The term ‘all patients’ means patients who 

are treated on an inpatient basis and discharged from 

a specified hospital (as defined in clause (ii)). 

‘‘(ii) The term ‘specified hospital’ means a subsection (d) hospital, hospitals described in clauses (i) 

through (v) of subsection (d)(1)(B) and, as determined 

feasible and appropriate by the Secretary, other hospitals not otherwise described in this subparagraph.’’. 

(b) QUALITY IMPROVEMENT.—Part S of title III of the Public 

Health Service Act, as amended by section 3015, is further amended 

by adding at the end the following: 

‘‘SEC. 399KK. QUALITY IMPROVEMENT PROGRAM FOR HOSPITALS 

WITH A HIGH SEVERITY ADJUSTED READMISSION RATE. 

‘‘(a) ESTABLISHMENT.— ‘‘(1) IN GENERAL.—Not later than 2 years after the date 

of enactment of this section, the Secretary shall make available 

a program for eligible hospitals to improve their readmission 

rates through the use of patient safety organizations (as defined 

in section 921(4)). 

‘‘(2) ELIGIBLE HOSPITAL DEFINED.—In this subsection, the 

term ‘eligible hospital’ means a hospital that the Secretary 

determines has a high rate of risk adjusted readmissions for 

the conditions described in section 1886(q)(8)(A) of the Social 

Security Act and has not taken appropriate steps to reduce 

such readmissions and improve patient safety as evidenced 

through historically high rates of readmissions, as determined 

by the Secretary. 

‘‘(3) RISK ADJUSTMENT.—The Secretary shall utilize appropriate risk adjustment measures to determine eligible hospitals. 

‘‘(b) REPORT TO THE SECRETARY.—As determined appropriate 

by the Secretary, eligible hospitals and patient safety organizations 
H. R. 3590—295 

working with those hospitals shall report to the Secretary on the 

processes employed by the hospital to improve readmission rates 

and the impact of such processes on readmission rates.’’. 

SEC. 3026. COMMUNITY-BASED CARE TRANSITIONS PROGRAM. 

(a) IN GENERAL.—The Secretary shall establish a CommunityBased Care Transitions Program under which the Secretary provides funding to eligible entities that furnish improved care transition services to high-risk Medicare beneficiaries. 

(b) DEFINITIONS.—In this section: 

(1) ELIGIBLE ENTITY.—The term ‘‘eligible entity’’ means the 

following: 

(A) A subsection (d) hospital (as defined in section 

1886(d)(1)(B) of the Social Security Act (42 U.S.C. 

1395ww(d)(1)(B))) identified by the Secretary as having 

a high readmission rate, such as under section 1886(q) 

of the Social Security Act, as added by section 3025. 

(B) An appropriate community-based organization that 

provides care transition services under this section across 

a continuum of care through arrangements with subsection 

(d) hospitals (as so defined) to furnish the services described 

in subsection (c)(2)(B)(i) and whose governing body includes 

sufficient representation of multiple health care stakeholders (including consumers). 

(2) HIGH-RISK MEDICARE BENEFICIARY.—The term ‘‘highrisk Medicare beneficiary’’ means a Medicare beneficiary who 

has attained a minimum hierarchical condition category score, 

as determined by the Secretary, based on a diagnosis of multiple 

chronic conditions or other risk factors associated with a hospital readmission or substandard transition into post-hospitalization care, which may include 1 or more of the following: 

(A) Cognitive impairment. 

(B) Depression. 

(C) A history of multiple readmissions. 

(D) Any other chronic disease or risk factor as determined by the Secretary. 

(3) MEDICARE BENEFICIARY.—The term ‘‘Medicare beneficiary’’ means an individual who is entitled to benefits under 

part A of title XVIII of the Social Security Act (42 U.S.C. 

1395 et seq.) and enrolled under part B of such title, but 

not enrolled under part C of such title. 

(4) PROGRAM.—The term ‘‘program’’ means the program 

conducted under this section. 

(5) READMISSION.—The term ‘‘readmission’’ has the 

meaning given such term in section 1886(q)(5)(E) of the Social 

Security Act, as added by section 3025. 

(6) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

(c) REQUIREMENTS.— (1) DURATION.— 

(A) IN GENERAL.—The program shall be conducted for 

a 5-year period, beginning January 1, 2011. 

(B) EXPANSION.—The Secretary may expand the duration and the scope of the program, to the extent determined 

appropriate by the Secretary, if the Secretary determines 

(and the Chief Actuary of the Centers for Medicare & 

Medicaid Services, with respect to spending under this 
H. R. 3590—296 

title, certifies) that such expansion would reduce spending 

under this title without reducing quality. 

(2) APPLICATION; PARTICIPATION.— 

(A) IN GENERAL.— 

(i) APPLICATION.—An eligible entity seeking to 

participate in the program shall submit an application 

to the Secretary at such time, in such manner, and 

containing such information as the Secretary may 

require. 

(ii) PARTNERSHIP.—If an eligible entity is a hospital, such hospital shall enter into a partnership with 

a community-based organization to participate in the 

program. 

(B) INTERVENTION PROPOSAL.—Subject to subparagraph 

(C), an application submitted under subparagraph (A)(i) 

shall include a detailed proposal for at least 1 care transition intervention, which may include the following: 

(i) Initiating care transition services for a highrisk Medicare beneficiary not later than 24 hours prior 

to the discharge of the beneficiary from the eligible 

entity. 

(ii) Arranging timely post-discharge follow-up services to the high-risk Medicare beneficiary to provide 

the beneficiary (and, as appropriate, the primary caregiver of the beneficiary) with information regarding 

responding to symptoms that may indicate additional 

health problems or a deteriorating condition. 

(iii) Providing the high-risk Medicare beneficiary 

(and, as appropriate, the primary caregiver of the beneficiary) with assistance to ensure productive and timely 

interactions between patients and post-acute and outpatient providers. 

(iv) Assessing and actively engaging with a highrisk Medicare beneficiary (and, as appropriate, the primary caregiver of the beneficiary) through the provision of self-management support and relevant information that is specific to the beneficiary’s condition. 

(v) Conducting comprehensive medication review 

and management (including, if appropriate, counseling 

and self-management support). 

(C) LIMITATION.—A care transition intervention proposed under subparagraph (B) may not include payment 

for services required under the discharge planning process 

described in section 1861(ee) of the Social Security Act 

(42 U.S.C. 1395x(ee)). 

(3) SELECTION.—In selecting eligible entities to participate 

in the program, the Secretary shall give priority to eligible 

entities that— 

(A) participate in a program administered by the 

Administration on Aging to provide concurrent care transitions interventions with multiple hospitals and practitioners; or 

(B) provide services to medically underserved populations, small communities, and rural areas. 

(d) IMPLEMENTATION.—Notwithstanding any other provision of 

law, the Secretary may implement the provisions of this section 

by program instruction or otherwise. 
H. R. 3590—297 

(e) WAIVER AUTHORITY.—The Secretary may waive such 

requirements of titles XI and XVIII of the Social Security Act 

as may be necessary to carry out the program. 

(f) FUNDING.—For purposes of carrying out this section, the 

Secretary of Health and Human Services shall provide for the 

transfer, from the Federal Hospital Insurance Trust Fund under 

section 1817 of the Social Security Act (42 U.S.C. 1395i) and the 

Federal Supplementary Medical Insurance Trust Fund under section 1841 of such Act (42 U.S.C. 1395t), in such proportion as 

the Secretary determines appropriate, of $500,000,000, to the Centers for Medicare & Medicaid Services Program Management 

Account for the period of fiscal years 2011 through 2015. Amounts 

transferred under the preceding sentence shall remain available 

until expended. 

SEC. 3027. EXTENSION OF GAINSHARING DEMONSTRATION. 

(a) IN GENERAL.—Subsection (d)(3) of section 5007 of the Deficit 

Reduction Act of 2005 (Public Law 109–171) is amended by inserting 

‘‘(or September 30, 2011, in the case of a demonstration project 

in operation as of October 1, 2008)’’ after ‘‘December 31, 2009’’. 

(b) FUNDING.— (1) IN GENERAL.—Subsection (f)(1) of such section is 

amended by inserting ‘‘and for fiscal year 2010, $1,600,000,’’ 

after ‘‘$6,000,000,’’. 

(2) AVAILABILITY.—Subsection (f)(2) of such section is 

amended by striking ‘‘2010’’ and inserting ‘‘2014 or until 

expended’’. 

(c) REPORTS.— 

(1) QUALITY IMPROVEMENT AND SAVINGS.—Subsection (e)(3) 

of such section is amended by striking ‘‘December 1, 2008’’ 

and inserting ‘‘March 31, 2011’’. 

(2) FINAL REPORT.—Subsection (e)(4) of such section is 

amended by striking ‘‘May 1, 2010’’ and inserting ‘‘March 31, 

2013’’. 

Subtitle B—Improving Medicare for 

Patients and Providers 

PART I—ENSURING BENEFICIARY ACCESS TO 

PHYSICIAN CARE AND OTHER SERVICES 

SEC. 3101. INCREASE IN THE PHYSICIAN PAYMENT UPDATE. 

Section 1848(d) of the Social Security Act (42 U.S.C. 1395w– 

4(d)) is amended by adding at the end the following new paragraph: 

‘‘(10) UPDATE FOR 2010.— 

‘‘(A) IN GENERAL.—Subject to paragraphs (7)(B), (8)(B), 

and (9)(B), in lieu of the update to the single conversion 

factor established in paragraph (1)(C) that would otherwise 

apply for 2010, the update to the single conversion factor 

shall be 0.5 percent. 

‘‘(B) NO EFFECT ON COMPUTATION OF CONVERSION

FACTOR FOR 2011 AND SUBSEQUENT YEARS.—The conversion 

factor under this subsection shall be computed under paragraph (1)(A) for 2011 and subsequent years as if subparagraph (A) had never applied.’’. 
H. R. 3590—298 

SEC. 3102. EXTENSION OF THE WORK GEOGRAPHIC INDEX FLOOR AND 

REVISIONS TO THE PRACTICE EXPENSE GEOGRAPHIC 

ADJUSTMENT UNDER THE MEDICARE PHYSICIAN FEE 

SCHEDULE. 

(a) EXTENSION OF WORK GPCI FLOOR.—Section 1848(e)(1)(E) 

of the Social Security Act (42 U.S.C. 1395w–4(e)(1)(E)) is amended 

by striking ‘‘before January 1, 2010’’ and inserting ‘‘before January 

1, 2011’’. 

(b) PRACTICE EXPENSE GEOGRAPHIC ADJUSTMENT FOR 2010 AND

SUBSEQUENT YEARS.—Section 1848(e)(1) of the Social Security Act 

(42 U.S.C. 1395w4(e)(1)) is amended— 

(1) in subparagraph (A), by striking ‘‘and (G)’’ and inserting 

‘‘(G), and (H)’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(H) PRACTICE EXPENSE GEOGRAPHIC ADJUSTMENT FOR

2010 AND SUBSEQUENT YEARS.— 

‘‘(i) FOR 2010.—Subject to clause (iii), for services 

furnished during 2010, the employee wage and rent 

portions of the practice expense geographic index 

described in subparagraph (A)(i) shall reflect 3⁄4 of 

the difference between the relative costs of employee 

wages and rents in each of the different fee schedule 

areas and the national average of such employee wages 

and rents. 

‘‘(ii) FOR 2011.—Subject to clause (iii), for services 

furnished during 2011, the employee wage and rent 

portions of the practice expense geographic index 

described in subparagraph (A)(i) shall reflect 1⁄2 of 

the difference between the relative costs of employee 

wages and rents in each of the different fee schedule 

areas and the national average of such employee wages 

and rents. 

‘‘(iii) HOLD HARMLESS.—The practice expense portion of the geographic adjustment factor applied in 

a fee schedule area for services furnished in 2010 or 

2011 shall not, as a result of the application of clause 

(i) or (ii), be reduced below the practice expense portion 

of the geographic adjustment factor under subparagraph (A)(i) (as calculated prior to the application of 

such clause (i) or (ii), respectively) for such area for 

such year. 

‘‘(iv) ANALYSIS.—The Secretary shall analyze current methods of establishing practice expense 

geographic adjustments under subparagraph (A)(i) and 

evaluate data that fairly and reliably establishes 

distinctions in the costs of operating a medical practice 

in the different fee schedule areas. Such analysis shall 

include an evaluation of the following: 

‘‘(I) The feasibility of using actual data or reliable survey data developed by medical organizations on the costs of operating a medical practice, 

including office rents and non-physician staff 

wages, in different fee schedule areas. 

‘‘(II) The office expense portion of the practice 

expense geographic adjustment described in 

subparagraph (A)(i), including the extent to which 
H. R. 3590—299 

types of office expenses are determined in local 

markets instead of national markets. 

‘‘(III) The weights assigned to each of the categories within the practice expense geographic 

adjustment described in subparagraph (A)(i). 

‘‘(v) REVISION FOR 2012 AND SUBSEQUENT YEARS.— As a result of the analysis described in clause (iv), 

the Secretary shall, not later than January 1, 2012, 

make appropriate adjustments to the practice expense 

geographic adjustment described in subparagraph 

(A)(i) to ensure accurate geographic adjustments across 

fee schedule areas, including— 

‘‘(I) basing the office rents component and its 

weight on office expenses that vary among fee 

schedule areas; and 

‘‘(II) considering a representative range of 

professional and non-professional personnel 

employed in a medical office based on the use 

of the American Community Survey data or other 

reliable data for wage adjustments. 

Such adjustments shall be made without regard to 

adjustments made pursuant to clauses (i) and (ii) and 

shall be made in a budget neutral manner.’’. 

SEC. 3103. EXTENSION OF EXCEPTIONS PROCESS FOR MEDICARE 

THERAPY CAPS. 

Section 1833(g)(5) of the Social Security Act (42 U.S.C. 

1395l(g)(5)) is amended by striking ‘‘December 31, 2009’’ and 

inserting ‘‘December 31, 2010’’. 

SEC. 3104. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF 

CERTAIN PHYSICIAN PATHOLOGY SERVICES. 

Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits 

Improvement and Protection Act of 2000 (as enacted into law by 

section 1(a)(6) of Public Law 106–554), as amended by section 

732 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (42 U.S.C. 1395w–4 note), section 104 of 

division B of the Tax Relief and Health Care Act of 2006 (42 

U.S.C. 1395w–4 note), section 104 of the Medicare, Medicaid, and 

SCHIP Extension Act of 2007 (Public Law 110–173), and section 

136 of the Medicare Improvements for Patients and Providers Act 

of 2008 (Public Law 110–275), is amended by striking ‘‘and 2009’’ 

and inserting ‘‘2009, and 2010’’. 

SEC. 3105. EXTENSION OF AMBULANCE ADD-ONS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended— 

(1) in the matter preceding clause (i)— 

(A) by striking ‘‘2007, and for’’ and inserting ‘‘2007, 

for’’; and 

(B) by striking ‘‘2010’’ and inserting ‘‘2010, and for 

such services furnished on or after April 1, 2010, and 

before January 1, 2011,’’; and 

(2) in each of clauses (i) and (ii), by inserting ‘‘, and on 

or after April 1, 2010, and before January 1, 2011’’ after 

‘‘January 1, 2010’’ each place it appears. 

(b) AIR AMBULANCE.—Section 146(b)(1) of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 
H. R. 3590—300 

110–275) is amended by striking ‘‘December 31, 2009’’ and inserting 

‘‘December 31, 2009, and during the period beginning on April 

1, 2010, and ending on January 1, 2011’’. 

(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 

Social Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended by 

striking ‘‘2010’’ and inserting ‘‘2010, and on or after April 1, 2010, 

and before January 1, 2011’’. 

SEC. 3106. EXTENSION OF CERTAIN PAYMENT RULES FOR LONG-TERM 

CARE HOSPITAL SERVICES AND OF MORATORIUM ON 

THE ESTABLISHMENT OF CERTAIN HOSPITALS AND 

FACILITIES. 

(a) EXTENSION OF CERTAIN PAYMENT RULES.—Section 114(c) 

of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 

U.S.C. 1395ww note), as amended by section 4302(a) of the American Recovery and Reinvestment Act (Public Law 111–5), is further 

amended by striking ‘‘3-year period’’ each place it appears and 

inserting ‘‘4-year period’’. 

(b) EXTENSION OF MORATORIUM.—Section 114(d)(1) of such Act 

(42 U.S.C. 1395ww note), in the matter preceding subparagraph 

(A), is amended by striking ‘‘3-year period’’ and inserting ‘‘4-year 

period’’. 

SEC. 3107. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH 

ADD-ON. 

Section 138(a)(1) of the Medicare Improvements for Patients 

and Providers Act of 2008 (Public Law 110–275) is amended by 

striking ‘‘December 31, 2009’’ and inserting ‘‘December 31, 2010’’. 

SEC. 3108. PERMITTING PHYSICIAN ASSISTANTS TO ORDER POST-HOSPITAL EXTENDED CARE SERVICES. 

(a) ORDERING POST-HOSPITAL EXTENDED CARE SERVICES.— 

(1) IN GENERAL.—Section 1814(a)(2) of the Social Security 

Act (42 U.S.C. 1395f(a)(2)), in the matter preceding subparagraph (A), is amended by striking ‘‘or clinical nurse specialist’’ 

and inserting ‘‘, a clinical nurse specialist, or a physician assistant (as those terms are defined in section 1861(aa)(5))’’ after 

‘‘nurse practitioner’’. 

(2) CONFORMING AMENDMENT.—Section 1814(a) of the 

Social Security Act (42 U.S.C. 1395f(a)) is amended, in the 

second sentence, by striking ‘‘or clinical nurse specialist’’ and 

inserting ‘‘clinical nurse specialist, or physician assistant’’ after 

‘‘nurse practitioner,’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to items and services furnished on or after January 

1, 2011. 

SEC. 3109. EXEMPTION OF CERTAIN PHARMACIES FROM ACCREDITATION REQUIREMENTS. 

(a) IN GENERAL.—Section 1834(a)(20) of the Social Security 

Act (42 U.S.C. 1395m(a)(20)), as added by section 154(b)(1)(A) of 

the Medicare Improvements for Patients and Providers Act of 2008 

(Public Law 100–275), is amended— 

(1) in subparagraph (F)(i)— 

(A) by inserting ‘‘and subparagraph (G)’’ after ‘‘clause 

(ii)’’; and 

(B) by inserting ‘‘, except that the Secretary shall not 

require a pharmacy to have submitted to the Secretary 
H. R. 3590—301 

such evidence of accreditation prior to January 1, 2011’’ 

before the semicolon at the end; and 

(2) by adding at the end the following new subparagraph: 

‘‘(G) APPLICATION OF ACCREDITATION REQUIREMENT TO

CERTAIN PHARMACIES.— 

‘‘(i) IN GENERAL.—With respect to items and services furnished on or after January 1, 2011, in implementing quality standards under this paragraph— 

‘‘(I) subject to subclause (II), in applying such 

standards and the accreditation requirement of 

subparagraph (F)(i) with respect to pharmacies 

described in clause (ii) furnishing such items and 

services, such standards and accreditation requirement shall not apply to such pharmacies; and 

‘‘(II) the Secretary may apply to such pharmacies an alternative accreditation requirement 

established by the Secretary if the Secretary determines such alternative accreditation requirement 

is more appropriate for such pharmacies. 

‘‘(ii) PHARMACIES DESCRIBED.—A pharmacy 

described in this clause is a pharmacy that meets 

each of the following criteria: 

‘‘(I) The total billings by the pharmacy for 

such items and services under this title are less 

than 5 percent of total pharmacy sales, as determined based on the average total pharmacy sales 

for the previous 3 calendar years, 3 fiscal years, 

or other yearly period specified by the Secretary. 

‘‘(II) The pharmacy has been enrolled under 

section 1866(j) as a supplier of durable medical 

equipment, prosthetics, orthotics, and supplies, has 

been issued (which may include the renewal of) 

a provider number for at least 5 years, and for 

which a final adverse action (as defined in section 

424.57(a) of title 42, Code of Federal Regulations) 

has not been imposed in the past 5 years. 

‘‘(III) The pharmacy submits to the Secretary 

an attestation, in a form and manner, and at a 

time, specified by the Secretary, that the pharmacy 

meets the criteria described in subclauses (I) and 

(II). Such attestation shall be subject to section 

1001 of title 18, United States Code. 

‘‘(IV) The pharmacy agrees to submit materials 

as requested by the Secretary, or during the course 

of an audit conducted on a random sample of pharmacies selected annually, to verify that the pharmacy meets the criteria described in subclauses 

(I) and (II). Materials submitted under the preceding sentence shall include a certification by an 

accountant on behalf of the pharmacy or the 

submission of tax returns filed by the pharmacy 

during the relevant periods, as requested by the 

Secretary.’’. 

(b) ADMINISTRATION.—Notwithstanding any other provision of 

law, the Secretary may implement the amendments made by subsection (a) by program instruction or otherwise. 
H. R. 3590—302 

(c) RULE OF CONSTRUCTION.—Nothing in the provisions of or 

amendments made by this section shall be construed as affecting 

the application of an accreditation requirement for pharmacies to 

qualify for bidding in a competitive acquisition area under section 

1847 of the Social Security Act (42 U.S.C. 1395w–3). 

SEC. 3110. PART B SPECIAL ENROLLMENT PERIOD FOR DISABLED 

TRICARE BENEFICIARIES. 

(a) IN GENERAL.— 

(1) IN GENERAL.—Section 1837 of the Social Security Act 

(42 U.S.C. 1395p) is amended by adding at the end the following 

new subsection: 

‘‘(l)(1) In the case of any individual who is a covered beneficiary 

(as defined in section 1072(5) of title 10, United States Code) 

at the time the individual is entitled to part A under section 

226(b) or section 226A and who is eligible to enroll but who has 

elected not to enroll (or to be deemed enrolled) during the individual’s initial enrollment period, there shall be a special enrollment 

period described in paragraph (2). 

‘‘(2) The special enrollment period described in this paragraph, 

with respect to an individual, is the 12-month period beginning 

on the day after the last day of the initial enrollment period of 

the individual or, if later, the 12-month period beginning with 

the month the individual is notified of enrollment under this section. 

‘‘(3) In the case of an individual who enrolls during the special 

enrollment period provided under paragraph (1), the coverage period 

under this part shall begin on the first day of the month in which 

the individual enrolls, or, at the option of the individual, the first 

month after the end of the individual’s initial enrollment period. 

‘‘(4) An individual may only enroll during the special enrollment 

period provided under paragraph (1) one time during the individual’s lifetime. 

‘‘(5) The Secretary shall ensure that the materials relating 

to coverage under this part that are provided to an individual 

described in paragraph (1) prior to the individual’s initial enrollment 

period contain information concerning the impact of not enrolling 

under this part, including the impact on health care benefits under 

the TRICARE program under chapter 55 of title 10, United States 

Code. 

‘‘(6) The Secretary of Defense shall collaborate with the Secretary of Health and Human Services and the Commissioner of 

Social Security to provide for the accurate identification of individuals described in paragraph (1). The Secretary of Defense shall 

provide such individuals with notification with respect to this subsection. The Secretary of Defense shall collaborate with the Secretary of Health and Human Services and the Commissioner of 

Social Security to ensure appropriate follow up pursuant to any 

notification provided under the preceding sentence.’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply to elections made with respect to initial enrollment periods that end after the date of the enactment of this 

Act. 

(b) WAIVER OF INCREASE OF PREMIUM.—Section 1839(b) of the 

Social Security Act (42 U.S.C. 1395r(b)) is amended by striking 

‘‘section 1837(i)(4)’’ and inserting ‘‘subsection (i)(4) or (l) of section 

1837’’. 
H. R. 3590—303 

SEC. 3111. PAYMENT FOR BONE DENSITY TESTS. 

(a) PAYMENT.— 

(1) IN GENERAL.—Section 1848 of the Social Security Act 

(42 U.S.C. 1395w–4) is amended— 

(A) in subsection (b)— 

(i) in paragraph (4)(B), by inserting ‘‘, and for 

2010 and 2011, dual-energy x-ray absorptiometry services (as described in paragraph (6))’’ before the period 

at the end; and 

(ii) by adding at the end the following new paragraph: 

‘‘(6) TREATMENT OF BONE MASS SCANS.—For dual-energy 

x-ray absorptiometry services (identified in 2006 by HCPCS 

codes 76075 and 76077 (and any succeeding codes)) furnished 

during 2010 and 2011, instead of the payment amount that 

would otherwise be determined under this section for such 

years, the payment amount shall be equal to 70 percent of 

the product of— 

‘‘(A) the relative value for the service (as determined 

in subsection (c)(2)) for 2006; 

‘‘(B) the conversion factor (established under subsection 

(d)) for 2006; and 

‘‘(C) the geographic adjustment factor (established 

under subsection (e)(2)) for the service for the fee schedule 

area for 2010 and 2011, respectively.’’; and 

(B) in subsection (c)(2)(B)(iv)— 

(i) in subclause (II), by striking ‘‘and’’ at the end; 

(ii) in subclause (III), by striking the period at 

the end and inserting ‘‘; and’’; and 

(iii) by adding at the end the following new subclause: 

‘‘(IV) subsection (b)(6) shall not be taken into 

account in applying clause (ii)(II) for 2010 or 

2011.’’. 

(2) IMPLEMENTATION.—Notwithstanding any other provision of law, the Secretary may implement the amendments 

made by paragraph (1) by program instruction or otherwise. 

(b) STUDY AND REPORT BY THE INSTITUTE OF MEDICINE.— 

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

Services is authorized to enter into an agreement with the 

Institute of Medicine of the National Academies to conduct 

a study on the ramifications of Medicare payment reductions 

for dual-energy x-ray absorptiometry (as described in section 

1848(b)(6) of the Social Security Act, as added by subsection 

(a)(1)) during 2007, 2008, and 2009 on beneficiary access to 

bone mass density tests. 

(2) REPORT.—An agreement entered into under paragraph 

(1) shall provide for the Institute of Medicine to submit to 

the Secretary and to Congress a report containing the results 

of the study conducted under such paragraph. 

SEC. 3112. REVISION TO THE MEDICARE IMPROVEMENT FUND. 

Section 1898(b)(1)(A) of the Social Security Act (42 U.S.C. 

1395iii) is amended by striking ‘‘$22,290,000,000’’ and inserting 

‘‘$0’’. 
H. R. 3590—304 

SEC. 3113. TREATMENT OF CERTAIN COMPLEX DIAGNOSTIC LABORATORY TESTS. 

(a) DEMONSTRATION PROJECT.— 

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

Services (in this section referred to as the ‘‘Secretary’’) shall 

conduct a demonstration project under part B title XVIII of 

the Social Security Act under which separate payments are 

made under such part for complex diagnostic laboratory tests 

provided to individuals under such part. Under the demonstration project, the Secretary shall establish appropriate payment 

rates for such tests. 

(2) COVERED COMPLEX DIAGNOSTIC LABORATORY TEST

DEFINED.—In this section, the term ‘‘complex diagnostic laboratory test’’ means a diagnostic laboratory test— 

(A) that is an analysis of gene protein expression, 

topographic genotyping, or a cancer chemotherapy sensitivity assay; 

(B) that is determined by the Secretary to be a laboratory test for which there is not an alternative test having 

equivalent performance characteristics; 

(C) which is billed using a Health Care Procedure 

Coding System (HCPCS) code other than a not otherwise 

classified code under such Coding System; 

(D) which is approved or cleared by the Food and 

Drug Administration or is covered under title XVIII of 

the Social Security Act; and 

(E) is described in section 1861(s)(3) of the Social Security Act (42 U.S.C. 1395x(s)(3)). 

(3) SEPARATE PAYMENT DEFINED.—In this section, the term 

‘‘separate payment’’ means direct payment to a laboratory 

(including a hospital-based or independent laboratory) that performs a complex diagnostic laboratory test with respect to a 

specimen collected from an individual during a period in which 

the individual is a patient of a hospital if the test is performed 

after such period of hospitalization and if separate payment 

would not otherwise be made under title XVIII of the Social 

Security Act by reason of sections 1862(a)(14) and 

1866(a)(1)(H)(i) of the such Act (42 U.S.C. 1395y(a)(14); 42 

U.S.C. 1395cc(a)(1)(H)(i)). 

(b) DURATION.—Subject to subsection (c)(2), the Secretary shall 

conduct the demonstration project under this section for the 2- 

year period beginning on July 1, 2011. 

(c) PAYMENTS AND LIMITATION.—Payments under the demonstration project under this section shall— 

(1) be made from the Federal Supplemental Medical Insurance Trust Fund under section 1841 of the Social Security 

Act (42 U.S.C. 1395t); and 

(2) may not exceed $100,000,000. 

(d) REPORT.—Not later than 2 years after the completion of 

the demonstration project under this section, the Secretary shall 

submit to Congress a report on the project. Such report shall 

include— 

(1) an assessment of the impact of the demonstration 

project on access to care, quality of care, health outcomes, 

and expenditures under title XVIII of the Social Security Act 

(including any savings under such title); and 
H. R. 3590—305 

(2) such recommendations as the Secretary determines 

appropriate. 

(e) IMPLEMENTATION FUNDING.—For purposes of administering 

this section (including preparing and submitting the report under 

subsection (d)), the Secretary shall provide for the transfer, from 

the Federal Supplemental Medical Insurance Trust Fund under 

section 1841 of the Social Security Act (42 U.S.C. 1395t), to the 

Centers for Medicare & Medicaid Services Program Management 

Account, of $5,000,000. Amounts transferred under the preceding 

sentence shall remain available until expended. 

SEC. 3114. IMPROVED ACCESS FOR CERTIFIED NURSE-MIDWIFE SERVICES. 

Section 1833(a)(1)(K) of the Social Security Act (42 U.S.C. 

1395l(a)(1)(K)) is amended by inserting ‘‘(or 100 percent for services 

furnished on or after January 1, 2011)’’ after ‘‘1992, 65 percent’’. 

PART II—RURAL PROTECTIONS 

SEC. 3121. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION. 

(a) IN GENERAL.—Section 1833(t)(7)(D)(i) of the Social Security 

Act (42 U.S.C. 1395l(t)(7)(D)(i)) is amended— 

(1) in subclause (II)— 

(A) in the first sentence, by striking ‘‘2010’’and 

inserting ‘‘2011’’; and 

(B) in the second sentence, by striking ‘‘or 2009’’ and 

inserting ‘‘, 2009, or 2010’’; and 

(2) in subclause (III), by striking ‘‘January 1, 2010’’ and 

inserting ‘‘January 1, 2011’’. 

(b) PERMITTING ALL SOLE COMMUNITY HOSPITALS TO BE

ELIGIBLE FOR HOLD HARMLESS.—Section 1833(t)(7)(D)(i)(III) of the 

Social Security Act (42 U.S.C. 1395l(t)(7)(D)(i)(III)) is amended by 

adding at the end the following new sentence: ‘‘In the case of 

covered OPD services furnished on or after January 1, 2010, and 

before January 1, 2011, the preceding sentence shall be applied 

without regard to the 100-bed limitation.’’. 

SEC. 3122. EXTENSION OF MEDICARE REASONABLE COSTS PAYMENTS 

FOR CERTAIN CLINICAL DIAGNOSTIC LABORATORY 

TESTS FURNISHED TO HOSPITAL PATIENTS IN CERTAIN 

RURAL AREAS. 

Section 416(b) of the Medicare Prescription Drug, Improvement, 

and Modernization Act of 2003 (42 U.S.C. 1395l–4), as amended 

by section 105 of division B of the Tax Relief and Health Care 

Act of 2006 (42 U.S.C. 1395l note) and section 107 of the Medicare, 

Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395l note), 

is amended by inserting ‘‘or during the 1-year period beginning 

on July 1, 2010’’ before the period at the end. 

SEC. 3123. EXTENSION OF THE RURAL COMMUNITY HOSPITAL DEMONSTRATION PROGRAM. 

(a) ONE-YEAR EXTENSION.—Section 410A of the Medicare 

Prescription Drug, Improvement, and Modernization Act of 2003 

(Public Law 108–173; 117 Stat. 2272) is amended by adding at 

the end the following new subsection: 

‘‘(g) ONE-YEAR EXTENSION OF DEMONSTRATION PROGRAM.— 

‘‘(1) IN GENERAL.—Subject to the succeeding provisions of 

this subsection, the Secretary shall conduct the demonstration 
H. R. 3590—306 

program under this section for an additional 1-year period 

(in this section referred to as the ‘1-year extension period’) 

that begins on the date immediately following the last day 

of the initial 5-year period under subsection (a)(5). 

‘‘(2) EXPANSION OF DEMONSTRATION STATES.—Notwithstanding subsection (a)(2), during the 1-year extension period, 

the Secretary shall expand the number of States with low 

population densities determined by the Secretary under such 

subsection to 20. In determining which States to include in 

such expansion, the Secretary shall use the same criteria and 

data that the Secretary used to determine the States under 

such subsection for purposes of the initial 5-year period. 

‘‘(3) INCREASE IN MAXIMUM NUMBER OF HOSPITALS PARTICIPATING IN THE DEMONSTRATION PROGRAM.—Notwithstanding 

subsection (a)(4), during the 1-year extension period, not more 

than 30 rural community hospitals may participate in the demonstration program under this section. 

‘‘(4) NO AFFECT ON HOSPITALS IN DEMONSTRATION PROGRAM

ON DATE OF ENACTMENT.—In the case of a rural community 

hospital that is participating in the demonstration program 

under this section as of the last day of the initial 5-year 

period, the Secretary shall provide for the continued participation of such rural community hospital in the demonstration 

program during the 1-year extension period unless the rural 

community hospital makes an election, in such form and 

manner as the Secretary may specify, to discontinue such 

participation.’’. 

(b) CONFORMING AMENDMENTS.—Subsection (a)(5) of section 

410A of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2272) is 

amended by inserting ‘‘(in this section referred to as the ‘initial 

5-year period’) and, as provided in subsection (g), for the 1-year 

extension period’’ after ‘‘5-year period’’. 

(c) TECHNICAL AMENDMENTS.— (1) Subsection (b) of section 410A of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public 

Law 108–173; 117 Stat. 2272) is amended— 

(A) in paragraph (1)(B)(ii), by striking ‘‘2)’’ and 

inserting ‘‘2))’’; and 

(B) in paragraph (2), by inserting ‘‘cost’’ before 

‘‘reporting period’’ the first place such term appears in 

each of subparagraphs (A) and (B). 

(2) Subsection (f)(1) of section 410A of the Medicare 

Prescription Drug, Improvement, and Modernization Act of 

2003 (Public Law 108–173; 117 Stat. 2272) is amended— 

(A) in subparagraph (A)(ii), by striking ‘‘paragraph (2)’’ 

and inserting ‘‘subparagraph (B)’’; and 

(B) in subparagraph (B), by striking ‘‘paragraph (1)(B)’’ 

and inserting ‘‘subparagraph (A)(ii)’’. 

SEC. 3124. EXTENSION OF THE MEDICARE-DEPENDENT HOSPITAL 

(MDH) PROGRAM. 

(a) EXTENSION OF PAYMENT METHODOLOGY.—Section 

1886(d)(5)(G) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(G)) 

is amended— 

(1) in clause (i), by striking ‘‘October 1, 2011’’ and inserting 

‘‘October 1, 2012’’; and 
H. R. 3590—307 

(2) in clause (ii)(II), by striking ‘‘October 1, 2011’’ and 

inserting ‘‘October 1, 2012’’. 

(b) CONFORMING AMENDMENTS.— 

(1) EXTENSION OF TARGET AMOUNT.—Section 1886(b)(3)(D) 

of the Social Security Act (42 U.S.C. 1395ww(b)(3)(D)) is 

amended— 

(A) in the matter preceding clause (i), by striking 

‘‘October 1, 2011’’ and inserting ‘‘October 1, 2012’’; and 

(B) in clause (iv), by striking ‘‘through fiscal year 2011’’ 

and inserting ‘‘through fiscal year 2012’’. 

(2) PERMITTING HOSPITALS TO DECLINE RECLASSIFICATION.— Section 13501(e)(2) of the Omnibus Budget Reconciliation Act 

of 1993 (42 U.S.C. 1395ww note) is amended by striking 

‘‘through fiscal year 2011’’ and inserting ‘‘through fiscal year 

2012’’. 

SEC. 3125. TEMPORARY IMPROVEMENTS TO THE MEDICARE 

INPATIENT HOSPITAL PAYMENT ADJUSTMENT FOR LOWVOLUME HOSPITALS. 

Section 1886(d)(12) of the Social Security Act (42 U.S.C. 

1395ww(d)(12)) is amended— 

(1) in subparagraph (A), by inserting ‘‘or (D)’’ after 

‘‘subparagraph (B)’’; 

(2) in subparagraph (B), in the matter preceding clause 

(i), by striking ‘‘The Secretary’’ and inserting ‘‘For discharges 

occurring in fiscal years 2005 through 2010 and for discharges 

occurring in fiscal year 2013 and subsequent fiscal years, the 

Secretary’’; 

(3) in subparagraph (C)(i)— 

(A) by inserting ‘‘(or, with respect to fiscal years 2011 

and 2012, 15 road miles)’’ after ‘‘25 road miles’’; and 

(B) by inserting ‘‘(or, with respect to fiscal years 2011 

and 2012, 1,500 discharges of individuals entitled to, or 

enrolled for, benefits under part A)’’ after ‘‘800 discharges’’; 

and 

(4) by adding at the end the following new subparagraph: 

‘‘(D) TEMPORARY APPLICABLE PERCENTAGE INCREASE.— For discharges occurring in fiscal years 2011 and 2012, 

the Secretary shall determine an applicable percentage 

increase for purposes of subparagraph (A) using a continuous linear sliding scale ranging from 25 percent for lowvolume hospitals with 200 or fewer discharges of individuals entitled to, or enrolled for, benefits under part A 

in the fiscal year to 0 percent for low-volume hospitals 

with greater than 1,500 discharges of such individuals 

in the fiscal year.’’. 

SEC. 3126. IMPROVEMENTS TO THE DEMONSTRATION PROJECT ON 

COMMUNITY HEALTH INTEGRATION MODELS IN CERTAIN 

RURAL COUNTIES. 

(a) REMOVAL OF LIMITATION ON NUMBER OF ELIGIBLE COUNTIES

SELECTED.—Subsection (d)(3) of section 123 of the Medicare 

Improvements for Patients and Providers Act of 2008 (42 U.S.C. 

1395i–4 note) is amended by striking ‘‘not more than 6’’. 

(b) REMOVAL OF REFERENCES TO RURAL HEALTH CLINIC SERVICES AND INCLUSION OF PHYSICIANS’ SERVICES IN SCOPE OF DEM- ONSTRATION PROJECT.—Such section 123 is amended— 
H. R. 3590—308 

(1) in subsection (d)(4)(B)(i)(3), by striking subclause (III); 

and 

(2) in subsection (j)— 

(A) in paragraph (8), by striking subparagraph (B) 

and inserting the following: 

‘‘(B) Physicians’ services (as defined in section 1861(q) 

of the Social Security Act (42 U.S.C. 1395x(q)).’’; 

(B) by striking paragraph (9); and 

(C) by redesignating paragraph (10) as paragraph (9). 

SEC. 3127. MEDPAC STUDY ON ADEQUACY OF MEDICARE PAYMENTS 

FOR HEALTH CARE PROVIDERS SERVING IN RURAL 

AREAS. 

(a) STUDY.—The Medicare Payment Advisory Commission shall 

conduct a study on the adequacy of payments for items and services 

furnished by providers of services and suppliers in rural areas 

under the Medicare program under title XVIII of the Social Security 

Act (42 U.S.C. 1395 et seq.). Such study shall include an analysis 

of— 

(1) any adjustments in payments to providers of services 

and suppliers that furnish items and services in rural areas; 

(2) access by Medicare beneficiaries to items and services 

in rural areas; 

(3) the adequacy of payments to providers of services and 

suppliers that furnish items and services in rural areas; and 

(4) the quality of care furnished in rural areas. 

(b) REPORT.—Not later than January 1, 2011, the Medicare 

Payment Advisory Commission shall submit to Congress a report 

containing the results of the study conducted under subsection 

(a). Such report shall include recommendations on appropriate modifications to any adjustments in payments to providers of services 

and suppliers that furnish items and services in rural areas, 

together with recommendations for such legislation and administrative action as the Medicare Payment Advisory Commission determines appropriate. 

SEC. 3128. TECHNICAL CORRECTION RELATED TO CRITICAL ACCESS 

HOSPITAL SERVICES. 

(a) IN GENERAL.—Subsections (g)(2)(A) and (l)(8) of section 1834 

of the Social Security Act (42 U.S.C. 1395m) are each amended 

by inserting ‘‘101 percent of’’ before ‘‘the reasonable costs’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall take effect as if included in the enactment of section 

405(a) of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2266). 

SEC. 3129. EXTENSION OF AND REVISIONS TO MEDICARE RURAL HOSPITAL FLEXIBILITY PROGRAM. 

(a) AUTHORIZATION.—Section 1820(j) of the Social Security Act 

(42 U.S.C. 1395i–4(j)) is amended— 

(1) by striking ‘‘2010, and for’’ and inserting ‘‘2010, for’’; 

and 

(2) by inserting ‘‘and for making grants to all States under 

subsection (g), such sums as may be necessary in each of 

fiscal years 2011 and 2012, to remain available until expended’’ 

before the period at the end. 

(b) USE OF FUNDS.—Section 1820(g)(3) of the Social Security 

Act (42 U.S.C. 1395i–4(g)(3)) is amended— 
H. R. 3590—309 

(1) in subparagraph (A), by inserting ‘‘and to assist such 

hospitals in participating in delivery system reforms under 

the provisions of and amendments made by the Patient Protection and Affordable Care Act, such as value-based purchasing 

programs, accountable care organizations under section 1899, 

the National pilot program on payment bundling under section 

1866D, and other delivery system reform programs determined 

appropriate by the Secretary’’ before the period at the end; 

and 

(2) in subparagraph (E)— 

(A) by striking ‘‘, and to offset’’ and inserting ‘‘, to 

offset’’; and 

(B) by inserting ‘‘and to participate in delivery system 

reforms under the provisions of and amendments made 

by the Patient Protection and Affordable Care Act, such 

as value-based purchasing programs, accountable care 

organizations under section 1899, the National pilot program on payment bundling under section 1866D, and other 

delivery system reform programs determined appropriate 

by the Secretary’’ before the period at the end. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to grants made on or after January 1, 2010. 

PART III—IMPROVING PAYMENT ACCURACY 

SEC. 3131. PAYMENT ADJUSTMENTS FOR HOME HEALTH CARE. 

(a) REBASING HOME HEALTH PROSPECTIVE PAYMENT AMOUNT.— 

(1) IN GENERAL.—Section 1895(b)(3)(A) of the Social Security Act (42 U.S.C. 1395fff(b)(3)(A)) is amended— 

(A) in clause (i)(III), by striking ‘‘For periods’’ and 

inserting ‘‘Subject to clause (iii), for periods’’; and 

(B) by adding at the end the following new clause: 

‘‘(iii) ADJUSTMENT FOR 2013 AND SUBSEQUENT

YEARS.— 

‘‘(I) IN GENERAL.—Subject to subclause (II), 

for 2013 and subsequent years, the amount (or 

amounts) that would otherwise be applicable under 

clause (i)(III) shall be adjusted by a percentage 

determined appropriate by the Secretary to reflect 

such factors as changes in the number of visits 

in an episode, the mix of services in an episode, 

the level of intensity of services in an episode, 

the average cost of providing care per episode, 

and other factors that the Secretary considers to 

be relevant. In conducting the analysis under the 

preceding sentence, the Secretary may consider 

differences between hospital-based and freestanding agencies, between for-profit and nonprofit 

agencies, and between the resource costs of urban 

and rural agencies. Such adjustment shall be made 

before the update under subparagraph (B) is 

applied for the year. 

‘‘(II) TRANSITION.—The Secretary shall provide 

for a 4-year phase-in (in equal increments) of the 

adjustment under subclause (I), with such adjustment being fully implemented for 2016. During 

each year of such phase-in, the amount of any 
H. R. 3590—310 

adjustment under subclause (I) for the year may 

not exceed 3.5 percent of the amount (or amounts) 

applicable under clause (i)(III) as of the date of 

enactment of the Patient Protection and Affordable 

Care Act.’’. 

(2) MEDPAC STUDY AND REPORT.— 

(A) STUDY.—The Medicare Payment Advisory Commission shall conduct a study on the implementation of the 

amendments made by paragraph (1). Such study shall 

include an analysis of the impact of such amendments 

on— 

(i) access to care; 

(ii) quality outcomes; 

(iii) the number of home health agencies; and 

(iv) rural agencies, urban agencies, for-profit agencies, and nonprofit agencies. 

(B) REPORT.—Not later than January 1, 2015, the 

Medicare Payment Advisory Commission shall submit to 

Congress a report on the study conducted under subparagraph (A), together with recommendations for such legislation and administrative action as the Commission determines appropriate. 

(b) PROGRAM-SPECIFIC OUTLIER CAP.—Section 1895(b) of the 

Social Security Act (42 U.S.C. 1395fff(b)) is amended— 

(1) in paragraph (3)(C), by striking ‘‘the aggregate’’ and 

all that follows through the period at the end and inserting 

‘‘5 percent of the total payments estimated to be made based 

on the prospective payment system under this subsection for 

the period.’’; and 

(2) in paragraph (5)— 

(A) by striking ‘‘OUTLIERS.—The Secretary’’ and 

inserting the following: ‘‘OUTLIERS.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

Secretary’’; 

(B) in subparagraph (A), as added by subparagraph 

(A), by striking ‘‘5 percent’’ and inserting ‘‘2.5 percent’’; 

and 

(C) by adding at the end the following new subparagraph: 

‘‘(B) PROGRAM SPECIFIC OUTLIER CAP.—The estimated 

total amount of additional payments or payment adjustments made under subparagraph (A) with respect to a 

home health agency for a year (beginning with 2011) may 

not exceed an amount equal to 10 percent of the estimated 

total amount of payments made under this section (without 

regard to this paragraph) with respect to the home health 

agency for the year.’’. 

(c) APPLICATION OF THE MEDICARE RURAL HOME HEALTH ADDON POLICY.—Section 421 of the Medicare Prescription Drug, 

Improvement, and Modernization Act of 2003 (Public Law 108– 

173; 117 Stat. 2283), as amended by section 5201(b) of the Deficit 

Reduction Act of 2005 (Public Law 109–171; 120 Stat. 46), is 

amended— 

(1) in the section heading, by striking ‘‘ONE-YEAR’’ and 

inserting ‘‘TEMPORARY’’; and 

(2) in subsection (a)— 
H. R. 3590—311 

(A) by striking ‘‘, and episodes’’ and inserting ‘‘, episodes’’; 

(B) by inserting ‘‘and episodes and visits ending on 

or after April 1, 2010, and before January 1, 2016,’’ after 

‘‘January 1, 2007,’’; and 

(C) by inserting ‘‘(or, in the case of episodes and visits 

ending on or after April 1, 2010, and before January 1, 

2016, 3 percent)’’ before the period at the end. 

(d) STUDY AND REPORT ON THE DEVELOPMENT OF HOME HEALTH

PAYMENT REFORMS IN ORDER TO ENSURE ACCESS TO CARE AND

QUALITY SERVICES.— 

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

Services (in this section referred to as the ‘‘Secretary’’) shall 

conduct a study to evaluate the costs and quality of care among 

efficient home health agencies relative to other such agencies 

in providing ongoing access to care and in treating Medicare 

beneficiaries with varying severity levels of illness. Such study 

shall include an analysis of the following: 

(A) Methods to revise the home health prospective 

payment system under section 1895 of the Social Security 

Act (42 U.S.C. 1395fff) to more accurately account for the 

costs related to patient severity of illness or to improving 

beneficiary access to care, including— 

(i) payment adjustments for services that may be 

under- or over-valued; 

(ii) necessary changes to reflect the resource use 

relative to providing home health services to lowincome Medicare beneficiaries or Medicare beneficiaries living in medically underserved areas; 

(iii) ways the outlier payment may be improved 

to more accurately reflect the cost of treating Medicare 

beneficiaries with high severity levels of illness; 

(iv) the role of quality of care incentives and penalties in driving provider and patient behavior; 

(v) improvements in the application of a wage 

index; and 

(vi) other areas determined appropriate by the Secretary. 

(B) The validity and reliability of responses on the 

OASIS instrument with particular emphasis on questions 

that relate to higher payment under the home health 

prospective payment system and higher outcome scores 

under Home Care Compare. 

(C) Additional research or payment revisions under 

the home health prospective payment system that may 

be necessary to set the payment rates for home health 

services based on costs of high-quality and efficient home 

health agencies or to improve Medicare beneficiary access 

to care. 

(D) A timetable for implementation of any appropriate 

changes based on the analysis of the matters described 

in subparagraphs (A), (B), and (C). 

(E) Other areas determined appropriate by the Secretary. 

(2) CONSIDERATIONS.—In conducting the study under paragraph (1), the Secretary shall consider whether certain factors 
H. R. 3590—312 

should be used to measure patient severity of illness and access 

to care, such as— 

(A) population density and relative patient access to 

care; 

(B) variations in service costs for providing care to 

individuals who are dually eligible under the Medicare 

and Medicaid programs; 

(C) the presence of severe or chronic diseases, as evidenced by multiple, discontinuous home health episodes; 

(D) poverty status, as evidenced by the receipt of 

Supplemental Security Income under title XVI of the Social 

Security Act; 

(E) the absence of caregivers; 

(F) language barriers; 

(G) atypical transportation costs; 

(H) security costs; and 

(I) other factors determined appropriate by the Secretary. 

(3) REPORT.—Not later than March 1, 2011, the Secretary 

shall submit to Congress a report on the study conducted under 

paragraph (1), together with recommendations for such legislation and administrative action as the Secretary determines 

appropriate. 

(4) CONSULTATIONS.—In conducting the study under paragraph (1) and preparing the report under paragraph (3), the 

Secretary shall consult with— 

(A) stakeholders representing home health agencies; 

(B) groups representing Medicare beneficiaries; 

(C) the Medicare Payment Advisory Commission; 

(D) the Inspector General of the Department of Health 

and Human Services; and 

(E) the Comptroller General of the United States. 

SEC. 3132. HOSPICE REFORM. 

(a) HOSPICE CARE PAYMENT REFORMS.— (1) IN GENERAL.—Section 1814(i) of the Social Security 

Act (42 U.S.C. 1395f(i)), as amended by section 3004(c), is 

amended— 

(A) by redesignating paragraph (6) as paragraph (7); 

and 

(B) by inserting after paragraph (5) the following new 

paragraph: 

‘‘(6)(A) The Secretary shall collect additional data and 

information as the Secretary determines appropriate to revise 

payments for hospice care under this subsection pursuant to 

subparagraph (D) and for other purposes as determined appropriate by the Secretary. The Secretary shall begin to collect 

such data by not later than January 1, 2011. 

‘‘(B) The additional data and information to be collected 

under subparagraph (A) may include data and information 

on— 

‘‘(i) charges and payments; 

‘‘(ii) the number of days of hospice care which are 

attributable to individuals who are entitled to, or enrolled 

for, benefits under part A; and 

‘‘(iii) with respect to each type of service included in 

hospice care— 
H. R. 3590—313 

‘‘(I) the number of days of hospice care attributable 

to the type of service; 

‘‘(II) the cost of the type of service; and 

‘‘(III) the amount of payment for the type of service; 

‘‘(iv) charitable contributions and other revenue of the 

hospice program; 

‘‘(v) the number of hospice visits; 

‘‘(vi) the type of practitioner providing the visit; and 

‘‘(vii) the length of the visit and other basic information 

with respect to the visit. 

‘‘(C) The Secretary may collect the additional data and 

information under subparagraph (A) on cost reports, claims, 

or other mechanisms as the Secretary determines to be appropriate. 

‘‘(D)(i) Notwithstanding the preceding paragraphs of this 

subsection, not earlier than October 1, 2013, the Secretary 

shall, by regulation, implement revisions to the methodology 

for determining the payment rates for routine home care and 

other services included in hospice care under this part, as 

the Secretary determines to be appropriate. Such revisions 

may be based on an analysis of data and information collected 

under subparagraph (A). Such revisions may include adjustments to per diem payments that reflect changes in resource 

intensity in providing such care and services during the course 

of the entire episode of hospice care. 

‘‘(ii) Revisions in payment implemented pursuant to clause 

(i) shall result in the same estimated amount of aggregate 

expenditures under this title for hospice care furnished in the 

fiscal year in which such revisions in payment are implemented 

as would have been made under this title for such care in 

such fiscal year if such revisions had not been implemented. 

‘‘(E) The Secretary shall consult with hospice programs 

and the Medicare Payment Advisory Commission regarding 

the additional data and information to be collected under 

subparagraph (A) and the payment revisions under subparagraph (D).’’. 

(2) CONFORMING AMENDMENTS.—Section 1814(i)(1)(C) of the 

Social Security Act (42 U.S.C. 1395f(i)(1)(C)) is amended— 

(A) in clause (ii)— 

(i) in the matter preceding subclause (I), by 

inserting ‘‘(before the first fiscal year in which the 

payment revisions described in paragraph (6)(D) are 

implemented)’’ after ‘‘subsequent fiscal year’’; and 

(ii) in subclause (VII), by inserting ‘‘(before the 

first fiscal year in which the payment revisions 

described in paragraph (6)(D) are implemented), subject to clause (iv),’’ after ‘‘subsequent fiscal year’’; and 

(B) by adding at the end the following new clause: 

‘‘(iii) With respect to routine home care and other 

services included in hospice care furnished during fiscal 

years subsequent to the first fiscal year in which payment revisions described in paragraph (6)(D) are implemented, the payment rates for such care and services 

shall be the payment rates in effect under this clause 

during the preceding fiscal year increased by, subject 

to clause (iv), the market basket percentage increase 
H. R. 3590—314 

(as defined in section 1886(b)(3)(B)(iii)) for the fiscal 

year.’’. 

(b) ADOPTION OF MEDPAC HOSPICE PROGRAM ELIGIBILITY RECERTIFICATION RECOMMENDATIONS.—Section 1814(a)(7) of the Social 

Security Act (42 U.S.C. 1395f(a)(7)) is amended— 

(1) in subparagraph (B), by striking ‘‘and’’ at the end; 

and 

(2) by adding at the end the following new subparagraph: 

‘‘(D) on and after January 1, 2011— 

‘‘(i) a hospice physician or nurse practitioner has 

a face-to-face encounter with the individual to determine continued eligibility of the individual for hospice 

care prior to the 180th-day recertification and each 

subsequent recertification under subparagraph (A)(ii) 

and attests that such visit took place (in accordance 

with procedures established by the Secretary); and 

‘‘(ii) in the case of hospice care provided an individual for more than 180 days by a hospice program 

for which the number of such cases for such program 

comprises more than a percent (specified by the Secretary) of the total number of such cases for all programs under this title, the hospice care provided to 

such individual is medically reviewed (in accordance 

with procedures established by the Secretary); and’’. 

SEC. 3133. IMPROVEMENT TO MEDICARE DISPROPORTIONATE SHARE 

HOSPITAL (DSH) PAYMENTS. 

Section 1886 of the Social Security Act (42 U.S.C. 1395ww), 

as amended by sections 3001, 3008, and 3025, is amended— 

(1) in subsection (d)(5)(F)(i), by striking ‘‘For’’ and inserting 

‘‘Subject to subsection (r), for’’; and 

(2) by adding at the end the following new subsection: 

‘‘(r) ADJUSTMENTS TO MEDICARE DSH PAYMENTS.— ‘‘(1) EMPIRICALLY JUSTIFIED DSH PAYMENTS.—For fiscal year 

2015 and each subsequent fiscal year, instead of the amount 

of disproportionate share hospital payment that would otherwise be made under subsection (d)(5)(F) to a subsection (d) 

hospital for the fiscal year, the Secretary shall pay to the 

subsection (d) hospital 25 percent of such amount (which represents the empirically justified amount for such payment, as 

determined by the Medicare Payment Advisory Commission 

in its March 2007 Report to the Congress). 

‘‘(2) ADDITIONAL PAYMENT.—In addition to the payment 

made to a subsection (d) hospital under paragraph (1), for 

fiscal year 2015 and each subsequent fiscal year, the Secretary 

shall pay to such subsection (d) hospitals an additional amount 

equal to the product of the following factors: 

‘‘(A) FACTOR ONE.—A factor equal to the difference 

between— 

‘‘(i) the aggregate amount of payments that would 

be made to subsection (d) hospitals under subsection 

(d)(5)(F) if this subsection did not apply for such fiscal 

year (as estimated by the Secretary); and 

‘‘(ii) the aggregate amount of payments that are 

made to subsection (d) hospitals under paragraph (1) 

for such fiscal year (as so estimated). 

‘‘(B) FACTOR TWO.— 
H. R. 3590—315 

‘‘(i) FISCAL YEARS 2015, 2016, AND 2017.—For each 

of fiscal years 2015, 2016, and 2017, a factor equal 

to 1 minus the percent change (divided by 100) in 

the percent of individuals under the age of 65 who 

are uninsured, as determined by comparing the percent 

of such individuals— 

‘‘(I) who are uninsured in 2012, the last year 

before coverage expansion under the Patient 

Protection and Affordable Care Act (as calculated 

by the Secretary based on the most recent estimates available from the Director of the Congressional Budget Office before a vote in either House 

on such Act that, if determined in the affirmative, 

would clear such Act for enrollment); and 

‘‘(II) who are uninsured in the most recent 

period for which data is available (as so calculated). 

‘‘(ii) 2018 AND SUBSEQUENT YEARS.—For fiscal year 

2018 and each subsequent fiscal year, a factor equal 

to 1 minus the percent change (divided by 100) in 

the percent of individuals who are uninsured, as determined by comparing the percent of individuals— 

‘‘(I) who are uninsured in 2012 (as estimated 

by the Secretary, based on data from the Census 

Bureau or other sources the Secretary determines 

appropriate, and certified by the Chief Actuary 

of the Centers for Medicare & Medicaid Services); 

and 

‘‘(II) who are uninsured in the most recent 

period for which data is available (as so estimated 

and certified). 

‘‘(C) FACTOR THREE.—A factor equal to the percent, 

for each subsection (d) hospital, that represents the 

quotient of— 

‘‘(i) the amount of uncompensated care for such 

hospital for a period selected by the Secretary (as 

estimated by the Secretary, based on appropriate data 

(including, in the case where the Secretary determines 

that alternative data is available which is a better 

proxy for the costs of subsection (d) hospitals for 

treating the uninsured, the use of such alternative 

data)); and 

‘‘(ii) the aggregate amount of uncompensated care 

for all subsection (d) hospitals that receive a payment 

under this subsection for such period (as so estimated, 

based on such data). 

‘‘(3) LIMITATIONS ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, 

or otherwise of the following: 

‘‘(A) Any estimate of the Secretary for purposes of 

determining the factors described in paragraph (2). 

‘‘(B) Any period selected by the Secretary for such 

purposes.’’. 
H. R. 3590—316 

SEC. 3134. MISVALUED CODES UNDER THE PHYSICIAN FEE SCHEDULE. 

(a) IN GENERAL.—Section 1848(c)(2) of the Social Security Act 

(42 U.S.C. 1395w–4(c)(2)) is amended by adding at the end the 

following new subparagraphs: 

‘‘(K) POTENTIALLY MISVALUED CODES.— ‘‘(i) IN GENERAL.—The Secretary shall— 

‘‘(I) periodically identify services as being 

potentially misvalued using criteria specified in 

clause (ii); and 

‘‘(II) review and make appropriate adjustments 

to the relative values established under this paragraph for services identified as being potentially 

misvalued under subclause (I). 

‘‘(ii) IDENTIFICATION OF POTENTIALLY MISVALUED

CODES.—For purposes of identifying potentially 

misvalued services pursuant to clause (i)(I), the Secretary shall examine (as the Secretary determines to 

be appropriate) codes (and families of codes as appropriate) for which there has been the fastest growth; 

codes (and families of codes as appropriate) that have 

experienced substantial changes in practice expenses; 

codes for new technologies or services within an appropriate period (such as 3 years) after the relative values 

are initially established for such codes; multiple codes 

that are frequently billed in conjunction with furnishing a single service; codes with low relative values, 

particularly those that are often billed multiple times 

for a single treatment; codes which have not been 

subject to review since the implementation of the 

RBRVS (the so-called ‘Harvard-valued codes’); and such 

other codes determined to be appropriate by the Secretary. 

‘‘(iii) REVIEW AND ADJUSTMENTS.— ‘‘(I) The Secretary may use existing processes 

to receive recommendations on the review and 

appropriate adjustment of potentially misvalued 

services described in clause (i)(II). 

‘‘(II) The Secretary may conduct surveys, other 

data collection activities, studies, or other analyses 

as the Secretary determines to be appropriate to 

facilitate the review and appropriate adjustment 

described in clause (i)(II). 

‘‘(III) The Secretary may use analytic contractors to identify and analyze services identified 

under clause (i)(I), conduct surveys or collect data, 

and make recommendations on the review and 

appropriate adjustment of services described in 

clause (i)(II). 

‘‘(IV) The Secretary may coordinate the review 

and appropriate adjustment described in clause 

(i)(II) with the periodic review described in 

subparagraph (B). 

‘‘(V) As part of the review and adjustment 

described in clause (i)(II), including with respect 

to codes with low relative values described in 

clause (ii), the Secretary may make appropriate 

coding revisions (including using existing processes 
H. R. 3590—317 

for consideration of coding changes) which may 

include consolidation of individual services into 

bundled codes for payment under the fee schedule 

under subsection (b). 

‘‘(VI) The provisions of subparagraph (B)(ii)(II) 

shall apply to adjustments to relative value units 

made pursuant to this subparagraph in the same 

manner as such provisions apply to adjustments 

under subparagraph (B)(ii)(II). 

‘‘(L) VALIDATING RELATIVE VALUE UNITS.— 

‘‘(i) IN GENERAL.—The Secretary shall establish a 

process to validate relative value units under the fee 

schedule under subsection (b). 

‘‘(ii) COMPONENTS AND ELEMENTS OF WORK.—The 

process described in clause (i) may include validation 

of work elements (such as time, mental effort and 

professional judgment, technical skill and physical 

effort, and stress due to risk) involved with furnishing 

a service and may include validation of the pre-, post- 

, and intra-service components of work. 

‘‘(iii) SCOPE OF CODES.—The validation of work 

relative value units shall include a sampling of codes 

for services that is the same as the codes listed under 

subparagraph (K)(ii). 

‘‘(iv) METHODS.—The Secretary may conduct the 

validation under this subparagraph using methods 

described in subclauses (I) through (V) of subparagraph 

(K)(iii) as the Secretary determines to be appropriate. 

‘‘(v) ADJUSTMENTS.—The Secretary shall make 

appropriate adjustments to the work relative value 

units under the fee schedule under subsection (b). The 

provisions of subparagraph (B)(ii)(II) shall apply to 

adjustments to relative value units made pursuant 

to this subparagraph in the same manner as such 

provisions apply to adjustments under subparagraph 

(B)(ii)(II).’’. 

(b) IMPLEMENTATION.— 

(1) ADMINISTRATION.— 

(A) Chapter 35 of title 44, United States Code and 

the provisions of the Federal Advisory Committee Act (5 

U.S.C. App.) shall not apply to this section or the amendment made by this section. 

(B) Notwithstanding any other provision of law, the 

Secretary may implement subparagraphs (K) and (L) of 

1848(c)(2) of the Social Security Act, as added by subsection 

(a), by program instruction or otherwise. 

(C) Section 4505(d) of the Balanced Budget Act of 

1997 is repealed. 

(D) Except for provisions related to confidentiality of 

information, the provisions of the Federal Acquisition Regulation shall not apply to this section or the amendment 

made by this section. 

(2) FOCUSING CMS RESOURCES ON POTENTIALLY OVERVALUED

CODES.—Section 1868(a) of the Social Security Act (42 U.S.C. 

1395ee(a)) is repealed. 
H. R. 3590—318 

SEC. 3135. MODIFICATION OF EQUIPMENT UTILIZATION FACTOR FOR 

ADVANCED IMAGING SERVICES. 

(a) ADJUSTMENT IN PRACTICE EXPENSE TO REFLECT HIGHER

PRESUMED UTILIZATION.—Section 1848 of the Social Security Act 

(42 U.S.C. 1395w–4) is amended— 

(1) in subsection (b)(4)— 

(A) in subparagraph (B), by striking ‘‘subparagraph 

(A)’’ and inserting ‘‘this paragraph’’; and 

(B) by adding at the end the following new subparagraph: 

‘‘(C) ADJUSTMENT IN PRACTICE EXPENSE TO REFLECT

HIGHER PRESUMED UTILIZATION.—Consistent with the methodology for computing the number of practice expense relative value units under subsection (c)(2)(C)(ii) with respect 

to advanced diagnostic imaging services (as defined in section 1834(e)(1)(B)) furnished on or after January 1, 2010, 

the Secretary shall adjust such number of units so it 

reflects— 

‘‘(i) in the case of services furnished on or after 

January 1, 2010, and before January 1, 2013, a 65 

percent (rather than 50 percent) presumed rate of utilization of imaging equipment; 

‘‘(ii) in the case of services furnished on or after 

January 1, 2013, and before January 1, 2014, a 70 

percent (rather than 50 percent) presumed rate of utilization of imaging equipment; and 

‘‘(iii) in the case of services furnished on or after 

January 1, 2014, a 75 percent (rather than 50 percent) 

presumed rate of utilization of imaging equipment.’’; 

and 

(2) in subsection (c)(2)(B)(v), by adding at the end the 

following new subclauses: 

‘‘(III) CHANGE IN PRESUMED UTILIZATION LEVEL

OF CERTAIN ADVANCED DIAGNOSTIC IMAGING SERVICES FOR 2010 THROUGH 2012.—Effective for fee 

schedules established beginning with 2010 and 

ending with 2012, reduced expenditures attributable to the presumed rate of utilization of 

imaging equipment of 65 percent under subsection 

(b)(4)(C)(i) instead of a presumed rate of utilization 

of such equipment of 50 percent. 

‘‘(IV) CHANGE IN PRESUMED UTILIZATION LEVEL

OF CERTAIN ADVANCED DIAGNOSTIC IMAGING SERVICES FOR 2013.—Effective for fee schedules established for 2013, reduced expenditures attributable 

to the presumed rate of utilization of imaging 

equipment of 70 percent under subsection 

(b)(4)(C)(ii) instead of a presumed rate of utilization of such equipment of 50 percent. 

‘‘(V) CHANGE IN PRESUMED UTILIZATION LEVEL

OF CERTAIN ADVANCED DIAGNOSTIC IMAGING SERVICES FOR 2014 AND SUBSEQUENT YEARS.—Effective 

for fee schedules established beginning with 2014, 

reduced expenditures attributable to the presumed 
H. R. 3590—319 

rate of utilization of imaging equipment of 75 percent under subsection (b)(4)(C)(iii) instead of a presumed rate of utilization of such equipment of 

50 percent.’’. 

(b) ADJUSTMENT IN TECHNICAL COMPONENT ‘‘DISCOUNT’’ ON

SINGLE-SESSION IMAGING TO CONSECUTIVE BODY PARTS.—Section 

1848 of the Social Security Act (42 U.S.C. 1395w–4), as amended 

by subsection (a), is amended— 

(1) in subsection (b)(4), by adding at the end the following 

new subparagraph: 

‘‘(D) ADJUSTMENT IN TECHNICAL COMPONENT DISCOUNT

ON SINGLE-SESSION IMAGING INVOLVING CONSECUTIVE BODY

PARTS.—For services furnished on or after July 1, 2010, 

the Secretary shall increase the reduction in payments 

attributable to the multiple procedure payment reduction 

applicable to the technical component for imaging under 

the final rule published by the Secretary in the Federal 

Register on November 21, 2005 (part 405 of title 42, Code 

of Federal Regulations) from 25 percent to 50 percent.’’; 

and 

(2) in subsection (c)(2)(B)(v), by adding at the end the 

following new subclause: 

‘‘(VI) ADDITIONAL REDUCED PAYMENT FOR MULTIPLE IMAGING PROCEDURES.—Effective for fee 

schedules established beginning with 2010 (but 

not applied for services furnished prior to July 

1, 2010), reduced expenditures attributable to the 

increase in the multiple procedure payment reduction from 25 to 50 percent (as described in subsection (b)(4)(D)).’’. 

(c) ANALYSIS BY THE CHIEF ACTUARY OF THE CENTERS FOR

MEDICARE & MEDICAID SERVICES.—Not later than January 1, 2013, 

the Chief Actuary of the Centers for Medicare & Medicaid Services 

shall make publicly available an analysis of whether, for the period 

of 2010 through 2019, the cumulative expenditure reductions under 

title XVIII of the Social Security Act that are attributable to the 

adjustments under the amendments made by this section are projected to exceed $3,000,000,000. 

SEC. 3136. REVISION OF PAYMENT FOR POWER-DRIVEN WHEELCHAIRS. 

(a) IN GENERAL.—Section 1834(a)(7)(A) of the Social Security 

Act (42 U.S.C. 1395m(a)(7)(A)) is amended— 

(1) in clause (i)— 

(A) in subclause (II), by inserting ‘‘subclause (III) and’’ 

after ‘‘Subject to’’; and 

(B) by adding at the end the following new subclause: 

‘‘(III) SPECIAL RULE FOR POWER-DRIVEN WHEELCHAIRS.—For purposes of payment for powerdriven wheelchairs, subclause (II) shall be applied 

by substituting ‘15 percent’ and ‘6 percent’ for ‘10 

percent’ and ‘7.5 percent’, respectively.’’; and 

(2) in clause (iii)— 

(A) in the heading, by inserting ‘‘COMPLEX, REHABILITATIVE’’ before ‘‘POWER-DRIVEN’’; and 

(B) by inserting ‘‘complex, rehabilitative’’ before 

‘‘power-driven’’. 
H. R. 3590—320 

(b) TECHNICAL AMENDMENT.—Section 1834(a)(7)(C)(ii)(II) of the 

Social Security Act (42 U.S.C. 1395m(a)(7)(C)(ii)(II)) is amended 

by striking ‘‘(A)(ii) or’’. 

(c) EFFECTIVE DATE.— 

(1) IN GENERAL.—Subject to paragraph (2), the amendments 

made by subsection (a) shall take effect on January 1, 2011, 

and shall apply to power-driven wheelchairs furnished on or 

after such date. 

(2) APPLICATION TO COMPETITIVE BIDDING.—The amendments made by subsection (a) shall not apply to payment made 

for items and services furnished pursuant to contracts entered 

into under section 1847 of the Social Security Act (42 U.S.C. 

1395w–3) prior to January 1, 2011, pursuant to the implementation of subsection (a)(1)(B)(i)(I) of such section 1847. 

SEC. 3137. HOSPITAL WAGE INDEX IMPROVEMENT. 

(a) EXTENSION OF SECTION 508 HOSPITAL RECLASSIFICATIONS.— 

(1) IN GENERAL.—Subsection (a) of section 106 of division 

B of the Tax Relief and Health Care Act of 2006 (42 U.S.C. 

1395 note), as amended by section 117 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public Law 110– 

173) and section 124 of the Medicare Improvements for Patients 

and Providers Act of 2008 (Public Law 110–275), is amended 

by striking ‘‘September 30, 2009’’ and inserting ‘‘September 

30, 2010’’. 

(2) USE OF PARTICULAR WAGE INDEX IN FISCAL YEAR 2010.— 

For purposes of implementation of the amendment made by 

this subsection during fiscal year 2010, the Secretary shall 

use the hospital wage index that was promulgated by the 

Secretary in the Federal Register on August 27, 2009 (74 Fed. 

Reg. 43754), and any subsequent corrections. 

(b) PLAN FOR REFORMING THE MEDICARE HOSPITAL WAGE INDEX

SYSTEM.— 

(1) IN GENERAL.—Not later than December 31, 2011, the 

Secretary of Health and Human Services (in this section 

referred to as the ‘‘Secretary’’) shall submit to Congress a 

report that includes a plan to reform the hospital wage index 

system under section 1886 of the Social Security Act. 

(2) DETAILS.—In developing the plan under paragraph (1), 

the Secretary shall take into account the goals for reforming 

such system set forth in the Medicare Payment Advisory 

Commission June 2007 report entitled ‘‘Report to Congress: 

Promoting Greater Efficiency in Medicare’’, including establishing a new hospital compensation index system that— 

(A) uses Bureau of Labor Statistics data, or other data 

or methodologies, to calculate relative wages for each 

geographic area involved; 

(B) minimizes wage index adjustments between and 

within metropolitan statistical areas and statewide rural 

areas; 

(C) includes methods to minimize the volatility of wage 

index adjustments that result from implementation of 

policy, while maintaining budget neutrality in applying 

such adjustments; 

(D) takes into account the effect that implementation 

of the system would have on health care providers and 

on each region of the country; 
H. R. 3590—321 

(E) addresses issues related to occupational mix, such 

as staffing practices and ratios, and any evidence on the 

effect on quality of care or patient safety as a result of 

the implementation of the system; and 

(F) provides for a transition. 

(3) CONSULTATION.—In developing the plan under paragraph (1), the Secretary shall consult with relevant affected 

parties. 

(c) USE OF PARTICULAR CRITERIA FOR DETERMINING RECLASSI- FICATIONS.—Notwithstanding any other provision of law, in making 

decisions on applications for reclassification of a subsection (d) 

hospital (as defined in paragraph (1)(B) of section 1886(d) of the 

Social Security Act (42 U.S.C. 1395ww(d)) for the purposes described 

in paragraph (10)(D)(v) of such section for fiscal year 2011 and 

each subsequent fiscal year (until the first fiscal year beginning 

on or after the date that is 1 year after the Secretary of Health 

and Human Services submits the report to Congress under subsection (b)), the Geographic Classification Review Board established 

under paragraph (10) of such section shall use the average hourly 

wage comparison criteria used in making such decisions as of September 30, 2008. The preceding sentence shall be effected in a 

budget neutral manner. 

SEC. 3138. TREATMENT OF CERTAIN CANCER HOSPITALS. 

Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)) 

is amended by adding at the end the following new paragraph: 

‘‘(18) AUTHORIZATION OF ADJUSTMENT FOR CANCER HOS- PITALS.— 

‘‘(A) STUDY.—The Secretary shall conduct a study to 

determine if, under the system under this subsection, costs 

incurred by hospitals described in section 1886(d)(1)(B)(v) 

with respect to ambulatory payment classification groups 

exceed those costs incurred by other hospitals furnishing 

services under this subsection (as determined appropriate 

by the Secretary). In conducting the study under this 

subparagraph, the Secretary shall take into consideration 

the cost of drugs and biologicals incurred by such hospitals. 

‘‘(B) AUTHORIZATION OF ADJUSTMENT.—Insofar as the 

Secretary determines under subparagraph (A) that costs 

incurred by hospitals described in section 1886(d)(1)(B)(v) 

exceed those costs incurred by other hospitals furnishing 

services under this subsection, the Secretary shall provide 

for an appropriate adjustment under paragraph (2)(E) to 

reflect those higher costs effective for services furnished 

on or after January 1, 2011.’’. 

SEC. 3139. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS. 

(a) IN GENERAL.—Section 1847A of the Social Security Act 

(42 U.S.C. 1395w–3a) is amended— 

(1) in subsection (b)— 

(A) in paragraph (1)— 

(i) in subparagraph (A), by striking ‘‘or’’ at the 

end; 

(ii) in subparagraph (B), by striking the period 

at the end and inserting ‘‘; or’’; and 

(iii) by adding at the end the following new 

subparagraph: 
H. R. 3590—322 

‘‘(C) in the case of a biosimilar biological product (as 

defined in subsection (c)(6)(H)), the amount determined 

under paragraph (8).’’; and 

(B) by adding at the end the following new paragraph: 

‘‘(8) BIOSIMILAR BIOLOGICAL PRODUCT.—The amount specified in this paragraph for a biosimilar biological product 

described in paragraph (1)(C) is the sum of— 

‘‘(A) the average sales price as determined using the 

methodology described under paragraph (6) applied to a 

biosimilar biological product for all National Drug Codes 

assigned to such product in the same manner as such 

paragraph is applied to drugs described in such paragraph; 

and 

‘‘(B) 6 percent of the amount determined under paragraph (4) for the reference biological product (as defined 

in subsection (c)(6)(I)).’’; and 

(2) in subsection (c)(6), by adding at the end the following 

new subparagraph: 

‘‘(H) BIOSIMILAR BIOLOGICAL PRODUCT.—The term ‘biosimilar biological product’ means a biological product 

approved under an abbreviated application for a license 

of a biological product that relies in part on data or information in an application for another biological product licensed 

under section 351 of the Public Health Service Act. 

‘‘(I) REFERENCE BIOLOGICAL PRODUCT.—The term ‘reference biological product’ means the biological product 

licensed under such section 351 that is referred to in the 

application described in subparagraph (H) of the biosimilar 

biological product.’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall apply to payments for biosimilar biological products beginning with the first day of the second calendar quarter after enactment of legislation providing for a biosimilar pathway (as determined by the Secretary). 

SEC. 3140. MEDICARE HOSPICE CONCURRENT CARE DEMONSTRATION 

PROGRAM. 

(a) ESTABLISHMENT.— (1) IN GENERAL.—The Secretary of Health and Human 

Services (in this section referred to as the ‘‘Secretary’’) shall 

establish a Medicare Hospice Concurrent Care demonstration 

program at participating hospice programs under which Medicare beneficiaries are furnished, during the same period, hospice care and any other items or services covered under title 

XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) from 

funds otherwise paid under such title to such hospice programs. 

(2) DURATION.—The demonstration program under this section shall be conducted for a 3-year period. 

(3) SITES.—The Secretary shall select not more than 15 

hospice programs at which the demonstration program under 

this section shall be conducted. Such hospice programs shall 

be located in urban and rural areas. 

(b) INDEPENDENT EVALUATION AND REPORTS.— 

(1) INDEPENDENT EVALUATION.—The Secretary shall provide for the conduct of an independent evaluation of the demonstration program under this section. Such independent 

evaluation shall determine whether the demonstration program 
H. R. 3590—323 

has improved patient care, quality of life, and cost-effectiveness 

for Medicare beneficiaries participating in the demonstration 

program. 

(2) REPORTS.—The Secretary shall submit to Congress a 

report containing the results of the evaluation conducted under 

paragraph (1), together with such recommendations as the Secretary determines appropriate. 

(c) BUDGET NEUTRALITY.—With respect to the 3-year period 

of the demonstration program under this section, the Secretary 

shall ensure that the aggregate expenditures under title XVIII 

for such period shall not exceed the aggregate expenditures that 

would have been expended under such title if the demonstration 

program under this section had not been implemented. 

SEC. 3141. APPLICATION OF BUDGET NEUTRALITY ON A NATIONAL 

BASIS IN THE CALCULATION OF THE MEDICARE HOSPITAL WAGE INDEX FLOOR. 

In the case of discharges occurring on or after October 1, 

2010, for purposes of applying section 4410 of the Balanced Budget 

Act of 1997 (42 U.S.C. 1395ww note) and paragraph (h)(4) of section 

412.64 of title 42, Code of Federal Regulations, the Secretary of 

Health and Human Services shall administer subsection (b) of such 

section 4410 and paragraph (e) of such section 412.64 in the same 

manner as the Secretary administered such subsection (b) and 

paragraph (e) for discharges occurring during fiscal year 2008 

(through a uniform, national adjustment to the area wage index). 

SEC. 3142. HHS STUDY ON URBAN MEDICARE-DEPENDENT HOSPITALS. 

(a) STUDY.— (1) IN GENERAL.—The Secretary of Health and Human 

Services (in this section referred to as the ‘‘Secretary’’) shall 

conduct a study on the need for an additional payment for 

urban Medicare-dependent hospitals for inpatient hospital services under section 1886 of the Social Security Act (42 U.S.C. 

1395ww). Such study shall include an analysis of— 

(A) the Medicare inpatient margins of urban Medicaredependent hospitals, as compared to other hospitals which 

receive 1 or more additional payments or adjustments 

under such section (including those payments or adjustments described in paragraph (2)(A)); and 

(B) whether payments to medicare-dependent, small 

rural hospitals under subsection (d)(5)(G) of such section 

should be applied to urban Medicare-dependent hospitals. 

(2) URBAN MEDICARE-DEPENDENT HOSPITAL DEFINED.—For 

purposes of this section, the term ‘‘urban Medicare-dependent 

hospital’’ means a subsection (d) hospital (as defined in subsection (d)(1)(B) of such section) that— 

(A) does not receive any additional payment or adjustment under such section, such as payments for indirect 

medical education costs under subsection (d)(5)(B) of such 

section, disproportionate share payments under subsection 

(d)(5)(A) of such section, payments to a rural referral center 

under subsection (d)(5)(C) of such section, payments to 

a critical access hospital under section 1814(l) of such Act 

(42 U.S.C. 1395f(l)), payments to a sole community hospital 

under subsection (d)(5)(D) of such section 1886, or payments to a medicare-dependent, small rural hospital under 

subsection (d)(5)(G) of such section 1886; and 
H. R. 3590—324 

(B) for which more than 60 percent of its inpatient 

days or discharges during 2 of the 3 most recently audited 

cost reporting periods for which the Secretary has a settled 

cost report were attributable to inpatients entitled to benefits under part A of title XVIII of such Act. 

(b) REPORT.—Not later than 9 months after the date of enactment of this Act, the Secretary shall submit to Congress a report 

containing the results of the study conducted under subsection 

(a), together with recommendations for such legislation and 

administrative action as the Secretary determines appropriate. 

SEC. 3143. PROTECTING HOME HEALTH BENEFITS. 

Nothing in the provisions of, or amendments made by, this 

Act shall result in the reduction of guaranteed home health benefits 

under title XVIII of the Social Security Act. 

Subtitle C—Provisions Relating to Part C 

SEC. 3201. MEDICARE ADVANTAGE PAYMENT. 

(a) MA BENCHMARK BASED ON PLAN’S COMPETITIVE BIDS.— 

(1) IN GENERAL.—Section 1853(j) of the Social Security 

Act (42 U.S.C. 1395w–23(j)) is amended— 

(A) by striking ‘‘AMOUNTS.—For purposes’’ and 

inserting ‘‘AMOUNTS.— 

‘‘(1) IN GENERAL.—For purposes’’; 

(B) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and indenting the subparagraphs appropriately; 

(C) in subparagraph (A), as redesignated by subparagraph (B)— 

(i) by redesignating subparagraphs (A) and (B) 

as clauses (i) and (ii), respectively, and indenting the 

clauses appropriately; and 

(ii) in clause (i), as redesignated by clause (i), 

by striking ‘‘an amount equal to’’ and all that follows 

through the end and inserting ‘‘an amount equal to— 

‘‘(I) for years before 2007, 1⁄12 of the annual 

MA capitation rate under section 1853(c)(1) for 

the area for the year, adjusted as appropriate for 

the purpose of risk adjustment; 

‘‘(II) for 2007 through 2011, 1⁄12 of the 

applicable amount determined under subsection 

(k)(1) for the area for the year; 

‘‘(III) for 2012, the sum of— 

‘‘(aa) 2⁄3 of the quotient of— 

‘‘(AA) the applicable amount determined under subsection (k)(1) for the area 

for the year; and 

‘‘(BB) 12; and 

‘‘(bb) 1⁄3 of the MA competitive benchmark 

amount (determined under paragraph (2)) for 

the area for the month; 

‘‘(IV) for 2013, the sum of— 

‘‘(aa) 1⁄3 of the quotient of— 
H. R. 3590—325 

‘‘(AA) the applicable amount determined under subsection (k)(1) for the area 

for the year; and 

‘‘(BB) 12; and 

‘‘(bb) 2⁄3 of the MA competitive benchmark 

amount (as so determined) for the area for 

the month; 

‘‘(V) for 2014, the MA competitive benchmark 

amount for the area for a month in 2013 (as so 

determined), increased by the national per capita 

MA growth percentage, described in subsection 

(c)(6) for 2014, but not taking into account any 

adjustment under subparagraph (C) of such subsection for a year before 2004; and 

‘‘(VI) for 2015 and each subsequent year, the 

MA competitive benchmark amount (as so determined) for the area for the month; or’’; 

(iii) in clause (ii), as redesignated by clause (i), 

by striking ‘‘subparagraph (A)’’ and inserting ‘‘clause 

(i)’’; 

(D) by adding at the end the following new paragraphs: 

‘‘(2) COMPUTATION OF MA COMPETITIVE BENCHMARK

AMOUNT.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B) and 

paragraph (3), for months in each year (beginning with 

2012) for each MA payment area the Secretary shall compute an MA competitive benchmark amount equal to the 

weighted average of the unadjusted MA statutory nondrug monthly bid amount (as defined in section 

1854(b)(2)(E)) for each MA plan in the area, with the weight 

for each plan being equal to the average number of beneficiaries enrolled under such plan in the reference month 

(as defined in section 1858(f)(4), except that, in applying 

such definition for purposes of this paragraph, ‘to compute 

the MA competitive benchmark amount under section 

1853(j)(2)’ shall be substituted for ‘to compute the percentage specified in subparagraph (A) and other relevant 

percentages under this part’). 

‘‘(B) WEIGHTING RULES.— 

‘‘(i) SINGLE PLAN RULE.—In the case of an MA 

payment area in which only a single MA plan is being 

offered, the weight under subparagraph (A) shall be 

equal to 1. 

‘‘(ii) USE OF SIMPLE AVERAGE AMONG MULTIPLE

PLANS IF NO PLANS OFFERED IN PREVIOUS YEAR.—In 

the case of an MA payment area in which no MA 

plan was offered in the previous year and more than 

1 MA plan is offered in the current year, the Secretary 

shall use a simple average of the unadjusted MA statutory non-drug monthly bid amount (as so defined) for 

purposes of computing the MA competitive benchmark 

amount under subparagraph (A). 

‘‘(3) CAP ON MA COMPETITIVE BENCHMARK AMOUNT.—In no 

case shall the MA competitive benchmark amount for an area 

for a month in a year be greater than the applicable amount 
H. R. 3590—326 

that would (but for the application of this subsection) be determined under subsection (k)(1) for the area for the month in 

the year.’’; and 

(E) in subsection (k)(2)(B)(ii)(III), by striking ‘‘(j)(1)(A)’’ 

and inserting ‘‘(j)(1)(A)(i)’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Section 1853(k)(2) of the Social Security Act (42 

U.S.C. 1395w–23(k)(2)) is amended— 

(i) in subparagraph (A), by striking ‘‘through 2010’’ 

and inserting ‘‘and subsequent years’’; and 

(ii) in subparagraph (C)— 

(I) in clause (iii), by striking ‘‘and’’ at the 

end; 

(II) in clause (iv), by striking the period at 

the end and inserting ‘‘; and’’; and 

(III) by adding at the end the following new 

clause: 

‘‘(v) for 2011 and subsequent years, 0.00.’’. 

(B) Section 1854(b) of the Social Security Act (42 U.S.C. 

1395w–24(b)) is amended— 

(i) in paragraph (3)(B)(i), by striking ‘‘1853(j)(1)’’ 

and inserting ‘‘1853(j)(1)(A)’’; and 

(ii) in paragraph (4)(B)(i), by striking ‘‘1853(j)(2)’’ 

and inserting ‘‘1853(j)(1)(B)’’. 

(C) Section 1858(f) of the Social Security Act (42 U.S.C. 

1395w–27(f)) is amended— 

(i) in paragraph (1), by striking ‘‘1853(j)(2)’’ and 

inserting ‘‘1853(j)(1)(B)’’; and 

(ii) in paragraph (3)(A), by striking ‘‘1853(j)(1)(A)’’ 

and inserting ‘‘1853(j)(1)(A)(i)’’. 

(D) Section 1860C–1(d)(1)(A) of the Social Security Act 

(42 U.S.C. 1395w–29(d)(1)(A)) is amended by striking 

‘‘1853(j)(1)(A)’’ and inserting ‘‘1853(j)(1)(A)(i)’’. 

(b) REDUCTION OF NATIONAL PER CAPITA GROWTH PERCENTAGE

FOR 2011.—Section 1853(c)(6) of the Social Security Act (42 U.S.C. 

1395w–23(c)(6)) is amended— 

(1) in clause (v), by striking ‘‘and’’ at the end; 

(2) in clause (vi)— 

(A) by striking ‘‘for a year after 2002’’ and inserting 

‘‘for 2003 through 2010’’; and 

(B) by striking the period at the end and inserting 

a comma; and 

(C) by adding at the end the following new clauses: 

‘‘(vii) for 2011, 3 percentage points; and 

‘‘(viii) for a year after 2011, 0 percentage points.’’. 

(c) ENHANCEMENT OF BENEFICIARY REBATES.—Section 

1854(b)(1)(C)(i) of the Social Security Act (42 U.S.C. 1395w– 

24(b)(1)(C)(i)) is amended by inserting ‘‘(or 100 percent in the case 

of plan years beginning on or after January 1, 2014)’’ after ‘‘75 

percent’’. 

(d) BIDDING RULES.— (1) REQUIREMENTS FOR INFORMATION SUBMITTED.—Section 

1854(a)(6)(A) of the Social Security Act (42 U.S.C. 1395w– 

24(a)(6)(A)) is amended, in the flush matter following clause 

(v), by adding at the end the following sentence: ‘‘Information 

to be submitted under this paragraph shall be certified by 

a qualified member of the American Academy of Actuaries 
H. R. 3590—327 

and shall meet actuarial guidelines and rules established by 

the Secretary under subparagraph (B)(v).’’. 

(2) ESTABLISHMENT OF ACTUARIAL GUIDELINES.—Section 

1854(a)(6)(B) of the Social Security Act (42 U.S.C. 1395w– 

24(a)(6)(B)) is amended— 

(A) in clause (i), by striking ‘‘(iii) and (iv)’’ and inserting 

‘‘(iii), (iv), and (v)’’; and 

(B) by adding at the end the following new clause: 

‘‘(v) ESTABLISHMENT OF ACTUARIAL GUIDELINES.— 

‘‘(I) IN GENERAL.—In order to establish fair 

MA competitive benchmarks under section 

1853(j)(1)(A)(i), the Secretary, acting through the 

Chief Actuary of the Centers for Medicare & Medicaid Services (in this clause referred to as the 

‘Chief Actuary’), shall establish— 

‘‘(aa) actuarial guidelines for the submission of bid information under this paragraph; 

and 

‘‘(bb) bidding rules that are appropriate 

to ensure accurate bids and fair competition 

among MA plans. 

‘‘(II) DENIAL OF BID AMOUNTS.—The Secretary 

shall deny monthly bid amounts submitted under 

subparagraph (A) that do not meet the actuarial 

guidelines and rules established under subclause 

(I). 

‘‘(III) REFUSAL TO ACCEPT CERTAIN BIDS DUE

TO MISREPRESENTATIONS AND FAILURES TO ADEQUATELY MEET REQUIREMENTS.—In the case where 

the Secretary determines that information submitted by an MA organization under subparagraph 

(A) contains consistent misrepresentations and 

failures to adequately meet requirements of the 

organization, the Secretary may refuse to accept 

any additional such bid amounts from the 

organization for the plan year and the Chief 

Actuary shall, if the Chief Actuary determines that 

the actuaries of the organization were complicit 

in those misrepresentations and failures, report 

those actuaries to the Actuarial Board for Counseling and Discipline.’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to bid amounts submitted on or after 

January 1, 2012. 

(e) MA LOCAL PLAN SERVICE AREAS.— 

(1) IN GENERAL.—Section 1853(d) of the Social Security 

Act (42 U.S.C. 1395w–23(d)) is amended— 

(A) in the subsection heading, by striking ‘‘MA REGION’’ 

and inserting ‘‘MA REGION; MA LOCAL PLAN SERVICE

AREA’’; 

(B) in paragraph (1), by striking subparagraph (A) 

and inserting the following: 

‘‘(A) with respect to an MA local plan— 

‘‘(i) for years before 2012, an MA local area (as 

defined in paragraph (2)); and 
H. R. 3590—328 

‘‘(ii) for 2012 and succeeding years, a service area 

that is an entire urban or rural area, as applicable 

(as described in paragraph (5)); and’’; and 

(C) by adding at the end the following new paragraph: 

‘‘(5) MA LOCAL PLAN SERVICE AREA.—For 2012 and succeeding years, the service area for an MA local plan shall 

be an entire urban or rural area in each State as follows: 

‘‘(A) URBAN AREAS.— 

‘‘(i) IN GENERAL.—Subject to clause (ii) and subparagraphs (C) and (D), the service area for an MA 

local plan in an urban area shall be the Core Based 

Statistical Area (in this paragraph referred to as a 

‘CBSA’) or, if applicable, a conceptually similar alternative classification, as defined by the Director of the 

Office of Management and Budget. 

‘‘(ii) CBSA COVERING MORE THAN ONE STATE.— 

In the case of a CBSA (or alternative classification) 

that covers more than one State, the Secretary shall 

divide the CBSA (or alternative classification) into 

separate service areas with respect to each State covered by the CBSA (or alternative classification). 

‘‘(B) RURAL AREAS.—Subject to subparagraphs (C) and 

(D), the service area for an MA local plan in a rural 

area shall be a county that does not qualify for inclusion 

in a CBSA (or alternative classification), as defined by 

the Director of the Office of Management and Budget. 

‘‘(C) REFINEMENTS TO SERVICE AREAS.—For 2015 and 

succeeding years, in order to reflect actual patterns of 

health care service utilization, the Secretary may adjust 

the boundaries of service areas for MA local plans in urban 

areas and rural areas under subparagraphs (A) and (B), 

respectively, but may only do so based on recent analyses 

of actual patterns of care. 

‘‘(D) ADDITIONAL AUTHORITY TO MAKE LIMITED EXCEPTIONS TO SERVICE AREA REQUIREMENTS FOR MA LOCAL

PLANS.—The Secretary may, in addition to any adjustments 

under subparagraph (C), make limited exceptions to service 

area requirements otherwise applicable under this part 

for MA local plans that have in effect (as of the date 

of enactment of the Patient Protection and Affordable Care 

Act)— 

‘‘(i) agreements with another MA organization or 

MA plan that preclude the offering of benefits throughout an entire service area; or 

‘‘(ii) limitations in their structural capacity to support adequate networks throughout an entire service 

area as a result of the delivery system model of the 

MA local plan.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) IN GENERAL.— 

(i) Section 1851(b)(1) of the Social Security Act 

(42 U.S.C. 1395w–21(b)(1)) is amended by striking 

subparagraph (C). 

(ii) Section 1853(b)(1)(B)(i) of such Act (42 U.S.C. 

1395w–23(b)(1)(B)(i))— 
H. R. 3590—329 

(I) in the matter preceding subclause (I), by 

striking ‘‘MA payment area’’ and inserting ‘‘MA 

local area (as defined in subsection (d)(2))’’; and 

(II) in subclause (I), by striking ‘‘MA payment 

area’’ and inserting ‘‘MA local area (as so defined)’’. 

(iii) Section 1853(b)(4) of such Act (42 U.S.C. 

1395w–23(b)(4)) is amended by striking ‘‘Medicare 

Advantage payment area’’ and inserting ‘‘MA local area 

(as so defined)’’. 

(iv) Section 1853(c)(1) of such Act (42 U.S.C. 

1395w–23(c)(1)) is amended— 

(I) in the matter preceding subparagraph (A), 

by striking ‘‘a Medicare Advantage payment area 

that is’’; and 

(II) in subparagraph (D)(i), by striking ‘‘MA 

payment area’’ and inserting ‘‘MA local area (as 

defined in subsection (d)(2))’’. 

(v) Section 1854 of such Act (42 U.S.C. 1395w– 

24) is amended by striking subsection (h). 

(B) EFFECTIVE DATE.—The amendments made by this 

paragraph shall take effect on January 1, 2012. 

(f) PERFORMANCE BONUSES.— 

(1) MA PLANS.— 

(A) IN GENERAL.—Section 1853 of the Social Security 

Act (42 U.S.C. 1395w–23) is amended by adding at the 

end the following new subsection: 

‘‘(n) PERFORMANCE BONUSES.— ‘‘(1) CARE COORDINATION AND MANAGEMENT PERFORMANCE

BONUS.— 

‘‘(A) IN GENERAL.—For years beginning with 2014, subject to subparagraph (B), in the case of an MA plan that 

conducts 1 or more programs described in subparagraph 

(C) with respect to the year, the Secretary shall, in addition 

to any other payment provided under this part, make 

monthly payments, with respect to coverage of an individual under this part, to the MA plan in an amount 

equal to the product of— 

‘‘(i) 0.5 percent of the national monthly per capita 

cost for expenditures for individuals enrolled under 

the original medicare fee-for-service program for the 

year; and 

‘‘(ii) the total number of programs described in 

clauses (i) through (ix) of subparagraph (C) that the 

Secretary determines the plan is conducting for the 

year under such subparagraph. 

‘‘(B) LIMITATION.—In no case may the total amount 

of payment with respect to a year under subparagraph 

(A) be greater than 2 percent of the national monthly 

per capita cost for expenditures for individuals enrolled 

under the original medicare fee-for-service program for the 

year, as determined prior to the application of risk adjustment under paragraph (4). 

‘‘(C) PROGRAMS DESCRIBED.—The following programs 

are described in this paragraph: 

‘‘(i) Care management programs that— 

‘‘(I) target individuals with 1 or more chronic 

conditions; 
H. R. 3590—330 

‘‘(II) identify gaps in care; and 

‘‘(III) facilitate improved care by using additional resources like nurses, nurse practitioners, 

and physician assistants. 

‘‘(ii) Programs that focus on patient education and 

self-management of health conditions, including interventions that— 

‘‘(I) help manage chronic conditions; 

‘‘(II) reduce declines in health status; and 

‘‘(III) foster patient and provider collaboration. 

‘‘(iii) Transitional care interventions that focus on 

care provided around a hospital inpatient episode, 

including programs that target post-discharge patient 

care in order to reduce unnecessary health complications and readmissions. 

‘‘(iv) Patient safety programs, including provisions 

for hospital-based patient safety programs in contracts 

that the Medicare Advantage organization offering the 

MA plan has with hospitals. 

‘‘(v) Financial policies that promote systematic 

coordination of care by primary care physicians across 

the full spectrum of specialties and sites of care, such 

as medical homes, capitation arrangements, or payfor-performance programs. 

‘‘(vi) Programs that address, identify, and ameliorate health care disparities among principal at-risk 

subpopulations. 

‘‘(vii) Medication therapy management programs 

that are more extensive than is required under section 

1860D–4(c) (as determined by the Secretary). 

‘‘(viii) Health information technology programs, 

including clinical decision support and other tools to 

facilitate data collection and ensure patient-centered, 

appropriate care. 

‘‘(ix) Such other care management and coordination 

programs as the Secretary determines appropriate. 

‘‘(D) CONDUCT OF PROGRAM IN URBAN AND RURAL

AREAS.—An MA plan may conduct a program described 

in subparagraph (C) in a manner appropriate for an urban 

or rural area, as applicable. 

‘‘(E) REPORTING OF DATA.—Each Medicare Advantage 

organization shall provide to the Secretary the information 

needed to determine whether they are eligible for a care 

coordination and management performance bonus at a time 

and in a manner specified by the Secretary. 

‘‘(F) PERIODIC AUDITING.—The Secretary shall provide 

for the annual auditing of programs described in subparagraph (C) for which an MA plan receives a care coordination 

and management performance bonus under this paragraph. 

The Comptroller General shall monitor auditing activities 

conducted under this subparagraph. 

‘‘(2) QUALITY PERFORMANCE BONUSES.— ‘‘(A) QUALITY BONUS.—For years beginning with 2014, 

the Secretary shall, in addition to any other payment provided under this part, make monthly payments, with 

respect to coverage of an individual under this part, to 

an MA plan that achieves at least a 3 star rating (or 
H. R. 3590—331 

comparable rating) on a rating system described in 

subparagraph (C) in an amount equal to— 

‘‘(i) in the case of a plan that achieves a 3 star 

rating (or comparable rating) on such system 2 percent 

of the national monthly per capita cost for expenditures 

for individuals enrolled under the original medicare 

fee-for-service program for the year; and 

‘‘(ii) in the case of a plan that achieves a 4 or 

5 star rating (or comparable rating on such system, 

4 percent of such national monthly per capita cost 

for the year. 

‘‘(B) IMPROVED QUALITY BONUS.—For years beginning 

with 2014, in the case of an MA plan that does not receive 

a quality bonus under subparagraph (A) and is an improved 

quality MA plan with respect to the year (as identified 

by the Secretary), the Secretary shall, in addition to any 

other payment provided under this part, make monthly 

payments, with respect to coverage of an individual under 

this part, to the MA plan in an amount equal to 1 percent 

of such national monthly per capita cost for the year. 

‘‘(C) USE OF RATING SYSTEM.—For purposes of subparagraph (A), a rating system described in this paragraph 

is— 

‘‘(i) a rating system that uses up to 5 stars to 

rate clinical quality and enrollee satisfaction and 

performance at the Medicare Advantage contract or 

MA plan level; or 

‘‘(ii) such other system established by the Secretary 

that provides for the determination of a comparable 

quality performance rating to the rating system 

described in clause (i). 

‘‘(D) DATA USED IN DETERMINING SCORE.— 

‘‘(i) IN GENERAL.—The rating of an MA plan under 

the rating system described in subparagraph (C) with 

respect to a year shall be based on based on the most 

recent data available. 

‘‘(ii) PLANS THAT FAIL TO REPORT DATA.—An MA 

plan which does not report data that enables the Secretary to rate the plan for purposes of subparagraph 

(A) or identify the plan for purposes of subparagraph 

(B) shall be counted, for purposes of such rating or 

identification, as having the lowest plan performance 

rating and the lowest percentage improvement, respectively. 

‘‘(3) QUALITY BONUS FOR NEW AND LOW ENROLLMENT MA

PLANS.— ‘‘(A) NEW MA PLANS.—For years beginning with 2014, 

in the case of an MA plan that first submits a bid under 

section 1854(a)(1)(A) for 2012 or a subsequent year, only 

receives enrollments made during the coverage election 

periods described in section 1851(e), and is not able to 

receive a bonus under subparagraph (A) or (B) of paragraph 

(2) for the year, the Secretary shall, in addition to any 

other payment provided under this part, make monthly 

payments, with respect to coverage of an individual under 

this part, to the MA plan in an amount equal to 2 percent 

of national monthly per capita cost for expenditures for 
H. R. 3590—332 

individuals enrolled under the original medicare fee-forservice program for the year. In its fourth year of operation, 

the MA plan shall be paid in the same manner as other 

MA plans with comparable enrollment. 

‘‘(B) LOW ENROLLMENT PLANS.—For years beginning 

with 2014, in the case of an MA plan that has low enrollment (as defined by the Secretary) and would not otherwise 

be able to receive a bonus under subparagraph (A) or 

(B) of paragraph (2) or subparagraph (A) of this paragraph 

for the year (referred to in this subparagraph as a ‘low 

enrollment plan’), the Secretary shall use a regional or 

local mean of the rating of all MA plans in the region 

or local area, as determined appropriate by the Secretary, 

on measures used to determine whether MA plans are 

eligible for a quality or an improved quality bonus, as 

applicable, to determine whether the low enrollment plan 

is eligible for a bonus under such a subparagraph. 

‘‘(4) RISK ADJUSTMENT.—The Secretary shall risk adjust 

a performance bonus under this subsection in the same manner 

as the Secretary risk adjusts beneficiary rebates described in 

section 1854(b)(1)(C). 

‘‘(5) NOTIFICATION.—The Secretary, in the annual 

announcement required under subsection (b)(1)(B) for 2014 and 

each succeeding year, shall notify the Medicare Advantage 

organization of any performance bonus (including a care 

coordination and management performance bonus under paragraph (1), a quality performance bonus under paragraph (2), 

and a quality bonus for new and low enrollment plans under 

paragraph (3)) that the organization will receive under this 

subsection with respect to the year. The Secretary shall provide 

for the publication of the information described in the previous 

sentence on the Internet website of the Centers for Medicare 

& Medicaid Services.’’ 

(B) CONFORMING AMENDMENT.—Section 1853(a)(1)(B) 

of the Social Security Act (42 U.S.C. 1395w–23(a)(1)(B)) 

is amended— 

(i) in clause (i), by inserting ‘‘and any performance 

bonus under subsection (n)’’ before the period at the 

end; and 

(ii) in clause (ii), by striking ‘‘(G)’’ and inserting 

‘‘(G), plus the amount (if any) of any performance bonus 

under subsection (n)’’. 

(2) APPLICATION OF PERFORMANCE BONUSES TO MA

REGIONAL PLANS.—Section 1858 of the Social Security Act (42 

U.S.C. 1395w–27a) is amended— 

(A) in subsection (f)(1), by striking ‘‘subsection (e)’’ 

and inserting ‘‘subsections (e) and (i)’’; and 

(B) by adding at the end the following new subsection: 

‘‘(i) APPLICATION OF PERFORMANCE BONUSES TO MA REGIONAL

PLANS.—For years beginning with 2014, the Secretary shall apply 

the performance bonuses under section 1853(n) (relating to bonuses 

for care coordination and management, quality performance, and 

new and low enrollment MA plans) to MA regional plans in a 

similar manner as such performance bonuses apply to MA plans 

under such subsection.’’. 

(g) GRANDFATHERING SUPPLEMENTAL BENEFITS FOR CURRENT

ENROLLEES AFTER IMPLEMENTATION OF COMPETITIVE BIDDING.— 
H. R. 3590—333 

Section 1853 of the Social Security Act (42 U.S.C. 1395w–23), as 

amended by subsection (f), is amended by adding at the end the 

following new subsection: 

‘‘(o) GRANDFATHERING SUPPLEMENTAL BENEFITS FOR CURRENT

ENROLLES AFTER IMPLEMENTATION OF COMPETITIVE BIDDING.— 

‘‘(1) IDENTIFICATION OF AREAS.—The Secretary shall identify MA local areas in which, with respect to 2009, average 

bids submitted by an MA organization under section 1854(a) 

for MA local plans in the area are not greater than 75 percent 

of the adjusted average per capita cost for the year involved, 

determined under section 1876(a)(4), for the area for individuals 

who are not enrolled in an MA plan under this part for the 

year, but adjusted to exclude costs attributable to payments 

under section 1848(o), 1886(n), and 1886(h). 

‘‘(2) ELECTION TO PROVIDE REBATES TO GRANDFATHERED

ENROLLEES.— 

‘‘(A) IN GENERAL.—For years beginning with 2012, each 

Medicare Advantage organization offering an MA local plan 

in an area identified by the Secretary under paragraph 

(1) may elect to provide rebates to grandfathered enrollees 

under section 1854(b)(1)(C). In the case where an MA 

organization makes such an election, the monthly per 

capita dollar amount of such rebates shall not exceed the 

applicable amount for the year (as defined in subparagraph 

(B)). 

‘‘(B) APPLICABLE AMOUNT.—For purposes of this subsection, the term ‘applicable amount’ means— 

‘‘(i) for 2012, the monthly per capita dollar amount 

of such rebates provided to enrollees under the MA 

local plan with respect to 2011; and 

‘‘(ii) for a subsequent year, 95 percent of the 

amount determined under this subparagraph for the 

preceding year. 

‘‘(3) SPECIAL RULES FOR PLANS IN IDENTIFIED AREAS.—Notwithstanding any other provision of this part, the following 

shall apply with respect to each Medicare Advantage organization offering an MA local plan in an area identified by the 

Secretary under paragraph (1) that makes an election described 

in paragraph (2): 

‘‘(A) PAYMENTS.—The amount of the monthly payment 

under this section to the Medicare Advantage organization, 

with respect to coverage of a grandfathered enrollee under 

this part in the area for a month, shall be equal to— 

‘‘(i) for 2012 and 2013, the sum of— 

‘‘(I) the bid amount under section 1854(a) for 

the MA local plan; and 

‘‘(II) the applicable amount (as defined in paragraph (2)(B)) for the MA local plan for the year. 

‘‘(ii) for 2014 and subsequent years, the sum of— 

‘‘(I) the MA competitive benchmark amount 

under subsection (j)(1)(A)(i) for the area for the 

month, adjusted, only to the extent the Secretary 

determines necessary, to account for induced utilization as a result of rebates provided to grandfathered enrollees (except that such adjustment 

shall not exceed 0.5 percent of such MA competitive benchmark amount); and 
H. R. 3590—334 

‘‘(II) the applicable amount (as so defined) for 

the MA local plan for the year. 

‘‘(B) REQUIREMENT TO SUBMIT BIDS UNDER COMPETITIVE

BIDDING.—The Medicare Advantage organization shall 

submit a single bid amount under section 1854(a) for the 

MA local plan. The Medicare Advantage organization shall 

remove from such bid amount any effects of induced 

demand for care that may result from the higher rebates 

available to grandfathered enrollees under this subsection. 

‘‘(C) NONAPPLICATION OF BONUS PAYMENTS AND ANY

OTHER REBATES.—The Medicare Advantage organization 

offering the MA local plan shall not be eligible for any 

bonus payment under subsection (n) or any rebate under 

this part (other than as provided under this subsection) 

with respect to grandfathered enrollees. 

‘‘(D) NONAPPLICATION OF UNIFORM BID AND PREMIUM

AMOUNTS TO GRANDFATHERED ENROLLEES.—Section 1854(c) 

shall not apply with respect to the MA local plan. 

‘‘(E) NONAPPLICATION OF LIMITATION ON APPLICATION

OF PLAN REBATES TOWARD PAYMENT OF PART B PREMIUM.— 

Notwithstanding clause (iii) of section 1854(b)(1)(C), in the 

case of a grandfathered enrollee, a rebate under such section may be used for the purpose described in clause (ii)(III) 

of such section. 

‘‘(F) RISK ADJUSTMENT.—The Secretary shall risk 

adjust rebates to grandfathered enrollees under this subsection in the same manner as the Secretary risk adjusts 

beneficiary rebates described in section 1854(b)(1)(C). 

‘‘(4) DEFINITION OF GRANDFATHERED ENROLLEE.—In this 

subsection, the term ‘grandfathered enrollee’ means an individual who is enrolled (effective as of the date of enactment 

of this subsection) in an MA local plan in an area that is 

identified by the Secretary under paragraph (1).’’. 

(h) TRANSITIONAL EXTRA BENEFITS.—Section 1853 of the Social 

Security Act (42 U.S.C. 1395w–23), as amended by subsections 

(f) and (g), is amended by adding at the end the following new 

subsection: 

‘‘(p) TRANSITIONAL EXTRA BENEFITS.— ‘‘(1) IN GENERAL.—For years beginning with 2012, the Secretary shall provide transitional rebates under section 

1854(b)(1)(C) for the provision of extra benefits (as specified 

by the Secretary) to enrollees described in paragraph (2). 

‘‘(2) ENROLLEES DESCRIBED.—An enrollee described in this 

paragraph is an individual who— 

‘‘(A) enrolls in an MA local plan in an applicable area; 

and 

‘‘(B) experiences a significant reduction in extra benefits described in clause (ii) of section 1854(b)(1)(C) as a 

result of competitive bidding under this part (as determined 

by the Secretary). 

‘‘(3) APPLICABLE AREAS.—In this subsection, the term 

‘applicable area’ means the following: 

‘‘(A) The 2 largest metropolitan statistical areas, if 

the Secretary determines that the total amount of such 

extra benefits for each enrollee for the month in those 

areas is greater than $100. 

‘‘(B) A county where— 
H. R. 3590—335 

‘‘(i) the MA area-specific non-drug monthly benchmark amount for a month in 2011 is equal to the 

legacy urban floor amount (as described in subsection 

(c)(1)(B)(iii)), as determined by the Secretary for the 

area for 2011; 

‘‘(ii) the percentage of Medicare Advantage eligible 

beneficiaries in the county who are enrolled in an 

MA plan for 2009 is greater than 30 percent (as determined by the Secretary); and 

‘‘(iii) average bids submitted by an MA organization under section 1854(a) for MA local plans in the 

county for 2011 are not greater than the adjusted 

average per capita cost for the year involved, determined under section 1876(a)(4), for the county for 

individuals who are not enrolled in an MA plan under 

this part for the year, but adjusted to exclude costs 

attributable to payments under section 1848(o), 

1886(n), and 1886(h). 

‘‘(C) If the Secretary determines appropriate, a county 

contiguous to an area or county described in subparagraph 

(A) or (B), respectively. 

‘‘(4) REVIEW OF PLAN BIDS.—In the case of a bid submitted 

by an MA organization under section 1854(a) for an MA local 

plan in an applicable area, the Secretary shall review such 

bid in order to ensure that extra benefits (as specified by 

the Secretary) are provided to enrollees described in paragraph 

(2). 

‘‘(5) FUNDING.—The Secretary shall provide for the transfer 

from the Federal Hospital Insurance Trust Fund under section 

1817 and the Federal Supplementary Medical Insurance Trust 

Fund established under section 1841, in such proportion as 

the Secretary determines appropriate, of an amount not to 

exceed $5,000,000,000 for the period of fiscal years 2012 

through 2019 for the purpose of providing transitional rebates 

under section 1854(b)(1)(C) for the provision of extra benefits 

under this subsection.’’. 

(i) NONAPPLICATION OF COMPETITIVE BIDDING AND RELATED

PROVISIONS AND CLARIFICATION OF MA PAYMENT AREA FOR PACE 

PROGRAMS.— 

(1) NONAPPLICATION OF COMPETITIVE BIDDING AND RELATED

PROVISIONS FOR PACE PROGRAMS.—Section 1894 of the Social 

Security Act (42 U.S.C. 1395eee) is amended— 

(A) by redesignating subsections (h) and (i) as subsections (i) and (j), respectively; 

(B) by inserting after subsection (g) the following new 

subsection: 

‘‘(h) NONAPPLICATION OF COMPETITIVE BIDDING AND RELATED

PROVISIONS UNDER PART C.—With respect to a PACE program 

under this section, the following provisions (and regulations relating 

to such provisions) shall not apply: 

‘‘(1) Section 1853(j)(1)(A)(i), relating to MA area-specific 

non-drug monthly benchmark amount being based on competitive bids. 

‘‘(2) Section 1853(d)(5), relating to the establishment of 

MA local plan service areas. 

‘‘(3) Section 1853(n), relating to the payment of performance 

bonuses. 
H. R. 3590—336 

‘‘(4) Section 1853(o), relating to grandfathering supplemental benefits for current enrollees after implementation of 

competitive bidding. 

‘‘(5) Section 1853(p), relating to transitional extra benefits.’’. 

(2) SPECIAL RULE FOR MA PAYMENT AREA FOR PACE PROGRAMS.—Section 1853(d) of the Social Security Act (42 U.S.C. 

1395w–23(d)), as amended by subsection (e), is amended by 

adding at the end the following new paragraph: 

‘‘(6) SPECIAL RULE FOR MA PAYMENT AREA FOR PACE PRO- GRAMS.—For years beginning with 2012, in the case of a PACE 

program under section 1894, the MA payment area shall be 

the MA local area (as defined in paragraph (2)).’’. 

SEC. 3202. BENEFIT PROTECTION AND SIMPLIFICATION. 

(a) LIMITATION ON VARIATION OF COST SHARING FOR CERTAIN

BENEFITS.— 

(1) IN GENERAL.—Section 1852(a)(1)(B) of the Social Security Act (42 U.S.C. 1395w–22(a)(1)(B)) is amended— 

(A) in clause (i), by inserting ‘‘, subject to clause (iii),’’ 

after ‘‘and B or’’; and 

(B) by adding at the end the following new clauses: 

‘‘(iii) LIMITATION ON VARIATION OF COST SHARING

FOR CERTAIN BENEFITS.—Subject to clause (v), costsharing for services described in clause (iv) shall not 

exceed the cost-sharing required for those services 

under parts A and B. 

‘‘(iv) SERVICES DESCRIBED.—The following services 

are described in this clause: 

‘‘(I) Chemotherapy administration services. 

‘‘(II) Renal dialysis services (as defined in section 1881(b)(14)(B)). 

‘‘(III) Skilled nursing care. 

‘‘(IV) Such other services that the Secretary 

determines appropriate (including services that the 

Secretary determines require a high level of 

predictability and transparency for beneficiaries). 

‘‘(v) EXCEPTION.—In the case of services described 

in clause (iv) for which there is no cost-sharing required 

under parts A and B, cost-sharing may be required 

for those services in accordance with clause (i).’’. 

(2) EFFECTIVE DATE.—The amendments made by this subsection shall apply to plan years beginning on or after January 

1, 2011. 

(b) APPLICATION OF REBATES, PERFORMANCE BONUSES, AND

PREMIUMS.— 

(1) APPLICATION OF REBATES.—Section 1854(b)(1)(C) of the 

Social Security Act (42 U.S.C. 1395w–24(b)(1)(C)) is amended— 

(A) in clause (ii), by striking ‘‘REBATE.—A rebate’’ and 

inserting ‘‘REBATE FOR PLAN YEARS BEFORE 2012.—For plan 

years before 2012, a rebate’’; 

(B) by redesignating clauses (iii) and (iv) as clauses 

(iv) and (v); and 

(C) by inserting after clause (ii) the following new 

clause: 

‘‘(iii) FORM OF REBATE FOR PLAN YEAR 2012 AND

SUBSEQUENT PLAN YEARS.—For plan years beginning 

on or after January 1, 2012, a rebate required under 
H. R. 3590—337 

this subparagraph may not be used for the purpose 

described in clause (ii)(III) and shall be provided 

through the application of the amount of the rebate 

in the following priority order: 

‘‘(I) First, to use the most significant share 

to meaningfully reduce cost-sharing otherwise 

applicable for benefits under the original medicare 

fee-for-service program under parts A and B and 

for qualified prescription drug coverage under part 

D, including the reduction of any deductibles, copayments, and maximum limitations on out-ofpocket expenses otherwise applicable. Any reduction of maximum limitations on out-of-pocket 

expenses under the preceding sentence shall apply 

to all benefits under the original medicare feefor-service program option. The Secretary may provide guidance on meaningfully reducing costsharing under this subclause, except that such 

guidance may not require a particular amount of 

cost-sharing or reduction in cost-sharing. 

‘‘(II) Second, to use the next most significant 

share to meaningfully provide coverage of preventive and wellness health care benefits (as defined 

by the Secretary) which are not benefits under 

the original medicare fee-for-service program, such 

as smoking cessation, a free flu shot, and an 

annual physical examination. 

‘‘(III) Third, to use the remaining share to 

meaningfully provide coverage of other health care 

benefits which are not benefits under the original 

medicare fee-for-service program, such as eye 

examinations and dental coverage, and are not 

benefits described in subclause (II).’’. 

(2) APPLICATION OF PERFORMANCE BONUSES.—Section 

1853(n) of the Social Security Act, as added by section 3201(f), 

is amended by adding at the end the following new paragraph: 

‘‘(6) APPLICATION OF PERFORMANCE BONUSES.—For plan 

years beginning on or after January 1, 2014, any performance 

bonus paid to an MA plan under this subsection shall be 

used for the purposes, and in the priority order, described 

in subclauses (I) through (III) of section 1854(b)(1)(C)(iii).’’. 

(3) APPLICATION OF MA MONTHLY SUPPLEMENTARY BENEFICIARY PREMIUM.—Section 1854(b)(2)(C) of the Social Security 

Act (42 U.S.C. 1395w–24(b)(2)(C)) is amended— 

(A) by striking ‘‘PREMIUM.—The term’’ and inserting 

‘‘PREMIUM.— 

‘‘(i) IN GENERAL.—The term’’; and 

(B) by adding at the end the following new clause: 

‘‘(ii) APPLICATION OF MA MONTHLY SUPPLEMENTARY

BENEFICIARY PREMIUM.—For plan years beginning on 

or after January 1, 2012, any MA monthly supplementary beneficiary premium charged to an individual 

enrolled in an MA plan shall be used for the purposes, 

and in the priority order, described in subclauses (I) 

through (III) of paragraph (1)(C)(iii).’’. 
H. R. 3590—338 

SEC. 3203. APPLICATION OF CODING INTENSITY ADJUSTMENT DURING 

MA PAYMENT TRANSITION. 

Section 1853(a)(1)(C) of the Social Security Act (42 U.S.C. 

1395w–23(a)(1)(C)) is amended by adding at the end the following 

new clause: 

‘‘(iii) APPLICATION OF CODING INTENSITY ADJUSTMENT FOR 2011 AND SUBSEQUENT YEARS.— 

‘‘(I) REQUIREMENT TO APPLY IN 2011 THROUGH

2013.—In order to ensure payment accuracy, the 

Secretary shall conduct an analysis of the differences described in clause (ii)(I). The Secretary 

shall ensure that the results of such analysis are 

incorporated into the risk scores for 2011, 2012, 

and 2013. 

‘‘(II) AUTHORITY TO APPLY IN 2014 AND SUBSEQUENT YEARS.—The Secretary may, as appropriate, 

incorporate the results of such analysis into the 

risk scores for 2014 and subsequent years.’’. 

SEC. 3204. SIMPLIFICATION OF ANNUAL BENEFICIARY ELECTION 

PERIODS. 

(a) ANNUAL 45-DAY PERIOD FOR DISENROLLMENT FROM MA 

PLANS TO ELECT TO RECEIVE BENEFITS UNDER THE ORIGINAL MEDICARE FEE-FOR-SERVICE PROGRAM.— 

(1) IN GENERAL.—Section 1851(e)(2)(C) of the Social Security Act (42 U.S.C. 1395w–1(e)(2)(C)) is amended to read as 

follows: 

‘‘(C) ANNUAL 45-DAY PERIOD FOR DISENROLLMENT FROM

MA PLANS TO ELECT TO RECEIVE BENEFITS UNDER THE

ORIGINAL MEDICARE FEE-FOR-SERVICE PROGRAM.—Subject to 

subparagraph (D), at any time during the first 45 days 

of a year (beginning with 2011), an individual who is 

enrolled in a Medicare Advantage plan may change the 

election under subsection (a)(1), but only with respect to 

coverage under the original medicare fee-for-service program under parts A and B, and may elect qualified 

prescription drug coverage in accordance with section 

1860D–1.’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply with respect to 2011 and succeeding years. 

(b) TIMING OF THE ANNUAL, COORDINATED ELECTION PERIOD

UNDER PARTS C AND D.—Section 1851(e)(3)(B) of the Social Security 

Act (42 U.S.C. 1395w–1(e)(3)(B)) is amended— 

(1) in clause (iii), by striking ‘‘and’’ at the end; 

(2) in clause (iv)— 

(A) by striking ‘‘and succeeding years’’ and inserting 

‘‘, 2008, 2009, and 2010’’; and 

(B) by striking the period at the end and inserting 

‘‘; and’’; and 

(3) by adding at the end the following new clause: 

‘‘(v) with respect to 2012 and succeeding years, 

the period beginning on October 15 and ending on 

December 7 of the year before such year.’’. 
H. R. 3590—339 

SEC. 3205. EXTENSION FOR SPECIALIZED MA PLANS FOR SPECIAL 

NEEDS INDIVIDUALS. 

(a) EXTENSION OF SNP AUTHORITY.—Section 1859(f)(1) of the 

Social Security Act (42 U.S.C. 1395w–28(f)(1)), as amended by section 164(a) of the Medicare Improvements for Patients and Providers Act of 2008 (Public Law 110–275), is amended by striking 

‘‘2011’’ and inserting ‘‘2014’’. 

(b) AUTHORITY TO APPLY FRAILTY ADJUSTMENT UNDER PACE 

PAYMENT RULES.—Section 1853(a)(1)(B) of the Social Security Act 

(42 U.S.C. 1395w–23(a)(1)(B)) is amended by adding at the end 

the following new clause: 

‘‘(iv) AUTHORITY TO APPLY FRAILTY ADJUSTMENT

UNDER PACE PAYMENT RULES FOR CERTAIN SPECIALIZED

MA PLANS FOR SPECIAL NEEDS INDIVIDUALS.— ‘‘(I) IN GENERAL.—Notwithstanding the preceding provisions of this paragraph, for plan year 

2011 and subsequent plan years, in the case of 

a plan described in subclause (II), the Secretary 

may apply the payment rules under section 1894(d) 

(other than paragraph (3) of such section) rather 

than the payment rules that would otherwise apply 

under this part, but only to the extent necessary 

to reflect the costs of treating high concentrations 

of frail individuals. 

‘‘(II) PLAN DESCRIBED.—A plan described in 

this subclause is a specialized MA plan for special 

needs individuals described in section 

1859(b)(6)(B)(ii) that is fully integrated with 

capitated contracts with States for Medicaid benefits, including long-term care, and that have 

similar average levels of frailty (as determined 

by the Secretary) as the PACE program.’’. 

(c) TRANSITION AND EXCEPTION REGARDING RESTRICTION ON

ENROLLMENT.—Section 1859(f) of the Social Security Act (42 U.S.C. 

1395w–28(f)) is amended by adding at the end the following new 

paragraph: 

‘‘(6) TRANSITION AND EXCEPTION REGARDING RESTRICTION

ON ENROLLMENT.— ‘‘(A) IN GENERAL.—Subject to subparagraph (C), the 

Secretary shall establish procedures for the transition of 

applicable individuals to— 

‘‘(i) a Medicare Advantage plan that is not a 

specialized MA plan for special needs individuals (as 

defined in subsection (b)(6)); or 

‘‘(ii) the original medicare fee-for-service program 

under parts A and B. 

‘‘(B) APPLICABLE INDIVIDUALS.—For purposes of clause 

(i), the term ‘applicable individual’ means an individual 

who— 

‘‘(i) is enrolled under a specialized MA plan for 

special needs individuals (as defined in subsection 

(b)(6)); and 

‘‘(ii) is not within the 1 or more of the classes 

of special needs individuals to which enrollment under 

the plan is restricted to. 

‘‘(C) EXCEPTION.—The Secretary shall provide for an 

exception to the transition described in subparagraph (A) 
H. R. 3590—340 

for a limited period of time for individuals enrolled under 

a specialized MA plan for special needs individuals 

described in subsection (b)(6)(B)(ii) who are no longer 

eligible for medical assistance under title XIX. 

‘‘(D) TIMELINE FOR INITIAL TRANSITION.—The Secretary 

shall ensure that applicable individuals enrolled in a 

specialized MA plan for special needs individuals (as 

defined in subsection (b)(6)) prior to January 1, 2010, are 

transitioned to a plan or the program described in subparagraph (A) by not later than January 1, 2013.’’. 

(d) TEMPORARY EXTENSION OF AUTHORITY TO OPERATE BUT

NO SERVICE AREA EXPANSION FOR DUAL SPECIAL NEEDS PLANS

THAT DO NOT MEET CERTAIN REQUIREMENTS.—Section 164(c)(2) 

of the Medicare Improvements for Patients and Providers Act of 

2008 (Public Law 110–275) is amended by striking ‘‘December 31, 

2010’’ and inserting ‘‘December 31, 2012’’. 

(e) AUTHORITY TO REQUIRE SPECIAL NEEDS PLANS BE NCQA 

APPROVED.—Section 1859(f) of the Social Security Act (42 U.S.C. 

1395w–28(f)), as amended by subsections (a) and (c), is amended— 

(1) in paragraph (2), by adding at the end the following 

new subparagraph: 

‘‘(C) If applicable, the plan meets the requirement 

described in paragraph (7).’’; 

(2) in paragraph (3), by adding at the end the following 

new subparagraph: 

‘‘(E) If applicable, the plan meets the requirement 

described in paragraph (7).’’; 

(3) in paragraph (4), by adding at the end the following 

new subparagraph: 

‘‘(C) If applicable, the plan meets the requirement 

described in paragraph (7).’’; and 

(4) by adding at the end the following new paragraph: 

‘‘(7) AUTHORITY TO REQUIRE SPECIAL NEEDS PLANS BE NCQA

APPROVED.—For 2012 and subsequent years, the Secretary shall 

require that a Medicare Advantage organization offering a 

specialized MA plan for special needs individuals be approved 

by the National Committee for Quality Assurance (based on 

standards established by the Secretary).’’. 

(f) RISK ADJUSTMENT.—Section 1853(a)(1)(C) of the Social Security Act (42 U.S.C. 1395i–23(a)(1)(C)) is amended by adding at 

the end the following new clause: 

‘‘(iii) IMPROVEMENTS TO RISK ADJUSTMENT FOR SPECIAL NEEDS INDIVIDUALS WITH CHRONIC HEALTH CONDITIONS.— 

‘‘(I) IN GENERAL.—For 2011 and subsequent 

years, for purposes of the adjustment under clause 

(i) with respect to individuals described in subclause (II), the Secretary shall use a risk score 

that reflects the known underlying risk profile and 

chronic health status of similar individuals. Such 

risk score shall be used instead of the default 

risk score for new enrollees in Medicare Advantage 

plans that are not specialized MA plans for special 

needs individuals (as defined in section 1859(b)(6)). 

‘‘(II) INDIVIDUALS DESCRIBED.—An individual 

described in this subclause is a special needs individual described in subsection (b)(6)(B)(iii) who 
H. R. 3590—341 

enrolls in a specialized MA plan for special needs 

individuals on or after January 1, 2011. 

‘‘(III) EVALUATION.—For 2011 and periodically 

thereafter, the Secretary shall evaluate and revise 

the risk adjustment system under this subparagraph in order to, as accurately as possible, 

account for higher medical and care coordination 

costs associated with frailty, individuals with multiple, comorbid chronic conditions, and individuals 

with a diagnosis of mental illness, and also to 

account for costs that may be associated with 

higher concentrations of beneficiaries with those 

conditions. 

‘‘(IV) PUBLICATION OF EVALUATION AND REVISIONS.—The Secretary shall publish, as part of 

an announcement under subsection (b), a description of any evaluation conducted under subclause 

(III) during the preceding year and any revisions 

made under such subclause as a result of such 

evaluation.’’. 

(g) TECHNICAL CORRECTION.—Section 1859(f)(5) of the Social 

Security Act (42 U.S.C. 1395w–28(f)(5)) is amended, in the matter 

preceding subparagraph (A), by striking ‘‘described in subsection 

(b)(6)(B)(i)’’. 

SEC. 3206. EXTENSION OF REASONABLE COST CONTRACTS. 

Section 1876(h)(5)(C)(ii) of the Social Security Act (42 U.S.C. 

1395mm(h)(5)(C)(ii)) is amended, in the matter preceding subclause 

(I), by striking ‘‘January 1, 2010’’ and inserting ‘‘January 1, 2013’’. 

SEC. 3207. TECHNICAL CORRECTION TO MA PRIVATE FEE-FORSERVICE PLANS. 

For plan year 2011 and subsequent plan years, to the extent 

that the Secretary of Health and Human Services is applying the 

2008 service area extension waiver policy (as modified in the April 

11, 2008, Centers for Medicare & Medicaid Services’ memorandum 

with the subject ‘‘2009 Employer Group Waiver-Modification of the 

2008 Service Area Extension Waiver Granted to Certain MA Local 

Coordinated Care Plans’’) to Medicare Advantage coordinated care 

plans, the Secretary shall extend the application of such waiver 

policy to employers who contract directly with the Secretary as 

a Medicare Advantage private fee-for-service plan under section 

1857(i)(2) of the Social Security Act (42 U.S.C. 1395w–27(i)(2)) 

and that had enrollment as of October 1, 2009. 

SEC. 3208. MAKING SENIOR HOUSING FACILITY DEMONSTRATION 

PERMANENT. 

(a) IN GENERAL.—Section 1859 of the Social Security Act (42 

U.S.C. 1395w–28) is amended by adding at the end the following 

new subsection: 

‘‘(g) SPECIAL RULES FOR SENIOR HOUSING FACILITY PLANS.— ‘‘(1) IN GENERAL.—In the case of a Medicare Advantage 

senior housing facility plan described in paragraph (2), notwithstanding any other provision of this part to the contrary and 

in accordance with regulations of the Secretary, the service 

area of such plan may be limited to a senior housing facility 

in a geographic area. 
H. R. 3590—342 

‘‘(2) MEDICARE ADVANTAGE SENIOR HOUSING FACILITY PLAN

DESCRIBED.—For purposes of this subsection, a Medicare 

Advantage senior housing facility plan is a Medicare Advantage 

plan that— 

‘‘(A) restricts enrollment of individuals under this part 

to individuals who reside in a continuing care retirement 

community (as defined in section 1852(l)(4)(B)); 

‘‘(B) provides primary care services onsite and has 

a ratio of accessible physicians to beneficiaries that the 

Secretary determines is adequate; 

‘‘(C) provides transportation services for beneficiaries 

to specialty providers outside of the facility; and 

‘‘(D) has participated (as of December 31, 2009) in 

a demonstration project established by the Secretary under 

which such a plan was offered for not less than 1 year.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect on January 1, 2010, and shall apply to plan 

years beginning on or after such date. 

SEC. 3209. AUTHORITY TO DENY PLAN BIDS. 

(a) IN GENERAL.—Section 1854(a)(5) of the Social Security Act 

(42 U.S.C. 1395w–24(a)(5)) is amended by adding at the end the 

following new subparagraph: 

‘‘(C) REJECTION OF BIDS.— ‘‘(i) IN GENERAL.—Nothing in this section shall be 

construed as requiring the Secretary to accept any 

or every bid submitted by an MA organization under 

this subsection. 

‘‘(ii) AUTHORITY TO DENY BIDS THAT PROPOSE

SIGNIFICANT INCREASES IN COST SHARING OR DECREASES

IN BENEFITS.—The Secretary may deny a bid submitted 

by an MA organization for an MA plan if it proposes 

significant increases in cost sharing or decreases in 

benefits offered under the plan.’’. 

(b) APPLICATION UNDER PART D.—Section 1860D–11(d) of such 

Act (42 U.S.C. 1395w–111(d)) is amended by adding at the end 

the following new paragraph: 

‘‘(3) REJECTION OF BIDS.—Paragraph (5)(C) of section 

1854(a) shall apply with respect to bids submitted by a PDP 

sponsor under subsection (b) in the same manner as such 

paragraph applies to bids submitted by an MA organization 

under such section 1854(a).’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to bids submitted for contract years beginning on or 

after January 1, 2011. 

SEC. 3210. DEVELOPMENT OF NEW STANDARDS FOR CERTAIN 

MEDIGAP PLANS. 

(a) IN GENERAL.—Section 1882 of the Social Security Act (42 

U.S.C. 1395ss) is amended by adding at the end the following 

new subsection: 

‘‘(y) DEVELOPMENT OF NEW STANDARDS FOR CERTAIN MEDICARE

SUPPLEMENTAL POLICIES.— 

‘‘(1) IN GENERAL.—The Secretary shall request the National 

Association of Insurance Commissioners to review and revise 

the standards for benefit packages described in paragraph (2) 

under subsection (p)(1), to otherwise update standards to 

include requirements for nominal cost sharing to encourage 
H. R. 3590—343 

the use of appropriate physicians’ services under part B. Such 

revisions shall be based on evidence published in peer-reviewed 

journals or current examples used by integrated delivery systems and made consistent with the rules applicable under 

subsection (p)(1)(E) with the reference to the ‘1991 NAIC Model 

Regulation’ deemed a reference to the NAIC Model Regulation 

as published in the Federal Register on December 4, 1998, 

and as subsequently updated by the National Association of 

Insurance Commissioners to reflect previous changes in law 

and the reference to ‘date of enactment of this subsection’ 

deemed a reference to the date of enactment of the Patient 

Protection and Affordable Care Act. To the extent practicable, 

such revision shall provide for the implementation of revised 

standards for benefit packages as of January 1, 2015. 

‘‘(2) BENEFIT PACKAGES DESCRIBED.—The benefit packages 

described in this paragraph are benefit packages classified as 

‘C’ and ‘F’.’’. 

(b) CONFORMING AMENDMENT.—Section 1882(o)(1) of the Social 

Security Act (42 U.S.C. 1395ss(o)(1)) is amended by striking ‘‘, 

and (w)’’ and inserting ‘‘(w), and (y)’’. 

Subtitle D—Medicare Part D Improvements for Prescription Drug Plans and 

MA–PD Plans 

SEC. 3301. MEDICARE COVERAGE GAP DISCOUNT PROGRAM. 

(a) CONDITION FOR COVERAGE OF DRUGS UNDER PART D.— 

Part D of Title XVIII of the Social Security Act (42 U.S.C. 1395w– 

101 et seq.), is amended by adding at the end the following new 

section: 

‘‘CONDITION FOR COVERAGE OF DRUGS UNDER THIS PART

‘‘SEC. 1860D–43. (a) IN GENERAL.—In order for coverage to 

be available under this part for covered part D drugs (as defined 

in section 1860D–2(e)) of a manufacturer, the manufacturer must— 

‘‘(1) participate in the Medicare coverage gap discount program under section 1860D–14A; 

‘‘(2) have entered into and have in effect an agreement 

described in subsection (b) of such section with the Secretary; 

and 

‘‘(3) have entered into and have in effect, under terms 

and conditions specified by the Secretary, a contract with a 

third party that the Secretary has entered into a contract 

with under subsection (d)(3) of such section. 

‘‘(b) EFFECTIVE DATE.—Subsection (a) shall apply to covered 

part D drugs dispensed under this part on or after July 1, 2010. 

‘‘(c) AUTHORIZING COVERAGE FOR DRUGS NOT COVERED UNDER

AGREEMENTS.—Subsection (a) shall not apply to the dispensing 

of a covered part D drug if— 

‘‘(1) the Secretary has made a determination that the availability of the drug is essential to the health of beneficiaries 

under this part; or 
H. R. 3590—344 

‘‘(2) the Secretary determines that in the period beginning 

on July 1, 2010, and ending on December 31, 2010, there 

were extenuating circumstances. 

‘‘(d) DEFINITION OF MANUFACTURER.—In this section, the term 

‘manufacturer’ has the meaning given such term in section 1860D– 

14A(g)(5).’’. 

(b) MEDICARE COVERAGE GAP DISCOUNT PROGRAM.—Part D 

of title XVIII of the Social Security Act (42 U.S.C. 1395w–101) 

is amended by inserting after section 1860D–14 the following new 

section: 

‘‘MEDICARE COVERAGE GAP DISCOUNT PROGRAM

‘‘SEC. 1860D–14A. (a) ESTABLISHMENT.—The Secretary shall 

establish a Medicare coverage gap discount program (in this section 

referred to as the ‘program’) by not later than July 1, 2010. Under 

the program, the Secretary shall enter into agreements described 

in subsection (b) with manufacturers and provide for the performance of the duties described in subsection (c)(1). The Secretary 

shall establish a model agreement for use under the program by 

not later than April 1, 2010, in consultation with manufacturers, 

and allow for comment on such model agreement. 

‘‘(b) TERMS OF AGREEMENT.— 

‘‘(1) IN GENERAL.— 

‘‘(A) AGREEMENT.—An agreement under this section 

shall require the manufacturer to provide applicable beneficiaries access to discounted prices for applicable drugs 

of the manufacturer. 

‘‘(B) PROVISION OF DISCOUNTED PRICES AT THE POINT- OF-SALE.—Except as provided in subsection (c)(1)(A)(iii), 

such discounted prices shall be provided to the applicable 

beneficiary at the pharmacy or by the mail order service 

at the point-of-sale of an applicable drug. 

‘‘(C) TIMING OF AGREEMENT.— ‘‘(i) SPECIAL RULE FOR 2010 AND 2011.—In order 

for an agreement with a manufacturer to be in effect 

under this section with respect to the period beginning 

on July 1, 2010, and ending on December 31, 2011, 

the manufacturer shall enter into such agreement not 

later than May 1, 2010. 

‘‘(ii) 2012 AND SUBSEQUENT YEARS.—In order for 

an agreement with a manufacturer to be in effect under 

this section with respect to plan year 2012 or a subsequent plan year, the manufacturer shall enter into 

such agreement (or such agreement shall be renewed 

under paragraph (4)(A)) not later than January 30 

of the preceding year. 

‘‘(2) PROVISION OF APPROPRIATE DATA.—Each manufacturer 

with an agreement in effect under this section shall collect 

and have available appropriate data, as determined by the 

Secretary, to ensure that it can demonstrate to the Secretary 

compliance with the requirements under the program. 

‘‘(3) COMPLIANCE WITH REQUIREMENTS FOR ADMINISTRATION

OF PROGRAM.—Each manufacturer with an agreement in effect 

under this section shall comply with requirements imposed 

by the Secretary or a third party with a contract under subsection (d)(3), as applicable, for purposes of administering the 
H. R. 3590—345 

program, including any determination under clause (i) of subsection (c)(1)(A) or procedures established under such subsection (c)(1)(A). 

‘‘(4) LENGTH OF AGREEMENT.— 

‘‘(A) IN GENERAL.—An agreement under this section 

shall be effective for an initial period of not less than 

18 months and shall be automatically renewed for a period 

of not less than 1 year unless terminated under subparagraph (B). 

‘‘(B) TERMINATION.— ‘‘(i) BY THE SECRETARY.—The Secretary may provide for termination of an agreement under this section 

for a knowing and willful violation of the requirements 

of the agreement or other good cause shown. Such 

termination shall not be effective earlier than 30 days 

after the date of notice to the manufacturer of such 

termination. The Secretary shall provide, upon request, 

a manufacturer with a hearing concerning such a 

termination, and such hearing shall take place prior 

to the effective date of the termination with sufficient 

time for such effective date to be repealed if the Secretary determines appropriate. 

‘‘(ii) BY A MANUFACTURER.—A manufacturer may 

terminate an agreement under this section for any 

reason. Any such termination shall be effective, with 

respect to a plan year— 

‘‘(I) if the termination occurs before January 

30 of a plan year, as of the day after the end 

of the plan year; and 

‘‘(II) if the termination occurs on or after 

January 30 of a plan year, as of the day after 

the end of the succeeding plan year. 

‘‘(iii) EFFECTIVENESS OF TERMINATION.—Any termination under this subparagraph shall not affect discounts for applicable drugs of the manufacturer that 

are due under the agreement before the effective date 

of its termination. 

‘‘(iv) NOTICE TO THIRD PARTY.—The Secretary shall 

provide notice of such termination to a third party 

with a contract under subsection (d)(3) within not less 

than 30 days before the effective date of such termination. 

‘‘(c) DUTIES DESCRIBED AND SPECIAL RULE FOR SUPPLEMENTAL

BENEFITS.— 

‘‘(1) DUTIES DESCRIBED.—The duties described in this subsection are the following: 

‘‘(A) ADMINISTRATION OF PROGRAM.—Administering the 

program, including— 

‘‘(i) the determination of the amount of the discounted price of an applicable drug of a manufacturer; 

‘‘(ii) except as provided in clause (iii), the establishment of procedures under which discounted prices are 

provided to applicable beneficiaries at pharmacies or 

by mail order service at the point-of-sale of an 

applicable drug; 

‘‘(iii) in the case where, during the period beginning 

on July 1, 2010, and ending on December 31, 2011, 
H. R. 3590—346 

it is not practicable to provide such discounted prices 

at the point-of-sale (as described in clause (ii)), the 

establishment of procedures to provide such discounted 

prices as soon as practicable after the point-of-sale; 

‘‘(iv) the establishment of procedures to ensure 

that, not later than the applicable number of calendar 

days after the dispensing of an applicable drug by 

a pharmacy or mail order service, the pharmacy or 

mail order service is reimbursed for an amount equal 

to the difference between— 

‘‘(I) the negotiated price of the applicable drug; 

and 

‘‘(II) the discounted price of the applicable 

drug; 

‘‘(v) the establishment of procedures to ensure that 

the discounted price for an applicable drug under this 

section is applied before any coverage or financial 

assistance under other health benefit plans or programs that provide coverage or financial assistance 

for the purchase or provision of prescription drug coverage on behalf of applicable beneficiaries as the Secretary may specify; 

‘‘(vi) the establishment of procedures to implement 

the special rule for supplemental benefits under paragraph (2); and 

‘‘(vii) providing a reasonable dispute resolution 

mechanism to resolve disagreements between manufacturers, applicable beneficiaries, and the third party 

with a contract under subsection (d)(3). 

‘‘(B) MONITORING COMPLIANCE.— ‘‘(i) IN GENERAL.—The Secretary shall monitor 

compliance by a manufacturer with the terms of an 

agreement under this section. 

‘‘(ii) NOTIFICATION.—If a third party with a contract under subsection (d)(3) determines that the 

manufacturer is not in compliance with such agreement, the third party shall notify the Secretary of 

such noncompliance for appropriate enforcement under 

subsection (e). 

‘‘(C) COLLECTION OF DATA FROM PRESCRIPTION DRUG

PLANS AND MA–PD PLANS.—The Secretary may collect appropriate data from prescription drug plans and MA–PD plans 

in a timeframe that allows for discounted prices to be 

provided for applicable drugs under this section. 

‘‘(2) SPECIAL RULE FOR SUPPLEMENTAL BENEFITS.—For plan 

year 2010 and each subsequent plan year, in the case where 

an applicable beneficiary has supplemental benefits with 

respect to applicable drugs under the prescription drug plan 

or MA–PD plan that the applicable beneficiary is enrolled in, 

the applicable beneficiary shall not be provided a discounted 

price for an applicable drug under this section until after such 

supplemental benefits have been applied with respect to the 

applicable drug. 

‘‘(d) ADMINISTRATION.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary 

shall provide for the implementation of this section, including 

the performance of the duties described in subsection (c)(1). 
H. R. 3590—347 

‘‘(2) LIMITATION.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), in providing for such implementation, the Secretary shall not 

receive or distribute any funds of a manufacturer under 

the program. 

‘‘(B) EXCEPTION.—The limitation under subparagraph 

(A) shall not apply to the Secretary with respect to drugs 

dispensed during the period beginning on July 1, 2010, 

and ending on December 31, 2010, but only if the Secretary 

determines that the exception to such limitation under 

this subparagraph is necessary in order for the Secretary 

to begin implementation of this section and provide 

applicable beneficiaries timely access to discounted prices 

during such period. 

‘‘(3) CONTRACT WITH THIRD PARTIES.—The Secretary shall 

enter into a contract with 1 or more third parties to administer 

the requirements established by the Secretary in order to carry 

out this section. At a minimum, the contract with a third 

party under the preceding sentence shall require that the third 

party— 

‘‘(A) receive and transmit information between the Secretary, manufacturers, and other individuals or entities 

the Secretary determines appropriate; 

‘‘(B) receive, distribute, or facilitate the distribution 

of funds of manufacturers to appropriate individuals or 

entities in order to meet the obligations of manufacturers 

under agreements under this section; 

‘‘(C) provide adequate and timely information to manufacturers, consistent with the agreement with the manufacturer under this section, as necessary for the manufacturer 

to fulfill its obligations under this section; and 

‘‘(D) permit manufacturers to conduct periodic audits, 

directly or through contracts, of the data and information 

used by the third party to determine discounts for 

applicable drugs of the manufacturer under the program. 

‘‘(4) PERFORMANCE REQUIREMENTS.—The Secretary shall 

establish performance requirements for a third party with a 

contract under paragraph (3) and safeguards to protect the 

independence and integrity of the activities carried out by the 

third party under the program under this section. 

‘‘(5) IMPLEMENTATION.—The Secretary may implement the 

program under this section by program instruction or otherwise. 

‘‘(6) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to the program under this section. 

‘‘(e) ENFORCEMENT.— 

‘‘(1) AUDITS.—Each manufacturer with an agreement in 

effect under this section shall be subject to periodic audit by 

the Secretary. 

‘‘(2) CIVIL MONEY PENALTY.— 

‘‘(A) IN GENERAL.—The Secretary shall impose a civil 

money penalty on a manufacturer that fails to provide 

applicable beneficiaries discounts for applicable drugs of 

the manufacturer in accordance with such agreement for 

each such failure in an amount the Secretary determines 

is commensurate with the sum of— 
H. R. 3590—348 

‘‘(i) the amount that the manufacturer would have 

paid with respect to such discounts under the agreement, which will then be used to pay the discounts 

which the manufacturer had failed to provide; and 

‘‘(ii) 25 percent of such amount. 

‘‘(B) APPLICATION.—The provisions of section 1128A 

(other than subsections (a) and (b)) shall apply to a civil 

money penalty under this paragraph in the same manner 

as such provisions apply to a penalty or proceeding under 

section 1128A(a). 

‘‘(f) CLARIFICATION REGARDING AVAILABILITY OF OTHER COVERED PART D DRUGS.—Nothing in this section shall prevent an 

applicable beneficiary from purchasing a covered part D drug that 

is not an applicable drug (including a generic drug or a drug 

that is not on the formulary of the prescription drug plan or MA– 

PD plan that the applicable beneficiary is enrolled in). 

‘‘(g) DEFINITIONS.—In this section: 

‘‘(1) APPLICABLE BENEFICIARY.—The term ‘applicable beneficiary’ means an individual who, on the date of dispensing 

an applicable drug— 

‘‘(A) is enrolled in a prescription drug plan or an MA– 

PD plan; 

‘‘(B) is not enrolled in a qualified retiree prescription 

drug plan; 

‘‘(C) is not entitled to an income-related subsidy under 

section 1860D–14(a); 

‘‘(D) is not subject to a reduction in premium subsidy 

under section 1839(i); and 

‘‘(E) who— 

‘‘(i) has reached or exceeded the initial coverage 

limit under section 1860D–2(b)(3) during the year; and 

‘‘(ii) has not incurred costs for covered part D 

drugs in the year equal to the annual out-of-pocket 

threshold specified in section 1860D–2(b)(4)(B). 

‘‘(2) APPLICABLE DRUG.—The term ‘applicable drug’ means, 

with respect to an applicable beneficiary, a covered part D 

drug— 

‘‘(A) approved under a new drug application under 

section 505(b) of the Federal Food, Drug, and Cosmetic 

Act or, in the case of a biologic product, licensed under 

section 351 of the Public Health Service Act (other than 

a product licensed under subsection (k) of such section 

351); and 

‘‘(B)(i) if the PDP sponsor of the prescription drug 

plan or the MA organization offering the MA–PD plan 

uses a formulary, which is on the formulary of the prescription drug plan or MA–PD plan that the applicable beneficiary is enrolled in; 

‘‘(ii) if the PDP sponsor of the prescription drug plan 

or the MA organization offering the MA–PD plan does 

not use a formulary, for which benefits are available under 

the prescription drug plan or MA–PD plan that the 

applicable beneficiary is enrolled in; or 

‘‘(iii) is provided through an exception or appeal. 

‘‘(3) APPLICABLE NUMBER OF CALENDAR DAYS.—The term 

‘applicable number of calendar days’ means— 
H. R. 3590—349 

‘‘(A) with respect to claims for reimbursement submitted electronically, 14 days; and 

‘‘(B) with respect to claims for reimbursement submitted otherwise, 30 days. 

‘‘(4) DISCOUNTED PRICE.— 

‘‘(A) IN GENERAL.—The term ‘discounted price’ means 

50 percent of the negotiated price of the applicable drug 

of a manufacturer. 

‘‘(B) CLARIFICATION.—Nothing in this section shall be 

construed as affecting the responsibility of an applicable 

beneficiary for payment of a dispensing fee for an applicable 

drug. 

‘‘(C) SPECIAL CASE FOR CERTAIN CLAIMS.—In the case 

where the entire amount of the negotiated price of an 

individual claim for an applicable drug with respect to 

an applicable beneficiary does not fall at or above the 

initial coverage limit under section 1860D–2(b)(3) and 

below the annual out-of-pocket threshold specified in section 1860D–2(b)(4)(B) for the year, the manufacturer of 

the applicable drug shall provide the discounted price under 

this section on only the portion of the negotiated price 

of the applicable drug that falls at or above such initial 

coverage limit and below such annual out-of-pocket 

threshold. 

‘‘(5) MANUFACTURER.—The term ‘manufacturer’ means any 

entity which is engaged in the production, preparation, propagation, compounding, conversion, or processing of prescription 

drug products, either directly or indirectly by extraction from 

substances of natural origin, or independently by means of 

chemical synthesis, or by a combination of extraction and chemical synthesis. Such term does not include a wholesale distributor of drugs or a retail pharmacy licensed under State 

law. 

‘‘(6) NEGOTIATED PRICE.—The term ‘negotiated price’ has 

the meaning given such term in section 423.100 of title 42, 

Code of Federal Regulations (as in effect on the date of enactment of this section), except that such negotiated price shall 

not include any dispensing fee for the applicable drug. 

‘‘(7) QUALIFIED RETIREE PRESCRIPTION DRUG PLAN.—The 

term ‘qualified retiree prescription drug plan’ has the meaning 

given such term in section 1860D–22(a)(2).’’. 

(c) INCLUSION IN INCURRED COSTS.— 

(1) IN GENERAL.—Section 1860D–2(b)(4) of the Social Security Act (42 U.S.C. 1395w–102(b)(4)) is amended— 

(A) in subparagraph (C), in the matter preceding clause 

(i), by striking ‘‘In applying’’ and inserting ‘‘Except as provided in subparagraph (E), in applying’’; and 

(B) by adding at the end the following new subparagraph: 

‘‘(E) INCLUSION OF COSTS OF APPLICABLE DRUGS UNDER

MEDICARE COVERAGE GAP DISCOUNT PROGRAM.—In applying 

subparagraph (A), incurred costs shall include the negotiated price (as defined in paragraph (6) of section 1860D– 

14A(g)) of an applicable drug (as defined in paragraph 

(2) of such section) of a manufacturer that is furnished 

to an applicable beneficiary (as defined in paragraph (1) 

of such section) under the Medicare coverage gap discount 
H. R. 3590—350 

program under section 1860D–14A, regardless of whether 

part of such costs were paid by a manufacturer under 

such program.’’. 

(2) EFFECTIVE DATE.—The amendments made by this subsection shall apply to costs incurred on or after July 1, 2010. 

(d) CONFORMING AMENDMENT PERMITTING PRESCRIPTION DRUG

DISCOUNTS.— 

(1) IN GENERAL.—Section 1128B(b)(3) of the Social Security 

Act (42 U.S.C. 1320a–7b(b)(3)) is amended— 

(A) by striking ‘‘and’’ at the end of subparagraph (G); 

(B) in the subparagraph (H) added by section 237(d) 

of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 

2213)— 

(i) by moving such subparagraph 2 ems to the 

left; and 

(ii) by striking the period at the end and inserting 

a semicolon; 

(C) in the subparagraph (H) added by section 431(a) 

of such Act (117 Stat. 2287)— 

(i) by redesignating such subparagraph as subparagraph (I); 

(ii) by moving such subparagraph 2 ems to the 

left; and 

(iii) by striking the period at the end and inserting 

‘‘; and’’; and 

(D) by adding at the end the following new subparagraph: 

‘‘(J) a discount in the price of an applicable drug (as 

defined in paragraph (2) of section 1860D–14A(g)) of a 

manufacturer that is furnished to an applicable beneficiary 

(as defined in paragraph (1) of such section) under the 

Medicare coverage gap discount program under section 

1860D–14A.’’. 

(2) CONFORMING AMENDMENT TO DEFINITION OF BEST PRICE

UNDER MEDICAID.—Section 1927(c)(1)(C)(i)(VI) of the Social 

Security Act (42 U.S.C. 1396r–8(c)(1)(C)(i)(VI)) is amended by 

inserting ‘‘, or any discounts provided by manufacturers under 

the Medicare coverage gap discount program under section 

1860D–14A’’ before the period at the end. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to drugs dispensed on or after July 1, 

2010. 

SEC. 3302. IMPROVEMENT IN DETERMINATION OF MEDICARE PART 

D LOW-INCOME BENCHMARK PREMIUM. 

(a) IN GENERAL.—Section 1860D–14(b)(2)(B)(iii) of the Social 

Security Act (42 U.S.C. 1395w–114(b)(2)(B)(iii)) is amended by 

inserting ‘‘, determined without regard to any reduction in such 

premium as a result of any beneficiary rebate under section 

1854(b)(1)(C) or bonus payment under section 1853(n)’’ before the 

period at the end. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply to premiums for months beginning on or after January 

1, 2011. 
H. R. 3590—351 

SEC. 3303. VOLUNTARY DE MINIMIS POLICY FOR SUBSIDY ELIGIBLE 

INDIVIDUALS UNDER PRESCRIPTION DRUG PLANS AND 

MA–PD PLANS. 

(a) IN GENERAL.—Section 1860D–14(a) of the Social Security 

Act (42 U.S.C. 1395w–114(a)) is amended by adding at the end 

the following new paragraph: 

‘‘(5) WAIVER OF DE MINIMIS PREMIUMS.—The Secretary 

shall, under procedures established by the Secretary, permit 

a prescription drug plan or an MA–PD plan to waive the 

monthly beneficiary premium for a subsidy eligible individual 

if the amount of such premium is de minimis. If such premium 

is waived under the plan, the Secretary shall not reassign 

subsidy eligible individuals enrolled in the plan to other plans 

based on the fact that the monthly beneficiary premium under 

the plan was greater than the low-income benchmark premium 

amount.’’. 

(b) AUTHORIZING THE SECRETARY TO AUTO-ENROLL SUBSIDY

ELIGIBLE INDIVIDUALS IN PLANS THAT WAIVE DE MINIMIS PREMIUMS.—Section 1860D–1(b)(1) of the Social Security Act (42 U.S.C. 

1395w–101(b)(1)) is amended— 

(1) in subparagraph (C), by inserting ‘‘except as provided 

in subparagraph (D),’’ after ‘‘shall include,’’ 

(2) by adding at the end the following new subparagraph: 

‘‘(D) SPECIAL RULE FOR PLANS THAT WAIVE DE MINIMIS

PREMIUMS.—The process established under subparagraph 

(A) may include, in the case of a part D eligible individual 

who is a subsidy eligible individual (as defined in section 

1860D–14(a)(3)) who has failed to enroll in a prescription 

drug plan or an MA–PD plan, for the enrollment in a 

prescription drug plan or MA–PD plan that has waived 

the monthly beneficiary premium for such subsidy eligible 

individual under section 1860D–14(a)(5). If there is more 

than one such plan available, the Secretary shall enroll 

such an individual under the preceding sentence on a 

random basis among all such plans in the PDP region. 

Nothing in the previous sentence shall prevent such an 

individual from declining or changing such enrollment.’’. 

(c) EFFECTIVE DATE.—The amendments made by this subsection 

shall apply to premiums for months, and enrollments for plan 

years, beginning on or after January 1, 2011. 

SEC. 3304. SPECIAL RULE FOR WIDOWS AND WIDOWERS REGARDING 

ELIGIBILITY FOR LOW-INCOME ASSISTANCE. 

(a) IN GENERAL.—Section 1860D–14(a)(3)(B) of the Social Security Act (42 U.S.C. 1395w–114(a)(3)(B)) is amended by adding at 

the end the following new clause: 

‘‘(vi) SPECIAL RULE FOR WIDOWS AND WIDOWERS.— 

Notwithstanding the preceding provisions of this 

subparagraph, in the case of an individual whose 

spouse dies during the effective period for a determination or redetermination that has been made under 

this subparagraph, such effective period shall be 

extended through the date that is 1 year after the 

date on which the determination or redetermination 

would (but for the application of this clause) otherwise 

cease to be effective.’’. 
H. R. 3590—352 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall take effect on January 1, 2011. 

SEC. 3305. IMPROVED INFORMATION FOR SUBSIDY ELIGIBLE INDIVIDUALS REASSIGNED TO PRESCRIPTION DRUG PLANS AND 

MA–PD PLANS. 

Section 1860D–14 of the Social Security Act (42 U.S.C. 1395w– 

114) is amended— 

(1) by redesignating subsection (d) as subsection (e); and 

(2) by inserting after subsection (c) the following new subsection: 

‘‘(d) FACILITATION OF REASSIGNMENTS.—Beginning not later 

than January 1, 2011, the Secretary shall, in the case of a subsidy 

eligible individual who is enrolled in one prescription drug plan 

and is subsequently reassigned by the Secretary to a new prescription drug plan, provide the individual, within 30 days of such 

reassignment, with— 

‘‘(1) information on formulary differences between the 

individual’s former plan and the plan to which the individual 

is reassigned with respect to the individual’s drug regimens; 

and 

‘‘(2) a description of the individual’s right to request a 

coverage determination, exception, or reconsideration under section 1860D–4(g), bring an appeal under section 1860D–4(h), 

or resolve a grievance under section 1860D–4(f).’’. 

SEC. 3306. FUNDING OUTREACH AND ASSISTANCE FOR LOW-INCOME 

PROGRAMS. 

(a) ADDITIONAL FUNDING FOR STATE HEALTH INSURANCE PRO- GRAMS.—Subsection (a)(1)(B) of section 119 of the Medicare 

Improvements for Patients and Providers Act of 2008 (42 U.S.C. 

1395b–3 note) is amended by striking ‘‘(42 U.S.C. 1395w–23(f))’’ 

and all that follows through the period at the end and inserting 

‘‘(42 U.S.C. 1395w–23(f)), to the Centers for Medicare & Medicaid 

Services Program Management Account— ‘‘(i) for fiscal year 2009, of $7,500,000; and 

‘‘(ii) for the period of fiscal years 2010 through 2012, of $15,000,000. 

Amounts appropriated under this subparagraph shall 

remain available until expended.’’. 

(b) ADDITIONAL FUNDING FOR AREA AGENCIES ON AGING.— Subsection (b)(1)(B) of such section 119 is amended by striking 

‘‘(42 U.S.C. 1395w–23(f))’’ and all that follows through the period 

at the end and inserting ‘‘(42 U.S.C. 1395w–23(f)), to the Administration on Aging— ‘‘(i) for fiscal year 2009, of $7,500,000; and 

‘‘(ii) for the period of fiscal years 2010 through 2012, of $15,000,000. 

Amounts appropriated under this subparagraph shall 

remain available until expended.’’. 

(c) ADDITIONAL FUNDING FOR AGING AND DISABILITY RESOURCE

CENTERS.—Subsection (c)(1)(B) of such section 119 is amended by 

striking ‘‘(42 U.S.C. 1395w–23(f))’’ and all that follows through 

the period at the end and inserting ‘‘(42 U.S.C. 1395w–23(f)), to 

the Administration on Aging— ‘‘(i) for fiscal year 2009, of $5,000,000; and 

‘‘(ii) for the period of fiscal years 2010 through 2012, of $10,000,000. 
H. R. 3590—353 

Amounts appropriated under this subparagraph shall 

remain available until expended.’’. 

(d) ADDITIONAL FUNDING FOR CONTRACT WITH THE NATIONAL

CENTER FOR BENEFITS AND OUTREACH ENROLLMENT.—Subsection 

(d)(2) of such section 119 is amended by striking ‘‘(42 U.S.C. 1395w– 

23(f))’’ and all that follows through the period at the end and 

inserting ‘‘(42 U.S.C. 1395w–23(f)), to the Administration on 

Aging— 

‘‘(i) for fiscal year 2009, of $5,000,000; and 

‘‘(ii) for the period of fiscal years 2010 through 

2012, of $5,000,000. 

Amounts appropriated under this subparagraph shall 

remain available until expended.’’. 

(e) SECRETARIAL AUTHORITY TO ENLIST SUPPORT IN CONDUCTING CERTAIN OUTREACH ACTIVITIES.—Such section 119 is 

amended by adding at the end the following new subsection: 

‘‘(g) SECRETARIAL AUTHORITY TO ENLIST SUPPORT IN CONDUCTING CERTAIN OUTREACH ACTIVITIES.—The Secretary may 

request that an entity awarded a grant under this section support 

the conduct of outreach activities aimed at preventing disease and 

promoting wellness. Notwithstanding any other provision of this 

section, an entity may use a grant awarded under this subsection 

to support the conduct of activities described in the preceding 

sentence.’’. 

SEC. 3307. IMPROVING FORMULARY REQUIREMENTS FOR PRESCRIPTION DRUG PLANS AND MA–PD PLANS WITH RESPECT 

TO CERTAIN CATEGORIES OR CLASSES OF DRUGS. 

(a) IMPROVING FORMULARY REQUIREMENTS.—Section 1860D– 

4(b)(3)(G) of the Social Security Act is amended to read as follows: 

‘‘(G) REQUIRED INCLUSION OF DRUGS IN CERTAIN CATEGORIES AND CLASSES.— 

‘‘(i) FORMULARY REQUIREMENTS.— 

‘‘(I) IN GENERAL.—Subject to subclause (II), 

a PDP sponsor offering a prescription drug plan 

shall be required to include all covered part D 

drugs in the categories and classes identified by 

the Secretary under clause (ii)(I). 

‘‘(II) EXCEPTIONS.—The Secretary may establish exceptions that permit a PDP sponsor offering 

a prescription drug plan to exclude from its formulary a particular covered part D drug in a category or class that is otherwise required to be 

included in the formulary under subclause (I) (or 

to otherwise limit access to such a drug, including 

through prior authorization or utilization management). 

‘‘(ii) IDENTIFICATION OF DRUGS IN CERTAIN CATEGORIES AND CLASSES.— 

‘‘(I) IN GENERAL.—Subject to clause (iv), the 

Secretary shall identify, as appropriate, categories 

and classes of drugs for which the Secretary determines are of clinical concern. 

‘‘(II) CRITERIA.—The Secretary shall use criteria established by the Secretary in making any 

determination under subclause (I). 
H. R. 3590—354 

‘‘(iii) IMPLEMENTATION.—The Secretary shall establish the criteria under clause (ii)(II) and any exceptions 

under clause (i)(II) through the promulgation of a regulation which includes a public notice and comment 

period. 

‘‘(iv) REQUIREMENT FOR CERTAIN CATEGORIES AND

CLASSES UNTIL CRITERIA ESTABLISHED.—Until such 

time as the Secretary establishes the criteria under 

clause (ii)(II) the following categories and classes of 

drugs shall be identified under clause (ii)(I): 

‘‘(I) Anticonvulsants. 

‘‘(II) Antidepressants. 

‘‘(III) Antineoplastics. 

‘‘(IV) Antipsychotics. 

‘‘(V) Antiretrovirals. 

‘‘(VI) Immunosuppressants for the treatment 

of transplant rejection.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to plan year 2011 and subsequent plan years. 

SEC. 3308. REDUCING PART D PREMIUM SUBSIDY FOR HIGH-INCOME 

BENEFICIARIES. 

(a) INCOME-RELATED INCREASE IN PART D PREMIUM.— 

(1) IN GENERAL.—Section 1860D–13(a) of the Social Security Act (42 U.S.C. 1395w–113(a)) is amended by adding at 

the end the following new paragraph: 

‘‘(7) INCREASE IN BASE BENEFICIARY PREMIUM BASED ON

INCOME.— 

‘‘(A) IN GENERAL.—In the case of an individual whose 

modified adjusted gross income exceeds the threshold 

amount applicable under paragraph (2) of section 1839(i) 

(including application of paragraph (5) of such section) 

for the calendar year, the monthly amount of the beneficiary premium applicable under this section for a month 

after December 2010 shall be increased by the monthly 

adjustment amount specified in subparagraph (B). 

‘‘(B) MONTHLY ADJUSTMENT AMOUNT.—The monthly 

adjustment amount specified in this subparagraph for an 

individual for a month in a year is equal to the product 

of— 

‘‘(i) the quotient obtained by dividing— 

‘‘(I) the applicable percentage determined 

under paragraph (3)(C) of section 1839(i) (including 

application of paragraph (5) of such section) for 

the individual for the calendar year reduced by 

25.5 percent; by 

‘‘(II) 25.5 percent; and 

‘‘(ii) the base beneficiary premium (as computed 

under paragraph (2)). 

‘‘(C) MODIFIED ADJUSTED GROSS INCOME.—For purposes 

of this paragraph, the term ‘modified adjusted gross income’ 

has the meaning given such term in subparagraph (A) 

of section 1839(i)(4), determined for the taxable year 

applicable under subparagraphs (B) and (C) of such section. 

‘‘(D) DETERMINATION BY COMMISSIONER OF SOCIAL

SECURITY.—The Commissioner of Social Security shall 

make any determination necessary to carry out the income- 
H. R. 3590—355 

related increase in the base beneficiary premium under 

this paragraph. 

‘‘(E) PROCEDURES TO ASSURE CORRECT INCOME-RELATED

INCREASE IN BASE BENEFICIARY PREMIUM.— 

‘‘(i) DISCLOSURE OF BASE BENEFICIARY PREMIUM.— 

Not later than September 15 of each year beginning 

with 2010, the Secretary shall disclose to the Commissioner of Social Security the amount of the base beneficiary premium (as computed under paragraph (2)) 

for the purpose of carrying out the income-related 

increase in the base beneficiary premium under this 

paragraph with respect to the following year. 

‘‘(ii) ADDITIONAL DISCLOSURE.—Not later than 

October 15 of each year beginning with 2010, the Secretary shall disclose to the Commissioner of Social 

Security the following information for the purpose of 

carrying out the income-related increase in the base 

beneficiary premium under this paragraph with respect 

to the following year: 

‘‘(I) The modified adjusted gross income 

threshold applicable under paragraph (2) of section 

1839(i) (including application of paragraph (5) of 

such section). 

‘‘(II) The applicable percentage determined 

under paragraph (3)(C) of section 1839(i) (including 

application of paragraph (5) of such section). 

‘‘(III) The monthly adjustment amount specified in subparagraph (B). 

‘‘(IV) Any other information the Commissioner 

of Social Security determines necessary to carry 

out the income-related increase in the base beneficiary premium under this paragraph. 

‘‘(F) RULE OF CONSTRUCTION.—The formula used to 

determine the monthly adjustment amount specified under 

subparagraph (B) shall only be used for the purpose of 

determining such monthly adjustment amount under such 

subparagraph.’’. 

(2) COLLECTION OF MONTHLY ADJUSTMENT AMOUNT.—Section 1860D–13(c) of the Social Security Act (42 U.S.C. 1395w– 

113(c)) is amended— 

(A) in paragraph (1), by striking ‘‘(2) and (3)’’ and 

inserting ‘‘(2), (3), and (4)’’; and 

(B) by adding at the end the following new paragraph: 

‘‘(4) COLLECTION OF MONTHLY ADJUSTMENT AMOUNT.— 

‘‘(A) IN GENERAL.—Notwithstanding any provision of 

this subsection or section 1854(d)(2), subject to subparagraph (B), the amount of the income-related increase in 

the base beneficiary premium for an individual for a month 

(as determined under subsection (a)(7)) shall be paid 

through withholding from benefit payments in the manner 

provided under section 1840. 

‘‘(B) AGREEMENTS.—In the case where the monthly benefit payments of an individual that are withheld under 

subparagraph (A) are insufficient to pay the amount 

described in such subparagraph, the Commissioner of 

Social Security shall enter into agreements with the Secretary, the Director of the Office of Personnel Management, 
H. R. 3590—356 

and the Railroad Retirement Board as necessary in order 

to allow other agencies to collect the amount described 

in subparagraph (A) that was not withheld under such 

subparagraph.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) MEDICARE.—Section 1860D–13(a)(1) of the Social Security Act (42 U.S.C. 1395w–113(a)(1)) is amended— 

(A) by redesignating subparagraph (F) as subparagraph 

(G); 

(B) in subparagraph (G), as redesignated by subparagraph (A), by striking ‘‘(D) and (E)’’ and inserting ‘‘(D), 

(E), and (F)’’; and 

(C) by inserting after subparagraph (E) the following 

new subparagraph: 

‘‘(F) INCREASE BASED ON INCOME.—The monthly beneficiary premium shall be increased pursuant to paragraph 

(7).’’. 

(2) INTERNAL REVENUE CODE.—Section 6103(l)(20) of the 

Internal Revenue Code of 1986 (relating to disclosure of return 

information to carry out Medicare part B premium subsidy 

adjustment) is amended— 

(A) in the heading, by inserting ‘‘AND PART D BASE

BENEFICIARY PREMIUM INCREASE’’ after ‘‘PART B PREMIUM

SUBSIDY ADJUSTMENT’’; 

(B) in subparagraph (A)— 

(i) in the matter preceding clause (i), by inserting 

‘‘or increase under section 1860D–13(a)(7)’’ after 

‘‘1839(i)’’; and 

(ii) in clause (vii), by inserting after ‘‘subsection 

(i) of such section’’ the following: ‘‘or increase under 

section 1860D–13(a)(7) of such Act’’; and 

(C) in subparagraph (B)— 

(i) by striking ‘‘Return information’’ and inserting 

the following: 

‘‘(i) IN GENERAL.—Return information’’; 

(ii) by inserting ‘‘or increase under such section 

1860D–13(a)(7)’’ before the period at the end; 

(iii) as amended by clause (i), by inserting ‘‘or 

for the purpose of resolving taxpayer appeals with 

respect to any such premium adjustment or increase’’ 

before the period at the end; and 

(iv) by adding at the end the following new clause: 

‘‘(ii) DISCLOSURE TO OTHER AGENCIES.—Officers, 

employees, and contractors of the Social Security 

Administration may disclose— 

‘‘(I) the taxpayer identity information and the 

amount of the premium subsidy adjustment or 

premium increase with respect to a taxpayer 

described in subparagraph (A) to officers, 

employees, and contractors of the Centers for Medicare and Medicaid Services, to the extent that 

such disclosure is necessary for the collection of 

the premium subsidy amount or the increased premium amount, 

‘‘(II) the taxpayer identity information and the 

amount of the premium subsidy adjustment or 

the increased premium amount with respect to 
H. R. 3590—357 

a taxpayer described in subparagraph (A) to officers and employees of the Office of Personnel 

Management and the Railroad Retirement Board, 

to the extent that such disclosure is necessary 

for the collection of the premium subsidy amount 

or the increased premium amount, 

‘‘(III) return information with respect to a taxpayer described in subparagraph (A) to officers 

and employees of the Department of Health and 

Human Services to the extent necessary to resolve 

administrative appeals of such premium subsidy 

adjustment or increased premium, and 

‘‘(IV) return information with respect to a taxpayer described in subparagraph (A) to officers 

and employees of the Department of Justice for 

use in judicial proceedings to the extent necessary 

to carry out the purposes described in clause (i).’’. 

SEC. 3309. ELIMINATION OF COST SHARING FOR CERTAIN DUAL 

ELIGIBLE INDIVIDUALS. 

Section 1860D–14(a)(1)(D)(i) of the Social Security Act (42 

U.S.C. 1395w–114(a)(1)(D)(i)) is amended by inserting ‘‘or, effective 

on a date specified by the Secretary (but in no case earlier than 

January 1, 2012), who would be such an institutionalized individual 

or couple, if the full-benefit dual eligible individual were not 

receiving services under a home and community-based waiver 

authorized for a State under section 1115 or subsection (c) or 

(d) of section 1915 or under a State plan amendment under subsection (i) of such section or services provided through enrollment 

in a medicaid managed care organization with a contract under 

section 1903(m) or under section 1932’’ after ‘‘1902(q)(1)(B))’’. 

SEC. 3310. REDUCING WASTEFUL DISPENSING OF OUTPATIENT 

PRESCRIPTION DRUGS IN LONG-TERM CARE FACILITIES 

UNDER PRESCRIPTION DRUG PLANS AND MA–PD PLANS. 

(a) IN GENERAL.—Section 1860D–4(c) of the Social Security 

Act (42 U.S.C. 1395w–104(c)) is amended by adding at the end 

the following new paragraph: 

‘‘(3) REDUCING WASTEFUL DISPENSING OF OUTPATIENT

PRESCRIPTION DRUGS IN LONG-TERM CARE FACILITIES.—The Secretary shall require PDP sponsors of prescription drug plans 

to utilize specific, uniform dispensing techniques, as determined 

by the Secretary, in consultation with relevant stakeholders 

(including representatives of nursing facilities, residents of 

nursing facilities, pharmacists, the pharmacy industry 

(including retail and long-term care pharmacy), prescription 

drug plans, MA–PD plans, and any other stakeholders the 

Secretary determines appropriate), such as weekly, daily, or 

automated dose dispensing, when dispensing covered part D 

drugs to enrollees who reside in a long-term care facility in 

order to reduce waste associated with 30-day fills.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply to plan years beginning on or after January 1, 2012. 

SEC. 3311. IMPROVED MEDICARE PRESCRIPTION DRUG PLAN AND MA– 

PD PLAN COMPLAINT SYSTEM. 

(a) IN GENERAL.—The Secretary shall develop and maintain 

a complaint system, that is widely known and easy to use, to 
H. R. 3590—358 

collect and maintain information on MA–PD plan and prescription 

drug plan complaints that are received (including by telephone, 

letter, e-mail, or any other means) by the Secretary (including 

by a regional office of the Department of Health and Human Services, the Medicare Beneficiary Ombudsman, a subcontractor, a carrier, a fiscal intermediary, and a Medicare administrative contractor 

under section 1874A of the Social Security Act (42 U.S.C. 1395kk)) 

through the date on which the complaint is resolved. The system 

shall be able to report and initiate appropriate interventions and 

monitoring based on substantial complaints and to guide quality 

improvement. 

(b) MODEL ELECTRONIC COMPLAINT FORM.—The Secretary shall 

develop a model electronic complaint form to be used for reporting 

plan complaints under the system. Such form shall be prominently 

displayed on the front page of the Medicare.gov Internet website 

and on the Internet website of the Medicare Beneficiary Ombudsman. 

(c) ANNUAL REPORTS BY THE SECRETARY.—The Secretary shall 

submit to Congress annual reports on the system. Such reports 

shall include an analysis of the number and types of complaints 

reported in the system, geographic variations in such complaints, 

the timeliness of agency or plan responses to such complaints, 

and the resolution of such complaints. 

(d) DEFINITIONS.—In this section: 

(1) MA–PD PLAN.—The term ‘‘MA–PD plan’’ has the 

meaning given such term in section 1860D–41(a)(9) of such 

Act (42 U.S.C. 1395w–151(a)(9)). 

(2) PRESCRIPTION DRUG PLAN.—The term ‘‘prescription drug 

plan’’ has the meaning given such term in section 1860D– 

41(a)(14) of such Act (42 U.S.C. 1395w–151(a)(14)). 

(3) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

(4) SYSTEM.—The term ‘‘system’’ means the plan complaint 

system developed and maintained under subsection (a). 

SEC. 3312. UNIFORM EXCEPTIONS AND APPEALS PROCESS FOR 

PRESCRIPTION DRUG PLANS AND MA–PD PLANS. 

(a) IN GENERAL.—Section 1860D–4(b)(3) of the Social Security 

Act (42 U.S.C. 1395w–104(b)(3)) is amended by adding at the end 

the following new subparagraph: 

‘‘(H) USE OF SINGLE, UNIFORM EXCEPTIONS AND APPEALS

PROCESS.—Notwithstanding any other provision of this 

part, each PDP sponsor of a prescription drug plan shall— 

‘‘(i) use a single, uniform exceptions and appeals 

process (including, to the extent the Secretary determines feasible, a single, uniform model form for use 

under such process) with respect to the determination 

of prescription drug coverage for an enrollee under 

the plan; and 

‘‘(ii) provide instant access to such process by 

enrollees through a toll-free telephone number and 

an Internet website.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall apply to exceptions and appeals on or after January 1, 2012. 
H. R. 3590—359 

SEC. 3313. OFFICE OF THE INSPECTOR GENERAL STUDIES AND 

REPORTS. 

(a) STUDY AND ANNUAL REPORT ON PART D FORMULARIES’ 

INCLUSION OF DRUGS COMMONLY USED BY DUAL ELIGIBLES.— 

(1) STUDY.—The Inspector General of the Department of 

Health and Human Services shall conduct a study of the extent 

to which formularies used by prescription drug plans and MA– 

PD plans under part D include drugs commonly used by fullbenefit dual eligible individuals (as defined in section 1935(c)(6) 

of the Social Security Act (42 U.S.C. 1396u–5(c)(6))). 

(2) ANNUAL REPORTS.—Not later than July 1 of each year 

(beginning with 2011), the Inspector General shall submit to 

Congress a report on the study conducted under paragraph 

(1), together with such recommendations as the Inspector General determines appropriate. 

(b) STUDY AND REPORT ON PRESCRIPTION DRUG PRICES UNDER

MEDICARE PART D AND MEDICAID.— 

(1) STUDY.— 

(A) IN GENERAL.—The Inspector General of the Department of Health and Human Services shall conduct a study 

on prices for covered part D drugs under the Medicare 

prescription drug program under part D of title XVIII 

of the Social Security Act and for covered outpatient drugs 

under title XIX. Such study shall include the following: 

(i) A comparison, with respect to the 200 most 

frequently dispensed covered part D drugs under such 

program and covered outpatient drugs under such title 

(as determined by the Inspector General based on 

volume and expenditures), of— 

(I) the prices paid for covered part D drugs 

by PDP sponsors of prescription drug plans and 

Medicare Advantage organizations offering MA– 

PD plans; and 

(II) the prices paid for covered outpatient 

drugs by a State plan under title XIX. 

(ii) An assessment of— 

(I) the financial impact of any discrepancies 

in such prices on the Federal Government; and 

(II) the financial impact of any such discrepancies on enrollees under part D or individuals 

eligible for medical assistance under a State plan 

under title XIX. 

(B) PRICE.—For purposes of subparagraph (A), the 

price of a covered part D drug or a covered outpatient 

drug shall include any rebate or discount under such program or such title, respectively, including any negotiated 

price concession described in section 1860D–2(d)(1)(B) of 

the Social Security Act (42 U.S.C. 1395w–102(d)(1)(B)) or 

rebate under an agreement under section 1927 of the Social 

Security Act (42 U.S.C. 1396r–8). 

(C) AUTHORITY TO COLLECT ANY NECESSARY INFORMATION.—Notwithstanding any other provision of law, the 

Inspector General of the Department of Health and Human 

Services shall be able to collect any information related 

to the prices of covered part D drugs under such program 
H. R. 3590—360 

and covered outpatient drugs under such title XIX necessary to carry out the comparison under subparagraph 

(A). 

(2) REPORT.— 

(A) IN GENERAL.—Not later than October 1, 2011, subject to subparagraph (B), the Inspector General shall 

submit to Congress a report containing the results of the 

study conducted under paragraph (1), together with recommendations for such legislation and administrative 

action as the Inspector General determines appropriate. 

(B) LIMITATION ON INFORMATION CONTAINED IN

REPORT.—The report submitted under subparagraph (A) 

shall not include any information that the Inspector General determines is proprietary or is likely to negatively 

impact the ability of a PDP sponsor or a State plan under 

title XIX to negotiate prices for covered part D drugs or 

covered outpatient drugs, respectively. 

(3) DEFINITIONS.—In this section: 

(A) COVERED PART D DRUG.—The term ‘‘covered part 

D drug’’ has the meaning given such term in section 1860D– 

2(e) of the Social Security Act (42 U.S.C. 1395w–102(e)). 

(B) COVERED OUTPATIENT DRUG.—The term ‘‘covered 

outpatient drug’’ has the meaning given such term in section 1927(k) of such Act (42 U.S.C. 1396r(k)). 

(C) MA–PD PLAN.—The term ‘‘MA–PD plan’’ has the 

meaning given such term in section 1860D–41(a)(9) of such 

Act (42 U.S.C. 1395w–151(a)(9)). 

(D) MEDICARE ADVANTAGE ORGANIZATION.—The term 

‘‘Medicare Advantage organization’’ has the meaning given 

such term in section 1859(a)(1) of such Act (42 U.S.C. 

1395w–28)(a)(1)). 

(E) PDP SPONSOR.—The term ‘‘PDP sponsor’’ has the 

meaning given such term in section 1860D–41(a)(13) of 

such Act (42 U.S.C. 1395w–151(a)(13)). 

(F) PRESCRIPTION DRUG PLAN.—The term ‘‘prescription 

drug plan’’ has the meaning given such term in section 

1860D–41(a)(14) of such Act (42 U.S.C. 1395w–151(a)(14)). 

SEC. 3314. INCLUDING COSTS INCURRED BY AIDS DRUG ASSISTANCE 

PROGRAMS AND INDIAN HEALTH SERVICE IN PROVIDING 

PRESCRIPTION DRUGS TOWARD THE ANNUAL OUT-OFPOCKET THRESHOLD UNDER PART D. 

(a) IN GENERAL.—Section 1860D–2(b)(4)(C) of the Social Security Act (42 U.S.C. 1395w–102(b)(4)(C)) is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii)— 

(A) by striking ‘‘such costs shall be treated as incurred 

only if’’ and inserting ‘‘subject to clause (iii), such costs 

shall be treated as incurred only if’’; 

(B) by striking ‘‘, under section 1860D–14, or under 

a State Pharmaceutical Assistance Program’’; and 

(C) by striking the period at the end and inserting 

‘‘; and’’; and 

(3) by inserting after clause (ii) the following new clause: 

‘‘(iii) such costs shall be treated as incurred and 

shall not be considered to be reimbursed under clause 

(ii) if such costs are borne or paid— 
H. R. 3590—361 

‘‘(I) under section 1860D–14; 

‘‘(II) under a State Pharmaceutical Assistance 

Program; 

‘‘(III) by the Indian Health Service, an Indian 

tribe or tribal organization, or an urban Indian 

organization (as defined in section 4 of the Indian 

Health Care Improvement Act); or 

‘‘(IV) under an AIDS Drug Assistance Program 

under part B of title XXVI of the Public Health 

Service Act.’’. 

(b) EFFECTIVE DATE.—The amendments made by subsection 

(a) shall apply to costs incurred on or after January 1, 2011. 

SEC. 3315. IMMEDIATE REDUCTION IN COVERAGE GAP IN 2010. 

Section 1860D–2(b) of the Social Security Act (42 U.S.C. 1395w– 

102(b)) is amended— 

(1) in paragraph (3)(A), by striking ‘‘paragraph (4)’’ and 

inserting ‘‘paragraphs (4) and (7)’’; and 

(2) by adding at the end the following new paragraph: 

‘‘(7) INCREASE IN INITIAL COVERAGE LIMIT IN 2010.— ‘‘(A) IN GENERAL.—For the plan year beginning on 

January 1, 2010, the initial coverage limit described in 

paragraph (3)(B) otherwise applicable shall be increased 

by $500. 

‘‘(B) APPLICATION.—In applying subparagraph (A)— 

‘‘(i) except as otherwise provided in this subparagraph, there shall be no change in the premiums, bids, 

or any other parameters under this part or part C; 

‘‘(ii) costs that would be treated as incurred costs 

for purposes of applying paragraph (4) but for the 

application of subparagraph (A) shall continue to be 

treated as incurred costs; 

‘‘(iii) the Secretary shall establish procedures, 

which may include a reconciliation process, to fully 

reimburse PDP sponsors with respect to prescription 

drug plans and MA organizations with respect to MA– 

PD plans for the reduction in beneficiary cost sharing 

associated with the application of subparagraph (A); 

‘‘(iv) the Secretary shall develop an estimate of 

the additional increased costs attributable to the 

application of this paragraph for increased drug utilization and financing and administrative costs and shall 

use such estimate to adjust payments to PDP sponsors 

with respect to prescription drug plans under this part 

and MA organizations with respect to MA–PD plans 

under part C; and 

‘‘(v) the Secretary shall establish procedures for 

retroactive reimbursement of part D eligible individuals who are covered under such a plan for costs which 

are incurred before the date of initial implementation 

of subparagraph (A) and which would be reimbursed 

under such a plan if such implementation occurred 

as of January 1, 2010. 

‘‘(C) NO EFFECT ON SUBSEQUENT YEARS.—The increase 

under subparagraph (A) shall only apply with respect to 

the plan year beginning on January 1, 2010, and the initial 

coverage limit for plan years beginning on or after January 
H. R. 3590—362 

1, 2011, shall be determined as if subparagraph (A) had 

never applied.’’. 

Subtitle E—Ensuring Medicare 

Sustainability 

SEC. 3401. REVISION OF CERTAIN MARKET BASKET UPDATES AND 

INCORPORATION OF PRODUCTIVITY IMPROVEMENTS 

INTO MARKET BASKET UPDATES THAT DO NOT ALREADY 

INCORPORATE SUCH IMPROVEMENTS. 

(a) INPATIENT ACUTE HOSPITALS.—Section 1886(b)(3)(B) of the 

Social Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended by 

section 3001(a)(3), is further amended— 

(1) in clause (i)(XX), by striking ‘‘clause (viii)’’ and inserting 

‘‘clauses (viii), (ix), (xi), and (xii)’’; 

(2) in the first sentence of clause (viii), by inserting ‘‘of 

such applicable percentage increase (determined without regard 

to clause (ix), (xi), or (xii))’’ after ‘‘one-quarter’’; 

(3) in the first sentence of clause (ix)(I), by inserting ‘‘(determined without regard to clause (viii), (xi), or (xii))’’ after ‘‘clause 

(i)’’ the second time it appears; and 

(4) by adding at the end the following new clauses: 

‘‘(xi)(I) For 2012 and each subsequent fiscal year, after determining the applicable percentage increase described in clause (i) 

and after application of clauses (viii) and (ix), such percentage 

increase shall be reduced by the productivity adjustment described 

in subclause (II). 

‘‘(II) The productivity adjustment described in this subclause, 

with respect to a percentage, factor, or update for a fiscal year, 

year, cost reporting period, or other annual period, is a productivity 

adjustment equal to the 10-year moving average of changes in 

annual economy-wide private nonfarm business multi-factor productivity (as projected by the Secretary for the 10-year period ending 

with the applicable fiscal year, year, cost reporting period, or other 

annual period). 

‘‘(III) The application of subclause (I) may result in the 

applicable percentage increase described in clause (i) being less 

than 0.0 for a fiscal year, and may result in payment rates under 

this section for a fiscal year being less than such payment rates 

for the preceding fiscal year. 

‘‘(xii) After determining the applicable percentage increase 

described in clause (i), and after application of clauses (viii), (ix), 

and (xi), the Secretary shall reduce such applicable percentage 

increase— 

‘‘(I) for each of fiscal years 2010 and 2011, by 0.25 percentage point; and 

‘‘(II) subject to clause (xiii), for each of fiscal years 2012 

through 2019, by 0.2 percentage point. 

The application of this clause may result in the applicable percentage increase described in clause (i) being less than 0.0 for a fiscal 

year, and may result in payment rates under this section for a 

fiscal year being less than such payment rates for the preceding 

fiscal year. 

‘‘(xiii) Clause (xii) shall be applied with respect to any of fiscal 

years 2014 through 2019 by substituting ‘0.0 percentage points’ 

for ‘0.2 percentage point’, if for such fiscal year— 
H. R. 3590—363 

‘‘(I) the excess (if any) of— 

‘‘(aa) the total percentage of the non-elderly insured 

population for the preceding fiscal year (based on the most 

recent estimates available from the Director of the Congressional Budget Office before a vote in either House on the 

Patient Protection and Affordable Care Act that, if determined in the affirmative, would clear such Act for enrollment); over 

‘‘(bb) the total percentage of the non-elderly insured 

population for such preceding fiscal year (as estimated 

by the Secretary); exceeds 

‘‘(II) 5 percentage points.’’. 

(b) SKILLED NURSING FACILITIES.—Section 1888(e)(5)(B) of the 

Social Security Act (42 U.S.C. 1395yy(e)(5)(B)) is amended— 

(1) by striking ‘‘PERCENTAGE.—The term’’ and inserting 

‘‘PERCENTAGE.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the term’’; 

and 

(2) by adding at the end the following new clause: 

‘‘(ii) ADJUSTMENT.—For fiscal year 2012 and each 

subsequent fiscal year, after determining the percentage described in clause (i), the Secretary shall reduce 

such percentage by the productivity adjustment 

described in section 1886(b)(3)(B)(xi)(II). The application of the preceding sentence may result in such 

percentage being less than 0.0 for a fiscal year, and 

may result in payment rates under this subsection 

for a fiscal year being less than such payment rates 

for the preceding fiscal year.’’. 

(c) LONG-TERM CARE HOSPITALS.—Section 1886(m) of the Social 

Security Act (42 U.S.C. 1395ww(m)) is amended by adding at the 

end the following new paragraphs: 

‘‘(3) IMPLEMENTATION FOR RATE YEAR 2010 AND SUBSEQUENT

YEARS.— ‘‘(A) IN GENERAL.—In implementing the system 

described in paragraph (1) for rate year 2010 and each 

subsequent rate year, any annual update to a standard 

Federal rate for discharges for the hospital during the 

rate year, shall be reduced— 

‘‘(i) for rate year 2012 and each subsequent rate 

year, by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II); and 

‘‘(ii) for each of rate years 2010 through 2019, 

by the other adjustment described in paragraph (4). 

‘‘(B) SPECIAL RULE.—The application of this paragraph 

may result in such annual update being less than 0.0 

for a rate year, and may result in payment rates under 

the system described in paragraph (1) for a rate year 

being less than such payment rates for the preceding rate 

year. 

‘‘(4) OTHER ADJUSTMENT.— ‘‘(A) IN GENERAL.—For purposes of paragraph (3)(A)(ii), 

the other adjustment described in this paragraph is— 

‘‘(i) for each of rate years 2010 and 2011, 0.25 

percentage point; and 

‘‘(ii) subject to subparagraph (B), for each of rate 

years 2012 through 2019, 0.2 percentage point. 
H. R. 3590—364 

‘‘(B) REDUCTION OF OTHER ADJUSTMENT.—Subparagraph (A)(ii) shall be applied with respect to any of rate 

years 2014 through 2019 by substituting ‘0.0 percentage 

points’ for ‘0.2 percentage point’, if for such rate year— 

‘‘(i) the excess (if any) of— 

‘‘(I) the total percentage of the non-elderly 

insured population for the preceding rate year 

(based on the most recent estimates available from 

the Director of the Congressional Budget Office 

before a vote in either House on the Patient Protection and Affordable Care Act that, if determined 

in the affirmative, would clear such Act for enrollment); over 

‘‘(II) the total percentage of the non-elderly 

insured population for such preceding rate year 

(as estimated by the Secretary); exceeds 

‘‘(ii) 5 percentage points.’’. 

(d) INPATIENT REHABILITATION FACILITIES.—Section 1886(j)(3) 

of the Social Security Act (42 U.S.C. 1395ww(j)(3)) is amended— 

(1) in subparagraph (C)— 

(A) by striking ‘‘FACTOR.—For purposes’’ and inserting 

‘‘FACTOR.— 

‘‘(i) IN GENERAL.—For purposes’’; 

(B) by inserting ‘‘subject to clause (ii)’’ before the period 

at the end of the first sentence of clause (i), as added 

by paragraph (1); and 

(C) by adding at the end the following new clause: 

‘‘(ii) PRODUCTIVITY AND OTHER ADJUSTMENT.—After 

establishing the increase factor described in clause (i) 

for a fiscal year, the Secretary shall reduce such 

increase factor— 

‘‘(I) for fiscal year 2012 and each subsequent 

fiscal year, by the productivity adjustment 

described in section 1886(b)(3)(B)(xi)(II); and 

‘‘(II) for each of fiscal years 2010 through 2019, 

by the other adjustment described in subparagraph 

(D). 

The application of this clause may result in the 

increase factor under this subparagraph being less 

than 0.0 for a fiscal year, and may result in payment 

rates under this subsection for a fiscal year being 

less than such payment rates for the preceding fiscal 

year.’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(D) OTHER ADJUSTMENT.— 

‘‘(i) IN GENERAL.—For purposes of subparagraph 

(C)(ii)(II), the other adjustment described in this 

subparagraph is— 

‘‘(I) for each of fiscal years 2010 and 2011, 

0.25 percentage point; and 

‘‘(II) subject to clause (ii), for each of fiscal 

years 2012 through 2019, 0.2 percentage point. 

‘‘(ii) REDUCTION OF OTHER ADJUSTMENT.—Clause 

(i)(II) shall be applied with respect to any of fiscal 

years 2014 through 2019 by substituting ‘0.0 percentage points’ for ‘0.2 percentage point’, if for such fiscal 

year— 
H. R. 3590—365 

‘‘(I) the excess (if any) of— 

‘‘(aa) the total percentage of the nonelderly insured population for the preceding 

fiscal year (based on the most recent estimates 

available from the Director of the Congressional Budget Office before a vote in either 

House on the Patient Protection and Affordable Care Act that, if determined in the 

affirmative, would clear such Act for enrollment); over 

‘‘(bb) the total percentage of the nonelderly insured population for such preceding 

fiscal year (as estimated by the Secretary); 

exceeds 

‘‘(II) 5 percentage points.’’. 

(e) HOME HEALTH AGENCIES.—Section 1895(b)(3)(B) of the 

Social Security Act (42 U.S.C. 1395fff(b)(3)(B)) is amended— 

(1) in clause (ii)(V), by striking ‘‘clause (v)’’ and inserting 

‘‘clauses (v) and (vi)’’; and 

(2) by adding at the end the following new clause: 

‘‘(vi) ADJUSTMENTS.—After determining the home 

health market basket percentage increase under clause 

(iii), and after application of clause (v), the Secretary 

shall reduce such percentage— 

‘‘(I) for 2015 and each subsequent year, by 

the productivity adjustment described in section 

1886(b)(3)(B)(xi)(II); and 

‘‘(II) for each of 2011 and 2012, by 1 percentage 

point. 

The application of this clause may result in the home 

health market basket percentage increase under clause 

(iii) being less than 0.0 for a year, and may result 

in payment rates under the system under this subsection for a year being less than such payment rates 

for the preceding year.’’. 

(f) PSYCHIATRIC HOSPITALS.—Section 1886 of the Social Security 

Act, as amended by sections 3001, 3008, 3025, and 3133, is amended 

by adding at the end the following new subsection: 

‘‘(s) PROSPECTIVE PAYMENT FOR PSYCHIATRIC HOSPITALS.— 

‘‘(1) REFERENCE TO ESTABLISHMENT AND IMPLEMENTATION

OF SYSTEM.—For provisions related to the establishment and 

implementation of a prospective payment system for payments 

under this title for inpatient hospital services furnished by 

psychiatric hospitals (as described in clause (i) of subsection 

(d)(1)(B)) and psychiatric units (as described in the matter 

following clause (v) of such subsection), see section 124 of 

the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act of 1999. 

‘‘(2) IMPLEMENTATION FOR RATE YEAR BEGINNING IN 2010

AND SUBSEQUENT RATE YEARS.— 

‘‘(A) IN GENERAL.—In implementing the system 

described in paragraph (1) for the rate year beginning 

in 2010 and any subsequent rate year, any update to a 

base rate for days during the rate year for a psychiatric 

hospital or unit, respectively, shall be reduced— 
H. R. 3590—366 

‘‘(i) for the rate year beginning in 2012 and each 

subsequent rate year, by the productivity adjustment 

described in section 1886(b)(3)(B)(xi)(II); and 

‘‘(ii) for each of the rate years beginning in 2010 

through 2019, by the other adjustment described in 

paragraph (3). 

‘‘(B) SPECIAL RULE.—The application of this paragraph 

may result in such update being less than 0.0 for a rate 

year, and may result in payment rates under the system 

described in paragraph (1) for a rate year being less than 

such payment rates for the preceding rate year. 

‘‘(3) OTHER ADJUSTMENT.— 

‘‘(A) IN GENERAL.—For purposes of paragraph (2)(A)(ii), 

the other adjustment described in this paragraph is— 

‘‘(i) for each of the rate years beginning in 2010 

and 2011, 0.25 percentage point; and 

‘‘(ii) subject to subparagraph (B), for each of the 

rate years beginning in 2012 through 2019, 0.2 percentage point. 

‘‘(B) REDUCTION OF OTHER ADJUSTMENT.—Subparagraph (A)(ii) shall be applied with respect to any of rate 

years 2014 through 2019 by substituting ‘0.0 percentage 

points’ for ‘0.2 percentage point’, if for such rate year— 

‘‘(i) the excess (if any) of— 

‘‘(I) the total percentage of the non-elderly 

insured population for the preceding rate year 

(based on the most recent estimates available from 

the Director of the Congressional Budget Office 

before a vote in either House on the Patient Protection and Affordable Care Act that, if determined 

in the affirmative, would clear such Act for enrollment); over 

‘‘(II) the total percentage of the non-elderly 

insured population for such preceding rate year 

(as estimated by the Secretary); exceeds 

‘‘(ii) 5 percentage points.’’. 

(g) HOSPICE CARE.—Section 1814(i)(1)(C) of the Social Security 

Act (42 U.S.C. 1395f(i)(1)(C)), as amended by section 3132, is 

amended by adding at the end the following new clauses: 

‘‘(iv) After determining the market basket percentage increase 

under clause (ii)(VII) or (iii), as applicable, with respect to fiscal 

year 2013 and each subsequent fiscal year, the Secretary shall 

reduce such percentage— 

‘‘(I) for 2013 and each subsequent fiscal year, by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II); and 

‘‘(II) subject to clause (v), for each of fiscal years 2013 

through 2019, by 0.5 percentage point. 

The application of this clause may result in the market basket 

percentage increase under clause (ii)(VII) or (iii), as applicable, 

being less than 0.0 for a fiscal year, and may result in payment 

rates under this subsection for a fiscal year being less than such 

payment rates for the preceding fiscal year. 

‘‘(v) Clause (iv)(II) shall be applied with respect to any of 

fiscal years 2014 through 2019 by substituting ‘0.0 percentage 

points’ for ‘0.5 percentage point’, if for such fiscal year— 

‘‘(I) the excess (if any) of— 
H. R. 3590—367 

‘‘(aa) the total percentage of the non-elderly insured 

population for the preceding fiscal year (based on the most 

recent estimates available from the Director of the Congressional Budget Office before a vote in either House on the 

Patient Protection and Affordable Care Act that, if determined in the affirmative, would clear such Act for enrollment); over 

‘‘(bb) the total percentage of the non-elderly insured 

population for such preceding fiscal year (as estimated 

by the Secretary); exceeds 

‘‘(II) 5 percentage points.’’. 

(h) DIALYSIS.—Section 1881(b)(14)(F) of the Social Security Act 

(42 U.S.C. 1395rr(b)(14)(F)) is amended— 

(1) in clause (i)— 

(A) by inserting ‘‘(I)’’ after ‘‘(F)(i)’’ 

(B) in subclause (I), as inserted by subparagraph (A)— 

(i) by striking ‘‘clause (ii)’’ and inserting ‘‘subclause 

(II) and clause (ii)’’; and 

(ii) by striking ‘‘minus 1.0 percentage point’’; and 

(C) by adding at the end the following new subclause: 

‘‘(II) For 2012 and each subsequent year, after determining 

the increase factor described in subclause (I), the Secretary shall 

reduce such increase factor by the productivity adjustment described 

in section 1886(b)(3)(B)(xi)(II). The application of the preceding 

sentence may result in such increase factor being less than 0.0 

for a year, and may result in payment rates under the payment 

system under this paragraph for a year being less than such payment rates for the preceding year.’’; and 

(2) in clause (ii)(II)— 

(A) by striking ‘‘The’’ and inserting ‘‘Subject to clause 

(i)(II), the’’; and 

(B) by striking ‘‘clause (i) minus 1.0 percentage point’’ 

and inserting ‘‘clause (i)(I)’’. 

(i) OUTPATIENT HOSPITALS.—Section 1833(t)(3) of the Social 

Security Act (42 U.S.C. 1395l(t)(3)) is amended— 

(1) in subparagraph (C)(iv), by inserting ‘‘and subparagraph 

(F) of this paragraph’’ after ‘‘(17)’’; and 

(2) by adding at the end the following new subparagraphs: 

‘‘(F) PRODUCTIVITY AND OTHER ADJUSTMENT.—After 

determining the OPD fee schedule increase factor under 

subparagraph (C)(iv), the Secretary shall reduce such 

increase factor— 

‘‘(i) for 2012 and subsequent years, by the productivity adjustment described in section 

1886(b)(3)(B)(xi)(II); and 

‘‘(ii) for each of 2010 through 2019, by the adjustment described in subparagraph (G). 

The application of this subparagraph may result in the 

increase factor under subparagraph (C)(iv) being less than 

0.0 for a year, and may result in payment rates under 

the payment system under this subsection for a year being 

less than such payment rates for the preceding year. 

‘‘(G) OTHER ADJUSTMENT.— 

‘‘(i) ADJUSTMENT.—For purposes of subparagraph 

(F)(ii), the adjustment described in this subparagraph 

is— 
H. R. 3590—368 

‘‘(I) for each of 2010 and 2011, 0.25 percentage 

point; and 

‘‘(II) subject to clause (ii), for each of 2012 

through 2019, 0.2 percentage point. 

‘‘(ii) REDUCTION OF OTHER ADJUSTMENT.—Clause 

(i)(II) shall be applied with respect to any of 2014 

through 2019 by substituting ‘0.0 percentage points’ 

for ‘0.2 percentage point’, if for such year— 

‘‘(I) the excess (if any) of— 

‘‘(aa) the total percentage of the nonelderly insured population for the preceding 

year (based on the most recent estimates available from the Director of the Congressional 

Budget Office before a vote in either House 

on the Patient Protection and Affordable Care 

Act that, if determined in the affirmative, 

would clear such Act for enrollment); over 

‘‘(bb) the total percentage of the nonelderly insured population for such preceding 

year (as estimated by the Secretary); exceeds 

‘‘(II) 5 percentage points.’’. 

(j) AMBULANCE SERVICES.—Section 1834(l)(3) of the Social Security Act (42 U.S.C. 1395m(l)(3)) is amended— 

(1) in subparagraph (A), by striking ‘‘and’’ at the end; 

(2) in subparagraph (B)— 

(A) by inserting ‘‘, subject to subparagraph (C) and 

the succeeding sentence of this paragraph,’’ after 

‘‘increased’’; and 

(B) by striking the period at the end and inserting 

‘‘; and’’; 

(3) by adding at the end the following new subparagraph: 

‘‘(C) for 2011 and each subsequent year, after determining the percentage increase under subparagraph (B) 

for the year, reduce such percentage increase by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II).’’; 

and 

(4) by adding at the end the following flush sentence: 

‘‘The application of subparagraph (C) may result in the percentage increase under subparagraph (B) being less than 0.0 for 

a year, and may result in payment rates under the fee schedule 

under this subsection for a year being less than such payment 

rates for the preceding year.’’. 

(k) AMBULATORY SURGICAL CENTER SERVICES.—Section 

1833(i)(2)(D) of the Social Security Act (42 U.S.C. 1395l(i)(2)(D)) 

is amended— 

(1) by redesignating clause (v) as clause (vi); and 

(2) by inserting after clause (iv) the following new clause: 

‘‘(v) In implementing the system described in 

clause (i) for 2011 and each subsequent year, any 

annual update under such system for the year, after 

application of clause (iv), shall be reduced by the 

productivity adjustment described in section 

1886(b)(3)(B)(xi)(II). The application of the preceding 

sentence may result in such update being less than 

0.0 for a year, and may result in payment rates under 

the system described in clause (i) for a year being 

less than such payment rates for the preceding year.’’. 
H. R. 3590—369 

(l) LABORATORY SERVICES.—Section 1833(h)(2)(A) of the Social 

Security Act (42 U.S.C. 1395l(h)(2)(A)) is amended— 

(1) in clause (i)— 

(A) by inserting ‘‘, subject to clause (iv),’’ after ‘‘year) 

by’’; and 

(B) by striking ‘‘through 2013’’ and inserting ‘‘and 

2010’’; and 

(2) by adding at the end the following new clause: 

‘‘(iv) After determining the adjustment to the fee 

schedules under clause (i), the Secretary shall reduce 

such adjustment— 

‘‘(I) for 2011 and each subsequent year, by 

the productivity adjustment described in section 

1886(b)(3)(B)(xi)(II); and 

‘‘(II) for each of 2011 through 2015, by 1.75 

percentage points. 

Subclause (I) shall not apply in a year where the 

adjustment to the fee schedules determined under 

clause (i) is 0.0 or a percentage decrease for a year. 

The application of the productivity adjustment under 

subclause (I) shall not result in an adjustment to the 

fee schedules under clause (i) being less than 0.0 for 

a year. The application of subclause (II) may result 

in an adjustment to the fee schedules under clause 

(i) being less than 0.0 for a year, and may result 

in payment rates for a year being less than such payment rates for the preceding year.’’. 

(m) CERTAIN DURABLE MEDICAL EQUIPMENT.—Section 

1834(a)(14) of the Social Security Act (42 U.S.C. 1395m(a)(14)) 

is amended— 

(1) in subparagraph (K)— 

(A) by striking ‘‘2011, 2012, and 2013,’’; and 

(B) by inserting ‘‘and’’ after the semicolon at the end; 

(2) by striking subparagraphs (L) and (M) and inserting 

the following new subparagraph: 

‘‘(L) for 2011 and each subsequent year— 

‘‘(i) the percentage increase in the consumer price 

index for all urban consumers (United States city average) for the 12-month period ending with June of the 

previous year, reduced by— 

‘‘(ii) the productivity adjustment described in section 1886(b)(3)(B)(xi)(II).’’; and 

(3) by adding at the end the following flush sentence: 

‘‘The application of subparagraph (L)(ii) may result in the covered item update under this paragraph being less than 0.0 

for a year, and may result in payment rates under this subsection for a year being less than such payment rates for 

the preceding year.’’. 

(n) PROSTHETIC DEVICES, ORTHOTICS, AND PROSTHETICS.—Section 1834(h)(4) of the Social Security Act (42 U.S.C. 1395m(h)(4)) 

is amended— 

(1) in subparagraph (A)— 

(A) in clause (ix), by striking ‘‘and’’ at the end; 

(B) in clause (x)— 

(i) by striking ‘‘a subsequent year’’ and inserting 

‘‘for each of 2007 through 2010’’; and 
H. R. 3590—370 

(ii) by inserting ‘‘and’’ after the semicolon at the 

end; 

(C) by adding at the end the following new clause: 

‘‘(xi) for 2011 and each subsequent year— 

‘‘(I) the percentage increase in the consumer 

price index for all urban consumers (United States 

city average) for the 12-month period ending with 

June of the previous year, reduced by— 

‘‘(II) the productivity adjustment described in 

section 1886(b)(3)(B)(xi)(II).’’; and 

(D) by adding at the end the following flush sentence: 

‘‘The application of subparagraph (A)(xi)(II) may result in the 

applicable percentage increase under subparagraph (A) being 

less than 0.0 for a year, and may result in payment rates 

under this subsection for a year being less than such payment 

rates for the preceding year.’’. 

(o) OTHER ITEMS.—Section 1842(s)(1) of the Social Security 

Act (42 U.S.C. 1395u(s)(1)) is amended— 

(1) in the first sentence, by striking ‘‘Subject to’’ and 

inserting ‘‘(A) Subject to’’; 

(2) by striking the second sentence and inserting the following new subparagraph: 

‘‘(B) Any fee schedule established under this paragraph 

for such item or service shall be updated— 

‘‘(i) for years before 2011— 

‘‘(I) subject to subclause (II), by the percentage 

increase in the consumer price index for all urban 

consumers (United States city average) for the 12- 

month period ending with June of the preceding 

year; and 

‘‘(II) for items and services described in paragraph (2)(D) for 2009, section 1834(a)(14)(J) shall 

apply under this paragraph instead of the percentage increase otherwise applicable; and 

‘‘(ii) for 2011 and subsequent years— 

‘‘(I) the percentage increase in the consumer 

price index for all urban consumers (United States 

city average) for the 12-month period ending with 

June of the previous year, reduced by— 

‘‘(II) the productivity adjustment described in 

section 1886(b)(3)(B)(xi)(II).’’; and 

(3) by adding at the end the following flush sentence: 

‘‘The application of subparagraph (B)(ii)(II) may result in the 

update under this paragraph being less than 0.0 for a year, 

and may result in payment rates under any fee schedule established under this paragraph for a year being less than such 

payment rates for the preceding year.’’. 

(p) NO APPLICATION PRIOR TO APRIL 1, 2010.—Notwithstanding 

the preceding provisions of this section, the amendments made 

by subsections (a), (c), and (d) shall not apply to discharges occurring 

before April 1, 2010. 

SEC. 3402. TEMPORARY ADJUSTMENT TO THE CALCULATION OF PART 

B PREMIUMS. 

Section 1839(i) of the Social Security Act (42 U.S.C. 1395r(i)) 

is amended— 
H. R. 3590—371 

(1) in paragraph (2), in the matter preceding subparagraph 

(A), by inserting ‘‘subject to paragraph (6),’’ after ‘‘subsection,’’; 

(2) in paragraph (3)(A)(i), by striking ‘‘The applicable’’ and 

inserting ‘‘Subject to paragraph (6), the applicable’’; 

(3) by redesignating paragraph (6) as paragraph (7); and 

(4) by inserting after paragraph (5) the following new paragraph: 

‘‘(6) TEMPORARY ADJUSTMENT TO INCOME THRESHOLDS.— 

Notwithstanding any other provision of this subsection, during 

the period beginning on January 1, 2011, and ending on 

December 31, 2019— 

‘‘(A) the threshold amount otherwise applicable under 

paragraph (2) shall be equal to such amount for 2010; 

and 

‘‘(B) the dollar amounts otherwise applicable under 

paragraph (3)(C)(i) shall be equal to such dollar amounts 

for 2010.’’. 

SEC. 3403. INDEPENDENT MEDICARE ADVISORY BOARD. 

(a) BOARD.— 

(1) IN GENERAL.—Title XVIII of the Social Security Act 

(42 U.S.C. 1395 et seq.), as amended by section 3022, is 

amended by adding at the end the following new section: 

‘‘INDEPENDENT MEDICARE ADVISORY BOARD

‘‘SEC. 1899A. (a) ESTABLISHMENT.—There is established an 

independent board to be known as the ‘Independent Medicare 

Advisory Board’. 

‘‘(b) PURPOSE.—It is the purpose of this section to, in accordance 

with the following provisions of this section, reduce the per capita 

rate of growth in Medicare spending— 

‘‘(1) by requiring the Chief Actuary of the Centers for 

Medicare & Medicaid Services to determine in each year to 

which this section applies (in this section referred to as ‘a 

determination year’) the projected per capita growth rate under 

Medicare for the second year following the determination year 

(in this section referred to as ‘an implementation year’); 

‘‘(2) if the projection for the implementation year exceeds 

the target growth rate for that year, by requiring the Board 

to develop and submit during the first year following the determination year (in this section referred to as ‘a proposal year’) 

a proposal containing recommendations to reduce the Medicare 

per capita growth rate to the extent required by this section; 

and 

‘‘(3) by requiring the Secretary to implement such proposals 

unless Congress enacts legislation pursuant to this section. 

‘‘(c) BOARD PROPOSALS.— ‘‘(1) DEVELOPMENT.— ‘‘(A) IN GENERAL.—The Board shall develop detailed 

and specific proposals related to the Medicare program 

in accordance with the succeeding provisions of this section. 

‘‘(B) ADVISORY REPORTS.—Beginning January 15, 2014, 

the Board may develop and submit to Congress advisory 

reports on matters related to the Medicare program, regardless of whether or not the Board submitted a proposal 

for such year. Such a report may, for years prior to 2020, 
H. R. 3590—372 

include recommendations regarding improvements to payment systems for providers of services and suppliers who 

are not otherwise subject to the scope of the Board’s recommendations in a proposal under this section. Any 

advisory report submitted under this subparagraph shall 

not be subject to the rules for congressional consideration 

under subsection (d). 

‘‘(2) PROPOSALS.— 

‘‘(A) REQUIREMENTS.—Each proposal submitted under 

this section in a proposal year shall meet each of the 

following requirements: 

‘‘(i) If the Chief Actuary of the Centers for Medicare 

& Medicaid Services has made a determination under 

paragraph (7)(A) in the determination year, the proposal shall include recommendations so that the proposal as a whole (after taking into account recommendations under clause (v)) will result in a net 

reduction in total Medicare program spending in the 

implementation year that is at least equal to the 

applicable savings target established under paragraph 

(7)(B) for such implementation year. In determining 

whether a proposal meets the requirement of the preceding sentence, reductions in Medicare program 

spending during the 3-month period immediately preceding the implementation year shall be counted to 

the extent that such reductions are a result of the 

implementation of recommendations contained in the 

proposal for a change in the payment rate for an item 

or service that was effective during such period pursuant to subsection (e)(2)(A). 

‘‘(ii) The proposal shall not include any recommendation to ration health care, raise revenues or 

Medicare beneficiary premiums under section 1818, 

1818A, or 1839, increase Medicare beneficiary costsharing (including deductibles, coinsurance, and copayments), or otherwise restrict benefits or modify eligibility criteria. 

‘‘(iii) In the case of proposals submitted prior to 

December 31, 2018, the proposal shall not include any 

recommendation that would reduce payment rates for 

items and services furnished, prior to December 31, 

2019, by providers of services (as defined in section 

1861(u)) and suppliers (as defined in section 1861(d)) 

scheduled, pursuant to the amendments made by section 3401 of the Patient Protection and Affordable Care 

Act, to receive a reduction to the inflationary payment 

updates of such providers of services and suppliers 

in excess of a reduction due to productivity in a year 

in which such recommendations would take effect. 

‘‘(iv) As appropriate, the proposal shall include 

recommendations to reduce Medicare payments under 

parts C and D, such as reductions in direct subsidy 

payments to Medicare Advantage and prescription drug 

plans specified under paragraph (1) and (2) of section 

1860D–15(a) that are related to administrative 

expenses (including profits) for basic coverage, denying 

high bids or removing high bids for prescription drug 
H. R. 3590—373 

coverage from the calculation of the national average 

monthly bid amount under section 1860D–13(a)(4), and 

reductions in payments to Medicare Advantage plans 

under clauses (i) and (ii) of section 1853(a)(1)(B) that 

are related to administrative expenses (including 

profits) and performance bonuses for Medicare Advantage plans under section 1853(n). Any such recommendation shall not affect the base beneficiary premium percentage specified under 1860D–13(a). 

‘‘(v) The proposal shall include recommendations 

with respect to administrative funding for the Secretary to carry out the recommendations contained 

in the proposal. 

‘‘(vi) The proposal shall only include recommendations related to the Medicare program. 

‘‘(B) ADDITIONAL CONSIDERATIONS.—In developing and 

submitting each proposal under this section in a proposal 

year, the Board shall, to the extent feasible— 

‘‘(i) give priority to recommendations that extend 

Medicare solvency; 

‘‘(ii) include recommendations that— 

‘‘(I) improve the health care delivery system 

and health outcomes, including by promoting 

integrated care, care coordination, prevention and 

wellness, and quality and efficiency improvement; 

and 

‘‘(II) protect and improve Medicare beneficiaries’ access to necessary and evidence-based 

items and services, including in rural and frontier 

areas; 

‘‘(iii) include recommendations that target reductions in Medicare program spending to sources of 

excess cost growth; 

‘‘(iv) consider the effects on Medicare beneficiaries 

of changes in payments to providers of services (as 

defined in section 1861(u)) and suppliers (as defined 

in section 1861(d)); 

‘‘(v) consider the effects of the recommendations 

on providers of services and suppliers with actual or 

projected negative cost margins or payment updates; 

and 

‘‘(vi) consider the unique needs of Medicare beneficiaries who are dually eligible for Medicare and the 

Medicaid program under title XIX. 

‘‘(C) NO INCREASE IN TOTAL MEDICARE PROGRAM

SPENDING.—Each proposal submitted under this section 

shall be designed in such a manner that implementation 

of the recommendations contained in the proposal would 

not be expected to result, over the 10-year period starting 

with the implementation year, in any increase in the total 

amount of net Medicare program spending relative to the 

total amount of net Medicare program spending that would 

have occurred absent such implementation. 

‘‘(D) CONSULTATION WITH MEDPAC.—The Board shall 

submit a draft copy of each proposal to be submitted under 

this section to the Medicare Payment Advisory Commission 

established under section 1805 for its review. The Board 
H. R. 3590—374 

shall submit such draft copy by not later than September 

1 of the determination year. 

‘‘(E) REVIEW AND COMMENT BY THE SECRETARY.—The 

Board shall submit a draft copy of each proposal to be 

submitted to Congress under this section to the Secretary 

for the Secretary’s review and comment. The Board shall 

submit such draft copy by not later than September 1 

of the determination year. Not later than March 1 of the 

submission year, the Secretary shall submit a report to 

Congress on the results of such review, unless the Secretary 

submits a proposal under paragraph (5)(A) in that year. 

‘‘(F) CONSULTATIONS.—In carrying out its duties under 

this section, the Board shall engage in regular consultations 

with the Medicaid and CHIP Payment and Access Commission under section 1900. 

‘‘(3) TRANSMISSION OF BOARD PROPOSAL TO PRESIDENT.— 

‘‘(A) IN GENERAL.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii) and subsection (f)(3)(B), the Board shall transmit 

a proposal under this section to the President on 

January 15 of each year (beginning with 2014). 

‘‘(ii) EXCEPTION.—The Board shall not submit a 

proposal under clause (i) in a proposal year if the 

year is— 

‘‘(I) a year for which the Chief Actuary of 

the Centers for Medicare & Medicaid Services 

makes a determination in the determination year 

under paragraph (6)(A) that the growth rate 

described in clause (i) of such paragraph does not 

exceed the growth rate described in clause (ii) 

of such paragraph; 

‘‘(II) a year in which the Chief Actuary of 

the Centers for Medicare & Medicaid Services 

makes a determination in the determination year 

that the projected percentage increase (if any) for 

the medical care expenditure category of the Consumer Price Index for All Urban Consumers 

(United States city average) for the implementation year is less than the projected percentage 

increase (if any) in the Consumer Price Index for 

All Urban Consumers (all items; United States 

city average) for such implementation year; or 

‘‘(III) for proposal year 2019 and subsequent 

proposal years, a year in which the Chief Actuary 

of the Centers for Medicare & Medicaid Services 

makes a determination in the determination year 

that the growth rate described in paragraph (8) 

exceeds the growth rate described in paragraph 

(6)(A)(i). 

‘‘(iii) START-UP PERIOD.—The Board may not 

submit a proposal under clause (i) prior to January 

15, 2014. 

‘‘(B) REQUIRED INFORMATION.—Each proposal submitted by the Board under subparagraph (A)(i) shall 

include— 

‘‘(i) the recommendations described in paragraph 

(2)(A)(i); 
H. R. 3590—375 

‘‘(ii) an explanation of each recommendation contained in the proposal and the reasons for including 

such recommendation; 

‘‘(iii) an actuarial opinion by the Chief Actuary 

of the Centers for Medicare & Medicaid Services certifying that the proposal meets the requirements of subparagraphs (A)(i) and (C) of paragraph (2); 

‘‘(iv) a legislative proposal that implements the 

recommendations; and 

‘‘(v) other information determined appropriate by 

the Board. 

‘‘(4) PRESIDENTIAL SUBMISSION TO CONGRESS.—Upon 

receiving a proposal from the Board under paragraph (3)(A)(i) 

or the Secretary under paragraph (5), the President shall immediately submit such proposal to Congress. 

‘‘(5) CONTINGENT SECRETARIAL DEVELOPMENT OF PROPOSAL.—If, with respect to a proposal year, the Board is 

required, to but fails, to submit a proposal to the President 

by the deadline applicable under paragraph (3)(A)(i), the Secretary shall develop a detailed and specific proposal that satisfies the requirements of subparagraphs (A) and (C) (and, to 

the extent feasible, subparagraph (B)) of paragraph (2) and 

contains the information required paragraph (3)(B)). By not 

later than January 25 of the year, the Secretary shall 

transmit— 

‘‘(A) such proposal to the President; and 

‘‘(B) a copy of such proposal to the Medicare Payment 

Advisory Commission for its review. 

‘‘(6) PER CAPITA GROWTH RATE PROJECTIONS BY CHIEF

ACTUARY.— 

‘‘(A) IN GENERAL.—Subject to subsection (f)(3)(A), not 

later than April 30, 2013, and annually thereafter, the 

Chief Actuary of the Centers for Medicare & Medicaid 

Services shall determine in each such year whether— 

‘‘(i) the projected Medicare per capita growth rate 

for the implementation year (as determined under 

subparagraph (B)); exceeds 

‘‘(ii) the projected Medicare per capita target 

growth rate for the implementation year (as determined under subparagraph (C)). 

‘‘(B) MEDICARE PER CAPITA GROWTH RATE.— 

‘‘(i) IN GENERAL.—For purposes of this section, the 

Medicare per capita growth rate for an implementation 

year shall be calculated as the projected 5-year average 

(ending with such year) of the growth in Medicare 

program spending per unduplicated enrollee. 

‘‘(ii) REQUIREMENT.—The projection under clause 

(i) shall— 

‘‘(I) to the extent that there is projected to 

be a negative update to the single conversion factor 

applicable to payments for physicians’ services 

under section 1848(d) furnished in the proposal 

year or the implementation year, assume that such 

update for such services is 0 percent rather than 

the negative percent that would otherwise apply; 

and 
H. R. 3590—376 

‘‘(II) take into account any delivery system 

reforms or other payment changes that have been 

enacted or published in final rules but not yet 

implemented as of the making of such calculation. 

‘‘(C) MEDICARE PER CAPITA TARGET GROWTH RATE.— 

For purposes of this section, the Medicare per capita target 

growth rate for an implementation year shall be calculated 

as the projected 5-year average (ending with such year) 

percentage increase in— 

‘‘(i) with respect to a determination year that is 

prior to 2018, the average of the projected percentage 

increase (if any) in— 

‘‘(I) the Consumer Price Index for All Urban 

Consumers (all items; United States city average); 

and 

‘‘(II) the medical care expenditure category of 

the Consumer Price Index for All Urban Consumers (United States city average); and 

‘‘(ii) with respect to a determination year that is 

after 2017, the nominal gross domestic product per 

capita plus 1.0 percentage point. 

‘‘(7) SAVINGS REQUIREMENT.— 

‘‘(A) IN GENERAL.—If, with respect to a determination 

year, the Chief Actuary of the Centers for Medicare & 

Medicaid Services makes a determination under paragraph 

(6)(A) that the growth rate described in clause (i) of such 

paragraph exceeds the growth rate described in clause 

(ii) of such paragraph, the Chief Actuary shall establish 

an applicable savings target for the implementation year. 

‘‘(B) APPLICABLE SAVINGS TARGET.—For purposes of this 

section, the applicable savings target for an implementation 

year shall be an amount equal to the product of— 

‘‘(i) the total amount of projected Medicare program 

spending for the proposal year; and 

‘‘(ii) the applicable percent for the implementation 

year. 

‘‘(C) APPLICABLE PERCENT.—For purposes of subparagraph (B), the applicable percent for an implementation 

year is the lesser of— 

‘‘(i) in the case of— 

‘‘(I) implementation year 2015, 0.5 percent; 

‘‘(II) implementation year 2016, 1.0 percent; 

‘‘(III) implementation year 2017, 1.25 percent; 

and 

‘‘(IV) implementation year 2018 or any subsequent implementation year, 1.5 percent; and 

‘‘(ii) the projected excess for the implementation 

year (expressed as a percent) determined under 

subparagraph (A). 

‘‘(8) PER CAPITA RATE OF GROWTH IN NATIONAL HEALTH

EXPENDITURES.—In each determination year (beginning in 

2018), the Chief Actuary of the Centers for Medicare & Medicaid Services shall project the per capita rate of growth in 

national health expenditures for the implementation year. Such 

rate of growth for an implementation year shall be calculated 

as the projected 5-year average (ending with such year) percentage increase in national health care expenditures. 
H. R. 3590—377 

‘‘(d) CONGRESSIONAL CONSIDERATION.— 

‘‘(1) INTRODUCTION.— 

‘‘(A) IN GENERAL.—On the day on which a proposal 

is submitted by the President to the House of Representatives and the Senate under subsection (c)(4), the legislative 

proposal (described in subsection (c)(3)(B)(iv)) contained in 

the proposal shall be introduced (by request) in the Senate 

by the majority leader of the Senate or by Members of 

the Senate designated by the majority leader of the Senate 

and shall be introduced (by request) in the House by the 

majority leader of the House or by Members of the House 

designated by the majority leader of the House. 

‘‘(B) NOT IN SESSION.—If either House is not in session 

on the day on which such legislative proposal is submitted, 

the legislative proposal shall be introduced in that House, 

as provided in subparagraph (A), on the first day thereafter 

on which that House is in session. 

‘‘(C) ANY MEMBER.—If the legislative proposal is not 

introduced in either House within 5 days on which that 

House is in session after the day on which the legislative 

proposal is submitted, then any Member of that House 

may introduce the legislative proposal. 

‘‘(D) REFERRAL.—The legislation introduced under this 

paragraph shall be referred by the Presiding Officers of 

the respective Houses to the Committee on Finance in 

the Senate and to the Committee on Energy and Commerce 

and the Committee on Ways and Means in the House 

of Representatives. 

‘‘(2) COMMITTEE CONSIDERATION OF PROPOSAL.— 

‘‘(A) REPORTING BILL.—Not later than April 1 of any 

proposal year in which a proposal is submitted by the 

President to Congress under this section, the Committee 

on Ways and Means and the Committee on Energy and 

Commerce of the House of Representatives and the Committee on Finance of the Senate may report the bill referred 

to the Committee under paragraph (1)(D) with committee 

amendments related to the Medicare program. 

‘‘(B) CALCULATIONS.—In determining whether a committee amendment meets the requirement of subparagraph 

(A), the reductions in Medicare program spending during 

the 3-month period immediately preceding the implementation year shall be counted to the extent that such reductions 

are a result of the implementation provisions in the committee amendment for a change in the payment rate for 

an item or service that was effective during such period 

pursuant to such amendment. 

‘‘(C) COMMITTEE JURISDICTION.—Notwithstanding rule 

XV of the Standing Rules of the Senate, a committee 

amendment described in subparagraph (A) may include 

matter not within the jurisdiction of the Committee on 

Finance if that matter is relevant to a proposal contained 

in the bill submitted under subsection (c)(3). 

‘‘(D) DISCHARGE.—If, with respect to the House 

involved, the committee has not reported the bill by the 

date required by subparagraph (A), the committee shall 

be discharged from further consideration of the proposal. 
H. R. 3590—378 

‘‘(3) LIMITATION ON CHANGES TO THE BOARD RECOMMENDATIONS.— 

‘‘(A) IN GENERAL.—It shall not be in order in the Senate 

or the House of Representatives to consider any bill, resolution, or amendment, pursuant to this subsection or conference report thereon, that fails to satisfy the requirements 

of subparagraphs (A)(i) and (C) of subsection (c)(2). 

‘‘(B) LIMITATION ON CHANGES TO THE BOARD RECOMMENDATIONS IN OTHER LEGISLATION.—It shall not be 

in order in the Senate or the House of Representatives 

to consider any bill, resolution, amendment, or conference 

report (other than pursuant to this section) that would 

repeal or otherwise change the recommendations of the 

Board if that change would fail to satisfy the requirements 

of subparagraphs (A)(i) and (C) of subsection (c)(2). 

‘‘(C) LIMITATION ON CHANGES TO THIS SUBSECTION.— 

It shall not be in order in the Senate or the House of 

Representatives to consider any bill, resolution, amendment, or conference report that would repeal or otherwise 

change this subsection. 

‘‘(D) WAIVER.—This paragraph may be waived or suspended in the Senate only by the affirmative vote of threefifths of the Members, duly chosen and sworn. 

‘‘(E) APPEALS.—An affirmative vote of three-fifths of 

the Members of the Senate, duly chosen and sworn, shall 

be required in the Senate to sustain an appeal of the 

ruling of the Chair on a point of order raised under this 

paragraph. 

‘‘(4) EXPEDITED PROCEDURE.— 

‘‘(A) CONSIDERATION.—A motion to proceed to the 

consideration of the bill in the Senate is not debatable. 

‘‘(B) AMENDMENT.— 

‘‘(i) TIME LIMITATION.—Debate in the Senate on 

any amendment to a bill under this section shall be 

limited to 1 hour, to be equally divided between, and 

controlled by, the mover and the manager of the bill, 

and debate on any amendment to an amendment, 

debatable motion, or appeal shall be limited to 30 

minutes, to be equally divided between, and controlled 

by, the mover and the manager of the bill, except 

that in the event the manager of the bill is in favor 

of any such amendment, motion, or appeal, the time 

in opposition thereto shall be controlled by the minority 

leader or such leader’s designee. 

‘‘(ii) GERMANE.—No amendment that is not germane to the provisions of such bill shall be received. 

‘‘(iii) ADDITIONAL TIME.—The leaders, or either of 

them, may, from the time under their control on the 

passage of the bill, allot additional time to any Senator 

during the consideration of any amendment, debatable 

motion, or appeal. 

‘‘(iv) AMENDMENT NOT IN ORDER.—It shall not be 

in order to consider an amendment that would cause 

the bill to result in a net reduction in total Medicare 

program spending in the implementation year that 

is less than the applicable savings target established 
H. R. 3590—379 

under subsection (c)(7)(B) for such implementation 

year. 

‘‘(v) WAIVER AND APPEALS.—This paragraph may 

be waived or suspended in the Senate only by the 

affirmative vote of three-fifths of the Members, duly 

chosen and sworn. An affirmative vote of three-fifths 

of the Members of the Senate, duly chosen and sworn, 

shall be required in the Senate to sustain an appeal 

of the ruling of the Chair on a point of order raised 

under this section. 

‘‘(C) CONSIDERATION BY THE OTHER HOUSE.— ‘‘(i) IN GENERAL.—The expedited procedures provided in this subsection for the consideration of a bill 

introduced pursuant to paragraph (1) shall not apply 

to such a bill that is received by one House from 

the other House if such a bill was not introduced 

in the receiving House. 

‘‘(ii) BEFORE PASSAGE.—If a bill that is introduced 

pursuant to paragraph (1) is received by one House 

from the other House, after introduction but before 

disposition of such a bill in the receiving House, then 

the following shall apply: 

‘‘(I) The receiving House shall consider the 

bill introduced in that House through all stages 

of consideration up to, but not including, passage. 

‘‘(II) The question on passage shall be put 

on the bill of the other House as amended by 

the language of the receiving House. 

‘‘(iii) AFTER PASSAGE.—If a bill introduced pursuant 

to paragraph (1) is received by one House from the 

other House, after such a bill is passed by the receiving 

House, then the vote on passage of the bill that originates in the receiving House shall be considered to 

be the vote on passage of the bill received from the 

other House as amended by the language of the 

receiving House. 

‘‘(iv) DISPOSITION.—Upon disposition of a bill introduced pursuant to paragraph (1) that is received by 

one House from the other House, it shall no longer 

be in order to consider the bill that originates in the 

receiving House. 

‘‘(v) LIMITATION.—Clauses (ii), (iii), and (iv) shall 

apply only to a bill received by one House from the 

other House if the bill— 

‘‘(I) is related only to the program under this 

title; and 

‘‘(II) satisfies the requirements of subparagraphs (A)(i) and (C) of subsection (c)(2). 

‘‘(D) SENATE LIMITS ON DEBATE.— ‘‘(i) IN GENERAL.—In the Senate, consideration of 

the bill and on all debatable motions and appeals in 

connection therewith shall not exceed a total of 30 

hours, which shall be divided equally between the 

majority and minority leaders or their designees. 

‘‘(ii) MOTION TO FURTHER LIMIT DEBATE.—A motion 

to further limit debate on the bill is in order and 

is not debatable. 
H. R. 3590—380 

‘‘(iii) MOTION OR APPEAL.—Any debatable motion 

or appeal is debatable for not to exceed 1 hour, to 

be divided equally between those favoring and those 

opposing the motion or appeal. 

‘‘(iv) FINAL DISPOSITION.—After 30 hours of consideration, the Senate shall proceed, without any further 

debate on any question, to vote on the final disposition 

thereof to the exclusion of all amendments not then 

pending before the Senate at that time and to the 

exclusion of all motions, except a motion to table, or 

to reconsider and one quorum call on demand to establish the presence of a quorum (and motions required 

to establish a quorum) immediately before the final 

vote begins. 

‘‘(E) CONSIDERATION IN CONFERENCE.— 

‘‘(i) IN GENERAL.—Consideration in the Senate and 

the House of Representatives on the conference report 

or any messages between Houses shall be limited to 

10 hours, equally divided and controlled by the 

majority and minority leaders of the Senate or their 

designees and the Speaker of the House of Representatives and the minority leader of the House of Representatives or their designees. 

‘‘(ii) TIME LIMITATION.—Debate in the Senate on 

any amendment under this subparagraph shall be limited to 1 hour, to be equally divided between, and 

controlled by, the mover and the manager of the bill, 

and debate on any amendment to an amendment, 

debatable motion, or appeal shall be limited to 30 

minutes, to be equally divided between, and controlled 

by, the mover and the manager of the bill, except 

that in the event the manager of the bill is in favor 

of any such amendment, motion, or appeal, the time 

in opposition thereto shall be controlled by the minority 

leader or such leader’s designee. 

‘‘(iii) FINAL DISPOSITION.—After 10 hours of consideration, the Senate shall proceed, without any further 

debate on any question, to vote on the final disposition 

thereof to the exclusion of all motions not then pending 

before the Senate at that time or necessary to resolve 

the differences between the Houses and to the exclusion of all other motions, except a motion to table, 

or to reconsider and one quorum call on demand to 

establish the presence of a quorum (and motions 

required to establish a quorum) immediately before 

the final vote begins. 

‘‘(iv) LIMITATION.—Clauses (i) through (iii) shall 

only apply to a conference report, message or the 

amendments thereto if the conference report, message, 

or an amendment thereto— 

‘‘(I) is related only to the program under this 

title; and 

‘‘(II) satisfies the requirements of subparagraphs (A)(i) and (C) of subsection (c)(2). 

‘‘(F) VETO.—If the President vetoes the bill debate on 

a veto message in the Senate under this subsection shall 
H. R. 3590—381 

be 1 hour equally divided between the majority and 

minority leaders or their designees. 

‘‘(5) RULES OF THE SENATE AND HOUSE OF REPRESENTATIVES.—This subsection and subsection (f)(2) are enacted by 

Congress— 

‘‘(A) as an exercise of the rulemaking power of the 

Senate and the House of Representatives, respectively, and 

is deemed to be part of the rules of each House, respectively, but applicable only with respect to the procedure 

to be followed in that House in the case of bill under 

this section, and it supersedes other rules only to the 

extent that it is inconsistent with such rules; and 

‘‘(B) with full recognition of the constitutional right 

of either House to change the rules (so far as they relate 

to the procedure of that House) at any time, in the same 

manner, and to the same extent as in the case of any 

other rule of that House. 

‘‘(e) IMPLEMENTATION OF PROPOSAL.— 

‘‘(1) IN GENERAL.—Notwithstanding any other provision of 

law, the Secretary shall, except as provided in paragraph (3), 

implement the recommendations contained in a proposal submitted by the President to Congress pursuant to this section 

on August 15 of the year in which the proposal is so submitted. 

‘‘(2) APPLICATION.— 

‘‘(A) IN GENERAL.—A recommendation described in 

paragraph (1) shall apply as follows: 

‘‘(i) In the case of a recommendation that is a 

change in the payment rate for an item or service 

under Medicare in which payment rates change on 

a fiscal year basis (or a cost reporting period basis 

that relates to a fiscal year), on a calendar year basis 

(or a cost reporting period basis that relates to a calendar year), or on a rate year basis (or a cost reporting 

period basis that relates to a rate year), such recommendation shall apply to items and services furnished on the first day of the first fiscal year, calendar 

year, or rate year (as the case may be) that begins 

after such August 15. 

‘‘(ii) In the case of a recommendation relating to 

payments to plans under parts C and D, such recommendation shall apply to plan years beginning on 

the first day of the first calendar year that begins 

after such August 15. 

‘‘(iii) In the case of any other recommendation, 

such recommendation shall be addressed in the regular 

regulatory process timeframe and shall apply as soon 

as practicable. 

‘‘(B) INTERIM FINAL RULEMAKING.—The Secretary may 

use interim final rulemaking to implement any recommendation described in paragraph (1). 

‘‘(3) EXCEPTION.—The Secretary shall not be required to 

implement the recommendations contained in a proposal submitted in a proposal year by the President to Congress pursuant 

to this section if— 

‘‘(A) prior to August 15 of the proposal year, Federal 

legislation is enacted that includes the following provision: 

‘This Act supercedes the recommendations of the Board 
H. R. 3590—382 

contained in the proposal submitted, in the year which 

includes the date of enactment of this Act, to Congress 

under section 1899A of the Social Security Act.’; and 

‘‘(B) in the case of implementation year 2020 and subsequent implementation years, a joint resolution described 

in subsection (f)(1) is enacted not later than August 15, 

2017. 

‘‘(4) NO AFFECT ON AUTHORITY TO IMPLEMENT CERTAIN

PROVISIONS.—Nothing in paragraph (3) shall be construed to 

affect the authority of the Secretary to implement any recommendation contained in a proposal or advisory report under 

this section to the extent that the Secretary otherwise has 

the authority to implement such recommendation administratively. 

‘‘(5) LIMITATION ON REVIEW.—There shall be no administrative or judicial review under section 1869, section 1878, or 

otherwise of the implementation by the Secretary under this 

subsection of the recommendations contained in a proposal. 

‘‘(f) JOINT RESOLUTION REQUIRED TO DISCONTINUE THE

BOARD.— 

‘‘(1) IN GENERAL.—For purposes of subsection (e)(3)(B), a 

joint resolution described in this paragraph means only a joint 

resolution— 

‘‘(A) that is introduced in 2017 by not later than February 1 of such year; 

‘‘(B) which does not have a preamble; 

‘‘(C) the title of which is as follows: ‘Joint resolution 

approving the discontinuation of the process for consideration and automatic implementation of the annual proposal 

of the Independent Medicare Advisory Board under section 

1899A of the Social Security Act’; and 

‘‘(D) the matter after the resolving clause of which 

is as follows: ‘That Congress approves the discontinuation 

of the process for consideration and automatic implementation of the annual proposal of the Independent Medicare 

Advisory Board under section 1899A of the Social Security 

Act.’. 

‘‘(2) PROCEDURE.— ‘‘(A) REFERRAL.—A joint resolution described in paragraph (1) shall be referred to the Committee on Ways 

and Means and the Committee on Energy and Commerce 

of the House of Representatives and the Committee on 

Finance of the Senate. 

‘‘(B) DISCHARGE.—In the Senate, if the committee to 

which is referred a joint resolution described in paragraph 

(1) has not reported such joint resolution (or an identical 

joint resolution) at the end of 20 days after the joint resolution described in paragraph (1) is introduced, such committee may be discharged from further consideration of 

such joint resolution upon a petition supported in writing 

by 30 Members of the Senate, and such joint resolution 

shall be placed on the calendar. 

‘‘(C) CONSIDERATION.— 

‘‘(i) IN GENERAL.—In the Senate, when the committee to which a joint resolution is referred has 

reported, or when a committee is discharged (under 

subparagraph (C)) from further consideration of a joint 
H. R. 3590—383 

resolution described in paragraph (1), it is at any time 

thereafter in order (even though a previous motion 

to the same effect has been disagreed to) for a motion 

to proceed to the consideration of the joint resolution 

to be made, and all points of order against the joint 

resolution (and against consideration of the joint resolution) are waived, except for points of order under 

the Congressional Budget act of 1974 or under budget 

resolutions pursuant to that Act. The motion is not 

debatable. A motion to reconsider the vote by which 

the motion is agreed to or disagreed to shall not be 

in order. If a motion to proceed to the consideration 

of the joint resolution is agreed to, the joint resolution 

shall remain the unfinished business of the Senate 

until disposed of. 

‘‘(ii) DEBATE LIMITATION.—In the Senate, consideration of the joint resolution, and on all debatable 

motions and appeals in connection therewith, shall 

be limited to not more than 10 hours, which shall 

be divided equally between the majority leader and 

the minority leader, or their designees. A motion further to limit debate is in order and not debatable. 

An amendment to, or a motion to postpone, or a motion 

to proceed to the consideration of other business, or 

a motion to recommit the joint resolution is not in 

order. 

‘‘(iii) PASSAGE.—In the Senate, immediately following the conclusion of the debate on a joint resolution 

described in paragraph (1), and a single quorum call 

at the conclusion of the debate if requested in accordance with the rules of the Senate, the vote on passage 

of the joint resolution shall occur. 

‘‘(iv) APPEALS.—Appeals from the decisions of the 

Chair relating to the application of the rules of the 

Senate to the procedure relating to a joint resolution 

described in paragraph (1) shall be decided without 

debate. 

‘‘(D) OTHER HOUSE ACTS FIRST.—If, before the passage 

by 1 House of a joint resolution of that House described 

in paragraph (1), that House receives from the other House 

a joint resolution described in paragraph (1), then the 

following procedures shall apply: 

‘‘(i) The joint resolution of the other House shall 

not be referred to a committee. 

‘‘(ii) With respect to a joint resolution described 

in paragraph (1) of the House receiving the joint resolution— 

‘‘(I) the procedure in that House shall be the 

same as if no joint resolution had been received 

from the other House; but 

‘‘(II) the vote on final passage shall be on 

the joint resolution of the other House. 

‘‘(E) EXCLUDED DAYS.—For purposes of determining the 

period specified in subparagraph (B), there shall be 

excluded any days either House of Congress is adjourned 

for more than 3 days during a session of Congress. 
H. R. 3590—384 

‘‘(F) MAJORITY REQUIRED FOR ADOPTION.—A joint resolution considered under this subsection shall require an 

affirmative vote of three-fifths of the Members, duly chosen 

and sworn, for adoption. 

‘‘(3) TERMINATION.—If a joint resolution described in paragraph (1) is enacted not later than August 15, 2017— 

‘‘(A) the Chief Actuary of the Medicare & Medicaid 

Services shall not— 

‘‘(i) make any determinations under subsection 

(c)(6) after May 1, 2017; or 

‘‘(ii) provide any opinion pursuant to subsection 

(c)(3)(B)(iii) after January 16, 2018; 

‘‘(B) the Board shall not submit any proposals or 

advisory reports to Congress under this section after 

January 16, 2018; and 

‘‘(C) the Board and the consumer advisory council 

under subsection (k) shall terminate on August 16, 2018. 

‘‘(g) BOARD MEMBERSHIP; TERMS OF OFFICE; CHAIRPERSON; 

REMOVAL.— 

‘‘(1) MEMBERSHIP.— 

‘‘(A) IN GENERAL.—The Board shall be composed of— 

‘‘(i) 15 members appointed by the President, by 

and with the advice and consent of the Senate; and 

‘‘(ii) the Secretary, the Administrator of the Center 

for Medicare & Medicaid Services, and the Administrator of the Health Resources and Services Administration, all of whom shall serve ex officio as nonvoting 

members of the Board. 

‘‘(B) QUALIFICATIONS.— 

‘‘(i) IN GENERAL.—The appointed membership of 

the Board shall include individuals with national recognition for their expertise in health finance and 

economics, actuarial science, health facility management, health plans and integrated delivery systems, 

reimbursement of health facilities, allopathic and osteopathic physicians, and other providers of health services, and other related fields, who provide a mix of 

different professionals, broad geographic representation, and a balance between urban and rural representatives. 

‘‘(ii) INCLUSION.—The appointed membership of the 

Board shall include (but not be limited to) physicians 

and other health professionals, experts in the area 

of pharmaco-economics or prescription drug benefit programs, employers, third-party payers, individuals 

skilled in the conduct and interpretation of biomedical, 

health services, and health economics research and 

expertise in outcomes and effectiveness research and 

technology assessment. Such membership shall also 

include representatives of consumers and the elderly. 

‘‘(iii) MAJORITY NONPROVIDERS.—Individuals who 

are directly involved in the provision or management 

of the delivery of items and services covered under 

this title shall not constitute a majority of the 

appointed membership of the Board. 

‘‘(C) ETHICAL DISCLOSURE.—The President shall establish a system for public disclosure by appointed members 
H. R. 3590—385 

of the Board of financial and other potential conflicts of 

interest relating to such members. Appointed members of 

the Board shall be treated as officers in the executive 

branch for purposes of applying title I of the Ethics in 

Government Act of 1978 (Public Law 95–521). 

‘‘(D) CONFLICTS OF INTEREST.—No individual may serve 

as an appointed member if that individual engages in any 

other business, vocation, or employment. 

‘‘(E) CONSULTATION WITH CONGRESS.—In selecting 

individuals for nominations for appointments to the Board, 

the President shall consult with— 

‘‘(i) the majority leader of the Senate concerning 

the appointment of 3 members; 

‘‘(ii) the Speaker of the House of Representatives 

concerning the appointment of 3 members; 

‘‘(iii) the minority leader of the Senate concerning 

the appointment of 3 members; and 

‘‘(iv) the minority leader of the House of Representatives concerning the appointment of 3 members. 

‘‘(2) TERM OF OFFICE.—Each appointed member shall hold 

office for a term of 6 years except that— 

‘‘(A) a member may not serve more than 2 full consecutive terms (but may be reappointed to 2 full consecutive 

terms after being appointed to fill a vacancy on the Board); 

‘‘(B) a member appointed to fill a vacancy occurring 

prior to the expiration of the term for which that member’s 

predecessor was appointed shall be appointed for the 

remainder of such term; 

‘‘(C) a member may continue to serve after the expiration of the member’s term until a successor has taken 

office; and 

‘‘(D) of the members first appointed under this section, 

5 shall be appointed for a term of 1 year, 5 shall be 

appointed for a term of 3 years, and 5 shall be appointed 

for a term of 6 years, the term of each to be designated 

by the President at the time of nomination. 

‘‘(3) CHAIRPERSON.— 

‘‘(A) IN GENERAL.—The Chairperson shall be appointed 

by the President, by and with the advice and consent 

of the Senate, from among the members of the Board. 

‘‘(B) DUTIES.—The Chairperson shall be the principal 

executive officer of the Board, and shall exercise all of 

the executive and administrative functions of the Board, 

including functions of the Board with respect to— 

‘‘(i) the appointment and supervision of personnel 

employed by the Board; 

‘‘(ii) the distribution of business among personnel 

appointed and supervised by the Chairperson and 

among administrative units of the Board; and 

‘‘(iii) the use and expenditure of funds. 

‘‘(C) GOVERNANCE.—In carrying out any of the functions under subparagraph (B), the Chairperson shall be 

governed by the general policies established by the Board 

and by the decisions, findings, and determinations the 

Board shall by law be authorized to make. 
H. R. 3590—386 

‘‘(D) REQUESTS FOR APPROPRIATIONS.—Requests or estimates for regular, supplemental, or deficiency appropriations on behalf of the Board may not be submitted by 

the Chairperson without the prior approval of a majority 

vote of the Board. 

‘‘(4) REMOVAL.—Any appointed member may be removed 

by the President for neglect of duty or malfeasance in office, 

but for no other cause. 

‘‘(h) VACANCIES; QUORUM; SEAL; VICE CHAIRPERSON; VOTING

ON REPORTS.— ‘‘(1) VACANCIES.—No vacancy on the Board shall impair 

the right of the remaining members to exercise all the powers 

of the Board. 

‘‘(2) QUORUM.—A majority of the appointed members of 

the Board shall constitute a quorum for the transaction of 

business, but a lesser number of members may hold hearings. 

‘‘(3) SEAL.—The Board shall have an official seal, of which 

judicial notice shall be taken. 

‘‘(4) VICE CHAIRPERSON.—The Board shall annually elect 

a Vice Chairperson to act in the absence or disability of the 

Chairperson or in case of a vacancy in the office of the Chairperson. 

‘‘(5) VOTING ON PROPOSALS.—Any proposal of the Board 

must be approved by the majority of appointed members 

present. 

‘‘(i) POWERS OF THE BOARD.— 

‘‘(1) HEARINGS.—The Board may hold such hearings, sit 

and act at such times and places, take such testimony, and 

receive such evidence as the Board considers advisable to carry 

out this section. 

‘‘(2) AUTHORITY TO INFORM RESEARCH PRIORITIES FOR DATA

COLLECTION.—The Board may advise the Secretary on priorities 

for health services research, particularly as such priorities pertain to necessary changes and issues regarding payment 

reforms under Medicare. 

‘‘(3) OBTAINING OFFICIAL DATA.—The Board may secure 

directly from any department or agency of the United States 

information necessary to enable it to carry out this section. 

Upon request of the Chairperson, the head of that department 

or agency shall furnish that information to the Board on an 

agreed upon schedule. 

‘‘(4) POSTAL SERVICES.—The Board may use the United 

States mails in the same manner and under the same conditions 

as other departments and agencies of the Federal Government. 

‘‘(5) GIFTS.—The Board may accept, use, and dispose of 

gifts or donations of services or property. 

‘‘(6) OFFICES.—The Board shall maintain a principal office 

and such field offices as it determines necessary, and may 

meet and exercise any of its powers at any other place. 

‘‘(j) PERSONNEL MATTERS.— 

‘‘(1) COMPENSATION OF MEMBERS AND CHAIRPERSON.—Each 

appointed member, other than the Chairperson, shall be compensated at a rate equal to the annual rate of basic pay prescribed for level III of the Executive Schedule under section 

5315 of title 5, United States Code. The Chairperson shall 

be compensated at a rate equal to the daily equivalent of 

the annual rate of basic pay prescribed for level II of the 
H. R. 3590—387 

Executive Schedule under section 5315 of title 5, United States 

Code. 

‘‘(2) TRAVEL EXPENSES.—The appointed members shall be 

allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while 

away from their homes or regular places of business in the 

performance of services for the Board. 

‘‘(3) STAFF.— 

‘‘(A) IN GENERAL.—The Chairperson may, without 

regard to the civil service laws and regulations, appoint 

and terminate an executive director and such other additional personnel as may be necessary to enable the Board 

to perform its duties. The employment of an executive 

director shall be subject to confirmation by the Board. 

‘‘(B) COMPENSATION.—The Chairperson may fix the 

compensation of the executive director and other personnel 

without regard to chapter 51 and subchapter III of chapter 

53 of title 5, United States Code, relating to classification 

of positions and General Schedule pay rates, except that 

the rate of pay for the executive director and other personnel may not exceed the rate payable for level V of 

the Executive Schedule under section 5316 of such title. 

‘‘(4) DETAIL OF GOVERNMENT EMPLOYEES.—Any Federal 

Government employee may be detailed to the Board without 

reimbursement, and such detail shall be without interruption 

or loss of civil service status or privilege. 

‘‘(5) PROCUREMENT OF TEMPORARY AND INTERMITTENT SERVICES.—The Chairperson may procure temporary and intermittent services under section 3109(b) of title 5, United States 

Code, at rates for individuals which do not exceed the daily 

equivalent of the annual rate of basic pay prescribed for level 

V of the Executive Schedule under section 5316 of such title. 

‘‘(k) CONSUMER ADVISORY COUNCIL.— ‘‘(1) IN GENERAL.—There is established a consumer advisory 

council to advise the Board on the impact of payment policies 

under this title on consumers. 

‘‘(2) MEMBERSHIP.— ‘‘(A) NUMBER AND APPOINTMENT.—The consumer 

advisory council shall be composed of 10 consumer representatives appointed by the Comptroller General of the 

United States, 1 from among each of the 10 regions established by the Secretary as of the date of enactment of 

this section. 

‘‘(B) QUALIFICATIONS.—The membership of the council 

shall represent the interests of consumers and particular 

communities. 

‘‘(3) DUTIES.—The consumer advisory council shall, subject 

to the call of the Board, meet not less frequently than 2 times 

each year in the District of Columbia. 

‘‘(4) OPEN MEETINGS.—Meetings of the consumer advisory 

council shall be open to the public. 

‘‘(5) ELECTION OF OFFICERS.—Members of the consumer 

advisory council shall elect their own officers. 

‘‘(6) APPLICATION OF FACA.—The Federal Advisory Committee Act (5 U.S.C. App.) shall apply to the consumer advisory 

council except that section 14 of such Act shall not apply. 
H. R. 3590—388 

‘‘(l) DEFINITIONS.—In this section: 

‘‘(1) BOARD; CHAIRPERSON; MEMBER.—The terms ‘Board’, 

‘Chairperson’, and ‘Member’ mean the Independent Medicare 

Advisory Board established under subsection (a) and the Chairperson and any Member thereof, respectively. 

‘‘(2) MEDICARE.—The term ‘Medicare’ means the program 

established under this title, including parts A, B, C, and D. 

‘‘(3) MEDICARE BENEFICIARY.—The term ‘Medicare beneficiary’ means an individual who is entitled to, or enrolled 

for, benefits under part A or enrolled for benefits under part 

B. 

‘‘(4) MEDICARE PROGRAM SPENDING.—The term ‘Medicare 

program spending’ means program spending under parts A, 

B, and D net of premiums. 

‘‘(m) FUNDING.— 

‘‘(1) IN GENERAL.—There are appropriated to the Board 

to carry out its duties and functions— 

‘‘(A) for fiscal year 2012, $15,000,000; and 

‘‘(B) for each subsequent fiscal year, the amount appropriated under this paragraph for the previous fiscal year 

increased by the annual percentage increase in the Consumer Price Index for All Urban Consumers (all items; 

United States city average) as of June of the previous 

fiscal year. 

‘‘(2) FROM TRUST FUNDS.—Sixty percent of amounts appropriated under paragraph (1) shall be derived by transfer from 

the Federal Hospital Insurance Trust Fund under section 1817 

and 40 percent of amounts appropriated under such paragraph 

shall be derived by transfer from the Federal Supplementary 

Medical Insurance Trust Fund under section 1841.’’. 

(2) LOBBYING COOLING-OFF PERIOD FOR MEMBERS OF THE

INDEPENDENT MEDICARE ADVISORY BOARD.—Section 207(c) of 

title 18, United States Code, is amended by inserting at the 

end the following: 

‘‘(3) MEMBERS OF THE INDEPENDENT MEDICARE ADVISORY

BOARD.— ‘‘(A) IN GENERAL.—Paragraph (1) shall apply to a 

member of the Independent Medicare Advisory Board under 

section 1899A. 

‘‘(B) AGENCIES AND CONGRESS.—For purposes of paragraph (1), the agency in which the individual described 

in subparagraph (A) served shall be considered to be the 

Independent Medicare Advisory Board, the Department of 

Health and Human Services, and the relevant committees 

of jurisdiction of Congress, including the Committee on 

Ways and Means and the Committee on Energy and Commerce of the House of Representatives and the Committee 

on Finance of the Senate.’’. 

(b) GAO STUDY AND REPORT ON DETERMINATION AND

IMPLEMENTATION OF PAYMENT AND COVERAGE POLICIES UNDER THE

MEDICARE PROGRAM.— (1) INITIAL STUDY AND REPORT.— (A) STUDY.—The Comptroller General of the United 

States (in this section referred to as the ‘‘Comptroller General’’) shall conduct a study on changes to payment policies, 

methodologies, and rates and coverage policies and methodologies under the Medicare program under title XVIII 
H. R. 3590—389 

of the Social Security Act as a result of the recommendations contained in the proposals made by the Independent 

Medicare Advisory Board under section 1899A of such Act 

(as added by subsection (a)), including an analysis of the 

effect of such recommendations on— 

(i) Medicare beneficiary access to providers and 

items and services; 

(ii) the affordability of Medicare premiums and 

cost-sharing (including deductibles, coinsurance, and 

copayments); 

(iii) the potential impact of changes on other 

government or private-sector purchasers and payers 

of care; and 

(iv) quality of patient care, including patient 

experience, outcomes, and other measures of care. 

(B) REPORT.—Not later than July 1, 2015, the Comptroller General shall submit to Congress a report containing 

the results of the study conducted under subparagraph 

(A), together with recommendations for such legislation 

and administrative action as the Comptroller General 

determines appropriate. 

(2) SUBSEQUENT STUDIES AND REPORTS.—The Comptroller 

General shall periodically conduct such additional studies and 

submit reports to Congress on changes to Medicare payments 

policies, methodologies, and rates and coverage policies and 

methodologies as the Comptroller General determines appropriate, in consultation with the Committee on Ways and Means 

and the Committee on Energy and Commerce of the House 

of Representatives and the Committee on Finance of the Senate. 

(c) CONFORMING AMENDMENTS.—Section 1805(b) of the Social 

Security Act (42 U.S.C. 1395b–6(b)) is amended— 

(1) by redesignating paragraphs (4) through (8) as paragraphs (5) through (9), respectively; and 

(2) by inserting after paragraph (3) the following: 

‘‘(4) REVIEW AND COMMENT ON THE INDEPENDENT MEDICARE

ADVISORY BOARD OR SECRETARIAL PROPOSAL.—If the Independent Medicare Advisory Board (as established under subsection (a) of section 1899A) or the Secretary submits a proposal 

to the Commission under such section in a year, the Commission shall review the proposal and, not later than March 1 

of that year, submit to the Committee on Ways and Means 

and the Committee on Energy and Commerce of the House 

of Representatives and the Committee on Finance of the Senate 

written comments on such proposal. Such comments may 

include such recommendations as the Commission deems appropriate.’’. 

Subtitle F—Health Care Quality 

Improvements 

SEC. 3501. HEALTH CARE DELIVERY SYSTEM RESEARCH; QUALITY 

IMPROVEMENT TECHNICAL ASSISTANCE. 

Part D of title IX of the Public Health Service Act, as amended 

by section 3013, is further amended by adding at the end the 

following: 
H. R. 3590—390 

‘‘Subpart II—Health Care Quality Improvement 

Programs 

‘‘SEC. 933. HEALTH CARE DELIVERY SYSTEM RESEARCH. 

‘‘(a) PURPOSE.—The purposes of this section are to— 

‘‘(1) enable the Director to identify, develop, evaluate, 

disseminate, and provide training in innovative methodologies 

and strategies for quality improvement practices in the delivery 

of health care services that represent best practices (referred 

to as ‘best practices’) in health care quality, safety, and value; 

and 

‘‘(2) ensure that the Director is accountable for implementing a model to pursue such research in a collaborative 

manner with other related Federal agencies. 

‘‘(b) GENERAL FUNCTIONS OF THE CENTER.—The Center for 

Quality Improvement and Patient Safety of the Agency for 

Healthcare Research and Quality (referred to in this section as 

the ‘Center’), or any other relevant agency or department designated 

by the Director, shall— 

‘‘(1) carry out its functions using research from a variety 

of disciplines, which may include epidemiology, health services, 

sociology, psychology, human factors engineering, biostatistics, 

health economics, clinical research, and health informatics; 

‘‘(2) conduct or support activities consistent with the purposes described in subsection (a), and for— 

‘‘(A) best practices for quality improvement practices 

in the delivery of health care services; and 

‘‘(B) that include changes in processes of care and 

the redesign of systems used by providers that will reliably 

result in intended health outcomes, improve patient safety, 

and reduce medical errors (such as skill development for 

health care providers in team-based health care delivery 

and rapid cycle process improvement) and facilitate adoption of improved workflow; 

‘‘(3) identify health care providers, including health care 

systems, single institutions, and individual providers, that— 

‘‘(A) deliver consistently high-quality, efficient health 

care services (as determined by the Secretary); and 

‘‘(B) employ best practices that are adaptable and scalable to diverse health care settings or effective in improving 

care across diverse settings; 

‘‘(4) assess research, evidence, and knowledge about what 

strategies and methodologies are most effective in improving 

health care delivery; 

‘‘(5) find ways to translate such information rapidly and 

effectively into practice, and document the sustainability of 

those improvements; 

‘‘(6) create strategies for quality improvement through the 

development of tools, methodologies, and interventions that 

can successfully reduce variations in the delivery of health 

care; 

‘‘(7) identify, measure, and improve organizational, human, 

or other causative factors, including those related to the culture 

and system design of a health care organization, that contribute 

to the success and sustainability of specific quality improvement 

and patient safety strategies; 
H. R. 3590—391 

‘‘(8) provide for the development of best practices in the 

delivery of health care services that— 

‘‘(A) have a high likelihood of success, based on structured review of empirical evidence; 

‘‘(B) are specified with sufficient detail of the individual 

processes, steps, training, skills, and knowledge required 

for implementation and incorporation into workflow of 

health care practitioners in a variety of settings; 

‘‘(C) are designed to be readily adapted by health care 

providers in a variety of settings; and 

‘‘(D) where applicable, assist health care providers in 

working with other health care providers across the continuum of care and in engaging patients and their families 

in improving the care and patient health outcomes; 

‘‘(9) provide for the funding of the activities of organizations 

with recognized expertise and excellence in improving the 

delivery of health care services, including children’s health 

care, by involving multiple disciplines, managers of health care 

entities, broad development and training, patients, caregivers 

and families, and frontline health care workers, including activities for the examination of strategies to share best quality 

improvement practices and to promote excellence in the delivery 

of health care services; and 

‘‘(10) build capacity at the State and community level to 

lead quality and safety efforts through education, training, 

and mentoring programs to carry out the activities under paragraphs (1) through (9). 

‘‘(c) RESEARCH FUNCTIONS OF CENTER.— ‘‘(1) IN GENERAL.—The Center shall support, such as 

through a contract or other mechanism, research on health 

care delivery system improvement and the development of tools 

to facilitate adoption of best practices that improve the quality, 

safety, and efficiency of health care delivery services. Such 

support may include establishing a Quality Improvement Network Research Program for the purpose of testing, scaling, 

and disseminating of interventions to improve quality and efficiency in health care. Recipients of funding under the Program 

may include national, State, multi-State, or multi-site quality 

improvement networks. 

‘‘(2) RESEARCH REQUIREMENTS.—The research conducted 

pursuant to paragraph (1) shall— 

‘‘(A) address the priorities identified by the Secretary 

in the national strategic plan established under section 

399HH; 

‘‘(B) identify areas in which evidence is insufficient 

to identify strategies and methodologies, taking into consideration areas of insufficient evidence identified by the 

entity with a contract under section 1890(a) of the Social 

Security Act in the report required under section 399JJ; 

‘‘(C) address concerns identified by health care institutions and providers and communicated through the Center 

pursuant to subsection (d); 

‘‘(D) reduce preventable morbidity, mortality, and associated costs of morbidity and mortality by building capacity 

for patient safety research; 

‘‘(E) support the discovery of processes for the reliable, 

safe, efficient, and responsive delivery of health care, taking 
H. R. 3590—392 

into account discoveries from clinical research and 

comparative effectiveness research; 

‘‘(F) allow communication of research findings and 

translate evidence into practice recommendations that are 

adaptable to a variety of settings, and which, as soon 

as practicable after the establishment of the Center, shall 

include— 

‘‘(i) the implementation of a national application 

of Intensive Care Unit improvement projects relating 

to the adult (including geriatric), pediatric, and neonatal patient populations; 

‘‘(ii) practical methods for addressing health care 

associated infections, including Methicillin-Resistant 

Staphylococcus Aureus and Vancomycin-Resistant 

Entercoccus infections and other emerging infections; 

and 

‘‘(iii) practical methods for reducing preventable 

hospital admissions and readmissions; 

‘‘(G) expand demonstration projects for improving the 

quality of children’s health care and the use of health 

information technology, such as through Pediatric Quality 

Improvement Collaboratives and Learning Networks, consistent with provisions of section 1139A of the Social Security Act for assessing and improving quality, where 

applicable; 

‘‘(H) identify and mitigate hazards by— 

‘‘(i) analyzing events reported to patient safety 

reporting systems and patient safety organizations; 

and 

‘‘(ii) using the results of such analyses to develop 

scientific methods of response to such events; 

‘‘(I) include the conduct of systematic reviews of 

existing practices that improve the quality, safety, and 

efficiency of health care delivery, as well as new research 

on improving such practices; and 

‘‘(J) include the examination of how to measure and 

evaluate the progress of quality and patient safety activities. 

‘‘(d) DISSEMINATION OF RESEARCH FINDINGS.— 

‘‘(1) PUBLIC AVAILABILITY.—The Director shall make the 

research findings of the Center available to the public through 

multiple media and appropriate formats to reflect the varying 

needs of health care providers and consumers and diverse levels 

of health literacy. 

‘‘(2) LINKAGE TO HEALTH INFORMATION TECHNOLOGY.—The 

Secretary shall ensure that research findings and results generated by the Center are shared with the Office of the National 

Coordinator of Health Information Technology and used to 

inform the activities of the health information technology extension program under section 3012, as well as any relevant standards, certification criteria, or implementation specifications. 

‘‘(e) PRIORITIZATION.—The Director shall identify and regularly 

update a list of processes or systems on which to focus research 

and dissemination activities of the Center, taking into account— 

‘‘(1) the cost to Federal health programs; 

‘‘(2) consumer assessment of health care experience; 
H. R. 3590—393 

‘‘(3) provider assessment of such processes or systems and 

opportunities to minimize distress and injury to the health 

care workforce; 

‘‘(4) the potential impact of such processes or systems on 

health status and function of patients, including vulnerable 

populations including children; 

‘‘(5) the areas of insufficient evidence identified under subsection (c)(2)(B); and 

‘‘(6) the evolution of meaningful use of health information 

technology, as defined in section 3000. 

‘‘(f) COORDINATION.—The Center shall coordinate its activities 

with activities conducted by the Center for Medicare and Medicaid 

Innovation established under section 1115A of the Social Security 

Act. 

‘‘(g) FUNDING.—There is authorized to be appropriated to carry 

out this section $20,000,000 for fiscal years 2010 through 2014. 

‘‘SEC. 934. QUALITY IMPROVEMENT TECHNICAL ASSISTANCE AND 

IMPLEMENTATION. 

‘‘(a) IN GENERAL.—The Director, through the Center for Quality 

Improvement and Patient Safety of the Agency for Healthcare 

Research and Quality (referred to in this section as the ‘Center’), 

shall award— 

‘‘(1) technical assistance grants or contracts to eligible entities to provide technical support to institutions that deliver 

health care and health care providers (including rural and 

urban providers of services and suppliers with limited infrastructure and financial resources to implement and support 

quality improvement activities, providers of services and suppliers with poor performance scores, and providers of services 

and suppliers for which there are disparities in care among 

subgroups of patients) so that such institutions and providers 

understand, adapt, and implement the models and practices 

identified in the research conducted by the Center, including 

the Quality Improvement Networks Research Program; and 

‘‘(2) implementation grants or contracts to eligible entities 

to implement the models and practices described under paragraph (1). 

‘‘(b) ELIGIBLE ENTITIES.— 

‘‘(1) TECHNICAL ASSISTANCE AWARD.—To be eligible to 

receive a technical assistance grant or contract under subsection 

(a)(1), an entity— 

‘‘(A) may be a health care provider, health care provider 

association, professional society, health care worker 

organization, Indian health organization, quality improvement organization, patient safety organization, local quality 

improvement collaborative, the Joint Commission, academic health center, university, physician-based research 

network, primary care extension program established under 

section 399W, a Federal Indian Health Service program 

or a health program operated by an Indian tribe (as defined 

in section 4 of the Indian Health Care Improvement Act), 

or any other entity identified by the Secretary; and 

‘‘(B) shall have demonstrated expertise in providing 

information and technical support and assistance to health 

care providers regarding quality improvement. 
H. R. 3590—394 

‘‘(2) IMPLEMENTATION AWARD.—To be eligible to receive an 

implementation grant or contract under subsection (a)(2), an 

entity— 

‘‘(A) may be a hospital or other health care provider 

or consortium or providers, as determined by the Secretary; 

and 

‘‘(B) shall have demonstrated expertise in providing 

information and technical support and assistance to health 

care providers regarding quality improvement. 

‘‘(c) APPLICATION.— ‘‘(1) TECHNICAL ASSISTANCE AWARD.—To receive a technical 

assistance grant or contract under subsection (a)(1), an eligible 

entity shall submit an application to the Secretary at such 

time, in such manner, and containing— 

‘‘(A) a plan for a sustainable business model that may 

include a system of— 

‘‘(i) charging fees to institutions and providers that 

receive technical support from the entity; and 

‘‘(ii) reducing or eliminating such fees for such 

institutions and providers that serve low-income populations; and 

‘‘(B) such other information as the Director may 

require. 

‘‘(2) IMPLEMENTATION AWARD.—To receive a grant or contract under subsection (a)(2), an eligible entity shall submit 

an application to the Secretary at such time, in such manner, 

and containing— 

‘‘(A) a plan for implementation of a model or practice 

identified in the research conducted by the Center 

including— 

‘‘(i) financial cost, staffing requirements, and 

timeline for implementation; and 

‘‘(ii) pre- and projected post-implementation quality 

measure performance data in targeted improvement 

areas identified by the Secretary; and 

‘‘(B) such other information as the Director may 

require. 

‘‘(d) MATCHING FUNDS.—The Director may not award a grant 

or contract under this section to an entity unless the entity agrees 

that it will make available (directly or through contributions from 

other public or private entities) non-Federal contributions toward 

the activities to be carried out under the grant or contract in 

an amount equal to $1 for each $5 of Federal funds provided 

under the grant or contract. Such non-Federal matching funds 

may be provided directly or through donations from public or private 

entities and may be in cash or in-kind, fairly evaluated, including 

plant, equipment, or services. 

‘‘(e) EVALUATION.— ‘‘(1) IN GENERAL.—The Director shall evaluate the performance of each entity that receives a grant or contract under 

this section. The evaluation of an entity shall include a study 

of— 

‘‘(A) the success of such entity in achieving the 

implementation, by the health care institutions and providers assisted by such entity, of the models and practices 

identified in the research conducted by the Center under 

section 933; 
H. R. 3590—395 

‘‘(B) the perception of the health care institutions and 

providers assisted by such entity regarding the value of 

the entity; and 

‘‘(C) where practicable, better patient health outcomes 

and lower cost resulting from the assistance provided by 

such entity. 

‘‘(2) EFFECT OF EVALUATION.—Based on the outcome of 

the evaluation of the entity under paragraph (1), the Director 

shall determine whether to renew a grant or contract with 

such entity under this section. 

‘‘(f) COORDINATION.—The entities that receive a grant or contract under this section shall coordinate with health information 

technology regional extension centers under section 3012(c) and 

the primary care extension program established under section 399W 

regarding the dissemination of quality improvement, system 

delivery reform, and best practices information.’’. 

SEC. 3502. ESTABLISHING COMMUNITY HEALTH TEAMS TO SUPPORT 

THE PATIENT-CENTERED MEDICAL HOME. 

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

(referred to in this section as the ‘‘Secretary’’) shall establish a 

program to provide grants to or enter into contracts with eligible 

entities to establish community-based interdisciplinary, interprofessional teams (referred to in this section as ‘‘health teams’’) to 

support primary care practices, including obstetrics and gynecology 

practices, within the hospital service areas served by the eligible 

entities. Grants or contracts shall be used to— 

(1) establish health teams to provide support services to 

primary care providers; and 

(2) provide capitated payments to primary care providers 

as determined by the Secretary. 

(b) ELIGIBLE ENTITIES.—To be eligible to receive a grant or 

contract under subsection (a), an entity shall— 

(1)(A) be a State or State-designated entity; or 

(B) be an Indian tribe or tribal organization, as defined 

in section 4 of the Indian Health Care Improvement Act; 

(2) submit a plan for achieving long-term financial sustainability within 3 years; 

(3) submit a plan for incorporating prevention initiatives 

and patient education and care management resources into 

the delivery of health care that is integrated with communitybased prevention and treatment resources, where available; 

(4) ensure that the health team established by the entity 

includes an interdisciplinary, interprofessional team of health 

care providers, as determined by the Secretary; such team 

may include medical specialists, nurses, pharmacists, nutritionists, dieticians, social workers, behavioral and mental health 

providers (including substance use disorder prevention and 

treatment providers), doctors of chiropractic, licensed complementary and alternative medicine practitioners, and physicians’ assistants; 

(5) agree to provide services to eligible individuals with 

chronic conditions, as described in section 1945 of the Social 

Security Act (as added by section 2703), in accordance with 

the payment methodology established under subsection (c) of 

such section; and 
H. R. 3590—396 

(6) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require. 

(c) REQUIREMENTS FOR HEALTH TEAMS.—A health team established pursuant to a grant or contract under subsection (a) shall— 

(1) establish contractual agreements with primary care providers to provide support services; 

(2) support patient-centered medical homes, defined as a 

mode of care that includes— 

(A) personal physicians; 

(B) whole person orientation; 

(C) coordinated and integrated care; 

(D) safe and high-quality care through evidenceinformed medicine, appropriate use of health information 

technology, and continuous quality improvements; 

(E) expanded access to care; and 

(F) payment that recognizes added value from additional components of patient-centered care; 

(3) collaborate with local primary care providers and 

existing State and community based resources to coordinate 

disease prevention, chronic disease management, transitioning 

between health care providers and settings and case management for patients, including children, with priority given to 

those amenable to prevention and with chronic diseases or 

conditions identified by the Secretary; 

(4) in collaboration with local health care providers, develop 

and implement interdisciplinary, interprofessional care plans 

that integrate clinical and community preventive and health 

promotion services for patients, including children, with a priority given to those amenable to prevention and with chronic 

diseases or conditions identified by the Secretary; 

(5) incorporate health care providers, patients, caregivers, 

and authorized representatives in program design and oversight; 

(6) provide support necessary for local primary care providers to— 

(A) coordinate and provide access to high-quality health 

care services; 

(B) coordinate and provide access to preventive and 

health promotion services; 

(C) provide access to appropriate specialty care and 

inpatient services; 

(D) provide quality-driven, cost-effective, culturally 

appropriate, and patient- and family-centered health care; 

(E) provide access to pharmacist-delivered medication 

management services, including medication reconciliation; 

(F) provide coordination of the appropriate use of complementary and alternative (CAM) services to those who 

request such services; 

(G) promote effective strategies for treatment planning, 

monitoring health outcomes and resource use, sharing 

information, treatment decision support, and organizing 

care to avoid duplication of service and other medical 

management approaches intended to improve quality and 

value of health care services; 

(H) provide local access to the continuum of health 

care services in the most appropriate setting, including 
H. R. 3590—397 

access to individuals that implement the care plans of 

patients and coordinate care, such as integrative health 

care practitioners; 

(I) collect and report data that permits evaluation of 

the success of the collaborative effort on patient outcomes, 

including collection of data on patient experience of care, 

and identification of areas for improvement; and 

(J) establish a coordinated system of early identification and referral for children at risk for developmental 

or behavioral problems such as through the use of infolines, 

health information technology, or other means as determined by the Secretary; 

(7) provide 24-hour care management and support during 

transitions in care settings including— 

(A) a transitional care program that provides onsite 

visits from the care coordinator, assists with the development of discharge plans and medication reconciliation upon 

admission to and discharge from the hospitals, nursing 

home, or other institution setting; 

(B) discharge planning and counseling support to providers, patients, caregivers, and authorized representatives; 

(C) assuring that post-discharge care plans include 

medication management, as appropriate; 

(D) referrals for mental and behavioral health services, 

which may include the use of infolines; and 

(E) transitional health care needs from adolescence 

to adulthood; 

(8) serve as a liaison to community prevention and treatment programs; 

(9) demonstrate a capacity to implement and maintain 

health information technology that meets the requirements of 

certified EHR technology (as defined in section 3000 of the 

Public Health Service Act (42 U.S.C. 300jj)) to facilitate 

coordination among members of the applicable care team and 

affiliated primary care practices; and 

(10) where applicable, report to the Secretary information 

on quality measures used under section 399JJ of the Public 

Health Service Act. 

(d) REQUIREMENT FOR PRIMARY CARE PROVIDERS.—A provider 

who contracts with a care team shall— 

(1) provide a care plan to the care team for each patient 

participant; 

(2) provide access to participant health records; and 

(3) meet regularly with the care team to ensure integration 

of care. 

(e) REPORTING TO SECRETARY.—An entity that receives a grant 

or contract under subsection (a) shall submit to the Secretary a 

report that describes and evaluates, as requested by the Secretary, 

the activities carried out by the entity under subsection (c). 

(f) DEFINITION OF PRIMARY CARE.—In this section, the term 

‘‘primary care’’ means the provision of integrated, accessible health 

care services by clinicians who are accountable for addressing a 

large majority of personal health care needs, developing a sustained 

partnership with patients, and practicing in the context of family 

and community. 
H. R. 3590—398 

SEC. 3503. MEDICATION MANAGEMENT SERVICES IN TREATMENT OF 

CHRONIC DISEASE. 

Title IX of the Public Health Service Act (42 U.S.C. 299 et 

seq.), as amended by section 3501, is further amended by inserting 

after section 934 the following: 

‘‘SEC. 935. GRANTS OR CONTRACTS TO IMPLEMENT MEDICATION 

MANAGEMENT SERVICES IN TREATMENT OF CHRONIC 

DISEASES. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Patient 

Safety Research Center established in section 933 (referred to in 

this section as the ‘Center’), shall establish a program to provide 

grants or contracts to eligible entities to implement medication 

management (referred to in this section as ‘MTM’) services provided 

by licensed pharmacists, as a collaborative, multidisciplinary, interprofessional approach to the treatment of chronic diseases for targeted individuals, to improve the quality of care and reduce overall 

cost in the treatment of such diseases. The Secretary shall commence the program under this section not later than May 1, 2010. 

‘‘(b) ELIGIBLE ENTITIES.—To be eligible to receive a grant or 

contract under subsection (a), an entity shall— 

‘‘(1) provide a setting appropriate for MTM services, as 

recommended by the experts described in subsection (e); 

‘‘(2) submit to the Secretary a plan for achieving longterm financial sustainability; 

‘‘(3) where applicable, submit a plan for coordinating MTM 

services through local community health teams established in 

section 3502 of the Patient Protection and Affordable Care 

Act or in collaboration with primary care extension programs 

established in section 399W; 

‘‘(4) submit a plan for meeting the requirements under 

subsection (c); and 

‘‘(5) submit to the Secretary such other information as 

the Secretary may require. 

‘‘(c) MTM SERVICES TO TARGETED INDIVIDUALS.—The MTM 

services provided with the assistance of a grant or contract awarded 

under subsection (a) shall, as allowed by State law including 

applicable collaborative pharmacy practice agreements, include— 

‘‘(1) performing or obtaining necessary assessments of the 

health and functional status of each patient receiving such 

MTM services; 

‘‘(2) formulating a medication treatment plan according 

to therapeutic goals agreed upon by the prescriber and the 

patient or caregiver or authorized representative of the patient; 

‘‘(3) selecting, initiating, modifying, recommending changes 

to, or administering medication therapy; 

‘‘(4) monitoring, which may include access to, ordering, 

or performing laboratory assessments, and evaluating the 

response of the patient to therapy, including safety and 

effectiveness; 

‘‘(5) performing an initial comprehensive medication review 

to identify, resolve, and prevent medication-related problems, 

including adverse drug events, quarterly targeted medication 

reviews for ongoing monitoring, and additional followup interventions on a schedule developed collaboratively with the prescriber; 
H. R. 3590—399 

‘‘(6) documenting the care delivered and communicating 

essential information about such care, including a summary 

of the medication review, and the recommendations of the 

pharmacist to other appropriate health care providers of the 

patient in a timely fashion; 

‘‘(7) providing education and training designed to enhance 

the understanding and appropriate use of the medications by 

the patient, caregiver, and other authorized representative; 

‘‘(8) providing information, support services, and resources 

and strategies designed to enhance patient adherence with 

therapeutic regimens; 

‘‘(9) coordinating and integrating MTM services within the 

broader health care management services provided to the 

patient; and 

‘‘(10) such other patient care services allowed under pharmacist scopes of practice in use in other Federal programs 

that have implemented MTM services. 

‘‘(d) TARGETED INDIVIDUALS.—MTM services provided by 

licensed pharmacists under a grant or contract awarded under 

subsection (a) shall be offered to targeted individuals who— 

‘‘(1) take 4 or more prescribed medications (including overthe-counter medications and dietary supplements); 

‘‘(2) take any ‘high risk’ medications; 

‘‘(3) have 2 or more chronic diseases, as identified by the 

Secretary; or 

‘‘(4) have undergone a transition of care, or other factors, 

as determined by the Secretary, that are likely to create a 

high risk of medication-related problems. 

‘‘(e) CONSULTATION WITH EXPERTS.—In designing and implementing MTM services provided under grants or contracts awarded 

under subsection (a), the Secretary shall consult with Federal, 

State, private, public-private, and academic entities, pharmacy and 

pharmacist organizations, health care organizations, consumer 

advocates, chronic disease groups, and other stakeholders involved 

with the research, dissemination, and implementation of pharmacist-delivered MTM services, as the Secretary determines appropriate. The Secretary, in collaboration with this group, shall determine whether it is possible to incorporate rapid cycle process 

improvement concepts in use in other Federal programs that have 

implemented MTM services. 

‘‘(f) REPORTING TO THE SECRETARY.—An entity that receives 

a grant or contract under subsection (a) shall submit to the Secretary a report that describes and evaluates, as requested by the 

Secretary, the activities carried out under subsection (c), including 

quality measures endorsed by the entity with a contract under 

section 1890 of the Social Security Act, as determined by the Secretary. 

‘‘(g) EVALUATION AND REPORT.—The Secretary shall submit to 

the relevant committees of Congress a report which shall— 

‘‘(1) assess the clinical effectiveness of pharmacist-provided 

services under the MTM services program, as compared to 

usual care, including an evaluation of whether enrollees maintained better health with fewer hospitalizations and emergency 

room visits than similar patients not enrolled in the program; 

‘‘(2) assess changes in overall health care resource use 

by targeted individuals; 
H. R. 3590—400 

‘‘(3) assess patient and prescriber satisfaction with MTM 

services; 

‘‘(4) assess the impact of patient-cost sharing requirements 

on medication adherence and recommendations for modifications; 

‘‘(5) identify and evaluate other factors that may impact 

clinical and economic outcomes, including demographic 

characteristics, clinical characteristics, and health services use 

of the patient, as well as characteristics of the regimen, pharmacy benefit, and MTM services provided; and 

‘‘(6) evaluate the extent to which participating pharmacists 

who maintain a dispensing role have a conflict of interest 

in the provision of MTM services, and if such conflict is found, 

provide recommendations on how such a conflict might be 

appropriately addressed. 

‘‘(h) GRANTS OR CONTRACTS TO FUND DEVELOPMENT OF

PERFORMANCE MEASURES.—The Secretary may, through the quality 

measure development program under section 931 of the Public 

Health Service Act, award grants or contracts to eligible entities 

for the purpose of funding the development of performance measures 

that assess the use and effectiveness of medication therapy management services.’’. 

SEC. 3504. DESIGN AND IMPLEMENTATION OF REGIONALIZED SYSTEMS FOR EMERGENCY CARE. 

(a) IN GENERAL.—Title XII of the Public Health Service Act 

(42 U.S.C. 300d et seq.) is amended— 

(1) in section 1203— 

(A) in the section heading, by inserting ‘‘FOR TRAUMA

SYSTEMS’’ after ‘‘GRANTS’’; and 

(B) in subsection (a), by striking ‘‘Administrator of 

the Health Resources and Services Administration’’ and 

inserting ‘‘Assistant Secretary for Preparedness and 

Response’’; 

(2) by inserting after section 1203 the following: 

‘‘SEC. 1204. COMPETITIVE GRANTS FOR REGIONALIZED SYSTEMS FOR 

EMERGENCY CARE RESPONSE. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Assistant 

Secretary for Preparedness and Response, shall award not fewer 

than 4 multiyear contracts or competitive grants to eligible entities 

to support pilot projects that design, implement, and evaluate 

innovative models of regionalized, comprehensive, and accountable 

emergency care and trauma systems. 

‘‘(b) ELIGIBLE ENTITY; REGION.—In this section: 

‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means— 

‘‘(A) a State or a partnership of 1 or more States 

and 1 or more local governments; or 

‘‘(B) an Indian tribe (as defined in section 4 of the 

Indian Health Care Improvement Act) or a partnership 

of 1 or more Indian tribes. 

‘‘(2) REGION.—The term ‘region’ means an area within a 

State, an area that lies within multiple States, or a similar 

area (such as a multicounty area), as determined by the Secretary. 

‘‘(3) EMERGENCY SERVICES.—The term ‘emergency services’ 

includes acute, prehospital, and trauma care. 
H. R. 3590—401 

‘‘(c) PILOT PROJECTS.—The Secretary shall award a contract 

or grant under subsection (a) to an eligible entity that proposes 

a pilot project to design, implement, and evaluate an emergency 

medical and trauma system that— 

‘‘(1) coordinates with public health and safety services, 

emergency medical services, medical facilities, trauma centers, 

and other entities in a region to develop an approach to emergency medical and trauma system access throughout the region, 

including 9–1–1 Public Safety Answering Points and emergency 

medical dispatch; 

‘‘(2) includes a mechanism, such as a regional medical 

direction or transport communications system, that operates 

throughout the region to ensure that the patient is taken to 

the medically appropriate facility (whether an initial facility 

or a higher-level facility) in a timely fashion; 

‘‘(3) allows for the tracking of prehospital and hospital 

resources, including inpatient bed capacity, emergency department capacity, trauma center capacity, on-call specialist coverage, ambulance diversion status, and the coordination of such 

tracking with regional communications and hospital destination 

decisions; and 

‘‘(4) includes a consistent region-wide prehospital, hospital, 

and interfacility data management system that— 

‘‘(A) submits data to the National EMS Information 

System, the National Trauma Data Bank, and others; 

‘‘(B) reports data to appropriate Federal and State 

databanks and registries; and 

‘‘(C) contains information sufficient to evaluate key 

elements of prehospital care, hospital destination decisions, 

including initial hospital and interfacility decisions, and 

relevant health outcomes of hospital care. 

‘‘(d) APPLICATION.— 

‘‘(1) IN GENERAL.—An eligible entity that seeks a contract 

or grant described in subsection (a) shall submit to the Secretary an application at such time and in such manner as 

the Secretary may require. 

‘‘(2) APPLICATION INFORMATION.—Each application shall 

include— 

‘‘(A) an assurance from the eligible entity that the 

proposed system— 

‘‘(i) has been coordinated with the applicable State 

Office of Emergency Medical Services (or equivalent 

State office); 

‘‘(ii) includes consistent indirect and direct medical 

oversight of prehospital, hospital, and interfacility 

transport throughout the region; 

‘‘(iii) coordinates prehospital treatment and triage, 

hospital destination, and interfacility transport 

throughout the region; 

‘‘(iv) includes a categorization or designation 

system for special medical facilities throughout the 

region that is integrated with transport and destination 

protocols; 

‘‘(v) includes a regional medical direction, patient 

tracking, and resource allocation system that supports 

day-to-day emergency care and surge capacity and is 
H. R. 3590—402 

integrated with other components of the national and 

State emergency preparedness system; and 

‘‘(vi) addresses pediatric concerns related to 

integration, planning, preparedness, and coordination 

of emergency medical services for infants, children and 

adolescents; and 

‘‘(B) such other information as the Secretary may 

require. 

‘‘(e) REQUIREMENT OF MATCHING FUNDS.— 

‘‘(1) IN GENERAL.—The Secretary may not make a grant 

under this section unless the State (or consortia of States) 

involved agrees, with respect to the costs to be incurred by 

the State (or consortia) in carrying out the purpose for which 

such grant was made, to make available non-Federal contributions (in cash or in kind under paragraph (2)) toward such 

costs in an amount equal to not less than $1 for each $3 

of Federal funds provided in the grant. Such contributions 

may be made directly or through donations from public or 

private entities. 

‘‘(2) NON-FEDERAL CONTRIBUTIONS.—Non-Federal contributions required in paragraph (1) may be in cash or in kind, 

fairly evaluated, including equipment or services (and excluding 

indirect or overhead costs). 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. 

‘‘(f) PRIORITY.—The Secretary shall give priority for the award 

of the contracts or grants described in subsection (a) to any eligible 

entity that serves a population in a medically underserved area 

(as defined in section 330(b)(3)). 

‘‘(g) REPORT.—Not later than 90 days after the completion 

of a pilot project under subsection (a), the recipient of such contract 

or grant described in shall submit to the Secretary a report containing the results of an evaluation of the program, including an 

identification of— 

‘‘(1) the impact of the regional, accountable emergency care 

and trauma system on patient health outcomes for various 

critical care categories, such as trauma, stroke, cardiac emergencies, neurological emergencies, and pediatric emergencies; 

‘‘(2) the system characteristics that contribute to the 

effectiveness and efficiency of the program (or lack thereof); 

‘‘(3) methods of assuring the long-term financial sustainability of the emergency care and trauma system; 

‘‘(4) the State and local legislation necessary to implement 

and to maintain the system; 

‘‘(5) the barriers to developing regionalized, accountable 

emergency care and trauma systems, as well as the methods 

to overcome such barriers; and 

‘‘(6) recommendations on the utilization of available funding 

for future regionalization efforts. 

‘‘(h) DISSEMINATION OF FINDINGS.—The Secretary shall, as 

appropriate, disseminate to the public and to the appropriate 

Committees of the Congress, the information contained in a report 

made under subsection (g).’’; and 

(3) in section 1232— 

(A) in subsection (a), by striking ‘‘appropriated’’ and 

all that follows through the period at the end and inserting 
H. R. 3590—403 

‘‘appropriated $24,000,000 for each of fiscal years 2010 

through 2014.’’; and 

(B) by inserting after subsection (c) the following: 

‘‘(d) AUTHORITY.—For the purpose of carrying out parts A 

through C, beginning on the date of enactment of the Patient 

Protection and Affordable Care Act, the Secretary shall transfer 

authority in administering grants and related authorities under 

such parts from the Administrator of the Health Resources and 

Services Administration to the Assistant Secretary for Preparedness 

and Response.’’. 

(b) SUPPORT FOR EMERGENCY MEDICINE RESEARCH.—Part H 

of title IV of the Public Health Service Act (42 U.S.C. 289 et 

seq.) is amended by inserting after the section 498C the following: 

‘‘SEC. 498D. SUPPORT FOR EMERGENCY MEDICINE RESEARCH. 

‘‘(a) EMERGENCY MEDICAL RESEARCH.—The Secretary shall support Federal programs administered by the National Institutes 

of Health, the Agency for Healthcare Research and Quality, the 

Health Resources and Services Administration, the Centers for 

Disease Control and Prevention, and other agencies involved in 

improving the emergency care system to expand and accelerate 

research in emergency medical care systems and emergency medicine, including— 

‘‘(1) the basic science of emergency medicine; 

‘‘(2) the model of service delivery and the components of 

such models that contribute to enhanced patient health outcomes; 

‘‘(3) the translation of basic scientific research into 

improved practice; and 

‘‘(4) the development of timely and efficient delivery of 

health services. 

‘‘(b) PEDIATRIC EMERGENCY MEDICAL RESEARCH.—The Secretary shall support Federal programs administered by the National 

Institutes of Health, the Agency for Healthcare Research and 

Quality, the Health Resources and Services Administration, the 

Centers for Disease Control and Prevention, and other agencies 

to coordinate and expand research in pediatric emergency medical 

care systems and pediatric emergency medicine, including— 

‘‘(1) an examination of the gaps and opportunities in pediatric emergency care research and a strategy for the optimal 

organization and funding of such research; 

‘‘(2) the role of pediatric emergency services as an 

integrated component of the overall health system; 

‘‘(3) system-wide pediatric emergency care planning, 

preparedness, coordination, and funding; 

‘‘(4) pediatric training in professional education; and 

‘‘(5) research in pediatric emergency care, specifically on 

the efficacy, safety, and health outcomes of medications used 

for infants, children, and adolescents in emergency care settings 

in order to improve patient safety. 

‘‘(c) IMPACT RESEARCH.—The Secretary shall support research 

to determine the estimated economic impact of, and savings that 

result from, the implementation of coordinated emergency care systems. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as may 

be necessary for each of fiscal years 2010 through 2014.’’. 
H. R. 3590—404 

SEC. 3505. TRAUMA CARE CENTERS AND SERVICE AVAILABILITY. 

(a) TRAUMA CARE CENTERS.— 

(1) GRANTS FOR TRAUMA CARE CENTERS.—Section 1241 of 

the Public Health Service Act (42 U.S.C. 300d–41) is amended 

by striking subsections (a) and (b) and inserting the following: 

‘‘(a) IN GENERAL.—The Secretary shall establish 3 programs 

to award grants to qualified public, nonprofit Indian Health Service, 

Indian tribal, and urban Indian trauma centers— 

‘‘(1) to assist in defraying substantial uncompensated care 

costs; 

‘‘(2) to further the core missions of such trauma centers, 

including by addressing costs associated with patient stabilization and transfer, trauma education and outreach, coordination 

with local and regional trauma systems, essential personnel 

and other fixed costs, and expenses associated with employee 

and non-employee physician services; and 

‘‘(3) to provide emergency relief to ensure the continued 

and future availability of trauma services. 

‘‘(b) MINIMUM QUALIFICATIONS OF TRAUMA CENTERS.— 

‘‘(1) PARTICIPATION IN TRAUMA CARE SYSTEM OPERATING

UNDER CERTAIN PROFESSIONAL GUIDELINES.—Except as provided 

in paragraph (2), the Secretary may not award a grant to 

a trauma center under subsection (a) unless the trauma center 

is a participant in a trauma system that substantially complies 

with section 1213. 

‘‘(2) EXEMPTION.—Paragraph (1) shall not apply to trauma 

centers that are located in States with no existing trauma 

care system. 

‘‘(3) QUALIFICATION FOR SUBSTANTIAL UNCOMPENSATED

CARE COSTS.—The Secretary shall award substantial uncompensated care grants under subsection (a)(1) only to trauma centers 

meeting at least 1 of the criteria in 1 of the following 3 categories: 

‘‘(A) CATEGORY A.—The criteria for category A are as 

follows: 

‘‘(i) At least 40 percent of the visits in the emergency department of the hospital in which the trauma 

center is located were charity or self-pay patients. 

‘‘(ii) At least 50 percent of the visits in such emergency department were Medicaid (under title XIX of 

the Social Security Act (42 U.S.C. 1396 et seq.)) and 

charity and self-pay patients combined. 

‘‘(B) CATEGORY B.—The criteria for category B are as 

follows: 

‘‘(i) At least 35 percent of the visits in the emergency department were charity or self-pay patients. 

‘‘(ii) At least 50 percent of the visits in the emergency department were Medicaid and charity and selfpay patients combined. 

‘‘(C) CATEGORY C.—The criteria for category C are as 

follows: 

‘‘(i) At least 20 percent of the visits in the emergency department were charity or self-pay patients. 

‘‘(ii) At least 30 percent of the visits in the emergency department were Medicaid and charity and selfpay patients combined. 
H. R. 3590—405 

‘‘(4) TRAUMA CENTERS IN 1115 WAIVER STATES.—Notwithstanding paragraph (3), the Secretary may award a substantial 

uncompensated care grant to a trauma center under subsection 

(a)(1) if the trauma center qualifies for funds under a Low 

Income Pool or Safety Net Care Pool established through a 

waiver approved under section 1115 of the Social Security 

Act (42 U.S.C. 1315). 

‘‘(5) DESIGNATION.—The Secretary may not award a grant 

to a trauma center unless such trauma center is verified by 

the American College of Surgeons or designated by an equivalent State or local agency. 

‘‘(c) ADDITIONAL REQUIREMENTS.—The Secretary may not award 

a grant to a trauma center under subsection (a)(1) unless such 

trauma center— 

‘‘(1) submits to the Secretary a plan satisfactory to the 

Secretary that demonstrates a continued commitment to 

serving trauma patients regardless of their ability to pay; and 

‘‘(2) has policies in place to assist patients who cannot 

pay for part or all of the care they receive, including a sliding 

fee scale, and to ensure fair billing and collection practices.’’. 

(2) CONSIDERATIONS IN MAKING GRANTS.—Section 1242 of 

the Public Health Service Act (42 U.S.C. 300d–42) is amended 

by striking subsections (a) and (b) and inserting the following: 

‘‘(a) SUBSTANTIAL UNCOMPENSATED CARE AWARDS.— 

‘‘(1) IN GENERAL.—The Secretary shall establish an award 

basis for each eligible trauma center for grants under section 

1241(a)(1) according to the percentage described in paragraph 

(2), subject to the requirements of section 1241(b)(3). 

‘‘(2) PERCENTAGES.—The applicable percentages are as follows: 

‘‘(A) With respect to a category A trauma center, 100 

percent of the uncompensated care costs. 

‘‘(B) With respect to a category B trauma center, not 

more than 75 percent of the uncompensated care costs. 

‘‘(C) With respect to a category C trauma center, not 

more than 50 percent of the uncompensated care costs. 

‘‘(b) CORE MISSION AWARDS.— 

‘‘(1) IN GENERAL.—In awarding grants under section 

1241(a)(2), the Secretary shall— 

‘‘(A) reserve 25 percent of the amount allocated for 

core mission awards for Level III and Level IV trauma 

centers; and 

‘‘(B) reserve 25 percent of the amount allocated for 

core mission awards for large urban Level I and II trauma 

centers— 

‘‘(i) that have at least 1 graduate medical education 

fellowship in trauma or trauma related specialties for 

which demand is exceeding supply; 

‘‘(ii) for which— 

‘‘(I) annual uncompensated care costs exceed 

$10,000,000; or 

‘‘(II) at least 20 percent of emergency department visits are charity or self-pay or Medicaid 

patients; and 

‘‘(iii) that are not eligible for substantial 

uncompensated care awards under section 1241(a)(1). 
H. R. 3590—406 

‘‘(c) EMERGENCY AWARDS.—In awarding grants under section 

1241(a)(3), the Secretary shall— 

‘‘(1) give preference to any application submitted by a 

trauma center that provides trauma care in a geographic area 

in which the availability of trauma care has significantly 

decreased or will significantly decrease if the center is forced 

to close or downgrade service or growth in demand for trauma 

services exceeds capacity; and 

‘‘(2) reallocate any emergency awards funds not obligated 

due to insufficient, or a lack of qualified, applications to the 

significant uncompensated care award program.’’. 

(3) CERTAIN AGREEMENTS.—Section 1243 of the Public 

Health Service Act (42 U.S.C. 300d–43) is amended by striking 

subsections (a), (b), and (c) and inserting the following: 

‘‘(a) MAINTENANCE OF FINANCIAL SUPPORT.—The Secretary may 

require a trauma center receiving a grant under section 1241(a) 

to maintain access to trauma services at comparable levels to the 

prior year during the grant period. 

‘‘(b) TRAUMA CARE REGISTRY.—The Secretary may require the 

trauma center receiving a grant under section 1241(a) to provide 

data to a national and centralized registry of trauma cases, in 

accordance with guidelines developed by the American College of 

Surgeons, and as the Secretary may otherwise require.’’. 

(4) GENERAL PROVISIONS.—Section 1244 of the Public 

Health Service Act (42 U.S.C. 300d–44) is amended by striking 

subsections (a), (b), and (c) and inserting the following: 

‘‘(a) APPLICATION.—The Secretary may not award a grant to 

a trauma center under section 1241(a) unless such center submits 

an application for the grant to the Secretary and the application 

is in such form, is made in such manner, and contains such agreements, assurances, and information as the Secretary determines 

to be necessary to carry out this part. 

‘‘(b) LIMITATION ON DURATION OF SUPPORT.—The period during 

which a trauma center receives payments under a grant under 

section 1241(a)(3) shall be for 3 fiscal years, except that the Secretary may waive such requirement for a center and authorize 

such center to receive such payments for 1 additional fiscal year. 

‘‘(c) LIMITATION ON AMOUNT OF GRANT.—Notwithstanding section 1242(a), a grant under section 1241 may not be made in 

an amount exceeding $2,000,000 for each fiscal year. 

‘‘(d) ELIGIBILITY.—Except as provided in section 

1242(b)(1)(B)(iii), acquisition of, or eligibility for, a grant under 

section 1241(a) shall not preclude a trauma center from being 

eligible for other grants described in such section. 

‘‘(e) FUNDING DISTRIBUTION.—Of the total amount appropriated 

for a fiscal year under section 1245, 70 percent shall be used 

for substantial uncompensated care awards under section 

1241(a)(1), 20 percent shall be used for core mission awards under 

section 1241(a)(2), and 10 percent shall be used for emergency 

awards under section 1241(a)(3). 

‘‘(f) MINIMUM ALLOWANCE.—Notwithstanding subsection (e), if 

the amount appropriated for a fiscal year under section 1245 is 

less than $25,000,000, all available funding for such fiscal year 

shall be used for substantial uncompensated care awards under 

section 1241(a)(1). 

‘‘(g) SUBSTANTIAL UNCOMPENSATED CARE AWARD DISTRIBUTION

AND PROPORTIONAL SHARE.—Notwithstanding section 1242(a), of 
H. R. 3590—407 

the amount appropriated for substantial uncompensated care grants 

for a fiscal year, the Secretary shall— 

‘‘(1) make available— 

‘‘(A) 50 percent of such funds for category A trauma 

center grantees; 

‘‘(B) 35 percent of such funds for category B trauma 

center grantees; and 

‘‘(C) 15 percent of such funds for category C trauma 

center grantees; and 

‘‘(2) provide available funds within each category in a 

manner proportional to the award basis specified in section 

1242(a)(2) to each eligible trauma center. 

‘‘(h) REPORT.—Beginning 2 years after the date of enactment 

of the Patient Protection and Affordable Care Act, and every 2 

years thereafter, the Secretary shall biennially report to Congress 

regarding the status of the grants made under section 1241 and 

on the overall financial stability of trauma centers.’’. 

(5) AUTHORIZATION OF APPROPRIATIONS.—Section 1245 of 

the Public Health Service Act (42 U.S.C. 300d–45) is amended 

to read as follows: 

‘‘SEC. 1245. AUTHORIZATION OF APPROPRIATIONS. 

‘‘For the purpose of carrying out this part, there are authorized to be appropriated $100,000,000 for fiscal year 2009, and such 

sums as may be necessary for each of fiscal years 2010 through 

2015. Such authorization of appropriations is in addition to any 

other authorization of appropriations or amounts that are available 

for such purpose.’’. 

(6) DEFINITION.—Part D of title XII of the Public Health 

Service Act (42 U.S.C. 300d–41 et seq.) is amended by adding 

at the end the following: 

‘‘SEC. 1246. DEFINITION. 

‘‘In this part, the term ‘uncompensated care costs’ means 

unreimbursed costs from serving self-pay, charity, or Medicaid 

patients, without regard to payment under section 1923 of the 

Social Security Act, all of which are attributable to emergency 

care and trauma care, including costs related to subsequent 

inpatient admissions to the hospital.’’. 

(b) TRAUMA SERVICE AVAILABILITY.—Title XII of the Public 

Health Service Act (42 U.S.C. 300d et seq.) is amended by adding 

at the end the following: 

‘‘PART H—TRAUMA SERVICE AVAILABILITY 

‘‘SEC. 1281. GRANTS TO STATES. 

‘‘(a) ESTABLISHMENT.—To promote universal access to trauma 

care services provided by trauma centers and trauma-related physician specialties, the Secretary shall provide funding to States to 

enable such States to award grants to eligible entities for the 

purposes described in this section. 

‘‘(b) AWARDING OF GRANTS BY STATES.—Each State may award 

grants to eligible entities within the State for the purposes described 

in subparagraph (d). 

‘‘(c) ELIGIBILITY.— ‘‘(1) IN GENERAL.—To be eligible to receive a grant under 

subsection (b) an entity shall— 

‘‘(A) be— 
H. R. 3590—408 

‘‘(i) a public or nonprofit trauma center or consortium thereof that meets that requirements of paragraphs (1), (2), and (5) of section 1241(b); 

‘‘(ii) a safety net public or nonprofit trauma center 

that meets the requirements of paragraphs (1) through 

(5) of section 1241(b); or 

‘‘(iii) a hospital in an underserved area (as defined 

by the State) that seeks to establish new trauma services; and 

‘‘(B) submit to the State an application at such time, 

in such manner, and containing such information as the 

State may require. 

‘‘(2) LIMITATION.—A State shall use at least 40 percent 

of the amount available to the State under this part for a 

fiscal year to award grants to safety net trauma centers 

described in paragraph (1)(A)(ii). 

‘‘(d) USE OF FUNDS.—The recipient of a grant under subsection 

(b) shall carry out 1 or more of the following activities consistent 

with subsection (b): 

‘‘(1) Providing trauma centers with funding to support 

physician compensation in trauma-related physician specialties 

where shortages exist in the region involved, with priority 

provided to safety net trauma centers described in subsection 

(c)(1)(A)(ii). 

‘‘(2) Providing for individual safety net trauma center fiscal 

stability and costs related to having service that is available 

24 hours a day, 7 days a week, with priority provided to 

safety net trauma centers described in subsection (c)(1)(A)(ii) 

located in urban, border, and rural areas. 

‘‘(3) Reducing trauma center overcrowding at specific 

trauma centers related to throughput of trauma patients. 

‘‘(4) Establishing new trauma services in underserved areas 

as defined by the State. 

‘‘(5) Enhancing collaboration between trauma centers and 

other hospitals and emergency medical services personnel 

related to trauma service availability. 

‘‘(6) Making capital improvements to enhance access and 

expedite trauma care, including providing helipads and associated safety infrastructure. 

‘‘(7) Enhancing trauma surge capacity at specific trauma 

centers. 

‘‘(8) Ensuring expedient receipt of trauma patients transported by ground or air to the appropriate trauma center. 

‘‘(9) Enhancing interstate trauma center collaboration. 

‘‘(e) LIMITATION.— 

‘‘(1) IN GENERAL.—A State may use not more than 20 

percent of the amount available to the State under this part 

for a fiscal year for administrative costs associated with 

awarding grants and related costs. 

‘‘(2) MAINTENANCE OF EFFORT.—The Secretary may not provide funding to a State under this part unless the State agrees 

that such funds will be used to supplement and not supplant 

State funding otherwise available for the activities and costs 

described in this part. 

‘‘(f) DISTRIBUTION OF FUNDS.—The following shall apply with 

respect to grants provided in this part: 
H. R. 3590—409 

‘‘(1) LESS THAN $10,000,000.—If the amount of appropriations for this part in a fiscal year is less than $10,000,000, the 

Secretary shall divide such funding evenly among only those 

States that have 1 or more trauma centers eligible for funding 

under section 1241(b)(3)(A). 

‘‘(2) LESS THAN $20,000,000.—If the amount of appropriations in a fiscal year is less than $20,000,000, the Secretary shall 

divide such funding evenly among only those States that have 

1 or more trauma centers eligible for funding under subparagraphs (A) and (B) of section 1241(b)(3). 

‘‘(3) LESS THAN $30,000,000.—If the amount of appropriations for this part in a fiscal year is less than $30,000,000, the 

Secretary shall divide such funding evenly among only those 

States that have 1 or more trauma centers eligible for funding 

under section 1241(b)(3). 

‘‘(4) $30,000,000 OR MORE.—If the amount of appropriations for this part in a fiscal year is $30,000,000 or more, the Secretary shall divide such funding evenly among all States. 

‘‘SEC. 1282. AUTHORIZATION OF APPROPRIATIONS. 

‘‘For the purpose of carrying out this part, there is authorized 

to be appropriated $100,000,000 for each of fiscal years 2010 

through 2015.’’. 

SEC. 3506. PROGRAM TO FACILITATE SHARED DECISIONMAKING. 

Part D of title IX of the Public Health Service Act, as amended 

by section 3503, is further amended by adding at the end the 

following: 

‘‘SEC. 936. PROGRAM TO FACILITATE SHARED DECISIONMAKING. 

‘‘(a) PURPOSE.—The purpose of this section is to facilitate 

collaborative processes between patients, caregivers or authorized 

representatives, and clinicians that engages the patient, caregiver 

or authorized representative in decisionmaking, provides patients, 

caregivers or authorized representatives with information about 

trade-offs among treatment options, and facilitates the incorporation 

of patient preferences and values into the medical plan. 

‘‘(b) DEFINITIONS.—In this section: 

‘‘(1) PATIENT DECISION AID.—The term ‘patient decision aid’ 

means an educational tool that helps patients, caregivers or 

authorized representatives understand and communicate their 

beliefs and preferences related to their treatment options, and 

to decide with their health care provider what treatments are 

best for them based on their treatment options, scientific evidence, circumstances, beliefs, and preferences. 

‘‘(2) PREFERENCE SENSITIVE CARE.—The term ‘preference 

sensitive care’ means medical care for which the clinical evidence does not clearly support one treatment option such that 

the appropriate course of treatment depends on the values 

of the patient or the preferences of the patient, caregivers 

or authorized representatives regarding the benefits, harms 

and scientific evidence for each treatment option, the use of 

such care should depend on the informed patient choice among 

clinically appropriate treatment options. 

‘‘(c) ESTABLISHMENT OF INDEPENDENT STANDARDS FOR PATIENT

DECISION AIDS FOR PREFERENCE SENSITIVE CARE.— ‘‘(1) CONTRACT WITH ENTITY TO ESTABLISH STANDARDS AND

CERTIFY PATIENT DECISION AIDS.— 
H. R. 3590—410 

‘‘(A) IN GENERAL.—For purposes of supporting consensus-based standards for patient decision aids for preference sensitive care and a certification process for patient 

decision aids for use in the Federal health programs and 

by other interested parties, the Secretary shall have in 

effect a contract with the entity with a contract under 

section 1890 of the Social Security Act. Such contract shall 

provide that the entity perform the duties described in 

paragraph (2). 

‘‘(B) TIMING FOR FIRST CONTRACT.—As soon as practicable after the date of the enactment of this section, 

the Secretary shall enter into the first contract under 

subparagraph (A). 

‘‘(C) PERIOD OF CONTRACT.—A contract under subparagraph (A) shall be for a period of 18 months (except such 

contract may be renewed after a subsequent bidding 

process). 

‘‘(2) DUTIES.—The following duties are described in this 

paragraph: 

‘‘(A) DEVELOP AND IDENTIFY STANDARDS FOR PATIENT

DECISION AIDS.—The entity shall synthesize evidence and 

convene a broad range of experts and key stakeholders 

to develop and identify consensus-based standards to 

evaluate patient decision aids for preference sensitive care. 

‘‘(B) ENDORSE PATIENT DECISION AIDS.—The entity shall 

review patient decision aids and develop a certification 

process whether patient decision aids meet the standards 

developed and identified under subparagraph (A). The 

entity shall give priority to the review and certification 

of patient decision aids for preference sensitive care. 

‘‘(d) PROGRAM TO DEVELOP, UPDATE AND PATIENT DECISION

AIDS TO ASSIST HEALTH CARE PROVIDERS AND PATIENTS.— 

‘‘(1) IN GENERAL.—The Secretary, acting through the 

Director, and in coordination with heads of other relevant agencies, such as the Director of the Centers for Disease Control 

and Prevention and the Director of the National Institutes 

of Health, shall establish a program to award grants or contracts— 

‘‘(A) to develop, update, and produce patient decision 

aids for preference sensitive care to assist health care 

providers in educating patients, caregivers, and authorized 

representatives concerning the relative safety, relative 

effectiveness (including possible health outcomes and 

impact on functional status), and relative cost of treatment 

or, where appropriate, palliative care options; 

‘‘(B) to test such materials to ensure such materials 

are balanced and evidence based in aiding health care 

providers and patients, caregivers, and authorized representatives to make informed decisions about patient care 

and can be easily incorporated into a broad array of practice 

settings; and 

‘‘(C) to educate providers on the use of such materials, 

including through academic curricula. 

‘‘(2) REQUIREMENTS FOR PATIENT DECISION AIDS.—Patient 

decision aids developed and produced pursuant to a grant or 

contract under paragraph (1)— 
H. R. 3590—411 

‘‘(A) shall be designed to engage patients, caregivers, 

and authorized representatives in informed decisionmaking 

with health care providers; 

‘‘(B) shall present up-to-date clinical evidence about 

the risks and benefits of treatment options in a form and 

manner that is age-appropriate and can be adapted for 

patients, caregivers, and authorized representatives from 

a variety of cultural and educational backgrounds to reflect 

the varying needs of consumers and diverse levels of health 

literacy; 

‘‘(C) shall, where appropriate, explain why there is 

a lack of evidence to support one treatment option over 

another; and 

‘‘(D) shall address health care decisions across the age 

span, including those affecting vulnerable populations 

including children. 

‘‘(3) DISTRIBUTION.—The Director shall ensure that patient 

decision aids produced with grants or contracts under this 

section are available to the public. 

‘‘(4) NONDUPLICATION OF EFFORTS.—The Director shall 

ensure that the activities under this section of the Agency 

and other agencies, including the Centers for Disease Control 

and Prevention and the National Institutes of Health, are free 

of unnecessary duplication of effort. 

‘‘(e) GRANTS TO SUPPORT SHARED DECISIONMAKING

IMPLEMENTATION.— 

‘‘(1) IN GENERAL.—The Secretary shall establish a program 

to provide for the phased-in development, implementation, and 

evaluation of shared decisionmaking using patient decision aids 

to meet the objective of improving the understanding of patients 

of their medical treatment options. 

‘‘(2) SHARED DECISIONMAKING RESOURCE CENTERS.— 

‘‘(A) IN GENERAL.—The Secretary shall provide grants 

for the establishment and support of Shared Decisionmaking Resource Centers (referred to in this subsection 

as ‘Centers’) to provide technical assistance to providers 

and to develop and disseminate best practices and other 

information to support and accelerate adoption, 

implementation, and effective use of patient decision aids 

and shared decisionmaking by providers. 

‘‘(B) OBJECTIVES.—The objective of a Center is to 

enhance and promote the adoption of patient decision aids 

and shared decisionmaking through— 

‘‘(i) providing assistance to eligible providers with 

the implementation and effective use of, and training 

on, patient decision aids; and 

‘‘(ii) the dissemination of best practices and 

research on the implementation and effective use of 

patient decision aids. 

‘‘(3) SHARED DECISIONMAKING PARTICIPATION GRANTS.— 

‘‘(A) IN GENERAL.—The Secretary shall provide grants 

to health care providers for the development and 

implementation of shared decisionmaking techniques and 

to assess the use of such techniques. 

‘‘(B) PREFERENCE.—In order to facilitate the use of 

best practices, the Secretary shall provide a preference 

in making grants under this subsection to health care 
H. R. 3590—412 

providers who participate in training by Shared Decisionmaking Resource Centers or comparable training. 

‘‘(C) LIMITATION.—Funds under this paragraph shall 

not be used to purchase or implement use of patient decision aids other than those certified under the process 

identified in subsection (c). 

‘‘(4) GUIDANCE.—The Secretary may issue guidance to 

eligible grantees under this subsection on the use of patient 

decision aids. 

‘‘(f) FUNDING.—For purposes of carrying out this section there 

are authorized to be appropriated such sums as may be necessary 

for fiscal year 2010 and each subsequent fiscal year.’’. 

SEC. 3507. PRESENTATION OF PRESCRIPTION DRUG BENEFIT AND 

RISK INFORMATION. 

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

(referred to in this section as the ‘‘Secretary’’), acting through the 

Commissioner of Food and Drugs, shall determine whether the 

addition of quantitative summaries of the benefits and risks of 

prescription drugs in a standardized format (such as a table or 

drug facts box) to the promotional labeling or print advertising 

of such drugs would improve health care decisionmaking by clinicians and patients and consumers. 

(b) REVIEW AND CONSULTATION.—In making the determination 

under subsection (a), the Secretary shall review all available scientific evidence and research on decisionmaking and social and 

cognitive psychology and consult with drug manufacturers, clinicians, patients and consumers, experts in health literacy, representatives of racial and ethnic minorities, and experts in women’s 

and pediatric health. 

(c) REPORT.—Not later than 1 year after the date of enactment 

of this Act, the Secretary shall submit to Congress a report that 

provides— 

(1) the determination by the Secretary under subsection 

(a); and 

(2) the reasoning and analysis underlying that determination. 

(d) AUTHORITY.—If the Secretary determines under subsection 

(a) that the addition of quantitative summaries of the benefits 

and risks of prescription drugs in a standardized format (such 

as a table or drug facts box) to the promotional labeling or print 

advertising of such drugs would improve health care decisionmaking 

by clinicians and patients and consumers, then the Secretary, not 

later than 3 years after the date of submission of the report under 

subsection (c), shall promulgate proposed regulations as necessary 

to implement such format. 

(e) CLARIFICATION.—Nothing in this section shall be construed 

to restrict the existing authorities of the Secretary with respect 

to benefit and risk information. 

SEC. 3508. DEMONSTRATION PROGRAM TO INTEGRATE QUALITY 

IMPROVEMENT AND PATIENT SAFETY TRAINING INTO 

CLINICAL EDUCATION OF HEALTH PROFESSIONALS. 

(a) IN GENERAL.—The Secretary may award grants to eligible 

entities or consortia under this section to carry out demonstration 

projects to develop and implement academic curricula that 

integrates quality improvement and patient safety in the clinical 
H. R. 3590—413 

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 or consortium shall— 

(1) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require; 

(2) be or include— 

(A) a health professions school; 

(B) a school of public health; 

(C) a school of social work; 

(D) a school of nursing; 

(E) a school of pharmacy; 

(F) an institution with a graduate medical education 

program; or 

(G) a school of health care administration; 

(3) collaborate in the development of curricula described 

in subsection (a) with an organization that accredits such school 

or institution; 

(4) provide for the collection of data regarding the effectiveness of the demonstration project; and 

(5) provide matching funds in accordance with subsection 

(c). 

(c) MATCHING FUNDS.— 

(1) IN GENERAL.—The Secretary may award a grant to 

an entity or consortium under this section only if the entity 

or consortium 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 

$5 of Federal funds provided under the grant. 

(2) DETERMINATION OF AMOUNT CONTRIBUTED.—Non-Federal contributions under paragraph (1) may be in cash or inkind, 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. 

(d) EVALUATION.—The Secretary shall take such action as may 

be necessary to evaluate the projects funded under this section 

and publish, make publicly available, and disseminate the results 

of such evaluations on as wide a basis as is practicable. 

(e) REPORTS.—Not later than 2 years after the date of enactment of this section, 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 supported under this section; and 

(2) contains recommendations for Congress based on the 

evaluation conducted under subsection (d). 

SEC. 3509. IMPROVING WOMEN’S HEALTH. 

(a) HEALTH AND HUMAN SERVICES OFFICE ON WOMEN’S

HEALTH.— 
H. R. 3590—414 

(1) ESTABLISHMENT.—Part A of title II of the Public Health 

Service Act (42 U.S.C. 202 et seq.) is amended by adding 

at the end the following: 

‘‘SEC. 229. HEALTH AND HUMAN SERVICES OFFICE ON WOMEN’S 

HEALTH. 

‘‘(a) ESTABLISHMENT OF OFFICE.—There is established within 

the Office of the Secretary, an Office on Women’s Health (referred 

to in this section as the ‘Office’). The Office shall be headed by 

a Deputy Assistant Secretary for Women’s Health who may report 

to the Secretary. 

‘‘(b) DUTIES.—The Secretary, acting through the Office, with 

respect to the health concerns of women, shall— 

‘‘(1) establish short-range and long-range goals and objectives within the Department of Health and Human Services 

and, as relevant and appropriate, coordinate with other appropriate offices on activities within the Department that relate 

to disease prevention, health promotion, service delivery, 

research, and public and health care professional education, 

for issues of particular concern to women throughout their 

lifespan; 

‘‘(2) provide expert advice and consultation to the Secretary 

concerning scientific, legal, ethical, and policy issues relating 

to women’s health; 

‘‘(3) monitor the Department of Health and Human Services’ offices, agencies, and regional activities regarding women’s 

health and identify needs regarding the coordination of activities, including intramural and extramural multidisciplinary 

activities; 

‘‘(4) establish a Department of Health and Human Services 

Coordinating Committee on Women’s Health, which shall be 

chaired by the Deputy Assistant Secretary for Women’s Health 

and composed of senior level representatives from each of the 

agencies and offices of the Department of Health and Human 

Services; 

‘‘(5) establish a National Women’s Health Information 

Center to— 

‘‘(A) facilitate the exchange of information regarding 

matters relating to health information, health promotion, 

preventive health services, research advances, and education in the appropriate use of health care; 

‘‘(B) facilitate access to such information; 

‘‘(C) assist in the analysis of issues and problems 

relating to the matters described in this paragraph; and 

‘‘(D) provide technical assistance with respect to the 

exchange of information (including facilitating the development of materials for such technical assistance); 

‘‘(6) coordinate efforts to promote women’s health programs 

and policies with the private sector; and 

‘‘(7) through publications and any other means appropriate, 

provide for the exchange of information between the Office 

and recipients of grants, contracts, and agreements under subsection (c), and between the Office and health professionals 

and the general public. 

‘‘(c) GRANTS AND CONTRACTS REGARDING DUTIES.— 
H. R. 3590—415 

‘‘(1) AUTHORITY.—In carrying out subsection (b), the Secretary may make grants to, and enter into cooperative agreements, contracts, and interagency agreements with, public and 

private entities, agencies, and organizations. 

‘‘(2) EVALUATION AND DISSEMINATION.—The Secretary shall 

directly or through contracts with public and private entities, 

agencies, and organizations, provide for evaluations of projects 

carried out with financial assistance provided under paragraph 

(1) and for the dissemination of information developed as a 

result of such projects. 

‘‘(d) REPORTS.—Not later than 1 year after the date of enactment of this section, and every second year thereafter, the Secretary 

shall prepare and submit to the appropriate committees of Congress 

a report describing the activities carried out under this section 

during the period for which the report is being prepared. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

(2) TRANSFER OF FUNCTIONS.—There are transferred to the 

Office on Women’s Health (established under section 229 of 

the Public Health Service Act, as added by this section), all 

functions exercised by the Office on Women’s Health of the 

Public Health Service prior to the date of enactment of this 

section, including all personnel and compensation authority, 

all delegation and assignment authority, and all remaining 

appropriations. All orders, determinations, rules, regulations, 

permits, agreements, grants, contracts, certificates, licenses, 

registrations, privileges, and other administrative actions 

that— 

(A) have been issued, made, granted, or allowed to 

become effective by the President, any Federal agency or 

official thereof, or by a court of competent jurisdiction, 

in the performance of functions transferred under this paragraph; and 

(B) are in effect at the time this section takes effect, 

or were final before the date of enactment of this section 

and are to become effective on or after such date, 

shall continue in effect according to their terms until modified, 

terminated, superseded, set aside, or revoked in accordance 

with law by the President, the Secretary, or other authorized 

official, a court of competent jurisdiction, or by operation of 

law. 

(b) CENTERS FOR DISEASE CONTROL AND PREVENTION OFFICE

OF WOMEN’S HEALTH.—Part A of title III of the Public Health 

Service Act (42 U.S.C. 241 et seq.) is amended by adding at the 

end the following: 

‘‘SEC. 310A. CENTERS FOR DISEASE CONTROL AND PREVENTION 

OFFICE OF WOMEN’S HEALTH. 

‘‘(a) ESTABLISHMENT.—There is established within the Office 

of the Director of the Centers for Disease Control and Prevention, 

an office to be known as the Office of Women’s Health (referred 

to in this section as the ‘Office’). The Office shall be headed by 

a director who shall be appointed by the Director of such Centers. 

‘‘(b) PURPOSE.—The Director of the Office shall— 
H. R. 3590—416 

‘‘(1) report to the Director of the Centers for Disease Control 

and Prevention on the current level of the Centers’ activity 

regarding women’s health conditions across, where appropriate, 

age, biological, and sociocultural contexts, in all aspects of 

the Centers’ work, including prevention programs, public and 

professional education, services, and treatment; 

‘‘(2) establish short-range and long-range goals and objectives within the Centers for women’s health and, as relevant 

and appropriate, coordinate with other appropriate offices on 

activities within the Centers that relate to prevention, research, 

education and training, service delivery, and policy development, for issues of particular concern to women; 

‘‘(3) identify projects in women’s health that should be 

conducted or supported by the Centers; 

‘‘(4) consult with health professionals, nongovernmental 

organizations, consumer organizations, women’s health professionals, and other individuals and groups, as appropriate, on 

the policy of the Centers with regard to women; and 

‘‘(5) serve as a member of the Department of Health and 

Human Services Coordinating Committee on Women’s Health 

(established under section 229(b)(4)). 

‘‘(c) DEFINITION.—As used in this section, the term ‘women’s 

health conditions’, with respect to women of all age, ethnic, and 

racial groups, means diseases, disorders, and conditions— 

‘‘(1) unique to, significantly more serious for, or significantly 

more prevalent in women; and 

‘‘(2) for which the factors of medical risk or type of medical 

intervention are different for women, or for which there is 

reasonable evidence that indicates that such factors or types 

may be different for women. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

(c) OFFICE OF WOMEN’S HEALTH RESEARCH.—Section 486(a) 

of the Public Health Service Act (42 U.S.C. 287d(a)) is amended 

by inserting ‘‘and who shall report directly to the Director’’ before 

the period at the end thereof. 

(d) SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES ADMINISTRATION.—Section 501(f) of the Public Health Service Act (42 U.S.C. 

290aa(f)) is amended— 

(1) in paragraph (1), by inserting ‘‘who shall report directly 

to the Administrator’’ before the period; 

(2) by redesignating paragraph (4) as paragraph (5); and 

(3) by inserting after paragraph (3), the following: 

‘‘(4) OFFICE.—Nothing in this subsection shall be construed 

to preclude the Secretary from establishing within the Substance Abuse and Mental Health Administration an Office of 

Women’s Health.’’. 

(e) AGENCY FOR HEALTHCARE RESEARCH AND QUALITY ACTIVITIES REGARDING WOMEN’S HEALTH.—Part C of title IX of the Public 

Health Service Act (42 U.S.C. 299c et seq.) is amended— 

(1) by redesignating sections 925 and 926 as sections 926 

and 927, respectively; and 

(2) by inserting after section 924 the following: 
H. R. 3590—417 

‘‘SEC. 925. ACTIVITIES REGARDING WOMEN’S HEALTH. 

‘‘(a) ESTABLISHMENT.—There is established within the Office 

of the Director, an Office of Women’s Health and Gender-Based 

Research (referred to in this section as the ‘Office’). The Office 

shall be headed by a director who shall be appointed by the Director 

of Healthcare and Research Quality. 

‘‘(b) PURPOSE.—The official designated under subsection (a) 

shall— 

‘‘(1) report to the Director on the current Agency level 

of activity regarding women’s health, across, where appropriate, 

age, biological, and sociocultural contexts, in all aspects of 

Agency work, including the development of evidence reports 

and clinical practice protocols and the conduct of research into 

patient outcomes, delivery of health care services, quality of 

care, and access to health care; 

‘‘(2) establish short-range and long-range goals and objectives within the Agency for research important to women’s 

health and, as relevant and appropriate, coordinate with other 

appropriate offices on activities within the Agency that relate 

to health services and medical effectiveness research, for issues 

of particular concern to women; 

‘‘(3) identify projects in women’s health that should be 

conducted or supported by the Agency; 

‘‘(4) consult with health professionals, nongovernmental 

organizations, consumer organizations, women’s health professionals, and other individuals and groups, as appropriate, on 

Agency policy with regard to women; and 

‘‘(5) serve as a member of the Department of Health and 

Human Services Coordinating Committee on Women’s Health 

(established under section 229(b)(4)).’’. 

‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

(f) HEALTH RESOURCES AND SERVICES ADMINISTRATION OFFICE

OF WOMEN’S HEALTH.—Title VII of the Social Security Act (42 

U.S.C. 901 et seq.) is amended by adding at the end the following: 

‘‘SEC. 713. OFFICE OF WOMEN’S HEALTH. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish within the 

Office of the Administrator of the Health Resources and Services 

Administration, an office to be known as the Office of Women’s 

Health. The Office shall be headed by a director who shall be 

appointed by the Administrator. 

‘‘(b) PURPOSE.—The Director of the Office shall— 

‘‘(1) report to the Administrator on the current Administration level of activity regarding women’s health across, where 

appropriate, age, biological, and sociocultural contexts; 

‘‘(2) establish short-range and long-range goals and objectives within the Health Resources and Services Administration 

for women’s health and, as relevant and appropriate, coordinate 

with other appropriate offices on activities within the Administration that relate to health care provider training, health 

service delivery, research, and demonstration projects, for 

issues of particular concern to women; 

‘‘(3) identify projects in women’s health that should be 

conducted or supported by the bureaus of the Administration; 
H. R. 3590—418 

‘‘(4) consult with health professionals, nongovernmental 

organizations, consumer organizations, women’s health professionals, and other individuals and groups, as appropriate, on 

Administration policy with regard to women; and 

‘‘(5) serve as a member of the Department of Health and 

Human Services Coordinating Committee on Women’s Health 

(established under section 229(b)(4) of the Public Health Service 

Act). 

‘‘(c) CONTINUED ADMINISTRATION OF EXISTING PROGRAMS.—The 

Director of the Office shall assume the authority for the development, implementation, administration, and evaluation of any 

projects carried out through the Health Resources and Services 

Administration relating to women’s health on the date of enactment 

of this section. 

‘‘(d) DEFINITIONS.—For purposes of this section: 

‘‘(1) ADMINISTRATION.—The term ‘Administration’ means 

the Health Resources and Services Administration. 

‘‘(2) ADMINISTRATOR.—The term ‘Administrator’ means the 

Administrator of the Health Resources and Services Administration. 

‘‘(3) OFFICE.—The term ‘Office’ means the Office of Women’s 

Health established under this section in the Administration. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

(g) FOOD AND DRUG ADMINISTRATION OFFICE OF WOMEN’S

HEALTH.—Chapter X of the Federal Food, Drug, and Cosmetic Act 

(21 U.S.C. 391 et seq.) is amended by adding at the end the 

following: 

‘‘SEC. 1011. OFFICE OF WOMEN’S HEALTH. 

‘‘(a) ESTABLISHMENT.—There is established within the Office 

of the Commissioner, an office to be known as the Office of Women’s 

Health (referred to in this section as the ‘Office’). The Office shall 

be headed by a director who shall be appointed by the Commissioner 

of Food and Drugs. 

‘‘(b) PURPOSE.—The Director of the Office shall— 

‘‘(1) report to the Commissioner of Food and Drugs on 

current Food and Drug Administration (referred to in this 

section as the ‘Administration’) levels of activity regarding 

women’s participation in clinical trials and the analysis of 

data by sex in the testing of drugs, medical devices, and 

biological products across, where appropriate, age, biological, 

and sociocultural contexts; 

‘‘(2) establish short-range and long-range goals and objectives within the Administration for issues of particular concern 

to women’s health within the jurisdiction of the Administration, 

including, where relevant and appropriate, adequate inclusion 

of women and analysis of data by sex in Administration protocols and policies; 

‘‘(3) provide information to women and health care providers on those areas in which differences between men and 

women exist; 

‘‘(4) consult with pharmaceutical, biologics, and device 

manufacturers, health professionals with expertise in women’s 
H. R. 3590—419 

issues, consumer organizations, and women’s health professionals on Administration policy with regard to women; 

‘‘(5) make annual estimates of funds needed to monitor 

clinical trials and analysis of data by sex in accordance with 

needs that are identified; and 

‘‘(6) serve as a member of the Department of Health and 

Human Services Coordinating Committee on Women’s Health 

(established under section 229(b)(4) of the Public Health Service 

Act). 

‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

(h) NO NEW REGULATORY AUTHORITY.—Nothing in this section 

and the amendments made by this section may be construed as 

establishing regulatory authority or modifying any existing regulatory authority. 

(i) LIMITATION ON TERMINATION.—Notwithstanding any other 

provision of law, a Federal office of women’s health (including 

the Office of Research on Women’s Health of the National Institutes 

of Health) or Federal appointive position with primary responsibility 

over women’s health issues (including the Associate Administrator 

for Women’s Services under the Substance Abuse and Mental 

Health Services Administration) that is in existence on the date 

of enactment of this section shall not be terminated, reorganized, 

or have any of it’s powers or duties transferred unless such termination, reorganization, or transfer is approved by Congress through 

the adoption of a concurrent resolution of approval. 

(j) RULE OF CONSTRUCTION.—Nothing in this section (or the 

amendments made by this section) shall be construed to limit 

the authority of the Secretary of Health and Human Services with 

respect to women’s health, or with respect to activities carried 

out through the Department of Health and Human Services on 

the date of enactment of this section. 

SEC. 3510. PATIENT NAVIGATOR PROGRAM. 

Section 340A of the Public Health Service Act (42 U.S.C. 256a) 

is amended— 

(1) by striking subsection (d)(3) and inserting the following: 

‘‘(3) LIMITATIONS ON GRANT PERIOD.—In carrying out this 

section, the Secretary shall ensure that the total period of 

a grant does not exceed 4 years.’’; 

(2) in subsection (e), by adding at the end the following: 

‘‘(3) MINIMUM CORE PROFICIENCIES.—The Secretary shall 

not award a grant to an entity under this section unless such 

entity provides assurances that patient navigators recruited, 

assigned, trained, or employed using grant funds meet minimum core proficiencies, as defined by the entity that submits 

the application, that are tailored for the main focus or intervention of the navigator involved.’’; and 

(3) in subsection (m)— 

(A) in paragraph (1), by striking ‘‘and $3,500,000 for 

fiscal year 2010.’’ and inserting ‘‘$3,500,000 for fiscal year 

2010, and such sums as may be necessary for each of 

fiscal years 2011 through 2015.’’; and 

(B) in paragraph (2), by striking ‘‘2010’’ and inserting 

‘‘2015’’. 
H. R. 3590—420 

SEC. 3511. AUTHORIZATION OF APPROPRIATIONS. 

Except where otherwise provided in this subtitle (or an amendment made by this subtitle), there is authorized to be appropriated 

such sums as may be necessary to carry out this subtitle (and 

such amendments made by this subtitle). 

Subtitle G—Protecting and Improving 

Guaranteed Medicare Benefits 

SEC. 3601. PROTECTING AND IMPROVING GUARANTEED MEDICARE 

BENEFITS. 

(a) PROTECTING GUARANTEED MEDICARE BENEFITS.—Nothing 

in the provisions of, or amendments made by, this Act shall result 

in a reduction of guaranteed benefits under title XVIII of the 

Social Security Act. 

(b) ENSURING THAT MEDICARE SAVINGS BENEFIT THE MEDICARE

PROGRAM AND MEDICARE BENEFICIARIES.—Savings generated for 

the Medicare program under title XVIII of the Social Security 

Act under the provisions of, and amendments made by, this Act 

shall extend the solvency of the Medicare trust funds, reduce Medicare premiums and other cost-sharing for beneficiaries, and improve 

or expand guaranteed Medicare benefits and protect access to Medicare providers. 

SEC. 3602. NO CUTS IN GUARANTEED BENEFITS. 

Nothing in this Act shall result in the reduction or elimination 

of any benefits guaranteed by law to participants in Medicare 

Advantage plans. 

TITLE IV—PREVENTION OF CHRONIC 

DISEASE AND IMPROVING PUBLIC 

HEALTH 

Subtitle A—Modernizing Disease 

Prevention and Public Health Systems 

SEC. 4001. NATIONAL PREVENTION, HEALTH PROMOTION AND PUBLIC 

HEALTH COUNCIL. 

(a) ESTABLISHMENT.—The President shall establish, within the 

Department of Health and Human Services, a council to be known 

as the ‘‘National Prevention, Health Promotion and Public Health 

Council’’ (referred to in this section as the ‘‘Council’’). 

(b) CHAIRPERSON.—The President shall appoint the Surgeon 

General to serve as the chairperson of the Council. 

(c) COMPOSITION.—The Council shall be composed of— 

(1) the Secretary of Health and Human Services; 

(2) the Secretary of Agriculture; 

(3) the Secretary of Education; 

(4) the Chairman of the Federal Trade Commission; 

(5) the Secretary of Transportation; 

(6) the Secretary of Labor; 

(7) the Secretary of Homeland Security; 
H. R. 3590—421 

(8) the Administrator of the Environmental Protection 

Agency; 

(9) the Director of the Office of National Drug Control 

Policy; 

(10) the Director of the Domestic Policy Council; 

(11) the Assistant Secretary for Indian Affairs; 

(12) the Chairman of the Corporation for National and 

Community Service; and 

(13) the head of any other Federal agency that the chairperson determines is appropriate. 

(d) PURPOSES AND DUTIES.—The Council shall— 

(1) provide coordination and leadership at the Federal level, 

and among all Federal departments and agencies, with respect 

to prevention, wellness and health promotion practices, the 

public health system, and integrative health care in the United 

States; 

(2) after obtaining input from relevant stakeholders, 

develop a national prevention, health promotion, public health, 

and integrative health care strategy that incorporates the most 

effective and achievable means of improving the health status 

of Americans and reducing the incidence of preventable illness 

and disability in the United States; 

(3) provide recommendations to the President and Congress 

concerning the most pressing health issues confronting the 

United States and changes in Federal policy to achieve national 

wellness, health promotion, and public health goals, including 

the reduction of tobacco use, sedentary behavior, and poor 

nutrition; 

(4) consider and propose evidence-based models, policies, 

and innovative approaches for the promotion of transformative 

models of prevention, integrative health, and public health 

on individual and community levels across the United States; 

(5) establish processes for continual public input, including 

input from State, regional, and local leadership communities 

and other relevant stakeholders, including Indian tribes and 

tribal organizations; 

(6) submit the reports required under subsection (g); and 

(7) carry out other activities determined appropriate by 

the President. 

(e) MEETINGS.—The Council shall meet at the call of the Chairperson. 

(f) ADVISORY GROUP.— 

(1) IN GENERAL.—The President shall establish an Advisory 

Group to the Council to be known as the ‘‘Advisory Group 

on Prevention, Health Promotion, and Integrative and Public 

Health’’ (hereafter referred to in this section as the ‘‘Advisory 

Group’’). The Advisory Group shall be within the Department 

of Health and Human Services and report to the Surgeon 

General. 

(2) COMPOSITION.— 

(A) IN GENERAL.—The Advisory Group shall be composed of not more than 25 non-Federal members to be 

appointed by the President. 

(B) REPRESENTATION.—In appointing members under 

subparagraph (A), the President shall ensure that the 

Advisory Group includes a diverse group of licensed health 
H. R. 3590—422 

professionals, including integrative health practitioners 

who have expertise in— 

(i) worksite health promotion; 

(ii) community services, including community 

health centers; 

(iii) preventive medicine; 

(iv) health coaching; 

(v) public health education; 

(vi) geriatrics; and 

(vii) rehabilitation medicine. 

(3) PURPOSES AND DUTIES.—The Advisory Group shall 

develop policy and program recommendations and advise the 

Council on lifestyle-based chronic disease prevention and 

management, integrative health care practices, and health promotion. 

(g) NATIONAL PREVENTION AND HEALTH PROMOTION

STRATEGY.—Not later than 1 year after the date of enactment 

of this Act, the Chairperson, in consultation with the Council, 

shall develop and make public a national prevention, health promotion and public health strategy, and shall review and revise 

such strategy periodically. Such strategy shall— 

(1) set specific goals and objectives for improving the health 

of the United States through federally-supported prevention, 

health promotion, and public health programs, consistent with 

ongoing goal setting efforts conducted by specific agencies; 

(2) establish specific and measurable actions and timelines 

to carry out the strategy, and determine accountability for 

meeting those timelines, within and across Federal departments 

and agencies; and 

(3) make recommendations to improve Federal efforts 

relating to prevention, health promotion, public health, and 

integrative health care practices to ensure Federal efforts are 

consistent with available standards and evidence. 

(h) REPORT.—Not later than July 1, 2010, and annually thereafter through January 1, 2015, the Council shall submit to the 

President and the relevant committees of Congress, a report that— 

(1) describes the activities and efforts on prevention, health 

promotion, and public health and activities to develop a national 

strategy conducted by the Council during the period for which 

the report is prepared; 

(2) describes the national progress in meeting specific 

prevention, health promotion, and public health goals defined 

in the strategy and further describes corrective actions recommended by the Council and taken by relevant agencies and 

organizations to meet these goals; 

(3) contains a list of national priorities on health promotion 

and disease prevention to address lifestyle behavior modification (smoking cessation, proper nutrition, appropriate exercise, 

mental health, behavioral health, substance use disorder, and 

domestic violence screenings) and the prevention measures for 

the 5 leading disease killers in the United States; 

(4) contains specific science-based initiatives to achieve the 

measurable goals of Healthy People 2010 regarding nutrition, 

exercise, and smoking cessation, and targeting the 5 leading 

disease killers in the United States; 

(5) contains specific plans for consolidating Federal health 

programs and Centers that exist to promote healthy behavior 
H. R. 3590—423 

and reduce disease risk (including eliminating programs and 

offices determined to be ineffective in meeting the priority 

goals of Healthy People 2010); 

(6) contains specific plans to ensure that all Federal health 

care programs are fully coordinated with science-based prevention recommendations by the Director of the Centers for Disease 

Control and Prevention; and 

(7) contains specific plans to ensure that all non-Department of Health and Human Services prevention programs are 

based on the science-based guidelines developed by the Centers 

for Disease Control and Prevention under paragraph (4). 

(i) PERIODIC REVIEWS.—The Secretary and the Comptroller 

General of the United States shall jointly conduct periodic reviews, 

not less than every 5 years, and evaluations of every Federal 

disease prevention and health promotion initiative, program, and 

agency. Such reviews shall be evaluated based on effectiveness 

in meeting metrics-based goals with an analysis posted on such 

agencies’ public Internet websites. 

SEC. 4002. PREVENTION AND PUBLIC HEALTH FUND. 

(a) PURPOSE.—It is the purpose of this section to establish 

a Prevention and Public Health Fund (referred to in this section 

as the ‘‘Fund’’), to be administered through the Department of 

Health and Human Services, Office of the Secretary, to provide 

for expanded and sustained national investment in prevention and 

public health programs to improve health and help restrain the 

rate of growth in private and public sector health care costs. 

(b) FUNDING.—There are hereby authorized to be appropriated, 

and appropriated, to the Fund, out of any monies in the Treasury 

not otherwise appropriated— (1) for fiscal year 2010, $500,000,000; 

(2) for fiscal year 2011, $750,000,000; 

(3) for fiscal year 2012, $1,000,000,000; 

(4) for fiscal year 2013, $1,250,000,000; 

(5) for fiscal year 2014, $1,500,000,000; and 

(6) for fiscal year 2015, and each fiscal year thereafter, $2,000,000,000. 

(c) USE OF FUND.—The Secretary shall transfer amounts in 

the Fund to accounts within the Department of Health and Human 

Services to increase funding, over the fiscal year 2008 level, for 

programs authorized by the Public Health Service Act, for prevention, wellness, and public health activities including prevention 

research and health screenings, such as the Community Transformation grant program, the Education and Outreach Campaign 

for Preventive Benefits, and immunization programs. 

(d) TRANSFER AUTHORITY.—The Committee on Appropriations 

of the Senate and the Committee on Appropriations of the House 

of Representatives may provide for the transfer of funds in the 

Fund to eligible activities under this section, subject to subsection 

(c). 

SEC. 4003. CLINICAL AND COMMUNITY PREVENTIVE SERVICES. 

(a) PREVENTIVE SERVICES TASK FORCE.—Section 915 of the 

Public Health Service Act (42 U.S.C. 299b–4) is amended by striking 

subsection (a) and inserting the following: 

‘‘(a) PREVENTIVE SERVICES TASK FORCE.— 

‘‘(1) ESTABLISHMENT AND PURPOSE.—The Director shall convene an independent Preventive Services Task Force (referred 
H. R. 3590—424 

to in this subsection as the ‘Task Force’) to be composed of 

individuals with appropriate expertise. Such Task Force shall 

review the scientific evidence related to the effectiveness, appropriateness, and cost-effectiveness of clinical preventive services 

for the purpose of developing recommendations for the health 

care community, and updating previous clinical preventive recommendations, to be published in the Guide to Clinical Preventive Services (referred to in this section as the ‘Guide’), for 

individuals and organizations delivering clinical services, 

including primary care professionals, health care systems, 

professional societies, employers, community organizations, 

non-profit organizations, Congress and other policy-makers, 

governmental public health agencies, health care quality 

organizations, and organizations developing national health 

objectives. Such recommendations shall consider clinical 

preventive best practice recommendations from the Agency for 

Healthcare Research and Quality, the National Institutes of 

Health, the Centers for Disease Control and Prevention, the 

Institute of Medicine, specialty medical associations, patient 

groups, and scientific societies. 

‘‘(2) DUTIES.—The duties of the Task Force shall include— 

‘‘(A) the development of additional topic areas for new 

recommendations and interventions related to those topic 

areas, including those related to specific sub-populations 

and age groups; 

‘‘(B) at least once during every 5-year period, review 

interventions and update recommendations related to 

existing topic areas, including new or improved techniques 

to assess the health effects of interventions; 

‘‘(C) improved integration with Federal Government 

health objectives and related target setting for health 

improvement; 

‘‘(D) the enhanced dissemination of recommendations; 

‘‘(E) the provision of technical assistance to those 

health care professionals, agencies and organizations that 

request help in implementing the Guide recommendations; 

and 

‘‘(F) the submission of yearly reports to Congress and 

related agencies identifying gaps in research, such as 

preventive services that receive an insufficient evidence 

statement, and recommending priority areas that deserve 

further examination, including areas related to populations 

and age groups not adequately addressed by current recommendations. 

‘‘(3) ROLE OF AGENCY.—The Agency shall provide ongoing 

administrative, research, and technical support for the operations of the Task Force, including coordinating and supporting 

the dissemination of the recommendations of the Task Force, 

ensuring adequate staff resources, and assistance to those 

organizations requesting it for implementation of the Guide’s 

recommendations. 

‘‘(4) COORDINATION WITH COMMUNITY PREVENTIVE SERVICES

TASK FORCE.—The Task Force shall take appropriate steps to 

coordinate its work with the Community Preventive Services 

Task Force and the Advisory Committee on Immunization Practices, including the examination of how each task force’s recommendations interact at the nexus of clinic and community. 
H. R. 3590—425 

‘‘(5) OPERATION.—Operation. In carrying out the duties 

under paragraph (2), the Task Force is not subject to the 

provisions of Appendix 2 of title 5, United States Code. 

‘‘(6) INDEPENDENCE.—All members of the Task Force convened under this subsection, and any recommendations made 

by such members, shall be independent and, to the extent 

practicable, not subject to political pressure. 

‘‘(7) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated such sums as may be necessary 

for each fiscal year to carry out the activities of the Task 

Force.’’. 

(b) COMMUNITY PREVENTIVE SERVICES TASK FORCE.— 

(1) IN GENERAL.—Part P of title III of the Public Health 

Service Act, as amended by paragraph (2), is amended by 

adding at the end the following: 

‘‘SEC. 399U. COMMUNITY PREVENTIVE SERVICES TASK FORCE. 

‘‘(a) ESTABLISHMENT AND PURPOSE.—The Director of the Centers for Disease Control and Prevention shall convene an independent Community Preventive Services Task Force (referred to 

in this subsection as the ‘Task Force’) to be composed of individuals 

with appropriate expertise. Such Task Force shall review the scientific evidence related to the effectiveness, appropriateness, and 

cost-effectiveness of community preventive interventions for the 

purpose of developing recommendations, to be published in the 

Guide to Community Preventive Services (referred to in this section 

as the ‘Guide’), for individuals and organizations delivering population-based services, including primary care professionals, health 

care systems, professional societies, employers, community 

organizations, non-profit organizations, schools, governmental 

public health agencies, Indian tribes, tribal organizations and urban 

Indian organizations, medical groups, Congress and other policymakers. Community preventive services include any policies, programs, processes or activities designed to affect or otherwise 

affecting health at the population level. 

‘‘(b) DUTIES.—The duties of the Task Force shall include— 

‘‘(1) the development of additional topic areas for new recommendations and interventions related to those topic areas, 

including those related to specific populations and age groups, 

as well as the social, economic and physical environments that 

can have broad effects on the health and disease of populations 

and health disparities among sub-populations and age groups; 

‘‘(2) at least once during every 5-year period, review interventions and update recommendations related to existing topic 

areas, including new or improved techniques to assess the 

health effects of interventions, including health impact assessment and population health modeling; 

‘‘(3) improved integration with Federal Government health 

objectives and related target setting for health improvement; 

‘‘(4) the enhanced dissemination of recommendations; 

‘‘(5) the provision of technical assistance to those health 

care professionals, agencies, and organizations that request 

help in implementing the Guide recommendations; and 

‘‘(6) providing yearly reports to Congress and related agencies identifying gaps in research and recommending priority 

areas that deserve further examination, including areas related 
H. R. 3590—426 

to populations and age groups not adequately addressed by 

current recommendations. 

‘‘(c) ROLE OF AGENCY.—The Director shall provide ongoing 

administrative, research, and technical support for the operations 

of the Task Force, including coordinating and supporting the 

dissemination of the recommendations of the Task Force, ensuring 

adequate staff resources, and assistance to those organizations 

requesting it for implementation of Guide recommendations. 

‘‘(d) COORDINATION WITH PREVENTIVE SERVICES TASK FORCE.— 

The Task Force shall take appropriate steps to coordinate its work 

with the U.S. Preventive Services Task Force and the Advisory 

Committee on Immunization Practices, including the examination 

of how each task force’s recommendations interact at the nexus 

of clinic and community. 

‘‘(e) OPERATION.—In carrying out the duties under subsection 

(b), the Task Force shall not be subject to the provisions of Appendix 

2 of title 5, United States Code. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary for each fiscal 

year to carry out the activities of the Task Force.’’. 

(2) TECHNICAL AMENDMENTS.— 

(A) Section 399R of the Public Health Service Act 

(as added by section 2 of the ALS Registry Act (Public 

Law 110–373; 122 Stat. 4047)) is redesignated as section 

399S. 

(B) Section 399R of such Act (as added by section 

3 of the Prenatally and Postnatally Diagnosed Conditions 

Awareness Act (Public Law 110–374; 122 Stat. 4051)) is 

redesignated as section 399T. 

SEC. 4004. EDUCATION AND OUTREACH CAMPAIGN REGARDING 

PREVENTIVE BENEFITS. 

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

(referred to in this section as the ‘‘Secretary’’) shall provide for 

the planning and implementation of a national public–private partnership for a prevention and health promotion outreach and education campaign to raise public awareness of health improvement 

across the life span. Such campaign shall include the dissemination 

of information that— 

(1) describes the importance of utilizing preventive services 

to promote wellness, reduce health disparities, and mitigate 

chronic disease; 

(2) promotes the use of preventive services recommended 

by the United States Preventive Services Task Force and the 

Community Preventive Services Task Force; 

(3) encourages healthy behaviors linked to the prevention 

of chronic diseases; 

(4) explains the preventive services covered under health 

plans offered through a Gateway; 

(5) describes additional preventive care supported by the 

Centers for Disease Control and Prevention, the Health 

Resources and Services Administration, the Substance Abuse 

and Mental Health Services Administration, the Advisory Committee on Immunization Practices, and other appropriate agencies; and 

(6) includes general health promotion information. 
H. R. 3590—427 

(b) CONSULTATION.—In coordinating the campaign under subsection (a), the Secretary shall consult with the Institute of Medicine 

to provide ongoing advice on evidence-based scientific information 

for policy, program development, and evaluation. 

(c) MEDIA CAMPAIGN.— 

(1) IN GENERAL.—Not later than 1 year after the date 

of enactment of this Act, the Secretary, acting through the 

Director of the Centers for Disease Control and Prevention, 

shall establish and implement a national science-based media 

campaign on health promotion and disease prevention. 

(2) REQUIREMENT OF CAMPAIGN.—The campaign implemented under paragraph (1)— 

(A) shall be designed to address proper nutrition, regular exercise, smoking cessation, obesity reduction, the 5 

leading disease killers in the United States, and secondary 

prevention through disease screening promotion; 

(B) shall be carried out through competitively bid contracts awarded to entities providing for the professional 

production and design of such campaign; 

(C) may include the use of television, radio, Internet, 

and other commercial marketing venues and may be targeted to specific age groups based on peer-reviewed social 

research; 

(D) shall not be duplicative of any other Federal efforts 

relating to health promotion and disease prevention; and 

(E) may include the use of humor and nationally recognized positive role models. 

(3) EVALUATION.—The Secretary shall ensure that the campaign implemented under paragraph (1) is subject to an independent evaluation every 2 years and shall report every 2 

years to Congress on the effectiveness of such campaigns 

towards meeting science-based metrics. 

(d) WEBSITE.—The Secretary, in consultation with privatesector experts, shall maintain or enter into a contract to maintain 

an Internet website to provide science-based information on guidelines for nutrition, regular exercise, obesity reduction, smoking cessation, and specific chronic disease prevention. Such website shall 

be designed to provide information to health care providers and 

consumers. 

(e) DISSEMINATION OF INFORMATION THROUGH PROVIDERS.— 

The Secretary, acting through the Centers for Disease Control and 

Prevention, shall develop and implement a plan for the dissemination of health promotion and disease prevention information consistent with national priorities, to health care providers who participate in Federal programs, including programs administered by the 

Indian Health Service, the Department of Veterans Affairs, the 

Department of Defense, and the Health Resources and Services 

Administration, and Medicare and Medicaid. 

(f) PERSONALIZED PREVENTION PLANS.— (1) CONTRACT.—The Secretary, acting through the Director 

of the Centers for Disease Control and Prevention, shall enter 

into a contract with a qualified entity for the development 

and operation of a Federal Internet website personalized 

prevention plan tool. 

(2) USE.—The website developed under paragraph (1) shall 

be designed to be used as a source of the most up-to-date 

scientific evidence relating to disease prevention for use by 
H. R. 3590—428 

individuals. Such website shall contain a component that 

enables an individual to determine their disease risk (based 

on personal health and family history, BMI, and other relevant 

information) relating to the 5 leading diseases in the United 

States, and obtain personalized suggestions for preventing such 

diseases. 

(g) INTERNET PORTAL.—The Secretary shall establish an Internet portal for accessing risk-assessment tools developed and maintained by private and academic entities. 

(h) PRIORITY FUNDING.—Funding for the activities authorized 

under this section shall take priority over funding provided through 

the Centers for Disease Control and Prevention for grants to States 

and other entities for similar purposes and goals as provided for 

in this section. Not to exceed $500,000,000 shall be expended on 

the campaigns and activities required under this section. 

(i) PUBLIC AWARENESS OF PREVENTIVE AND OBESITY-RELATED

SERVICES.— 

(1) INFORMATION TO STATES.—The Secretary of Health and 

Human Services shall provide guidance and relevant information to States and health care providers regarding preventive 

and obesity-related services that are available to Medicaid 

enrollees, including obesity screening and counseling for children and adults. 

(2) INFORMATION TO ENROLLEES.—Each State shall design 

a public awareness campaign to educate Medicaid enrollees 

regarding availability and coverage of such services, with the 

goal of reducing incidences of obesity. 

(3) REPORT.—Not later than January 1, 2011, and every 

3 years thereafter through January 1, 2017, the Secretary 

of Health and Human Services shall report to Congress on 

the status and effectiveness of efforts under paragraphs (1) 

and (2), including summaries of the States’ efforts to increase 

awareness of coverage of obesity-related services. 

(j) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out 

this section. 

Subtitle B—Increasing Access to Clinical 

Preventive Services 

SEC. 4101. SCHOOL-BASED HEALTH CENTERS. 

(a) GRANTS FOR THE ESTABLISHMENT OF SCHOOL-BASED HEALTH

CENTERS.— 

(1) PROGRAM.—The Secretary of Health and Human Services (in this subsection referred to as the ‘‘Secretary’’) shall 

establish a program to award grants to eligible entities to 

support the operation of school-based health centers. 

(2) ELIGIBILITY.—To be eligible for a grant under this subsection, an entity shall— 

(A) be a school-based health center or a sponsoring 

facility of a school-based health center; and 

(B) submit an application at such time, in such manner, 

and containing such information as the Secretary may 

require, including at a minimum an assurance that funds 

awarded under the grant shall not be used to provide 
H. R. 3590—429 

any service that is not authorized or allowed by Federal, 

State, or local law. 

(3) PREFERENCE.—In awarding grants under this section, 

the Secretary shall give preference to awarding grants for 

school-based health centers that serve a large population of 

children eligible for medical assistance under the State Medicaid plan under title XIX of the Social Security Act or under 

a waiver of such plan or children eligible for child health 

assistance under the State child health plan under title XXI 

of that Act (42 U.S.C. 1397aa et seq.). 

(4) LIMITATION ON USE OF FUNDS.—An eligible entity shall 

use funds provided under a grant awarded under this subsection only for expenditures for facilities (including the acquisition or improvement of land, or the acquisition, construction, 

expansion, replacement, or other improvement of any building 

or other facility), equipment, or similar expenditures, as specified by the Secretary. No funds provided under a grant awarded 

under this section shall be used for expenditures for personnel 

or to provide health services. 

(5) APPROPRIATIONS.—Out of any funds in the Treasury 

not otherwise appropriated, there is appropriated for each of 

fiscal years 2010 through 2013, $50,000,000 for the purpose 

of carrying out this subsection. Funds appropriated under this 

paragraph shall remain available until expended. 

(6) DEFINITIONS.—In this subsection, the terms ‘‘schoolbased health center’’ and ‘‘sponsoring facility’’ have the 

meanings given those terms in section 2110(c)(9) of the Social 

Security Act (42 U.S.C. 1397jj(c)(9)). 

(b) GRANTS FOR THE OPERATION OF SCHOOL-BASED HEALTH

CENTERS.—Part Q of title III of the Public Health Service Act 

(42 U.S.C. 280h et seq.) is amended by adding at the end the 

following: 

‘‘SEC. 399Z–1. SCHOOL-BASED HEALTH CENTERS. 

‘‘(a) DEFINITIONS; ESTABLISHMENT OF CRITERIA.—In this section: 

‘‘(1) COMPREHENSIVE PRIMARY HEALTH SERVICES.—The term 

‘comprehensive primary health services’ means the core services 

offered by school-based health centers, which shall include the 

following: 

‘‘(A) PHYSICAL.—Comprehensive health assessments, 

diagnosis, and treatment of minor, acute, and chronic medical conditions, and referrals to, and follow-up for, specialty 

care and oral health services. 

‘‘(B) MENTAL HEALTH.—Mental health and substance 

use disorder assessments, crisis intervention, counseling, 

treatment, and referral to a continuum of services including 

emergency psychiatric care, community support programs, 

inpatient care, and outpatient programs. 

‘‘(2) MEDICALLY UNDERSERVED CHILDREN AND ADOLESCENTS.— 

‘‘(A) IN GENERAL.—The term ‘medically underserved 

children and adolescents’ means a population of children 

and adolescents who are residents of an area designated 

as a medically underserved area or a health professional 

shortage area by the Secretary. 

‘‘(B) CRITERIA.—The Secretary shall prescribe criteria 

for determining the specific shortages of personal health 
H. R. 3590—430 

services for medically underserved children and adolescents 

under subparagraph (A) that shall— 

‘‘(i) take into account any comments received by 

the Secretary from the chief executive officer of a State 

and local officials in a State; and 

‘‘(ii) include factors indicative of the health status 

of such children and adolescents of an area, including 

the ability of the residents of such area to pay for 

health services, the accessibility of such services, the 

availability of health professionals to such children 

and adolescents, and other factors as determined 

appropriate by the Secretary. 

‘‘(3) SCHOOL-BASED HEALTH CENTER.—The term ‘schoolbased health center’ means a health clinic that— 

‘‘(A) meets the definition of a school-based health center 

under section 2110(c)(9)(A) of the Social Security Act and 

is administered by a sponsoring facility (as defined in section 2110(c)(9)(B) of the Social Security Act); 

‘‘(B) provides, at a minimum, comprehensive primary 

health services during school hours to children and adolescents by health professionals in accordance with established 

standards, community practice, reporting laws, and other 

State laws, including parental consent and notification laws 

that are not inconsistent with Federal law; and 

‘‘(C) does not perform abortion services. 

‘‘(b) AUTHORITY TO AWARD GRANTS.—The Secretary shall award 

grants for the costs of the operation of school-based health centers 

(referred to in this section as ‘SBHCs’) that meet the requirements 

of this section. 

‘‘(c) APPLICATIONS.—To be eligible to receive a grant under 

this section, an entity shall— 

‘‘(1) be an SBHC (as defined in subsection (a)(3)); and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing— 

‘‘(A) evidence that the applicant meets all criteria necessary to be designated an SBHC; 

‘‘(B) evidence of local need for the services to be provided by the SBHC; 

‘‘(C) an assurance that— 

‘‘(i) SBHC services will be provided to those children and adolescents for whom parental or guardian 

consent has been obtained in cooperation with Federal, 

State, and local laws governing health care service 

provision to children and adolescents; 

‘‘(ii) the SBHC has made and will continue to 

make every reasonable effort to establish and maintain 

collaborative relationships with other health care providers in the catchment area of the SBHC; 

‘‘(iii) the SBHC will provide on-site access during 

the academic day when school is in session and 24- 

hour coverage through an on-call system and through 

its backup health providers to ensure access to services 

on a year-round basis when the school or the SBHC 

is closed; 

‘‘(iv) the SBHC will be integrated into the school 

environment and will coordinate health services with 

school personnel, such as administrators, teachers, 
H. R. 3590—431 

nurses, counselors, and support personnel, as well as 

with other community providers co-located at the 

school; 

‘‘(v) the SBHC sponsoring facility assumes all 

responsibility for the SBHC administration, operations, 

and oversight; and 

‘‘(vi) the SBHC will comply with Federal, State, 

and local laws concerning patient privacy and student 

records, including regulations promulgated under the 

Health Insurance Portability and Accountability Act 

of 1996 and section 444 of the General Education Provisions Act; and 

‘‘(D) such other information as the Secretary may 

require. 

‘‘(d) PREFERENCES AND CONSIDERATION.—In reviewing applications: 

‘‘(1) The Secretary may give preference to applicants who 

demonstrate an ability to serve the following: 

‘‘(A) Communities that have evidenced barriers to primary health care and mental health and substance use 

disorder prevention services for children and adolescents. 

‘‘(B) Communities with high per capita numbers of 

children and adolescents who are uninsured, underinsured, 

or enrolled in public health insurance programs. 

‘‘(C) Populations of children and adolescents that have 

historically demonstrated difficulty in accessing health and 

mental health and substance use disorder prevention services. 

‘‘(2) The Secretary may give consideration to whether an 

applicant has received a grant under subsection (a) of section 

4101 of the Patient Protection and Affordable Care Act. 

‘‘(e) WAIVER OF REQUIREMENTS.—The Secretary may— 

‘‘(1) under appropriate circumstances, waive the application 

of all or part of the requirements of this subsection with respect 

to an SBHC for not to exceed 2 years; and 

‘‘(2) upon a showing of good cause, waive the requirement 

that the SBHC provide all required comprehensive primary 

health services for a designated period of time to be determined 

by the Secretary. 

‘‘(f) USE OF FUNDS.— 

‘‘(1) FUNDS.—Funds awarded under a grant under this 

section— 

‘‘(A) may be used for— 

‘‘(i) acquiring and leasing equipment (including the 

costs of amortizing the principle of, and paying interest 

on, loans for such equipment); 

‘‘(ii) providing training related to the provision of 

required comprehensive primary health services and 

additional health services; 

‘‘(iii) the management and operation of health 

center programs; 

‘‘(iv) the payment of salaries for physicians, nurses, 

and other personnel of the SBHC; and 

‘‘(B) may not be used to provide abortions. 

‘‘(2) CONSTRUCTION.—The Secretary may award grants 

which may be used to pay the costs associated with expanding 

and modernizing existing buildings for use as an SBHC, 
H. R. 3590—432 

including the purchase of trailers or manufactured buildings 

to install on the school property. 

‘‘(3) LIMITATIONS.— ‘‘(A) IN GENERAL.—Any provider of services that is 

determined by a State to be in violation of a State law 

described in subsection (a)(3)(B) with respect to activities 

carried out at a SBHC shall not be eligible to receive 

additional funding under this section. 

‘‘(B) NO OVERLAPPING GRANT PERIOD.—No entity that 

has received funding under section 330 for a grant period 

shall be eligible for a grant under this section for with 

respect to the same grant period. 

‘‘(g) MATCHING REQUIREMENT.— ‘‘(1) IN GENERAL.—Each eligible entity that receives a grant 

under this section shall provide, from non-Federal sources, 

an amount equal to 20 percent of the amount of the grant 

(which may be provided in cash or in-kind) to carry out the 

activities supported by the grant. 

‘‘(2) WAIVER.—The Secretary may waive all or part of the 

matching requirement described in paragraph (1) for any fiscal 

year for the SBHC if the Secretary determines that applying 

the matching requirement to the SBHC would result in serious 

hardship or an inability to carry out the purposes of this 

section. 

‘‘(h) SUPPLEMENT, NOT SUPPLANT.—Grant funds provided under 

this section shall be used to supplement, not supplant, other Federal 

or State funds. 

‘‘(i) EVALUATION.—The Secretary shall develop and implement 

a plan for evaluating SBHCs and monitoring quality performance 

under the awards made under this section. 

‘‘(j) AGE APPROPRIATE SERVICES.—An eligible entity receiving 

funds under this section shall only provide age appropriate services 

through a SBHC funded under this section to an individual. 

‘‘(k) PARENTAL CONSENT.—An eligible entity receiving funds 

under this section shall not provide services through a SBHC funded 

under this section to an individual without the consent of the 

parent or guardian of such individual if such individual is considered a minor under applicable State law. 

‘‘(l) AUTHORIZATION OF APPROPRIATIONS.—For purposes of carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of the fiscal years 2010 

through 2014.’’. 

SEC. 4102. ORAL HEALTHCARE PREVENTION ACTIVITIES. 

(a) IN GENERAL.—Title III of the Public Health Service Act 

(42 U.S.C. 241 et seq.), as amended by section 3025, is amended 

by adding at the end the following: 

‘‘PART T—ORAL HEALTHCARE PREVENTION 

ACTIVITIES 

‘‘SEC. 399LL. ORAL HEALTHCARE PREVENTION EDUCATION CAMPAIGN. 

‘‘(a) ESTABLISHMENT.—The Secretary, acting through the 

Director of the Centers for Disease Control and Prevention and 

in consultation with professional oral health organizations, shall, 

subject to the availability of appropriations, establish a 5-year 

national, public education campaign (referred to in this section 
H. R. 3590—433 

as the ‘campaign’) that is focused on oral healthcare prevention 

and education, including prevention of oral disease such as early 

childhood and other caries, periodontal disease, and oral cancer. 

‘‘(b) REQUIREMENTS.—In establishing the campaign, the Secretary shall— 

‘‘(1) ensure that activities are targeted towards specific 

populations such as children, pregnant women, parents, the 

elderly, individuals with disabilities, and ethnic and racial 

minority populations, including Indians, Alaska Natives and 

Native Hawaiians (as defined in section 4(c) of the Indian 

Health Care Improvement Act) in a culturally and linguistically 

appropriate manner; and 

‘‘(2) utilize science-based strategies to convey oral health 

prevention messages that include, but are not limited to, 

community water fluoridation and dental sealants. 

‘‘(c) PLANNING AND IMPLEMENTATION.—Not later than 2 years 

after the date of enactment of this section, the Secretary shall 

begin implementing the 5-year campaign. During the 2-year period 

referred to in the previous sentence, the Secretary shall conduct 

planning activities with respect to the campaign. 

‘‘SEC. 399LL–1. RESEARCH-BASED DENTAL CARIES DISEASE MANAGEMENT. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Director 

of the Centers for Disease Control and Prevention, shall award 

demonstration grants to eligible entities to demonstrate the 

effectiveness of research-based dental caries disease management 

activities. 

‘‘(b) ELIGIBILITY.—To be eligible for a grant under this section, 

an entity shall— 

‘‘(1) be a community-based provider of dental services (as 

defined by the Secretary), including a Federally-qualified health 

center, a clinic of a hospital owned or operated by a State 

(or by an instrumentality or a unit of government within a 

State), a State or local department of health, a dental program 

of the Indian Health Service, an Indian tribe or tribal organization, or an urban Indian organization (as such terms are defined 

in section 4 of the Indian Health Care Improvement Act), 

a health system provider, a private provider of dental services, 

medical, dental, public health, nursing, nutrition educational 

institutions, or national organizations involved in improving 

children’s oral health; and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require. 

‘‘(c) USE OF FUNDS.—A grantee shall use amounts received 

under a grant under this section to demonstrate the effectiveness 

of research-based dental caries disease management activities. 

‘‘(d) USE OF INFORMATION.—The Secretary shall utilize information generated from grantees under this section in planning and 

implementing the public education campaign under section 399LL. 

‘‘SEC. 399LL–2. AUTHORIZATION OF APPROPRIATIONS. 

‘‘There is authorized to be appropriated to carry out this part, 

such sums as may be necessary.’’. 

(b) SCHOOL-BASED SEALANT PROGRAMS.—Section 317M(c)(1) of 

the Public Health Service Act (42 U.S.C. 247b–14(c)(1)) is amended 

by striking ‘‘may award grants to States and Indian tribes’’ and 
H. R. 3590—434 

inserting ‘‘shall award a grant to each of the 50 States and territories and to Indians, Indian tribes, tribal organizations and urban 

Indian organizations (as such terms are defined in section 4 of 

the Indian Health Care Improvement Act)’’. 

(c) ORAL HEALTH INFRASTRUCTURE.—Section 317M of the Public 

Health Service Act (42 U.S.C. 247b–14) is amended— 

(1) by redesignating subsections (d) and (e) as subsections 

(e) and (f), respectively; and 

(2) by inserting after subsection (c), the following: 

‘‘(d) ORAL HEALTH INFRASTRUCTURE.— ‘‘(1) COOPERATIVE AGREEMENTS.—The Secretary, acting 

through the Director of the Centers for Disease Control and 

Prevention, shall enter into cooperative agreements with State, 

territorial, and Indian tribes or tribal organizations (as those 

terms are defined in section 4 of the Indian Health Care 

Improvement Act) to establish oral health leadership and program guidance, oral health data collection and interpretation, 

(including determinants of poor oral health among vulnerable 

populations), a multi-dimensional delivery system for oral 

health, and to implement science-based programs (including 

dental sealants and community water fluoridation) to improve 

oral health. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated such sums as necessary to carry out 

this subsection for fiscal years 2010 through 2014.’’. 

(d) UPDATING NATIONAL ORAL HEALTHCARE SURVEILLANCE

ACTIVITIES.— (1) PRAMS.— 

(A) IN GENERAL.—The Secretary of Health and Human 

Services (referred to in this subsection as the ‘‘Secretary’’) 

shall carry out activities to update and improve the Pregnancy Risk Assessment Monitoring System (referred to 

in this section as ‘‘PRAMS’’) as it relates to oral healthcare. 

(B) STATE REPORTS AND MANDATORY MEASUREMENTS.— (i) IN GENERAL.—Not later than 5 years after the 

date of enactment of this Act, and every 5 years thereafter, a State shall submit to the Secretary a report 

concerning activities conducted within the State under 

PRAMS. 

(ii) MEASUREMENTS.—The oral healthcare 

measurements developed by the Secretary for use 

under PRAMS shall be mandatory with respect to 

States for purposes of the State reports under clause 

(i). 

(C) FUNDING.—There is authorized to be appropriated 

to carry out this paragraph, such sums as may be necessary. 

(2) NATIONAL HEALTH AND NUTRITION EXAMINATION

SURVEY.—The Secretary shall develop oral healthcare components that shall include tooth-level surveillance for inclusion 

in the National Health and Nutrition Examination Survey. 

Such components shall be updated by the Secretary at least 

every 6 years. For purposes of this paragraph, the term ‘‘toothlevel surveillance’’ means a clinical examination where an 

examiner looks at each dental surface, on each tooth in the 

mouth and as expanded by the Division of Oral Health of 

the Centers for Disease Control and Prevention. 
H. R. 3590—435 

(3) MEDICAL EXPENDITURES PANEL SURVEY.—The Secretary 

shall ensure that the Medical Expenditures Panel Survey by 

the Agency for Healthcare Research and Quality includes the 

verification of dental utilization, expenditure, and coverage 

findings through conduct of a look-back analysis. 

(4) NATIONAL ORAL HEALTH SURVEILLANCE SYSTEM.— (A) APPROPRIATIONS.—There is authorized to be appropriated, such sums as may be necessary for each of fiscal 

years 2010 through 2014 to increase the participation of 

States in the National Oral Health Surveillance System 

from 16 States to all 50 States, territories, and District 

of Columbia. 

(B) REQUIREMENTS.—The Secretary shall ensure that 

the National Oral Health Surveillance System include the 

measurement of early childhood caries. 

SEC. 4103. MEDICARE COVERAGE OF ANNUAL WELLNESS VISIT PROVIDING A PERSONALIZED PREVENTION PLAN. 

(a) COVERAGE OF PERSONALIZED PREVENTION PLAN SERVICES.— (1) IN GENERAL.—Section 1861(s)(2) of the Social Security 

Act (42 U.S.C. 1395x(s)(2)) is amended— 

(A) in subparagraph (DD), by striking ‘‘and’’ at the 

end; 

(B) in subparagraph (EE), by adding ‘‘and’’ at the end; 

and 

(C) by adding at the end the following new subparagraph: 

‘‘(FF) personalized prevention plan services (as defined in 

subsection (hhh));’’. 

(2) CONFORMING AMENDMENTS.—Clauses (i) and (ii) of section 1861(s)(2)(K) of the Social Security Act (42 U.S.C. 

1395x(s)(2)(K)) are each amended by striking ‘‘subsection 

(ww)(1)’’ and inserting ‘‘subsections (ww)(1) and (hhh)’’. 

(b) PERSONALIZED PREVENTION PLAN SERVICES DEFINED.—Section 1861 of the Social Security Act (42 U.S.C. 1395x) is amended 

by adding at the end the following new subsection: 

‘‘Annual Wellness Visit 

‘‘(hhh)(1) The term ‘personalized prevention plan services’ 

means the creation of a plan for an individual— 

‘‘(A) that includes a health risk assessment (that meets 

the guidelines established by the Secretary under paragraph 

(4)(A)) of the individual that is completed prior to or as part 

of the same visit with a health professional described in paragraph (3); and 

‘‘(B) that— 

‘‘(i) takes into account the results of the health risk 

assessment; and 

‘‘(ii) may contain the elements described in paragraph 

(2). 

‘‘(2) Subject to paragraph (4)(H), the elements described in 

this paragraph are the following: 

‘‘(A) The establishment of, or an update to, the individual’s 

medical and family history. 

‘‘(B) A list of current providers and suppliers that are 

regularly involved in providing medical care to the individual 

(including a list of all prescribed medications). 
H. R. 3590—436 

‘‘(C) A measurement of height, weight, body mass index 

(or waist circumference, if appropriate), blood pressure, and 

other routine measurements. 

‘‘(D) Detection of any cognitive impairment. 

‘‘(E) The establishment of, or an update to, the following: 

‘‘(i) A screening schedule for the next 5 to 10 years, 

as appropriate, based on recommendations of the United 

States Preventive Services Task Force and the Advisory 

Committee on Immunization Practices, and the individual’s 

health status, screening history, and age-appropriate 

preventive services covered under this title. 

‘‘(ii) A list of risk factors and conditions for which 

primary, secondary, or tertiary prevention interventions 

are recommended or are underway, including any mental 

health conditions or any such risk factors or conditions 

that have been identified through an initial preventive 

physical examination (as described under subsection 

(ww)(1)), and a list of treatment options and their associated risks and benefits. 

‘‘(F) The furnishing of personalized health advice and a 

referral, as appropriate, to health education or preventive counseling services or programs aimed at reducing identified risk 

factors and improving self-management, or community-based 

lifestyle interventions to reduce health risks and promote selfmanagement and wellness, including weight loss, physical 

activity, smoking cessation, fall prevention, and nutrition. 

‘‘(G) Any other element determined appropriate by the 

Secretary. 

‘‘(3) A health professional described in this paragraph is— 

‘‘(A) a physician; 

‘‘(B) a practitioner described in clause (i) of section 

1842(b)(18)(C); or 

‘‘(C) a medical professional (including a health educator, 

registered dietitian, or nutrition professional) or a team of 

medical professionals, as determined appropriate by the Secretary, under the supervision of a physician. 

‘‘(4)(A) For purposes of paragraph (1)(A), the Secretary, not 

later than 1 year after the date of enactment of this subsection, 

shall establish publicly available guidelines for health risk assessments. Such guidelines shall be developed in consultation with 

relevant groups and entities and shall provide that a health risk 

assessment— 

‘‘(i) identify chronic diseases, injury risks, modifiable risk 

factors, and urgent health needs of the individual; and 

‘‘(ii) may be furnished— 

‘‘(I) through an interactive telephonic or web-based 

program that meets the standards established under 

subparagraph (B); 

‘‘(II) during an encounter with a health care professional; 

‘‘(III) through community-based prevention programs; 

or 

‘‘(IV) through any other means the Secretary determines appropriate to maximize accessibility and ease of 

use by beneficiaries, while ensuring the privacy of such 

beneficiaries. 
H. R. 3590—437 

‘‘(B) Not later than 1 year after the date of enactment of 

this subsection, the Secretary shall establish standards for interactive telephonic or web-based programs used to furnish health 

risk assessments under subparagraph (A)(ii)(I). The Secretary may 

utilize any health risk assessment developed under section 4004(f) 

of the Patient Protection and Affordable Care Act as part of the 

requirement to develop a personalized prevention plan to comply 

with this subparagraph. 

‘‘(C)(i) Not later than 18 months after the date of enactment 

of this subsection, the Secretary shall develop and make available 

to the public a health risk assessment model. Such model shall 

meet the guidelines under subparagraph (A) and may be used 

to meet the requirement under paragraph (1)(A). 

‘‘(ii) Any health risk assessment that meets the guidelines 

under subparagraph (A) and is approved by the Secretary may 

be used to meet the requirement under paragraph (1)(A). 

‘‘(D) The Secretary may coordinate with community-based entities (including State Health Insurance Programs, Area Agencies 

on Aging, Aging and Disability Resource Centers, and the Administration on Aging) to— 

‘‘(i) ensure that health risk assessments are accessible to 

beneficiaries; and 

‘‘(ii) provide appropriate support for the completion of 

health risk assessments by beneficiaries. 

‘‘(E) The Secretary shall establish procedures to make beneficiaries and providers aware of the requirement that a beneficiary 

complete a health risk assessment prior to or at the same time 

as receiving personalized prevention plan services. 

‘‘(F) To the extent practicable, the Secretary shall encourage 

the use of, integration with, and coordination of health information 

technology (including use of technology that is compatible with 

electronic medical records and personal health records) and may 

experiment with the use of personalized technology to aid in the 

development of self-management skills and management of and 

adherence to provider recommendations in order to improve the 

health status of beneficiaries. 

‘‘(G)(i) A beneficiary shall only be eligible to receive an initial 

preventive physical examination (as defined under subsection 

(ww)(1)) at any time during the 12-month period after the date 

that the beneficiary’s coverage begins under part B and shall be 

eligible to receive personalized prevention plan services under this 

subsection provided that the beneficiary has not received such services within the preceding 12-month period. 

‘‘(ii) The Secretary shall establish procedures to make beneficiaries aware of the option to select an initial preventive physical 

examination or personalized prevention plan services during the 

period of 12 months after the date that a beneficiary’s coverage 

begins under part B, which shall include information regarding 

any relevant differences between such services. 

‘‘(H) The Secretary shall issue guidance that— 

‘‘(i) identifies elements under paragraph (2) that are 

required to be provided to a beneficiary as part of their first 

visit for personalized prevention plan services; and 

‘‘(ii) establishes a yearly schedule for appropriate provision 

of such elements thereafter.’’. 

(c) PAYMENT AND ELIMINATION OF COST-SHARING.— 
H. R. 3590—438 

(1) PAYMENT AND ELIMINATION OF COINSURANCE.—Section 

1833(a)(1) of the Social Security Act (42 U.S.C. 1395l(a)(1)) 

is amended— 

(A) in subparagraph (N), by inserting ‘‘other than 

personalized prevention plan services (as defined in section 

1861(hhh)(1))’’ after ‘‘(as defined in section 1848(j)(3))’’; 

(B) by striking ‘‘and’’ before ‘‘(W)’’; and 

(C) by inserting before the semicolon at the end the 

following: ‘‘, and (X) with respect to personalized prevention 

plan services (as defined in section 1861(hhh)(1)), the 

amount paid shall be 100 percent of the lesser of the 

actual charge for the services or the amount determined 

under the payment basis determined under section 1848’’. 

(2) PAYMENT UNDER PHYSICIAN FEE SCHEDULE.—Section 

1848(j)(3) of the Social Security Act (42 U.S.C. 1395w–4(j)(3)) 

is amended by inserting ‘‘(2)(FF) (including administration of 

the health risk assessment) ,’’ after ‘‘(2)(EE),’’. 

(3) ELIMINATION OF COINSURANCE IN OUTPATIENT HOSPITAL

SETTINGS.— 

(A) EXCLUSION FROM OPD FEE SCHEDULE.—Section 

1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C. 

1395l(t)(1)(B)(iv)) is amended by striking ‘‘and diagnostic 

mammography’’ and inserting ‘‘, diagnostic mammography, 

or personalized prevention plan services (as defined in section 1861(hhh)(1))’’. 

(B) CONFORMING AMENDMENTS.—Section 1833(a)(2) of 

the Social Security Act (42 U.S.C. 1395l(a)(2)) is amended— 

(i) in subparagraph (F), by striking ‘‘and’’ at the 

end; 

(ii) in subparagraph (G)(ii), by striking the comma 

at the end and inserting ‘‘; and’’; and 

(iii) by inserting after subparagraph (G)(ii) the following new subparagraph: 

‘‘(H) with respect to personalized prevention plan services (as defined in section 1861(hhh)(1)) furnished by an 

outpatient department of a hospital, the amount determined under paragraph (1)(X),’’. 

(4) WAIVER OF APPLICATION OF DEDUCTIBLE.—The first sentence of section 1833(b) of the Social Security Act (42 U.S.C. 

1395l(b)) is amended— 

(A) by striking ‘‘and’’ before ‘‘(9)’’; and 

(B) by inserting before the period the following: ‘‘, 

and (10) such deductible shall not apply with respect to 

personalized prevention plan services (as defined in section 

1861(hhh)(1))’’. 

(d) FREQUENCY LIMITATION.—Section 1862(a) of the Social Security Act (42 U.S.C. 1395y(a)) is amended— 

(1) in paragraph (1)— 

(A) in subparagraph (N), by striking ‘‘and’’ at the end; 

(B) in subparagraph (O), by striking the semicolon 

at the end and inserting ‘‘, and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(P) in the case of personalized prevention plan services 

(as defined in section 1861(hhh)(1)), which are performed more 

frequently than is covered under such section;’’; and 
H. R. 3590—439 

(2) in paragraph (7), by striking ‘‘or (K)’’ and inserting 

‘‘(K), or (P)’’. 

(e) EFFECTIVE DATE.—The amendments made by this section 

shall apply to services furnished on or after January 1, 2011. 

SEC. 4104. REMOVAL OF BARRIERS TO PREVENTIVE SERVICES IN 

MEDICARE. 

(a) DEFINITION OF PREVENTIVE SERVICES.—Section 1861(ddd) 

of the Social Security Act (42 U.S.C. 1395x(ddd)) is amended— 

(1) in the heading, by inserting ‘‘; Preventive Services’’ 

after ‘‘Services’’; 

(2) in paragraph (1), by striking ‘‘not otherwise described 

in this title’’ and inserting ‘‘not described in subparagraph 

(A) or (C) of paragraph (3)’’; and 

(3) by adding at the end the following new paragraph: 

‘‘(3) The term ‘preventive services’ means the following: 

‘‘(A) The screening and preventive services described in 

subsection (ww)(2) (other than the service described in subparagraph (M) of such subsection). 

‘‘(B) An initial preventive physical examination (as defined 

in subsection (ww)). 

‘‘(C) Personalized prevention plan services (as defined in 

subsection (hhh)(1)).’’. 

(b) COINSURANCE.— 

(1) GENERAL APPLICATION.— 

(A) IN GENERAL.—Section 1833(a)(1) of the Social Security Act (42 U.S.C. 1395l(a)(1)), as amended by section 

4103(c)(1), is amended— 

(i) in subparagraph (T), by inserting ‘‘(or 100 percent if such services are recommended with a grade 

of A or B by the United States Preventive Services 

Task Force for any indication or population and are 

appropriate for the individual)’’ after ‘‘80 percent’’; 

(ii) in subparagraph (W)— 

(I) in clause (i), by inserting ‘‘(if such subparagraph were applied, by substituting ‘100 percent’ 

for ‘80 percent’)’’ after ‘‘subparagraph (D)’’; and 

(II) in clause (ii), by striking ‘‘80 percent’’ and 

inserting ‘‘100 percent’’; 

(iii) by striking ‘‘and’’ before ‘‘(X)’’; and 

(iv) by inserting before the semicolon at the end 

the following: ‘‘, and (Y) with respect to preventive 

services described in subparagraphs (A) and (B) of 

section 1861(ddd)(3) that are appropriate for the individual and, in the case of such services described in 

subparagraph (A), are recommended with a grade of 

A or B by the United States Preventive Services Task 

Force for any indication or population, the amount 

paid shall be 100 percent of the lesser of the actual 

charge for the services or the amount determined under 

the fee schedule that applies to such services under 

this part’’. 

(2) ELIMINATION OF COINSURANCE IN OUTPATIENT HOSPITAL

SETTINGS.— 

(A) EXCLUSION FROM OPD FEE SCHEDULE.—Section 

1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C. 
H. R. 3590—440 

1395l(t)(1)(B)(iv)), as amended by section 4103(c)(3)(A), is 

amended— 

(i) by striking ‘‘or’’ before ‘‘personalized prevention 

plan services’’; and 

(ii) by inserting before the period the following: 

‘‘, or preventive services described in subparagraphs 

(A) and (B) of section 1861(ddd)(3) that are appropriate 

for the individual and, in the case of such services 

described in subparagraph (A), are recommended with 

a grade of A or B by the United States Preventive 

Services Task Force for any indication or population’’. 

(B) CONFORMING AMENDMENTS.—Section 1833(a)(2) of 

the Social Security Act (42 U.S.C. 1395l(a)(2)), as amended 

by section 4103(c)(3)(B), is amended— 

(i) in subparagraph (G)(ii), by striking ‘‘and’’ after 

the semicolon at the end; 

(ii) in subparagraph (H), by striking the comma 

at the end and inserting ‘‘; and’’; and 

(iii) by inserting after subparagraph (H) the following new subparagraph: 

‘‘(I) with respect to preventive services described in 

subparagraphs (A) and (B) of section 1861(ddd)(3) that 

are appropriate for the individual and are furnished by 

an outpatient department of a hospital and, in the case 

of such services described in subparagraph (A), are recommended with a grade of A or B by the United States 

Preventive Services Task Force for any indication or population, the amount determined under paragraph (1)(W) or 

(1)(Y),’’. 

(c) WAIVER OF APPLICATION OF DEDUCTIBLE FOR PREVENTIVE

SERVICES AND COLORECTAL CANCER SCREENING TESTS.—Section 

1833(b) of the Social Security Act (42 U.S.C. 1395l(b)), as amended 

by section 4103(c)(4), is amended— 

(1) in paragraph (1), by striking ‘‘items and services 

described in section 1861(s)(10)(A)’’ and inserting ‘‘preventive 

services described in subparagraph (A) of section 1861(ddd)(3) 

that are recommended with a grade of A or B by the United 

States Preventive Services Task Force for any indication or 

population and are appropriate for the individual.’’; and 

(2) by adding at the end the following new sentence: ‘‘Paragraph (1) of the first sentence of this subsection shall apply 

with respect to a colorectal cancer screening test regardless 

of the code that is billed for the establishment of a diagnosis 

as a result of the test, or for the removal of tissue or other 

matter or other procedure that is furnished in connection with, 

as a result of, and in the same clinical encounter as the 

screening test.’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to items and services furnished on or after January 

1, 2011. 

SEC. 4105. EVIDENCE-BASED COVERAGE OF PREVENTIVE SERVICES 

IN MEDICARE. 

(a) AUTHORITY TO MODIFY OR ELIMINATE COVERAGE OF CERTAIN

PREVENTIVE SERVICES.—Section 1834 of the Social Security Act 

(42 U.S.C. 1395m) is amended by adding at the end the following 

new subsection: 
H. R. 3590—441 

‘‘(n) AUTHORITY TO MODIFY OR ELIMINATE COVERAGE OF CERTAIN PREVENTIVE SERVICES.—Notwithstanding any other provision 

of this title, effective beginning on January 1, 2010, if the Secretary 

determines appropriate, the Secretary may— 

‘‘(1) modify— 

‘‘(A) the coverage of any preventive service described 

in subparagraph (A) of section 1861(ddd)(3) to the extent 

that such modification is consistent with the recommendations of the United States Preventive Services Task Force; 

and 

‘‘(B) the services included in the initial preventive physical examination described in subparagraph (B) of such 

section; and 

‘‘(2) provide that no payment shall be made under this 

title for a preventive service described in subparagraph (A) 

of such section that has not received a grade of A, B, C, 

or I by such Task Force.’’. 

(b) CONSTRUCTION.—Nothing in the amendment made by paragraph (1) shall be construed to affect the coverage of diagnostic 

or treatment services under title XVIII of the Social Security Act. 

SEC. 4106. IMPROVING ACCESS TO PREVENTIVE SERVICES FOR 

ELIGIBLE ADULTS IN MEDICAID. 

(a) CLARIFICATION OF INCLUSION OF SERVICES.—Section 

1905(a)(13) of the Social Security Act (42 U.S.C. 1396d(a)(13)) is 

amended to read as follows: 

‘‘(13) other diagnostic, screening, preventive, and rehabilitative services, including— 

‘‘(A) any clinical preventive services that are assigned 

a grade of A or B by the United States Preventive Services 

Task Force; 

‘‘(B) with respect to an adult individual, approved vaccines recommended by the Advisory Committee on 

Immunization Practices (an advisory committee established 

by the Secretary, acting through the Director of the Centers 

for Disease Control and Prevention) and their administration; and 

‘‘(C) any medical or remedial services (provided in a 

facility, a home, or other setting) recommended by a physician or other licensed practitioner of the healing arts within 

the scope of their practice under State law, for the maximum reduction of physical or mental disability and restoration of an individual to the best possible functional 

level;’’. 

(b) INCREASED FMAP.—Section 1905(b) of the Social Security 

Act (42 U.S.C. 1396d(b)), as amended by sections 2001(a)(3)(A) 

and 2004(c)(1), is amended in the first sentence— 

(1) by striking ‘‘, and (4)’’ and inserting ‘‘, (4)’’; and 

(2) by inserting before the period the following: ‘‘, and 

(5) in the case of a State that provides medical assistance 

for services and vaccines described in subparagraphs (A) and 

(B) of subsection (a)(13), and prohibits cost-sharing for such 

services and vaccines, the Federal medical assistance percentage, as determined under this subsection and subsection (y) 

(without regard to paragraph (1)(C) of such subsection), shall 

be increased by 1 percentage point with respect to medical 
H. R. 3590—442 

assistance for such services and vaccines and for items and 

services described in subsection (a)(4)(D)’’. 

(c) EFFECTIVE DATE.—The amendments made under this section 

shall take effect on January 1, 2013. 

SEC. 4107. COVERAGE OF COMPREHENSIVE TOBACCO CESSATION 

SERVICES FOR PREGNANT WOMEN IN MEDICAID. 

(a) REQUIRING COVERAGE OF COUNSELING AND

PHARMACOTHERAPY FOR CESSATION OF TOBACCO USE BY PREGNANT

WOMEN.—Section 1905 of the Social Security Act (42 U.S.C. 1396d), 

as amended by sections 2001(a)(3)(B) and 2303, is further 

amended— 

(1) in subsection (a)(4)— 

(A) by striking ‘‘and’’ before ‘‘(C)’’; and 

(B) by inserting before the semicolon at the end the 

following new subparagraph: ‘‘; and (D) counseling and 

pharmacotherapy for cessation of tobacco use by pregnant 

women (as defined in subsection (bb))’’; and 

(2) by adding at the end the following: 

‘‘(bb)(1) For purposes of this title, the term ‘counseling and 

pharmacotherapy for cessation of tobacco use by pregnant women’ 

means diagnostic, therapy, and counseling services and 

pharmacotherapy (including the coverage of prescription and nonprescription tobacco cessation agents approved by the Food and 

Drug Administration) for cessation of tobacco use by pregnant 

women who use tobacco products or who are being treated for 

tobacco use that is furnished— 

‘‘(A) by or under the supervision of a physician; or 

‘‘(B) by any other health care professional who— 

‘‘(i) is legally authorized to furnish such services under 

State law (or the State regulatory mechanism provided 

by State law) of the State in which the services are furnished; and 

‘‘(ii) is authorized to receive payment for other services 

under this title or is designated by the Secretary for this 

purpose. 

‘‘(2) Subject to paragraph (3), such term is limited to— 

‘‘(A) services recommended with respect to pregnant women 

in ‘Treating Tobacco Use and Dependence: 2008 Update: A 

Clinical Practice Guideline’, published by the Public Health 

Service in May 2008, or any subsequent modification of such 

Guideline; and 

‘‘(B) such other services that the Secretary recognizes to 

be effective for cessation of tobacco use by pregnant women. 

‘‘(3) Such term shall not include coverage for drugs or biologicals 

that are not otherwise covered under this title.’’. 

(b) EXCEPTION FROM OPTIONAL RESTRICTION UNDER MEDICAID

PRESCRIPTION DRUG COVERAGE.—Section 1927(d)(2)(F) of the Social 

Security Act (42 U.S.C. 1396r–8(d)(2)(F)), as redesignated by section 

2502(a), is amended by inserting before the period at the end 

the following: ‘‘, except, in the case of pregnant women when recommended in accordance with the Guideline referred to in section 

1905(bb)(2)(A), agents approved by the Food and Drug Administration under the over-the-counter monograph process for purposes 

of promoting, and when used to promote, tobacco cessation’’. 
H. R. 3590—443 

(c) REMOVAL OF COST-SHARING FOR COUNSELING AND

PHARMACOTHERAPY FOR CESSATION OF TOBACCO USE BY PREGNANT

WOMEN.— 

(1) GENERAL COST-SHARING LIMITATIONS.—Section 1916 of 

the Social Security Act (42 U.S.C. 1396o) is amended in each 

of subsections (a)(2)(B) and (b)(2)(B) by inserting ‘‘, and counseling and pharmacotherapy for cessation of tobacco use by 

pregnant women (as defined in section 1905(bb)) and covered 

outpatient drugs (as defined in subsection (k)(2) of section 

1927 and including nonprescription drugs described in subsection (d)(2) of such section) that are prescribed for purposes 

of promoting, and when used to promote, tobacco cessation 

by pregnant women in accordance with the Guideline referred 

to in section 1905(bb)(2)(A)’’ after ‘‘complicate the pregnancy’’. 

(2) APPLICATION TO ALTERNATIVE COST-SHARING.—Section 

1916A(b)(3)(B)(iii) of such Act (42 U.S.C. 1396o–1(b)(3)(B)(iii)) 

is amended by inserting ‘‘, and counseling and pharmacotherapy 

for cessation of tobacco use by pregnant women (as defined 

in section 1905(bb))’’ after ‘‘complicate the pregnancy’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall take effect on October 1, 2010. 

SEC. 4108. INCENTIVES FOR PREVENTION OF CHRONIC DISEASES IN 

MEDICAID. 

(a) INITIATIVES.— (1) ESTABLISHMENT.— 

(A) IN GENERAL.—The Secretary shall award grants 

to States to carry out initiatives to provide incentives to 

Medicaid beneficiaries who— 

(i) successfully participate in a program described 

in paragraph (3); and 

(ii) upon completion of such participation, demonstrate changes in health risk and outcomes, 

including the adoption and maintenance of healthy 

behaviors by meeting specific targets (as described in 

subsection (c)(2)). 

(B) PURPOSE.—The purpose of the initiatives under 

this section is to test approaches that may encourage 

behavior modification and determine scalable solutions. 

(2) DURATION.— 

(A) INITIATION OF PROGRAM; RESOURCES.—The Secretary shall awards grants to States beginning on January 

1, 2011, or beginning on the date on which the Secretary 

develops program criteria, whichever is earlier. The Secretary shall develop program criteria for initiatives under 

this section using relevant evidence-based research and 

resources, including the Guide to Community Preventive 

Services, the Guide to Clinical Preventive Services, and 

the National Registry of Evidence-Based Programs and 

Practices. 

(B) DURATION OF PROGRAM.—A State awarded a grant 

to carry out initiatives under this section shall carry out 

such initiatives within the 5-year period beginning on 

January 1, 2011, or beginning on the date on which the 

Secretary develops program criteria, whichever is earlier. 

Initiatives under this section shall be carried out by a 

State for a period of not less than 3 years. 
H. R. 3590—444 

(3) PROGRAM DESCRIBED.— 

(A) IN GENERAL.—A program described in this paragraph is a comprehensive, evidence-based, widely available, 

and easily accessible program, proposed by the State and 

approved by the Secretary, that is designed and uniquely 

suited to address the needs of Medicaid beneficiaries and 

has demonstrated success in helping individuals achieve 

one or more of the following: 

(i) Ceasing use of tobacco products. 

(ii) Controlling or reducing their weight. 

(iii) Lowering their cholesterol. 

(iv) Lowering their blood pressure. 

(v) Avoiding the onset of diabetes or, in the case 

of a diabetic, improving the management of that condition. 

(B) CO-MORBIDITIES.—A program under this section 

may also address co-morbidities (including depression) that 

are related to any of the conditions described in subparagraph (A). 

(C) WAIVER AUTHORITY.—The Secretary may waive the 

requirements of section 1902(a)(1) (relating to 

statewideness) of the Social Security Act for a State 

awarded a grant to conduct an initiative under this section 

and shall ensure that a State makes any program described 

in subparagraph (A) available and accessible to Medicaid 

beneficiaries. 

(D) FLEXIBILITY IN IMPLEMENTATION.—A State may 

enter into arrangements with providers participating in 

Medicaid, community-based organizations, faith-based 

organizations, public-private partnerships, Indian tribes, 

or similar entities or organizations to carry out programs 

described in subparagraph (A). 

(4) APPLICATION.—Following the development of program 

criteria by the Secretary, a State may submit an application, 

in such manner and containing such information as the Secretary may require, that shall include a proposal for programs 

described in paragraph (3)(A) and a plan to make Medicaid 

beneficiaries and providers participating in Medicaid who reside 

in the State aware and informed about such programs. 

(b) EDUCATION AND OUTREACH CAMPAIGN.— 

(1) STATE AWARENESS.—The Secretary shall conduct an 

outreach and education campaign to make States aware of 

the grants under this section. 

(2) PROVIDER AND BENEFICIARY EDUCATION.—A State 

awarded a grant to conduct an initiative under this section 

shall conduct an outreach and education campaign to make 

Medicaid beneficiaries and providers participating in Medicaid 

who reside in the State aware of the programs described in 

subsection (a)(3) that are to be carried out by the State under 

the grant. 

(c) IMPACT.—A State awarded a grant to conduct an initiative 

under this section shall develop and implement a system to— 

(1) track Medicaid beneficiary participation in the program 

and validate changes in health risk and outcomes with clinical 

data, including the adoption and maintenance of health behaviors by such beneficiaries; 
H. R. 3590—445 

(2) to the extent practicable, establish standards and health 

status targets for Medicaid beneficiaries participating in the 

program and measure the degree to which such standards 

and targets are met; 

(3) evaluate the effectiveness of the program and provide 

the Secretary with such evaluations; 

(4) report to the Secretary on processes that have been 

developed and lessons learned from the program; and 

(5) report on preventive services as part of reporting on 

quality measures for Medicaid managed care programs. 

(d) EVALUATIONS AND REPORTS.— 

(1) INDEPENDENT ASSESSMENT.—The Secretary shall enter 

into a contract with an independent entity or organization 

to conduct an evaluation and assessment of the initiatives 

carried out by States under this section, for the purpose of 

determining— 

(A) the effect of such initiatives on the use of health 

care services by Medicaid beneficiaries participating in the 

program; 

(B) the extent to which special populations (including 

adults with disabilities, adults with chronic illnesses, and 

children with special health care needs) are able to participate in the program; 

(C) the level of satisfaction of Medicaid beneficiaries 

with respect to the accessibility and quality of health care 

services provided through the program; and 

(D) the administrative costs incurred by State agencies 

that are responsible for administration of the program. 

(2) STATE REPORTING.—A State awarded a grant to carry 

out initiatives under this section shall submit reports to the 

Secretary, on a semi-annual basis, regarding the programs 

that are supported by the grant funds. Such report shall include 

information, as specified by the Secretary, regarding— 

(A) the specific uses of the grant funds; 

(B) an assessment of program implementation and lessons learned from the programs; 

(C) an assessment of quality improvements and clinical 

outcomes under such programs; and 

(D) estimates of cost savings resulting from such programs. 

(3) INITIAL REPORT.—Not later than January 1, 2014, the 

Secretary shall submit to Congress an initial report on such 

initiatives based on information provided by States through 

reports required under paragraph (2). The initial report shall 

include an interim evaluation of the effectiveness of the initiatives carried out with grants awarded under this section and 

a recommendation regarding whether funding for expanding 

or extending the initiatives should be extended beyond January 

1, 2016. 

(4) FINAL REPORT.—Not later than July 1, 2016, the Secretary shall submit to Congress a final report on the program 

that includes the results of the independent assessment 

required under paragraph (1), together with recommendations 

for such legislation and administrative action as the Secretary 

determines appropriate. 
H. R. 3590—446 

(e) NO EFFECT ON ELIGIBILITY FOR, OR AMOUNT OF, MEDICAID

OR OTHER BENEFITS.—Any incentives provided to a Medicaid beneficiary participating in a program described in subsection (a)(3) 

shall not be taken into account for purposes of determining the 

beneficiary’s eligibility for, or amount of, benefits under the Medicaid program or any program funded in whole or in part with 

Federal funds. 

(f) FUNDING.—Out of any funds in the Treasury not otherwise 

appropriated, there are appropriated for the 5-year period beginning 

on January 1, 2011, $100,000,000 to the Secretary to carry out 

this section. Amounts appropriated under this subsection shall 

remain available until expended. 

(g) DEFINITIONS.—In this section: 

(1) MEDICAID BENEFICIARY.—The term ‘‘Medicaid beneficiary’’ means an individual who is eligible for medical assistance under a State plan or waiver under title XIX of the 

Social Security Act (42 U.S.C. 1396 et seq.) and is enrolled 

in such plan or waiver. 

(2) STATE.—The term ‘‘State’’ has the meaning given that 

term for purposes of title XIX of the Social Security Act (42 

U.S.C. 1396 et seq.). 

Subtitle C—Creating Healthier 

Communities 

SEC. 4201. COMMUNITY TRANSFORMATION GRANTS. 

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

(referred to in this section as the ‘‘Secretary’’), acting through the 

Director of the Centers for Disease Control and Prevention (referred 

to in this section as the ‘‘Director’’), shall award competitive grants 

to State and local governmental agencies and community-based 

organizations for the implementation, evaluation, and dissemination 

of evidence-based community preventive health activities in order 

to reduce chronic disease rates, prevent the development of secondary conditions, address health disparities, and develop a 

stronger evidence-base of effective prevention programming. 

(b) ELIGIBILITY.—To be eligible to receive a grant under subsection (a), an entity shall— 

(1) be— 

(A) a State governmental agency; 

(B) a local governmental agency; 

(C) a national network of community-based organizations; 

(D) a State or local non-profit organization; or 

(E) an Indian tribe; and 

(2) submit to the Director an application at such time, 

in such a manner, and containing such information as the 

Director may require, including a description of the program 

to be carried out under the grant; and 

(3) demonstrate a history or capacity, if funded, to develop 

relationships necessary to engage key stakeholders from multiple sectors within and beyond health care and across a 

community, such as healthy futures corps and health care 

providers. 

(c) USE OF FUNDS.— 
H. R. 3590—447 

(1) IN GENERAL.—An eligible entity shall use amounts 

received under a grant under this section to carry out programs 

described in this subsection. 

(2) COMMUNITY TRANSFORMATION PLAN.— 

(A) IN GENERAL.—An eligible entity that receives a 

grant under this section shall submit to the Director (for 

approval) a detailed plan that includes the policy, environmental, programmatic, and as appropriate infrastructure 

changes needed to promote healthy living and reduce 

disparities. 

(B) ACTIVITIES.—Activities within the plan may focus 

on (but not be limited to)— 

(i) creating healthier school environments, 

including increasing healthy food options, physical 

activity opportunities, promotion of healthy lifestyle, 

emotional wellness, and prevention curricula, and 

activities to prevent chronic diseases; 

(ii) creating the infrastructure to support active 

living and access to nutritious foods in a safe environment; 

(iii) developing and promoting programs targeting 

a variety of age levels to increase access to nutrition, 

physical activity and smoking cessation, improve social 

and emotional wellness, enhance safety in a community, or address any other chronic disease priority area 

identified by the grantee; 

(iv) assessing and implementing worksite wellness 

programming and incentives; 

(v) working to highlight healthy options at restaurants and other food venues; 

(vi) prioritizing strategies to reduce racial and 

ethnic disparities, including social, economic, and 

geographic determinants of health; and 

(vii) addressing special populations needs, 

including all age groups and individuals with disabilities, and individuals in both urban and rural areas. 

(3) COMMUNITY-BASED PREVENTION HEALTH ACTIVITIES.— (A) IN GENERAL.—An eligible entity shall use amounts 

received under a grant under this section to implement 

a variety of programs, policies, and infrastructure improvements to promote healthier lifestyles. 

(B) ACTIVITIES.—An eligible entity shall implement 

activities detailed in the community transformation plan 

under paragraph (2). 

(C) IN-KIND SUPPORT.—An eligible entity may provide 

in-kind resources such as staff, equipment, or office space 

in carrying out activities under this section. 

(4) EVALUATION.— (A) IN GENERAL.—An eligible entity shall use amounts 

provided under a grant under this section to conduct activities to measure changes in the prevalence of chronic disease 

risk factors among community members participating in 

preventive health activities 

(B) TYPES OF MEASURES.—In carrying out subparagraph (A), the eligible entity shall, with respect to residents 

in the community, measure— 

(i) changes in weight; 
H. R. 3590—448 

(ii) changes in proper nutrition; 

(iii) changes in physical activity; 

(iv) changes in tobacco use prevalence; 

(v) changes in emotional well-being and overall 

mental health; 

(vi) other factors using community-specific data 

from the Behavioral Risk Factor Surveillance Survey; 

and 

(vii) other factors as determined by the Secretary. 

(C) REPORTING.—An eligible entity shall annually 

submit to the Director a report containing an evaluation 

of activities carried out under the grant. 

(5) DISSEMINATION.—A grantee under this section shall— 

(A) meet at least annually in regional or national 

meetings to discuss challenges, best practices, and lessons 

learned with respect to activities carried out under the 

grant; and 

(B) develop models for the replication of successful 

programs and activities and the mentoring of other eligible 

entities. 

(d) TRAINING.— 

(1) IN GENERAL.—The Director shall develop a program 

to provide training for eligible entities on effective strategies 

for the prevention and control of chronic disease and the link 

between physical, emotional, and social well-being. 

(2) COMMUNITY TRANSFORMATION PLAN.—The Director shall 

provide appropriate feedback and technical assistance to 

grantees to establish community transformation plans 

(3) EVALUATION.—The Director shall provide a literature 

review and framework for the evaluation of programs conducted 

as part of the grant program under this section, in addition 

to working with academic institutions or other entities with 

expertise in outcome evaluation. 

(e) PROHIBITION.—A grantee shall not use funds provided under 

a grant under this section to create video games or to carry out 

any other activities that may lead to higher rates of obesity or 

inactivity. 

(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section, such sums as may 

be necessary for each fiscal years 2010 through 2014. 

SEC. 4202. HEALTHY AGING, LIVING WELL; EVALUATION OF COMMUNITY-BASED PREVENTION AND WELLNESS PROGRAMS 

FOR MEDICARE BENEFICIARIES. 

(a) HEALTHY AGING, LIVING WELL.— 

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

Services (referred to in this section as the ‘‘Secretary’’), acting 

through the Director of the Centers for Disease Control and 

Prevention, shall award grants to State or local health departments and Indian tribes to carry out 5-year pilot programs 

to provide public health community interventions, screenings, 

and where necessary, clinical referrals for individuals who are 

between 55 and 64 years of age. 

(2) ELIGIBILITY.—To be eligible to receive a grant under 

paragraph (1), an entity shall— 

(A) be— 

(i) a State health department; 
H. R. 3590—449 

(ii) a local health department; or 

(iii) an Indian tribe; 

(B) submit to the Secretary an application at such 

time, in such manner, and containing such information 

as the Secretary may require including a description of 

the program to be carried out under the grant; 

(C) design a strategy for improving the health of the 

55-to-64 year-old population through community-based 

public health interventions; and 

(D) demonstrate the capacity, if funded, to develop 

the relationships necessary with relevant health agencies, 

health care providers, community-based organizations, and 

insurers to carry out the activities described in paragraph 

(3), such relationships to include the identification of a 

community-based clinical partner, such as a community 

health center or rural health clinic. 

(3) USE OF FUNDS.— 

(A) IN GENERAL.—A State or local health department 

shall use amounts received under a grant under this subsection to carry out a program to provide the services 

described in this paragraph to individuals who are between 

55 and 64 years of age. 

(B) PUBLIC HEALTH INTERVENTIONS.— 

(i) IN GENERAL.—In developing and implementing 

such activities, a grantee shall collaborate with the 

Centers for Disease Control and Prevention and the 

Administration on Aging, and relevant local agencies 

and organizations. 

(ii) TYPES OF INTERVENTION ACTIVITIES.—Intervention activities conducted under this subparagraph may 

include efforts to improve nutrition, increase physical 

activity, reduce tobacco use and substance abuse, 

improve mental health, and promote healthy lifestyles 

among the target population. 

(C) COMMUNITY PREVENTIVE SCREENINGS.— 

(i) IN GENERAL.—In addition to community-wide 

public health interventions, a State or local health 

department shall use amounts received under a grant 

under this subsection to conduct ongoing health 

screening to identify risk factors for cardiovascular 

disease, cancer, stroke, and diabetes among individuals 

in both urban and rural areas who are between 55 

and 64 years of age. 

(ii) TYPES OF SCREENING ACTIVITIES.—Screening 

activities conducted under this subparagraph may 

include— 

(I) mental health/behavioral health and substance use disorders; 

(II) physical activity, smoking, and nutrition; 

and 

(III) any other measures deemed appropriate 

by the Secretary. 

(iii) MONITORING.—Grantees under this section 

shall maintain records of screening results under this 

subparagraph to establish the baseline data for monitoring the targeted population 
H. R. 3590—450 

(D) CLINICAL REFERRAL/TREATMENT FOR CHRONIC DISEASES.— 

(i) IN GENERAL.—A State or local health department shall use amounts received under a grant under 

this subsection to ensure that individuals between 55 

and 64 years of age who are found to have chronic 

disease risk factors through the screening activities 

described in subparagraph (C)(ii), receive clinical 

referral/treatment for follow-up services to reduce such 

risk. 

(ii) MECHANISM.— (I) IDENTIFICATION AND DETERMINATION OF

STATUS.—With respect to each individual with risk 

factors for or having heart disease, stroke, 

diabetes, or any other condition for which such 

individual was screened under subparagraph (C), 

a grantee under this section shall determine 

whether or not such individual is covered under 

any public or private health insurance program. 

(II) INSURED INDIVIDUALS.—An individual 

determined to be covered under a health insurance 

program under subclause (I) shall be referred by 

the grantee to the existing providers under such 

program or, if such individual does not have a 

current provider, to a provider who is in-network 

with respect to the program involved. 

(III) UNINSURED INDIVIDUALS.—With respect 

to an individual determined to be uninsured under 

subclause (I), the grantee’s community-based clinical partner described in paragraph (4)(D) shall 

assist the individual in determining eligibility for 

available public coverage options and identify other 

appropriate community health care resources and 

assistance programs. 

(iii) PUBLIC HEALTH INTERVENTION PROGRAM.—A 

State or local health department shall use amounts 

received under a grant under this subsection to enter 

into contracts with community health centers or rural 

health clinics and mental health and substance use 

disorder service providers to assist in the referral/treatment of at risk patients to community resources for 

clinical follow-up and help determine eligibility for 

other public programs. 

(E) GRANTEE EVALUATION.—An eligible entity shall use 

amounts provided under a grant under this subsection 

to conduct activities to measure changes in the prevalence 

of chronic disease risk factors among participants. 

(4) PILOT PROGRAM EVALUATION.—The Secretary shall conduct an annual evaluation of the effectiveness of the pilot 

program under this subsection. In determining such effectiveness, the Secretary shall consider changes in the prevalence 

of uncontrolled chronic disease risk factors among new Medicare 

enrollees (or individuals nearing enrollment, including those 

who are 63 and 64 years of age) who reside in States or 

localities receiving grants under this section as compared with 

national and historical data for those States and localities 

for the same population. 
H. R. 3590—451 

(5) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to carry out this subsection, such sums 

as may be necessary for each of fiscal years 2010 through 

2014. 

(b) EVALUATION AND PLAN FOR COMMUNITY-BASED PREVENTION

AND WELLNESS PROGRAMS FOR MEDICARE BENEFICIARIES.— 

(1) IN GENERAL.—The Secretary shall conduct an evaluation 

of community-based prevention and wellness programs and 

develop a plan for promoting healthy lifestyles and chronic 

disease self-management for Medicare beneficiaries. 

(2) MEDICARE EVALUATION OF PREVENTION AND WELLNESS

PROGRAMS.— 

(A) IN GENERAL.—The Secretary shall evaluate community prevention and wellness programs including those that 

are sponsored by the Administration on Aging, are evidence-based, and have demonstrated potential to help 

Medicare beneficiaries (particularly beneficiaries that have 

attained 65 years of age) reduce their risk of disease, 

disability, and injury by making healthy lifestyle choices, 

including exercise, diet, and self-management of chronic 

diseases. 

(B) EVALUATION.—The evaluation under subparagraph 

(A) shall consist of the following: 

(i) EVIDENCE REVIEW.—The Secretary shall review 

available evidence, literature, best practices, and 

resources that are relevant to programs that promote 

healthy lifestyles and reduce risk factors for the Medicare population. The Secretary may determine the 

scope of the evidence review and such issues to be 

considered, which shall include, at a minimum— 

(I) physical activity, nutrition, and obesity; 

(II) falls; 

(III) chronic disease self-management; and 

(IV) mental health. 

(ii) INDEPENDENT EVALUATION OF EVIDENCE-BASED

COMMUNITY PREVENTION AND WELLNESS PROGRAMS.— The Administrator of the Centers for Medicare & Medicaid Services, in consultation with the Assistant Secretary for Aging, shall, to the extent feasible and practicable, conduct an evaluation of existing community 

prevention and wellness programs that are sponsored 

by the Administration on Aging to assess the extent 

to which Medicare beneficiaries who participate in such 

programs— 

(I) reduce their health risks, improve their 

health outcomes, and adopt and maintain healthy 

behaviors; 

(II) improve their ability to manage their 

chronic conditions; and 

(III) reduce their utilization of health services 

and associated costs under the Medicare program 

for conditions that are amenable to improvement 

under such programs. 

(3) REPORT.—Not later than September 30, 2013, the Secretary shall submit to Congress a report that includes— 

(A) recommendations for such legislation and administrative action as the Secretary determines appropriate to 
H. R. 3590—452 

promote healthy lifestyles and chronic disease self-management for Medicare beneficiaries; 

(B) any relevant findings relating to the evidence 

review under paragraph (2)(B)(i); and 

(C) the results of the evaluation under paragraph 

(2)(B)(ii). 

(4) FUNDING.—For purposes of carrying out this subsection, 

the Secretary shall provide for the transfer, from the Federal 

Hospital Insurance Trust Fund under section 1817 of the Social 

Security Act (42 U.S.C. 1395i) and the Federal Supplemental 

Medical Insurance Trust Fund under section 1841 of such Act 

(42 U.S.C. 1395t), in such proportion as the Secretary determines appropriate, of $50,000,000 to the Centers for Medicare 

& Medicaid Services Program Management Account. Amounts 

transferred under the preceding sentence shall remain available 

until expended. 

(5) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code shall not apply to the this subsection. 

(6) MEDICARE BENEFICIARY.—In this subsection, the term 

‘‘Medicare beneficiary’’ means an individual who is entitled 

to benefits under part A of title XVIII of the Social Security 

Act and enrolled under part B of such title. 

SEC. 4203. REMOVING BARRIERS AND IMPROVING ACCESS TO 

WELLNESS FOR INDIVIDUALS WITH DISABILITIES. 

Title V of the Rehabilitation Act of 1973 (29 U.S.C. 791 et 

seq.) is amended by adding at the end of the following: 

‘‘SEC. 510. ESTABLISHMENT OF STANDARDS FOR ACCESSIBLE MEDICAL DIAGNOSTIC EQUIPMENT. 

‘‘(a) STANDARDS.—Not later than 24 months after the date 

of enactment of the Affordable Health Choices Act, the Architectural 

and Transportation Barriers Compliance Board shall, in consultation with the Commissioner of the Food and Drug Administration, 

promulgate regulatory standards in accordance with the Administrative Procedure Act (2 U.S.C. 551 et seq.) setting forth the minimum technical criteria for medical diagnostic equipment used in 

(or in conjunction with) physician’s offices, clinics, emergency rooms, 

hospitals, and other medical settings. The standards shall ensure 

that such equipment is accessible to, and usable by, individuals 

with accessibility needs, and shall allow independent entry to, use 

of, and exit from the equipment by such individuals to the maximum 

extent possible. 

‘‘(b) MEDICAL DIAGNOSTIC EQUIPMENT COVERED.—The standards issued under subsection (a) for medical diagnostic equipment 

shall apply to equipment that includes examination tables, examination chairs (including chairs used for eye examinations or procedures, and dental examinations or procedures), weight scales, 

mammography equipment, x-ray machines, and other radiological 

equipment commonly used for diagnostic purposes by health professionals. 

‘‘(c) REVIEW AND AMENDMENT.—The Architectural and 

Transportation Barriers Compliance Board, in consultation with 

the Commissioner of the Food and Drug Administration, shall 

periodically review and, as appropriate, amend the standards in 

accordance with the Administrative Procedure Act (2 U.S.C. 551 

et seq.).’’. 
H. R. 3590—453 

SEC. 4204. IMMUNIZATIONS. 

(a) STATE AUTHORITY TO PURCHASE RECOMMENDED VACCINES

FOR ADULTS.—Section 317 of the Public Health Service Act (42 

U.S.C. 247b) is amended by adding at the end the following: 

‘‘(l) AUTHORITY TO PURCHASE RECOMMENDED VACCINES FOR

ADULTS.— 

‘‘(1) IN GENERAL.—The Secretary may negotiate and enter 

into contracts with manufacturers of vaccines for the purchase 

and delivery of vaccines for adults as provided for under subsection (e). 

‘‘(2) STATE PURCHASE.—A State may obtain additional 

quantities of such adult vaccines (subject to amounts specified 

to the Secretary by the State in advance of negotiations) 

through the purchase of vaccines from manufacturers at the 

applicable price negotiated by the Secretary under this subsection.’’. 

(b) DEMONSTRATION PROGRAM TO IMPROVE IMMUNIZATION COVERAGE.—Section 317 of the Public Health Service Act (42 U.S.C. 

247b), as amended by subsection (a), is further amended by adding 

at the end the following: 

‘‘(m) DEMONSTRATION PROGRAM TO IMPROVE IMMUNIZATION

COVERAGE.— 

‘‘(1) IN GENERAL.—The Secretary, acting through the 

Director of the Centers for Disease Control and Prevention, 

shall establish a demonstration program to award grants to 

States to improve the provision of recommended immunizations 

for children, adolescents, and adults through the use of evidence-based, population-based interventions for high-risk populations. 

‘‘(2) STATE PLAN.—To be eligible for a grant under paragraph (1), a State shall submit to the Secretary an application 

at such time, in such manner, and containing such information 

as the Secretary may require, including a State plan that 

describes the interventions to be implemented under the grant 

and how such interventions match with local needs and 

capabilities, as determined through consultation with local 

authorities. 

‘‘(3) USE OF FUNDS.—Funds received under a grant under 

this subsection shall be used to implement interventions that 

are recommended by the Task Force on Community Preventive 

Services (as established by the Secretary, acting through the 

Director of the Centers for Disease Control and Prevention) 

or other evidence-based interventions, including— 

‘‘(A) providing immunization reminders or recalls for 

target populations of clients, patients, and consumers; 

‘‘(B) educating targeted populations and health care 

providers concerning immunizations in combination with 

one or more other interventions; 

‘‘(C) reducing out-of-pocket costs for families for vaccines and their administration; 

‘‘(D) carrying out immunization-promoting strategies 

for participants or clients of public programs, including 

assessments of immunization status, referrals to health 

care providers, education, provision of on-site immunizations, or incentives for immunization; 
H. R. 3590—454 

‘‘(E) providing for home visits that promote immunization through education, assessments of need, referrals, 

provision of immunizations, or other services; 

‘‘(F) providing reminders or recalls for immunization 

providers; 

‘‘(G) conducting assessments of, and providing feedback 

to, immunization providers; 

‘‘(H) any combination of one or more interventions 

described in this paragraph; or 

‘‘(I) immunization information systems to allow all 

States to have electronic databases for immunization 

records. 

‘‘(4) CONSIDERATION.—In awarding grants under this subsection, the Secretary shall consider any reviews or recommendations of the Task Force on Community Preventive 

Services. 

‘‘(5) EVALUATION.—Not later than 3 years after the date 

on which a State receives a grant under this subsection, the 

State shall submit to the Secretary an evaluation of progress 

made toward improving immunization coverage rates among 

high-risk populations within the State. 

‘‘(6) REPORT TO CONGRESS.—Not later than 4 years after 

the date of enactment of the Affordable Health Choices Act, 

the Secretary shall submit to Congress a report concerning 

the effectiveness of the demonstration program established 

under this subsection together with recommendations on 

whether to continue and expand such program. 

‘‘(7) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection, such sums 

as may be necessary for each of fiscal years 2010 through 

2014.’’. 

(c) REAUTHORIZATION OF IMMUNIZATION PROGRAM.—Section 

317(j) of the Public Health Service Act (42 U.S.C. 247b(j)) is 

amended— 

(1) in paragraph (1), by striking ‘‘for each of the fiscal 

years 1998 through 2005’’; and 

(2) in paragraph (2), by striking ‘‘after October 1, 1997,’’. 

(d) RULE OF CONSTRUCTION REGARDING ACCESS TO IMMUNIZATIONS.—Nothing in this section (including the amendments made 

by this section), or any other provision of this Act (including any 

amendments made by this Act) shall be construed to decrease 

children’s access to immunizations. 

(e) GAO STUDY AND REPORT ON MEDICARE BENEFICIARY ACCESS

TO VACCINES.— 

(1) STUDY.—The Comptroller General of the United States 

(in this section referred to as the ‘‘Comptroller General’’) shall 

conduct a study on the ability of Medicare beneficiaries who 

were 65 years of age or older to access routinely recommended 

vaccines covered under the prescription drug program under 

part D of title XVIII of the Social Security Act over the period 

since the establishment of such program. Such study shall 

include the following: 

(A) An analysis and determination of— 

(i) the number of Medicare beneficiaries who were 

65 years of age or older and were eligible for a routinely 

recommended vaccination that was covered under part 

D; 
H. R. 3590—455 

(ii) the number of such beneficiaries who actually 

received a routinely recommended vaccination that was 

covered under part D; and 

(iii) any barriers to access by such beneficiaries 

to routinely recommended vaccinations that were covered under part D. 

(B) A summary of the findings and recommendations 

by government agencies, departments, and advisory bodies 

(as well as relevant professional organizations) on the 

impact of coverage under part D of routinely recommended 

adult immunizations for access to such immunizations by 

Medicare beneficiaries. 

(2) REPORT.—Not later than June 1, 2011, the Comptroller 

General shall submit to the appropriate committees of jurisdiction of the House of Representatives and the Senate a report 

containing the results of the study conducted under paragraph 

(1), together with recommendations for such legislation and 

administrative action as the Comptroller General determines 

appropriate. 

(3) FUNDING.—Out of any funds in the Treasury not otherwise appropriated, there are appropriated $1,000,000 for fiscal 

year 2010 to carry out this subsection. 

SEC. 4205. NUTRITION LABELING OF STANDARD MENU ITEMS AT 

CHAIN RESTAURANTS. 

(a) TECHNICAL AMENDMENTS.—Section 403(q)(5)(A) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)(A)) is 

amended— 

(1) in subitem (i), by inserting at the beginning ‘‘except 

as provided in clause (H)(ii)(III),’’; and 

(2) in subitem (ii), by inserting at the beginning ‘‘except 

as provided in clause (H)(ii)(III),’’. 

(b) LABELING REQUIREMENTS.—Section 403(q)(5) of the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)) is amended 

by adding at the end the following: 

‘‘(H) RESTAURANTS, RETAIL FOOD ESTABLISHMENTS, AND

VENDING MACHINES.— 

‘‘(i) GENERAL REQUIREMENTS FOR RESTAURANTS AND SIMILAR

RETAIL FOOD ESTABLISHMENTS.—Except for food described in 

subclause (vii), in the case of food that is a standard menu 

item that is offered for sale in a restaurant or similar retail 

food establishment that is part of a chain with 20 or more 

locations doing business under the same name (regardless of 

the type of ownership of the locations) and offering for sale 

substantially the same menu items, the restaurant or similar 

retail food establishment shall disclose the information 

described in subclauses (ii) and (iii). 

‘‘(ii) INFORMATION REQUIRED TO BE DISCLOSED BY RESTAURANTS AND RETAIL FOOD ESTABLISHMENTS.—Except as provided in subclause (vii), the restaurant or similar retail food 

establishment shall disclose in a clear and conspicuous 

manner— 

‘‘(I)(aa) in a nutrient content disclosure statement adjacent to the name of the standard menu item, so as to 

be clearly associated with the standard menu item, on 

the menu listing the item for sale, the number of calories 
H. R. 3590—456 

contained in the standard menu item, as usually prepared 

and offered for sale; and 

‘‘(bb) a succinct statement concerning suggested daily 

caloric intake, as specified by the Secretary by regulation 

and posted prominently on the menu and designed to 

enable the public to understand, in the context of a total 

daily diet, the significance of the caloric information that 

is provided on the menu; 

‘‘(II)(aa) in a nutrient content disclosure statement 

adjacent to the name of the standard menu item, so as 

to be clearly associated with the standard menu item, 

on the menu board, including a drive-through menu board, 

the number of calories contained in the standard menu 

item, as usually prepared and offered for sale; and 

‘‘(bb) a succinct statement concerning suggested daily 

caloric intake, as specified by the Secretary by regulation 

and posted prominently on the menu board, designed to 

enable the public to understand, in the context of a total 

daily diet, the significance of the nutrition information 

that is provided on the menu board; 

‘‘(III) in a written form, available on the premises of the 

restaurant or similar retail establishment and to the consumer 

upon request, the nutrition information required under clauses 

(C) and (D) of subparagraph (1); and 

‘‘(IV) on the menu or menu board, a prominent, clear, 

and conspicuous statement regarding the availability of the 

information described in item (III). 

‘‘(iii) SELF-SERVICE FOOD AND FOOD ON DISPLAY.—Except 

as provided in subclause (vii), in the case of food sold at a 

salad bar, buffet line, cafeteria line, or similar self-service 

facility, and for self-service beverages or food that is on display 

and that is visible to customers, a restaurant or similar retail 

food establishment shall place adjacent to each food offered 

a sign that lists calories per displayed food item or per serving. 

‘‘(iv) REASONABLE BASIS.—For the purposes of this clause, 

a restaurant or similar retail food establishment shall have 

a reasonable basis for its nutrient content disclosures, including 

nutrient databases, cookbooks, laboratory analyses, and other 

reasonable means, as described in section 101.10 of title 21, 

Code of Federal Regulations (or any successor regulation) or 

in a related guidance of the Food and Drug Administration. 

‘‘(v) MENU VARIABILITY AND COMBINATION MEALS.—The Secretary shall establish by regulation standards for determining 

and disclosing the nutrient content for standard menu items 

that come in different flavors, varieties, or combinations, but 

which are listed as a single menu item, such as soft drinks, 

ice cream, pizza, doughnuts, or children’s combination meals, 

through means determined by the Secretary, including ranges, 

averages, or other methods. 

‘‘(vi) ADDITIONAL INFORMATION.—If the Secretary determines that a nutrient, other than a nutrient required under 

subclause (ii)(III), should be disclosed for the purpose of providing information to assist consumers in maintaining healthy 

dietary practices, the Secretary may require, by regulation, 

disclosure of such nutrient in the written form required under 

subclause (ii)(III). 

‘‘(vii) NONAPPLICABILITY TO CERTAIN FOOD.— 
H. R. 3590—457 

‘‘(I) IN GENERAL.—Subclauses (i) through (vi) do not 

apply to— 

‘‘(aa) items that are not listed on a menu or menu 

board (such as condiments and other items placed on 

the table or counter for general use); 

‘‘(bb) daily specials, temporary menu items 

appearing on the menu for less than 60 days per calendar year, or custom orders; or 

‘‘(cc) such other food that is part of a customary 

market test appearing on the menu for less than 90 

days, under terms and conditions established by the 

Secretary. 

‘‘(II) WRITTEN FORMS.—Subparagraph (5)(C) shall apply 

to any regulations promulgated under subclauses (ii)(III) 

and (vi). 

‘‘(viii) VENDING MACHINES.— 

‘‘(I) IN GENERAL.—In the case of an article of food 

sold from a vending machine that— 

‘‘(aa) does not permit a prospective purchaser to 

examine the Nutrition Facts Panel before purchasing 

the article or does not otherwise provide visible nutrition information at the point of purchase; and 

‘‘(bb) is operated by a person who is engaged in 

the business of owning or operating 20 or more vending 

machines, 

the vending machine operator shall provide a sign in close 

proximity to each article of food or the selection button 

that includes a clear and conspicuous statement disclosing 

the number of calories contained in the article. 

‘‘(ix) VOLUNTARY PROVISION OF NUTRITION INFORMATION.— ‘‘(I) IN GENERAL.—An authorized official of any restaurant or similar retail food establishment or vending 

machine operator not subject to the requirements of this 

clause may elect to be subject to the requirements of such 

clause, by registering biannually the name and address 

of such restaurant or similar retail food establishment or 

vending machine operator with the Secretary, as specified 

by the Secretary by regulation. 

‘‘(II) REGISTRATION.—Within 120 days of enactment of 

this clause, the Secretary shall publish a notice in the 

Federal Register specifying the terms and conditions for 

implementation of item (I), pending promulgation of regulations. 

‘‘(III) RULE OF CONSTRUCTION.—Nothing in this subclause shall be construed to authorize the Secretary to 

require an application, review, or licensing process for any 

entity to register with the Secretary, as described in such 

item. 

‘‘(x) REGULATIONS.— ‘‘(I) PROPOSED REGULATION.—Not later than 1 year 

after the date of enactment of this clause, the Secretary 

shall promulgate proposed regulations to carry out this 

clause. 

‘‘(II) CONTENTS.—In promulgating regulations, the Secretary shall— 

‘‘(aa) consider standardization of recipes and 

methods of preparation, reasonable variation in serving 
H. R. 3590—458 

size and formulation of menu items, space on menus 

and menu boards, inadvertent human error, training 

of food service workers, variations in ingredients, and 

other factors, as the Secretary determines; and 

‘‘(bb) specify the format and manner of the nutrient 

content disclosure requirements under this subclause. 

‘‘(III) REPORTING.—The Secretary shall submit to the 

Committee on Health, Education, Labor, and Pensions of 

the Senate and the Committee on Energy and Commerce 

of the House of Representatives a quarterly report that 

describes the Secretary’s progress toward promulgating 

final regulations under this subparagraph. 

‘‘(xi) DEFINITION.—In this clause, the term ‘menu’ or ‘menu 

board’ means the primary writing of the restaurant or other 

similar retail food establishment from which a consumer makes 

an order selection.’’ 

(c) NATIONAL UNIFORMITY.—Section 403A(a)(4) of the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 343–1(a)(4)) is amended 

by striking ‘‘except a requirement for nutrition labeling of food 

which is exempt under subclause (i) or (ii) of section 403(q)(5)(A)’’ 

and inserting ‘‘except that this paragraph does not apply to food 

that is offered for sale in a restaurant or similar retail food 

establishment that is not part of a chain with 20 or more locations 

doing business under the same name (regardless of the type of 

ownership of the locations) and offering for sale substantially the 

same menu items unless such restaurant or similar retail food 

establishment complies with the voluntary provision of nutrition 

information requirements under section 403(q)(5)(H)(ix)’’. 

(d) RULE OF CONSTRUCTION.—Nothing in the amendments made 

by this section shall be construed— 

(1) to preempt any provision of State or local law, unless 

such provision establishes or continues into effect nutrient content disclosures of the type required under section 403(q)(5)(H) 

of the Federal Food, Drug, and Cosmetic Act (as added by 

subsection (b)) and is expressly preempted under subsection 

(a)(4) of such section; 

(2) to apply to any State or local requirement respecting 

a statement in the labeling of food that provides for a warning 

concerning the safety of the food or component of the food; 

or 

(3) except as provided in section 403(q)(5)(H)(ix) of the 

Federal Food, Drug, and Cosmetic Act (as added by subsection 

(b)), to apply to any restaurant or similar retail food establishment other than a restaurant or similar retail food establishment described in section 403(q)(5)(H)(i) of such Act. 

SEC. 4206. DEMONSTRATION PROJECT CONCERNING INDIVIDUALIZED 

WELLNESS PLAN. 

Section 330 of the Public Health Service Act (42 U.S.C. 245b) 

is amended by adding at the end the following: 

‘‘(s) DEMONSTRATION PROGRAM FOR INDIVIDUALIZED WELLNESS

PLANS.— 

‘‘(1) IN GENERAL.—The Secretary shall establish a pilot 

program to test the impact of providing at-risk populations 

who utilize community health centers funded under this section 

an individualized wellness plan that is designed to reduce risk 
H. R. 3590—459 

factors for preventable conditions as identified by a comprehensive risk-factor assessment. 

‘‘(2) AGREEMENTS.—The Secretary shall enter into agreements with not more than 10 community health centers funded 

under this section to conduct activities under the pilot program 

under paragraph (1). 

‘‘(3) WELLNESS PLANS.— 

‘‘(A) IN GENERAL.—An individualized wellness plan prepared under the pilot program under this subsection may 

include one or more of the following as appropriate to 

the individual’s identified risk factors: 

‘‘(i) Nutritional counseling. 

‘‘(ii) A physical activity plan. 

‘‘(iii) Alcohol and smoking cessation counseling and 

services. 

‘‘(iv) Stress management. 

‘‘(v) Dietary supplements that have health claims 

approved by the Secretary. 

‘‘(vi) Compliance assistance provided by a community health center employee. 

‘‘(B) RISK FACTORS.—Wellness plan risk factors shall 

include— 

‘‘(i) weight; 

‘‘(ii) tobacco and alcohol use; 

‘‘(iii) exercise rates; 

‘‘(iv) nutritional status; and 

‘‘(v) blood pressure. 

‘‘(C) COMPARISONS.—Individualized wellness plans 

shall make comparisons between the individual involved 

and a control group of individuals with respect to the 

risk factors described in subparagraph (B). 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection, such sums 

as may be necessary.’’. 

SEC. 4207. REASONABLE BREAK TIME FOR NURSING MOTHERS. 

Section 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. 

207) is amended by adding at the end the following: 

‘‘(r)(1) An employer shall provide— 

‘‘(A) a reasonable break time for an employee to express 

breast milk for her nursing child for 1 year after the child’s 

birth each time such employee has need to express the milk; 

and 

‘‘(B) a place, other than a bathroom, that is shielded from 

view and free from intrusion from coworkers and the public, 

which may be used by an employee to express breast milk. 

‘‘(2) An employer shall not be required to compensate an 

employee receiving reasonable break time under paragraph (1) for 

any work time spent for such purpose. 

‘‘(3) An employer that employs less than 50 employees shall 

not be subject to the requirements of this subsection, if such requirements would impose an undue hardship by causing the employer 

significant difficulty or expense when considered in relation to 

the size, financial resources, nature, or structure of the employer’s 

business. 
H. R. 3590—460 

‘‘(4) Nothing in this subsection shall preempt a State law that 

provides greater protections to employees than the protections provided for under this subsection.’’. 

Subtitle D—Support for Prevention and 

Public Health Innovation 

SEC. 4301. RESEARCH ON OPTIMIZING THE DELIVERY OF PUBLIC 

HEALTH SERVICES. 

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

(referred to in this section as the ‘‘Secretary’’), acting through the 

Director of the Centers for Disease Control and Prevention, shall 

provide funding for research in the area of public health services 

and systems. 

(b) REQUIREMENTS OF RESEARCH.—Research supported under 

this section shall include— 

(1) examining evidence-based practices relating to prevention, with a particular focus on high priority areas as identified 

by the Secretary in the National Prevention Strategy or Healthy 

People 2020, and including comparing community-based public 

health interventions in terms of effectiveness and cost; 

(2) analyzing the translation of interventions from academic 

settings to real world settings; and 

(3) identifying effective strategies for organizing, financing, 

or delivering public health services in real world community 

settings, including comparing State and local health department structures and systems in terms of effectiveness and 

cost. 

(c) EXISTING PARTNERSHIPS.—Research supported under this 

section shall be coordinated with the Community Preventive Services Task Force and carried out by building on existing partnerships 

within the Federal Government while also considering initiatives 

at the State and local levels and in the private sector. 

(d) ANNUAL REPORT.—The Secretary shall, on an annual basis, 

submit to Congress a report concerning the activities and findings 

with respect to research supported under this section. 

SEC. 4302. UNDERSTANDING HEALTH DISPARITIES: DATA COLLECTION 

AND ANALYSIS. 

(a) UNIFORM CATEGORIES AND COLLECTION REQUIREMENTS.— The Public Health Service Act (42 U.S.C. 201 et seq.) is amended 

by adding at the end the following: 

‘‘TITLE XXXI—DATA COLLECTION, 

ANALYSIS, AND QUALITY 

‘‘SEC. 3101. DATA COLLECTION, ANALYSIS, AND QUALITY. 

‘‘(a) DATA COLLECTION.— ‘‘(1) IN GENERAL.—The Secretary shall ensure that, by not 

later than 2 years after the date of enactment of this title, 

any federally conducted or supported health care or public 

health program, activity or survey (including Current Population Surveys and American Community Surveys conducted 
H. R. 3590—461 

by the Bureau of Labor Statistics and the Bureau of the Census) 

collects and reports, to the extent practicable— 

‘‘(A) data on race, ethnicity, sex, primary language, 

and disability status for applicants, recipients, or participants; 

‘‘(B) data at the smallest geographic level such as 

State, local, or institutional levels if such data can be 

aggregated; 

‘‘(C) sufficient data to generate statistically reliable 

estimates by racial, ethnic, sex, primary language, and 

disability status subgroups for applicants, recipients or 

participants using, if needed, statistical oversamples of 

these subpopulations; and 

‘‘(D) any other demographic data as deemed appropriate by the Secretary regarding health disparities. 

‘‘(2) COLLECTION STANDARDS.—In collecting data described 

in paragraph (1), the Secretary or designee shall— 

‘‘(A) use Office of Management and Budget standards, 

at a minimum, for race and ethnicity measures; 

‘‘(B) develop standards for the measurement of sex, 

primary language, and disability status; 

‘‘(C) develop standards for the collection of data 

described in paragraph (1) that, at a minimum— 

‘‘(i) collects self-reported data by the applicant, 

recipient, or participant; and 

‘‘(ii) collects data from a parent or legal guardian 

if the applicant, recipient, or participant is a minor 

or legally incapacitated; 

‘‘(D) survey health care providers and establish other 

procedures in order to assess access to care and treatment 

for individuals with disabilities and to identify— 

‘‘(i) locations where individuals with disabilities 

access primary, acute (including intensive), and longterm care; 

‘‘(ii) the number of providers with accessible facilities and equipment to meet the needs of the individuals 

with disabilities, including medical diagnostic equipment that meets the minimum technical criteria set 

forth in section 510 of the Rehabilitation Act of 1973; 

and 

‘‘(iii) the number of employees of health care providers trained in disability awareness and patient care 

of individuals with disabilities; and 

‘‘(E) require that any reporting requirement imposed 

for purposes of measuring quality under any ongoing or 

federally conducted or supported health care or public 

health program, activity, or survey includes requirements 

for the collection of data on individuals receiving health 

care items or services under such programs activities by 

race, ethnicity, sex, primary language, and disability status. 

‘‘(3) DATA MANAGEMENT.—In collecting data described in 

paragraph (1), the Secretary, acting through the National 

Coordinator for Health Information Technology shall— 

‘‘(A) develop national standards for the management 

of data collected; and 

‘‘(B) develop interoperability and security systems for 

data management. 
H. R. 3590—462 

‘‘(b) DATA ANALYSIS.— 

‘‘(1) IN GENERAL.—For each federally conducted or supported health care or public health program or activity, the 

Secretary shall analyze data collected under paragraph (a) to 

detect and monitor trends in health disparities (as defined 

for purposes of section 485E) at the Federal and State levels. 

‘‘(c) DATA REPORTING AND DISSEMINATION.— 

‘‘(1) IN GENERAL.—The Secretary shall make the analyses 

described in (b) available to— 

‘‘(A) the Office of Minority Health; 

‘‘(B) the National Center on Minority Health and 

Health Disparities; 

‘‘(C) the Agency for Healthcare Research and Quality; 

‘‘(D) the Centers for Disease Control and Prevention; 

‘‘(E) the Centers for Medicare & Medicaid Services; 

‘‘(F) the Indian Health Service and epidemiology centers funded under the Indian Health Care Improvement 

Act; 

‘‘(G) the Office of Rural health; 

‘‘(H) other agencies within the Department of Health 

and Human Services; and 

‘‘(I) other entities as determined appropriate by the 

Secretary. 

‘‘(2) REPORTING OF DATA.—The Secretary shall report data 

and analyses described in (a) and (b) through— 

‘‘(A) public postings on the Internet websites of the 

Department of Health and Human Services; and 

‘‘(B) any other reporting or dissemination mechanisms 

determined appropriate by the Secretary. 

‘‘(3) AVAILABILITY OF DATA.—The Secretary may make data 

described in (a) and (b) available for additional research, analyses, and dissemination to other Federal agencies, non-governmental entities, and the public, in accordance with any Federal 

agency’s data user agreements. 

‘‘(d) LIMITATIONS ON USE OF DATA.—Nothing in this section 

shall be construed to permit the use of information collected under 

this section in a manner that would adversely affect any individual. 

‘‘(e) PROTECTION AND SHARING OF DATA.— 

‘‘(1) PRIVACY AND OTHER SAFEGUARDS.—The Secretary shall 

ensure (through the promulgation of regulations or otherwise) 

that— 

‘‘(A) all data collected pursuant to subsection (a) is 

protected— 

‘‘(i) under privacy protections that are at least 

as broad as those that the Secretary applies to other 

health data under the regulations promulgated under 

section 264(c) of the Health Insurance Portability and 

Accountability Act of 1996 (Public Law 104–191; 110 

Stat. 2033); and 

‘‘(ii) from all inappropriate internal use by any 

entity that collects, stores, or receives the data, 

including use of such data in determinations of eligibility (or continued eligibility) in health plans, and 

from other inappropriate uses, as defined by the Secretary; and 
H. R. 3590—463 

‘‘(B) all appropriate information security safeguards 

are used in the collection, analysis, and sharing of data 

collected pursuant to subsection (a). 

‘‘(2) DATA SHARING.—The Secretary shall establish procedures for sharing data collected pursuant to subsection (a), 

measures relating to such data, and analyses of such data, 

with other relevant Federal and State agencies including the 

agencies, centers, and entities within the Department of Health 

and Human Services specified in subsection (c)(1).. 

‘‘(f) DATA ON RURAL UNDERSERVED POPULATIONS.—The Secretary shall ensure that any data collected in accordance with 

this section regarding racial and ethnic minority groups are also 

collected regarding underserved rural and frontier populations. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of fiscal years 2010 through 

2014. 

‘‘(h) REQUIREMENT FOR IMPLEMENTATION.—Notwithstanding 

any other provision of this section, data may not be collected under 

this section unless funds are directly appropriated for such purpose 

in an appropriations Act. 

‘‘(i) CONSULTATION.—The Secretary shall consult with the 

Director of the Office of Personnel Management, the Secretary 

of Defense, the Secretary of Veterans Affairs, the Director of the 

Bureau of the Census, the Commissioner of Social Security, and 

the head of other appropriate Federal agencies in carrying out 

this section.’’. 

(b) ADDRESSING HEALTH CARE DISPARITIES IN MEDICAID AND

CHIP.— 

(1) STANDARDIZED COLLECTION REQUIREMENTS INCLUDED IN

STATE PLANS.— 

(A) MEDICAID.—Section 1902(a) of the Social Security 

Act (42 U.S.C. 1396a(a)), as amended by section 2001(d), 

is amended— 

(i) in paragraph 4), by striking ‘‘and’’ at the end; 

(ii) in paragraph (75), by striking the period at 

the end and inserting ‘‘; and’’; and 

(iii) by inserting after paragraph (75) the following 

new paragraph: 

‘‘(76) provide that any data collected under the State plan 

meets the requirements of section 3101 of the Public Health 

Service Act.’’. 

(B) CHIP.—Section 2108(e) of the Social Security Act 

(42 U.S.C. 1397hh(e)) is amended by adding at the end 

the following new paragraph: 

‘‘(7) Data collected and reported in accordance with section 

3101 of the Public Health Service Act, with respect to individuals enrolled in the State child health plan (and, in the case 

of enrollees under 19 years of age, their parents or legal guardians), including data regarding the primary language of such 

individuals, parents, and legal guardians.’’. 

(2) EXTENDING MEDICARE REQUIREMENT TO ADDRESS

HEALTH DISPARITIES DATA COLLECTION TO MEDICAID AND CHIP.— 

Title XIX of the Social Security Act (42 U.S.C. 1396 et seq.), 

as amended by section 2703 is amended by adding at the 

end the following new section: 
H. R. 3590—464 

‘‘SEC. 1946. ADDRESSING HEALTH CARE DISPARITIES. 

‘‘(a) EVALUATING DATA COLLECTION APPROACHES.—The Secretary shall evaluate approaches for the collection of data under 

this title and title XXI, to be performed in conjunction with existing 

quality reporting requirements and programs under this title and 

title XXI, that allow for the ongoing, accurate, and timely collection 

and evaluation of data on disparities in health care services and 

performance on the basis of race, ethnicity, sex, primary language, 

and disability status. In conducting such evaluation, the Secretary 

shall consider the following objectives: 

‘‘(1) Protecting patient privacy. 

‘‘(2) Minimizing the administrative burdens of data collection and reporting on States, providers, and health plans 

participating under this title or title XXI. 

‘‘(3) Improving program data under this title and title 

XXI on race, ethnicity, sex, primary language, and disability 

status. 

‘‘(b) REPORTS TO CONGRESS.— 

‘‘(1) REPORT ON EVALUATION.—Not later than 18 months 

after the date of the enactment of this section, the Secretary 

shall submit to Congress a report on the evaluation conducted 

under subsection (a). Such report shall, taking into consideration the results of such evaluation— 

‘‘(A) identify approaches (including defining methodologies) for identifying and collecting and evaluating data 

on health care disparities on the basis of race, ethnicity, 

sex, primary language, and disability status for the programs under this title and title XXI; and 

‘‘(B) include recommendations on the most effective 

strategies and approaches to reporting HEDIS quality 

measures as required under section 1852(e)(3) and other 

nationally recognized quality performance measures, as 

appropriate, on such bases. 

‘‘(2) REPORTS ON DATA ANALYSES.—Not later than 4 years 

after the date of the enactment of this section, and 4 years 

thereafter, the Secretary shall submit to Congress a report 

that includes recommendations for improving the identification 

of health care disparities for beneficiaries under this title and 

under title XXI based on analyses of the data collected under 

subsection (c). 

‘‘(c) IMPLEMENTING EFFECTIVE APPROACHES.—Not later than 

24 months after the date of the enactment of this section, the 

Secretary shall implement the approaches identified in the report 

submitted under subsection (b)(1) for the ongoing, accurate, and 

timely collection and evaluation of data on health care disparities 

on the basis of race, ethnicity, sex, primary language, and disability 

status.’’. 

SEC. 4303. CDC AND EMPLOYER-BASED WELLNESS PROGRAMS. 

Title III of the Public Health Service Act (42 U.S.C. 241 et 

seq.), by section 4102, is further amended by adding at the end 

the following: 
H. R. 3590—465 

‘‘PART U—EMPLOYER-BASED WELLNESS 

PROGRAM 

‘‘SEC. 399MM. TECHNICAL ASSISTANCE FOR EMPLOYER-BASED 

WELLNESS PROGRAMS. 

‘‘In order to expand the utilization of evidence-based prevention 

and health promotion approaches in the workplace, the Director 

shall— 

‘‘(1) provide employers (including small, medium, and large 

employers, as determined by the Director) with technical assistance, consultation, tools, and other resources in evaluating 

such employers’ employer-based wellness programs, including— 

‘‘(A) measuring the participation and methods to 

increase participation of employees in such programs; 

‘‘(B) developing standardized measures that assess 

policy, environmental and systems changes necessary to 

have a positive health impact on employees’ health behaviors, health outcomes, and health care expenditures; and 

‘‘(C) evaluating such programs as they relate to 

changes in the health status of employees, the absenteeism 

of employees, the productivity of employees, the rate of 

workplace injury, and the medical costs incurred by 

employees; and 

‘‘(2) build evaluation capacity among workplace staff by 

training employers on how to evaluate employer-based wellness 

programs by ensuring evaluation resources, technical assistance, and consultation are available to workplace staff as 

needed through such mechanisms as web portals, call centers, 

or other means. 

‘‘SEC. 399MM–1. NATIONAL WORKSITE HEALTH POLICIES AND PROGRAMS STUDY. 

‘‘(a) IN GENERAL.—In order to assess, analyze, and monitor 

over time data about workplace policies and programs, and to 

develop instruments to assess and evaluate comprehensive workplace chronic disease prevention and health promotion programs, 

policies and practices, not later than 2 years after the date of 

enactment of this part, and at regular intervals (to be determined 

by the Director) thereafter, the Director shall conduct a national 

worksite health policies and programs survey to assess employerbased health policies and programs. 

‘‘(b) REPORT.—Upon the completion of each study under subsection (a), the Director shall submit to Congress a report that 

includes the recommendations of the Director for the implementation of effective employer-based health policies and programs. 

‘‘SEC. 399MM–2. PRIORITIZATION OF EVALUATION BY SECRETARY. 

‘‘The Secretary shall evaluate, in accordance with this part, 

all programs funded through the Centers for Disease Control and 

Prevention before conducting such an evaluation of privately funded 

programs unless an entity with a privately funded wellness program 

requests such an evaluation. 

‘‘SEC. 399MM–3. PROHIBITION OF FEDERAL WORKPLACE WELLNESS 

REQUIREMENTS. 

‘‘Notwithstanding any other provision of this part, any recommendations, data, or assessments carried out under this part 
H. R. 3590—466 

shall not be used to mandate requirements for workplace wellness 

programs.’’. 

SEC. 4304. EPIDEMIOLOGY-LABORATORY CAPACITY GRANTS. 

Title XXVIII of the Public Health Service Act (42 U.S.C. 300hh 

et seq.) is amended by adding at the end the following: 

‘‘Subtitle C—Strengthening Public Health 

Surveillance Systems 

‘‘SEC. 2821. EPIDEMIOLOGY-LABORATORY CAPACITY GRANTS. 

‘‘(a) IN GENERAL.—Subject to the availability of appropriations, 

the Secretary, acting through the Director of the Centers for Disease 

Control and Prevention, shall establish an Epidemiology and Laboratory Capacity Grant Program to award grants to State health 

departments as well as local health departments and tribal jurisdictions that meet such criteria as the Director determines appropriate. 

Academic centers that assist State and eligible local and tribal 

health departments may also be eligible for funding under this 

section as the Director determines appropriate. Grants shall be 

awarded under this section to assist public health agencies in 

improving surveillance for, and response to, infectious diseases and 

other conditions of public health importance by— 

‘‘(1) strengthening epidemiologic capacity to identify and 

monitor the occurrence of infectious diseases and other conditions of public health importance; 

‘‘(2) enhancing laboratory practice as well as systems to 

report test orders and results electronically; 

‘‘(3) improving information systems including developing 

and maintaining an information exchange using national guidelines and complying with capacities and functions determined 

by an advisory council established and appointed by the 

Director; and 

‘‘(4) developing and implementing prevention and control 

strategies. 

‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section $190,000,000 for each 

of fiscal years 2010 through 2013, of which— ‘‘(1) not less than $95,000,000 shall be made available 

each such fiscal year for activities under paragraphs (1) and 

(4) of subsection (a); 

‘‘(2) not less than $60,000,000 shall be made available 

each such fiscal year for activities under subsection (a)(3); and ‘‘(3) not less than $32,000,000 shall be made available 

each such fiscal year for activities under subsection (a)(2).’’. 

SEC. 4305. ADVANCING RESEARCH AND TREATMENT FOR PAIN CARE 

MANAGEMENT. 

(a) INSTITUTE OF MEDICINE CONFERENCE ON PAIN.— (1) CONVENING.—Not later than 1 year after funds are 

appropriated to carry out this subsection, the Secretary of 

Health and Human Services shall seek to enter into an agreement with the Institute of Medicine of the National Academies 

to convene a Conference on Pain (in this subsection referred 

to as ‘‘the Conference’’). 
H. R. 3590—467 

(2) PURPOSES.—The purposes of the Conference shall be 

to— 

(A) increase the recognition of pain as a significant 

public health problem in the United States; 

(B) evaluate the adequacy of assessment, diagnosis, 

treatment, and management of acute and chronic pain 

in the general population, and in identified racial, ethnic, 

gender, age, and other demographic groups that may be 

disproportionately affected by inadequacies in the assessment, diagnosis, treatment, and management of pain; 

(C) identify barriers to appropriate pain care; 

(D) establish an agenda for action in both the public 

and private sectors that will reduce such barriers and 

significantly improve the state of pain care research, education, and clinical care in the United States. 

(3) OTHER APPROPRIATE ENTITY.—If the Institute of Medicine declines to enter into an agreement under paragraph (1), 

the Secretary of Health and Human Services may enter into 

such agreement with another appropriate entity. 

(4) REPORT.—A report summarizing the Conference’s 

findings and recommendations shall be submitted to the Congress not later than June 30, 2011. 

(5) AUTHORIZATION OF APPROPRIATIONS.—For the purpose 

of carrying out this subsection, there is authorized to be appropriated such sums as may be necessary for each of fiscal years 

2010 and 2011. 

(b) PAIN RESEARCH AT NATIONAL INSTITUTES OF HEALTH.— Part B of title IV of the Public Health Service Act (42 U.S.C. 

284 et seq.) is amended by adding at the end the following: 

‘‘SEC. 409J. PAIN RESEARCH. 

‘‘(a) RESEARCH INITIATIVES.— 

‘‘(1) IN GENERAL.—The Director of NIH is encouraged to 

continue and expand, through the Pain Consortium, an aggressive program of basic and clinical research on the causes of 

and potential treatments for pain. 

‘‘(2) ANNUAL RECOMMENDATIONS.—Not less than annually, 

the Pain Consortium, in consultation with the Division of Program Coordination, Planning, and Strategic Initiatives, shall 

develop and submit to the Director of NIH recommendations 

on appropriate pain research initiatives that could be undertaken with funds reserved under section 402A(c)(1) for the 

Common Fund or otherwise available for such initiatives. 

‘‘(3) DEFINITION.—In this subsection, the term ‘Pain Consortium’ means the Pain Consortium of the National Institutes 

of Health or a similar trans-National Institutes of Health 

coordinating entity designated by the Secretary for purposes 

of this subsection. 

‘‘(b) INTERAGENCY PAIN RESEARCH COORDINATING COMMITTEE.— 

‘‘(1) ESTABLISHMENT.—The Secretary shall establish not 

later than 1 year after the date of the enactment of this section 

and as necessary maintain a committee, to be known as the 

Interagency Pain Research Coordinating Committee (in this 

section referred to as the ‘Committee’), to coordinate all efforts 

within the Department of Health and Human Services and 

other Federal agencies that relate to pain research. 
H. R. 3590—468 

‘‘(2) MEMBERSHIP.— 

‘‘(A) IN GENERAL.—The Committee shall be composed 

of the following voting members: 

‘‘(i) Not more than 7 voting Federal representatives 

appoint by the Secretary from agencies that conduct 

pain care research and treatment. 

‘‘(ii) 12 additional voting members appointed under 

subparagraph (B). 

‘‘(B) ADDITIONAL MEMBERS.—The Committee shall 

include additional voting members appointed by the Secretary as follows: 

‘‘(i) 6 non-Federal members shall be appointed from 

among scientists, physicians, and other health professionals. 

‘‘(ii) 6 members shall be appointed from members 

of the general public, who are representatives of 

leading research, advocacy, and service organizations 

for individuals with pain-related conditions. 

‘‘(C) NONVOTING MEMBERS.—The Committee shall 

include such nonvoting members as the Secretary determines to be appropriate. 

‘‘(3) CHAIRPERSON.—The voting members of the Committee 

shall select a chairperson from among such members. The 

selection of a chairperson shall be subject to the approval 

of the Director of NIH. 

‘‘(4) MEETINGS.—The Committee shall meet at the call of 

the chairperson of the Committee or upon the request of the 

Director of NIH, but in no case less often than once each 

year. 

‘‘(5) DUTIES.—The Committee shall— 

‘‘(A) develop a summary of advances in pain care 

research supported or conducted by the Federal agencies 

relevant to the diagnosis, prevention, and treatment of 

pain and diseases and disorders associated with pain; 

‘‘(B) identify critical gaps in basic and clinical research 

on the symptoms and causes of pain; 

‘‘(C) make recommendations to ensure that the activities of the National Institutes of Health and other Federal 

agencies are free of unnecessary duplication of effort; 

‘‘(D) make recommendations on how best to disseminate information on pain care; and 

‘‘(E) make recommendations on how to expand partnerships between public entities and private entities to expand 

collaborative, cross-cutting research. 

‘‘(6) REVIEW.—The Secretary shall review the necessity of 

the Committee at least once every 2 years.’’. 

(c) PAIN CARE EDUCATION AND TRAINING.—Part D of title VII 

of the Public Health Service Act (42 U.S.C. 294 et seq.) is amended 

by adding at the end the following new section: 

‘‘SEC. 759. PROGRAM FOR EDUCATION AND TRAINING IN PAIN CARE. 

‘‘(a) IN GENERAL.—The Secretary may make awards of grants, 

cooperative agreements, and contracts to health professions schools, 

hospices, and other public and private entities for the development 

and implementation of programs to provide education and training 

to health care professionals in pain care. 
H. R. 3590—469 

‘‘(b) CERTAIN TOPICS.—An award may be made under subsection 

(a) only if the applicant for the award agrees that the program 

carried out with the award will include information and education 

on— 

‘‘(1) recognized means for assessing, diagnosing, treating, 

and managing pain and related signs and symptoms, including 

the medically appropriate use of controlled substances; 

‘‘(2) applicable laws, regulations, rules, and policies on controlled substances, including the degree to which misconceptions and concerns regarding such laws, regulations, rules, 

and policies, or the enforcement thereof, may create barriers 

to patient access to appropriate and effective pain care; 

‘‘(3) interdisciplinary approaches to the delivery of pain 

care, including delivery through specialized centers providing 

comprehensive pain care treatment expertise; 

‘‘(4) cultural, linguistic, literacy, geographic, and other barriers to care in underserved populations; and 

‘‘(5) recent findings, developments, and improvements in 

the provision of pain care. 

‘‘(c) EVALUATION OF PROGRAMS.—The Secretary shall (directly 

or through grants or contracts) provide for the evaluation of programs implemented under subsection (a) in order to determine 

the effect of such programs on knowledge and practice of pain 

care. 

‘‘(d) PAIN CARE DEFINED.—For purposes of this section the 

term ‘pain care’ means the assessment, diagnosis, treatment, or 

management of acute or chronic pain regardless of causation or 

body location. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section, such sums as may 

be necessary for each of the fiscal years 2010 through 2012. 

Amounts appropriated under this subsection shall remain available 

until expended.’’. 

SEC. 4306. FUNDING FOR CHILDHOOD OBESITY DEMONSTRATION 

PROJECT. 

Section 1139A(e)(8) of the Social Security Act (42 U.S.C. 1320b– 

9a(e)(8)) is amended to read as follows: 

‘‘(8) APPROPRIATION.—Out of any funds in the Treasury 

not otherwise appropriated, there is appropriated to carry out 

this subsection, $25,000,000 for the period of fiscal years 2010 

through 2014.’’. 

Subtitle E—Miscellaneous Provisions 

SEC. 4401. SENSE OF THE SENATE CONCERNING CBO SCORING. 

(a) FINDING.—The Senate finds that the costs of prevention 

programs are difficult to estimate due in part because prevention 

initiatives are hard to measure and results may occur outside 

the 5 and 10 year budget windows. 

(b) SENSE OF CONGRESS.—It is the sense of the Senate that 

Congress should work with the Congressional Budget Office to 

develop better methodologies for scoring progress to be made in 

prevention and wellness programs. 
H. R. 3590—470 

SEC. 4402. EFFECTIVENESS OF FEDERAL HEALTH AND WELLNESS INITIATIVES. 

To determine whether existing Federal health and wellness 

initiatives are effective in achieving their stated goals, the Secretary 

of Health and Human Services shall— 

(1) conduct an evaluation of such programs as they relate 

to changes in health status of the American public and specifically on the health status of the Federal workforce, including 

absenteeism of employees, the productivity of employees, the 

rate of workplace injury, and the medical costs incurred by 

employees, and health conditions, including workplace fitness, 

healthy food and beverages, and incentives in the Federal 

Employee Health Benefits Program; and 

(2) submit to Congress a report concerning such evaluation, 

which shall include conclusions concerning the reasons that 

such existing programs have proven successful or not successful 

and what factors contributed to such conclusions. 

TITLE V—HEALTH CARE WORKFORCE 

Subtitle A—Purpose and Definitions 

SEC. 5001. PURPOSE. 

The purpose of this title is to improve access to and the delivery 

of health care services for all individuals, particularly low income, 

underserved, uninsured, minority, health disparity, and rural populations by— 

(1) gathering and assessing comprehensive data in order 

for the health care workforce to meet the health care needs 

of individuals, including research on the supply, demand, distribution, diversity, and skills needs of the health care 

workforce; 

(2) increasing the supply of a qualified health care 

workforce to improve access to and the delivery of health care 

services for all individuals; 

(3) enhancing health care workforce education and training 

to improve access to and the delivery of health care services 

for all individuals; and 

(4) providing support to the existing health care workforce 

to improve access to and the delivery of health care services 

for all individuals. 

SEC. 5002. DEFINITIONS. 

(a) THIS TITLE.—In this title: 

(1) ALLIED HEALTH PROFESSIONAL.—The term ‘‘allied health 

professional’’ means an allied health professional as defined 

in section 799B(5) of the Public Heath Service Act (42 U.S.C. 

295p(5)) who— 

(A) has graduated and received an allied health professions degree or certificate from an institution of higher 

education; and 

(B) is employed with a Federal, State, local or tribal 

public health agency, or in a setting where patients might 

require health care services, including acute care facilities, 

ambulatory care facilities, personal residences, and other 
H. R. 3590—471 

settings located in health professional shortage areas, medically underserved areas, or medically underserved populations, as recognized by the Secretary of Health and 

Human Services. 

(2) HEALTH CARE CAREER PATHWAY.—The term ‘‘healthcare 

career pathway’’ means a rigorous, engaging, and high quality 

set of courses and services that— 

(A) includes an articulated sequence of academic and 

career courses, including 21st century skills; 

(B) is aligned with the needs of healthcare industries 

in a region or State; 

(C) prepares students for entry into the full range 

of postsecondary education options, including registered 

apprenticeships, and careers; 

(D) provides academic and career counseling in student-to-counselor ratios that allow students to make 

informed decisions about academic and career options; 

(E) meets State academic standards, State requirements for secondary school graduation and is aligned with 

requirements for entry into postsecondary education, and 

applicable industry standards; and 

(F) leads to 2 or more credentials, including— 

(i) a secondary school diploma; and 

(ii) a postsecondary degree, an apprenticeship or 

other occupational certification, a certificate, or a 

license. 

(3) INSTITUTION OF HIGHER EDUCATION.—The term ‘‘institution of higher education’’ has the meaning given the term 

in sections 101 and 102 of the Higher Education Act of 1965 

(20 U.S.C. 1001 and 1002). 

(4) LOW INCOME INDIVIDUAL, STATE WORKFORCE INVESTMENT BOARD, AND LOCAL WORKFORCE INVESTMENT BOARD.— 

(A) LOW-INCOME INDIVIDUAL.—The term ‘‘low-income 

individual’’ has the meaning given that term in section 

101 of the Workforce investment Act of 1998 (29 U.S.C. 

2801). 

(B) STATE WORKFORCE INVESTMENT BOARD; LOCAL

WORKFORCE INVESTMENT BOARD.—The terms ‘‘State 

workforce investment board’’ and ‘‘local workforce investment board’’, refer to a State workforce investment board 

established under section 111 of the Workforce Investment 

Act of 1998 (29 U.S.C. 2821) and a local workforce investment board established under section 117 of such Act (29 

U.S.C. 2832), respectively. 

(5) POSTSECONDARY EDUCATION.—The term ‘‘postsecondary 

education’’ means— 

(A) a 4-year program of instruction, or not less than 

a 1-year program of instruction that is acceptable for credit 

toward an associate or a baccalaureate degree, offered by 

an institution of higher education; or 

(B) a certificate or registered apprenticeship program 

at the postsecondary level offered by an institution of 

higher education or a non-profit educational institution. 

(6) REGISTERED APPRENTICESHIP PROGRAM.—The term ‘‘registered apprenticeship program’’ means an industry skills 

training program at the postsecondary level that combines technical and theoretical training through structure on the job 
H. R. 3590—472 

learning with related instruction (in a classroom or through 

distance learning) while an individual is employed, working 

under the direction of qualified personnel or a mentor, and 

earning incremental wage increases aligned to enhance job 

proficiency, resulting in the acquisition of a nationally recognized and portable certificate, under a plan approved by the 

Office of Apprenticeship or a State agency recognized by the 

Department of Labor. 

(b) TITLE VII OF THE PUBLIC HEALTH SERVICE ACT.—Section 

799B of the Public Health Service Act (42 U.S.C. 295p) is amended— 

(1) by striking paragraph (3) and inserting the following: 

‘‘(3) PHYSICIAN ASSISTANT EDUCATION PROGRAM.—The term 

‘physician assistant education program’ means an educational 

program in a public or private institution in a State that— 

‘‘(A) has as its objective the education of individuals 

who, upon completion of their studies in the program, 

be qualified to provide primary care medical services with 

the supervision of a physician; and 

‘‘(B) is accredited by the Accreditation Review Commission on Education for the Physician Assistant.’’; and 

(2) by adding at the end the following: 

‘‘(12) AREA HEALTH EDUCATION CENTER.—The term ‘area 

health education center’ means a public or nonprofit private 

organization that has a cooperative agreement or contract in 

effect with an entity that has received an award under subsection (a)(1) or (a)(2) of section 751, satisfies the requirements 

in section 751(d)(1), and has as one of its principal functions 

the operation of an area health education center. Appropriate 

organizations may include hospitals, health organizations with 

accredited primary care training programs, accredited physician 

assistant educational programs associated with a college or 

university, and universities or colleges not operating a school 

of medicine or osteopathic medicine. 

‘‘(13) AREA HEALTH EDUCATION CENTER PROGRAM.—The 

term ‘area health education center program’ means cooperative 

program consisting of an entity that has received an award 

under subsection (a)(1) or (a)(2) of section 751 for the purpose 

of planning, developing, operating, and evaluating an area 

health education center program and one or more area health 

education centers, which carries out the required activities 

described in section 751(c), satisfies the program requirements 

in such section, has as one of its principal functions identifying 

and implementing strategies and activities that address health 

care workforce needs in its service area, in coordination with 

the local workforce investment boards. 

‘‘(14) CLINICAL SOCIAL WORKER.—The term ‘clinical social 

worker’ has the meaning given the term in section 1861(hh)(1) 

of the Social Security Act (42 U.S.C. 1395x(hh)(1)). 

‘‘(15) CULTURAL COMPETENCY.—The term ‘cultural competency’ shall be defined by the Secretary in a manner consistent with section 1707(d)(3). 

‘‘(16) DIRECT CARE WORKER.—The term ‘direct care worker’ 

has the meaning given that term in the 2010 Standard Occupational Classifications of the Department of Labor for Home 

Health Aides [31–1011], Psychiatric Aides [31–1013], Nursing 

Assistants [31–1014], and Personal Care Aides [39–9021]. 
H. R. 3590—473 

‘‘(17) FEDERALLY QUALIFIED HEALTH CENTER.—The term 

‘Federally qualified health center’ has the meaning given that 

term in section 1861(aa) of the Social Security Act (42 U.S.C. 

1395x(aa)). 

‘‘(18) FRONTIER HEALTH PROFESSIONAL SHORTAGE AREA.— 

The term ‘frontier health professional shortage area’ means 

an area— 

‘‘(A) with a population density less than 6 persons 

per square mile within the service area; and 

‘‘(B) with respect to which the distance or time for 

the population to access care is excessive. 

‘‘(19) GRADUATE PSYCHOLOGY.—The term ‘graduate psychology’ means an accredited program in professional psychology. 

‘‘(20) HEALTH DISPARITY POPULATION.—The term ‘health 

disparity population’ has the meaning given such term in section 903(d)(1). 

‘‘(21) HEALTH LITERACY.—The term ‘health literacy’ means 

the degree to which an individual has the capacity to obtain, 

communicate, process, and understand health information and 

services in order to make appropriate health decisions. 

‘‘(22) MENTAL HEALTH SERVICE PROFESSIONAL.—The term 

‘mental health service professional’ means an individual with 

a graduate or postgraduate degree from an accredited institution of higher education in psychiatry, psychology, school psychology, behavioral pediatrics, psychiatric nursing, social work, 

school social work, substance abuse disorder prevention and 

treatment, marriage and family counseling, school counseling, 

or professional counseling. 

‘‘(23) ONE-STOP DELIVERY SYSTEM CENTER.—The term ‘onestop delivery system’ means a one-stop delivery system 

described in section 134(c) of the Workforce Investment Act 

of 1998 (29 U.S.C. 2864(c)). 

‘‘(24) PARAPROFESSIONAL CHILD AND ADOLESCENT MENTAL

HEALTH WORKER.—The term ‘paraprofessional child and adolescent mental health worker’ means an individual who is not 

a mental or behavioral health service professional, but who 

works at the first stage of contact with children and families 

who are seeking mental or behavioral health services, including 

substance abuse prevention and treatment services. 

‘‘(25) RACIAL AND ETHNIC MINORITY GROUP; RACIAL AND

ETHNIC MINORITY POPULATION.—The terms ‘racial and ethnic 

minority group’ and ‘racial and ethnic minority population’ 

have the meaning given the term ‘racial and ethnic minority 

group’ in section 1707. 

‘‘(26) RURAL HEALTH CLINIC.—The term ‘rural health clinic’ 

has the meaning given that term in section 1861(aa) of the 

Social Security Act (42 U.S.C. 1395x(aa)).’’. 

(c) TITLE VIII OF THE PUBLIC HEALTH SERVICE ACT.—Section 

801 of the Public Health Service Act (42 U.S.C. 296) is amended— 

(1) in paragraph (2)— 

(A) by striking ‘‘means a’’ and inserting ‘‘means an 

accredited (as defined in paragraph 6)’’; and 

(B) by striking the period as inserting the following: 

‘‘where graduates are— 

‘‘(A) authorized to sit for the National Council Licensure EXamination-Registered Nurse (NCLEX–RN); or 
H. R. 3590—474 

‘‘(B) licensed registered nurses who will receive a graduate or equivalent degree or training to become an 

advanced education nurse as defined by section 811(b).’’; 

and 

(2) by adding at the end the following: 

‘‘(16) ACCELERATED NURSING DEGREE PROGRAM.—The term 

‘accelerated nursing degree program’ means a program of education in professional nursing offered by an accredited school 

of nursing in which an individual holding a bachelors degree 

in another discipline receives a BSN or MSN degree in an 

accelerated time frame as determined by the accredited school 

of nursing. 

‘‘(17) BRIDGE OR DEGREE COMPLETION PROGRAM.—The term 

‘bridge or degree completion program’ means a program of 

education in professional nursing offered by an accredited school 

of nursing, as defined in paragraph (2), that leads to a baccalaureate degree in nursing. Such programs may include, Registered Nurse (RN) to Bachelor’s of Science of Nursing (BSN) 

programs, RN to MSN (Master of Science of Nursing) programs, 

or BSN to Doctoral programs.’’. 

Subtitle B—Innovations in the Health Care 

Workforce 

SEC. 5101. NATIONAL HEALTH CARE WORKFORCE COMMISSION. 

(a) PURPOSE.—It is the purpose of this section to establish 

a National Health Care Workforce Commission that— 

(1) serves as a national resource for Congress, the President, States, and localities; 

(2) communicates and coordinates with the Departments 

of Health and Human Services, Labor, Veterans Affairs, Homeland Security, and Education on related activities administered 

by one or more of such Departments; 

(3) develops and commissions evaluations of education and 

training activities to determine whether the demand for health 

care workers is being met; 

(4) identifies barriers to improved coordination at the Federal, State, and local levels and recommend ways to address 

such barriers; and 

(5) encourages innovations to address population needs, 

constant changes in technology, and other environmental factors. 

(b) ESTABLISHMENT.—There is hereby established the National 

Health Care Workforce Commission (in this section referred to 

as the ‘‘Commission’’). 

(c) MEMBERSHIP.— (1) NUMBER AND APPOINTMENT.—The Commission shall be 

composed of 15 members to be appointed by the Comptroller 

General, without regard to section 5 of the Federal Advisory 

Committee Act (5 U.S.C. App.). 

(2) QUALIFICATIONS.— (A) IN GENERAL.—The membership of the Commission 

shall include individuals— 

(i) with national recognition for their expertise 

in health care labor market analysis, including health 

care workforce analysis; health care finance and 
H. R. 3590—475 

economics; health care facility management; health 

care plans and integrated delivery systems; health care 

workforce education and training; health care philanthropy; providers of health care services; and other 

related fields; and 

(ii) who will provide a combination of professional 

perspectives, broad geographic representation, and a 

balance between urban, suburban, rural, and frontier 

representatives. 

(B) INCLUSION.— 

(i) IN GENERAL.—The membership of the Commission shall include no less than one representative of— 

(I) the health care workforce and health 

professionals; 

(II) employers; 

(III) third-party payers; 

(IV) individuals skilled in the conduct and 

interpretation of health care services and health 

economics research; 

(V) representatives of consumers; 

(VI) labor unions; 

(VII) State or local workforce investment 

boards; and 

(VIII) educational institutions (which may 

include elementary and secondary institutions, 

institutions of higher education, including 2 and 

4 year institutions, or registered apprenticeship 

programs). 

(ii) ADDITIONAL MEMBERS.—The remaining membership may include additional representatives from 

clause (i) and other individuals as determined appropriate by the Comptroller General of the United States. 

(C) MAJORITY NON-PROVIDERS.—Individuals who are 

directly involved in health professions education or practice 

shall not constitute a majority of the membership of the 

Commission. 

(D) ETHICAL DISCLOSURE.—The Comptroller General 

shall establish a system for public disclosure by members 

of the Commission of financial and other potential conflicts 

of interest relating to such members. Members of the 

Commission shall be treated as employees of Congress 

for purposes of applying title I of the Ethics in Government 

Act of 1978. Members of the Commission shall not be 

treated as special government employees under title 18, 

United States Code. 

(3) TERMS.— 

(A) IN GENERAL.—The terms of members of the 

Commission shall be for 3 years except that the Comptroller 

General shall designate staggered terms for the members 

first appointed. 

(B) VACANCIES.—Any member appointed to fill a 

vacancy occurring before the expiration of the term for 

which the member’s predecessor was appointed shall be 

appointed only for the remainder of that term. A member 

may serve after the expiration of that member’s term until 

a successor has taken office. A vacancy in the Commission 
H. R. 3590—476 

shall be filled in the manner in which the original appointment was made. 

(C) INITIAL APPOINTMENTS.—The Comptroller General 

shall make initial appointments of members to the Commission not later than September 30, 2010. 

(4) COMPENSATION.—While serving on the business of the 

Commission (including travel time), a member of the Commission shall be entitled to compensation at the per diem equivalent of the rate provided for level IV of the Executive Schedule 

under section 5315 of tile 5, United States Code, and while 

so serving away from home and the member’s regular place 

of business, a member may be allowed travel expenses, as 

authorized by the Chairman of the Commission. Physicians 

serving as personnel of the Commission may be provided a 

physician comparability allowance by the Commission in the 

same manner as Government physicians may be provided such 

an allowance by an agency under section 5948 of title 5, United 

States Code, and for such purpose subsection (i) of such section 

shall apply to the Commission in the same manner as it applies 

to the Tennessee Valley Authority. For purposes of pay (other 

than pay of members of the Commission) and employment 

benefits, rights, and privileges, all personnel of the Commission 

shall be treated as if they were employees of the United States 

Senate. Personnel of the Commission shall not be treated as 

employees of the Government Accountability Office for any 

purpose. 

(5) CHAIRMAN, VICE CHAIRMAN.—The Comptroller General 

shall designate a member of the Commission, at the time of 

appointment of the member, as Chairman and a member as 

Vice Chairman for that term of appointment, except that in 

the case of vacancy of the chairmanship or vice chairmanship, 

the Comptroller General may designate another member for 

the remainder of that member’s term. 

(6) MEETINGS.—The Commission shall meet at the call 

of the chairman, but no less frequently than on a quarterly 

basis. 

(d) DUTIES.— 

(1) RECOGNITION, DISSEMINATION, AND COMMUNICATION.— 

The Commission shall— 

(A) recognize efforts of Federal, State, and local partnerships to develop and offer health care career pathways 

of proven effectiveness; 

(B) disseminate information on promising retention 

practices for health care professionals; and 

(C) communicate information on important policies and 

practices that affect the recruitment, education and 

training, and retention of the health care workforce. 

(2) REVIEW OF HEALTH CARE WORKFORCE AND ANNUAL

REPORTS.—In order to develop a fiscally sustainable integrated 

workforce that supports a high-quality, readily accessible health 

care delivery system that meets the needs of patients and 

populations, the Commission, in consultation with relevant Federal, State, and local agencies, shall— 

(A) review current and projected health care workforce 

supply and demand, including the topics described in paragraph (3); 
H. R. 3590—477 

(B) make recommendations to Congress and the 

Administration concerning national health care workforce 

priorities, goals, and policies; 

(C) by not later than October 1 of each year (beginning 

with 2011), submit a report to Congress and the Administration containing the results of such reviews and recommendations concerning related policies; and 

(D) by not later than April 1 of each year (beginning 

with 2011), submit a report to Congress and the Administration containing a review of, and recommendations on, 

at a minimum one high priority area as described in paragraph (4). 

(3) SPECIFIC TOPICS TO BE REVIEWED.—The topics described 

in this paragraph include— 

(A) current health care workforce supply and distribution, including demographics, skill sets, and demands, with 

projected demands during the subsequent 10 and 25 year 

periods; 

(B) health care workforce education and training 

capacity, including the number of students who have completed education and training, including registered 

apprenticeships; the number of qualified faculty; the education and training infrastructure; and the education and 

training demands, with projected demands during the subsequent 10 and 25 year periods; 

(C) the education loan and grant programs in titles 

VII and VIII of the Public Health Service Act (42 U.S.C. 

292 et seq. and 296 et seq.), with recommendations on 

whether such programs should become part of the Higher 

Education Act of 1965 (20 U.S.C. 1001 et seq); 

(D) the implications of new and existing Federal policies which affect the health care workforce, including Medicare and Medicaid graduate medical education policies, 

titles VII and VIII of the Public Health Service Act (42 

U.S.C. 292 et seq. and 296 et seq.), the National Health 

Service Corps (with recommendations for aligning such 

programs with national health workforce priorities and 

goals), and other health care workforce programs, including 

those supported through the Workforce Investment Act 

of 1998 (29 U.S.C. 2801 et seq.), the Carl D. Perkins 

Career and Technical Education Act of 2006 (20 U.S.C. 

2301 et seq.), the Higher Education Act of 1965 (20 U.S.C. 

1001 et seq.), and any other Federal health care workforce 

programs; 

(E) the health care workforce needs of special populations, such as minorities, rural populations, medically 

underserved populations, gender specific needs, individuals 

with disabilities, and geriatric and pediatric populations 

with recommendations for new and existing Federal policies 

to meet the needs of these special populations; and 

(F) recommendations creating or revising national loan 

repayment programs and scholarship programs to require 

low-income, minority medical students to serve in their 

home communities, if designated as medical underserved 

community. 

(4) HIGH PRIORITY AREAS.— 
H. R. 3590—478 

(A) IN GENERAL.—The initial high priority topics 

described in this paragraph include each of the following: 

(i) Integrated health care workforce planning that 

identifies health care professional skills needed and 

maximizes the skill sets of health care professionals 

across disciplines. 

(ii) An analysis of the nature, scopes of practice, 

and demands for health care workers in the enhanced 

information technology and management workplace. 

(iii) An analysis of how to align Medicare and 

Medicaid graduate medical education policies with 

national workforce goals. 

(iv) The education and training capacity, projected 

demands, and integration with the health care delivery 

system of each of the following: 

(I) Nursing workforce capacity at all levels. 

(II) Oral health care workforce capacity at all 

levels. 

(III) Mental and behavioral health care 

workforce capacity at all levels. 

(IV) Allied health and public health care 

workforce capacity at all levels. 

(V) Emergency medical service workforce 

capacity, including the retention and recruitment 

of the volunteer workforce, at all levels. 

(VI) The geographic distribution of health care 

providers as compared to the identified health care 

workforce needs of States and regions. 

(B) FUTURE DETERMINATIONS.—The Commission may 

require that additional topics be included under subparagraph (A). The appropriate committees of Congress may 

recommend to the Commission the inclusion of other topics 

for health care workforce development areas that require 

special attention. 

(5) GRANT PROGRAM.—The Commission shall— 

(A) review implementation progress reports on, and 

report to Congress about, the State Health Care Workforce 

Development Grant program established in section 5102; 

(B) in collaboration with the Department of Labor and 

in coordination with the Department of Education and 

other relevant Federal agencies, make recommendations 

to the fiscal and administrative agent under section 5102(b) 

for grant recipients under section 5102; 

(C) assess the implementation of the grants under 

such section; and 

(D) collect performance and report information, 

including identified models and best practices, on grants 

from the fiscal and administrative agent under such section 

and distribute this information to Congress, relevant Federal agencies, and to the public. 

(6) STUDY.—The Commission shall study effective mechanisms for financing education and training for careers in health 

care, including public health and allied health. 

(7) RECOMMENDATIONS.—The Commission shall submit recommendations to Congress, the Department of Labor, and the 

Department of Health and Human Services about improving 
H. R. 3590—479 

safety, health, and worker protections in the workplace for 

the health care workforce. 

(8) ASSESSMENT.—The Commission shall assess and receive 

reports from the National Center for Health Care Workforce 

Analysis established under section 761(b) of the Public Service 

Health Act (as amended by section 5103). 

(e) CONSULTATION WITH FEDERAL, STATE, AND LOCAL AGENCIES, 

CONGRESS, AND OTHER ORGANIZATIONS.— 

(1) IN GENERAL.—The Commission shall consult with Federal agencies (including the Departments of Health and Human 

Services, Labor, Education, Commerce, Agriculture, Defense, 

and Veterans Affairs and the Environmental Protection 

Agency), Congress, the Medicare Payment Advisory Commission, the Medicaid and CHIP Payment and Access Commission, 

and, to the extent practicable, with State and local agencies, 

Indian tribes, voluntary health care organizations, professional 

societies, and other relevant public-private health care partnerships. 

(2) OBTAINING OFFICIAL DATA.—The Commission, consistent 

with established privacy rules, may secure directly from any 

department or agency of the Executive Branch information 

necessary to enable the Commission to carry out this section. 

(3) DETAIL OF FEDERAL GOVERNMENT EMPLOYEES.—An 

employee of the Federal Government may be detailed to the 

Commission without reimbursement. The detail of such an 

employee shall be without interruption or loss of civil service 

status. 

(f) DIRECTOR AND STAFF; EXPERTS AND CONSULTANTS.—Subject 

to such review as the Comptroller General of the United States 

determines to be necessary to ensure the efficient administration 

of the Commission, the Commission may— 

(1) employ and fix the compensation of an executive director 

that shall not exceed the rate of basic pay payable for level 

V of the Executive Schedule and such other personnel as may 

be necessary to carry out its duties (without regard to the 

provisions of title 5, United States Code, governing appointments in the competitive service); 

(2) seek such assistance and support as may be required 

in the performance of its duties from appropriate Federal 

departments and agencies; 

(3) enter into contracts or make other arrangements, as 

may be necessary for the conduct of the work of the Commission 

(without regard to section 3709 of the Revised Statutes (41 

U.S.C. 5)); 

(4) make advance, progress, and other payments which 

relate to the work of the Commission; 

(5) provide transportation and subsistence for persons 

serving without compensation; and 

(6) prescribe such rules and regulations as the Commission 

determines to be necessary with respect to the internal 

organization and operation of the Commission. 

(g) POWERS.— (1) DATA COLLECTION.—In order to carry out its functions 

under this section, the Commission shall— 

(A) utilize existing information, both published and 

unpublished, where possible, collected and assessed either 

by its own staff or under other arrangements made in 
H. R. 3590—480 

accordance with this section, including coordination with 

the Bureau of Labor Statistics; 

(B) carry out, or award grants or contracts for the 

carrying out of, original research and development, where 

existing information is inadequate, and 

(C) adopt procedures allowing interested parties to 

submit information for the Commission’s use in making 

reports and recommendations. 

(2) ACCESS OF THE GOVERNMENT ACCOUNTABILITY OFFICE

TO INFORMATION.—The Comptroller General of the United 

States shall have unrestricted access to all deliberations, 

records, and data of the Commission, immediately upon request. 

(3) PERIODIC AUDIT.—The Commission shall be subject to 

periodic audit by an independent public accountant under contract to the Commission. 

(h) AUTHORIZATION OF APPROPRIATIONS.— 

(1) REQUEST FOR APPROPRIATIONS.—The Commission shall 

submit requests for appropriations in the same manner as 

the Comptroller General of the United States submits requests 

for appropriations. Amounts so appropriated for the Commission shall be separate from amounts appropriated for the Comptroller General. 

(2) AUTHORIZATION.—There are authorized to be appropriated such sums as may be necessary to carry out this section. 

(3) GIFTS AND SERVICES.—The Commission may not accept 

gifts, bequeaths, or donations of property, but may accept and 

use donations of services for purposes of carrying out this 

section. 

(i) DEFINITIONS.—In this section: 

(1) HEALTH CARE WORKFORCE.—The term ‘‘health care 

workforce’’ includes all health care providers with direct patient 

care and support responsibilities, such as physicians, nurses, 

nurse practitioners, primary care providers, preventive medicine physicians, optometrists, ophthalmologists, physician 

assistants, pharmacists, dentists, dental hygienists, and other 

oral healthcare professionals, allied health professionals, doctors of chiropractic, community health workers, health care 

paraprofessionals, direct care workers, psychologists and other 

behavioral and mental health professionals (including substance abuse prevention and treatment providers), social 

workers, physical and occupational therapists, certified nurse 

midwives, podiatrists, the EMS workforce (including professional and volunteer ambulance personnel and firefighters who 

perform emergency medical services), licensed complementary 

and alternative medicine providers, integrative health practitioners, public health professionals, and any other health 

professional that the Comptroller General of the United States 

determines appropriate. 

(2) HEALTH PROFESSIONALS.—The term ‘‘health professionals’’ includes— 

(A) dentists, dental hygienists, primary care providers, 

specialty physicians, nurses, nurse practitioners, physician 

assistants, psychologists and other behavioral and mental 

health professionals (including substance abuse prevention 

and treatment providers), social workers, physical and 

occupational therapists, public health professionals, clinical 
H. R. 3590—481 

pharmacists, allied health professionals, doctors of chiropractic, community health workers, school nurses, certified 

nurse midwives, podiatrists, licensed complementary and 

alternative medicine providers, the EMS workforce 

(including professional and volunteer ambulance personnel 

and firefighters who perform emergency medical services), 

and integrative health practitioners; 

(B) national representatives of health professionals; 

(C) representatives of schools of medicine, osteopathy, 

nursing, dentistry, optometry, pharmacy, chiropractic, 

allied health, educational programs for public health professionals, behavioral and mental health professionals (as so 

defined), social workers, pharmacists, physical and occupational therapists, oral health care industry dentistry and 

dental hygiene, and physician assistants; 

(D) representatives of public and private teaching hospitals, and ambulatory health facilities, including Federal 

medical facilities; and 

(E) any other health professional the Comptroller General of the United States determines appropriate. 

SEC. 5102. STATE HEALTH CARE WORKFORCE DEVELOPMENT GRANTS. 

(a) ESTABLISHMENT.—There is established a competitive health 

care workforce development grant program (referred to in this section as the ‘‘program’’) for the purpose of enabling State partnerships to complete comprehensive planning and to carry out activities 

leading to coherent and comprehensive health care workforce 

development strategies at the State and local levels. 

(b) FISCAL AND ADMINISTRATIVE AGENT.—The Health Resources 

and Services Administration of the Department of Health and 

Human Services (referred to in this section as the ‘‘Administration’’) 

shall be the fiscal and administrative agent for the grants awarded 

under this section. The Administration is authorized to carry out 

the program, in consultation with the National Health Care 

Workforce Commission (referred to in this section as the ‘‘Commission’’), which shall review reports on the development, implementation, and evaluation activities of the grant program, including— 

(1) administering the grants; 

(2) providing technical assistance to grantees; and 

(3) reporting performance information to the Commission. 

(c) PLANNING GRANTS.— 

(1) AMOUNT AND DURATION.—A planning grant shall be 

awarded under this subsection for a period of not more than 

one year and the maximum award may not be more than 

$150,000. 

(2) ELIGIBILITY.—To be eligible to receive a planning grant, 

an entity shall be an eligible partnership. An eligible partnership shall be a State workforce investment board, if it includes 

or modifies the members to include at least one representative 

from each of the following: health care employer, labor organization, a public 2-year institution of higher education, a public 

4-year institution of higher education, the recognized State 

federation of labor, the State public secondary education agency, 

the State P–16 or P–20 Council if such a council exists, and 

a philanthropic organization that is actively engaged in providing learning, mentoring, and work opportunities to recruit, 
H. R. 3590—482 

educate, and train individuals for, and retain individuals in, 

careers in health care and related industries. 

(3) FISCAL AND ADMINISTRATIVE AGENT.—The Governor of 

the State receiving a planning grant has the authority to 

appoint a fiscal and an administrative agency for the partnership. 

(4) APPLICATION.—Each State partnership desiring a planning grant shall submit an application to the Administrator 

of the Administration at such time and in such manner, and 

accompanied by such information as the Administrator may 

reasonable require. Each application submitted for a planning 

grant shall describe the members of the State partnership, 

the activities for which assistance is sought, the proposed 

performance benchmarks to be used to measure progress under 

the planning grant, a budget for use of the funds to complete 

the required activities described in paragraph (5), and such 

additional assurance and information as the Administrator 

determines to be essential to ensure compliance with the grant 

program requirements. 

(5) REQUIRED ACTIVITIES.—A State partnership receiving 

a planning grant shall carry out the following: 

(A) Analyze State labor market information in order 

to create health care career pathways for students and 

adults, including dislocated workers. 

(B) Identify current and projected high demand State 

or regional health care sectors for purposes of planning 

career pathways. 

(C) Identify existing Federal, State, and private 

resources to recruit, educate or train, and retain a skilled 

health care workforce and strengthen partnerships. 

(D) Describe the academic and health care industry 

skill standards for high school graduation, for entry into 

postsecondary education, and for various credentials and 

licensure. 

(E) Describe State secondary and postsecondary education and training policies, models, or practices for the 

health care sector, including career information and guidance counseling. 

(F) Identify Federal or State policies or rules to developing a coherent and comprehensive health care workforce 

development strategy and barriers and a plan to resolve 

these barriers. 

(G) Participate in the Administration’s evaluation and 

reporting activities. 

(6) PERFORMANCE AND EVALUATION.—Before the State partnership receives a planning grant, such partnership and the 

Administrator of the Administration shall jointly determine 

the performance benchmarks that will be established for the 

purposes of the planning grant. 

(7) MATCH.—Each State partnership receiving a planning 

grant shall provide an amount, in cash or in kind, that is 

not less that 15 percent of the amount of the grant, to carry 

out the activities supported by the grant. The matching requirement may be provided from funds available under other Federal, State, local or private sources to carry out the activities. 

(8) REPORT.— 
H. R. 3590—483 

(A) REPORT TO ADMINISTRATION.—Not later than 1 year 

after a State partnership receives a planning grant, the 

partnership shall submit a report to the Administration 

on the State’s performance of the activities under the grant, 

including the use of funds, including matching funds, to 

carry out required activities, and a description of the 

progress of the State workforce investment board in 

meeting the performance benchmarks. 

(B) REPORT TO CONGRESS.—The Administration shall 

submit a report to Congress analyzing the planning activities, performance, and fund utilization of each State grant 

recipient, including an identification of promising practices 

and a profile of the activities of each State grant recipient. 

(d) IMPLEMENTATION GRANTS.— 

(1) IN GENERAL.—The Administration shall— 

(A) competitively award implementation grants to 

State partnerships to enable such partnerships to implement activities that will result in a coherent and comprehensive plan for health workforce development that will 

address current and projected workforce demands within 

the State; and 

(B) inform the Commission and Congress about the 

awards made. 

(2) DURATION.—An implementation grant shall be awarded 

for a period of no more than 2 years, except in those cases 

where the Administration determines that the grantee is high 

performing and the activities supported by the grant warrant 

up to 1 additional year of funding. 

(3) ELIGIBILITY.—To be eligible for an implementation 

grant, a State partnership shall have— 

(A) received a planning grant under subsection (c) and 

completed all requirements of such grant; or 

(B) completed a satisfactory application, including a 

plan to coordinate with required partners and complete 

the required activities during the 2 year period of the 

implementation grant. 

(4) FISCAL AND ADMINISTRATIVE AGENT.—A State partnership receiving an implementation grant shall appoint a fiscal 

and an administration agent for the implementation of such 

grant. 

(5) APPLICATION.—Each eligible State partnership desiring 

an implementation grant shall submit an application to the 

Administration at such time, in such manner, and accompanied 

by such information as the Administration may reasonably 

require. Each application submitted shall include— 

(A) a description of the members of the State partnership; 

(B) a description of how the State partnership completed the required activities under the planning grant, 

if applicable; 

(C) a description of the activities for which implementation grant funds are sought, including grants to regions 

by the State partnership to advance coherent and comprehensive regional health care workforce planning activities; 

(D) a description of how the State partnership will 

coordinate with required partners and complete the 
H. R. 3590—484 

required partnership activities during the duration of an 

implementation grant; 

(E) a budget proposal of the cost of the activities supported by the implementation grant and a timeline for 

the provision of matching funds required; 

(F) proposed performance benchmarks to be used to 

assess and evaluate the progress of the partnership activities; 

(G) a description of how the State partnership will 

collect data to report progress in grant activities; and 

(H) such additional assurances as the Administration 

determines to be essential to ensure compliance with grant 

requirements. 

(6) REQUIRED ACTIVITIES.— 

(A) IN GENERAL.—A State partnership that receives 

an implementation grant may reserve not less than 60 

percent of the grant funds to make grants to be competitively awarded by the State partnership, consistent with 

State procurement rules, to encourage regional partnerships to address health care workforce development needs 

and to promote innovative health care workforce career 

pathway activities, including career counseling, learning, 

and employment. 

(B) ELIGIBLE PARTNERSHIP DUTIES.—An eligible State 

partnership receiving an implementation grant shall— 

(i) identify and convene regional leadership to discuss opportunities to engage in statewide health care 

workforce development planning, including the potential use of competitive grants to improve the development, distribution, and diversity of the regional health 

care workforce; the alignment of curricula for health 

care careers; and the access to quality career information and guidance and education and training 

opportunities; 

(ii) in consultation with key stakeholders and 

regional leaders, take appropriate steps to reduce Federal, State, or local barriers to a comprehensive and 

coherent strategy, including changes in State or local 

policies to foster coherent and comprehensive health 

care workforce development activities, including health 

care career pathways at the regional and State levels, 

career planning information, retraining for dislocated 

workers, and as appropriate, requests for Federal program or administrative waivers; 

(iii) develop, disseminate, and review with key 

stakeholders a preliminary statewide strategy that 

addresses short- and long-term health care workforce 

development supply versus demand; 

(iv) convene State partnership members on a regular basis, and at least on a semiannual basis; 

(v) assist leaders at the regional level to form 

partnerships, including technical assistance and 

capacity building activities; 
H. R. 3590—485 

(vi) collect and assess data on and report on the 

performance benchmarks selected by the State partnership and the Administration for implementation activities carried out by regional and State partnerships; 

and 

(vii) participate in the Administration’s evaluation 

and reporting activities. 

(7) PERFORMANCE AND EVALUATION.—Before the State partnership receives an implementation grant, it and the Administrator shall jointly determine the performance benchmarks that 

shall be established for the purposes of the implementation 

grant. 

(8) MATCH.—Each State partnership receiving an 

implementation grant shall provide an amount, in cash or 

in kind that is not less than 25 percent of the amount of 

the grant, to carry out the activities supported by the grant. 

The matching funds may be provided from funds available 

from other Federal, State, local, or private sources to carry 

out such activities. 

(9) REPORTS.— 

(A) REPORT TO ADMINISTRATION.—For each year of the 

implementation grant, the State partnership receiving the 

implementation grant shall submit a report to the Administration on the performance of the State of the grant activities, including a description of the use of the funds, 

including matched funds, to complete activities, and a 

description of the performance of the State partnership 

in meeting the performance benchmarks. 

(B) REPORT TO CONGRESS.—The Administration shall 

submit a report to Congress analyzing implementation 

activities, performance, and fund utilization of the State 

grantees, including an identification of promising practices 

and a profile of the activities of each State grantee. 

(e) AUTHORIZATION FOR APPROPRIATIONS.— 

(1) PLANNING GRANTS.—There are authorized to be appropriated to award planning grants under subsection (c) 

$8,000,000 for fiscal year 2010, and such sums as may be 

necessary for each subsequent fiscal year. 

(2) IMPLEMENTATION GRANTS.—There are authorized to be 

appropriated to award implementation grants under subsection 

(d), $150,000,000 for fiscal year 2010, and such sums as may 

be necessary for each subsequent fiscal year. 

SEC. 5103. HEALTH CARE WORKFORCE ASSESSMENT. 

(a) IN GENERAL.—Section 761 of the Public Health Service 

Act (42 U.S.C. 294m) is amended— 

(1) by redesignating subsection (c) as subsection (e); 

(2) by striking subsection (b) and inserting the following: 

‘‘(b) NATIONAL CENTER FOR HEALTH CARE WORKFORCE ANALYSIS.— 

‘‘(1) ESTABLISHMENT.—The Secretary shall establish the 

National Center for Health Workforce Analysis (referred to 

in this section as the ‘National Center’). 

‘‘(2) PURPOSES.—The National Center, in coordination to 

the extent practicable with the National Health Care Workforce 
H. R. 3590—486 

Commission (established in section 5101 of the Patient Protection and Affordable Care Act), and relevant regional and State 

centers and agencies, shall— 

‘‘(A) provide for the development of information 

describing and analyzing the health care workforce and 

workforce related issues; 

‘‘(B) carry out the activities under section 792(a); 

‘‘(C) annually evaluate programs under this title; 

‘‘(D) develop and publish performance measures and 

benchmarks for programs under this title; and 

‘‘(E) establish, maintain, and publicize a national Internet registry of each grant awarded under this title and 

a database to collect data from longitudinal evaluations 

(as described in subsection (d)(2)) on performance measures 

(as developed under sections 749(d)(3), 757(d)(3), and 

762(a)(3)). 

‘‘(3) COLLABORATION AND DATA SHARING.— 

‘‘(A) IN GENERAL.—The National Center shall collaborate with Federal agencies and relevant professional and 

educational organizations or societies for the purpose of 

linking data regarding grants awarded under this title. 

‘‘(B) CONTRACTS FOR HEALTH WORKFORCE ANALYSIS.— 

For the purpose of carrying out the activities described 

in subparagraph (A), the National Center may enter into 

contracts with relevant professional and educational 

organizations or societies. 

‘‘(c) STATE AND REGIONAL CENTERS FOR HEALTH WORKFORCE

ANALYSIS.— 

‘‘(1) IN GENERAL.—The Secretary shall award grants to, 

or enter into contracts with, eligible entities for purposes of— 

‘‘(A) collecting, analyzing, and reporting data regarding 

programs under this title to the National Center and to 

the public; and 

‘‘(B) providing technical assistance to local and regional 

entities on the collection, analysis, and reporting of data. 

‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a grant or contract under this subsection, an entity shall— 

‘‘(A) be a State, a State workforce investment board, 

a public health or health professions school, an academic 

health center, or an appropriate public or private nonprofit 

entity; and 

‘‘(B) submit to the Secretary an application at such 

time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(d) INCREASE IN GRANTS FOR LONGITUDINAL EVALUATIONS.— 

‘‘(1) IN GENERAL.—The Secretary shall increase the amount 

awarded to an eligible entity under this title for a longitudinal 

evaluation of individuals who have received education, training, 

or financial assistance from programs under this title. 

‘‘(2) CAPABILITY.—A longitudinal evaluation shall be 

capable of— 

‘‘(A) studying practice patterns; and 

‘‘(B) collecting and reporting data on performance 

measures developed under sections 749(d)(3), 757(d)(3), and 

762(a)(3). 
H. R. 3590—487 

‘‘(3) GUIDELINES.—A longitudinal evaluation shall comply 

with guidelines issued under sections 749(d)(4), 757(d)(4), and 

762(a)(4). 

‘‘(4) ELIGIBLE ENTITIES.—To be eligible to obtain an increase 

under this section, an entity shall be a recipient of a grant 

or contract under this title.’’; and 

(3) in subsection (e), as so redesignated— 

(A) by striking paragraph (1) and inserting the following: 

‘‘(1) IN GENERAL.— 

‘‘(A) NATIONAL CENTER.—To carry out subsection (b), 

there are authorized to be appropriated $7,500,000 for each 

of fiscal years 2010 through 2014. 

‘‘(B) STATE AND REGIONAL CENTERS.—To carry out subsection (c), there are authorized to be appropriated 

$4,500,000 for each of fiscal years 2010 through 2014. 

‘‘(C) GRANTS FOR LONGITUDINAL EVALUATIONS.—To 

carry out subsection (d), there are authorized to be appropriated such sums as may be necessary for fiscal years 

2010 through 2014.’’; and 

(4) in paragraph (2), by striking ‘‘subsection (a)’’ and 

inserting ‘‘paragraph (1)’’. 

(b) TRANSFERS.—Not later than 180 days after the date of 

enactment of this Act, the responsibilities and resources of the 

National Center for Health Workforce Analysis, as in effect on 

the date before the date of enactment of this Act, shall be transferred to the National Center for Health Care Workforce Analysis 

established under section 761 of the Public Health Service Act, 

as amended by subsection (a). 

(c) USE OF LONGITUDINAL EVALUATIONS.—Section 791(a)(1) of 

the Public Health Service Act (42 U.S.C. 295j(a)(1)) is amended— 

(1) in subparagraph (A), by striking ‘‘or’’ at the end; 

(2) in subparagraph (B), by striking the period and 

inserting ‘‘; or’’; and 

(3) by adding at the end the following: 

‘‘(C) utilizes a longitudinal evaluation (as described 

in section 761(d)(2)) and reports data from such system 

to the national workforce database (as established under 

section 761(b)(2)(E)).’’. 

(d) PERFORMANCE MEASURES; GUIDELINES FOR LONGITUDINAL

EVALUATIONS.— 

(1) ADVISORY COMMITTEE ON TRAINING IN PRIMARY CARE

MEDICINE AND DENTISTRY.—Section 748(d) of the Public Health 

Service Act is amended— 

(A) in paragraph (1), by striking ‘‘and’’ at the end; 

(B) in paragraph (2), by striking the period and 

inserting a semicolon; and 

(C) by adding at the end the following: 

‘‘(3) develop, publish, and implement performance measures 

for programs under this part; 

‘‘(4) develop and publish guidelines for longitudinal evaluations (as described in section 761(d)(2)) for programs under 

this part; and 

‘‘(5) recommend appropriation levels for programs under 

this part.’’. 
H. R. 3590—488 

(2) ADVISORY COMMITTEE ON INTERDISCIPLINARY, COMMU- NITY-BASED LINKAGES.—Section 756(d) of the Public Health 

Service Act is amended— 

(A) in paragraph (1), by striking ‘‘and’’ at the end; 

(B) in paragraph (2), by striking the period and 

inserting a semicolon; and 

(C) by adding at the end the following: 

‘‘(3) develop, publish, and implement performance measures 

for programs under this part; 

‘‘(4) develop and publish guidelines for longitudinal evaluations (as described in section 761(d)(2)) for programs under 

this part; and 

‘‘(5) recommend appropriation levels for programs under 

this part.’’. 

(3) ADVISORY COUNCIL ON GRADUATE MEDICAL EDUCATION.— Section 762(a) of the Public Health Service Act (42 U.S.C. 

294o(a)) is amended— 

(A) in paragraph (1), by striking ‘‘and’’ at the end; 

(B) in paragraph (2), by striking the period and 

inserting a semicolon; and 

(C) by adding at the end the following: 

‘‘(3) develop, publish, and implement performance measures 

for programs under this title, except for programs under part 

C or D; 

‘‘(4) develop and publish guidelines for longitudinal evaluations (as described in section 761(d)(2)) for programs under 

this title, except for programs under part C or D; and 

‘‘(5) recommend appropriation levels for programs under 

this title, except for programs under part C or D.’’. 

Subtitle C—Increasing the Supply of the 

Health Care Workforce 

SEC. 5201. FEDERALLY SUPPORTED STUDENT LOAN FUNDS. 

(a) MEDICAL SCHOOLS AND PRIMARY HEALTH CARE.—Section 

723 of the Public Health Service Act (42 U.S.C. 292s) is amended— 

(1) in subsection (a)— 

(A) in paragraph (1), by striking subparagraph (B) 

and inserting the following: 

‘‘(B) to practice in such care for 10 years (including 

residency training in primary health care) or through the 

date on which the loan is repaid in full, whichever occurs 

first.’’; and 

(B) by striking paragraph (3) and inserting the following: 

‘‘(3) NONCOMPLIANCE BY STUDENT.—Each agreement 

entered into with a student pursuant to paragraph (1) shall 

provide that, if the student fails to comply with such agreement, 

the loan involved will begin to accrue interest at a rate of 

2 percent per year greater than the rate at which the student 

would pay if compliant in such year.’’; and 

(2) by adding at the end the following: 

‘‘(d) SENSE OF CONGRESS.—It is the sense of Congress that 

funds repaid under the loan program under this section should 

not be transferred to the Treasury of the United States or otherwise 

used for any other purpose other than to carry out this section.’’. 
H. R. 3590—489 

(b) STUDENT LOAN GUIDELINES.—The Secretary of Health and 

Human Services shall not require parental financial information 

for an independent student to determine financial need under section 723 of the Public Health Service Act (42 U.S.C. 292s) and 

the determination of need for such information shall be at the 

discretion of applicable school loan officer. The Secretary shall 

amend guidelines issued by the Health Resources and Services 

Administration in accordance with the preceding sentence. 

SEC. 5202. NURSING STUDENT LOAN PROGRAM. 

(a) LOAN AGREEMENTS.—Section 836(a) of the Public Health 

Service Act (42 U.S.C. 297b(a)) is amended— 

(1) by striking ‘‘$2,500’’ and inserting ‘‘$3,300’’; 

(2) by striking ‘‘$4,000’’ and inserting ‘‘$5,200’’; and 

(3) by striking ‘‘$13,000’’ and all that follows through the 

period and inserting ‘‘$17,000 in the case of any student during 

fiscal years 2010 and 2011. After fiscal year 2011, such amounts 

shall be adjusted to provide for a cost-of-attendance increase 

for the yearly loan rate and the aggregate of the loans.’’. 

(b) LOAN PROVISIONS.—Section 836(b) of the Public Health 

Service Act (42 U.S.C. 297b(b)) is amended— 

(1) in paragraph (1)(C), by striking ‘‘1986’’ and inserting 

‘‘2000’’; and 

(2) in paragraph (3), by striking ‘‘the date of enactment 

of the Nurse Training Amendments of 1979’’ and inserting 

‘‘September 29, 1995’’. 

SEC. 5203. HEALTH CARE WORKFORCE LOAN REPAYMENT PROGRAMS. 

Part E of title VII of the Public Health Service Act (42 U.S.C. 

294n et seq.) is amended by adding at the end the following: 

‘‘Subpart 3—Recruitment and Retention Programs 

‘‘SEC. 775. INVESTMENT IN TOMORROW’S PEDIATRIC HEALTH CARE 

WORKFORCE. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish and carry 

out a pediatric specialty loan repayment program under which 

the eligible individual agrees to be employed full-time for a specified 

period (which shall not be less than 2 years) in providing pediatric 

medical subspecialty, pediatric surgical specialty, or child and 

adolescent mental and behavioral health care, including substance 

abuse prevention and treatment services. 

‘‘(b) PROGRAM ADMINISTRATION.—Through the program established under this section, the Secretary shall enter into contracts 

with qualified health professionals under which— 

‘‘(1) such qualified health professionals will agree to provide 

pediatric medical subspecialty, pediatric surgical specialty, or 

child and adolescent mental and behavioral health care in 

an area with a shortage of the specified pediatric subspecialty 

that has a sufficient pediatric population to support such pediatric subspecialty, as determined by the Secretary; and 

‘‘(2) the Secretary agrees to make payments on the principal 

and interest of undergraduate, graduate, or graduate medical 

education loans of professionals described in paragraph (1) 

of not more than $35,000 a year for each year of agreed upon 

service under such paragraph for a period of not more than 

3 years during the qualified health professional’s— 
H. R. 3590—490 

‘‘(A) participation in an accredited pediatric medical 

subspecialty, pediatric surgical specialty, or child and 

adolescent mental health subspecialty residency or fellowship; or 

‘‘(B) employment as a pediatric medical subspecialist, 

pediatric surgical specialist, or child and adolescent mental 

health professional serving an area or population described 

in such paragraph. 

‘‘(c) IN GENERAL.— 

‘‘(1) ELIGIBLE INDIVIDUALS.— 

‘‘(A) PEDIATRIC MEDICAL SPECIALISTS AND PEDIATRIC

SURGICAL SPECIALISTS.—For purposes of contracts with 

respect to pediatric medical specialists and pediatric surgical specialists, the term ‘qualified health professional’ 

means a licensed physician who— 

‘‘(i) is entering or receiving training in an accredited pediatric medical subspecialty or pediatric surgical 

specialty residency or fellowship; or 

‘‘(ii) has completed (but not prior to the end of 

the calendar year in which this section is enacted) 

the training described in subparagraph (B). 

‘‘(B) CHILD AND ADOLESCENT MENTAL AND BEHAVIORAL

HEALTH.—For purposes of contracts with respect to child 

and adolescent mental and behavioral health care, the 

term ‘qualified health professional’ means a health care 

professional who— 

‘‘(i) has received specialized training or clinical 

experience in child and adolescent mental health in 

psychiatry, psychology, school psychology, behavioral 

pediatrics, psychiatric nursing, social work, school 

social work, substance abuse disorder prevention and 

treatment, marriage and family therapy, school counseling, or professional counseling; 

‘‘(ii) has a license or certification in a State to 

practice allopathic medicine, osteopathic medicine, psychology, school psychology, psychiatric nursing, social 

work, school social work, marriage and family therapy, 

school counseling, or professional counseling; or 

‘‘(iii) is a mental health service professional who 

completed (but not before the end of the calendar year 

in which this section is enacted) specialized training 

or clinical experience in child and adolescent mental 

health described in clause (i). 

‘‘(2) ADDITIONAL ELIGIBILITY REQUIREMENTS.—The Secretary may not enter into a contract under this subsection 

with an eligible individual unless— 

‘‘(A) the individual agrees to work in, or for a provider 

serving, a health professional shortage area or medically 

underserved area, or to serve a medically underserved 

population; 

‘‘(B) the individual is a United States citizen or a 

permanent legal United States resident; and 

‘‘(C) if the individual is enrolled in a graduate program, 

the program is accredited, and the individual has an acceptable level of academic standing (as determined by the Secretary). 
H. R. 3590—491 

‘‘(d) PRIORITY.—In entering into contracts under this subsection, 

the Secretary shall give priority to applicants who— 

‘‘(1) are or will be working in a school or other pre-kindergarten, elementary, or secondary education setting; 

‘‘(2) have familiarity with evidence-based methods and cultural and linguistic competence health care services; and 

‘‘(3) demonstrate financial need. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated $30,000,000 for each of fiscal years 2010 through 

2014 to carry out subsection (c)(1)(A) and $20,000,000 for each 

of fiscal years 2010 through 2013 to carry out subsection (c)(1)(B).’’. 

SEC. 5204. PUBLIC HEALTH WORKFORCE RECRUITMENT AND RETENTION PROGRAMS. 

Part E of title VII of the Public Health Service Act (42 U.S.C. 

294n et seq.), as amended by section 5203, is further amended 

by adding at the end the following: 

‘‘SEC. 776. PUBLIC HEALTH WORKFORCE LOAN REPAYMENT PROGRAM. 

‘‘(a) ESTABLISHMENT.—The Secretary shall establish the Public 

Health Workforce Loan Repayment Program (referred to in this 

section as the ‘Program’) to assure an adequate supply of public 

health professionals to eliminate critical public health workforce 

shortages in Federal, State, local, and tribal public health agencies. 

‘‘(b) ELIGIBILITY.—To be eligible to participate in the Program, 

an individual shall— 

‘‘(1)(A) be accepted for enrollment, or be enrolled, as a 

student in an accredited academic educational institution in 

a State or territory in the final year of a course of study 

or program leading to a public health or health professions 

degree or certificate; and have accepted employment with a 

Federal, State, local, or tribal public health agency, or a related 

training fellowship, as recognized by the Secretary, to commence upon graduation; 

‘‘(B)(i) have graduated, during the preceding 10-year period, 

from an accredited educational institution in a State or territory 

and received a public health or health professions degree or 

certificate; and 

‘‘(ii) be employed by, or have accepted employment with, 

a Federal, State, local, or tribal public health agency or a 

related training fellowship, as recognized by the Secretary; 

‘‘(2) be a United States citizen; and 

‘‘(3)(A) submit an application to the Secretary to participate 

in the Program; 

‘‘(B) execute a written contract as required in subsection 

(c); and 

‘‘(4) not have received, for the same service, a reduction 

of loan obligations under section 455(m), 428J, 428K, 428L, 

or 460 of the Higher Education Act of 1965. 

‘‘(c) CONTRACT.—The written contract (referred to in this section 

as the ‘written contract’) between the Secretary and an individual 

shall contain— 

‘‘(1) an agreement on the part of the Secretary that the 

Secretary will repay on behalf of the individual loans incurred 

by the individual in the pursuit of the relevant degree or 

certificate in accordance with the terms of the contract; 

‘‘(2) an agreement on the part of the individual that the 

individual will serve in the full-time employment of a Federal, 
H. R. 3590—492 

State, local, or tribal public health agency or a related fellowship program in a position related to the course of study or 

program for which the contract was awarded for a period of 

time (referred to in this section as the ‘period of obligated 

service’) equal to the greater of— 

‘‘(A) 3 years; or 

‘‘(B) such longer period of time as determined appropriate by the Secretary and the individual; 

‘‘(3) an agreement, as appropriate, on the part of the individual to relocate to a priority service area (as determined 

by the Secretary) in exchange for an additional loan repayment 

incentive amount to be determined by the Secretary; 

‘‘(4) a provision that any financial obligation of the United 

States arising out of a contract entered into under this section 

and any obligation of the individual that is conditioned thereon, 

is contingent on funds being appropriated for loan repayments 

under this section; 

‘‘(5) a statement of the damages to which the United States 

is entitled, under this section for the individual’s breach of 

the contract; and 

‘‘(6) such other statements of the rights and liabilities 

of the Secretary and of the individual, not inconsistent with 

this section. 

‘‘(d) PAYMENTS.— 

‘‘(1) IN GENERAL.—A loan repayment provided for an individual under a written contract under the Program shall consist 

of payment, in accordance with paragraph (2), on behalf of 

the individual of the principal, interest, and related expenses 

on government and commercial loans received by the individual 

regarding the undergraduate or graduate education of the individual (or both), which loans were made for tuition expenses 

incurred by the individual. 

‘‘(2) PAYMENTS FOR YEARS SERVED.—For each year of obligated service that an individual contracts to serve under subsection (c) the Secretary may pay up to $35,000 on behalf 

of the individual for loans described in paragraph (1). With 

respect to participants under the Program whose total eligible 

loans are less than $105,000, the Secretary shall pay an amount 

that does not exceed 1⁄3 of the eligible loan balance for each 

year of obligated service of the individual. 

‘‘(3) TAX LIABILITY.—For the purpose of providing 

reimbursements for tax liability resulting from payments under 

paragraph (2) on behalf of an individual, the Secretary shall, 

in addition to such payments, make payments to the individual 

in an amount not to exceed 39 percent of the total amount 

of loan repayments made for the taxable year involved. 

‘‘(e) POSTPONING OBLIGATED SERVICE.—With respect to an individual receiving a degree or certificate from a health professions 

or other related school, the date of the initiation of the period 

of obligated service may be postponed as approved by the Secretary. 

‘‘(f) BREACH OF CONTRACT.—An individual who fails to comply 

with the contract entered into under subsection (c) shall be subject 

to the same financial penalties as provided for under section 338E 

for breaches of loan repayment contracts under section 338B. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section $195,000,000 for fiscal 
H. R. 3590—493 

year 2010, and such sums as may be necessary for each of fiscal 

years 2011 through 2015.’’. 

SEC. 5205. ALLIED HEALTH WORKFORCE RECRUITMENT AND RETENTION PROGRAMS. 

(a) PURPOSE.—The purpose of this section is to assure an adequate supply of allied health professionals to eliminate critical 

allied health workforce shortages in Federal, State, local, and tribal 

public health agencies or in settings where patients might require 

health care services, including acute care facilities, ambulatory 

care facilities, personal residences and other settings, as recognized 

by the Secretary of Health and Human Services by authorizing 

an Allied Health Loan Forgiveness Program. 

(b) ALLIED HEALTH WORKFORCE RECRUITMENT AND RETENTION

PROGRAM.—Section 428K of the Higher Education Act of 1965 (20 

U.S.C. 1078–11) is amended— 

(1) in subsection (b), by adding at the end the following: 

‘‘(18) ALLIED HEALTH PROFESSIONALS.—The individual is 

employed full-time as an allied health professional— 

‘‘(A) in a Federal, State, local, or tribal public health 

agency; or 

‘‘(B) in a setting where patients might require health 

care services, including acute care facilities, ambulatory 

care facilities, personal residences and other settings 

located in health professional shortage areas, medically 

underserved areas, or medically underserved populations, 

as recognized by the Secretary of Health and Human Services.’’; and 

(2) in subsection (g)— 

(A) by redesignating paragraphs (1) through (9) as 

paragraphs (2) through (10), respectively; and 

(B) by inserting before paragraph (2) (as redesignated 

by subparagraph (A)) the following: 

‘‘(1) ALLIED HEALTH PROFESSIONAL.—The term ‘allied health 

professional’ means an allied health professional as defined 

in section 799B(5) of the Public Heath Service Act (42 U.S.C. 

295p(5)) who— 

‘‘(A) has graduated and received an allied health professions degree or certificate from an institution of higher 

education; and 

‘‘(B) is employed with a Federal, State, local or tribal 

public health agency, or in a setting where patients might 

require health care services, including acute care facilities, 

ambulatory care facilities, personal residences and other 

settings located in health professional shortage areas, medically underserved areas, or medically underserved populations, as recognized by the Secretary of Health and 

Human Services.’’. 

SEC. 5206. GRANTS FOR STATE AND LOCAL PROGRAMS. 

(a) IN GENERAL.—Section 765(d) of the Public Health Service 

Act (42 U.S.C. 295(d)) is amended— 

(1) in paragraph (7), by striking ‘‘; or’’ and inserting a 

semicolon; 

(2) by redesignating paragraph (8) as paragraph (9); and 

(3) by inserting after paragraph (7) the following: 

‘‘(8) public health workforce loan repayment programs; or’’. 
H. R. 3590—494 

(b) TRAINING FOR MID-CAREER PUBLIC HEALTH PROFES- SIONALS.—Part E of title VII of the Public Health Service Act 

(42 U.S.C. 294n et seq.), as amended by section 5204, is further 

amended by adding at the end the following: 

‘‘SEC. 777. TRAINING FOR MID-CAREER PUBLIC AND ALLIED HEALTH 

PROFESSIONALS. 

‘‘(a) IN GENERAL.—The Secretary may make grants to, or enter 

into contracts with, any eligible entity to award scholarships to 

eligible individuals to enroll in degree or professional training programs for the purpose of enabling mid-career professionals in the 

public health and allied health workforce to receive additional 

training in the field of public health and allied health. 

‘‘(b) ELIGIBILITY.— ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ indicates 

an accredited educational institution that offers a course of 

study, certificate program, or professional training program 

in public or allied health or a related discipline, as determined 

by the Secretary 

‘‘(2) ELIGIBLE INDIVIDUALS.—The term ‘eligible individuals’ 

includes those individuals employed in public and allied health 

positions at the Federal, State, tribal, or local level who are 

interested in retaining or upgrading their education. 

‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section, $60,000,000 for fiscal 

year 2010 and such sums as may be necessary for each of fiscal 

years 2011 through 2015. Fifty percent of appropriated funds shall 

be allotted to public health mid-career professionals and 50 percent 

shall be allotted to allied health mid-career professionals.’’. 

SEC. 5207. FUNDING FOR NATIONAL HEALTH SERVICE CORPS. 

Section 338H(a) of the Public Health Service Act (42 U.S.C. 

254q(a)) is amended to read as follows: 

‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there is authorized to be appropriated, 

out of any funds in the Treasury not otherwise appropriated, the 

following: ‘‘(1) For fiscal year 2010, $320,461,632. 

‘‘(2) For fiscal year 2011, $414,095,394. 

‘‘(3) For fiscal year 2012, $535,087,442. 

‘‘(4) For fiscal year 2013, $691,431,432. 

‘‘(5) For fiscal year 2014, $893,456,433. 

‘‘(6) For fiscal year 2015, $1,154,510,336. 

‘‘(7) For fiscal year 2016, and each subsequent fiscal year, 

the amount appropriated for the preceding fiscal year adjusted 

by the product of— 

‘‘(A) one plus the average percentage increase in the 

costs of health professions education during the prior fiscal 

year; and 

‘‘(B) one plus the average percentage change in the 

number of individuals residing in health professions shortage areas designated under section 333 during the prior 

fiscal year, relative to the number of individuals residing 

in such areas during the previous fiscal year.’’. 

SEC. 5208. NURSE-MANAGED HEALTH CLINICS. 

(a) PURPOSE.—The purpose of this section is to fund the development and operation of nurse-managed health clinics. 
H. R. 3590—495 

(b) GRANTS.—Subpart 1 of part D of title III of the Public 

Health Service Act (42 U.S.C. 254b et seq.) is amended by inserting 

after section 330A the following: 

‘‘SEC. 330A–1. GRANTS TO NURSE–MANAGED HEALTH CLINICS. 

‘‘(a) DEFINITIONS.— 

‘‘(1) COMPREHENSIVE PRIMARY HEALTH CARE SERVICES.— 

In this section, the term ‘comprehensive primary health care 

services’ means the primary health services described in section 

330(b)(1). 

‘‘(2) NURSE-MANAGED HEALTH CLINIC.—The term ‘nursemanaged health clinic’ means a nurse-practice arrangement, 

managed by advanced practice nurses, that provides primary 

care or wellness services to underserved or vulnerable populations and that is associated with a school, college, university 

or department of nursing, federally qualified health center, 

or independent nonprofit health or social services agency. 

‘‘(b) AUTHORITY TO AWARD GRANTS.—The Secretary shall award 

grants for the cost of the operation of nurse-managed health clinics 

that meet the requirements of this section. 

‘‘(c) APPLICATIONS.—To be eligible to receive a grant under 

this section, an entity shall— 

‘‘(1) be an NMHC; and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing— 

‘‘(A) assurances that nurses are the major providers 

of services at the NMHC and that at least 1 advanced 

practice nurse holds an executive management position 

within the organizational structure of the NMHC; 

‘‘(B) an assurance that the NMHC will continue providing comprehensive primary health care services or 

wellness services without regard to income or insurance 

status of the patient for the duration of the grant period; 

and 

‘‘(C) an assurance that, not later than 90 days of 

receiving a grant under this section, the NMHC will establish a community advisory committee, for which a majority 

of the members shall be individuals who are served by 

the NMHC. 

‘‘(d) GRANT AMOUNT.—The amount of any grant made under 

this section for any fiscal year shall be determined by the Secretary, 

taking into account— 

‘‘(1) the financial need of the NMHC, considering State, 

local, and other operational funding provided to the NMHC; 

and 

‘‘(2) other factors, as the Secretary determines appropriate. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the purposes of 

carrying out this section, there are authorized to be appropriated 

$50,000,000 for the fiscal year 2010 and such sums as may be 

necessary for each of the fiscal years 2011 through 2014.’’. 

SEC. 5209. ELIMINATION OF CAP ON COMMISSIONED CORPS. 

Section 202 of the Department of Health and Human Services 

Appropriations Act, 1993 (Public Law 102–394) is amended by 

striking ‘‘not to exceed 2,800’’. 
H. R. 3590—496 

SEC. 5210. ESTABLISHING A READY RESERVE CORPS. 

Section 203 of the Public Health Service Act (42 U.S.C. 204) 

is amended to read as follows: 

‘‘SEC. 203. COMMISSIONED CORPS AND READY RESERVE CORPS. 

‘‘(a) ESTABLISHMENT.— 

‘‘(1) IN GENERAL.—There shall be in the Service a commissioned Regular Corps and a Ready Reserve Corps for service 

in time of national emergency. 

‘‘(2) REQUIREMENT.—All commissioned officers shall be citizens of the United States and shall be appointed without regard 

to the civil-service laws and compensated without regard to 

the Classification Act of 1923, as amended. 

‘‘(3) APPOINTMENT.—Commissioned officers of the Ready 

Reserve Corps shall be appointed by the President and commissioned officers of the Regular Corps shall be appointed by 

the President with the advice and consent of the Senate. 

‘‘(4) ACTIVE DUTY.—Commissioned officers of the Ready 

Reserve Corps shall at all times be subject to call to active 

duty by the Surgeon General, including active duty for the 

purpose of training. 

‘‘(5) WARRANT OFFICERS.—Warrant officers may be 

appointed to the Service for the purpose of providing support 

to the health and delivery systems maintained by the Service 

and any warrant officer appointed to the Service shall be considered for purposes of this Act and title 37, United States Code, 

to be a commissioned officer within the Commissioned Corps 

of the Service. 

‘‘(b) ASSIMILATING RESERVE CORP OFFICERS INTO THE REGULAR

CORPS.—Effective on the date of enactment of the Patient Protection 

and Affordable Care Act, all individuals classified as officers in 

the Reserve Corps under this section (as such section existed on 

the day before the date of enactment of such Act) and serving 

on active duty shall be deemed to be commissioned officers of 

the Regular Corps. 

‘‘(c) PURPOSE AND USE OF READY RESEARCH.— 

‘‘(1) PURPOSE.—The purpose of the Ready Reserve Corps 

is to fulfill the need to have additional Commissioned Corps 

personnel available on short notice (similar to the uniformed 

service’s reserve program) to assist regular Commissioned 

Corps personnel to meet both routine public health and emergency response missions. 

‘‘(2) USES.—The Ready Reserve Corps shall— 

‘‘(A) participate in routine training to meet the general 

and specific needs of the Commissioned Corps; 

‘‘(B) be available and ready for involuntary calls to 

active duty during national emergencies and public health 

crises, similar to the uniformed service reserve personnel; 

‘‘(C) be available for backfilling critical positions left 

vacant during deployment of active duty Commissioned 

Corps members, as well as for deployment to respond to 

public health emergencies, both foreign and domestic; and 

‘‘(D) be available for service assignment in isolated, 

hardship, and medically underserved communities (as 

defined in section 799B) to improve access to health services. 
H. R. 3590—497 

‘‘(d) FUNDING.—For the purpose of carrying out the duties and 

responsibilities of the Commissioned Corps under this section, there 

are authorized to be appropriated $5,000,000 for each of fiscal 

years 2010 through 2014 for recruitment and training and 

$12,500,000 for each of fiscal years 2010 through 2014 for the 

Ready Reserve Corps.’’. 

Subtitle D—Enhancing Health Care 

Workforce Education and Training 

SEC. 5301. TRAINING IN FAMILY MEDICINE, GENERAL INTERNAL MEDICINE, GENERAL PEDIATRICS, AND PHYSICIAN 

ASSISTANTSHIP. 

Part C of title VII (42 U.S.C. 293k et seq.) is amended by 

striking section 747 and inserting the following: 

‘‘SEC. 747. PRIMARY CARE TRAINING AND ENHANCEMENT. 

‘‘(a) SUPPORT AND DEVELOPMENT OF PRIMARY CARE TRAINING

PROGRAMS.— 

‘‘(1) IN GENERAL.—The Secretary may make grants to, or 

enter into contracts with, an accredited public or nonprofit 

private hospital, school of medicine or osteopathic medicine, 

academically affiliated physician assistant training program, 

or a public or private nonprofit entity which the Secretary 

has determined is capable of carrying out such grant or contract— 

‘‘(A) to plan, develop, operate, or participate in an 

accredited professional training program, including an 

accredited residency or internship program in the field 

of family medicine, general internal medicine, or general 

pediatrics for medical students, interns, residents, or practicing physicians as defined by the Secretary; 

‘‘(B) to provide need-based financial assistance in the 

form of traineeships and fellowships to medical students, 

interns, residents, practicing physicians, or other medical 

personnel, who are participants in any such program, and 

who plan to specialize or work in the practice of the fields 

defined in subparagraph (A); 

‘‘(C) to plan, develop, and operate a program for the 

training of physicians who plan to teach in family medicine, 

general internal medicine, or general pediatrics training 

programs; 

‘‘(D) to plan, develop, and operate a program for the 

training of physicians teaching in community-based settings; 

‘‘(E) to provide financial assistance in the form of 

traineeships and fellowships to physicians who are participants in any such programs and who plan to teach or 

conduct research in a family medicine, general internal 

medicine, or general pediatrics training program; 

‘‘(F) to plan, develop, and operate a physician assistant 

education program, and for the training of individuals who 

will teach in programs to provide such training; 

‘‘(G) to plan, develop, and operate a demonstration 

program that provides training in new competencies, as 

recommended by the Advisory Committee on Training in 
H. R. 3590—498 

Primary Care Medicine and Dentistry and the National 

Health Care Workforce Commission established in section 

5101 of the Patient Protection and Affordable Care Act, 

which may include— 

‘‘(i) providing training to primary care physicians 

relevant to providing care through patient-centered 

medical homes (as defined by the Secretary for purposes of this section); 

‘‘(ii) developing tools and curricula relevant to 

patient-centered medical homes; and 

‘‘(iii) providing continuing education to primary 

care physicians relevant to patient-centered medical 

homes; and 

‘‘(H) to plan, develop, and operate joint degree programs to provide interdisciplinary and interprofessional 

graduate training in public health and other health professions to provide training in environmental health, infectious disease control, disease prevention and health promotion, epidemiological studies and injury control. 

‘‘(2) DURATION OF AWARDS.—The period during which payments are made to an entity from an award of a grant or 

contract under this subsection shall be 5 years. 

‘‘(b) CAPACITY BUILDING IN PRIMARY CARE.— 

‘‘(1) IN GENERAL.—The Secretary may make grants to or 

enter into contracts with accredited schools of medicine or 

osteopathic medicine to establish, maintain, or improve— 

‘‘(A) academic units or programs that improve clinical 

teaching and research in fields defined in subsection 

(a)(1)(A); or 

‘‘(B) programs that integrate academic administrative 

units in fields defined in subsection (a)(1)(A) to enhance 

interdisciplinary recruitment, training, and faculty development. 

‘‘(2) PREFERENCE IN MAKING AWARDS UNDER THIS SUBSECTION.—In making awards of grants and contracts under 

paragraph (1), the Secretary shall give preference to any qualified applicant for such an award that agrees to expend the 

award for the purpose of— 

‘‘(A) establishing academic units or programs in fields 

defined in subsection (a)(1)(A); or 

‘‘(B) substantially expanding such units or programs. 

‘‘(3) PRIORITIES IN MAKING AWARDS.—In awarding grants 

or contracts under paragraph (1), the Secretary shall give priority to qualified applicants that— 

‘‘(A) proposes a collaborative project between academic 

administrative units of primary care; 

‘‘(B) proposes innovative approaches to clinical teaching 

using models of primary care, such as the patient centered 

medical home, team management of chronic disease, and 

interprofessional integrated models of health care that 

incorporate transitions in health care settings and integration physical and mental health provision; 

‘‘(C) have a record of training the greatest percentage 

of providers, or that have demonstrated significant 

improvements in the percentage of providers trained, who 

enter and remain in primary care practice; 
H. R. 3590—499 

‘‘(D) have a record of training individuals who are 

from underrepresented minority groups or from a rural 

or disadvantaged background; 

‘‘(E) provide training in the care of vulnerable populations such as children, older adults, homeless individuals, 

victims of abuse or trauma, individuals with mental health 

or substance-related disorders, individuals with HIV/AIDS, 

and individuals with disabilities; 

‘‘(F) establish formal relationships and submit joint 

applications with federally qualified health centers, rural 

health clinics, area health education centers, or clinics 

located in underserved areas or that serve underserved 

populations; 

‘‘(G) teach trainees the skills to provide interprofessional, integrated care through collaboration among health 

professionals; 

‘‘(H) provide training in enhanced communication with 

patients, evidence-based practice, chronic disease management, preventive care, health information technology, or 

other competencies as recommended by the Advisory Committee on Training in Primary Care Medicine and Dentistry 

and the National Health Care Workforce Commission 

established in section 5101 of the Patient Protection and 

Affordable Care Act; or 

‘‘(I) provide training in cultural competency and health 

literacy. 

‘‘(4) DURATION OF AWARDS.—The period during which payments are made to an entity from an award of a grant or 

contract under this subsection shall be 5 years. 

‘‘(c) AUTHORIZATION OF APPROPRIATIONS.— 

‘‘(1) IN GENERAL.—For purposes of carrying out this section 

(other than subsection (b)(1)(B)), there are authorized to be 

appropriated $125,000,000 for fiscal year 2010, and such sums 

as may be necessary for each of fiscal years 2011 through 

2014. 

‘‘(2) TRAINING PROGRAMS.—Fifteen percent of the amount 

appropriated pursuant to paragraph (1) in each such fiscal 

year shall be allocated to the physician assistant training programs described in subsection (a)(1)(F), which prepare students 

for practice in primary care. 

‘‘(3) INTEGRATING ACADEMIC ADMINISTRATIVE UNITS.—For 

purposes of carrying out subsection (b)(1)(B), there are authorized to be appropriated $750,000 for each of fiscal years 2010 

through 2014.’’. 

SEC. 5302. TRAINING OPPORTUNITIES FOR DIRECT CARE WORKERS. 

Part C of title VII of the Public Health Service Act (42 U.S.C. 

293k et seq.) is amended by inserting after section 747, as amended 

by section 5301, the following: 

‘‘SEC. 747A. TRAINING OPPORTUNITIES FOR DIRECT CARE WORKERS. 

‘‘(a) IN GENERAL.—The Secretary shall award grants to eligible 

entities to enable such entities to provide new training opportunities 

for direct care workers who are employed in long-term care settings 

such as nursing homes (as defined in section 1908(e)(1) of the 

Social Security Act (42 U.S.C. 1396g(e)(1)), assisted living facilities 
H. R. 3590—500 

and skilled nursing facilities, intermediate care facilities for individuals with mental retardation, home and community based settings, 

and any other setting the Secretary determines to be appropriate. 

‘‘(b) ELIGIBILITY.—To be eligible to receive a grant under this 

section, an entity shall— 

‘‘(1) be an institution of higher education (as defined in 

section 102 of the Higher Education Act of 1965 (20 U.S.C. 

1002)) that— 

‘‘(A) is accredited by a nationally recognized accrediting 

agency or association listed under section 101(c) of the 

Higher Education Act of 1965 (20 U.S.C. 1001(c)); and 

‘‘(B) has established a public-private educational partnership with a nursing home or skilled nursing facility, 

agency or entity providing home and community based 

services to individuals with disabilities, or other long-term 

care provider; and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require. 

‘‘(c) USE OF FUNDS.—An eligible entity shall use amounts 

awarded under a grant under this section to provide assistance 

to eligible individuals to offset the cost of tuition and required 

fees for enrollment in academic programs provided by such entity. 

‘‘(d) ELIGIBLE INDIVIDUAL.— ‘‘(1) ELIGIBILITY.—To be eligible for assistance under this 

section, an individual shall be enrolled in courses provided 

by a grantee under this subsection and maintain satisfactory 

academic progress in such courses. 

‘‘(2) CONDITION OF ASSISTANCE.—As a condition of receiving 

assistance under this section, an individual shall agree that, 

following completion of the assistance period, the individual 

will work in the field of geriatrics, disability services, long 

term services and supports, or chronic care management for 

a minimum of 2 years under guidelines set by the Secretary. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section, $10,000,000 for the 

period of fiscal years 2011 through 2013.’’. 

SEC. 5303. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC HEALTH 

DENTISTRY. 

Part C of Title VII of the Public Health Service Act (42 U.S.C. 

293k et seq.) is amended by— 

(1) redesignating section 748, as amended by section 5103 

of this Act, as section 749; and 

(2) inserting after section 747A, as added by section 5302, 

the following: 

‘‘SEC. 748. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC HEALTH 

DENTISTRY. 

‘‘(a) SUPPORT AND DEVELOPMENT OF DENTAL TRAINING PROGRAMS.— 

‘‘(1) IN GENERAL.—The Secretary may make grants to, or 

enter into contracts with, a school of dentistry, public or nonprofit private hospital, or a public or private nonprofit entity 

which the Secretary has determined is capable of carrying 

out such grant or contract— 

‘‘(A) to plan, develop, and operate, or participate in, 

an approved professional training program in the field 
H. R. 3590—501 

of general dentistry, pediatric dentistry, or public health 

dentistry for dental students, residents, practicing dentists, 

dental hygienists, or other approved primary care dental 

trainees, that emphasizes training for general, pediatric, 

or public health dentistry; 

‘‘(B) to provide financial assistance to dental students, 

residents, practicing dentists, and dental hygiene students 

who are in need thereof, who are participants in any such 

program, and who plan to work in the practice of general, 

pediatric, public heath dentistry, or dental hygiene; 

‘‘(C) to plan, develop, and operate a program for the 

training of oral health care providers who plan to teach 

in general, pediatric, public health dentistry, or dental 

hygiene; 

‘‘(D) to provide financial assistance in the form of 

traineeships and fellowships to dentists who plan to teach 

or are teaching in general, pediatric, or public health dentistry; 

‘‘(E) to meet the costs of projects to establish, maintain, 

or improve dental faculty development programs in primary 

care (which may be departments, divisions or other units); 

‘‘(F) to meet the costs of projects to establish, maintain, 

or improve predoctoral and postdoctoral training in primary 

care programs; 

‘‘(G) to create a loan repayment program for faculty 

in dental programs; and 

‘‘(H) to provide technical assistance to pediatric 

training programs in developing and implementing instruction regarding the oral health status, dental care needs, 

and risk-based clinical disease management of all pediatric 

populations with an emphasis on underserved children. 

‘‘(2) FACULTY LOAN REPAYMENT.— 

‘‘(A) IN GENERAL.—A grant or contract under subsection 

(a)(1)(G) may be awarded to a program of general, pediatric, 

or public health dentistry described in such subsection 

to plan, develop, and operate a loan repayment program 

under which— 

‘‘(i) individuals agree to serve full-time as faculty 

members; and 

‘‘(ii) the program of general, pediatric or public 

health dentistry agrees to pay the principal and 

interest on the outstanding student loans of the 

individuals. 

‘‘(B) MANNER OF PAYMENTS.—With respect to the payments described in subparagraph (A)(ii), upon completion 

by an individual of each of the first, second, third, fourth, 

and fifth years of service, the program shall pay an amount 

equal to 10, 15, 20, 25, and 30 percent, respectively, of 

the individual’s student loan balance as calculated based 

on principal and interest owed at the initiation of the 

agreement. 

‘‘(b) ELIGIBLE ENTITY.—For purposes of this subsection, entities 

eligible for such grants or contracts in general, pediatric, or public 

health dentistry shall include entities that have programs in dental 

or dental hygiene schools, or approved residency or advanced education programs in the practice of general, pediatric, or public 

health dentistry. Eligible entities may partner with schools of public 
H. R. 3590—502 

health to permit the education of dental students, residents, and 

dental hygiene students for a master’s year in public health at 

a school of public health. 

‘‘(c) PRIORITIES IN MAKING AWARDS.—With respect to training 

provided for under this section, the Secretary shall give priority 

in awarding grants or contracts to the following: 

‘‘(1) Qualified applicants that propose collaborative projects 

between departments of primary care medicine and departments of general, pediatric, or public health dentistry. 

‘‘(2) Qualified applicants that have a record of training 

the greatest percentage of providers, or that have demonstrated 

significant improvements in the percentage of providers, who 

enter and remain in general, pediatric, or public health dentistry. 

‘‘(3) Qualified applicants that have a record of training 

individuals who are from a rural or disadvantaged background, 

or from underrepresented minorities. 

‘‘(4) Qualified applicants that establish formal relationships 

with Federally qualified health centers, rural health centers, 

or accredited teaching facilities and that conduct training of 

students, residents, fellows, or faculty at the center or facility. 

‘‘(5) Qualified applicants that conduct teaching programs 

targeting vulnerable populations such as older adults, homeless 

individuals, victims of abuse or trauma, individuals with mental 

health or substance-related disorders, individuals with disabilities, and individuals with HIV/AIDS, and in the risk-based 

clinical disease management of all populations. 

‘‘(6) Qualified applicants that include educational activities 

in cultural competency and health literacy. 

‘‘(7) Qualified applicants that have a high rate for placing 

graduates in practice settings that serve underserved areas 

or health disparity populations, or who achieve a significant 

increase in the rate of placing graduates in such settings. 

‘‘(8) Qualified applicants that intend to establish a special 

populations oral health care education center or training program for the didactic and clinical education of dentists, dental 

health professionals, and dental hygienists who plan to teach 

oral health care for people with developmental disabilities, 

cognitive impairment, complex medical problems, significant 

physical limitations, and vulnerable elderly. 

‘‘(d) APPLICATION.—An eligible entity desiring a grant under 

this section shall submit to the Secretary an application at such 

time, in such manner, and containing such information as the 

Secretary may require. 

‘‘(e) DURATION OF AWARD.—The period during which payments 

are made to an entity from an award of a grant or contract under 

subsection (a) shall be 5 years. The provision of such payments 

shall be subject to annual approval by the Secretary and subject 

to the availability of appropriations for the fiscal year involved 

to make the payments. 

‘‘(f) AUTHORIZATIONS OF APPROPRIATIONS.—For the purpose of 

carrying out subsections (a) and (b), there is authorized to be 

appropriated $30,000,000 for fiscal year 2010 and such sums as 

may be necessary for each of fiscal years 2011 through 2015. 

‘‘(g) CARRYOVER FUNDS.—An entity that receives an award 

under this section may carry over funds from 1 fiscal year to 

another without obtaining approval from the Secretary. In no case 
H. R. 3590—503 

may any funds be carried over pursuant to the preceding sentence 

for more than 3 years.’’. 

SEC. 5304. ALTERNATIVE DENTAL HEALTH CARE PROVIDERS DEMONSTRATION PROJECT. 

Subpart X of part D of title III of the Public Health Service 

Act (42 U.S.C. 256f et seq.) is amended by adding at the end 

the following: 

‘‘SEC. 340G–1. DEMONSTRATION PROGRAM. 

‘‘(a) IN GENERAL.— ‘‘(1) AUTHORIZATION.—The Secretary is authorized to award 

grants to 15 eligible entities to enable such entities to establish 

a demonstration program to establish training programs to 

train, or to employ, alternative dental health care providers 

in order to increase access to dental health care services in 

rural and other underserved communities. 

‘‘(2) DEFINITION.—The term ‘alternative dental health care 

providers’ includes community dental health coordinators, 

advance practice dental hygienists, independent dental hygienists, supervised dental hygienists, primary care physicians, 

dental therapists, dental health aides, and any other health 

professional that the Secretary determines appropriate. 

‘‘(b) TIMEFRAME.—The demonstration projects funded under this 

section shall begin not later than 2 years after the date of enactment 

of this section, and shall conclude not later than 7 years after 

such date of enactment. 

‘‘(c) ELIGIBLE ENTITIES.—To be eligible to receive a grant under 

subsection (a), an entity shall— 

‘‘(1) be— 

‘‘(A) an institution of higher education, including a 

community college; 

‘‘(B) a public-private partnership; 

‘‘(C) a federally qualified health center; 

‘‘(D) an Indian Health Service facility or a tribe or 

tribal organization (as such terms are defined in section 

4 of the Indian Self-Determination and Education Assistance Act); 

‘‘(E) a State or county public health clinic, a health 

facility operated by an Indian tribe or tribal organization, 

or urban Indian organization providing dental services; 

or 

‘‘(F) a public hospital or health system; 

‘‘(2) be within a program accredited by the Commission 

on Dental Accreditation or within a dental education program 

in an accredited institution; and 

‘‘(3) shall submit an application to the Secretary at such 

time, in such manner, and containing such information as 

the Secretary may require. 

‘‘(d) ADMINISTRATIVE PROVISIONS.— ‘‘(1) AMOUNT OF GRANT.—Each grant under this section 

shall be in an amount that is not less than $4,000,000 for 

the 5-year period during which the demonstration project being 

conducted. 

‘‘(2) DISBURSEMENT OF FUNDS.— ‘‘(A) PRELIMINARY DISBURSEMENTS.—Beginning 1 year 

after the enactment of this section, the Secretary may 

disperse to any entity receiving a grant under this section 
H. R. 3590—504 

not more than 20 percent of the total funding awarded 

to such entity under such grant, for the purpose of enabling 

the entity to plan the demonstration project to be conducted 

under such grant. 

‘‘(B) SUBSEQUENT DISBURSEMENTS.—The remaining 

amount of grant funds not dispersed under subparagraph 

(A) shall be dispersed such that not less than 15 percent 

of such remaining amount is dispersed each subsequent 

year. 

‘‘(e) COMPLIANCE WITH STATE REQUIREMENTS.—Each entity 

receiving a grant under this section shall certify that it is in 

compliance with all applicable State licensing requirements. 

‘‘(f) EVALUATION.—The Secretary shall contract with the 

Director of the Institute of Medicine to conduct a study of the 

demonstration programs conducted under this section that shall 

provide analysis, based upon quantitative and qualitative data, 

regarding access to dental health care in the United States. 

‘‘(g) CLARIFICATION REGARDING DENTAL HEALTH AIDE PROGRAM.—Nothing in this section shall prohibit a dental health aide 

training program approved by the Indian Health Service from being 

eligible for a grant under this section. 

‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated such sums as may be necessary to carry out 

this section.’’. 

SEC. 5305. GERIATRIC EDUCATION AND TRAINING; CAREER AWARDS; 

COMPREHENSIVE GERIATRIC EDUCATION. 

(a) WORKFORCE DEVELOPMENT; CAREER AWARDS.—Section 753 

of the Public Health Service Act (42 U.S.C. 294c) is amended 

by adding at the end the following: 

‘‘(d) GERIATRIC WORKFORCE DEVELOPMENT.— 

‘‘(1) IN GENERAL.—The Secretary shall award grants or 

contracts under this subsection to entities that operate a geriatric education center pursuant to subsection (a)(1). 

‘‘(2) APPLICATION.—To be eligible for an award under paragraph (1), an entity described in such paragraph shall submit 

to the Secretary an application at such time, in such manner, 

and containing such information as the Secretary may require. 

‘‘(3) USE OF FUNDS.—Amounts awarded under a grant or 

contract under paragraph (1) shall be used to— 

‘‘(A) carry out the fellowship program described in 

paragraph (4); and 

‘‘(B) carry out 1 of the 2 activities described in paragraph (5). 

‘‘(4) FELLOWSHIP PROGRAM.— 

‘‘(A) IN GENERAL.—Pursuant to paragraph (3), a geriatric education center that receives an award under this 

subsection shall use such funds to offer short-term intensive 

courses (referred to in this subsection as a ‘fellowship’) 

that focus on geriatrics, chronic care management, and 

long-term care that provide supplemental training for faculty members in medical schools and other health professions schools with programs in psychology, pharmacy, 

nursing, social work, dentistry, public health, allied health, 

or other health disciplines, as approved by the Secretary. 

Such a fellowship shall be open to current faculty, and 
H. R. 3590—505 

appropriately credentialed volunteer faculty and practitioners, who do not have formal training in geriatrics, 

to upgrade their knowledge and clinical skills for the care 

of older adults and adults with functional limitations and 

to enhance their interdisciplinary teaching skills. 

‘‘(B) LOCATION.—A fellowship shall be offered either 

at the geriatric education center that is sponsoring the 

course, in collaboration with other geriatric education centers, or at medical schools, schools of dentistry, schools 

of nursing, schools of pharmacy, schools of social work, 

graduate programs in psychology, or allied health and other 

health professions schools approved by the Secretary with 

which the geriatric education centers are affiliated. 

‘‘(C) CME CREDIT.—Participation in a fellowship under 

this paragraph shall be accepted with respect to complying 

with continuing health profession education requirements. 

As a condition of such acceptance, the recipient shall agree 

to subsequently provide a minimum of 18 hours of voluntary instructional support through a geriatric education 

center that is providing clinical training to students or 

trainees in long-term care settings. 

‘‘(5) ADDITIONAL REQUIRED ACTIVITIES DESCRIBED.—Pursuant to paragraph (3), a geriatric education center that receives 

an award under this subsection shall use such funds to carry 

out 1 of the following 2 activities. 

‘‘(A) FAMILY CAREGIVER AND DIRECT CARE PROVIDER

TRAINING.—A geriatric education center that receives an 

award under this subsection shall offer at least 2 courses 

each year, at no charge or nominal cost, to family caregivers 

and direct care providers that are designed to provide 

practical training for supporting frail elders and individuals 

with disabilities. The Secretary shall require such Centers 

to work with appropriate community partners to develop 

training program content and to publicize the availability 

of training courses in their service areas. All family caregiver and direct care provider training programs shall 

include instruction on the management of psychological 

and behavioral aspects of dementia, communication techniques for working with individuals who have dementia, 

and the appropriate, safe, and effective use of medications 

for older adults. 

‘‘(B) INCORPORATION OF BEST PRACTICES.—A geriatric 

education center that receives an award under this subsection shall develop and include material on depression 

and other mental disorders common among older adults, 

medication safety issues for older adults, and management 

of the psychological and behavioral aspects of dementia 

and communication techniques with individuals who have 

dementia in all training courses, where appropriate. 

‘‘(6) TARGETS.—A geriatric education center that receives 

an award under this subsection shall meet targets approved 

by the Secretary for providing geriatric training to a certain 

number of faculty or practitioners during the term of the award, 

as well as other parameters established by the Secretary. 

‘‘(7) AMOUNT OF AWARD.—An award under this subsection 

shall be in an amount of $150,000. Not more than 24 geriatric 

education centers may receive an award under this subsection. 
H. R. 3590—506 

‘‘(8) MAINTENANCE OF EFFORT.—A geriatric education center 

that receives an award under this subsection shall provide 

assurances to the Secretary that funds provided to the geriatric 

education center under this subsection will be used only to 

supplement, not to supplant, the amount of Federal, State, 

and local funds otherwise expended by the geriatric education 

center. 

‘‘(9) AUTHORIZATION OF APPROPRIATIONS.—In addition to 

any other funding available to carry out this section, there 

is authorized to be appropriated to carry out this subsection, 

$10,800,000 for the period of fiscal year 2011 through 2014. 

‘‘(e) GERIATRIC CAREER INCENTIVE AWARDS.— 

‘‘(1) IN GENERAL.—The Secretary shall award grants or 

contracts under this section to individuals described in paragraph (2) to foster greater interest among a variety of health 

professionals in entering the field of geriatrics, long-term care, 

and chronic care management. 

‘‘(2) ELIGIBLE INDIVIDUALS.—To be eligible to received an 

award under paragraph (1), an individual shall— 

‘‘(A) be an advanced practice nurse, a clinical social 

worker, a pharmacist, or student of psychology who is 

pursuing a doctorate or other advanced degree in geriatrics 

or related fields in an accredited health professions school; 

and 

‘‘(B) submit to the Secretary an application at such 

time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(3) CONDITION OF AWARD.—As a condition of receiving 

an award under this subsection, an individual shall agree that, 

following completion of the award period, the individual will 

teach or practice in the field of geriatrics, long-term care, or 

chronic care management for a minimum of 5 years under 

guidelines set by the Secretary. 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection, $10,000,000 

for the period of fiscal years 2011 through 2013.’’. 

(b) EXPANSION OF ELIGIBILITY FOR GERIATRIC ACADEMIC CAREER

AWARDS; PAYMENT TO INSTITUTION.—Section 753(c) of the Public 

Health Service Act 294(c)) is amended— 

(1) by redesignating paragraphs (4) and (5) as paragraphs 

(5) and (6), respectively; 

(2) by striking paragraph (2) through paragraph (3) and 

inserting the following: 

‘‘(2) ELIGIBLE INDIVIDUALS.—To be eligible to receive an 

Award under paragraph (1), an individual shall— 

‘‘(A) be board certified or board eligible in internal 

medicine, family practice, psychiatry, or licensed dentistry, 

or have completed any required training in a discipline 

and employed in an accredited health professions school 

that is approved by the Secretary; 

‘‘(B) have completed an approved fellowship program 

in geriatrics or have completed specialty training in geriatrics as required by the discipline and any addition geriatrics training as required by the Secretary; and 

‘‘(C) have a junior (non-tenured) faculty appointment 

at an accredited (as determined by the Secretary) school 

of medicine, osteopathic medicine, nursing, social work, 
H. R. 3590—507 

psychology, dentistry, pharmacy, or other allied health disciplines in an accredited health professions school that 

is approved by the Secretary. 

‘‘(3) LIMITATIONS.—No Award under paragraph (1) may 

be made to an eligible individual unless the individual— 

‘‘(A) has submitted to the Secretary an application, 

at such time, in such manner, and containing such information as the Secretary may require, and the Secretary has 

approved such application; 

‘‘(B) provides, in such form and manner as the Secretary may require, assurances that the individual will 

meet the service requirement described in paragraph (6); 

and 

‘‘(C) provides, in such form and manner as the Secretary may require, assurances that the individual has 

a full-time faculty appointment in a health professions 

institution and documented commitment from such institution to spend 75 percent of the total time of such individual 

on teaching and developing skills in interdisciplinary education in geriatrics. 

‘‘(4) MAINTENANCE OF EFFORT.—An eligible individual that 

receives an Award under paragraph (1) shall provide assurances 

to the Secretary that funds provided to the eligible individual 

under this subsection will be used only to supplement, not 

to supplant, the amount of Federal, State, and local funds 

otherwise expended by the eligible individual.’’; and 

(3) in paragraph (5), as so designated— 

(A) in subparagraph (A)— 

(i) by inserting ‘‘for individuals who are physicians’’ 

after ‘‘this section’’; and 

(ii) by inserting after the period at the end the 

following: ‘‘The Secretary shall determine the amount 

of an Award under this section for individuals who 

are not physicians.’’; and 

(B) by adding at the end the following: 

‘‘(C) PAYMENT TO INSTITUTION.—The Secretary shall 

make payments to institutions which include schools of 

medicine, osteopathic medicine, nursing, social work, psychology, dentistry, and pharmacy, or other allied health 

discipline in an accredited health professions school that 

is approved by the Secretary.’’. 

(c) COMPREHENSIVE GERIATRIC EDUCATION.—Section 855 of the 

Public Health Service Act (42 U.S.C. 298) is amended— 

(1) in subsection (b)— 

(A) in paragraph (3), by striking ‘‘or’’ at the end; 

(B) in paragraph (4), by striking the period and 

inserting ‘‘; or’’; and 

(C) by adding at the end the following: 

‘‘(5) establish traineeships for individuals who are preparing for advanced education nursing degrees in geriatric 

nursing, long-term care, gero-psychiatric nursing or other 

nursing areas that specialize in the care of the elderly population.’’; and 

(2) in subsection (e), by striking ‘‘2003 through 2007’’ and 

inserting ‘‘2010 through 2014’’. 
H. R. 3590—508 

SEC. 5306. MENTAL AND BEHAVIORAL HEALTH EDUCATION AND 

TRAINING GRANTS. 

(a) IN GENERAL.—Part D of title VII (42 U.S.C. 294 et seq.) 

is amended by— 

(1) striking section 757; 

(2) redesignating section 756 (as amended by section 5103) 

as section 757; and 

(3) inserting after section 755 the following: 

‘‘SEC. 756. MENTAL AND BEHAVIORAL HEALTH EDUCATION AND 

TRAINING GRANTS. 

‘‘(a) GRANTS AUTHORIZED.—The Secretary may award grants 

to eligible institutions of higher education to support the recruitment of students for, and education and clinical experience of the 

students in— 

‘‘(1) baccalaureate, master’s, and doctoral degree programs 

of social work, as well as the development of faculty in social 

work; 

‘‘(2) accredited master’s, doctoral, internship, and post-doctoral residency programs of psychology for the development 

and implementation of interdisciplinary training of psychology 

graduate students for providing behavioral and mental health 

services, including substance abuse prevention and treatment 

services; 

‘‘(3) accredited institutions of higher education or accredited 

professional training programs that are establishing or 

expanding internships or other field placement programs in 

child and adolescent mental health in psychiatry, psychology, 

school psychology, behavioral pediatrics, psychiatric nursing, 

social work, school social work, substance abuse prevention 

and treatment, marriage and family therapy, school counseling, 

or professional counseling; and 

‘‘(4) State-licensed mental health nonprofit and for-profit 

organizations to enable such organizations to pay for programs 

for preservice or in-service training of paraprofessional child 

and adolescent mental health workers. 

‘‘(b) ELIGIBILITY REQUIREMENTS.—To be eligible for a grant 

under this section, an institution shall demonstrate— 

‘‘(1) participation in the institutions’ programs of individuals and groups from different racial, ethnic, cultural, 

geographic, religious, linguistic, and class backgrounds, and 

different genders and sexual orientations; 

‘‘(2) knowledge and understanding of the concerns of the 

individuals and groups described in subsection (a); 

‘‘(3) any internship or other field placement program 

assisted under the grant will prioritize cultural and linguistic 

competency; 

‘‘(4) the institution will provide to the Secretary such data, 

assurances, and information as the Secretary may require; 

and 

‘‘(5) with respect to any violation of the agreement between 

the Secretary and the institution, the institution will pay such 

liquidated damages as prescribed by the Secretary by regulation. 

‘‘(c) INSTITUTIONAL REQUIREMENT.—For grants authorized 

under subsection (a)(1), at least 4 of the grant recipients shall 
H. R. 3590—509 

be historically black colleges or universities or other minorityserving institutions. 

‘‘(d) PRIORITY.— 

‘‘(1) In selecting the grant recipients in social work under 

subsection (a)(1), the Secretary shall give priority to applicants 

that— 

‘‘(A) are accredited by the Council on Social Work 

Education; 

‘‘(B) have a graduation rate of not less than 80 percent 

for social work students; and 

‘‘(C) exhibit an ability to recruit social workers from 

and place social workers in areas with a high need and 

high demand population. 

‘‘(2) In selecting the grant recipients in graduate psychology 

under subsection (a)(2), the Secretary shall give priority to 

institutions in which training focuses on the needs of vulnerable 

groups such as older adults and children, individuals with 

mental health or substance-related disorders, victims of abuse 

or trauma and of combat stress disorders such as posttraumatic 

stress disorder and traumatic brain injuries, homeless individuals, chronically ill persons, and their families. 

‘‘(3) In selecting the grant recipients in training programs 

in child and adolescent mental health under subsections (a)(3) 

and (a)(4), the Secretary shall give priority to applicants that— 

‘‘(A) have demonstrated the ability to collect data on 

the number of students trained in child and adolescent 

mental health and the populations served by such students 

after graduation or completion of preservice or in-service 

training; 

‘‘(B) have demonstrated familiarity with evidence-based 

methods in child and adolescent mental health services, 

including substance abuse prevention and treatment services; 

‘‘(C) have programs designed to increase the number 

of professionals and paraprofessionals serving high-priority 

populations and to applicants who come from high-priority 

communities and plan to serve medically underserved populations, in health professional shortage areas, or in medically underserved areas; 

‘‘(D) offer curriculum taught collaboratively with a 

family on the consumer and family lived experience or 

the importance of family-professional or family-paraprofessional partnerships; and 

‘‘(E) provide services through a community mental 

health program described in section 1913(b)(1). 

‘‘(e) AUTHORIZATION OF APPROPRIATION.—For the fiscal years 

2010 through 2013, there is authorized to be appropriated to carry 

out this section— 

‘‘(1) $8,000,000 for training in social work in subsection 

(a)(1); 

‘‘(2) $12,000,000 for training in graduate psychology in 

subsection (a)(2), of which not less than $10,000,000 shall be 

allocated for doctoral, postdoctoral, and internship level 

training; 

‘‘(3) $10,000,000 for training in professional child and 

adolescent mental health in subsection (a)(3); and 
H. R. 3590—510 

‘‘(4) $5,000,000 for training in paraprofessional child and 

adolescent work in subsection (a)(4).’’. 

(b) CONFORMING AMENDMENTS.—Section 757(b)(2) of the Public 

Health Service Act, as redesignated by subsection (a), is amended 

by striking ‘‘sections 751(a)(1)(A), 751(a)(1)(B), 753(b), 754(3)(A), 

and 755(b)’’ and inserting ‘‘sections 751(b)(1)(A), 753(b), and 755(b)’’. 

SEC. 5307. CULTURAL COMPETENCY, PREVENTION, AND PUBLIC 

HEALTH AND INDIVIDUALS WITH DISABILITIES 

TRAINING. 

(a) TITLE VII.—Section 741 of the Public Health Service Act 

(42 U.S.C. 293e) is amended— 

(1) in subsection (a)— 

(A) by striking the subsection heading and inserting 

‘‘CULTURAL COMPETENCY, PREVENTION, AND PUBLIC

HEALTH AND INDIVIDUALS WITH DISABILITY GRANTS’’; and 

(B) in paragraph (1), by striking ‘‘for the purpose of’’ 

and all that follows through the period at the end and 

inserting ‘‘for the development, evaluation, and dissemination of research, demonstration projects, and model curricula for cultural competency, prevention, public health 

proficiency, reducing health disparities, and aptitude for 

working with individuals with disabilities training for use 

in health professions schools and continuing education programs, and for other purposes determined as appropriate 

by the Secretary.’’; and 

(2) by striking subsection (b) and inserting the following: 

‘‘(b) COLLABORATION.—In carrying out subsection (a), the Secretary shall collaborate with health professional societies, licensing 

and accreditation entities, health professions schools, and experts 

in minority health and cultural competency, prevention, and public 

health and disability groups, community-based organizations, and 

other organizations as determined appropriate by the Secretary. 

The Secretary shall coordinate with curricula and research and 

demonstration projects developed under section 807. 

‘‘(c) DISSEMINATION.— ‘‘(1) IN GENERAL.—Model curricula developed under this 

section shall be disseminated through the Internet Clearinghouse under section 270 and such other means as determined 

appropriate by the Secretary. 

‘‘(2) EVALUATION.—The Secretary shall evaluate the adoption and the implementation of cultural competency, prevention, 

and public health, and working with individuals with a disability training curricula, and the facilitate inclusion of these 

competency measures in quality measurement systems as 

appropriate. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated to carry out this section such sums as may 

be necessary for each of fiscal years 2010 through 2015.’’. 

(b) TITLE VIII.—Section 807 of the Public Health Service Act 

(42 U.S.C. 296e–1) is amended— 

(1) in subsection (a)— 

(A) by striking the subsection heading and inserting 

‘‘CULTURAL COMPETENCY, PREVENTION, AND PUBLIC

HEALTH AND INDIVIDUALS WITH DISABILITY GRANTS’’; and 

(B) by striking ‘‘for the purpose of’’ and all that follows 

through ‘‘health care.’’ and inserting ‘‘for the development, 
H. R. 3590—511 

evaluation, and dissemination of research, demonstration 

projects, and model curricula for cultural competency, 

prevention, public health proficiency, reducing health 

disparities, and aptitude for working with individuals with 

disabilities training for use in health professions schools 

and continuing education programs, and for other purposes 

determined as appropriate by the Secretary.’’; and 

(2) by redesignating subsection (b) as subsection (d); 

(3) by inserting after subsection (a) the following: 

‘‘(b) COLLABORATION.—In carrying out subsection (a), the Secretary shall collaborate with the entities described in section 741(b). 

The Secretary shall coordinate with curricula and research and 

demonstration projects developed under such section 741. 

‘‘(c) DISSEMINATION.—Model curricula developed under this section shall be disseminated and evaluated in the same manner 

as model curricula developed under section 741, as described in 

subsection (c) of such section.’’; and 

(4) in subsection (d), as so redesignated— 

(A) by striking ‘‘subsection (a)’’ and inserting ‘‘this section’’; and 

(B) by striking ‘‘2001 through 2004’’ and inserting 

‘‘2010 through 2015’’. 

SEC. 5308. ADVANCED NURSING EDUCATION GRANTS. 

Section 811 of the Public Health Service Act (42 U.S.C. 296j) 

is amended— 

(1) in subsection (c)— 

(A) in the subsection heading, by striking ‘‘AND NURSE

MIDWIFERY PROGRAMS’’; and 

(B) by striking ‘‘and nurse midwifery’’; 

(2) in subsection (f)— 

(A) by striking paragraph (2); and 

(B) by redesignating paragraph (3) as paragraph (2); 

and 

(3) by redesignating subsections (d), (e), and (f) as subsections (e), (f), and (g), respectively; and 

(4) by inserting after subsection (c), the following: 

‘‘(d) AUTHORIZED NURSE-MIDWIFERY PROGRAMS.—Midwifery 

programs that are eligible for support under this section are educational programs that— 

‘‘(1) have as their objective the education of midwives; 

and 

‘‘(2) are accredited by the American College of Nurse-Midwives Accreditation Commission for Midwifery Education.’’. 

SEC. 5309. NURSE EDUCATION, PRACTICE, AND RETENTION GRANTS. 

(a) IN GENERAL.—Section 831 of the Public Health Service 

Act (42 U.S.C. 296p) is amended— 

(1) in the section heading, by striking ‘‘RETENTION’’ and 

inserting ‘‘QUALITY’’; 

(2) in subsection (a)— 

(A) in paragraph (1), by adding ‘‘or’’ after the semicolon; 

(B) by striking paragraph (2); and 

(C) by redesignating paragraph (3) as paragraph (2); 

(3) in subsection (b)(3), by striking ‘‘managed care, quality 

improvement’’ and inserting ‘‘coordinated care’’; 

(4) in subsection (g), by inserting ‘‘, as defined in section 

801(2),’’ after ‘‘school of nursing’’; and 
H. R. 3590—512 

(5) in subsection (h), by striking ‘‘2003 through 2007’’ and 

inserting ‘‘2010 through 2014’’. 

(b) NURSE RETENTION GRANTS.—Title VIII of the Public Health 

Service Act is amended by inserting after section 831 (42 U.S.C. 

296b) the following: 

‘‘SEC. 831A. NURSE RETENTION GRANTS. 

‘‘(a) RETENTION PRIORITY AREAS.—The Secretary may award 

grants to, and enter into contracts with, eligible entities to enhance 

the nursing workforce by initiating and maintaining nurse retention 

programs pursuant to subsection (b) or (c). 

‘‘(b) GRANTS FOR CAREER LADDER PROGRAM.—The Secretary 

may award grants to, and enter into contracts with, eligible entities 

for programs— 

‘‘(1) to promote career advancement for individuals 

including licensed practical nurses, licensed vocational nurses, 

certified nurse assistants, home health aides, diploma degree 

or associate degree nurses, to become baccalaureate prepared 

registered nurses or advanced education nurses in order to 

meet the needs of the registered nurse workforce; 

‘‘(2) developing and implementing internships and residency programs in collaboration with an accredited school of 

nursing, as defined by section 801(2), to encourage mentoring 

and the development of specialties; or 

‘‘(3) to assist individuals in obtaining education and 

training required to enter the nursing profession and advance 

within such profession. 

‘‘(c) ENHANCING PATIENT CARE DELIVERY SYSTEMS.— 

‘‘(1) GRANTS.—The Secretary may award grants to eligible 

entities to improve the retention of nurses and enhance patient 

care that is directly related to nursing activities by enhancing 

collaboration and communication among nurses and other 

health care professionals, and by promoting nurse involvement 

in the organizational and clinical decision-making processes 

of a health care facility. 

‘‘(2) PRIORITY.—In making awards of grants under this 

subsection, the Secretary shall give preference to applicants 

that have not previously received an award under this subsection (or section 831(c) as such section existed on the day 

before the date of enactment of this section). 

‘‘(3) CONTINUATION OF AN AWARD.—The Secretary shall 

make continuation of any award under this subsection beyond 

the second year of such award contingent on the recipient 

of such award having demonstrated to the Secretary measurable and substantive improvement in nurse retention or patient 

care. 

‘‘(d) OTHER PRIORITY AREAS.—The Secretary may award grants 

to, or enter into contracts with, eligible entities to address other 

areas that are of high priority to nurse retention, as determined 

by the Secretary. 

‘‘(e) REPORT.—The Secretary shall submit to the Congress before 

the end of each fiscal year a report on the grants awarded and 

the contracts entered into under this section. Each such report 

shall identify the overall number of such grants and contracts 

and provide an explanation of why each such grant or contract 

will meet the priority need of the nursing workforce. 
H. R. 3590—513 

‘‘(f) ELIGIBLE ENTITY.—For purposes of this section, the term 

‘eligible entity’ includes an accredited school of nursing, as defined 

by section 801(2), a health care facility, or a partnership of such 

a school and facility. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as may 

be necessary for each of fiscal years 2010 through 2012.’’. 

SEC. 5310. LOAN REPAYMENT AND SCHOLARSHIP PROGRAM. 

(a) LOAN REPAYMENTS AND SCHOLARSHIPS.—Section 846(a)(3) 

of the Public Health Service Act (42 U.S.C. 297n(a)(3)) is amended 

by inserting before the semicolon the following: ‘‘, or in a accredited 

school of nursing, as defined by section 801(2), as nurse faculty’’. 

(b) TECHNICAL AND CONFORMING AMENDMENTS.—Title VIII (42 

U.S.C. 296 et seq.) is amended— 

(1) by redesignating section 810 (relating to prohibition 

against discrimination by schools on the basis of sex) as section 

809 and moving such section so that it follows section 808; 

(2) in sections 835, 836, 838, 840, and 842, by striking 

the term ‘‘this subpart’’ each place it appears and inserting 

‘‘this part’’; 

(3) in section 836(h), by striking the last sentence; 

(4) in section 836, by redesignating subsection (l) as subsection (k); 

(5) in section 839, by striking ‘‘839’’ and all that follows 

through ‘‘(a)’’ and inserting ‘‘839. (a)’’; 

(6) in section 835(b), by striking ‘‘841’’ each place it appears 

and inserting ‘‘871’’; 

(7) by redesignating section 841 as section 871, moving 

part F to the end of the title, and redesignating such part 

as part I; 

(8) in part G— 

(A) by redesignating section 845 as section 851; and 

(B) by redesignating part G as part F; 

(9) in part H— 

(A) by redesignating sections 851 and 852 as sections 

861 and 862, respectively; and 

(B) by redesignating part H as part G; and 

(10) in part I— 

(A) by redesignating section 855, as amended by section 

5305, as section 865; and 

(B) by redesignating part I as part H. 

SEC. 5311. NURSE FACULTY LOAN PROGRAM. 

(a) IN GENERAL.—Section 846A of the Public Health Service 

Act (42 U.S.C. 297n–1) is amended— 

(1) in subsection (a)— 

(A) in the subsection heading, by striking ‘‘ESTABLISHMENT’’ and inserting ‘‘SCHOOL OF NURSING STUDENT LOAN

FUND’’; and 

(B) by inserting ‘‘accredited’’ after ‘‘agreement with 

any’’; 

(2) in subsection (c)— 

(A) in paragraph (2), by striking ‘‘$30,000’’ and all 

that follows through the semicolon and inserting ‘‘$35,500, 

during fiscal years 2010 and 2011 fiscal years (after fiscal 

year 2011, such amounts shall be adjusted to provide for 
H. R. 3590—514 

a cost-of-attendance increase for the yearly loan rate and 

the aggregate loan;’’; and 

(B) in paragraph (3)(A), by inserting ‘‘an accredited’’ 

after ‘‘faculty member in’’; 

(3) in subsection (e), by striking ‘‘a school’’ and inserting 

‘‘an accredited school’’; and 

(4) in subsection (f), by striking ‘‘2003 through 2007’’ and 

inserting ‘‘2010 through 2014’’. 

(b) ELIGIBLE INDIVIDUAL STUDENT LOAN REPAYMENT.—Title 

VIII of the Public Health Service Act is amended by inserting 

after section 846A (42 U.S.C. 297n–1) the following: 

‘‘SEC. 847. ELIGIBLE INDIVIDUAL STUDENT LOAN REPAYMENT. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Administrator of the Health Resources and Services Administration, may 

enter into an agreement with eligible individuals for the repayment 

of education loans, in accordance with this section, to increase 

the number of qualified nursing faculty. 

‘‘(b) AGREEMENTS.—Each agreement entered into under this 

subsection shall require that the eligible individual shall serve 

as a full-time member of the faculty of an accredited school of 

nursing, for a total period, in the aggregate, of at least 4 years 

during the 6-year period beginning on the later of— 

‘‘(1) the date on which the individual receives a master’s 

or doctorate nursing degree from an accredited school of 

nursing; or 

‘‘(2) the date on which the individual enters into an agreement under this subsection. 

‘‘(c) AGREEMENT PROVISIONS.—Agreements entered into pursuant to subsection (b) shall be entered into on such terms and 

conditions as the Secretary may determine, except that— 

‘‘(1) not more than 10 months after the date on which 

the 6-year period described under subsection (b) begins, but 

in no case before the individual starts as a full-time member 

of the faculty of an accredited school of nursing the Secretary 

shall begin making payments, for and on behalf of that individual, on the outstanding principal of, and interest on, any 

loan of that individual obtained to pay for such degree; 

‘‘(2) for an individual who has completed a master’s in 

nursing or equivalent degree in nursing— 

‘‘(A) payments may not exceed $10,000 per calendar 

year; and 

‘‘(B) total payments may not exceed $40,000 during 

the 2010 and 2011 fiscal years (after fiscal year 2011, 

such amounts shall be adjusted to provide for a cost-ofattendance increase for the yearly loan rate and the aggregate loan); and 

‘‘(3) for an individual who has completed a doctorate or 

equivalent degree in nursing— 

‘‘(A) payments may not exceed $20,000 per calendar 

year; and 

‘‘(B) total payments may not exceed $80,000 during 

the 2010 and 2011 fiscal years (adjusted for subsequent 

fiscal years as provided for in the same manner as in 

paragraph (2)(B)). 

‘‘(d) BREACH OF AGREEMENT.— 
H. R. 3590—515 

‘‘(1) IN GENERAL.—In the case of any agreement made 

under subsection (b), the individual is liable to the Federal 

Government for the total amount paid by the Secretary under 

such agreement, and for interest on such amount at the maximum legal prevailing rate, if the individual fails to meet the 

agreement terms required under such subsection. 

‘‘(2) WAIVER OR SUSPENSION OF LIABILITY.—In the case 

of an individual making an agreement for purposes of paragraph (1), the Secretary shall provide for the waiver or suspension of liability under such paragraph if compliance by the 

individual with the agreement involved is impossible or would 

involve extreme hardship to the individual or if enforcement 

of the agreement with respect to the individual would be unconscionable. 

‘‘(3) DATE CERTAIN FOR RECOVERY.—Subject to paragraph 

(2), any amount that the Federal Government is entitled to 

recover under paragraph (1) shall be paid to the United States 

not later than the expiration of the 3-year period beginning 

on the date the United States becomes so entitled. 

‘‘(4) AVAILABILITY.—Amounts recovered under paragraph 

(1) shall be available to the Secretary for making loan repayments under this section and shall remain available for such 

purpose until expended. 

‘‘(e) ELIGIBLE INDIVIDUAL DEFINED.—For purposes of this section, the term ‘eligible individual’ means an individual who— 

‘‘(1) is a United States citizen, national, or lawful permanent resident; 

‘‘(2) holds an unencumbered license as a registered nurse; 

and 

‘‘(3) has either already completed a master’s or doctorate 

nursing program at an accredited school of nursing or is currently enrolled on a full-time or part-time basis in such a 

program. 

‘‘(f) PRIORITY.—For the purposes of this section and section 

846A, funding priority will be awarded to School of Nursing Student 

Loans that support doctoral nursing students or Individual Student 

Loan Repayment that support doctoral nursing students. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as may 

be necessary for each of fiscal years 2010 through 2014.’’. 

SEC. 5312. AUTHORIZATION OF APPROPRIATIONS FOR PARTS B 

THROUGH D OF TITLE VIII. 

Section 871 of the Public Health Service Act, as redesignated 

and moved by section 5310, is amended to read as follows: 

‘‘SEC. 871. AUTHORIZATION OF APPROPRIATIONS. 

‘‘For the purpose of carrying out parts B, C, and D (subject 

to section 851(g)), there are authorized to be appropriated 

$338,000,000 for fiscal year 2010, and such sums as may be necessary for each of the fiscal years 2011 through 2016.’’. 

SEC. 5313. GRANTS TO PROMOTE THE COMMUNITY HEALTH 

WORKFORCE. 

(a) IN GENERAL.—Part P of title III of the Public Health Service 

Act (42 U.S.C. 280g et seq.) is amended by adding at the end 

the following: 
H. R. 3590—516 

‘‘SEC. 399V. GRANTS TO PROMOTE POSITIVE HEALTH BEHAVIORS AND 

OUTCOMES. 

‘‘(a) GRANTS AUTHORIZED.—The Director of the Centers for Disease Control and Prevention, in collaboration with the Secretary, 

shall award grants to eligible entities to promote positive health 

behaviors and outcomes for populations in medically underserved 

communities through the use of community health workers. 

‘‘(b) USE OF FUNDS.—Grants awarded under subsection (a) shall 

be used to support community health workers— 

‘‘(1) to educate, guide, and provide outreach in a community 

setting regarding health problems prevalent in medically underserved communities, particularly racial and ethnic minority 

populations; 

‘‘(2) to educate and provide guidance regarding effective 

strategies to promote positive health behaviors and discourage 

risky health behaviors; 

‘‘(3) to educate and provide outreach regarding enrollment 

in health insurance including the Children’s Health Insurance 

Program under title XXI of the Social Security Act, Medicare 

under title XVIII of such Act and Medicaid under title XIX 

of such Act; 

‘‘(4) to identify, educate, refer, and enroll underserved populations to appropriate healthcare agencies and communitybased programs and organizations in order to increase access 

to quality healthcare services and to eliminate duplicative care; 

or 

‘‘(5) to educate, guide, and provide home visitation services 

regarding maternal health and prenatal care. 

‘‘(c) APPLICATION.—Each eligible entity that desires to receive 

a grant under subsection (a) shall submit an application to the 

Secretary, at such time, in such manner, and accompanied by 

such information as the Secretary may require. 

‘‘(d) PRIORITY.—In awarding grants under subsection (a), the 

Secretary shall give priority to applicants that— 

‘‘(1) propose to target geographic areas— 

‘‘(A) with a high percentage of residents who are 

eligible for health insurance but are uninsured or underinsured; 

‘‘(B) with a high percentage of residents who suffer 

from chronic diseases; or 

‘‘(C) with a high infant mortality rate; 

‘‘(2) have experience in providing health or health-related 

social services to individuals who are underserved with respect 

to such services; and 

‘‘(3) have documented community activity and experience 

with community health workers. 

‘‘(e) COLLABORATION WITH ACADEMIC INSTITUTIONS AND THE

ONE-STOP DELIVERY SYSTEM.—The Secretary shall encourage 

community health worker programs receiving funds under this section to collaborate with academic institutions and one-stop delivery 

systems under section 134(c) of the Workforce Investment Act of 

1998. Nothing in this section shall be construed to require such 

collaboration. 

‘‘(f) EVIDENCE-BASED INTERVENTIONS.—The Secretary shall 

encourage community health worker programs receiving funding 

under this section to implement a process or an outcome-based 
H. R. 3590—517 

payment system that rewards community health workers for connecting underserved populations with the most appropriate services 

at the most appropriate time. Nothing in this section shall be 

construed to require such a payment. 

‘‘(g) QUALITY ASSURANCE AND COST EFFECTIVENESS.—The Secretary shall establish guidelines for assuring the quality of the 

training and supervision of community health workers under the 

programs funded under this section and for assuring the costeffectiveness of such programs. 

‘‘(h) MONITORING.—The Secretary shall monitor community 

health worker programs identified in approved applications under 

this section and shall determine whether such programs are in 

compliance with the guidelines established under subsection (g). 

‘‘(i) TECHNICAL ASSISTANCE.—The Secretary may provide technical assistance to community health worker programs identified 

in approved applications under this section with respect to planning, 

developing, and operating programs under the grant. 

‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated, such sums as may be necessary to carry out 

this section for each of fiscal years 2010 through 2014. 

‘‘(k) DEFINITIONS.—In this section: 

‘‘(1) COMMUNITY HEALTH WORKER.—The term ‘community 

health worker’, as defined by the Department of Labor as 

Standard Occupational Classification [21–1094] means an individual who promotes health or nutrition within the community 

in which the individual resides— 

‘‘(A) by serving as a liaison between communities and 

healthcare agencies; 

‘‘(B) by providing guidance and social assistance to 

community residents; 

‘‘(C) by enhancing community residents’ ability to effectively communicate with healthcare providers; 

‘‘(D) by providing culturally and linguistically appropriate health or nutrition education; 

‘‘(E) by advocating for individual and community 

health; 

‘‘(F) by providing referral and follow-up services or 

otherwise coordinating care; and 

‘‘(G) by proactively identifying and enrolling eligible 

individuals in Federal, State, local, private or nonprofit 

health and human services programs. 

‘‘(2) COMMUNITY SETTING.—The term ‘community setting’ 

means a home or a community organization located in the 

neighborhood in which a participant in the program under 

this section resides. 

‘‘(3) ELIGIBLE ENTITY.—The term ‘eligible entity’ means a 

public or nonprofit private entity (including a State or public 

subdivision of a State, a public health department, a free health 

clinic, a hospital, or a Federally-qualified health center (as 

defined in section 1861(aa) of the Social Security Act)), or 

a consortium of any such entities. 

‘‘(4) MEDICALLY UNDERSERVED COMMUNITY.—The term 

‘medically underserved community’ means a community identified by a State— 

‘‘(A) that has a substantial number of individuals who 

are members of a medically underserved population, as 

defined by section 330(b)(3); and 
H. R. 3590—518 

‘‘(B) a significant portion of which is a health professional shortage area as designated under section 332.’’. 

SEC. 5314. FELLOWSHIP TRAINING IN PUBLIC HEALTH. 

Part E of title VII of the Public Health Service Act (42 U.S.C. 

294n et seq.), as amended by section 5206, is further amended 

by adding at the end the following: 

‘‘SEC. 778. FELLOWSHIP TRAINING IN APPLIED PUBLIC HEALTH EPIDEMIOLOGY, PUBLIC HEALTH LABORATORY SCIENCE, 

PUBLIC HEALTH INFORMATICS, AND EXPANSION OF THE 

EPIDEMIC INTELLIGENCE SERVICE. 

‘‘(a) IN GENERAL.—The Secretary may carry out activities to 

address documented workforce shortages in State and local health 

departments in the critical areas of applied public health epidemiology and public health laboratory science and informatics and 

may expand the Epidemic Intelligence Service. 

‘‘(b) SPECIFIC USES.—In carrying out subsection (a), the Secretary shall provide for the expansion of existing fellowship programs operated through the Centers for Disease Control and 

Prevention in a manner that is designed to alleviate shortages 

of the type described in subsection (a). 

‘‘(c) OTHER PROGRAMS.—The Secretary may provide for the 

expansion of other applied epidemiology training programs that 

meet objectives similar to the objectives of the programs described 

in subsection (b). 

‘‘(d) WORK OBLIGATION.—Participation in fellowship training 

programs under this section shall be deemed to be service for 

purposes of satisfying work obligations stipulated in contracts under 

section 338I(j). 

‘‘(e) GENERAL SUPPORT.—Amounts may be used from grants 

awarded under this section to expand the Public Health Informatics 

Fellowship Program at the Centers for Disease Control and Prevention to better support all public health systems at all levels of 

government. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section $39,500,000 for each 

of fiscal years 2010 through 2013, of which— 

‘‘(1) $5,000,000 shall be made available in each such fiscal 

year for epidemiology fellowship training program activities 

under subsections (b) and (c); 

‘‘(2) $5,000,000 shall be made available in each such fiscal 

year for laboratory fellowship training programs under subsection (b); 

‘‘(3) $5,000,000 shall be made available in each such fiscal 

year for the Public Health Informatics Fellowship Program 

under subsection (e); and 

‘‘(4) $24,500,000 shall be made available for expanding 

the Epidemic Intelligence Service under subsection (a).’’. 

SEC. 5315. UNITED STATES PUBLIC HEALTH SCIENCES TRACK. 

Title II of the Public Health Service Act (42 U.S.C. 202 et 

seq.) is amended by adding at the end the following: 
H. R. 3590—519 

‘‘PART D—UNITED STATES PUBLIC HEALTH 

SCIENCES TRACK 

‘‘SEC. 271. ESTABLISHMENT. 

‘‘(a) UNITED STATES PUBLIC HEALTH SERVICES TRACK.— ‘‘(1) IN GENERAL.—There is hereby authorized to be established a United States Public Health Sciences Track (referred 

to in this part as the ‘Track’), at sites to be selected by the 

Secretary, with authority to grant appropriate advanced 

degrees in a manner that uniquely emphasizes team-based 

service, public health, epidemiology, and emergency preparedness and response. It shall be so organized as to graduate 

not less than— 

‘‘(A) 150 medical students annually, 10 of whom shall 

be awarded studentships to the Uniformed Services University of Health Sciences; 

‘‘(B) 100 dental students annually; 

‘‘(C) 250 nursing students annually; 

‘‘(D) 100 public health students annually; 

‘‘(E) 100 behavioral and mental health professional 

students annually; 

‘‘(F) 100 physician assistant or nurse practitioner students annually; and 

‘‘(G) 50 pharmacy students annually. 

‘‘(2) LOCATIONS.—The Track shall be located at existing 

and accredited, affiliated health professions education training 

programs at academic health centers located in regions of the 

United States determined appropriate by the Surgeon General, 

in consultation with the National Health Care Workforce 

Commission established in section 5101 of the Patient Protection and Affordable Care Act. 

‘‘(b) NUMBER OF GRADUATES.—Except as provided in subsection 

(a), the number of persons to be graduated from the Track shall 

be prescribed by the Secretary. In so prescribing the number of 

persons to be graduated from the Track, the Secretary shall 

institute actions necessary to ensure the maximum number of firstyear enrollments in the Track consistent with the academic capacity 

of the affiliated sites and the needs of the United States for medical, 

dental, and nursing personnel. 

‘‘(c) DEVELOPMENT.—The development of the Track may be 

by such phases as the Secretary may prescribe subject to the 

requirements of subsection (a). 

‘‘(d) INTEGRATED LONGITUDINAL PLAN.—The Surgeon General 

shall develop an integrated longitudinal plan for health professions 

continuing education throughout the continuum of health-related 

education, training, and practice. Training under such plan shall 

emphasize patient-centered, interdisciplinary, and care coordination 

skills. Experience with deployment of emergency response teams 

shall be included during the clinical experiences. 

‘‘(e) FACULTY DEVELOPMENT.—The Surgeon General shall 

develop faculty development programs and curricula in decentralized venues of health care, to balance urban, tertiary, and inpatient 

venues. 

‘‘SEC. 272. ADMINISTRATION. 

‘‘(a) IN GENERAL.—The business of the Track shall be conducted 

by the Surgeon General with funds appropriated for and provided 
H. R. 3590—520 

by the Department of Health and Human Services. The National 

Health Care Workforce Commission shall assist the Surgeon General in an advisory capacity. 

‘‘(b) FACULTY.— 

‘‘(1) IN GENERAL.—The Surgeon General, after considering 

the recommendations of the National Health Care Workforce 

Commission, shall obtain the services of such professors, 

instructors, and administrative and other employees as may 

be necessary to operate the Track, but utilize when possible, 

existing affiliated health professions training institutions. Members of the faculty and staff shall be employed under salary 

schedules and granted retirement and other related benefits 

prescribed by the Secretary so as to place the employees of 

the Track faculty on a comparable basis with the employees 

of fully accredited schools of the health professions within the 

United States. 

‘‘(2) TITLES.—The Surgeon General may confer academic 

titles, as appropriate, upon the members of the faculty. 

‘‘(3) NONAPPLICATION OF PROVISIONS.—The limitations in 

section 5373 of title 5, United States Code, shall not apply 

to the authority of the Surgeon General under paragraph (1) 

to prescribe salary schedules and other related benefits. 

‘‘(c) AGREEMENTS.—The Surgeon General may negotiate agreements with agencies of the Federal Government to utilize on a 

reimbursable basis appropriate existing Federal medical resources 

located in the United States (or locations selected in accordance 

with section 271(a)(2)). Under such agreements the facilities concerned will retain their identities and basic missions. The Surgeon 

General may negotiate affiliation agreements with accredited 

universities and health professions training institutions in the 

United States. Such agreements may include provisions for payments for educational services provided students participating in 

Department of Health and Human Services educational programs. 

‘‘(d) PROGRAMS.—The Surgeon General may establish the following educational programs for Track students: 

‘‘(1) Postdoctoral, postgraduate, and technological programs. 

‘‘(2) A cooperative program for medical, dental, physician 

assistant, pharmacy, behavioral and mental health, public 

health, and nursing students. 

‘‘(3) Other programs that the Surgeon General determines 

necessary in order to operate the Track in a cost-effective 

manner. 

‘‘(e) CONTINUING MEDICAL EDUCATION.—The Surgeon General 

shall establish programs in continuing medical education for members of the health professions to the end that high standards of 

health care may be maintained within the United States. 

‘‘(f) AUTHORITY OF THE SURGEON GENERAL.— ‘‘(1) IN GENERAL.—The Surgeon General is authorized— 

‘‘(A) to enter into contracts with, accept grants from, 

and make grants to any nonprofit entity for the purpose 

of carrying out cooperative enterprises in medical, dental, 

physician assistant, pharmacy, behavioral and mental 

health, public health, and nursing research, consultation, 

and education; 

‘‘(B) to enter into contracts with entities under which 

the Surgeon General may furnish the services of such 
H. R. 3590—521 

professional, technical, or clerical personnel as may be necessary to fulfill cooperative enterprises undertaken by the 

Track; 

‘‘(C) to accept, hold, administer, invest, and spend any 

gift, devise, or bequest of personal property made to the 

Track, including any gift, devise, or bequest for the support 

of an academic chair, teaching, research, or demonstration 

project; 

‘‘(D) to enter into agreements with entities that may 

be utilized by the Track for the purpose of enhancing 

the activities of the Track in education, research, and 

technological applications of knowledge; and 

‘‘(E) to accept the voluntary services of guest scholars 

and other persons. 

‘‘(2) LIMITATION.—The Surgeon General may not enter into 

any contract with an entity if the contract would obligate the 

Track to make outlays in advance of the enactment of budget 

authority for such outlays. 

‘‘(3) SCIENTISTS.—Scientists or other medical, dental, or 

nursing personnel utilized by the Track under an agreement 

described in paragraph (1) may be appointed to any position 

within the Track and may be permitted to perform such duties 

within the Track as the Surgeon General may approve. 

‘‘(4) VOLUNTEER SERVICES.—A person who provides voluntary services under the authority of subparagraph (E) of 

paragraph (1) shall be considered to be an employee of the 

Federal Government for the purposes of chapter 81 of title 

5, relating to compensation for work-related injuries, and to 

be an employee of the Federal Government for the purposes 

of chapter 171 of title 28, relating to tort claims. Such a person 

who is not otherwise employed by the Federal Government 

shall not be considered to be a Federal employee for any other 

purpose by reason of the provision of such services. 

‘‘SEC. 273. STUDENTS; SELECTION; OBLIGATION. 

‘‘(a) STUDENT SELECTION.— ‘‘(1) IN GENERAL.—Medical, dental, physician assistant, 

pharmacy, behavioral and mental health, public health, and 

nursing students at the Track shall be selected under procedures prescribed by the Surgeon General. In so prescribing, 

the Surgeon General shall consider the recommendations of 

the National Health Care Workforce Commission. 

‘‘(2) PRIORITY.—In developing admissions procedures under 

paragraph (1), the Surgeon General shall ensure that such 

procedures give priority to applicant medical, dental, physician 

assistant, pharmacy, behavioral and mental health, public 

health, and nursing students from rural communities and 

underrepresented minorities. 

‘‘(b) CONTRACT AND SERVICE OBLIGATION.— 

‘‘(1) CONTRACT.—Upon being admitted to the Track, a medical, dental, physician assistant, pharmacy, behavioral and 

mental health, public health, or nursing student shall enter 

into a written contract with the Surgeon General that shall 

contain— 

‘‘(A) an agreement under which— 

‘‘(i) subject to subparagraph (B), the Surgeon General agrees to provide the student with tuition (or 
H. R. 3590—522 

tuition remission) and a student stipend (described 

in paragraph (2)) in each school year for a period 

of years (not to exceed 4 school years) determined 

by the student, during which period the student is 

enrolled in the Track at an affiliated or other participating health professions institution pursuant to an 

agreement between the Track and such institution; 

and 

‘‘(ii) subject to subparagraph (B), the student 

agrees— 

‘‘(I) to accept the provision of such tuition and 

student stipend to the student; 

‘‘(II) to maintain enrollment at the Track until 

the student completes the course of study involved; 

‘‘(III) while enrolled in such course of study, 

to maintain an acceptable level of academic 

standing (as determined by the Surgeon General); 

‘‘(IV) if pursuing a degree from a school of 

medicine or osteopathic medicine, dental, public 

health, or nursing school or a physician assistant, 

pharmacy, or behavioral and mental health professional program, to complete a residency or internship in a specialty that the Surgeon General determines is appropriate; and 

‘‘(V) to serve for a period of time (referred 

to in this part as the ‘period of obligated service’) 

within the Commissioned Corps of the Public 

Health Service equal to 2 years for each school 

year during which such individual was enrolled 

at the College, reduced as provided for in paragraph (3); 

‘‘(B) a provision that any financial obligation of the 

United States arising out of a contract entered into under 

this part and any obligation of the student which is conditioned thereon, is contingent upon funds being appropriated 

to carry out this part; 

‘‘(C) a statement of the damages to which the United 

States is entitled for the student’s breach of the contract; 

and 

‘‘(D) such other statements of the rights and liabilities 

of the Secretary and of the individual, not inconsistent 

with the provisions of this part. 

‘‘(2) TUITION AND STUDENT STIPEND.— 

‘‘(A) TUITION REMISSION RATES.—The Surgeon General, 

based on the recommendations of the National Health Care 

Workforce Commission, shall establish Federal tuition 

remission rates to be used by the Track to provide 

reimbursement to affiliated and other participating health 

professions institutions for the cost of educational services 

provided by such institutions to Track students. The agreement entered into by such participating institutions under 

paragraph (1)(A)(i) shall contain an agreement to accept 

as payment in full the established remission rate under 

this subparagraph. 

‘‘(B) STIPEND.—The Surgeon General, based on the recommendations of the National Health Care Workforce 
H. R. 3590—523 

Commission, shall establish and update Federal stipend 

rates for payment to students under this part. 

‘‘(3) REDUCTIONS IN THE PERIOD OF OBLIGATED SERVICE.— 

The period of obligated service under paragraph (1)(A)(ii)(V) 

shall be reduced— 

‘‘(A) in the case of a student who elects to participate 

in a high-needs speciality residency (as determined by the 

National Health Care Workforce Commission), by 3 months 

for each year of such participation (not to exceed a total 

of 12 months); and 

‘‘(B) in the case of a student who, upon completion 

of their residency, elects to practice in a Federal medical 

facility (as defined in section 781(e)) that is located in 

a health professional shortage area (as defined in section 

332), by 3 months for year of full-time practice in such 

a facility (not to exceed a total of 12 months). 

‘‘(c) SECOND 2 YEARS OF SERVICE.—During the third and fourth 

years in which a medical, dental, physician assistant, pharmacy, 

behavioral and mental health, public health, or nursing student 

is enrolled in the Track, training should be designed to prioritize 

clinical rotations in Federal medical facilities in health professional 

shortage areas, and emphasize a balance of hospital and communitybased experiences, and training within interdisciplinary teams. 

‘‘(d) DENTIST, PHYSICIAN ASSISTANT, PHARMACIST, BEHAVIORAL

AND MENTAL HEALTH PROFESSIONAL, PUBLIC HEALTH PROFESSIONAL, AND NURSE TRAINING.—The Surgeon General shall establish provisions applicable with respect to dental, physician assistant, 

pharmacy, behavioral and mental health, public health, and nursing 

students that are comparable to those for medical students under 

this section, including service obligations, tuition support, and stipend support. The Surgeon General shall give priority to health 

professions training institutions that train medical, dental, physician assistant, pharmacy, behavioral and mental health, public 

health, and nursing students for some significant period of time 

together, but at a minimum have a discrete and shared core curriculum. 

‘‘(e) ELITE FEDERAL DISASTER TEAMS.—The Surgeon General, 

in consultation with the Secretary, the Director of the Centers 

for Disease Control and Prevention, and other appropriate military 

and Federal government agencies, shall develop criteria for the 

appointment of highly qualified Track faculty, medical, dental, 

physician assistant, pharmacy, behavioral and mental health, public 

health, and nursing students, and graduates to elite Federal disaster preparedness teams to train and to respond to public health 

emergencies, natural disasters, bioterrorism events, and other emergencies. 

‘‘(f) STUDENT DROPPED FROM TRACK IN AFFILIATE SCHOOL.— 

A medical, dental, physician assistant, pharmacy, behavioral and 

mental health, public health, or nursing student who, under regulations prescribed by the Surgeon General, is dropped from the Track 

in an affiliated school for deficiency in conduct or studies, or for 

other reasons, shall be liable to the United States for all tuition 

and stipend support provided to the student. 
H. R. 3590—524 

‘‘SEC. 274. FUNDING. 

‘‘Beginning with fiscal year 2010, the Secretary shall transfer 

from the Public Health and Social Services Emergency Fund such 

sums as may be necessary to carry out this part.’’. 

Subtitle E—Supporting the Existing Health 

Care Workforce 

SEC. 5401. CENTERS OF EXCELLENCE. 

Section 736 of the Public Health Service Act (42 U.S.C. 293) 

is amended by striking subsection (h) and inserting the following: 

‘‘(h) FORMULA FOR ALLOCATIONS.— 

‘‘(1) ALLOCATIONS.—Based on the amount appropriated 

under subsection (i) for a fiscal year, the following subparagraphs shall apply as appropriate: 

‘‘(A) IN GENERAL.—If the amounts appropriated under 

subsection (i) for a fiscal year are $24,000,000 or less— 

‘‘(i) the Secretary shall make available $12,000,000 

for grants under subsection (a) to health professions 

schools that meet the conditions described in subsection (c)(2)(A); and 

‘‘(ii) and available after grants are made with funds 

under clause (i), the Secretary shall make available— 

‘‘(I) 60 percent of such amount for grants under 

subsection (a) to health professions schools that 

meet the conditions described in paragraph (3) 

or (4) of subsection (c) (including meeting the 

conditions under subsection (e)); and 

‘‘(II) 40 percent of such amount for grants 

under subsection (a) to health professions schools 

that meet the conditions described in subsection 

(c)(5). 

‘‘(B) FUNDING IN EXCESS OF $24,000,000.—If amounts 

appropriated under subsection (i) for a fiscal year exceed 

$24,000,000 but are less than $30,000,000— 

‘‘(i) 80 percent of such excess amounts shall be 

made available for grants under subsection (a) to 

health professions schools that meet the requirements 

described in paragraph (3) or (4) of subsection (c) 

(including meeting conditions pursuant to subsection 

(e)); and 

‘‘(ii) 20 percent of such excess amount shall be 

made available for grants under subsection (a) to 

health professions schools that meet the conditions 

described in subsection (c)(5). 

‘‘(C) FUNDING IN EXCESS OF $30,000,000.—If amounts 

appropriated under subsection (i) for a fiscal year exceed 

$30,000,000 but are less than $40,000,000, the Secretary 

shall make available— 

‘‘(i) not less than $12,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in subsection (c)(2)(A); 

‘‘(ii) not less than $12,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in paragraph (3) or (4) of 
H. R. 3590—525 

subsection (c) (including meeting conditions pursuant 

to subsection (e)); 

‘‘(iii) not less than $6,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in subsection (c)(5); and 

‘‘(iv) after grants are made with funds under 

clauses (i) through (iii), any remaining excess amount 

for grants under subsection (a) to health professions 

schools that meet the conditions described in paragraph (2)(A), (3), (4), or (5) of subsection (c). 

‘‘(D) FUNDING IN EXCESS OF $40,000,000.—If amounts 

appropriated under subsection (i) for a fiscal year are 

$40,000,000 or more, the Secretary shall make available— 

‘‘(i) not less than $16,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in subsection (c)(2)(A); 

‘‘(ii) not less than $16,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in paragraph (3) or (4) of 

subsection (c) (including meeting conditions pursuant 

to subsection (e)); 

‘‘(iii) not less than $8,000,000 for grants under 

subsection (a) to health professions schools that meet 

the conditions described in subsection (c)(5); and 

‘‘(iv) after grants are made with funds under 

clauses (i) through (iii), any remaining funds for grants 

under subsection (a) to health professions schools that 

meet the conditions described in paragraph (2)(A), (3), 

(4), or (5) of subsection (c). 

‘‘(2) NO LIMITATION.—Nothing in this subsection shall be 

construed as limiting the centers of excellence referred to in 

this section to the designated amount, or to preclude such 

entities from competing for grants under this section. 

‘‘(3) MAINTENANCE OF EFFORT.— 

‘‘(A) IN GENERAL.—With respect to activities for which 

a grant made under this part are authorized to be 

expended, the Secretary may not make such a grant to 

a center of excellence for any fiscal year unless the center 

agrees to maintain expenditures of non-Federal amounts 

for such activities at a level that is not less than the 

level of such expenditures maintained by the center for 

the fiscal year preceding the fiscal year for which the 

school receives such a grant. 

‘‘(B) USE OF FEDERAL FUNDS.—With respect to any 

Federal amounts received by a center of excellence and 

available for carrying out activities for which a grant under 

this part is authorized to be expended, the center shall, 

before expending the grant, expend the Federal amounts 

obtained from sources other than the grant, unless given 

prior approval from the Secretary. 

‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section— 

‘‘(1) $50,000,000 for each of the fiscal years 2010 through 

2015; and 

‘‘(2) and such sums as are necessary for each subsequent 

fiscal year.’’. 
H. R. 3590—526 

SEC. 5402. HEALTH CARE PROFESSIONALS TRAINING FOR DIVERSITY. 

(a) LOAN REPAYMENTS AND FELLOWSHIPS REGARDING FACULTY

POSITIONS.—Section 738(a)(1) of the Public Health Service Act (42 

U.S.C. 293b(a)(1)) is amended by striking ‘‘$20,000 of the principal 

and interest of the educational loans of such individuals.’’ and 

inserting ‘‘$30,000 of the principal and interest of the educational 

loans of such individuals.’’. 

(b) SCHOLARSHIPS FOR DISADVANTAGED STUDENTS.—Section 

740(a) of such Act (42 U.S.C. 293d(a)) is amended by striking 

‘‘$37,000,000’’ and all that follows through ‘‘2002’’ and inserting 

‘‘$51,000,000 for fiscal year 2010, and such sums as may be necessary for each of the fiscal years 2011 through 2014’’. 

(c) REAUTHORIZATION FOR LOAN REPAYMENTS AND FELLOWSHIPS

REGARDING FACULTY POSITIONS.—Section 740(b) of such Act (42 

U.S.C. 293d(b)) is amended by striking ‘‘appropriated’’ and all that 

follows through the period at the end and inserting ‘‘appropriated, 

$5,000,000 for each of the fiscal years 2010 through 2014.’’. 

(d) REAUTHORIZATION FOR EDUCATIONAL ASSISTANCE IN THE

HEALTH PROFESSIONS REGARDING INDIVIDUALS FROM A DISADVANTAGED BACKGROUND.—Section 740(c) of such Act (42 U.S.C. 293d(c)) 

is amended by striking the first sentence and inserting the following: ‘‘For the purpose of grants and contracts under section 

739(a)(1), there is authorized to be appropriated $60,000,000 for 

fiscal year 2010 and such sums as may be necessary for each 

of the fiscal years 2011 through 2014.’’ 

SEC. 5403. INTERDISCIPLINARY, COMMUNITY-BASED LINKAGES. 

(a) AREA HEALTH EDUCATION CENTERS.—Section 751 of the 

Public Health Service Act (42 U.S.C. 294a) is amended to read 

as follows: 

‘‘SEC. 751. AREA HEALTH EDUCATION CENTERS. 

‘‘(a) ESTABLISHMENT OF AWARDS.—The Secretary shall make 

the following 2 types of awards in accordance with this section: 

‘‘(1) INFRASTRUCTURE DEVELOPMENT AWARD.—The Secretary shall make awards to eligible entities to enable such 

entities to initiate health care workforce educational programs 

or to continue to carry out comparable programs that are operating at the time the award is made by planning, developing, 

operating, and evaluating an area health education center program. 

‘‘(2) POINT OF SERVICE MAINTENANCE AND ENHANCEMENT

AWARD.—The Secretary shall make awards to eligible entities 

to maintain and improve the effectiveness and capabilities of 

an existing area health education center program, and make 

other modifications to the program that are appropriate due 

to changes in demographics, needs of the populations served, 

or other similar issues affecting the area health education 

center program. For the purposes of this section, the term 

‘Program’ refers to the area health education center program. 

‘‘(b) ELIGIBLE ENTITIES; APPLICATION.— 

‘‘(1) ELIGIBLE ENTITIES.— 

‘‘(A) INFRASTRUCTURE DEVELOPMENT.—For purposes of 

subsection (a)(1), the term ‘eligible entity’ means a school 

of medicine or osteopathic medicine, an incorporated 

consortium of such schools, or the parent institutions of 

such a school. With respect to a State in which no area 
H. R. 3590—527 

health education center program is in operation, the Secretary may award a grant or contract under subsection 

(a)(1) to a school of nursing. 

‘‘(B) POINT OF SERVICE MAINTENANCE AND ENHANCEMENT.—For purposes of subsection (a)(2), the term ‘eligible 

entity’ means an entity that has received funds under 

this section, is operating an area health education center 

program, including an area health education center or centers, and has a center or centers that are no longer eligible 

to receive financial assistance under subsection (a)(1). 

‘‘(2) APPLICATION.—An eligible entity desiring to receive 

an award under this section shall submit to the Secretary 

an application at such time, in such manner, and containing 

such information as the Secretary may require. 

‘‘(c) USE OF FUNDS.— 

‘‘(1) REQUIRED ACTIVITIES.—An eligible entity shall use 

amounts awarded under a grant under subsection (a)(1) or 

(a)(2) to carry out the following activities: 

‘‘(A) Develop and implement strategies, in coordination 

with the applicable one-stop delivery system under section 

134(c) of the Workforce Investment Act of 1998, to recruit 

individuals from underrepresented minority populations or 

from disadvantaged or rural backgrounds into health 

professions, and support such individuals in attaining such 

careers. 

‘‘(B) Develop and implement strategies to foster and 

provide community-based training and education to individuals seeking careers in health professions within underserved areas for the purpose of developing and maintaining 

a diverse health care workforce that is prepared to deliver 

high-quality care, with an emphasis on primary care, in 

underserved areas or for health disparity populations, in 

collaboration with other Federal and State health care 

workforce development programs, the State workforce 

agency, and local workforce investment boards, and in 

health care safety net sites. 

‘‘(C) Prepare individuals to more effectively provide 

health services to underserved areas and health disparity 

populations through field placements or preceptorships in 

conjunction with community-based organizations, accredited primary care residency training programs, Federally 

qualified health centers, rural health clinics, public health 

departments, or other appropriate facilities. 

‘‘(D) Conduct and participate in interdisciplinary 

training that involves physicians, physician assistants, 

nurse practitioners, nurse midwives, dentists, psychologists, pharmacists, optometrists, community health 

workers, public and allied health professionals, or other 

health professionals, as practicable. 

‘‘(E) Deliver or facilitate continuing education and 

information dissemination programs for health care professionals, with an emphasis on individuals providing care 

in underserved areas and for health disparity populations. 

‘‘(F) Propose and implement effective program and outcomes measurement and evaluation strategies. 
H. R. 3590—528 

‘‘(G) Establish a youth public health program to expose 

and recruit high school students into health careers, with 

a focus on careers in public health. 

‘‘(2) INNOVATIVE OPPORTUNITIES.—An eligible entity may 

use amounts awarded under a grant under subsection (a)(1) 

or subsection (a)(2) to carry out any of the following activities: 

‘‘(A) Develop and implement innovative curricula in 

collaboration with community-based accredited primary 

care residency training programs, Federally qualified 

health centers, rural health clinics, behavioral and mental 

health facilities, public health departments, or other appropriate facilities, with the goal of increasing the number 

of primary care physicians and other primary care providers prepared to serve in underserved areas and health 

disparity populations. 

‘‘(B) Coordinate community-based participatory 

research with academic health centers, and facilitate rapid 

flow and dissemination of evidence-based health care 

information, research results, and best practices to improve 

quality, efficiency, and effectiveness of health care and 

health care systems within community settings. 

‘‘(C) Develop and implement other strategies to address 

identified workforce needs and increase and enhance the 

health care workforce in the area served by the area health 

education center program. 

‘‘(d) REQUIREMENTS.— 

‘‘(1) AREA HEALTH EDUCATION CENTER PROGRAM.—In carrying out this section, the Secretary shall ensure the following: 

‘‘(A) An entity that receives an award under this section 

shall conduct at least 10 percent of clinical education 

required for medical students in community settings that 

are removed from the primary teaching facility of the contracting institution for grantees that operate a school of 

medicine or osteopathic medicine. In States in which an 

entity that receives an award under this section is a 

nursing school or its parent institution, the Secretary shall 

alternatively ensure that— 

‘‘(i) the nursing school conducts at least 10 percent 

of clinical education required for nursing students in 

community settings that are remote from the primary 

teaching facility of the school; and 

‘‘(ii) the entity receiving the award maintains a 

written agreement with a school of medicine or osteopathic medicine to place students from that school 

in training sites in the area health education center 

program area. 

‘‘(B) An entity receiving funds under subsection (a)(2) 

does not distribute such funding to a center that is eligible 

to receive funding under subsection (a)(1). 

‘‘(2) AREA HEALTH EDUCATION CENTER.—The Secretary shall 

ensure that each area health education center program includes 

at least 1 area health education center, and that each such 

center— 

‘‘(A) is a public or private organization whose structure, 

governance, and operation is independent from the awardee 

and the parent institution of the awardee; 
H. R. 3590—529 

‘‘(B) is not a school of medicine or osteopathic medicine, 

the parent institution of such a school, or a branch campus 

or other subunit of a school of medicine or osteopathic 

medicine or its parent institution, or a consortium of such 

entities; 

‘‘(C) designates an underserved area or population to 

be served by the center which is in a location removed 

from the main location of the teaching facilities of the 

schools participating in the program with such center and 

does not duplicate, in whole or in part, the geographic 

area or population served by any other center; 

‘‘(D) fosters networking and collaboration among 

communities and between academic health centers and 

community-based centers; 

‘‘(E) serves communities with a demonstrated need 

of health professionals in partnership with academic medical centers; 

‘‘(F) addresses the health care workforce needs of the 

communities served in coordination with the public 

workforce investment system; and 

‘‘(G) has a community-based governing or advisory 

board that reflects the diversity of the communities 

involved. 

‘‘(e) MATCHING FUNDS.—With respect to the costs of operating 

a program through a grant under this section, to be eligible for 

financial assistance under this section, an entity shall make available (directly or through contributions from State, county or municipal governments, or the private sector) recurring non-Federal contributions in cash or in kind, toward such costs in an amount 

that is equal to not less than 50 percent of such costs. At least 

25 percent of the total required non-Federal contributions shall 

be in cash. An entity may apply to the Secretary for a waiver 

of not more than 75 percent of the matching fund amount required 

by the entity for each of the first 3 years the entity is funded 

through a grant under subsection (a)(1). 

‘‘(f) LIMITATION.—Not less than 75 percent of the total amount 

provided to an area health education center program under subsection (a)(1) or (a)(2) shall be allocated to the area health education 

centers participating in the program under this section. To provide 

needed flexibility to newly funded area health education center 

programs, the Secretary may waive the requirement in the sentence 

for the first 2 years of a new area health education center program 

funded under subsection (a)(1). 

‘‘(g) AWARD.—An award to an entity under this section shall 

be not less than $250,000 annually per area health education center 

included in the program involved. If amounts appropriated to carry 

out this section are not sufficient to comply with the preceding 

sentence, the Secretary may reduce the per center amount provided 

for in such sentence as necessary, provided the distribution established in subsection (j)(2) is maintained. 

‘‘(h) PROJECT TERMS.— 

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

the period during which payments may be made under an 

award under subsection (a)(1) may not exceed— 

‘‘(A) in the case of a program, 12 years; or 

‘‘(B) in the case of a center within a program, 6 years. 
H. R. 3590—530 

‘‘(2) EXCEPTION.—The periods described in paragraph (1) 

shall not apply to programs receiving point of service maintenance and enhancement awards under subsection (a)(2) to 

maintain existing centers and activities. 

‘‘(i) INAPPLICABILITY OF PROVISION.—Notwithstanding any other 

provision of this title, section 791(a) shall not apply to an area 

health education center funded under this section. 

‘‘(j) AUTHORIZATION OF APPROPRIATIONS.— 

‘‘(1) IN GENERAL.—There is authorized to be appropriated 

to carry out this section $125,000,000 for each of the fiscal 

years 2010 through 2014. 

‘‘(2) REQUIREMENTS.—Of the amounts appropriated for a 

fiscal year under paragraph (1)— 

‘‘(A) not more than 35 percent shall be used for awards 

under subsection (a)(1); 

‘‘(B) not less than 60 percent shall be used for awards 

under subsection (a)(2); 

‘‘(C) not more than 1 percent shall be used for grants 

and contracts to implement outcomes evaluation for the 

area health education centers; and 

‘‘(D) not more than 4 percent shall be used for grants 

and contracts to provide technical assistance to entities 

receiving awards under this section. 

‘‘(3) CARRYOVER FUNDS.—An entity that receives an award 

under this section may carry over funds from 1 fiscal year 

to another without obtaining approval from the Secretary. In 

no case may any funds be carried over pursuant to the preceding sentence for more than 3 years. 

‘‘(k) SENSE OF CONGRESS.—It is the sense of the Congress 

that every State have an area health education center program 

in effect under this section.’’. 

(b) CONTINUING EDUCATIONAL SUPPORT FOR HEALTH PROFESSIONALS SERVING IN UNDERSERVED COMMUNITIES.—Part D of title 

VII of the Public Health Service Act (42 U.S.C. 294 et seq.) is 

amended by striking section 752 and inserting the following: 

‘‘SEC. 752. CONTINUING EDUCATIONAL SUPPORT FOR HEALTH 

PROFESSIONALS SERVING IN UNDERSERVED COMMUNITIES. 

‘‘(a) IN GENERAL.—The Secretary shall make grants to, and 

enter into contracts with, eligible entities to improve health care, 

increase retention, increase representation of minority faculty members, enhance the practice environment, and provide information 

dissemination and educational support to reduce professional isolation through the timely dissemination of research findings using 

relevant resources. 

‘‘(b) ELIGIBLE ENTITIES.—For purposes of this section, the term 

‘eligible entity’ means an entity described in section 799(b). 

‘‘(c) APPLICATION.—An eligible entity desiring to receive an 

award under this section shall submit to the Secretary an application at such time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(d) USE OF FUNDS.—An eligible entity shall use amounts 

awarded under a grant or contract under this section to provide 
H. R. 3590—531 

innovative supportive activities to enhance education through distance learning, continuing educational activities, collaborative conferences, and electronic and telelearning activities, with priority 

for primary care. 

‘‘(e) AUTHORIZATION.—There is authorized to be appropriated to carry out this section $5,000,000 for each of the fiscal years 

2010 through 2014, and such sums as may be necessary for each 

subsequent fiscal year.’’. 

SEC. 5404. WORKFORCE DIVERSITY GRANTS. 

Section 821 of the Public Health Service Act (42 U.S.C. 296m) 

is amended— 

(1) in subsection (a)— 

(A) by striking ‘‘The Secretary may’’ and inserting the 

following: 

‘‘(1) AUTHORITY.—The Secretary may’’; 

(B) by striking ‘‘pre-entry preparation, and retention 

activities’’ and inserting the following: ‘‘stipends for diploma 

or associate degree nurses to enter a bridge or degree 

completion program, student scholarships or stipends for 

accelerated nursing degree programs, pre-entry preparation, advanced education preparation, and retention activities’’; and 

(2) in subsection (b)— 

(A) by striking ‘‘First’’ and all that follows through 

‘‘including the’’ and inserting ‘‘National Advisory Council 

on Nurse Education and Practice and consult with nursing 

associations including the National Coalition of Ethnic 

Minority Nurse Associations,’’; and 

(B) by inserting before the period the following: ‘‘, 

and other organizations determined appropriate by the Secretary’’. 

SEC. 5405. PRIMARY CARE EXTENSION PROGRAM. 

Part P of title III of the Public Health Service Act (42 U.S.C. 

280g et seq.), as amended by section 5313, is further amended 

by adding at the end the following: 

‘‘SEC. 399W. PRIMARY CARE EXTENSION PROGRAM. 

‘‘(a) ESTABLISHMENT, PURPOSE AND DEFINITION.— ‘‘(1) IN GENERAL.—The Secretary, acting through the 

Director of the Agency for Healthcare Research and Quality, 

shall establish a Primary Care Extension Program. 

‘‘(2) PURPOSE.—The Primary Care Extension Program shall 

provide support and assistance to primary care providers to 

educate providers about preventive medicine, health promotion, 

chronic disease management, mental and behavioral health 

services (including substance abuse prevention and treatment 

services), and evidence-based and evidence-informed therapies 

and techniques, in order to enable providers to incorporate 

such matters into their practice and to improve community 

health by working with community-based health connectors 

(referred to in this section as ‘Health Extension Agents’). 

‘‘(3) DEFINITIONS.—In this section: 

‘‘(A) HEALTH EXTENSION AGENT.—The term ‘Health 

Extension Agent’ means any local, community-based health 

worker who facilitates and provides assistance to primary 

care practices by implementing quality improvement or 
H. R. 3590—532 

system redesign, incorporating the principles of the patientcentered medical home to provide high-quality, effective, 

efficient, and safe primary care and to provide guidance 

to patients in culturally and linguistically appropriate 

ways, and linking practices to diverse health system 

resources. 

‘‘(B) PRIMARY CARE PROVIDER.—The term ‘primary care 

provider’ means a clinician who provides integrated, accessible health care services and who is accountable for 

addressing a large majority of personal health care needs, 

including providing preventive and health promotion services for men, women, and children of all ages, developing 

a sustained partnership with patients, and practicing in 

the context of family and community, as recognized by 

a State licensing or regulatory authority, unless otherwise 

specified in this section. 

‘‘(b) GRANTS TO ESTABLISH STATE HUBS AND LOCAL PRIMARY

CARE EXTENSION AGENCIES.— 

‘‘(1) GRANTS.—The Secretary shall award competitive 

grants to States for the establishment of State- or multistatelevel primary care Primary Care Extension Program State Hubs 

(referred to in this section as ‘Hubs’). 

‘‘(2) COMPOSITION OF HUBS.—A Hub established by a State 

pursuant to paragraph (1)— 

‘‘(A) shall consist of, at a minimum, the State health 

department, the entity responsible for administering the 

State Medicaid program (if other than the State health 

department), the State-level entity administering the Medicare program, and the departments of 1 or more health 

professions schools in the State that train providers in 

primary care; and 

‘‘(B) may include entities such as hospital associations, 

primary care practice-based research networks, health 

professional societies, State primary care associations, 

State licensing boards, organizations with a contract with 

the Secretary under section 1153 of the Social Security 

Act, consumer groups, and other appropriate entities. 

‘‘(c) STATE AND LOCAL ACTIVITIES.— 

‘‘(1) HUB ACTIVITIES.—Hubs established under a grant 

under subsection (b) shall— 

‘‘(A) submit to the Secretary a plan to coordinate functions with quality improvement organizations and area 

health education centers if such entities are members of 

the Hub not described in subsection (b)(2)(A); 

‘‘(B) contract with a county- or local-level entity that 

shall serve as the Primary Care Extension Agency to 

administer the services described in paragraph (2); 

‘‘(C) organize and administer grant funds to countyor local-level Primary Care Extension Agencies that serve 

a catchment area, as determined by the State; and 

‘‘(D) organize State-wide or multistate networks of 

local-level Primary Care Extension Agencies to share and 

disseminate information and practices. 

‘‘(2) LOCAL PRIMARY CARE EXTENSION AGENCY ACTIVITIES.— 

‘‘(A) REQUIRED ACTIVITIES.—Primary Care Extension 

Agencies established by a Hub under paragraph (1) shall— 
H. R. 3590—533 

‘‘(i) assist primary care providers to implement 

a patient-centered medical home to improve the accessibility, quality, and efficiency of primary care services, 

including health homes; 

‘‘(ii) develop and support primary care learning 

communities to enhance the dissemination of research 

findings for evidence-based practice, assess 

implementation of practice improvement, share best 

practices, and involve community clinicians in the 

generation of new knowledge and identification of 

important questions for research; 

‘‘(iii) participate in a national network of Primary 

Care Extension Hubs and propose how the Primary 

Care Extension Agency will share and disseminate lessons learned and best practices; and 

‘‘(iv) develop a plan for financial sustainability 

involving State, local, and private contributions, to provide for the reduction in Federal funds that is expected 

after an initial 6-year period of program establishment, 

infrastructure development, and planning. 

‘‘(B) DISCRETIONARY ACTIVITIES.—Primary Care Extension Agencies established by a Hub under paragraph (1) 

may— 

‘‘(i) provide technical assistance, training, and 

organizational support for community health teams 

established under section 3602 of the Patient Protection and Affordable Care Act; 

‘‘(ii) collect data and provision of primary care 

provider feedback from standardized measurements of 

processes and outcomes to aid in continuous performance improvement; 

‘‘(iii) collaborate with local health departments, 

community health centers, tribes and tribal entities, 

and other community agencies to identify community 

health priorities and local health workforce needs, and 

participate in community-based efforts to address the 

social and primary determinants of health, strengthen 

the local primary care workforce, and eliminate health 

disparities; 

‘‘(iv) develop measures to monitor the impact of 

the proposed program on the health of practice 

enrollees and of the wider community served; and 

‘‘(v) participate in other activities, as determined 

appropriate by the Secretary. 

‘‘(d) FEDERAL PROGRAM ADMINISTRATION.— 

‘‘(1) GRANTS; TYPES.—Grants awarded under subsection (b) 

shall be— 

‘‘(A) program grants, that are awarded to State or 

multistate entities that submit fully-developed plans for 

the implementation of a Hub, for a period of 6 years; 

or 

‘‘(B) planning grants, that are awarded to State or 

multistate entities with the goal of developing a plan for 

a Hub, for a period of 2 years. 

‘‘(2) APPLICATIONS.—To be eligible for a grant under subsection (b), a State or multistate entity shall submit to the 
H. R. 3590—534 

Secretary an application, at such time, in such manner, and 

containing such information as the Secretary may require. 

‘‘(3) EVALUATION.—A State that receives a grant under 

subsection (b) shall be evaluated at the end of the grant period 

by an evaluation panel appointed by the Secretary. 

‘‘(4) CONTINUING SUPPORT.—After the sixth year in which 

assistance is provided to a State under a grant awarded under 

subsection (b), the State may receive additional support under 

this section if the State program has received satisfactory 

evaluations with respect to program performance and the 

merits of the State sustainability plan, as determined by the 

Secretary. 

‘‘(5) LIMITATION.—A State shall not use in excess of 10 

percent of the amount received under a grant to carry out 

administrative activities under this section. Funds awarded 

pursuant to this section shall not be used for funding direct 

patient care. 

‘‘(e) REQUIREMENTS ON THE SECRETARY.—In carrying out this 

section, the Secretary shall consult with the heads of other Federal 

agencies with demonstrated experience and expertise in health 

care and preventive medicine, such as the Centers for Disease 

Control and Prevention, the Substance Abuse and Mental Health 

Administration, the Health Resources and Services Administration, 

the National Institutes of Health, the Office of the National Coordinator for Health Information Technology, the Indian Health Service, 

the Agricultural Cooperative Extension Service of the Department 

of Agriculture, and other entities, as the Secretary determines 

appropriate. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—To awards grants as 

provided in subsection (d), there are authorized to be appropriated 

$120,000,000 for each of fiscal years 2011 and 2012, and such 

sums as may be necessary to carry out this section for each of 

fiscal years 2013 through 2014.’’. 

Subtitle F—Strengthening Primary Care 

and Other Workforce Improvements 

SEC. 5501. EXPANDING ACCESS TO PRIMARY CARE SERVICES AND GENERAL SURGERY SERVICES. 

(a) INCENTIVE PAYMENT PROGRAM FOR PRIMARY CARE SERV- ICES.— (1) IN GENERAL.—Section 1833 of the Social Security Act 

(42 U.S.C. 1395l) is amended by adding at the end the following 

new subsection: 

‘‘(x) INCENTIVE PAYMENTS FOR PRIMARY CARE SERVICES.— ‘‘(1) IN GENERAL.—In the case of primary care services 

furnished on or after January 1, 2011, and before January 

1, 2016, by a primary care practitioner, in addition to the 

amount of payment that would otherwise be made for such 

services under this part, there also shall be paid (on a monthly 

or quarterly basis) an amount equal to 10 percent of the payment amount for the service under this part. 

‘‘(2) DEFINITIONS.—In this subsection: 

‘‘(A) PRIMARY CARE PRACTITIONER.—The term ‘primary 

care practitioner’ means an individual— 

‘‘(i) who— 
H. R. 3590—535 

‘‘(I) is a physician (as described in section 

1861(r)(1)) who has a primary specialty designation of family medicine, internal medicine, geriatric 

medicine, or pediatric medicine; or 

‘‘(II) is a nurse practitioner, clinical nurse specialist, or physician assistant (as those terms are 

defined in section 1861(aa)(5)); and 

‘‘(ii) for whom primary care services accounted for 

at least 60 percent of the allowed charges under this 

part for such physician or practitioner in a prior period 

as determined appropriate by the Secretary. 

‘‘(B) PRIMARY CARE SERVICES.—The term ‘primary care 

services’ means services identified, as of January 1, 2009, 

by the following HCPCS codes (and as subsequently modified by the Secretary): 

‘‘(i) 99201 through 99215. 

‘‘(ii) 99304 through 99340. 

‘‘(iii) 99341 through 99350. 

‘‘(3) COORDINATION WITH OTHER PAYMENTS.—The amount 

of the additional payment for a service under this subsection 

and subsection (m) shall be determined without regard to any 

additional payment for the service under subsection (m) and 

this subsection, respectively. 

‘‘(4) LIMITATION ON REVIEW.—There shall be no administrative or judicial review under section 1869, 1878, or otherwise, 

respecting the identification of primary care practitioners under 

this subsection.’’. 

(2) CONFORMING AMENDMENT.—Section 1834(g)(2)(B) of the 

Social Security Act (42 U.S.C. 1395m(g)(2)(B)) is amended by 

adding at the end the following sentence: ‘‘Section 1833(x) shall 

not be taken into account in determining the amounts that 

would otherwise be paid pursuant to the preceding sentence.’’. 

(b) INCENTIVE PAYMENT PROGRAM FOR MAJOR SURGICAL PROCE- DURES FURNISHED IN HEALTH PROFESSIONAL SHORTAGE AREAS.— (1) IN GENERAL.—Section 1833 of the Social Security Act 

(42 U.S.C. 1395l), as amended by subsection (a)(1), is amended 

by adding at the end the following new subsection: 

‘‘(y) INCENTIVE PAYMENTS FOR MAJOR SURGICAL PROCEDURES

FURNISHED IN HEALTH PROFESSIONAL SHORTAGE AREAS.— 

‘‘(1) IN GENERAL.—In the case of major surgical procedures 

furnished on or after January 1, 2011, and before January 

1, 2016, by a general surgeon in an area that is designated 

(under section 332(a)(1)(A) of the Public Health Service Act) 

as a health professional shortage area as identified by the 

Secretary prior to the beginning of the year involved, in addition 

to the amount of payment that would otherwise be made for 

such services under this part, there also shall be paid (on 

a monthly or quarterly basis) an amount equal to 10 percent 

of the payment amount for the service under this part. 

‘‘(2) DEFINITIONS.—In this subsection: 

‘‘(A) GENERAL SURGEON.—In this subsection, the term 

‘general surgeon’ means a physician (as described in section 

1861(r)(1)) who has designated CMS specialty code 02– 

General Surgery as their primary specialty code in the 

physician’s enrollment under section 1866(j). 

‘‘(B) MAJOR SURGICAL PROCEDURES.—The term ‘major 

surgical procedures’ means physicians’ services which are 
H. R. 3590—536 

surgical procedures for which a 10-day or 90-day global 

period is used for payment under the fee schedule under 

section 1848(b). 

‘‘(3) COORDINATION WITH OTHER PAYMENTS.—The amount 

of the additional payment for a service under this subsection 

and subsection (m) shall be determined without regard to any 

additional payment for the service under subsection (m) and 

this subsection, respectively. 

‘‘(4) APPLICATION.—The provisions of paragraph (2) and 

(4) of subsection (m) shall apply to the determination of additional payments under this subsection in the same manner 

as such provisions apply to the determination of additional 

payments under subsection (m).’’. 

(2) CONFORMING AMENDMENT.—Section 1834(g)(2)(B) of the 

Social Security Act (42 U.S.C. 1395m(g)(2)(B)), as amended 

by subsection (a)(2), is amended by striking ‘‘Section 1833(x)’’ 

and inserting ‘‘Subsections (x) and (y) of section 1833’’ in the 

last sentence. 

(c) BUDGET-NEUTRALITY ADJUSTMENT.—Section 1848(c)(2)(B) of 

the Social Security Act (42 U.S.C. 1395w–4(c)(2)(B)) is amended 

by adding at the end the following new clause: 

‘‘(vii) ADJUSTMENT FOR CERTAIN PHYSICIAN INCENTIVE PAYMENTS.—Fifty percent of the additional 

expenditures under this part attributable to subsections (x) and (y) of section 1833 for a year (as 

estimated by the Secretary) shall be taken into account 

in applying clause (ii)(II) for 2011 and subsequent 

years. In lieu of applying the budget-neutrality adjustments required under clause (ii)(II) to relative value 

units to account for such costs for the year, the Secretary shall apply such budget-neutrality adjustments 

to the conversion factor otherwise determined for the 

year. For 2011 and subsequent years, the Secretary 

shall increase the incentive payment otherwise 

applicable under section 1833(m) by a percent estimated to be equal to the additional expenditures estimated under the first sentence of this clause for such 

year that is applicable to physicians who primarily 

furnish services in areas designated (under section 

332(a)(1)(A) of the Public Health Service Act) as health 

professional shortage areas.’’. 

SEC. 5502. MEDICARE FEDERALLY QUALIFIED HEALTH CENTER 

IMPROVEMENTS. 

(a) EXPANSION OF MEDICARE-COVERED PREVENTIVE SERVICES

AT FEDERALLY QUALIFIED HEALTH CENTERS.— 

(1) IN GENERAL.—Section 1861(aa)(3)(A) of the Social Security Act (42 U.S.C. 1395w (aa)(3)(A)) is amended to read as 

follows: 

‘‘(A) services of the type described subparagraphs (A) 

through (C) of paragraph (1) and preventive services (as 

defined in section 1861(ddd)(3)); and’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply to services furnished on or after January 1, 

2011. 

(b) PROSPECTIVE PAYMENT SYSTEM FOR FEDERALLY QUALIFIED

HEALTH CENTERS.—Section 1834 of the Social Security Act (42 
H. R. 3590—537 

U.S.C. 1395m) is amended by adding at the end the following 

new subsection: 

‘‘(n) DEVELOPMENT AND IMPLEMENTATION OF PROSPECTIVE PAYMENT SYSTEM.— 

‘‘(1) DEVELOPMENT.— 

‘‘(A) IN GENERAL.—The Secretary shall develop a 

prospective payment system for payment for Federally 

qualified health services furnished by Federally qualified 

health centers under this title. Such system shall include 

a process for appropriately describing the services furnished by Federally qualified health centers. 

‘‘(B) COLLECTION OF DATA AND EVALUATION.—The Secretary shall require Federally qualified health centers to 

submit to the Secretary such information as the Secretary 

may require in order to develop and implement the prospective payment system under this paragraph and paragraph 

(2), respectively, including the reporting of services using 

HCPCS codes. 

‘‘(2) IMPLEMENTATION.— 

‘‘(A) IN GENERAL.—Notwithstanding section 

1833(a)(3)(B), the Secretary shall provide, for cost reporting 

periods beginning on or after October 1, 2014, for payments 

for Federally qualified health services furnished by Federally qualified health centers under this title in accordance 

with the prospective payment system developed by the 

Secretary under paragraph (1). 

‘‘(B) PAYMENTS.— ‘‘(i) INITIAL PAYMENTS.—The Secretary shall implement such prospective payment system so that the 

estimated amount of expenditures under this title for 

Federally qualified health services in the first year 

that the prospective payment system is implemented 

is equal to 103 percent of the estimated amount of 

expenditures under this title that would have occurred 

for such services in such year if the system had not 

been implemented. 

‘‘(ii) PAYMENTS IN SUBSEQUENT YEARS.—In the year 

after the first year of implementation of such system, 

and in each subsequent year, the payment rate for 

Federally qualified health services furnished in the 

year shall be equal to the payment rate established 

for such services furnished in the preceding year under 

this subparagraph increased by the percentage increase 

in the MEI (as defined in 1842(i)(3)) for the year 

involved.’’. 

SEC. 5503. DISTRIBUTION OF ADDITIONAL RESIDENCY POSITIONS. 

(a) IN GENERAL.—Section 1886(h) of the Social Security Act 

(42 U.S.C. 1395ww(h)) is amended— 

(1) in paragraph (4)(F)(i), by striking ‘‘paragraph (7)’’ and 

inserting ‘‘paragraphs (7) and (8)’’; 

(2) in paragraph (4)(H)(i), by striking ‘‘paragraph (7)’’ and 

inserting ‘‘paragraphs (7) and (8)’’; 

(3) in paragraph (7)(E), by inserting ‘‘or paragraph (8)’’ 

before the period at the end; and 

(4) by adding at the end the following new paragraph: 

‘‘(8) DISTRIBUTION OF ADDITIONAL RESIDENCY POSITIONS.— 
H. R. 3590—538 

‘‘(A) REDUCTIONS IN LIMIT BASED ON UNUSED POSITIONS.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), if a hospital’s reference resident level (as defined 

in subparagraph (H)(i)) is less than the otherwise 

applicable resident limit (as defined in subparagraph 

(H)(iii)), effective for portions of cost reporting periods 

occurring on or after July 1, 2011, the otherwise 

applicable resident limit shall be reduced by 65 percent 

of the difference between such otherwise applicable 

resident limit and such reference resident level. 

‘‘(ii) EXCEPTIONS.—This subparagraph shall not 

apply to— 

‘‘(I) a hospital located in a rural area (as 

defined in subsection (d)(2)(D)(ii)) with fewer than 

250 acute care inpatient beds; 

‘‘(II) a hospital that was part of a qualifying 

entity which had a voluntary residency reduction 

plan approved under paragraph (6)(B) or under 

the authority of section 402 of Public Law 90– 

248, if the hospital demonstrates to the Secretary 

that it has a specified plan in place for filling 

the unused positions by not later than 2 years 

after the date of enactment of this paragraph; 

or 

‘‘(III) a hospital described in paragraph 

(4)(H)(v). 

‘‘(B) DISTRIBUTION.— 

‘‘(i) IN GENERAL.—The Secretary shall increase the 

otherwise applicable resident limit for each qualifying 

hospital that submits an application under this 

subparagraph by such number as the Secretary may 

approve for portions of cost reporting periods occurring 

on or after July 1, 2011. The aggregate number of 

increases in the otherwise applicable resident limit 

under this subparagraph shall be equal to the aggregate reduction in such limits attributable to subparagraph (A) (as estimated by the Secretary). 

‘‘(ii) REQUIREMENTS.—Subject to clause (iii), a hospital that receives an increase in the otherwise 

applicable resident limit under this subparagraph shall 

ensure, during the 5-year period beginning on the date 

of such increase, that— 

‘‘(I) the number of full-time equivalent primary 

care residents, as defined in paragraph (5)(H) (as 

determined by the Secretary), excluding any additional positions under subclause (II), is not less 

than the average number of full-time equivalent 

primary care residents (as so determined) during 

the 3 most recent cost reporting periods ending 

prior to the date of enactment of this paragraph; 

and 

‘‘(II) not less than 75 percent of the positions 

attributable to such increase are in a primary care 

or general surgery residency (as determined by 

the Secretary). 
H. R. 3590—539 

The Secretary may determine whether a hospital has 

met the requirements under this clause during such 

5-year period in such manner and at such time as 

the Secretary determines appropriate, including at the 

end of such 5-year period. 

‘‘(iii) REDISTRIBUTION OF POSITIONS IF HOSPITAL

NO LONGER MEETS CERTAIN REQUIREMENTS.—In the 

case where the Secretary determines that a hospital 

described in clause (ii) does not meet either of the 

requirements under subclause (I) or (II) of such clause, 

the Secretary shall— 

‘‘(I) reduce the otherwise applicable resident 

limit of the hospital by the amount by which such 

limit was increased under this paragraph; and 

‘‘(II) provide for the distribution of positions 

attributable to such reduction in accordance with 

the requirements of this paragraph. 

‘‘(C) CONSIDERATIONS IN REDISTRIBUTION.—In determining for which hospitals the increase in the otherwise 

applicable resident limit is provided under subparagraph 

(B), the Secretary shall take into account— 

‘‘(i) the demonstration likelihood of the hospital 

filling the positions made available under this paragraph within the first 3 cost reporting periods beginning on or after July 1, 2011, as determined by the 

Secretary; and 

‘‘(ii) whether the hospital has an accredited rural 

training track (as described in paragraph (4)(H)(iv)). 

‘‘(D) PRIORITY FOR CERTAIN AREAS.—In determining for 

which hospitals the increase in the otherwise applicable 

resident limit is provided under subparagraph (B), subject 

to subparagraph (E), the Secretary shall distribute the 

increase to hospitals based on the following factors: 

‘‘(i) Whether the hospital is located in a State 

with a resident-to-population ratio in the lowest quartile (as determined by the Secretary). 

‘‘(ii) Whether the hospital is located in a State, 

a territory of the United States, or the District of 

Columbia that is among the top 10 States, territories, 

or Districts in terms of the ratio of— 

‘‘(I) the total population of the State, territory, 

or District living in an area designated (under 

such section 332(a)(1)(A)) as a health professional 

shortage area (as of the date of enactment of this 

paragraph); to 

‘‘(II) the total population of the State, territory, 

or District (as determined by the Secretary based 

on the most recent available population data published by the Bureau of the Census). 

‘‘(iii) Whether the hospital is located in a rural 

area (as defined in subsection (d)(2)(D)(ii)). 

‘‘(E) RESERVATION OF POSITIONS FOR CERTAIN HOSPITALS.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the Secretary shall reserve the positions available for distribution under this paragraph as follows: 
H. R. 3590—540 

‘‘(I) 70 percent of such positions for distribution to hospitals described in clause (i) of subparagraph (D). 

‘‘(II) 30 percent of such positions for distribution to hospitals described in clause (ii) and (iii) 

of such subparagraph. 

‘‘(ii) EXCEPTION IF POSITIONS NOT REDISTRIBUTED

BY JULY 1, 2011.—In the case where the Secretary does 

not distribute positions to hospitals in accordance with 

clause (i) by July 1, 2011, the Secretary shall distribute 

such positions to other hospitals in accordance with 

the considerations described in subparagraph (C) and 

the priority described in subparagraph (D). 

‘‘(F) LIMITATION.—A hospital may not receive more 

than 75 full-time equivalent additional residency positions 

under this paragraph. 

‘‘(G) APPLICATION OF PER RESIDENT AMOUNTS FOR PRIMARY CARE AND NONPRIMARY CARE.—With respect to additional residency positions in a hospital attributable to the 

increase provided under this paragraph, the approved FTE 

per resident amounts are deemed to be equal to the hospital 

per resident amounts for primary care and nonprimary 

care computed under paragraph (2)(D) for that hospital. 

‘‘(H) DEFINITIONS.—In this paragraph: 

‘‘(i) REFERENCE RESIDENT LEVEL.—The term ‘reference resident level’ means, with respect to a hospital, 

the highest resident level for any of the 3 most recent 

cost reporting periods (ending before the date of the 

enactment of this paragraph) of the hospital for which 

a cost report has been settled (or, if not, submitted 

(subject to audit)), as determined by the Secretary. 

‘‘(ii) RESIDENT LEVEL.—The term ‘resident level’ 

has the meaning given such term in paragraph 

(7)(C)(i). 

‘‘(iii) OTHERWISE APPLICABLE RESIDENT LIMIT.—The 

term ‘otherwise applicable resident limit’ means, with 

respect to a hospital, the limit otherwise applicable 

under subparagraphs (F)(i) and (H) of paragraph (4) 

on the resident level for the hospital determined without regard to this paragraph but taking into account 

paragraph (7)(A).’’. 

(b) IME.— 

(1) IN GENERAL.—Section 1886(d)(5)(B)(v) of the Social 

Security Act (42 U.S.C. 1395ww(d)(5)(B)(v)), in the second sentence, is amended— 

(A) by striking ‘‘subsection (h)(7)’’ and inserting ‘‘subsections (h)(7) and (h)(8)’’; and 

(B) by striking ‘‘it applies’’ and inserting ‘‘they apply’’. 

(2) CONFORMING AMENDMENT.—Section 1886(d)(5)(B) of the 

Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is amended 

by adding at the end the following clause: 

‘‘(x) For discharges occurring on or after July 1, 2011, 

insofar as an additional payment amount under this subparagraph is attributable to resident positions distributed to a hospital under subsection (h)(8)(B), the indirect teaching adjustment factor shall be computed in the same manner as provided 

under clause (ii) with respect to such resident positions.’’. 
H. R. 3590—541 

(c) CONFORMING AMENDMENT.—Section 422(b)(2) of the Medicare Prescription Drug, Improvement, and Modernization Act of 

2003 (Public Law 108–173) is amended by striking ‘‘section 

1886(h)(7)’’ and all that follows and inserting ‘‘paragraphs (7) and 

(8) of subsection (h) of section 1886 of the Social Security Act’’. 

SEC. 5504. COUNTING RESIDENT TIME IN NONPROVIDER SETTINGS. 

(a) GME.—Section 1886(h)(4)(E) of the Social Security Act (42 

U.S.C. 1395ww(h)(4)(E)) is amended— 

(1) by striking ‘‘shall be counted and that all the time’’ 

and inserting ‘‘shall be counted and that— 

‘‘(i) effective for cost reporting periods beginning 

before July 1, 2010, all the time;’’; 

(2) in clause (i), as inserted by paragraph (1), by striking 

the period at the end and inserting ‘‘; and’’; 

(3) by inserting after clause (i), as so inserted, the following 

new clause: 

‘‘(ii) effective for cost reporting periods beginning 

on or after July 1, 2010, all the time so spent by 

a resident shall be counted towards the determination 

of full-time equivalency, without regard to the setting 

in which the activities are performed, if a hospital 

incurs the costs of the stipends and fringe benefits 

of the resident during the time the resident spends 

in that setting. If more than one hospital incurs these 

costs, either directly or through a third party, such 

hospitals shall count a proportional share of the time, 

as determined by written agreement between the hospitals, that a resident spends training in that setting.’’; 

and 

(4) by adding at the end the following flush sentence: 

‘‘Any hospital claiming under this subparagraph for time 

spent in a nonprovider setting shall maintain and make 

available to the Secretary records regarding the amount 

of such time and such amount in comparison with amounts 

of such time in such base year as the Secretary shall 

specify.’’. 

(b) IME.—Section 1886(d)(5)(B)(iv) of the Social Security Act 

(42 U.S.C. 1395ww(d)(5)) is amended— 

(1) by striking ‘‘(iv) Effective for discharges occurring on 

or after October 1, 1997’’ and inserting ‘‘(iv)(I) Effective for 

discharges occurring on or after October 1, 1997, and before 

July 1, 2010’’; and 

(2) by inserting after clause (I), as inserted by paragraph 

(1), the following new subparagraph: 

‘‘(II) Effective for discharges occurring on or after July 

1, 2010, all the time spent by an intern or resident in patient 

care activities in a nonprovider setting shall be counted towards 

the determination of full-time equivalency if a hospital incurs 

the costs of the stipends and fringe benefits of the intern 

or resident during the time the intern or resident spends in 

that setting. If more than one hospital incurs these costs, 

either directly or through a third party, such hospitals shall 

count a proportional share of the time, as determined by written 

agreement between the hospitals, that a resident spends 

training in that setting.’’. 
H. R. 3590—542 

(c) APPLICATION.—The amendments made by this section shall 

not be applied in a manner that requires reopening of any settled 

hospital cost reports as to which there is not a jurisdictionally 

proper appeal pending as of the date of the enactment of this 

Act on the issue of payment for indirect costs of medical education 

under section 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 

1395ww(d)(5)(B)) or for direct graduate medical education costs 

under section 1886(h) of such Act (42 U.S.C. 1395ww(h)). 

SEC. 5505. RULES FOR COUNTING RESIDENT TIME FOR DIDACTIC AND 

SCHOLARLY ACTIVITIES AND OTHER ACTIVITIES. 

(a) GME.—Section 1886(h) of the Social Security Act (42 U.S.C. 

1395ww(h)), as amended by section 5504, is amended— 

(1) in paragraph (4)— 

(A) in subparagraph (E), by striking ‘‘Such rules’’ and 

inserting ‘‘Subject to subparagraphs (J) and (K), such 

rules’’; and 

(B) by adding at the end the following new subparagraphs: 

‘‘(J) TREATMENT OF CERTAIN NONPROVIDER AND

DIDACTIC ACTIVITIES.—Such rules shall provide that all time 

spent by an intern or resident in an approved medical 

residency training program in a nonprovider setting that 

is primarily engaged in furnishing patient care (as defined 

in paragraph (5)(K)) in non-patient care activities, such 

as didactic conferences and seminars, but not including 

research not associated with the treatment or diagnosis 

of a particular patient, as such time and activities are 

defined by the Secretary, shall be counted toward the determination of full-time equivalency. 

‘‘(K) TREATMENT OF CERTAIN OTHER ACTIVITIES.—In 

determining the hospital’s number of full-time equivalent 

residents for purposes of this subsection, all the time that 

is spent by an intern or resident in an approved medical 

residency training program on vacation, sick leave, or other 

approved leave, as such time is defined by the Secretary, 

and that does not prolong the total time the resident is 

participating in the approved program beyond the normal 

duration of the program shall be counted toward the determination of full-time equivalency.’’; and 

(2) in paragraph (5), by adding at the end the following 

new subparagraph: 

‘‘(K) NONPROVIDER SETTING THAT IS PRIMARILY

ENGAGED IN FURNISHING PATIENT CARE.—The term ‘nonprovider setting that is primarily engaged in furnishing patient 

care’ means a nonprovider setting in which the primary 

activity is the care and treatment of patients, as defined 

by the Secretary.’’. 

(b) IME DETERMINATIONS.—Section 1886(d)(5)(B) of such Act 

(42 U.S.C. 1395ww(d)(5)(B)) is amended by adding at the end the 

following new clause: 

‘‘(x)(I) The provisions of subparagraph (K) of subsection (h)(4) shall apply under this subparagraph in 

the same manner as they apply under such subsection. 

‘‘(II) In determining the hospital’s number of fulltime equivalent residents for purposes of this subparagraph, all the time spent by an intern or resident 
H. R. 3590—543 

in an approved medical residency training program 

in non-patient care activities, such as didactic conferences and seminars, as such time and activities 

are defined by the Secretary, that occurs in the hospital 

shall be counted toward the determination of full-time 

equivalency if the hospital— 

‘‘(aa) is recognized as a subsection (d) hospital; 

‘‘(bb) is recognized as a subsection (d) Puerto 

Rico hospital; 

‘‘(cc) is reimbursed under a reimbursement 

system authorized under section 1814(b)(3); or 

‘‘(dd) is a provider-based hospital outpatient 

department. 

‘‘(III) In determining the hospital’s number of fulltime equivalent residents for purposes of this subparagraph, all the time spent by an intern or resident 

in an approved medical residency training program 

in research activities that are not associated with the 

treatment or diagnosis of a particular patient, as such 

time and activities are defined by the Secretary, shall 

not be counted toward the determination of full-time 

equivalency.’’. 

(c) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as otherwise provided, the Secretary of Health and Human Services shall implement the 

amendments made by this section in a manner so as to apply 

to cost reporting periods beginning on or after January 1, 

1983. 

(2) GME.—Section 1886(h)(4)(J) of the Social Security Act, 

as added by subsection (a)(1)(B), shall apply to cost reporting 

periods beginning on or after July 1, 2009. 

(3) IME.—Section 1886(d)(5)(B)(x)(III) of the Social Security 

Act, as added by subsection (b), shall apply to cost reporting 

periods beginning on or after October 1, 2001. Such section, 

as so added, shall not give rise to any inference as to how 

the law in effect prior to such date should be interpreted. 

SEC. 5506. PRESERVATION OF RESIDENT CAP POSITIONS FROM 

CLOSED HOSPITALS. 

(a) GME.—Section 1886(h)(4)(H) of the Social Security Act (42 

U.S.C. Section 1395ww(h)(4)(H)) is amended by adding at the end 

the following new clause: 

‘‘(vi) REDISTRIBUTION OF RESIDENCY SLOTS AFTER

A HOSPITAL CLOSES.— 

‘‘(I) IN GENERAL.—Subject to the succeeding 

provisions of this clause, the Secretary shall, by 

regulation, establish a process under which, in 

the case where a hospital (other than a hospital 

described in clause (v)) with an approved medical 

residency program closes on or after a date that 

is 2 years before the date of enactment of this 

clause, the Secretary shall increase the otherwise 

applicable resident limit under this paragraph for 

other hospitals in accordance with this clause. 

‘‘(II) PRIORITY FOR HOSPITALS IN CERTAIN

AREAS.—Subject to the succeeding provisions of 

this clause, in determining for which hospitals the 
H. R. 3590—544 

increase in the otherwise applicable resident limit 

is provided under such process, the Secretary shall 

distribute the increase to hospitals in the following 

priority order (with preference given within each 

category to hospitals that are members of the same 

affiliated group (as defined by the Secretary under 

clause (ii)) as the closed hospital): 

‘‘(aa) First, to hospitals located in the 

same core-based statistical area as, or a corebased statistical area contiguous to, the hospital that closed. 

‘‘(bb) Second, to hospitals located in the 

same State as the hospital that closed. 

‘‘(cc) Third, to hospitals located in the 

same region of the country as the hospital 

that closed. 

‘‘(dd) Fourth, only if the Secretary is not 

able to distribute the increase to hospitals 

described in item (cc), to qualifying hospitals 

in accordance with the provisions of paragraph 

(8). 

‘‘(III) REQUIREMENT HOSPITAL LIKELY TO FILL

POSITION WITHIN CERTAIN TIME PERIOD.—The Secretary may only increase the otherwise applicable 

resident limit of a hospital under such process 

if the Secretary determines the hospital has demonstrated a likelihood of filling the positions made 

available under this clause within 3 years. 

‘‘(IV) LIMITATION.—The aggregate number of 

increases in the otherwise applicable resident 

limits for hospitals under this clause shall be equal 

to the number of resident positions in the approved 

medical residency programs that closed on or after 

the date described in subclause (I). 

‘‘(V) ADMINISTRATION.—Chapter 35 of title 44, 

United States Code, shall not apply to the 

implementation of this clause.’’. 

(b) IME.—Section 1886(d)(5)(B)(v) of the Social Security Act 

(42 U.S.C. 1395ww(d)(5)(B)(v)), in the second sentence, as amended 

by section 5503, is amended by striking ‘‘subsections (h)(7) and 

(h)(8)’’ and inserting ‘‘subsections (h)(4)(H)(vi), (h)(7), and (h)(8)’’. 

(c) APPLICATION.—The amendments made by this section shall 

not be applied in a manner that requires reopening of any settled 

hospital cost reports as to which there is not a jurisdictionally 

proper appeal pending as of the date of the enactment of this 

Act on the issue of payment for indirect costs of medical education 

under section 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 

1395ww(d)(5)(B)) or for direct graduate medical education costs 

under section 1886(h) of such Act (42 U.S.C. Section 1395ww(h)). 

(d) EFFECT ON TEMPORARY FTE CAP ADJUSTMENTS.—The Secretary of Health and Human Services shall give consideration to 

the effect of the amendments made by this section on any temporary 

adjustment to a hospital’s FTE cap under section 413.79(h) of 

title 42, Code of Federal Regulations (as in effect on the date 

of enactment of this Act) in order to ensure that there is no 

duplication of FTE slots. Such amendments shall not affect the 
H. R. 3590—545 

application of section 1886(h)(4)(H)(v) of the Social Security Act 

(42 U.S.C. 1395ww(h)(4)(H)(v)). 

(e) CONFORMING AMENDMENT.—Section 1886(h)(7)(E) of the 

Social Security Act (42 U.S.C. 1395ww(h)(7)(E)), as amended by 

section 5503(a), is amended by striking ‘‘paragraph or paragraph 

(8)’’ and inserting ‘‘this paragraph, paragraph (8), or paragraph 

(4)(H)(vi)’’. 

SEC. 5507. DEMONSTRATION PROJECTS TO ADDRESS HEALTH PROFESSIONS WORKFORCE NEEDS; EXTENSION OF FAMILY-TOFAMILY HEALTH INFORMATION CENTERS. 

(a) AUTHORITY TO CONDUCT DEMONSTRATION PROJECTS.—Title 

XX of the Social Security Act (42 U.S.C. 1397 et seq.) is amended 

by adding at the end the following: 

‘‘SEC. 2008. DEMONSTRATION PROJECTS TO ADDRESS HEALTH 

PROFESSIONS WORKFORCE NEEDS. 

‘‘(a) DEMONSTRATION PROJECTS TO PROVIDE LOW-INCOME

INDIVIDUALS WITH OPPORTUNITIES FOR EDUCATION, TRAINING, AND

CAREER ADVANCEMENT TO ADDRESS HEALTH PROFESSIONS

WORKFORCE NEEDS.— ‘‘(1) AUTHORITY TO AWARD GRANTS.—The Secretary, in consultation with the Secretary of Labor, shall award grants to 

eligible entities to conduct demonstration projects that are 

designed to provide eligible individuals with the opportunity 

to obtain education and training for occupations in the health 

care field that pay well and are expected to either experience 

labor shortages or be in high demand. 

‘‘(2) REQUIREMENTS.— ‘‘(A) AID AND SUPPORTIVE SERVICES.— ‘‘(i) IN GENERAL.—A demonstration project conducted by an eligible entity awarded a grant under 

this section shall, if appropriate, provide eligible 

individuals participating in the project with financial 

aid, child care, case management, and other supportive 

services. 

‘‘(ii) TREATMENT.—Any aid, services, or incentives 

provided to an eligible beneficiary participating in a 

demonstration project under this section shall not be 

considered income, and shall not be taken into account 

for purposes of determining the individual’s eligibility 

for, or amount of, benefits under any means-tested 

program. 

‘‘(B) CONSULTATION AND COORDINATION.—An eligible 

entity applying for a grant to carry out a demonstration 

project under this section shall demonstrate in the application that the entity has consulted with the State agency 

responsible for administering the State TANF program, 

the local workforce investment board in the area in which 

the project is to be conducted (unless the applicant is 

such board), the State workforce investment board established under section 111 of the Workforce Investment Act 

of 1998, and the State Apprenticeship Agency recognized 

under the Act of August 16, 1937 (commonly known as 

the ‘National Apprenticeship Act’) (or if no agency has 

been recognized in the State, the Office of Apprenticeship 

of the Department of Labor) and that the project will 

be carried out in coordination with such entities. 
H. R. 3590—546 

‘‘(C) ASSURANCE OF OPPORTUNITIES FOR INDIAN POPULATIONS.—The Secretary shall award at least 3 grants 

under this subsection to an eligible entity that is an Indian 

tribe, tribal organization, or Tribal College or University. 

‘‘(3) REPORTS AND EVALUATION.— 

‘‘(A) ELIGIBLE ENTITIES.—An eligible entity awarded 

a grant to conduct a demonstration project under this subsection shall submit interim reports to the Secretary on 

the activities carried out under the project and a final 

report on such activities upon the conclusion of the entities’ 

participation in the project. Such reports shall include 

assessments of the effectiveness of such activities with 

respect to improving outcomes for the eligible individuals 

participating in the project and with respect to addressing 

health professions workforce needs in the areas in which 

the project is conducted. 

‘‘(B) EVALUATION.—The Secretary shall, by grant, contract, or interagency agreement, evaluate the demonstration projects conducted under this subsection. Such evaluation shall include identification of successful activities for 

creating opportunities for developing and sustaining, 

particularly with respect to low-income individuals and 

other entry-level workers, a health professions workforce 

that has accessible entry points, that meets high standards 

for education, training, certification, and professional 

development, and that provides increased wages and affordable benefits, including health care coverage, that are 

responsive to the workforce’s needs. 

‘‘(C) REPORT TO CONGRESS.—The Secretary shall submit 

interim reports and, based on the evaluation conducted 

under subparagraph (B), a final report to Congress on 

the demonstration projects conducted under this subsection. 

‘‘(4) DEFINITIONS.—In this subsection: 

‘‘(A) ELIGIBLE ENTITY.—The term ‘eligible entity’ means 

a State, an Indian tribe or tribal organization, an institution of higher education, a local workforce investment board 

established under section 117 of the Workforce Investment 

Act of 1998, a sponsor of an apprenticeship program registered under the National Apprenticeship Act or a community-based organization. 

‘‘(B) ELIGIBLE INDIVIDUAL.— 

‘‘(i) IN GENERAL.—The term ‘eligible individual’ 

means a individual receiving assistance under the 

State TANF program. 

‘‘(ii) OTHER LOW-INCOME INDIVIDUALS.—Such term 

may include other low-income individuals described 

by the eligible entity in its application for a grant 

under this section. 

‘‘(C) INDIAN TRIBE; TRIBAL ORGANIZATION.—The terms 

‘Indian tribe’ and ‘tribal organization’ have the meaning 

given such terms in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b). 

‘‘(D) INSTITUTION OF HIGHER EDUCATION.—The term 

‘institution of higher education’ has the meaning given 

that term in section 101 of the Higher Education Act of 

1965 (20 U.S.C. 1001). 
H. R. 3590—547 

‘‘(E) STATE.—The term ‘State’ means each of the 50 

States, the District of Columbia, the Commonwealth of 

Puerto Rico, the United States Virgin Islands, Guam, and 

American Samoa. 

‘‘(F) STATE TANF PROGRAM.—The term ‘State TANF 

program’ means the temporary assistance for needy families program funded under part A of title IV. 

‘‘(G) TRIBAL COLLEGE OR UNIVERSITY.—The term ‘Tribal 

College or University’ has the meaning given that term 

in section 316(b) of the Higher Education Act of 1965 

(20 U.S.C. 1059c(b)). 

‘‘(b) DEMONSTRATION PROJECT TO DEVELOP TRAINING AND CERTIFICATION PROGRAMS FOR PERSONAL OR HOME CARE AIDES.— 

‘‘(1) AUTHORITY TO AWARD GRANTS.—Not later than 18 

months after the date of enactment of this section, the Secretary 

shall award grants to eligible entities that are States to conduct 

demonstration projects for purposes of developing core training 

competencies and certification programs for personal or home 

care aides. The Secretary shall— 

‘‘(A) evaluate the efficacy of the core training competencies described in paragraph (3)(A) for newly hired 

personal or home care aides and the methods used by 

States to implement such core training competencies in 

accordance with the issues specified in paragraph (3)(B); 

and 

‘‘(B) ensure that the number of hours of training provided by States under the demonstration project with 

respect to such core training competencies are not less 

than the number of hours of training required under any 

applicable State or Federal law or regulation. 

‘‘(2) DURATION.—A demonstration project shall be conducted under this subsection for not less than 3 years. 

‘‘(3) CORE TRAINING COMPETENCIES FOR PERSONAL OR HOME

CARE AIDES.— ‘‘(A) IN GENERAL.—The core training competencies for 

personal or home care aides described in this subparagraph 

include competencies with respect to the following areas: 

‘‘(i) The role of the personal or home care aide 

(including differences between a personal or home care 

aide employed by an agency and a personal or home 

care aide employed directly by the health care consumer or an independent provider). 

‘‘(ii) Consumer rights, ethics, and confidentiality 

(including the role of proxy decision-makers in the 

case where a health care consumer has impaired decision-making capacity). 

‘‘(iii) Communication, cultural and linguistic competence and sensitivity, problem solving, behavior 

management, and relationship skills. 

‘‘(iv) Personal care skills. 

‘‘(v) Health care support. 

‘‘(vi) Nutritional support. 

‘‘(vii) Infection control. 

‘‘(viii) Safety and emergency training. 

‘‘(ix) Training specific to an individual consumer’s 

needs (including older individuals, younger individuals 

with disabilities, individuals with developmental 
H. R. 3590—548 

disabilities, individuals with dementia, and individuals 

with mental and behavioral health needs). 

‘‘(x) Self-Care. 

‘‘(B) IMPLEMENTATION.—The implementation issues 

specified in this subparagraph include the following: 

‘‘(i) The length of the training. 

‘‘(ii) The appropriate trainer to student ratio. 

‘‘(iii) The amount of instruction time spent in the 

classroom as compared to on-site in the home or a 

facility. 

‘‘(iv) Trainer qualifications. 

‘‘(v) Content for a ‘hands-on’ and written certification exam. 

‘‘(vi) Continuing education requirements. 

‘‘(4) APPLICATION AND SELECTION CRITERIA.— 

‘‘(A) IN GENERAL.— 

‘‘(i) NUMBER OF STATES.—The Secretary shall enter 

into agreements with not more than 6 States to conduct 

demonstration projects under this subsection. 

‘‘(ii) REQUIREMENTS FOR STATES.—An agreement 

entered into under clause (i) shall require that a 

participating State— 

‘‘(I) implement the core training competencies 

described in paragraph (3)(A); and 

‘‘(II) develop written materials and protocols 

for such core training competencies, including the 

development of a certification test for personal or 

home care aides who have completed such training 

competencies. 

‘‘(iii) CONSULTATION AND COLLABORATION WITH

COMMUNITY AND VOCATIONAL COLLEGES.—The Secretary shall encourage participating States to consult 

with community and vocational colleges regarding the 

development of curricula to implement the project with 

respect to activities, as applicable, which may include 

consideration of such colleges as partners in such 

implementation. 

‘‘(B) APPLICATION AND ELIGIBILITY.—A State seeking 

to participate in the project shall— 

‘‘(i) submit an application to the Secretary containing such information and at such time as the Secretary may specify; 

‘‘(ii) meet the selection criteria established under 

subparagraph (C); and 

‘‘(iii) meet such additional criteria as the Secretary 

may specify. 

‘‘(C) SELECTION CRITERIA.—In selecting States to 

participate in the program, the Secretary shall establish 

criteria to ensure (if applicable with respect to the activities 

involved)— 

‘‘(i) geographic and demographic diversity; 

‘‘(ii) that participating States offer medical assistance for personal care services under the State Medicaid plan; 

‘‘(iii) that the existing training standards for personal or home care aides in each participating State— 
H. R. 3590—549 

‘‘(I) are different from such standards in the 

other participating States; and 

‘‘(II) are different from the core training competencies described in paragraph (3)(A); 

‘‘(iv) that participating States do not reduce the 

number of hours of training required under applicable 

State law or regulation after being selected to participate in the project; and 

‘‘(v) that participating States recruit a minimum 

number of eligible health and long-term care providers 

to participate in the project. 

‘‘(D) TECHNICAL ASSISTANCE.—The Secretary shall provide technical assistance to States in developing written 

materials and protocols for such core training competencies. 

‘‘(5) EVALUATION AND REPORT.— 

‘‘(A) EVALUATION.—The Secretary shall develop an 

experimental or control group testing protocol in consultation with an independent evaluation contractor selected 

by the Secretary. Such contractor shall evaluate— 

‘‘(i) the impact of core training competencies 

described in paragraph (3)(A), including curricula 

developed to implement such core training competencies, for personal or home care aides within each 

participating State on job satisfaction, mastery of job 

skills, beneficiary and family caregiver satisfaction 

with services, and additional measures determined by 

the Secretary in consultation with the expert panel; 

‘‘(ii) the impact of providing such core training 

competencies on the existing training infrastructure 

and resources of States; and 

‘‘(iii) whether a minimum number of hours of initial training should be required for personal or home 

care aides and, if so, what minimum number of hours 

should be required. 

‘‘(B) REPORTS.— ‘‘(i) REPORT ON INITIAL IMPLEMENTATION.—Not 

later than 2 years after the date of enactment of this 

section, the Secretary shall submit to Congress a report 

on the initial implementation of activities conducted 

under the demonstration project, including any available results of the evaluation conducted under subparagraph (A) with respect to such activities, together with 

such recommendations for legislation or administrative 

action as the Secretary determines appropriate. 

‘‘(ii) FINAL REPORT.—Not later than 1 year after 

the completion of the demonstration project, the Secretary shall submit to Congress a report containing 

the results of the evaluation conducted under subparagraph (A), together with such recommendations for 

legislation or administrative action as the Secretary 

determines appropriate. 

‘‘(6) DEFINITIONS.—In this subsection: 

‘‘(A) ELIGIBLE HEALTH AND LONG-TERM CARE PRO- VIDER.—The term ‘eligible health and long-term care provider’ means a personal or home care agency (including 

personal or home care public authorities), a nursing home, 

a home health agency (as defined in section 1861(o)), or 
H. R. 3590—550 

any other health care provider the Secretary determines 

appropriate which— 

‘‘(i) is licensed or authorized to provide services 

in a participating State; and 

‘‘(ii) receives payment for services under title XIX. 

‘‘(B) PERSONAL CARE SERVICES.—The term ‘personal 

care services’ has the meaning given such term for purposes 

of title XIX. 

‘‘(C) PERSONAL OR HOME CARE AIDE.—The term ‘personal or home care aide’ means an individual who helps 

individuals who are elderly, disabled, ill, or mentally disabled (including an individual with Alzheimer’s disease 

or other dementia) to live in their own home or a residential 

care facility (such as a nursing home, assisted living 

facility, or any other facility the Secretary determines 

appropriate) by providing routine personal care services 

and other appropriate services to the individual. 

‘‘(D) STATE.—The term ‘State’ has the meaning given 

that term for purposes of title XIX. 

‘‘(c) FUNDING.— 

‘‘(1) IN GENERAL.—Subject to paragraph (2), out of any 

funds in the Treasury not otherwise appropriated, there are 

appropriated to the Secretary to carry out subsections (a) and 

(b), $85,000,000 for each of fiscal years 2010 through 2014. 

‘‘(2) TRAINING AND CERTIFICATION PROGRAMS FOR PERSONAL

AND HOME CARE AIDES.—With respect to the demonstration 

projects under subsection (b), the Secretary shall use $5,000,000 

of the amount appropriated under paragraph (1) for each of 

fiscal years 2010 through 2012 to carry out such projects. 

No funds appropriated under paragraph (1) shall be used to 

carry out demonstration projects under subsection (b) after 

fiscal year 2012. 

‘‘(d) NONAPPLICATION.— 

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

the preceding sections of this title shall not apply to grant 

awarded under this section. 

‘‘(2) LIMITATIONS ON USE OF GRANTS.—Section 2005(a) 

(other than paragraph (6)) shall apply to a grant awarded 

under this section to the same extent and in the same manner 

as such section applies to payments to States under this title.’’. 

(b) EXTENSION OF FAMILY-TO-FAMILY HEALTH INFORMATION

CENTERS.—Section 501(c)(1)(A)(iii) of the Social Security Act (42 

U.S.C. 701(c)(1)(A)(iii)) is amended by striking ‘‘fiscal year 2009’’ 

and inserting ‘‘each of fiscal years 2009 through 2012’’. 

SEC. 5508. INCREASING TEACHING CAPACITY. 

(a) TEACHING HEALTH CENTERS TRAINING AND ENHANCEMENT.—Part C of title VII of the Public Health Service Act (42 

U.S.C. 293k et. seq.), as amended by section 5303, is further 

amended by inserting after section 749 the following: 

‘‘SEC. 749A. TEACHING HEALTH CENTERS DEVELOPMENT GRANTS. 

‘‘(a) PROGRAM AUTHORIZED.—The Secretary may award grants 

under this section to teaching health centers for the purpose of 

establishing new accredited or expanded primary care residency 

programs. 
H. R. 3590—551 

‘‘(b) AMOUNT AND DURATION.—Grants awarded under this section shall be for a term of not more than 3 years and the maximum 

award may not be more than $500,000. 

‘‘(c) USE OF FUNDS.—Amounts provided under a grant under 

this section shall be used to cover the costs of— 

‘‘(1) establishing or expanding a primary care residency 

training program described in subsection (a), including costs 

associated with— 

‘‘(A) curriculum development; 

‘‘(B) recruitment, training and retention of residents 

and faculty: 

‘‘(C) accreditation by the Accreditation Council for 

Graduate Medical Education (ACGME), the American 

Dental Association (ADA), or the American Osteopathic 

Association (AOA); and 

‘‘(D) faculty salaries during the development phase; 

and 

‘‘(2) technical assistance provided by an eligible entity. 

‘‘(d) APPLICATION.—A teaching health center seeking a grant 

under this section shall submit an application to the Secretary 

at such time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(e) PREFERENCE FOR CERTAIN APPLICATIONS.—In selecting 

recipients for grants under this section, the Secretary shall give 

preference to any such application that documents an existing affiliation agreement with an area health education center program 

as defined in sections 751 and 799B. 

‘‘(f) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means an 

organization capable of providing technical assistance including 

an area health education center program as defined in sections 

751 and 799B. 

‘‘(2) PRIMARY CARE RESIDENCY PROGRAM.—The term ‘primary care residency program’ means an approved graduate 

medical residency training program (as defined in section 340H) 

in family medicine, internal medicine, pediatrics, internal medicine-pediatrics, obstetrics and gynecology, psychiatry, general 

dentistry, pediatric dentistry, and geriatrics. 

‘‘(3) TEACHING HEALTH CENTER.— 

‘‘(A) IN GENERAL.—The term ‘teaching health center’ 

means an entity that— 

‘‘(i) is a community based, ambulatory patient care 

center; and 

‘‘(ii) operates a primary care residency program. 

‘‘(B) INCLUSION OF CERTAIN ENTITIES.—Such term 

includes the following: 

‘‘(i) A Federally qualified health center (as defined 

in section 1905(l)(2)(B), of the Social Security Act). 

‘‘(ii) A community mental health center (as defined 

in section 1861(ff)(3)(B) of the Social Security Act). 

‘‘(iii) A rural health clinic, as defined in section 

1861(aa) of the Social Security Act. 

‘‘(iv) A health center operated by the Indian Health 

Service, an Indian tribe or tribal organization, or an 

urban Indian organization (as defined in section 4 of 

the Indian Health Care Improvement Act). 
H. R. 3590—552 

‘‘(v) An entity receiving funds under title X of 

the Public Health Service Act. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated, $25,000,000 for fiscal year 2010, $50,000,000 

for fiscal year 2011, $50,000,000 for fiscal year 2012, and such 

sums as may be necessary for each fiscal year thereafter to carry 

out this section. Not to exceed $5,000,000 annually may be used 

for technical assistance program grants.’’. 

(b) NATIONAL HEALTH SERVICE CORPS TEACHING CAPACITY.— Section 338C(a) of the Public Health Service Act (42 U.S.C. 254m(a)) 

is amended to read as follows: 

‘‘(a) SERVICE IN FULL-TIME CLINICAL PRACTICE.—Except as provided in section 338D, each individual who has entered into a 

written contract with the Secretary under section 338A or 338B 

shall provide service in the full-time clinical practice of such individual’s profession as a member of the Corps for the period of obligated 

service provided in such contract. For the purpose of calculating 

time spent in full-time clinical practice under this subsection, up 

to 50 percent of time spent teaching by a member of the Corps 

may be counted toward his or her service obligation.’’. 

(c) PAYMENTS TO QUALIFIED TEACHING HEALTH CENTERS.—Part 

D of title III of the Public Health Service Act (42 U.S.C. 254b 

et seq.) is amended by adding at the end the following: 

‘‘Subpart XI—Support of Graduate Medical 

Education in Qualified Teaching Health Centers 

‘‘SEC. 340H. PROGRAM OF PAYMENTS TO TEACHING HEALTH CENTERS 

THAT OPERATE GRADUATE MEDICAL EDUCATION PROGRAMS. 

‘‘(a) PAYMENTS.—Subject to subsection (h)(2), the Secretary 

shall make payments under this section for direct expenses and 

for indirect expenses to qualified teaching health centers that are 

listed as sponsoring institutions by the relevant accrediting body 

for expansion of existing or establishment of new approved graduate 

medical residency training programs. 

‘‘(b) AMOUNT OF PAYMENTS.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the amounts 

payable under this section to qualified teaching health centers 

for an approved graduate medical residency training program 

for a fiscal year are each of the following amounts: 

‘‘(A) DIRECT EXPENSE AMOUNT.—The amount determined under subsection (c) for direct expenses associated 

with sponsoring approved graduate medical residency 

training programs. 

‘‘(B) INDIRECT EXPENSE AMOUNT.—The amount determined under subsection (d) for indirect expenses associated 

with the additional costs relating to teaching residents 

in such programs. 

‘‘(2) CAPPED AMOUNT.— 

‘‘(A) IN GENERAL.—The total of the payments made 

to qualified teaching health centers under paragraph (1)(A) 

or paragraph (1)(B) in a fiscal year shall not exceed the 

amount of funds appropriated under subsection (g) for such 

payments for that fiscal year. 

‘‘(B) LIMITATION.—The Secretary shall limit the 

funding of full-time equivalent residents in order to ensure 
H. R. 3590—553 

the direct and indirect payments as determined under subsection (c) and (d) do not exceed the total amount of funds 

appropriated in a fiscal year under subsection (g). 

‘‘(c) AMOUNT OF PAYMENT FOR DIRECT GRADUATE MEDICAL EDUCATION.— 

‘‘(1) IN GENERAL.—The amount determined under this subsection for payments to qualified teaching health centers for 

direct graduate expenses relating to approved graduate medical 

residency training programs for a fiscal year is equal to the 

product of— 

‘‘(A) the updated national per resident amount for 

direct graduate medical education, as determined under 

paragraph (2); and 

‘‘(B) the average number of full-time equivalent residents in the teaching health center’s graduate approved 

medical residency training programs as determined under 

section 1886(h)(4) of the Social Security Act (without regard 

to the limitation under subparagraph (F) of such section) 

during the fiscal year. 

‘‘(2) UPDATED NATIONAL PER RESIDENT AMOUNT FOR DIRECT

GRADUATE MEDICAL EDUCATION.—The updated per resident 

amount for direct graduate medical education for a qualified 

teaching health center for a fiscal year is an amount determined 

as follows: 

‘‘(A) DETERMINATION OF QUALIFIED TEACHING HEALTH

CENTER PER RESIDENT AMOUNT.—The Secretary shall compute for each individual qualified teaching health center 

a per resident amount— 

‘‘(i) by dividing the national average per resident 

amount computed under section 340E(c)(2)(D) into a 

wage-related portion and a non-wage related portion 

by applying the proportion determined under subparagraph (B); 

‘‘(ii) by multiplying the wage-related portion by 

the factor applied under section 1886(d)(3)(E) of the 

Social Security Act (but without application of section 

4410 of the Balanced Budget Act of 1997 (42 U.S.C. 

1395ww note)) during the preceding fiscal year for 

the teaching health center’s area; and 

‘‘(iii) by adding the non-wage-related portion to 

the amount computed under clause (ii). 

‘‘(B) UPDATING RATE.—The Secretary shall update such 

per resident amount for each such qualified teaching health 

center as determined appropriate by the Secretary. 

‘‘(d) AMOUNT OF PAYMENT FOR INDIRECT MEDICAL EDUCATION.— 

‘‘(1) IN GENERAL.—The amount determined under this subsection for payments to qualified teaching health centers for 

indirect expenses associated with the additional costs of 

teaching residents for a fiscal year is equal to an amount 

determined appropriate by the Secretary. 

‘‘(2) FACTORS.—In determining the amount under paragraph (1), the Secretary shall— 

‘‘(A) evaluate indirect training costs relative to supporting a primary care residency program in qualified 

teaching health centers; and 

‘‘(B) based on this evaluation, assure that the aggregate 

of the payments for indirect expenses under this section 
H. R. 3590—554 

and the payments for direct graduate medical education 

as determined under subsection (c) in a fiscal year do 

not exceed the amount appropriated for such expenses as 

determined in subsection (g). 

‘‘(3) INTERIM PAYMENT.—Before the Secretary makes a payment under this subsection pursuant to a determination of 

indirect expenses under paragraph (1), the Secretary may provide to qualified teaching health centers a payment, in addition 

to any payment made under subsection (c), for expected indirect 

expenses associated with the additional costs of teaching residents for a fiscal year, based on an estimate by the Secretary. 

‘‘(e) CLARIFICATION REGARDING RELATIONSHIP TO OTHER PAYMENTS FOR GRADUATE MEDICAL EDUCATION.—Payments under this 

section— 

‘‘(1) shall be in addition to any payments— 

‘‘(A) for the indirect costs of medical education under 

section 1886(d)(5)(B) of the Social Security Act; 

‘‘(B) for direct graduate medical education costs under 

section 1886(h) of such Act; and 

‘‘(C) for direct costs of medical education under section 

1886(k) of such Act; 

‘‘(2) shall not be taken into account in applying the limitation on the number of total full-time equivalent residents under 

subparagraphs (F) and (G) of section 1886(h)(4) of such Act 

and clauses (v), (vi)(I), and (vi)(II) of section 1886(d)(5)(B) of 

such Act for the portion of time that a resident rotates to 

a hospital; and 

‘‘(3) shall not include the time in which a resident is 

counted toward full-time equivalency by a hospital under paragraph (2) or under section 1886(d)(5)(B)(iv) of the Social Security Act, section 1886(h)(4)(E) of such Act, or section 340E 

of this Act. 

‘‘(f) RECONCILIATION.—The Secretary shall determine any 

changes to the number of residents reported by a hospital in the 

application of the hospital for the current fiscal year to determine 

the final amount payable to the hospital for the current fiscal 

year for both direct expense and indirect expense amounts. Based 

on such determination, the Secretary shall recoup any overpayments 

made to pay any balance due to the extent possible. The final 

amount so determined shall be considered a final intermediary 

determination for the purposes of section 1878 of the Social Security 

Act and shall be subject to administrative and judicial review under 

that section in the same manner as the amount of payment under 

section 1186(d) of such Act is subject to review under such section. 

‘‘(g) FUNDING.—To carry out this section, there are appropriated 

such sums as may be necessary, not to exceed $230,000,000, for 

the period of fiscal years 2011 through 2015. 

‘‘(h) ANNUAL REPORTING REQUIRED.— 

‘‘(1) ANNUAL REPORT.—The report required under this paragraph for a qualified teaching health center for a fiscal year 

is a report that includes (in a form and manner specified 

by the Secretary) the following information for the residency 

academic year completed immediately prior to such fiscal year: 

‘‘(A) The types of primary care resident approved 

training programs that the qualified teaching health center 

provided for residents. 
H. R. 3590—555 

‘‘(B) The number of approved training positions for 

residents described in paragraph (4). 

‘‘(C) The number of residents described in paragraph 

(4) who completed their residency training at the end of 

such residency academic year and care for vulnerable populations living in underserved areas. 

‘‘(D) Other information as deemed appropriate by the 

Secretary. 

‘‘(2) AUDIT AUTHORITY; LIMITATION ON PAYMENT.— 

‘‘(A) AUDIT AUTHORITY.—The Secretary may audit a 

qualified teaching health center to ensure the accuracy 

and completeness of the information submitted in a report 

under paragraph (1). 

‘‘(B) LIMITATION ON PAYMENT.—A teaching health 

center may only receive payment in a cost reporting period 

for a number of such resident positions that is greater 

than the base level of primary care resident positions, 

as determined by the Secretary. For purposes of this 

subparagraph, the ‘base level of primary care residents’ 

for a teaching health center is the level of such residents 

as of a base period. 

‘‘(3) REDUCTION IN PAYMENT FOR FAILURE TO REPORT.— 

‘‘(A) IN GENERAL.—The amount payable under this section to a qualified teaching health center for a fiscal year 

shall be reduced by at least 25 percent if the Secretary 

determines that— 

‘‘(i) the qualified teaching health center has failed 

to provide the Secretary, as an addendum to the qualified teaching health center’s application under this 

section for such fiscal year, the report required under 

paragraph (1) for the previous fiscal year; or 

‘‘(ii) such report fails to provide complete and 

accurate information required under any subparagraph 

of such paragraph. 

‘‘(B) NOTICE AND OPPORTUNITY TO PROVIDE ACCURATE

AND MISSING INFORMATION.—Before imposing a reduction 

under subparagraph (A) on the basis of a qualified teaching 

health center’s failure to provide complete and accurate 

information described in subparagraph (A)(ii), the Secretary 

shall provide notice to the teaching health center of such 

failure and the Secretary’s intention to impose such reduction and shall provide the teaching health center with 

the opportunity to provide the required information within 

the period of 30 days beginning on the date of such notice. 

If the teaching health center provides such information 

within such period, no reduction shall be made under 

subparagraph (A) on the basis of the previous failure to 

provide such information. 

‘‘(4) RESIDENTS.—The residents described in this paragraph 

are those who are in part-time or full-time equivalent resident 

training positions at a qualified teaching health center in any 

approved graduate medical residency training program. 

‘‘(i) REGULATIONS.—The Secretary shall promulgate regulations 

to carry out this section. 

‘‘(j) DEFINITIONS.—In this section: 

‘‘(1) APPROVED GRADUATE MEDICAL RESIDENCY TRAINING

PROGRAM.—The term ‘approved graduate medical residency 
H. R. 3590—556 

training program’ means a residency or other postgraduate 

medical training program— 

‘‘(A) participation in which may be counted toward 

certification in a specialty or subspecialty and includes 

formal postgraduate training programs in geriatric medicine approved by the Secretary; and 

‘‘(B) that meets criteria for accreditation (as established 

by the Accreditation Council for Graduate Medical Education, the American Osteopathic Association, or the American Dental Association). 

‘‘(2) PRIMARY CARE RESIDENCY PROGRAM.—The term ‘primary care residency program’ has the meaning given that term 

in section 749A. 

‘‘(3) QUALIFIED TEACHING HEALTH CENTER.—The term 

‘qualified teaching health center’ has the meaning given the 

term ‘teaching health center’ in section 749A.’’. 

SEC. 5509. GRADUATE NURSE EDUCATION DEMONSTRATION. 

(a) IN GENERAL.— 

(1) ESTABLISHMENT.— 

(A) IN GENERAL.—The Secretary shall establish a graduate nurse education demonstration under title XVIII of 

the Social Security Act (42 U.S.C. 1395 et seq.) under 

which an eligible hospital may receive payment for the 

hospital’s reasonable costs (described in paragraph (2)) for 

the provision of qualified clinical training to advance practice nurses. 

(B) NUMBER.—The demonstration shall include up to 

5 eligible hospitals. 

(C) WRITTEN AGREEMENTS.—Eligible hospitals selected 

to participate in the demonstration shall enter into written 

agreements pursuant to subsection (b) in order to reimburse 

the eligible partners of the hospital the share of the costs 

attributable to each partner. 

(2) COSTS DESCRIBED.— 

(A) IN GENERAL.—Subject to subparagraph (B) and subsection (d), the costs described in this paragraph are the 

reasonable costs (as described in section 1861(v) of the 

Social Security Act (42 U.S.C. 1395x(v))) of each eligible 

hospital for the clinical training costs (as determined by 

the Secretary) that are attributable to providing advanced 

practice registered nurses with qualified training. 

(B) LIMITATION.—With respect to a year, the amount 

reimbursed under subparagraph (A) may not exceed the 

amount of costs described in subparagraph (A) that are 

attributable to an increase in the number of advanced 

practice registered nurses enrolled in a program that provides qualified training during the year and for which 

the hospital is being reimbursed under the demonstration, 

as compared to the average number of advanced practice 

registered nurses who graduated in each year during the 

period beginning on January 1, 2006, and ending on 

December 31, 2010 (as determined by the Secretary) from 

the graduate nursing education program operated by the 

applicable school of nursing that is an eligible partner 

of the hospital for purposes of the demonstration. 
H. R. 3590—557 

(3) WAIVER AUTHORITY.—The Secretary may waive such 

requirements of titles XI and XVIII of the Social Security 

Act as may be necessary to carry out the demonstration. 

(4) ADMINISTRATION.—Chapter 35 of title 44, United States 

Code, shall not apply to the implementation of this section. 

(b) WRITTEN AGREEMENTS WITH ELIGIBLE PARTNERS.—No payment shall be made under this section to an eligible hospital unless 

such hospital has in effect a written agreement with the eligible 

partners of the hospital. Such written agreement shall describe, 

at a minimum— 

(1) the obligations of the eligible partners with respect 

to the provision of qualified training; and 

(2) the obligation of the eligible hospital to reimburse such 

eligible partners applicable (in a timely manner) for the costs 

of such qualified training attributable to partner. 

(c) EVALUATION.—Not later than October 17, 2017, the Secretary shall submit to Congress a report on the demonstration. 

Such report shall include an analysis of the following: 

(1) The growth in the number of advanced practice registered nurses with respect to a specific base year as a result 

of the demonstration. 

(2) The growth for each of the specialties described in 

subparagraphs (A) through (D) of subsection (e)(1). 

(3) The costs to the Medicare program under title XVIII 

of the Social Security Act as a result of the demonstration. 

(4) Other items the Secretary determines appropriate and 

relevant. 

(d) FUNDING.— (1) IN GENERAL.—There is hereby appropriated to the Secretary, out of any funds in the Treasury not otherwise appropriated, $50,000,000 for each of fiscal years 2012 through 2015 

to carry out this section, including the design, implementation, 

monitoring, and evaluation of the demonstration. 

(2) PRORATION.—If the aggregate payments to eligible hos- pitals under the demonstration exceed $50,000,000 for a fiscal 

year described in paragraph (1), the Secretary shall prorate 

the payment amounts to each eligible hospital in order to 

ensure that the aggregate payments do not exceed such amount. 

(3) WITHOUT FISCAL YEAR LIMITATION.—Amounts appropriated under this subsection shall remain available without 

fiscal year limitation. 

(e) DEFINITIONS.—In this section: 

(1) ADVANCED PRACTICE REGISTERED NURSE.—The term 

‘‘advanced practice registered nurse’’ includes the following: 

(A) A clinical nurse specialist (as defined in subsection 

(aa)(5) of section 1861 of the Social Security Act (42 U.S.C. 

1395x)). 

(B) A nurse practitioner (as defined in such subsection). 

(C) A certified registered nurse anesthetist (as defined 

in subsection (bb)(2) of such section). 

(D) A certified nurse-midwife (as defined in subsection 

(gg)(2) of such section). 

(2) APPLICABLE NON-HOSPITAL COMMUNITY-BASED CARE SET- TING.—The term ‘‘applicable non-hospital community-based care 

setting’’ means a non-hospital community-based care setting 

which has entered into a written agreement (as described in 

subsection (b)) with the eligible hospital participating in the 
H. R. 3590—558 

demonstration. Such settings include Federally qualified health 

centers, rural health clinics, and other non-hospital settings 

as determined appropriate by the Secretary. 

(3) APPLICABLE SCHOOL OF NURSING.—The term ‘‘applicable 

school of nursing’’ means an accredited school of nursing (as 

defined in section 801 of the Public Health Service Act) which 

has entered into a written agreement (as described in subsection (b)) with the eligible hospital participating in the demonstration. 

(4) DEMONSTRATION.—The term ‘‘demonstration’’ means the 

graduate nurse education demonstration established under subsection (a). 

(5) ELIGIBLE HOSPITAL.—The term ‘‘eligible hospital’’ means 

a hospital (as defined in subsection (e) of section 1861 of the 

Social Security Act (42 U.S.C. 1395x)) or a critical access hospital (as defined in subsection (mm)(1) of such section) that 

has a written agreement in place with— 

(A) 1 or more applicable schools of nursing; and 

(B) 2 or more applicable non-hospital community-based 

care settings. 

(6) ELIGIBLE PARTNERS.—The term ‘‘eligible partners’’ 

includes the following: 

(A) An applicable non-hospital community-based care 

setting. 

(B) An applicable school of nursing. 

(7) QUALIFIED TRAINING.— 

(A) IN GENERAL.—The term ‘‘qualified training’’ means 

training— 

(i) that provides an advanced practice registered 

nurse with the clinical skills necessary to provide primary care, preventive care, transitional care, chronic 

care management, and other services appropriate for 

individuals entitled to, or enrolled for, benefits under 

part A of title XVIII of the Social Security Act, or 

enrolled under part B of such title; and 

(ii) subject to subparagraph (B), at least half of 

which is provided in a non-hospital community-based 

care setting. 

(B) WAIVER OF REQUIREMENT HALF OF TRAINING BE

PROVIDED IN NON-HOSPITAL COMMUNITY-BASED CARE SETTING IN CERTAIN AREAS.—The Secretary may waive the 

requirement under subparagraph (A)(ii) with respect to 

eligible hospitals located in rural or medically underserved 

areas. 

(8) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

Subtitle G—Improving Access to Health 

Care Services 

SEC. 5601. SPENDING FOR FEDERALLY QUALIFIED HEALTH CENTERS 

(FQHCS). 

(a) IN GENERAL.—Section 330(r) of the Public Health Service 

Act (42 U.S.C. 254b(r)) is amended by striking paragraph (1) and 

inserting the following: 
H. R. 3590—559 

‘‘(1) GENERAL AMOUNTS FOR GRANTS.—For the purpose of 

carrying out this section, in addition to the amounts authorized 

to be appropriated under subsection (d), there is authorized 

to be appropriated the following: 

‘‘(A) For fiscal year 2010, $2,988,821,592. 

‘‘(B) For fiscal year 2011, $3,862,107,440. 

‘‘(C) For fiscal year 2012, $4,990,553,440. 

‘‘(D) For fiscal year 2013, $6,448,713,307. 

‘‘(E) For fiscal year 2014, $7,332,924,155. 

‘‘(F) For fiscal year 2015, $8,332,924,155. 

‘‘(G) For fiscal year 2016, and each subsequent fiscal 

year, the amount appropriated for the preceding fiscal year 

adjusted by the product of— 

‘‘(i) one plus the average percentage increase in 

costs incurred per patient served; and 

‘‘(ii) one plus the average percentage increase in 

the total number of patients served.’’. 

(b) RULE OF CONSTRUCTION.—Section 330(r) of the Public 

Health Service Act (42 U.S.C. 254b(r)) is amended by adding at 

the end the following: 

‘‘(4) RULE OF CONSTRUCTION WITH RESPECT TO RURAL

HEALTH CLINICS.— 

‘‘(A) IN GENERAL.—Nothing in this section shall be 

construed to prevent a community health center from contracting with a Federally certified rural health clinic (as 

defined in section 1861(aa)(2) of the Social Security Act), 

a low-volume hospital (as defined for purposes of section 

1886 of such Act), a critical access hospital, a sole community hospital (as defined for purposes of section 

1886(d)(5)(D)(iii) of such Act), or a medicare-dependent 

share hospital (as defined for purposes of section 

1886(d)(5)(G)(iv) of such Act) for the delivery of primary 

health care services that are available at the clinic or 

hospital to individuals who would otherwise be eligible 

for free or reduced cost care if that individual were able 

to obtain that care at the community health center. Such 

services may be limited in scope to those primary health 

care services available in that clinic or hospitals. 

‘‘(B) ASSURANCES.—In order for a clinic or hospital 

to receive funds under this section through a contract with 

a community health center under subparagraph (A), such 

clinic or hospital shall establish policies to ensure— 

‘‘(i) nondiscrimination based on the ability of a 

patient to pay; and 

‘‘(ii) the establishment of a sliding fee scale for 

low-income patients.’’. 

SEC. 5602. NEGOTIATED RULEMAKING FOR DEVELOPMENT OF METHODOLOGY AND CRITERIA FOR DESIGNATING MEDICALLY 

UNDERSERVED POPULATIONS AND HEALTH PROFESSIONS SHORTAGE AREAS. 

(a) ESTABLISHMENT.— (1) IN GENERAL.—The Secretary of Health and Human 

Services (in this section referred to as the ‘‘Secretary’’) shall 

establish, through a negotiated rulemaking process under subchapter 3 of chapter 5 of title 5, United States Code, a comprehensive methodology and criteria for designation of— 
H. R. 3590—560 

(A) medically underserved populations in accordance 

with section 330(b)(3) of the Public Health Service Act 

(42 U.S.C. 254b(b)(3)); 

(B) health professions shortage areas under section 

332 of the Public Health Service Act (42 U.S.C. 254e). 

(2) FACTORS TO CONSIDER.—In establishing the methodology and criteria under paragraph (1), the Secretary— 

(A) shall consult with relevant stakeholders who will 

be significantly affected by a rule (such as national, State 

and regional organizations representing affected entities), 

State health offices, community organizations, health centers and other affected entities, and other interested parties; and 

(B) shall take into account— 

(i) the timely availability and appropriateness of 

data used to determine a designation to potential 

applicants for such designations; 

(ii) the impact of the methodology and criteria 

on communities of various types and on health centers 

and other safety net providers; 

(iii) the degree of ease or difficulty that will face 

potential applicants for such designations in securing 

the necessary data; and 

(iv) the extent to which the methodology accurately 

measures various barriers that confront individuals 

and population groups in seeking health care services. 

(b) PUBLICATION OF NOTICE.—In carrying out the rulemaking 

process under this subsection, the Secretary shall publish the notice 

provided for under section 564(a) of title 5, United States Code, 

by not later than 45 days after the date of the enactment of 

this Act. 

(c) TARGET DATE FOR PUBLICATION OF RULE.—As part of the 

notice under subsection (b), and for purposes of this subsection, 

the ‘‘target date for publication’’, as referred to in section 564(a)(5) 

of title 5, United Sates Code, shall be July 1, 2010. 

(d) APPOINTMENT OF NEGOTIATED RULEMAKING COMMITTEE AND

FACILITATOR.—The Secretary shall provide for— 

(1) the appointment of a negotiated rulemaking committee 

under section 565(a) of title 5, United States Code, by not 

later than 30 days after the end of the comment period provided 

for under section 564(c) of such title; and 

(2) the nomination of a facilitator under section 566(c) 

of such title 5 by not later than 10 days after the date of 

appointment of the committee. 

(e) PRELIMINARY COMMITTEE REPORT.—The negotiated rulemaking committee appointed under subsection (d) shall report to 

the Secretary, by not later than April 1, 2010, regarding the committee’s progress on achieving a consensus with regard to the rulemaking proceeding and whether such consensus is likely to occur 

before one month before the target date for publication of the 

rule. If the committee reports that the committee has failed to 

make significant progress toward such consensus or is unlikely 

to reach such consensus by the target date, the Secretary may 

terminate such process and provide for the publication of a rule 

under this section through such other methods as the Secretary 

may provide. 
H. R. 3590—561 

(f) FINAL COMMITTEE REPORT.—If the committee is not terminated under subsection (e), the rulemaking committee shall submit 

a report containing a proposed rule by not later than one month 

before the target publication date. 

(g) INTERIM FINAL EFFECT.—The Secretary shall publish a rule 

under this section in the Federal Register by not later than the 

target publication date. Such rule shall be effective and final immediately on an interim basis, but is subject to change and revision 

after public notice and opportunity for a period (of not less than 

90 days) for public comment. In connection with such rule, the 

Secretary shall specify the process for the timely review and 

approval of applications for such designations pursuant to such 

rules and consistent with this section. 

(h) PUBLICATION OF RULE AFTER PUBLIC COMMENT.—The Secretary shall provide for consideration of such comments and 

republication of such rule by not later than 1 year after the target 

publication date. 

SEC. 5603. REAUTHORIZATION OF THE WAKEFIELD EMERGENCY MEDICAL SERVICES FOR CHILDREN PROGRAM. 

Section 1910 of the Public Health Service Act (42 U.S.C. 300w– 

9) is amended— 

(1) in subsection (a), by striking ‘‘3-year period (with an 

optional 4th year’’ and inserting ‘‘4-year period (with an optional 

5th year’’; and 

(2) in subsection (d)— 

(A) by striking ‘‘and such sums’’ and inserting ‘‘such 

sums’’; and 

(B) by inserting before the period the following: ‘‘, $25,000,000 for fiscal year 2010, $26,250,000 for fiscal year 

2011, $27,562,500 for fiscal year 2012, $28,940,625 for fiscal 

year 2013, and $30,387,656 for fiscal year 2014’’. 

SEC. 5604. CO-LOCATING PRIMARY AND SPECIALTY CARE IN COMMUNITY-BASED MENTAL HEALTH SETTINGS. 

Subpart 3 of part B of title V of the Public Health Service 

Act (42 U.S.C. 290bb–31 et seq.) is amended by adding at the 

end the following: 

‘‘SEC. 520K. AWARDS FOR CO-LOCATING PRIMARY AND SPECIALTY 

CARE IN COMMUNITY-BASED MENTAL HEALTH SETTINGS. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible entity’ means a 

qualified community mental health program defined under section 1913(b)(1). 

‘‘(2) SPECIAL POPULATIONS.—The term ‘special populations’ 

means adults with mental illnesses who have co-occurring primary care conditions and chronic diseases. 

‘‘(b) PROGRAM AUTHORIZED.—The Secretary, acting through the 

Administrator shall award grants and cooperative agreements to 

eligible entities to establish demonstration projects for the provision 

of coordinated and integrated services to special populations 

through the co-location of primary and specialty care services in 

community-based mental and behavioral health settings. 

‘‘(c) APPLICATION.—To be eligible to receive a grant or cooperative agreement under this section, an eligible entity shall submit 

an application to the Administrator at such time, in such manner, 
H. R. 3590—562 

and accompanied by such information as the Administrator may 

require, including a description of partnerships, or other arrangements with local primary care providers, including community 

health centers, to provide services to special populations. 

‘‘(d) USE OF FUNDS.— 

‘‘(1) IN GENERAL.—For the benefit of special populations, 

an eligible entity shall use funds awarded under this section 

for— 

‘‘(A) the provision, by qualified primary care professionals, of on site primary care services; 

‘‘(B) reasonable costs associated with medically necessary referrals to qualified specialty care professionals, 

other coordinators of care or, if permitted by the terms 

of the grant or cooperative agreement, by qualified specialty 

care professionals on a reasonable cost basis on site at 

the eligible entity; 

‘‘(C) information technology required to accommodate 

the clinical needs of primary and specialty care professionals; or 

‘‘(D) facility modifications needed to bring primary and 

specialty care professionals on site at the eligible entity. 

‘‘(2) LIMITATION.—Not to exceed 15 percent of grant or 

cooperative agreement funds may be used for activities 

described in subparagraphs (C) and (D) of paragraph (1). 

‘‘(e) EVALUATION.—Not later than 90 days after a grant or 

cooperative agreement awarded under this section expires, an 

eligible entity shall submit to the Secretary the results of an evaluation to be conducted by the entity concerning the effectiveness 

of the activities carried out under the grant or agreement. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section, $50,000,000 for fiscal 

year 2010 and such sums as may be necessary for each of fiscal 

years 2011 through 2014.’’. 

SEC. 5605. KEY NATIONAL INDICATORS. 

(a) DEFINITIONS.—In this section: 

(1) ACADEMY.—The term ‘‘Academy’’ means the National 

Academy of Sciences. 

(2) COMMISSION.—The term ‘‘Commission’’ means the 

Commission on Key National Indicators established under subsection (b). 

(3) INSTITUTE.—The term ‘‘Institute’’ means a Key National 

Indicators Institute as designated under subsection (c)(3). 

(b) COMMISSION ON KEY NATIONAL INDICATORS.— 

(1) ESTABLISHMENT.—There is established a ‘‘Commission 

on Key National Indicators’’. 

(2) MEMBERSHIP.— 

(A) NUMBER AND APPOINTMENT.—The Commission 

shall be composed of 8 members, to be appointed equally 

by the majority and minority leaders of the Senate and 

the Speaker and minority leader of the House of Representatives. 

(B) PROHIBITED APPOINTMENTS.—Members of the 

Commission shall not include Members of Congress or other 

elected Federal, State, or local government officials. 

(C) QUALIFICATIONS.—In making appointments under 

subparagraph (A), the majority and minority leaders of 
H. R. 3590—563 

the Senate and the Speaker and minority leader of the 

House of Representatives shall appoint individuals who 

have shown a dedication to improving civic dialogue and 

decision-making through the wide use of scientific evidence 

and factual information. 

(D) PERIOD OF APPOINTMENT.—Each member of the 

Commission shall be appointed for a 2-year term, except 

that 1 initial appointment shall be for 3 years. Any vacancies shall not affect the power and duties of the Commission 

but shall be filled in the same manner as the original 

appointment and shall last only for the remainder of that 

term. 

(E) DATE.—Members of the Commission shall be 

appointed by not later than 30 days after the date of 

enactment of this Act. 

(F) INITIAL ORGANIZING PERIOD.—–Not later than 60 

days after the date of enactment of this Act, the Commission shall develop and implement a schedule for completion 

of the review and reports required under subsection (d). 

(G) CO-CHAIRPERSONS.—The Commission shall select 

2 Co-Chairpersons from among its members. 

(c) DUTIES OF THE COMMISSION.— 

(1) IN GENERAL.—The Commission shall— 

(A) conduct comprehensive oversight of a newly established key national indicators system consistent with the 

purpose described in this subsection; 

(B) make recommendations on how to improve the 

key national indicators system; 

(C) coordinate with Federal Government users and 

information providers to assure access to relevant and 

quality data; and 

(D) enter into contracts with the Academy. 

(2) REPORTS.— (A) ANNUAL REPORT TO CONGRESS.—Not later than 1 

year after the selection of the 2 Co-Chairpersons of the 

Commission, and each subsequent year thereafter, the 

Commission shall prepare and submit to the appropriate 

Committees of Congress and the President a report that 

contains a detailed statement of the recommendations, 

findings, and conclusions of the Commission on the activities of the Academy and a designated Institute related 

to the establishment of a Key National Indicator System. 

(B) ANNUAL REPORT TO THE ACADEMY.— 

(i) IN GENERAL.—Not later than 6 months after 

the selection of the 2 Co-Chairpersons of the Commission, and each subsequent year thereafter, the Commission shall prepare and submit to the Academy and 

a designated Institute a report making recommendations concerning potential issue areas and key indicators to be included in the Key National Indicators. 

(ii) LIMITATION.—The Commission shall not have 

the authority to direct the Academy or, if established, 

the Institute, to adopt, modify, or delete any key indicators. 

(3) CONTRACT WITH THE NATIONAL ACADEMY OF SCIENCES.— (A) IN GENERAL.—–As soon as practicable after the 

selection of the 2 Co-Chairpersons of the Commission, the 
H. R. 3590—564 

Co-Chairpersons shall enter into an arrangement with the 

National Academy of Sciences under which the Academy 

shall— 

(i) review available public and private sector 

research on the selection of a set of key national indicators; 

(ii) determine how best to establish a key national 

indicator system for the United States, by either creating its own institutional capability or designating 

an independent private nonprofit organization as an 

Institute to implement a key national indicator system; 

(iii) if the Academy designates an independent 

Institute under clause (ii), provide scientific and technical advice to the Institute and create an appropriate 

governance mechanism that balances Academy involvement and the independence of the Institute; and 

(iv) provide an annual report to the Commission 

addressing scientific and technical issues related to 

the key national indicator system and, if established, 

the Institute, and governance of the Institute’s budget 

and operations. 

(B) PARTICIPATION.—In executing the arrangement 

under subparagraph (A), the National Academy of Sciences 

shall convene a multi-sector, multi-disciplinary process to 

define major scientific and technical issues associated with 

developing, maintaining, and evolving a Key National Indicator System and, if an Institute is established, to provide 

it with scientific and technical advice. 

(C) ESTABLISHMENT OF A KEY NATIONAL INDICATOR

SYSTEM.— 

(i) IN GENERAL.—In executing the arrangement 

under subparagraph (A), the National Academy of 

Sciences shall enable the establishment of a key 

national indicator system by— 

(I) creating its own institutional capability; 

or 

(II) partnering with an independent private 

nonprofit organization as an Institute to implement a key national indicator system. 

(ii) INSTITUTE.—If the Academy designates an 

Institute under clause (i)(II), such Institute shall be 

a non-profit entity (as defined for purposes of section 

501(c)(3) of the Internal Revenue Code of 1986) with 

an educational mission, a governance structure that 

emphasizes independence, and characteristics that 

make such entity appropriate for establishing a key 

national indicator system. 

(iii) RESPONSIBILITIES.—Either the Academy or the 

Institute designated under clause (i)(II) shall be 

responsible for the following: 

(I) Identifying and selecting issue areas to be 

represented by the key national indicators. 

(II) Identifying and selecting the measures 

used for key national indicators within the issue 

areas under subclause (I). 
H. R. 3590—565 

(III) Identifying and selecting data to populate 

the key national indicators described under subclause (II). 

(IV) Designing, publishing, and maintaining 

a public website that contains a freely accessible 

database allowing public access to the key national 

indicators. 

(V) Developing a quality assurance framework 

to ensure rigorous and independent processes and 

the selection of quality data. 

(VI) Developing a budget for the construction 

and management of a sustainable, adaptable, and 

evolving key national indicator system that reflects 

all Commission funding of Academy and, if an 

Institute is established, Institute activities. 

(VII) Reporting annually to the Commission 

regarding its selection of issue areas, key indicators, data, and progress toward establishing a webaccessible database. 

(VIII) Responding directly to the Commission 

in response to any Commission recommendations 

and to the Academy regarding any inquiries by 

the Academy. 

(iv) GOVERNANCE.—Upon the establishment of a 

key national indicator system, the Academy shall 

create an appropriate governance mechanism that 

incorporates advisory and control functions. If an 

Institute is designated under clause (i)(II), the governance mechanism shall balance appropriate Academy 

involvement and the independence of the Institute. 

(v) MODIFICATION AND CHANGES.—The Academy 

shall retain the sole discretion, at any time, to alter 

its approach to the establishment of a key national 

indicator system or, if an Institute is designated under 

clause (i)(II), to alter any aspect of its relationship 

with the Institute or to designate a different nonprofit entity to serve as the Institute. 

(vi) CONSTRUCTION.—Nothing in this section shall 

be construed to limit the ability of the Academy or 

the Institute designated under clause (i)(II) to receive 

private funding for activities related to the establishment of a key national indicator system. 

(D) ANNUAL REPORT.—As part of the arrangement 

under subparagraph (A), the National Academy of Sciences 

shall, not later than 270 days after the date of enactment 

of this Act, and annually thereafter, submit to the CoChairpersons of the Commission a report that contains 

the findings and recommendations of the Academy. 

(d) GOVERNMENT ACCOUNTABILITY OFFICE STUDY AND

REPORT.— 

(1) GAO STUDY.—The Comptroller General of the United 

States shall conduct a study of previous work conducted by 

all public agencies, private organizations, or foreign countries 

with respect to best practices for a key national indicator 

system. The study shall be submitted to the appropriate authorizing committees of Congress. 
H. R. 3590—566 

(2) GAO FINANCIAL AUDIT.—If an Institute is established 

under this section, the Comptroller General shall conduct an 

annual audit of the financial statements of the Institute, in 

accordance with generally accepted government auditing standards and submit a report on such audit to the Commission 

and the appropriate authorizing committees of Congress. 

(3) GAO PROGRAMMATIC REVIEW.—The Comptroller General 

of the United States shall conduct programmatic assessments 

of the Institute established under this section as determined 

necessary by the Comptroller General and report the findings 

to the Commission and to the appropriate authorizing committees of Congress. 

(e) AUTHORIZATION OF APPROPRIATIONS.— (1) IN GENERAL.—–There are authorized to be appropriated to carry out the purposes of this section, $10,000,000 for fiscal 

year 2010, and $7,500,000 for each of fiscal year 2011 through 

2018. 

(2) AVAILABILITY.—–Amounts appropriated under paragraph (1) shall remain available until expended. 

Subtitle H—General Provisions 

SEC. 5701. REPORTS. 

(a) REPORTS BY SECRETARY OF HEALTH AND HUMAN SERVICES.— On an annual basis, the Secretary of Health and Human Services 

shall submit to the appropriate Committees of Congress a report 

on the activities carried out under the amendments made by this 

title, and the effectiveness of such activities. 

(b) REPORTS BY RECIPIENTS OF FUNDS.—The Secretary of Health 

and Human Services may require, as a condition of receiving funds 

under the amendments made by this title, that the entity receiving 

such award submit to such Secretary such reports as the such 

Secretary may require on activities carried out with such award, 

and the effectiveness of such activities. 

TITLE VI—TRANSPARENCY AND 

PROGRAM INTEGRITY 

Subtitle A—Physician Ownership and 

Other Transparency 

SEC. 6001. LIMITATION ON MEDICARE EXCEPTION TO THE PROHIBITION ON CERTAIN PHYSICIAN REFERRALS FOR HOSPITALS. 

(a) IN GENERAL.—Section 1877 of the Social Security Act (42 

U.S.C. 1395nn) is amended— 

(1) in subsection (d)(2)— 

(A) in subparagraph (A), by striking ‘‘and’’ at the end; 

(B) in subparagraph (B), by striking the period at 

the end and inserting ‘‘; and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(C) in the case where the entity is a hospital, the 

hospital meets the requirements of paragraph (3)(D).’’; 
H. R. 3590—567 

(2) in subsection (d)(3)— 

(A) in subparagraph (B), by striking ‘‘and’’ at the end; 

(B) in subparagraph (C), by striking the period at 

the end and inserting ‘‘; and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(D) the hospital meets the requirements described 

in subsection (i)(1) not later than 18 months after the 

date of the enactment of this subparagraph.’’; and 

(3) by adding at the end the following new subsection: 

‘‘(i) REQUIREMENTS FOR HOSPITALS TO QUALIFY FOR RURAL

PROVIDER AND HOSPITAL EXCEPTION TO OWNERSHIP OR INVESTMENT

PROHIBITION.— 

‘‘(1) REQUIREMENTS DESCRIBED.—For purposes of subsection 

(d)(3)(D), the requirements described in this paragraph for a 

hospital are as follows: 

‘‘(A) PROVIDER AGREEMENT.—The hospital had— 

‘‘(i) physician ownership or investment on February 1, 2010; and 

‘‘(ii) a provider agreement under section 1866 in 

effect on such date. 

‘‘(B) LIMITATION ON EXPANSION OF FACILITY CAPACITY.— 

Except as provided in paragraph (3), the number of operating rooms, procedure rooms, and beds for which the hospital is licensed at any time on or after the date of the 

enactment of this subsection is no greater than the number 

of operating rooms, procedure rooms, and beds for which 

the hospital is licensed as of such date. 

‘‘(C) PREVENTING CONFLICTS OF INTEREST.— 

‘‘(i) The hospital submits to the Secretary an 

annual report containing a detailed description of— 

‘‘(I) the identity of each physician owner or 

investor and any other owners or investors of the 

hospital; and 

‘‘(II) the nature and extent of all ownership 

and investment interests in the hospital. 

‘‘(ii) The hospital has procedures in place to require 

that any referring physician owner or investor discloses 

to the patient being referred, by a time that permits 

the patient to make a meaningful decision regarding 

the receipt of care, as determined by the Secretary— 

‘‘(I) the ownership or investment interest, as 

applicable, of such referring physician in the hospital; and 

‘‘(II) if applicable, any such ownership or 

investment interest of the treating physician. 

‘‘(iii) The hospital does not condition any physician 

ownership or investment interests either directly or 

indirectly on the physician owner or investor making 

or influencing referrals to the hospital or otherwise 

generating business for the hospital. 

‘‘(iv) The hospital discloses the fact that the hospital is partially owned or invested in by physicians— 

‘‘(I) on any public website for the hospital; 

and 

‘‘(II) in any public advertising for the hospital. 

‘‘(D) ENSURING BONA FIDE INVESTMENT.— 
H. R. 3590—568 

‘‘(i) The percentage of the total value of the ownership or investment interests held in the hospital, or 

in an entity whose assets include the hospital, by physician owners or investors in the aggregate does not 

exceed such percentage as of the date of enactment 

of this subsection. 

‘‘(ii) Any ownership or investment interests that 

the hospital offers to a physician owner or investor 

are not offered on more favorable terms than the terms 

offered to a person who is not a physician owner or 

investor. 

‘‘(iii) The hospital (or any owner or investor in 

the hospital) does not directly or indirectly provide 

loans or financing for any investment in the hospital 

by a physician owner or investor. 

‘‘(iv) The hospital (or any owner or investor in 

the hospital) does not directly or indirectly guarantee 

a loan, make a payment toward a loan, or otherwise 

subsidize a loan, for any individual physician owner 

or investor or group of physician owners or investors 

that is related to acquiring any ownership or investment interest in the hospital. 

‘‘(v) Ownership or investment returns are distributed to each owner or investor in the hospital in an 

amount that is directly proportional to the ownership 

or investment interest of such owner or investor in 

the hospital. 

‘‘(vi) Physician owners and investors do not receive, 

directly or indirectly, any guaranteed receipt of or right 

to purchase other business interests related to the 

hospital, including the purchase or lease of any property under the control of other owners or investors 

in the hospital or located near the premises of the 

hospital. 

‘‘(vii) The hospital does not offer a physician owner 

or investor the opportunity to purchase or lease any 

property under the control of the hospital or any other 

owner or investor in the hospital on more favorable 

terms than the terms offered to an individual who 

is not a physician owner or investor. 

‘‘(E) PATIENT SAFETY.— 

‘‘(i) Insofar as the hospital admits a patient and 

does not have any physician available on the premises 

to provide services during all hours in which the hospital is providing services to such patient, before admitting the patient— 

‘‘(I) the hospital discloses such fact to a 

patient; and 

‘‘(II) following such disclosure, the hospital 

receives from the patient a signed acknowledgment 

that the patient understands such fact. 

‘‘(ii) The hospital has the capacity to— 

‘‘(I) provide assessment and initial treatment 

for patients; and 

‘‘(II) refer and transfer patients to hospitals 

with the capability to treat the needs of the patient 

involved. 
H. R. 3590—569 

‘‘(F) LIMITATION ON APPLICATION TO CERTAIN CONVERTED FACILITIES.—The hospital was not converted from 

an ambulatory surgical center to a hospital on or after 

the date of enactment of this subsection. 

‘‘(2) PUBLICATION OF INFORMATION REPORTED.—The Secretary shall publish, and update on an annual basis, the 

information submitted by hospitals under paragraph (1)(C)(i) 

on the public Internet website of the Centers for Medicare 

& Medicaid Services. 

‘‘(3) EXCEPTION TO PROHIBITION ON EXPANSION OF FACILITY

CAPACITY.— 

‘‘(A) PROCESS.— 

‘‘(i) ESTABLISHMENT.—The Secretary shall establish and implement a process under which an 

applicable hospital (as defined in subparagraph (E)) 

may apply for an exception from the requirement under 

paragraph (1)(B). 

‘‘(ii) OPPORTUNITY FOR COMMUNITY INPUT.—The 

process under clause (i) shall provide individuals and 

entities in the community in which the applicable hospital applying for an exception is located with the 

opportunity to provide input with respect to the 

application. 

‘‘(iii) TIMING FOR IMPLEMENTATION.—The Secretary 

shall implement the process under clause (i) on August 

1, 2011. 

‘‘(iv) REGULATIONS.—Not later than July 1, 2011, 

the Secretary shall promulgate regulations to carry 

out the process under clause (i). 

‘‘(B) FREQUENCY.—The process described in subparagraph (A) shall permit an applicable hospital to apply for 

an exception up to once every 2 years. 

‘‘(C) PERMITTED INCREASE.— ‘‘(i) IN GENERAL.—Subject to clause (ii) and 

subparagraph (D), an applicable hospital granted an 

exception under the process described in subparagraph 

(A) may increase the number of operating rooms, procedure rooms, and beds for which the applicable hospital 

is licensed above the baseline number of operating 

rooms, procedure rooms, and beds of the applicable 

hospital (or, if the applicable hospital has been granted 

a previous exception under this paragraph, above the 

number of operating rooms, procedure rooms, and beds 

for which the hospital is licensed after the application 

of the most recent increase under such an exception). 

‘‘(ii) 100 PERCENT INCREASE LIMITATION.—The Secretary shall not permit an increase in the number 

of operating rooms, procedure rooms, and beds for 

which an applicable hospital is licensed under clause 

(i) to the extent such increase would result in the 

number of operating rooms, procedure rooms, and beds 

for which the applicable hospital is licensed exceeding 

200 percent of the baseline number of operating rooms, 

procedure rooms, and beds of the applicable hospital. 

‘‘(iii) BASELINE NUMBER OF OPERATING ROOMS, 

PROCEDURE ROOMS, AND BEDS.—In this paragraph, the 

term ‘baseline number of operating rooms, procedure 
H. R. 3590—570 

rooms, and beds’ means the number of operating rooms, 

procedure rooms, and beds for which the applicable 

hospital is licensed as of the date of enactment of 

this subsection. 

‘‘(D) INCREASE LIMITED TO FACILITIES ON THE MAIN

CAMPUS OF THE HOSPITAL.—Any increase in the number 

of operating rooms, procedure rooms, and beds for which 

an applicable hospital is licensed pursuant to this paragraph may only occur in facilities on the main campus 

of the applicable hospital. 

‘‘(E) APPLICABLE HOSPITAL.—In this paragraph, the 

term ‘applicable hospital’ means a hospital— 

‘‘(i) that is located in a county in which the percentage increase in the population during the most recent 

5-year period (as of the date of the application under 

subparagraph (A)) is at least 150 percent of the 

percentage increase in the population growth of the 

State in which the hospital is located during that 

period, as estimated by Bureau of the Census; 

‘‘(ii) whose annual percent of total inpatient admissions that represent inpatient admissions under the 

program under title XIX is equal to or greater than 

the average percent with respect to such admissions 

for all hospitals located in the county in which the 

hospital is located; 

‘‘(iii) that does not discriminate against beneficiaries of Federal health care programs and does 

not permit physicians practicing at the hospital to 

discriminate against such beneficiaries; 

‘‘(iv) that is located in a State in which the average 

bed capacity in the State is less than the national 

average bed capacity; and 

‘‘(v) that has an average bed occupancy rate that 

is greater than the average bed occupancy rate in 

the State in which the hospital is located. 

‘‘(F) PROCEDURE ROOMS.—In this subsection, the term 

‘procedure rooms’ includes rooms in which catheterizations, 

angiographies, angiograms, and endoscopies are performed, 

except such term shall not include emergency rooms or 

departments (exclusive of rooms in which catheterizations, 

angiographies, angiograms, and endoscopies are performed). 

‘‘(G) PUBLICATION OF FINAL DECISIONS.—Not later than 

60 days after receiving a complete application under this 

paragraph, the Secretary shall publish in the Federal Register the final decision with respect to such application. 

‘‘(H) LIMITATION ON REVIEW.—There shall be no 

administrative or judicial review under section 1869, section 1878, or otherwise of the process under this paragraph 

(including the establishment of such process). 

‘‘(4) COLLECTION OF OWNERSHIP AND INVESTMENT INFORMA- TION.—For purposes of subparagraphs (A)(i) and (D)(i) of paragraph (1), the Secretary shall collect physician ownership and 

investment information for each hospital. 

‘‘(5) PHYSICIAN OWNER OR INVESTOR DEFINED.—For purposes of this subsection, the term ‘physician owner or investor’ 

means a physician (or an immediate family member of such 
H. R. 3590—571 

physician) with a direct or an indirect ownership or investment 

interest in the hospital. 

‘‘(6) CLARIFICATION.—Nothing in this subsection shall be 

construed as preventing the Secretary from revoking a hospital’s provider agreement if not in compliance with regulations 

implementing section 1866.’’. 

(b) ENFORCEMENT.— 

(1) ENSURING COMPLIANCE.—The Secretary of Health and 

Human Services shall establish policies and procedures to 

ensure compliance with the requirements described in subsection (i)(1) of section 1877 of the Social Security Act, as 

added by subsection (a)(3), beginning on the date such requirements first apply. Such policies and procedures may include 

unannounced site reviews of hospitals. 

(2) AUDITS.—Beginning not later than November 1, 2011, 

the Secretary of Health and Human Services shall conduct 

audits to determine if hospitals violate the requirements 

referred to in paragraph (1). 

SEC. 6002. TRANSPARENCY REPORTS AND REPORTING OF PHYSICIAN 

OWNERSHIP OR INVESTMENT INTERESTS. 

Part A of title XI of the Social Security Act (42 U.S.C. 1301 

et seq.) is amended by inserting after section 1128F the following 

new section: 

‘‘SEC. 1128G. TRANSPARENCY REPORTS AND REPORTING OF PHYSICIAN OWNERSHIP OR INVESTMENT INTERESTS. 

‘‘(a) TRANSPARENCY REPORTS.— ‘‘(1) PAYMENTS OR OTHER TRANSFERS OF VALUE.— 

‘‘(A) IN GENERAL.—On March 31, 2013, and on the 

90th day of each calendar year beginning thereafter, any 

applicable manufacturer that provides a payment or other 

transfer of value to a covered recipient (or to an entity 

or individual at the request of or designated on behalf 

of a covered recipient), shall submit to the Secretary, in 

such electronic form as the Secretary shall require, the 

following information with respect to the preceding calendar year: 

‘‘(i) The name of the covered recipient. 

‘‘(ii) The business address of the covered recipient 

and, in the case of a covered recipient who is a physician, the specialty and National Provider Identifier 

of the covered recipient. 

‘‘(iii) The amount of the payment or other transfer 

of value. 

‘‘(iv) The dates on which the payment or other 

transfer of value was provided to the covered recipient. 

‘‘(v) A description of the form of the payment or 

other transfer of value, indicated (as appropriate for 

all that apply) as— 

‘‘(I) cash or a cash equivalent; 

‘‘(II) in-kind items or services; 

‘‘(III) stock, a stock option, or any other ownership interest, dividend, profit, or other return on 

investment; or 

‘‘(IV) any other form of payment or other 

transfer of value (as defined by the Secretary). 
H. R. 3590—572 

‘‘(vi) A description of the nature of the payment 

or other transfer of value, indicated (as appropriate 

for all that apply) as— 

‘‘(I) consulting fees; 

‘‘(II) compensation for services other than consulting; 

‘‘(III) honoraria; 

‘‘(IV) gift; 

‘‘(V) entertainment; 

‘‘(VI) food; 

‘‘(VII) travel (including the specified destinations); 

‘‘(VIII) education; 

‘‘(IX) research; 

‘‘(X) charitable contribution; 

‘‘(XI) royalty or license; 

‘‘(XII) current or prospective ownership or 

investment interest; 

‘‘(XIII) direct compensation for serving as faculty or as a speaker for a medical education program; 

‘‘(XIV) grant; or 

‘‘(XV) any other nature of the payment or other 

transfer of value (as defined by the Secretary). 

‘‘(vii) If the payment or other transfer of value 

is related to marketing, education, or research specific 

to a covered drug, device, biological, or medical supply, 

the name of that covered drug, device, biological, or 

medical supply. 

‘‘(viii) Any other categories of information 

regarding the payment or other transfer of value the 

Secretary determines appropriate. 

‘‘(B) SPECIAL RULE FOR CERTAIN PAYMENTS OR OTHER

TRANSFERS OF VALUE.—In the case where an applicable 

manufacturer provides a payment or other transfer of value 

to an entity or individual at the request of or designated 

on behalf of a covered recipient, the applicable manufacturer shall disclose that payment or other transfer of value 

under the name of the covered recipient. 

‘‘(2) PHYSICIAN OWNERSHIP.—In addition to the requirement 

under paragraph (1)(A), on March 31, 2013, and on the 90th 

day of each calendar year beginning thereafter, any applicable 

manufacturer or applicable group purchasing organization shall 

submit to the Secretary, in such electronic form as the Secretary 

shall require, the following information regarding any ownership or investment interest (other than an ownership or investment interest in a publicly traded security and mutual fund, 

as described in section 1877(c)) held by a physician (or an 

immediate family member of such physician (as defined for 

purposes of section 1877(a))) in the applicable manufacturer 

or applicable group purchasing organization during the preceding year: 

‘‘(A) The dollar amount invested by each physician 

holding such an ownership or investment interest. 

‘‘(B) The value and terms of each such ownership or 

investment interest. 
H. R. 3590—573 

‘‘(C) Any payment or other transfer of value provided 

to a physician holding such an ownership or investment 

interest (or to an entity or individual at the request of 

or designated on behalf of a physician holding such an 

ownership or investment interest), including the information described in clauses (i) through (viii) of paragraph 

(1)(A), except that in applying such clauses, ‘physician’ 

shall be substituted for ‘covered recipient’ each place it 

appears. 

‘‘(D) Any other information regarding the ownership 

or investment interest the Secretary determines appropriate. 

‘‘(b) PENALTIES FOR NONCOMPLIANCE.— 

‘‘(1) FAILURE TO REPORT.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B) except 

as provided in paragraph (2), any applicable manufacturer 

or applicable group purchasing organization that fails to 

submit information required under subsection (a) in a 

timely manner in accordance with rules or regulations 

promulgated to carry out such subsection, shall be subject 

to a civil money penalty of not less than $1,000, but not 

more than $10,000, for each payment or other transfer 

of value or ownership or investment interest not reported 

as required under such subsection. Such penalty shall be 

imposed and collected in the same manner as civil money 

penalties under subsection (a) of section 1128A are imposed 

and collected under that section. 

‘‘(B) LIMITATION.—The total amount of civil money penalties imposed under subparagraph (A) with respect to 

each annual submission of information under subsection 

(a) by an applicable manufacturer or applicable group purchasing organization shall not exceed $150,000. 

‘‘(2) KNOWING FAILURE TO REPORT.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), any 

applicable manufacturer or applicable group purchasing 

organization that knowingly fails to submit information 

required under subsection (a) in a timely manner in accordance with rules or regulations promulgated to carry out 

such subsection, shall be subject to a civil money penalty 

of not less than $10,000, but not more than $100,000, 

for each payment or other transfer of value or ownership 

or investment interest not reported as required under such 

subsection. Such penalty shall be imposed and collected 

in the same manner as civil money penalties under subsection (a) of section 1128A are imposed and collected under 

that section. 

‘‘(B) LIMITATION.—The total amount of civil money penalties imposed under subparagraph (A) with respect to 

each annual submission of information under subsection 

(a) by an applicable manufacturer or applicable group purchasing organization shall not exceed $1,000,000. 

‘‘(3) USE OF FUNDS.—Funds collected by the Secretary as 

a result of the imposition of a civil money penalty under this 

subsection shall be used to carry out this section. 

‘‘(c) PROCEDURES FOR SUBMISSION OF INFORMATION AND PUBLIC

AVAILABILITY.— 

‘‘(1) IN GENERAL.— 
H. R. 3590—574 

‘‘(A) ESTABLISHMENT.—Not later than October 1, 2011, 

the Secretary shall establish procedures— 

‘‘(i) for applicable manufacturers and applicable 

group purchasing organizations to submit information 

to the Secretary under subsection (a); and 

‘‘(ii) for the Secretary to make such information 

submitted available to the public. 

‘‘(B) DEFINITION OF TERMS.—The procedures established under subparagraph (A) shall provide for the definition of terms (other than those terms defined in subsection 

(e)), as appropriate, for purposes of this section. 

‘‘(C) PUBLIC AVAILABILITY.—Except as provided in 

subparagraph (E), the procedures established under 

subparagraph (A)(ii) shall ensure that, not later than September 30, 2013, and on June 30 of each calendar year 

beginning thereafter, the information submitted under subsection (a) with respect to the preceding calendar year 

is made available through an Internet website that— 

‘‘(i) is searchable and is in a format that is clear 

and understandable; 

‘‘(ii) contains information that is presented by the 

name of the applicable manufacturer or applicable 

group purchasing organization, the name of the covered 

recipient, the business address of the covered recipient, 

the specialty of the covered recipient, the value of 

the payment or other transfer of value, the date on 

which the payment or other transfer of value was 

provided to the covered recipient, the form of the payment or other transfer of value, indicated (as appropriate) under subsection (a)(1)(A)(v), the nature of the 

payment or other transfer of value, indicated (as appropriate) under subsection (a)(1)(A)(vi), and the name 

of the covered drug, device, biological, or medical 

supply, as applicable; 

‘‘(iii) contains information that is able to be easily 

aggregated and downloaded; 

‘‘(iv) contains a description of any enforcement 

actions taken to carry out this section, including any 

penalties imposed under subsection (b), during the preceding year; 

‘‘(v) contains background information on industryphysician relationships; 

‘‘(vi) in the case of information submitted with 

respect to a payment or other transfer of value 

described in subparagraph (E)(i), lists such information 

separately from the other information submitted under 

subsection (a) and designates such separately listed 

information as funding for clinical research; 

‘‘(vii) contains any other information the Secretary 

determines would be helpful to the average consumer; 

‘‘(viii) does not contain the National Provider 

Identifier of the covered recipient, and 

‘‘(ix) subject to subparagraph (D), provides the 

applicable manufacturer, applicable group purchasing 

organization, or covered recipient an opportunity to 

review and submit corrections to the information submitted with respect to the applicable manufacturer, 
H. R. 3590—575 

applicable group purchasing organization, or covered 

recipient, respectively, for a period of not less than 

45 days prior to such information being made available 

to the public. 

‘‘(D) CLARIFICATION OF TIME PERIOD FOR REVIEW AND

CORRECTIONS.—In no case may the 45-day period for review 

and submission of corrections to information under 

subparagraph (C)(ix) prevent such information from being 

made available to the public in accordance with the dates 

described in the matter preceding clause (i) in subparagraph (C). 

‘‘(E) DELAYED PUBLICATION FOR PAYMENTS MADE PURSUANT TO PRODUCT RESEARCH OR DEVELOPMENT AGREEMENTS

AND CLINICAL INVESTIGATIONS.— 

‘‘(i) IN GENERAL.—In the case of information submitted under subsection (a) with respect to a payment 

or other transfer of value made to a covered recipient 

by an applicable manufacturer pursuant to a product 

research or development agreement for services furnished in connection with research on a potential new 

medical technology or a new application of an existing 

medical technology or the development of a new drug, 

device, biological, or medical supply, or by an applicable 

manufacturer in connection with a clinical investigation regarding a new drug, device, biological, or medical 

supply, the procedures established under subparagraph 

(A)(ii) shall provide that such information is made 

available to the public on the first date described in 

the matter preceding clause (i) in subparagraph (C) 

after the earlier of the following: 

‘‘(I) The date of the approval or clearance of 

the covered drug, device, biological, or medical 

supply by the Food and Drug Administration. 

‘‘(II) Four calendar years after the date such 

payment or other transfer of value was made. 

‘‘(ii) CONFIDENTIALITY OF INFORMATION PRIOR TO

PUBLICATION.—Information described in clause (i) shall 

be considered confidential and shall not be subject 

to disclosure under section 552 of title 5, United States 

Code, or any other similar Federal, State, or local 

law, until on or after the date on which the information 

is made available to the public under such clause. 

‘‘(2) CONSULTATION.—In establishing the procedures under 

paragraph (1), the Secretary shall consult with the Inspector 

General of the Department of Health and Human Services, 

affected industry, consumers, consumer advocates, and other 

interested parties in order to ensure that the information made 

available to the public under such paragraph is presented in 

the appropriate overall context. 

‘‘(d) ANNUAL REPORTS AND RELATION TO STATE LAWS.— 

‘‘(1) ANNUAL REPORT TO CONGRESS.—Not later than April 

1 of each year beginning with 2013, the Secretary shall submit 

to Congress a report that includes the following: 

‘‘(A) The information submitted under subsection (a) 

during the preceding year, aggregated for each applicable 

manufacturer and applicable group purchasing organization that submitted such information during such year 
H. R. 3590—576 

(except, in the case of information submitted with respect 

to a payment or other transfer of value described in subsection (c)(1)(E)(i), such information shall be included in 

the first report submitted to Congress after the date on 

which such information is made available to the public 

under such subsection). 

‘‘(B) A description of any enforcement actions taken 

to carry out this section, including any penalties imposed 

under subsection (b), during the preceding year. 

‘‘(2) ANNUAL REPORTS TO STATES.—Not later than September 30, 2013 and on June 30 of each calendar year thereafter, the Secretary shall submit to States a report that includes 

a summary of the information submitted under subsection (a) 

during the preceding year with respect to covered recipients 

in the State (except, in the case of information submitted with 

respect to a payment or other transfer of value described in 

subsection (c)(1)(E)(i), such information shall be included in 

the first report submitted to States after the date on which 

such information is made available to the public under such 

subsection). 

‘‘(3) RELATION TO STATE LAWS.— 

‘‘(A) IN GENERAL.—In the case of a payment or other 

transfer of value provided by an applicable manufacturer 

that is received by a covered recipient (as defined in subsection (e)) on or after January 1, 2012, subject to subparagraph (B), the provisions of this section shall preempt 

any statute or regulation of a State or of a political subdivision of a State that requires an applicable manufacturer 

(as so defined) to disclose or report, in any format, the 

type of information (as described in subsection (a)) 

regarding such payment or other transfer of value. 

‘‘(B) NO PREEMPTION OF ADDITIONAL REQUIREMENTS.— 

Subparagraph (A) shall not preempt any statute or regulation of a State or of a political subdivision of a State 

that requires the disclosure or reporting of information— 

‘‘(i) not of the type required to be disclosed or 

reported under this section; 

‘‘(ii) described in subsection (e)(10)(B), except in 

the case of information described in clause (i) of such 

subsection; 

‘‘(iii) by any person or entity other than an 

applicable manufacturer (as so defined) or a covered 

recipient (as defined in subsection (e)); or 

‘‘(iv) to a Federal, State, or local governmental 

agency for public health surveillance, investigation, or 

other public health purposes or health oversight purposes. 

‘‘(C) Nothing in subparagraph (A) shall be construed 

to limit the discovery or admissibility of information 

described in such subparagraph in a criminal, civil, or 

administrative proceeding. 

‘‘(4) CONSULTATION.—The Secretary shall consult with the 

Inspector General of the Department of Health and Human 

Services on the implementation of this section. 

‘‘(e) DEFINITIONS.—In this section: 

‘‘(1) APPLICABLE GROUP PURCHASING ORGANIZATION.—The 

term ‘applicable group purchasing organization’ means a group 
H. R. 3590—577 

purchasing organization (as defined by the Secretary) that purchases, arranges for, or negotiates the purchase of a covered 

drug, device, biological, or medical supply which is operating 

in the United States, or in a territory, possession, or commonwealth of the United States. 

‘‘(2) APPLICABLE MANUFACTURER.—The term ‘applicable 

manufacturer’ means a manufacturer of a covered drug, device, 

biological, or medical supply which is operating in the United 

States, or in a territory, possession, or commonwealth of the 

United States. 

‘‘(3) CLINICAL INVESTIGATION.—The term ‘clinical investigation’ means any experiment involving 1 or more human subjects, or materials derived from human subjects, in which a 

drug or device is administered, dispensed, or used. 

‘‘(4) COVERED DEVICE.—The term ‘covered device’ means 

any device for which payment is available under title XVIII 

or a State plan under title XIX or XXI (or a waiver of such 

a plan). 

‘‘(5) COVERED DRUG, DEVICE, BIOLOGICAL, OR MEDICAL

SUPPLY.—The term ‘covered drug, device, biological, or medical 

supply’ means any drug, biological product, device, or medical 

supply for which payment is available under title XVIII or 

a State plan under title XIX or XXI (or a waiver of such 

a plan). 

‘‘(6) COVERED RECIPIENT.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), the term ‘covered recipient’ means the following: 

‘‘(i) A physician. 

‘‘(ii) A teaching hospital. 

‘‘(B) EXCLUSION.—Such term does not include a physician who is an employee of the applicable manufacturer 

that is required to submit information under subsection 

(a). 

‘‘(7) EMPLOYEE.—The term ‘employee’ has the meaning 

given such term in section 1877(h)(2). 

‘‘(8) KNOWINGLY.—The term ‘knowingly’ has the meaning 

given such term in section 3729(b) of title 31, United States 

Code. 

‘‘(9) MANUFACTURER OF A COVERED DRUG, DEVICE, BIOLOGICAL, OR MEDICAL SUPPLY.—The term ‘manufacturer of 

a covered drug, device, biological, or medical supply’ means 

any entity which is engaged in the production, preparation, 

propagation, compounding, or conversion of a covered drug, 

device, biological, or medical supply (or any entity under 

common ownership with such entity which provides assistance 

or support to such entity with respect to the production, 

preparation, propagation, compounding, conversion, marketing, 

promotion, sale, or distribution of a covered drug, device, 

biological, or medical supply). 

‘‘(10) PAYMENT OR OTHER TRANSFER OF VALUE.— 

‘‘(A) IN GENERAL.—The term ‘payment or other transfer 

of value’ means a transfer of anything of value. Such term 

does not include a transfer of anything of value that is 

made indirectly to a covered recipient through a third 

party in connection with an activity or service in the case 

where the applicable manufacturer is unaware of the 

identity of the covered recipient. 
H. R. 3590—578 

‘‘(B) EXCLUSIONS.—An applicable manufacturer shall 

not be required to submit information under subsection 

(a) with respect to the following: 

‘‘(i) A transfer of anything the value of which is 

less than $10, unless the aggregate amount transferred 

to, requested by, or designated on behalf of the covered 

recipient by the applicable manufacturer during the 

calendar year exceeds $100. For calendar years after 

2012, the dollar amounts specified in the preceding 

sentence shall be increased by the same percentage 

as the percentage increase in the consumer price index 

for all urban consumers (all items; U.S. city average) 

for the 12-month period ending with June of the previous year. 

‘‘(ii) Product samples that are not intended to be 

sold and are intended for patient use. 

‘‘(iii) Educational materials that directly benefit 

patients or are intended for patient use. 

‘‘(iv) The loan of a covered device for a shortterm trial period, not to exceed 90 days, to permit 

evaluation of the covered device by the covered 

recipient. 

‘‘(v) Items or services provided under a contractual 

warranty, including the replacement of a covered 

device, where the terms of the warranty are set forth 

in the purchase or lease agreement for the covered 

device. 

‘‘(vi) A transfer of anything of value to a covered 

recipient when the covered recipient is a patient and 

not acting in the professional capacity of a covered 

recipient. 

‘‘(vii) Discounts (including rebates). 

‘‘(viii) In-kind items used for the provision of 

charity care. 

‘‘(ix) A dividend or other profit distribution from, 

or ownership or investment interest in, a publicly 

traded security and mutual fund (as described in section 1877(c)). 

‘‘(x) In the case of an applicable manufacturer 

who offers a self-insured plan, payments for the provision of health care to employees under the plan. 

‘‘(xi) In the case of a covered recipient who is 

a licensed non-medical professional, a transfer of anything of value to the covered recipient if the transfer 

is payment solely for the non-medical professional services of such licensed non-medical professional. 

‘‘(xii) In the case of a covered recipient who is 

a physician, a transfer of anything of value to the 

covered recipient if the transfer is payment solely for 

the services of the covered recipient with respect to 

a civil or criminal action or an administrative proceeding. 

‘‘(11) PHYSICIAN.—The term ‘physician’ has the meaning 

given that term in section 1861(r).’’. 
H. R. 3590—579 

SEC. 6003. DISCLOSURE REQUIREMENTS FOR IN-OFFICE ANCILLARY 

SERVICES EXCEPTION TO THE PROHIBITION ON PHYSICIAN SELF-REFERRAL FOR CERTAIN IMAGING SERVICES. 

(a) IN GENERAL.—Section 1877(b)(2) of the Social Security Act 

(42 U.S.C. 1395nn(b)(2)) is amended by adding at the end the 

following new sentence: ‘‘Such requirements shall, with respect 

to magnetic resonance imaging, computed tomography, positron 

emission tomography, and any other designated health services 

specified under subsection (h)(6)(D) that the Secretary determines 

appropriate, include a requirement that the referring physician 

inform the individual in writing at the time of the referral that 

the individual may obtain the services for which the individual 

is being referred from a person other than a person described 

in subparagraph (A)(i) and provide such individual with a written 

list of suppliers (as defined in section 1861(d)) who furnish such 

services in the area in which such individual resides.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to services furnished on or after January 1, 2010. 

SEC. 6004. PRESCRIPTION DRUG SAMPLE TRANSPARENCY. 

Part A of title XI of the Social Security Act (42 U.S.C. 1301 

et seq.), as amended by section 6002, is amended by inserting 

after section 1128G the following new section: 

‘‘SEC. 1128H. REPORTING OF INFORMATION RELATING TO DRUG SAMPLES. 

‘‘(a) IN GENERAL.—Not later than April 1 of each year (beginning with 2012), each manufacturer and authorized distributor 

of record of an applicable drug shall submit to the Secretary (in 

a form and manner specified by the Secretary) the following 

information with respect to the preceding year: 

‘‘(1) In the case of a manufacturer or authorized distributor 

of record which makes distributions by mail or common carrier 

under subsection (d)(2) of section 503 of the Federal Food, 

Drug, and Cosmetic Act (21 U.S.C. 353), the identity and 

quantity of drug samples requested and the identity and 

quantity of drug samples distributed under such subsection 

during that year, aggregated by— 

‘‘(A) the name, address, professional designation, and 

signature of the practitioner making the request under 

subparagraph (A)(i) of such subsection, or of any individual 

who makes or signs for the request on behalf of the practitioner; and 

‘‘(B) any other category of information determined 

appropriate by the Secretary. 

‘‘(2) In the case of a manufacturer or authorized distributor 

of record which makes distributions by means other than mail 

or common carrier under subsection (d)(3) of such section 503, 

the identity and quantity of drug samples requested and the 

identity and quantity of drug samples distributed under such 

subsection during that year, aggregated by— 

‘‘(A) the name, address, professional designation, and 

signature of the practitioner making the request under 

subparagraph (A)(i) of such subsection, or of any individual 

who makes or signs for the request on behalf of the practitioner; and 
H. R. 3590—580 

‘‘(B) any other category of information determined 

appropriate by the Secretary. 

‘‘(b) DEFINITIONS.—In this section: 

‘‘(1) APPLICABLE DRUG.—The term ‘applicable drug’ means 

a drug— 

‘‘(A) which is subject to subsection (b) of such section 

503; and 

‘‘(B) for which payment is available under title XVIII 

or a State plan under title XIX or XXI (or a waiver of 

such a plan). 

‘‘(2) AUTHORIZED DISTRIBUTOR OF RECORD.—The term 

‘authorized distributor of record’ has the meaning given that 

term in subsection (e)(3)(A) of such section. 

‘‘(3) MANUFACTURER.—The term ‘manufacturer’ has the 

meaning given that term for purposes of subsection (d) of such 

section.’’. 

SEC. 6005. PHARMACY BENEFIT MANAGERS TRANSPARENCY REQUIREMENTS. 

Part A of title XI of the Social Security Act (42 U.S.C. 1301 

et seq.) is amended by inserting after section 1150 the following 

new section: 

‘‘SEC. 1150A. PHARMACY BENEFIT MANAGERS TRANSPARENCY 

REQUIREMENTS. 

‘‘(a) PROVISION OF INFORMATION.—A health benefits plan or 

any entity that provides pharmacy benefits management services 

on behalf of a health benefits plan (in this section referred to 

as a ‘PBM’) that manages prescription drug coverage under a contract with— 

‘‘(1) a PDP sponsor of a prescription drug plan or an MA 

organization offering an MA–PD plan under part D of title 

XVIII; or 

‘‘(2) a qualified health benefits plan offered through an 

exchange established by a State under section 1311 of the 

Patient Protection and Affordable Care Act, 

shall provide the information described in subsection (b) to the 

Secretary and, in the case of a PBM, to the plan with which 

the PBM is under contract with, at such times, and in such form 

and manner, as the Secretary shall specify. 

‘‘(b) INFORMATION DESCRIBED.—The information described in 

this subsection is the following with respect to services provided 

by a health benefits plan or PBM for a contract year: 

‘‘(1) The percentage of all prescriptions that were provided 

through retail pharmacies compared to mail order pharmacies, 

and the percentage of prescriptions for which a generic drug 

was available and dispensed (generic dispensing rate), by pharmacy type (which includes an independent pharmacy, chain 

pharmacy, supermarket pharmacy, or mass merchandiser pharmacy that is licensed as a pharmacy by the State and that 

dispenses medication to the general public), that is paid by 

the health benefits plan or PBM under the contract. 

‘‘(2) The aggregate amount, and the type of rebates, discounts, or price concessions (excluding bona fide service fees, 

which include but are not limited to distribution service fees, 

inventory management fees, product stocking allowances, and 

fees associated with administrative services agreements and 

patient care programs (such as medication compliance programs 
H. R. 3590—581 

and patient education programs)) that the PBM negotiates 

that are attributable to patient utilization under the plan, 

and the aggregate amount of the rebates, discounts, or price 

concessions that are passed through to the plan sponsor, and 

the total number of prescriptions that were dispensed. 

‘‘(3) The aggregate amount of the difference between the 

amount the health benefits plan pays the PBM and the amount 

that the PBM pays retail pharmacies, and mail order pharmacies, and the total number of prescriptions that were dispensed. 

‘‘(c) CONFIDENTIALITY.—Information disclosed by a health benefits plan or PBM under this section is confidential and shall not 

be disclosed by the Secretary or by a plan receiving the information, 

except that the Secretary may disclose the information in a form 

which does not disclose the identity of a specific PBM, plan, or 

prices charged for drugs, for the following purposes: 

‘‘(1) As the Secretary determines to be necessary to carry 

out this section or part D of title XVIII. 

‘‘(2) To permit the Comptroller General to review the 

information provided. 

‘‘(3) To permit the Director of the Congressional Budget 

Office to review the information provided. 

‘‘(4) To States to carry out section 1311 of the Patient 

Protection and Affordable Care Act. 

‘‘(d) PENALTIES.—The provisions of subsection (b)(3)(C) of section 1927 shall apply to a health benefits plan or PBM that fails 

to provide information required under subsection (a) on a timely 

basis or that knowingly provides false information in the same 

manner as such provisions apply to a manufacturer with an agreement under that section.’’. 

Subtitle B—Nursing Home Transparency 

and Improvement 

PART I—IMPROVING TRANSPARENCY OF 

INFORMATION 

SEC. 6101. REQUIRED DISCLOSURE OF OWNERSHIP AND ADDITIONAL 

DISCLOSABLE PARTIES INFORMATION. 

(a) IN GENERAL.—Section 1124 of the Social Security Act (42 

U.S.C. 1320a–3) is amended by adding at the end the following 

new subsection: 

‘‘(c) REQUIRED DISCLOSURE OF OWNERSHIP AND ADDITIONAL

DISCLOSABLE PARTIES INFORMATION.— 

‘‘(1) DISCLOSURE.—A facility shall have the information 

described in paragraph (2) available— 

‘‘(A) during the period beginning on the date of the 

enactment of this subsection and ending on the date such 

information is made available to the public under section 

6101(b) of the Patient Protection and Affordable Care Act 

for submission to the Secretary, the Inspector General of 

the Department of Health and Human Services, the State 

in which the facility is located, and the State long-term 

care ombudsman in the case where the Secretary, the 
H. R. 3590—582 

Inspector General, the State, or the State long-term care 

ombudsman requests such information; and 

‘‘(B) beginning on the effective date of the final regulations promulgated under paragraph (3)(A), for reporting 

such information in accordance with such final regulations. 

Nothing in subparagraph (A) shall be construed as authorizing 

a facility to dispose of or delete information described in such 

subparagraph after the effective date of the final regulations 

promulgated under paragraph (3)(A). 

‘‘(2) INFORMATION DESCRIBED.— ‘‘(A) IN GENERAL.—The following information is 

described in this paragraph: 

‘‘(i) The information described in subsections (a) 

and (b), subject to subparagraph (C). 

‘‘(ii) The identity of and information on— 

‘‘(I) each member of the governing body of 

the facility, including the name, title, and period 

of service of each such member; 

‘‘(II) each person or entity who is an officer, 

director, member, partner, trustee, or managing 

employee of the facility, including the name, title, 

and period of service of each such person or entity; 

and 

‘‘(III) each person or entity who is an additional disclosable party of the facility. 

‘‘(iii) The organizational structure of each additional disclosable party of the facility and a description 

of the relationship of each such additional disclosable 

party to the facility and to one another. 

‘‘(B) SPECIAL RULE WHERE INFORMATION IS ALREADY

REPORTED OR SUBMITTED.—To the extent that information 

reported by a facility to the Internal Revenue Service on 

Form 990, information submitted by a facility to the Securities and Exchange Commission, or information otherwise 

submitted to the Secretary or any other Federal agency 

contains the information described in clauses (i), (ii), or 

(iii) of subparagraph (A), the facility may provide such 

Form or such information submitted to meet the requirements of paragraph (1). 

‘‘(C) SPECIAL RULE.—In applying subparagraph (A)(i)— 

‘‘(i) with respect to subsections (a) and (b), ‘ownership or control interest’ shall include direct or indirect 

interests, including such interests in intermediate entities; and 

‘‘(ii) subsection (a)(3)(A)(ii) shall include the owner 

of a whole or part interest in any mortgage, deed 

of trust, note, or other obligation secured, in whole 

or in part, by the entity or any of the property or 

assets thereof, if the interest is equal to or exceeds 

5 percent of the total property or assets of the entirety. 

‘‘(3) REPORTING.— ‘‘(A) IN GENERAL.—Not later than the date that is 

2 years after the date of the enactment of this subsection, 

the Secretary shall promulgate final regulations requiring, 

effective on the date that is 90 days after the date on 

which such final regulations are published in the Federal 

Register, a facility to report the information described in 
H. R. 3590—583 

paragraph (2) to the Secretary in a standardized format, 

and such other regulations as are necessary to carry out 

this subsection. Such final regulations shall ensure that 

the facility certifies, as a condition of participation and 

payment under the program under title XVIII or XIX, 

that the information reported by the facility in accordance 

with such final regulations is, to the best of the facility’s 

knowledge, accurate and current. 

‘‘(B) GUIDANCE.—The Secretary shall provide guidance 

and technical assistance to States on how to adopt the 

standardized format under subparagraph (A). 

‘‘(4) NO EFFECT ON EXISTING REPORTING REQUIREMENTS.— 

Nothing in this subsection shall reduce, diminish, or alter any 

reporting requirement for a facility that is in effect as of the 

date of the enactment of this subsection. 

‘‘(5) DEFINITIONS.—In this subsection: 

‘‘(A) ADDITIONAL DISCLOSABLE PARTY.—The term ‘additional disclosable party’ means, with respect to a facility, 

any person or entity who— 

‘‘(i) exercises operational, financial, or managerial 

control over the facility or a part thereof, or provides 

policies or procedures for any of the operations of the 

facility, or provides financial or cash management services to the facility; 

‘‘(ii) leases or subleases real property to the facility, 

or owns a whole or part interest equal to or exceeding 

5 percent of the total value of such real property; 

or 

‘‘(iii) provides management or administrative services, management or clinical consulting services, or 

accounting or financial services to the facility. 

‘‘(B) FACILITY.—The term ‘facility’ means a disclosing 

entity which is— 

‘‘(i) a skilled nursing facility (as defined in section 

1819(a)); or 

‘‘(ii) a nursing facility (as defined in section 

1919(a)). 

‘‘(C) MANAGING EMPLOYEE.—The term ‘managing 

employee’ means, with respect to a facility, an individual 

(including a general manager, business manager, administrator, director, or consultant) who directly or indirectly 

manages, advises, or supervises any element of the practices, finances, or operations of the facility. 

‘‘(D) ORGANIZATIONAL STRUCTURE.—The term ‘organizational structure’ means, in the case of— 

‘‘(i) a corporation, the officers, directors, and shareholders of the corporation who have an ownership 

interest in the corporation which is equal to or exceeds 

5 percent; 

‘‘(ii) a limited liability company, the members and 

managers of the limited liability company (including, 

as applicable, what percentage each member and manager has of the ownership interest in the limited 

liability company); 

‘‘(iii) a general partnership, the partners of the 

general partnership; 
H. R. 3590—584 

‘‘(iv) a limited partnership, the general partners 

and any limited partners of the limited partnership 

who have an ownership interest in the limited partnership which is equal to or exceeds 10 percent; 

‘‘(v) a trust, the trustees of the trust; 

‘‘(vi) an individual, contact information for the individual; and 

‘‘(vii) any other person or entity, such information 

as the Secretary determines appropriate.’’. 

(b) PUBLIC AVAILABILITY OF INFORMATION.—Not later than the 

date that is 1 year after the date on which the final regulations 

promulgated under section 1124(c)(3)(A) of the Social Security Act, 

as added by subsection (a), are published in the Federal Register, 

the Secretary of Health and Human Services shall make the 

information reported in accordance with such final regulations available to the public in accordance with procedures established by 

the Secretary. 

(c) CONFORMING AMENDMENTS.— 

(1) IN GENERAL.— 

(A) SKILLED NURSING FACILITIES.—Section 1819(d)(1) 

of the Social Security Act (42 U.S.C. 1395i–3(d)(1)) is 

amended by striking subparagraph (B) and redesignating 

subparagraph (C) as subparagraph (B). 

(B) NURSING FACILITIES.—Section 1919(d)(1) of the 

Social Security Act (42 U.S.C. 1396r(d)(1)) is amended by 

striking subparagraph (B) and redesignating subparagraph 

(C) as subparagraph (B). 

(2) EFFECTIVE DATE.—The amendments made by paragraph 

(1) shall take effect on the date on which the Secretary makes 

the information described in subsection (b)(1) available to the 

public under such subsection. 

SEC. 6102. ACCOUNTABILITY REQUIREMENTS FOR SKILLED NURSING 

FACILITIES AND NURSING FACILITIES. 

Part A of title XI of the Social Security Act (42 U.S.C. 1301 

et seq.), as amended by sections 6002 and 6004, is amended by 

inserting after section 1128H the following new section: 

‘‘SEC. 1128I. ACCOUNTABILITY REQUIREMENTS FOR FACILITIES. 

‘‘(a) DEFINITION OF FACILITY.—In this section, the term ‘facility’ 

means— 

‘‘(1) a skilled nursing facility (as defined in section 1819(a)); 

or 

‘‘(2) a nursing facility (as defined in section 1919(a)). 

‘‘(b) EFFECTIVE COMPLIANCE AND ETHICS PROGRAMS.— 

‘‘(1) REQUIREMENT.—On or after the date that is 36 months 

after the date of the enactment of this section, a facility shall, 

with respect to the entity that operates the facility (in this 

subparagraph referred to as the ‘operating organization’ or 

‘organization’), have in operation a compliance and ethics program that is effective in preventing and detecting criminal, 

civil, and administrative violations under this Act and in promoting quality of care consistent with regulations developed 

under paragraph (2). 

‘‘(2) DEVELOPMENT OF REGULATIONS.— 

‘‘(A) IN GENERAL.—Not later than the date that is 

2 years after such date of the enactment, the Secretary, 
H. R. 3590—585 

working jointly with the Inspector General of the Department of Health and Human Services, shall promulgate 

regulations for an effective compliance and ethics program 

for operating organizations, which may include a model 

compliance program. 

‘‘(B) DESIGN OF REGULATIONS.—Such regulations with 

respect to specific elements or formality of a program shall, 

in the case of an organization that operates 5 or more 

facilities, vary with the size of the organization, such that 

larger organizations should have a more formal program 

and include established written policies defining the standards and procedures to be followed by its employees. Such 

requirements may specifically apply to the corporate level 

management of multi unit nursing home chains. 

‘‘(C) EVALUATION.—Not later than 3 years after the 

date of the promulgation of regulations under this paragraph, the Secretary shall complete an evaluation of the 

compliance and ethics programs required to be established 

under this subsection. Such evaluation shall determine if 

such programs led to changes in deficiency citations, 

changes in quality performance, or changes in other metrics 

of patient quality of care. The Secretary shall submit to 

Congress a report on such evaluation and shall include 

in such report such recommendations regarding changes 

in the requirements for such programs as the Secretary 

determines appropriate. 

‘‘(3) REQUIREMENTS FOR COMPLIANCE AND ETHICS PRO- GRAMS.—In this subsection, the term ‘compliance and ethics 

program’ means, with respect to a facility, a program of the 

operating organization that— 

‘‘(A) has been reasonably designed, implemented, and 

enforced so that it generally will be effective in preventing 

and detecting criminal, civil, and administrative violations 

under this Act and in promoting quality of care; and 

‘‘(B) includes at least the required components specified 

in paragraph (4). 

‘‘(4) REQUIRED COMPONENTS OF PROGRAM.—The required 

components of a compliance and ethics program of an operating 

organization are the following: 

‘‘(A) The organization must have established compliance standards and procedures to be followed by its 

employees and other agents that are reasonably capable 

of reducing the prospect of criminal, civil, and administrative violations under this Act. 

‘‘(B) Specific individuals within high-level personnel 

of the organization must have been assigned overall responsibility to oversee compliance with such standards and 

procedures and have sufficient resources and authority to 

assure such compliance. 

‘‘(C) The organization must have used due care not 

to delegate substantial discretionary authority to individuals whom the organization knew, or should have known 

through the exercise of due diligence, had a propensity 

to engage in criminal, civil, and administrative violations 

under this Act. 

‘‘(D) The organization must have taken steps to communicate effectively its standards and procedures to all 
H. R. 3590—586 

employees and other agents, such as by requiring participation in training programs or by disseminating publications 

that explain in a practical manner what is required. 

‘‘(E) The organization must have taken reasonable 

steps to achieve compliance with its standards, such as 

by utilizing monitoring and auditing systems reasonably 

designed to detect criminal, civil, and administrative violations under this Act by its employees and other agents 

and by having in place and publicizing a reporting system 

whereby employees and other agents could report violations 

by others within the organization without fear of retribution. 

‘‘(F) The standards must have been consistently 

enforced through appropriate disciplinary mechanisms, 

including, as appropriate, discipline of individuals responsible for the failure to detect an offense. 

‘‘(G) After an offense has been detected, the organization must have taken all reasonable steps to respond appropriately to the offense and to prevent further similar 

offenses, including any necessary modification to its program to prevent and detect criminal, civil, and administrative violations under this Act. 

‘‘(H) The organization must periodically undertake 

reassessment of its compliance program to identify changes 

necessary to reflect changes within the organization and 

its facilities. 

‘‘(c) QUALITY ASSURANCE AND PERFORMANCE IMPROVEMENT PRO- GRAM.— ‘‘(1) IN GENERAL.—Not later than December 31, 2011, the 

Secretary shall establish and implement a quality assurance 

and performance improvement program (in this subparagraph 

referred to as the ‘QAPI program’) for facilities, including multi 

unit chains of facilities. Under the QAPI program, the Secretary 

shall establish standards relating to quality assurance and 

performance improvement with respect to facilities and provide 

technical assistance to facilities on the development of best 

practices in order to meet such standards. Not later than 1 

year after the date on which the regulations are promulgated 

under paragraph (2), a facility must submit to the Secretary 

a plan for the facility to meet such standards and implement 

such best practices, including how to coordinate the 

implementation of such plan with quality assessment and 

assurance activities conducted under sections 1819(b)(1)(B) and 

1919(b)(1)(B), as applicable. 

‘‘(2) REGULATIONS.—The Secretary shall promulgate regulations to carry out this subsection.’’. 

SEC. 6103. NURSING HOME COMPARE MEDICARE WEBSITE. 

(a) SKILLED NURSING FACILITIES.— (1) IN GENERAL.—Section 1819 of the Social Security Act 

(42 U.S.C. 1395i–3) is amended— 

(A) by redesignating subsection (i) as subsection (j); 

and 

(B) by inserting after subsection (h) the following new 

subsection: 

‘‘(i) NURSING HOME COMPARE WEBSITE.— 

‘‘(1) INCLUSION OF ADDITIONAL INFORMATION.— 
H. R. 3590—587 

‘‘(A) IN GENERAL.—The Secretary shall ensure that the 

Department of Health and Human Services includes, as 

part of the information provided for comparison of nursing 

homes on the official Internet website of the Federal 

Government for Medicare beneficiaries (commonly referred 

to as the ‘Nursing Home Compare’ Medicare website) (or 

a successor website), the following information in a manner 

that is prominent, updated on a timely basis, easily accessible, readily understandable to consumers of long-term 

care services, and searchable: 

‘‘(i) Staffing data for each facility (including resident census data and data on the hours of care provided per resident per day) based on data submitted 

under section 1128I(g), including information on 

staffing turnover and tenure, in a format that is clearly 

understandable to consumers of long-term care services 

and allows such consumers to compare differences in 

staffing between facilities and State and national averages for the facilities. Such format shall include— 

‘‘(I) concise explanations of how to interpret 

the data (such as a plain English explanation of 

data reflecting ‘nursing home staff hours per resident day’); 

‘‘(II) differences in types of staff (such as 

training associated with different categories of 

staff); 

‘‘(III) the relationship between nurse staffing 

levels and quality of care; and 

‘‘(IV) an explanation that appropriate staffing 

levels vary based on patient case mix. 

‘‘(ii) Links to State Internet websites with information regarding State survey and certification programs, 

links to Form 2567 State inspection reports (or a successor form) on such websites, information to guide 

consumers in how to interpret and understand such 

reports, and the facility plan of correction or other 

response to such report. Any such links shall be posted 

on a timely basis. 

‘‘(iii) The standardized complaint form developed 

under section 1128I(f), including explanatory material 

on what complaint forms are, how they are used, and 

how to file a complaint with the State survey and 

certification program and the State long-term care 

ombudsman program. 

‘‘(iv) Summary information on the number, type, 

severity, and outcome of substantiated complaints. 

‘‘(v) The number of adjudicated instances of 

criminal violations by a facility or the employees of 

a facility— 

‘‘(I) that were committed inside the facility; 

‘‘(II) with respect to such instances of violations or crimes committed inside of the facility 

that were the violations or crimes of abuse, neglect, 

and exploitation, criminal sexual abuse, or other 

violations or crimes that resulted in serious bodily 

injury; and 
H. R. 3590—588 

‘‘(III) the number of civil monetary penalties 

levied against the facility, employees, contractors, 

and other agents. 

‘‘(B) DEADLINE FOR PROVISION OF INFORMATION.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), the Secretary shall ensure that the information 

described in subparagraph (A) is included on such 

website (or a successor website) not later than 1 year 

after the date of the enactment of this subsection. 

‘‘(ii) EXCEPTION.—The Secretary shall ensure that 

the information described in subparagraph (A)(i) is 

included on such website (or a successor website) not 

later than the date on which the requirements under 

section 1128I(g) are implemented. 

‘‘(2) REVIEW AND MODIFICATION OF WEBSITE.— 

‘‘(A) IN GENERAL.—The Secretary shall establish a 

process— 

‘‘(i) to review the accuracy, clarity of presentation, 

timeliness, and comprehensiveness of information 

reported on such website as of the day before the 

date of the enactment of this subsection; and 

‘‘(ii) not later than 1 year after the date of the 

enactment of this subsection, to modify or revamp such 

website in accordance with the review conducted under 

clause (i). 

‘‘(B) CONSULTATION.—In conducting the review under 

subparagraph (A)(i), the Secretary shall consult with— 

‘‘(i) State long-term care ombudsman programs; 

‘‘(ii) consumer advocacy groups; 

‘‘(iii) provider stakeholder groups; and 

‘‘(iv) any other representatives of programs or 

groups the Secretary determines appropriate.’’. 

(2) TIMELINESS OF SUBMISSION OF SURVEY AND CERTIFI- CATION INFORMATION.— (A) IN GENERAL.—Section 1819(g)(5) of the Social Security Act (42 U.S.C. 1395i–3(g)(5)) is amended by adding 

at the end the following new subparagraph: 

‘‘(E) SUBMISSION OF SURVEY AND CERTIFICATION

INFORMATION TO THE SECRETARY.—In order to improve the 

timeliness of information made available to the public 

under subparagraph (A) and provided on the Nursing Home 

Compare Medicare website under subsection (i), each State 

shall submit information respecting any survey or certification made respecting a skilled nursing facility (including 

any enforcement actions taken by the State) to the Secretary not later than the date on which the State sends 

such information to the facility. The Secretary shall use 

the information submitted under the preceding sentence 

to update the information provided on the Nursing Home 

Compare Medicare website as expeditiously as practicable 

but not less frequently than quarterly.’’. 

(B) EFFECTIVE DATE.—The amendment made by this 

paragraph shall take effect 1 year after the date of the 

enactment of this Act. 

(3) SPECIAL FOCUS FACILITY PROGRAM.—Section 1819(f) of 

the Social Security Act (42 U.S.C. 1395i–3(f)) is amended by 

adding at the end the following new paragraph: 
H. R. 3590—589 

‘‘(8) SPECIAL FOCUS FACILITY PROGRAM.— 

‘‘(A) IN GENERAL.—The Secretary shall conduct a special focus facility program for enforcement of requirements 

for skilled nursing facilities that the Secretary has identified as having substantially failed to meet applicable 

requirement of this Act. 

‘‘(B) PERIODIC SURVEYS.—Under such program the Secretary shall conduct surveys of each facility in the program 

not less than once every 6 months.’’. 

(b) NURSING FACILITIES.— 

(1) IN GENERAL.—Section 1919 of the Social Security Act 

(42 U.S.C. 1396r) is amended— 

(A) by redesignating subsection (i) as subsection (j); 

and 

(B) by inserting after subsection (h) the following new 

subsection: 

‘‘(i) NURSING HOME COMPARE WEBSITE.— 

‘‘(1) INCLUSION OF ADDITIONAL INFORMATION.— 

‘‘(A) IN GENERAL.—The Secretary shall ensure that the 

Department of Health and Human Services includes, as 

part of the information provided for comparison of nursing 

homes on the official Internet website of the Federal 

Government for Medicare beneficiaries (commonly referred 

to as the ‘Nursing Home Compare’ Medicare website) (or 

a successor website), the following information in a manner 

that is prominent, updated on a timely basis, easily accessible, readily understandable to consumers of long-term 

care services, and searchable: 

‘‘(i) Staffing data for each facility (including resident census data and data on the hours of care provided per resident per day) based on data submitted 

under section 1128I(g), including information on 

staffing turnover and tenure, in a format that is clearly 

understandable to consumers of long-term care services 

and allows such consumers to compare differences in 

staffing between facilities and State and national averages for the facilities. Such format shall include— 

‘‘(I) concise explanations of how to interpret 

the data (such as plain English explanation of 

data reflecting ‘nursing home staff hours per resident day’); 

‘‘(II) differences in types of staff (such as 

training associated with different categories of 

staff); 

‘‘(III) the relationship between nurse staffing 

levels and quality of care; and 

‘‘(IV) an explanation that appropriate staffing 

levels vary based on patient case mix. 

‘‘(ii) Links to State Internet websites with information regarding State survey and certification programs, 

links to Form 2567 State inspection reports (or a successor form) on such websites, information to guide 

consumers in how to interpret and understand such 

reports, and the facility plan of correction or other 

response to such report. Any such links shall be posted 

on a timely basis. 
H. R. 3590—590 

‘‘(iii) The standardized complaint form developed 

under section 1128I(f), including explanatory material 

on what complaint forms are, how they are used, and 

how to file a complaint with the State survey and 

certification program and the State long-term care 

ombudsman program. 

‘‘(iv) Summary information on the number, type, 

severity, and outcome of substantiated complaints. 

‘‘(v) The number of adjudicated instances of 

criminal violations by a facility or the employees of 

a facility— 

‘‘(I) that were committed inside of the facility; 

and 

‘‘(II) with respect to such instances of violations or crimes committed outside of the facility, 

that were violations or crimes that resulted in 

the serious bodily injury of an elder. 

‘‘(B) DEADLINE FOR PROVISION OF INFORMATION.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), the Secretary shall ensure that the information 

described in subparagraph (A) is included on such 

website (or a successor website) not later than 1 year 

after the date of the enactment of this subsection. 

‘‘(ii) EXCEPTION.—The Secretary shall ensure that 

the information described in subparagraph (A)(i) is 

included on such website (or a successor website) not 

later than the date on which the requirements under 

section 1128I(g) are implemented. 

‘‘(2) REVIEW AND MODIFICATION OF WEBSITE.— 

‘‘(A) IN GENERAL.—The Secretary shall establish a 

process— 

‘‘(i) to review the accuracy, clarity of presentation, 

timeliness, and comprehensiveness of information 

reported on such website as of the day before the 

date of the enactment of this subsection; and 

‘‘(ii) not later than 1 year after the date of the 

enactment of this subsection, to modify or revamp such 

website in accordance with the review conducted under 

clause (i). 

‘‘(B) CONSULTATION.—In conducting the review under 

subparagraph (A)(i), the Secretary shall consult with— 

‘‘(i) State long-term care ombudsman programs; 

‘‘(ii) consumer advocacy groups; 

‘‘(iii) provider stakeholder groups; 

‘‘(iv) skilled nursing facility employees and their 

representatives; and 

‘‘(v) any other representatives of programs or 

groups the Secretary determines appropriate.’’. 

(2) TIMELINESS OF SUBMISSION OF SURVEY AND CERTIFICATION INFORMATION.— 

(A) IN GENERAL.—Section 1919(g)(5) of the Social Security Act (42 U.S.C. 1396r(g)(5)) is amended by adding at 

the end the following new subparagraph: 

‘‘(E) SUBMISSION OF SURVEY AND CERTIFICATION

INFORMATION TO THE SECRETARY.—In order to improve the 

timeliness of information made available to the public 

under subparagraph (A) and provided on the Nursing Home 
H. R. 3590—591 

Compare Medicare website under subsection (i), each State 

shall submit information respecting any survey or certification made respecting a nursing facility (including any 

enforcement actions taken by the State) to the Secretary 

not later than the date on which the State sends such 

information to the facility. The Secretary shall use the 

information submitted under the preceding sentence to 

update the information provided on the Nursing Home 

Compare Medicare website as expeditiously as practicable 

but not less frequently than quarterly.’’. 

(B) EFFECTIVE DATE.—The amendment made by this 

paragraph shall take effect 1 year after the date of the 

enactment of this Act. 

(3) SPECIAL FOCUS FACILITY PROGRAM.—Section 1919(f) of 

the Social Security Act (42 U.S.C. 1396r(f)) is amended by 

adding at the end of the following new paragraph: 

‘‘(10) SPECIAL FOCUS FACILITY PROGRAM.— 

‘‘(A) IN GENERAL.—The Secretary shall conduct a special focus facility program for enforcement of requirements 

for nursing facilities that the Secretary has identified as 

having substantially failed to meet applicable requirements 

of this Act. 

‘‘(B) PERIODIC SURVEYS.—Under such program the Secretary shall conduct surveys of each facility in the program 

not less often than once every 6 months.’’. 

(c) AVAILABILITY OF REPORTS ON SURVEYS, CERTIFICATIONS, AND

COMPLAINT INVESTIGATIONS.— 

(1) SKILLED NURSING FACILITIES.—Section 1819(d)(1) of the 

Social Security Act (42 U.S.C. 1395i–3(d)(1)), as amended by 

section 6101, is amended by adding at the end the following 

new subparagraph: 

‘‘(C) AVAILABILITY OF SURVEY, CERTIFICATION, AND COMPLAINT INVESTIGATION REPORTS.—A skilled nursing facility 

must— 

‘‘(i) have reports with respect to any surveys, certifications, and complaint investigations made 

respecting the facility during the 3 preceding years 

available for any individual to review upon request; 

and 

‘‘(ii) post notice of the availability of such reports 

in areas of the facility that are prominent and accessible to the public. 

The facility shall not make available under clause (i) identifying information about complainants or residents.’’. 

(2) NURSING FACILITIES.—Section 1919(d)(1) of the Social 

Security Act (42 U.S.C. 1396r(d)(1)), as amended by section 

6101, is amended by adding at the end the following new 

subparagraph: 

‘‘(V) AVAILABILITY OF SURVEY, CERTIFICATION, AND COMPLAINT INVESTIGATION REPORTS.—A nursing facility must— 

‘‘(i) have reports with respect to any surveys, certifications, and complaint investigations made 

respecting the facility during the 3 preceding years 

available for any individual to review upon request; 

and 
H. R. 3590—592 

‘‘(ii) post notice of the availability of such reports 

in areas of the facility that are prominent and accessible to the public. 

The facility shall not make available under clause (i) identifying information about complainants or residents.’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall take effect 1 year after the date of the enactment 

of this Act. 

(d) GUIDANCE TO STATES ON FORM 2567 STATE INSPECTION

REPORTS AND COMPLAINT INVESTIGATION REPORTS.— (1) GUIDANCE.—The Secretary of Health and Human Services (in this subtitle referred to as the ‘‘Secretary’’) shall provide 

guidance to States on how States can establish electronic links 

to Form 2567 State inspection reports (or a successor form), 

complaint investigation reports, and a facility’s plan of correction or other response to such Form 2567 State inspection 

reports (or a successor form) on the Internet website of the 

State that provides information on skilled nursing facilities 

and nursing facilities and the Secretary shall, if possible, 

include such information on Nursing Home Compare. 

(2) REQUIREMENT.—Section 1902(a)(9) of the Social Security 

Act (42 U.S.C. 1396a(a)(9)) is amended— 

(A) by striking ‘‘and’’ at the end of subparagraph (B); 

(B) by striking the semicolon at the end of subparagraph (C) and inserting ‘‘, and’’; and 

(C) by adding at the end the following new subparagraph: 

‘‘(D) that the State maintain a consumer-oriented 

website providing useful information to consumers 

regarding all skilled nursing facilities and all nursing facilities in the State, including for each facility, Form 2567 

State inspection reports (or a successor form), complaint 

investigation reports, the facility’s plan of correction, and 

such other information that the State or the Secretary 

considers useful in assisting the public to assess the quality 

of long term care options and the quality of care provided 

by individual facilities;’’. 

(3) DEFINITIONS.—In this subsection: 

(A) NURSING FACILITY.—The term ‘‘nursing facility’’ has 

the meaning given such term in section 1919(a) of the 

Social Security Act (42 U.S.C. 1396r(a)). 

(B) SECRETARY.—The term ‘‘Secretary’’ means the Secretary of Health and Human Services. 

(C) SKILLED NURSING FACILITY.—The term ‘‘skilled 

nursing facility’’ has the meaning given such term in section 1819(a) of the Social Security Act (42 U.S.C. 1395i– 

3(a)). 

(e) DEVELOPMENT OF CONSUMER RIGHTS INFORMATION PAGE

ON NURSING HOME COMPARE WEBSITE.—Not later than 1 year 

after the date of enactment of this Act, the Secretary shall ensure 

that the Department of Health and Human Services, as part of 

the information provided for comparison of nursing facilities on 

the Nursing Home Compare Medicare website develops and includes 

a consumer rights information page that contains links to descriptions of, and information with respect to, the following: 

(1) The documentation on nursing facilities that is available 

to the public. 
H. R. 3590—593 

(2) General information and tips on choosing a nursing 

facility that meets the needs of the individual. 

(3) General information on consumer rights with respect 

to nursing facilities. 

(4) The nursing facility survey process (on a national and 

State-specific basis). 

(5) On a State-specific basis, the services available through 

the State long-term care ombudsman for such State. 

SEC. 6104. REPORTING OF EXPENDITURES. 

Section 1888 of the Social Security Act (42 U.S.C. 1395yy) 

is amended by adding at the end the following new subsection: 

‘‘(f) REPORTING OF DIRECT CARE EXPENDITURES.— ‘‘(1) IN GENERAL.—For cost reports submitted under this 

title for cost reporting periods beginning on or after the date 

that is 2 years after the date of the enactment of this subsection, 

skilled nursing facilities shall separately report expenditures 

for wages and benefits for direct care staff (breaking out (at 

a minimum) registered nurses, licensed professional nurses, 

certified nurse assistants, and other medical and therapy staff). 

‘‘(2) MODIFICATION OF FORM.—The Secretary, in consultation with private sector accountants experienced with Medicare 

and Medicaid nursing facility home cost reports, shall redesign 

such reports to meet the requirement of paragraph (1) not 

later than 1 year after the date of the enactment of this subsection. 

‘‘(3) CATEGORIZATION BY FUNCTIONAL ACCOUNTS.—Not later 

than 30 months after the date of the enactment of this subsection, the Secretary, working in consultation with the Medicare Payment Advisory Commission, the Medicaid and CHIP 

Payment and Access Commission, the Inspector General of 

the Department of Health and Human Services, and other 

expert parties the Secretary determines appropriate, shall take 

the expenditures listed on cost reports, as modified under paragraph (1), submitted by skilled nursing facilities and categorize 

such expenditures, regardless of any source of payment for 

such expenditures, for each skilled nursing facility into the 

following functional accounts on an annual basis: 

‘‘(A) Spending on direct care services (including 

nursing, therapy, and medical services). 

‘‘(B) Spending on indirect care (including housekeeping 

and dietary services). 

‘‘(C) Capital assets (including building and land costs). 

‘‘(D) Administrative services costs. 

‘‘(4) AVAILABILITY OF INFORMATION SUBMITTED.—The Secretary shall establish procedures to make information on 

expenditures submitted under this subsection readily available 

to interested parties upon request, subject to such requirements 

as the Secretary may specify under the procedures established 

under this paragraph.’’. 

SEC. 6105. STANDARDIZED COMPLAINT FORM. 

(a) IN GENERAL.—Section 1128I of the Social Security Act, 

as added and amended by this Act, is amended by adding at 

the end the following new subsection: 

‘‘(f) STANDARDIZED COMPLAINT FORM.— 

‘‘(1) DEVELOPMENT BY THE SECRETARY.—The Secretary shall 

develop a standardized complaint form for use by a resident 
H. R. 3590—594 

(or a person acting on the resident’s behalf) in filing a complaint 

with a State survey and certification agency and a State longterm care ombudsman program with respect to a facility. 

‘‘(2) COMPLAINT FORMS AND RESOLUTION PROCESSES.— 

‘‘(A) COMPLAINT FORMS.—The State must make the 

standardized complaint form developed under paragraph 

(1) available upon request to— 

‘‘(i) a resident of a facility; and 

‘‘(ii) any person acting on the resident’s behalf. 

‘‘(B) COMPLAINT RESOLUTION PROCESS.—The State must 

establish a complaint resolution process in order to ensure 

that the legal representative of a resident of a facility 

or other responsible party is not denied access to such 

resident or otherwise retaliated against if they have complained about the quality of care provided by the facility 

or other issues relating to the facility. Such complaint 

resolution process shall include— 

‘‘(i) procedures to assure accurate tracking of complaints received, including notification to the complainant that a complaint has been received; 

‘‘(ii) procedures to determine the likely severity 

of a complaint and for the investigation of the complaint; and 

‘‘(iii) deadlines for responding to a complaint and 

for notifying the complainant of the outcome of the 

investigation. 

‘‘(3) RULE OF CONSTRUCTION.—Nothing in this subsection 

shall be construed as preventing a resident of a facility (or 

a person acting on the resident’s behalf) from submitting a 

complaint in a manner or format other than by using the 

standardized complaint form developed under paragraph (1) 

(including submitting a complaint orally).’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect 1 year after the date of the enactment of this 

Act. 

SEC. 6106. ENSURING STAFFING ACCOUNTABILITY. 

Section 1128I of the Social Security Act, as added and amended 

by this Act, is amended by adding at the end the following new 

subsection: 

‘‘(g) SUBMISSION OF STAFFING INFORMATION BASED ON PAYROLL

DATA IN A UNIFORM FORMAT.—Beginning not later than 2 years 

after the date of the enactment of this subsection, and after consulting with State long-term care ombudsman programs, consumer 

advocacy groups, provider stakeholder groups, employees and their 

representatives, and other parties the Secretary deems appropriate, 

the Secretary shall require a facility to electronically submit to 

the Secretary direct care staffing information (including information 

with respect to agency and contract staff) based on payroll and 

other verifiable and auditable data in a uniform format (according 

to specifications established by the Secretary in consultation with 

such programs, groups, and parties). Such specifications shall 

require that the information submitted under the preceding sentence— 

‘‘(1) specify the category of work a certified employee performs (such as whether the employee is a registered nurse, 
H. R. 3590—595 

licensed practical nurse, licensed vocational nurse, certified 

nursing assistant, therapist, or other medical personnel); 

‘‘(2) include resident census data and information on resident case mix; 

‘‘(3) include a regular reporting schedule; and 

‘‘(4) include information on employee turnover and tenure 

and on the hours of care provided by each category of certified 

employees referenced in paragraph (1) per resident per day. 

Nothing in this subsection shall be construed as preventing the 

Secretary from requiring submission of such information with 

respect to specific categories, such as nursing staff, before other 

categories of certified employees. Information under this subsection 

with respect to agency and contract staff shall be kept separate 

from information on employee staffing.’’. 

SEC. 6107. GAO STUDY AND REPORT ON FIVE-STAR QUALITY RATING 

SYSTEM. 

(a) STUDY.—The Comptroller General of the United States (in 

this section referred to as the ‘‘Comptroller General’’) shall conduct 

a study on the Five-Star Quality Rating System for nursing homes 

of the Centers for Medicare & Medicaid Services. Such study shall 

include an analysis of— 

(1) how such system is being implemented; 

(2) any problems associated with such system or its 

implementation; and 

(3) how such system could be improved. 

(b) REPORT.—Not later than 2 years after the date of enactment 

of this Act, the Comptroller General shall submit to Congress a 

report containing the results of the study conducted under subsection (a), together with recommendations for such legislation and 

administrative action as the Comptroller General determines appropriate. 

PART II—TARGETING ENFORCEMENT 

SEC. 6111. CIVIL MONEY PENALTIES. 

(a) SKILLED NURSING FACILITIES.— (1) IN GENERAL.—Section 1819(h)(2)(B)(ii) of the Social 

Security Act (42 U.S.C. 1395i–3(h)(2)(B)(ii)) is amended— 

(A) by striking ‘‘PENALTIES.—The Secretary’’ and 

inserting ‘‘PENALTIES.— 

‘‘(I) IN GENERAL.—Subject to subclause (II), 

the Secretary’’; and 

(B) by adding at the end the following new subclauses: 

‘‘(II) REDUCTION OF CIVIL MONEY PENALTIES

IN CERTAIN CIRCUMSTANCES.—Subject to subclause 

(III), in the case where a facility self-reports and 

promptly corrects a deficiency for which a penalty 

was imposed under this clause not later than 10 

calendar days after the date of such imposition, 

the Secretary may reduce the amount of the penalty imposed by not more than 50 percent. 

‘‘(III) PROHIBITIONS ON REDUCTION FOR CERTAIN DEFICIENCIES.— 

‘‘(aa) REPEAT DEFICIENCIES.—The Secretary may not reduce the amount of a penalty 

under subclause (II) if the Secretary had 
H. R. 3590—596 

reduced a penalty imposed on the facility in 

the preceding year under such subclause with 

respect to a repeat deficiency. 

‘‘(bb) CERTAIN OTHER DEFICIENCIES.—The 

Secretary may not reduce the amount of a 

penalty under subclause (II) if the penalty 

is imposed on the facility for a deficiency that 

is found to result in a pattern of harm or 

widespread harm, immediately jeopardizes the 

health or safety of a resident or residents of 

the facility, or results in the death of a resident of the facility. 

‘‘(IV) COLLECTION OF CIVIL MONEY PENALTIES.—In the case of a civil money penalty 

imposed under this clause, the Secretary shall 

issue regulations that— 

‘‘(aa) subject to item (cc), not later than 

30 days after the imposition of the penalty, 

provide for the facility to have the opportunity 

to participate in an independent informal dispute resolution process which generates a 

written record prior to the collection of such 

penalty; 

‘‘(bb) in the case where the penalty is 

imposed for each day of noncompliance, provide that a penalty may not be imposed for 

any day during the period beginning on the 

initial day of the imposition of the penalty 

and ending on the day on which the informal 

dispute resolution process under item (aa) is 

completed; 

‘‘(cc) may provide for the collection of such 

civil money penalty and the placement of such 

amounts collected in an escrow account under 

the direction of the Secretary on the earlier 

of the date on which the informal dispute resolution process under item (aa) is completed 

or the date that is 90 days after the date 

of the imposition of the penalty; 

‘‘(dd) may provide that such amounts collected are kept in such account pending the 

resolution of any subsequent appeals; 

‘‘(ee) in the case where the facility successfully appeals the penalty, may provide for the 

return of such amounts collected (plus 

interest) to the facility; and 

‘‘(ff) in the case where all such appeals 

are unsuccessful, may provide that some portion of such amounts collected may be used 

to support activities that benefit residents, 

including assistance to support and protect 

residents of a facility that closes (voluntarily 

or involuntarily) or is decertified (including 

offsetting costs of relocating residents to home 

and community-based settings or another 

facility), projects that support resident and 
H. R. 3590—597 

family councils and other consumer involvement in assuring quality care in facilities, and 

facility improvement initiatives approved by 

the Secretary (including joint training of 

facility staff and surveyors, technical assistance for facilities implementing quality assurance programs, the appointment of temporary 

management firms, and other activities 

approved by the Secretary).’’. 

(2) CONFORMING AMENDMENT.—The second sentence of section 1819(h)(5) of the Social Security Act (42 U.S.C. 1395i– 

3(h)(5)) is amended by inserting ‘‘(ii)(IV),’’ after ‘‘(i),’’. 

(b) NURSING FACILITIES.— 

(1) IN GENERAL.—Section 1919(h)(3)(C)(ii) of the Social 

Security Act (42 U.S.C. 1396r(h)(3)(C)) is amended— 

(A) by striking ‘‘PENALTIES.—The Secretary’’ and 

inserting ‘‘PENALTIES.— 

‘‘(I) IN GENERAL.—Subject to subclause (II), 

the Secretary’’; and 

(B) by adding at the end the following new subclauses: 

‘‘(II) REDUCTION OF CIVIL MONEY PENALTIES

IN CERTAIN CIRCUMSTANCES.—Subject to subclause 

(III), in the case where a facility self-reports and 

promptly corrects a deficiency for which a penalty 

was imposed under this clause not later than 10 

calendar days after the date of such imposition, 

the Secretary may reduce the amount of the penalty imposed by not more than 50 percent. 

‘‘(III) PROHIBITIONS ON REDUCTION FOR CERTAIN DEFICIENCIES.— 

‘‘(aa) REPEAT DEFICIENCIES.—The Secretary may not reduce the amount of a penalty 

under subclause (II) if the Secretary had 

reduced a penalty imposed on the facility in 

the preceding year under such subclause with 

respect to a repeat deficiency. 

‘‘(bb) CERTAIN OTHER DEFICIENCIES.—The 

Secretary may not reduce the amount of a 

penalty under subclause (II) if the penalty 

is imposed on the facility for a deficiency that 

is found to result in a pattern of harm or 

widespread harm, immediately jeopardizes the 

health or safety of a resident or residents of 

the facility, or results in the death of a resident of the facility. 

‘‘(IV) COLLECTION OF CIVIL MONEY PENALTIES.—In the case of a civil money penalty 

imposed under this clause, the Secretary shall 

issue regulations that— 

‘‘(aa) subject to item (cc), not later than 

30 days after the imposition of the penalty, 

provide for the facility to have the opportunity 

to participate in an independent informal dispute resolution process which generates a 

written record prior to the collection of such 

penalty; 
H. R. 3590—598 

‘‘(bb) in the case where the penalty is 

imposed for each day of noncompliance, provide that a penalty may not be imposed for 

any day during the period beginning on the 

initial day of the imposition of the penalty 

and ending on the day on which the informal 

dispute resolution process under item (aa) is 

completed; 

‘‘(cc) may provide for the collection of such 

civil money penalty and the placement of such 

amounts collected in an escrow account under 

the direction of the Secretary on the earlier 

of the date on which the informal dispute resolution process under item (aa) is completed 

or the date that is 90 days after the date 

of the imposition of the penalty; 

‘‘(dd) may provide that such amounts collected are kept in such account pending the 

resolution of any subsequent appeals; 

‘‘(ee) in the case where the facility successfully appeals the penalty, may provide for the 

return of such amounts collected (plus 

interest) to the facility; and 

‘‘(ff) in the case where all such appeals 

are unsuccessful, may provide that some portion of such amounts collected may be used 

to support activities that benefit residents, 

including assistance to support and protect 

residents of a facility that closes (voluntarily 

or involuntarily) or is decertified (including 

offsetting costs of relocating residents to home 

and community-based settings or another 

facility), projects that support resident and 

family councils and other consumer involvement in assuring quality care in facilities, and 

facility improvement initiatives approved by 

the Secretary (including joint training of 

facility staff and surveyors, technical assistance for facilities implementing quality assurance programs, the appointment of temporary 

management firms, and other activities 

approved by the Secretary).’’. 

(2) CONFORMING AMENDMENT.—Section 1919(h)(5)(8) of the 

Social Security Act (42 U.S.C. 1396r(h)(5)(8)) is amended by 

inserting ‘‘(ii)(IV),’’ after ‘‘(i),’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect 1 year after the date of the enactment of this 

Act. 

SEC. 6112. NATIONAL INDEPENDENT MONITOR DEMONSTRATION 

PROJECT. 

(a) ESTABLISHMENT.— 

(1) IN GENERAL.—The Secretary, in consultation with the 

Inspector General of the Department of Health and Human 

Services, shall conduct a demonstration project to develop, test, 

and implement an independent monitor program to oversee 
H. R. 3590—599 

interstate and large intrastate chains of skilled nursing facilities and nursing facilities. 

(2) SELECTION.—The Secretary shall select chains of skilled 

nursing facilities and nursing facilities described in paragraph 

(1) to participate in the demonstration project under this section 

from among those chains that submit an application to the 

Secretary at such time, in such manner, and containing such 

information as the Secretary may require. 

(3) DURATION.—The Secretary shall conduct the demonstration project under this section for a 2-year period. 

(4) IMPLEMENTATION.—The Secretary shall implement the 

demonstration project under this section not later than 1 year 

after the date of the enactment of this Act. 

(b) REQUIREMENTS.—The Secretary shall evaluate chains 

selected to participate in the demonstration project under this section based on criteria selected by the Secretary, including where 

evidence suggests that a number of the facilities of the chain are 

experiencing serious safety and quality of care problems. Such 

criteria may include the evaluation of a chain that includes a 

number of facilities participating in the ‘‘Special Focus Facility’’ 

program (or a successor program) or multiple facilities with a record 

of repeated serious safety and quality of care deficiencies. 

(c) RESPONSIBILITIES.—An independent monitor that enters into 

a contract with the Secretary to participate in the conduct of the 

demonstration project under this section shall— 

(1) conduct periodic reviews and prepare root-cause quality 

and deficiency analyses of a chain to assess if facilities of 

the chain are in compliance with State and Federal laws and 

regulations applicable to the facilities; 

(2) conduct sustained oversight of the efforts of the chain, 

whether publicly or privately held, to achieve compliance by 

facilities of the chain with State and Federal laws and regulations applicable to the facilities; 

(3) analyze the management structure, distribution of 

expenditures, and nurse staffing levels of facilities of the chain 

in relation to resident census, staff turnover rates, and tenure; 

(4) report findings and recommendations with respect to 

such reviews, analyses, and oversight to the chain and facilities 

of the chain, to the Secretary, and to relevant States; and 

(5) publish the results of such reviews, analyses, and oversight. 

(d) IMPLEMENTATION OF RECOMMENDATIONS.— 

(1) RECEIPT OF FINDING BY CHAIN.—Not later than 10 days 

after receipt of a finding of an independent monitor under 

subsection (c)(4), a chain participating in the demonstration 

project shall submit to the independent monitor a report— 

(A) outlining corrective actions the chain will take 

to implement the recommendations in such report; or 

(B) indicating that the chain will not implement such 

recommendations, and why it will not do so. 

(2) RECEIPT OF REPORT BY INDEPENDENT MONITOR.—Not 

later than 10 days after receipt of a report submitted by a 

chain under paragraph (1), an independent monitor shall 

finalize its recommendations and submit a report to the chain 

and facilities of the chain, the Secretary, and the State or 

States, as appropriate, containing such final recommendations. 
H. R. 3590—600 

(e) COST OF APPOINTMENT.—A chain shall be responsible for 

a portion of the costs associated with the appointment of independent monitors under the demonstration project under this section. The chain shall pay such portion to the Secretary (in an 

amount and in accordance with procedures established by the Secretary). 

(f) WAIVER AUTHORITY.—The Secretary may waive such requirements of titles XVIII and XIX of the Social Security Act (42 U.S.C. 

1395 et seq.; 1396 et seq.) as may be necessary for the purpose 

of carrying out the demonstration project under this section. 

(g) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out 

this section. 

(h) DEFINITIONS.—In this section: 

(1) ADDITIONAL DISCLOSABLE PARTY.—The term ‘‘additional 

disclosable party’’ has the meaning given such term in section 

1124(c)(5)(A) of the Social Security Act, as added by section 

4201(a). 

(2) FACILITY.—The term ‘‘facility’’ means a skilled nursing 

facility or a nursing facility. 

(3) NURSING FACILITY.—The term ‘‘nursing facility’’ has 

the meaning given such term in section 1919(a) of the Social 

Security Act (42 U.S.C. 1396r(a)). 

(4) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services, acting through the Assistant 

Secretary for Planning and Evaluation. 

(5) SKILLED NURSING FACILITY.—The term ‘‘skilled nursing 

facility’’ has the meaning given such term in section 1819(a) 

of the Social Security Act (42 U.S.C. 1395(a)). 

(i) EVALUATION AND REPORT.— 

(1) EVALUATION.—The Secretary, in consultation with the 

Inspector General of the Department of Health and Human 

Services, shall evaluate the demonstration project conducted 

under this section. 

(2) REPORT.—Not later than 180 days after the completion 

of the demonstration project under this section, the Secretary 

shall submit to Congress a report containing the results of 

the evaluation conducted under paragraph (1), together with 

recommendations— 

(A) as to whether the independent monitor program 

should be established on a permanent basis; 

(B) if the Secretary recommends that such program 

be so established, on appropriate procedures and mechanisms for such establishment; and 

(C) for such legislation and administrative action as 

the Secretary determines appropriate. 

SEC. 6113. NOTIFICATION OF FACILITY CLOSURE. 

(a) IN GENERAL.—Section 1128I of the Social Security Act, 

as added and amended by this Act, is amended by adding at 

the end the following new subsection: 

‘‘(h) NOTIFICATION OF FACILITY CLOSURE.— 

‘‘(1) IN GENERAL.—Any individual who is the administrator 

of a facility must— 
H. R. 3590—601 

‘‘(A) submit to the Secretary, the State long-term care 

ombudsman, residents of the facility, and the legal representatives of such residents or other responsible parties, 

written notification of an impending closure— 

‘‘(i) subject to clause (ii), not later than the date 

that is 60 days prior to the date of such closure; and 

‘‘(ii) in the case of a facility where the Secretary 

terminates the facility’s participation under this title, 

not later than the date that the Secretary determines 

appropriate; 

‘‘(B) ensure that the facility does not admit any new 

residents on or after the date on which such written 

notification is submitted; and 

‘‘(C) include in the notice a plan for the transfer and 

adequate relocation of the residents of the facility by a 

specified date prior to closure that has been approved by 

the State, including assurances that the residents will be 

transferred to the most appropriate facility or other setting 

in terms of quality, services, and location, taking into 

consideration the needs, choice, and best interests of each 

resident. 

‘‘(2) RELOCATION.— 

‘‘(A) IN GENERAL.—The State shall ensure that, before 

a facility closes, all residents of the facility have been 

successfully relocated to another facility or an alternative 

home and community-based setting. 

‘‘(B) CONTINUATION OF PAYMENTS UNTIL RESIDENTS

RELOCATED.—The Secretary may, as the Secretary determines appropriate, continue to make payments under this 

title with respect to residents of a facility that has submitted a notification under paragraph (1) during the period 

beginning on the date such notification is submitted and 

ending on the date on which the resident is successfully 

relocated. 

‘‘(3) SANCTIONS.—Any individual who is the administrator 

of a facility that fails to comply with the requirements of 

paragraph (1)— 

‘‘(A) shall be subject to a civil monetary penalty of 

up to $100,000; 

‘‘(B) may be subject to exclusion from participation 

in any Federal health care program (as defined in section 

1128B(f)); and 

‘‘(C) shall be subject to any other penalties that may 

be prescribed by law. 

‘‘(4) PROCEDURE.—The provisions of section 1128A (other 

than subsections (a) and (b) and the second sentence of subsection (f)) shall apply to a civil money penalty or exclusion 

under paragraph (3) in the same manner as such provisions 

apply to a penalty or proceeding under section 1128A(a).’’. 

(b) CONFORMING AMENDMENTS.—Section 1819(h)(4) of the Social 

Security Act (42 U.S.C. 1395i–3(h)(4)) is amended— 

(1) in the first sentence, by striking ‘‘the Secretary shall 

terminate’’ and inserting ‘‘the Secretary, subject to section 

1128I(h), shall terminate’’; and 

(2) in the second sentence, by striking ‘‘subsection (c)(2)’’ 

and inserting ‘‘subsection (c)(2) and section 1128I(h)’’. 
H. R. 3590—602 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect 1 year after the date of the enactment of this 

Act. 

SEC. 6114. NATIONAL DEMONSTRATION PROJECTS ON CULTURE 

CHANGE AND USE OF INFORMATION TECHNOLOGY IN 

NURSING HOMES. 

(a) IN GENERAL.—The Secretary shall conduct 2 demonstration 

projects, 1 for the development of best practices in skilled nursing 

facilities and nursing facilities that are involved in the culture 

change movement (including the development of resources for facilities to find and access funding in order to undertake culture change) 

and 1 for the development of best practices in skilled nursing 

facilities and nursing facilities for the use of information technology 

to improve resident care. 

(b) CONDUCT OF DEMONSTRATION PROJECTS.— 

(1) GRANT AWARD.—Under each demonstration project conducted under this section, the Secretary shall award 1 or more 

grants to facility-based settings for the development of best 

practices described in subsection (a) with respect to the demonstration project involved. Such award shall be made on a 

competitive basis and may be allocated in 1 lump-sum payment. 

(2) CONSIDERATION OF SPECIAL NEEDS OF RESIDENTS.—Each 

demonstration project conducted under this section shall take 

into consideration the special needs of residents of skilled 

nursing facilities and nursing facilities who have cognitive 

impairment, including dementia. 

(c) DURATION AND IMPLEMENTATION.— 

(1) DURATION.—The demonstration projects shall each be 

conducted for a period not to exceed 3 years. 

(2) IMPLEMENTATION.—The demonstration projects shall 

each be implemented not later than 1 year after the date 

of the enactment of this Act. 

(d) DEFINITIONS.—In this section: 

(1) NURSING FACILITY.—The term ‘‘nursing facility’’ has 

the meaning given such term in section 1919(a) of the Social 

Security Act (42 U.S.C. 1396r(a)). 

(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

(3) SKILLED NURSING FACILITY.—The term ‘‘skilled nursing 

facility’’ has the meaning given such term in section 1819(a) 

of the Social Security Act (42 U.S.C. 1395(a)). 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as may be necessary to carry out 

this section. 

(f) REPORT.—Not later than 9 months after the completion 

of the demonstration project, the Secretary shall submit to Congress 

a report on such project, together with recommendations for such 

legislation and administrative action as the Secretary determines 

appropriate. 

PART III—IMPROVING STAFF TRAINING 

SEC. 6121. DEMENTIA AND ABUSE PREVENTION TRAINING. 

(a) SKILLED NURSING FACILITIES.— 

(1) IN GENERAL.—Section 1819(f)(2)(A)(i)(I) of the Social 

Security Act (42 U.S.C. 1395i–3(f)(2)(A)(i)(I)) is amended by 
H. R. 3590—603 

inserting ‘‘(including, in the case of initial training and, if 

the Secretary determines appropriate, in the case of ongoing 

training, dementia management training, and patient abuse 

prevention training’’ before ‘‘, (II)’’. 

(2) CLARIFICATION OF DEFINITION OF NURSE AIDE.—Section 

1819(b)(5)(F) of the Social Security Act (42 U.S.C. 1395i– 

3(b)(5)(F)) is amended by adding at the end the following flush 

sentence: 

‘‘Such term includes an individual who provides such services through an agency or under a contract with the 

facility.’’. 

(b) NURSING FACILITIES.— 

(1) IN GENERAL.—Section 1919(f)(2)(A)(i)(I) of the Social 

Security Act (42 U.S.C. 1396r(f)(2)(A)(i)(I)) is amended by 

inserting ‘‘(including, in the case of initial training and, if 

the Secretary determines appropriate, in the case of ongoing 

training, dementia management training, and patient abuse 

prevention training’’ before ‘‘, (II)’’. 

(2) CLARIFICATION OF DEFINITION OF NURSE AIDE.—Section 

1919(b)(5)(F) of the Social Security Act (42 U.S.C. 

1396r(b)(5)(F)) is amended by adding at the end the following 

flush sentence: 

‘‘Such term includes an individual who provides such services through an agency or under a contract with the 

facility.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall take effect 1 year after the date of the enactment of this 

Act. 

Subtitle C—Nationwide Program for National and State Background Checks on 

Direct Patient Access Employees of 

Long-term Care Facilities and Providers 

SEC. 6201. NATIONWIDE PROGRAM FOR NATIONAL AND STATE BACKGROUND CHECKS ON DIRECT PATIENT ACCESS 

EMPLOYEES OF LONG-TERM CARE FACILITIES AND PROVIDERS. 

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

(in this section referred to as the ‘‘Secretary’’), shall establish a 

program to identify efficient, effective, and economical procedures 

for long term care facilities or providers to conduct background 

checks on prospective direct patient access employees on a nationwide basis (in this subsection, such program shall be referred to 

as the ‘‘nationwide program’’). Except for the following modifications, the Secretary shall carry out the nationwide program under 

similar terms and conditions as the pilot program under section 

307 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2257), 

including the prohibition on hiring abusive workers and the 

authorization of the imposition of penalties by a participating State 

under subsection (b)(3)(A) and (b)(6), respectively, of such section 

307: 

(1) AGREEMENTS.— 
H. R. 3590—604 

(A) NEWLY PARTICIPATING STATES.—The Secretary shall 

enter into agreements with each State— 

(i) that the Secretary has not entered into an 

agreement with under subsection (c)(1) of such section 

307; 

(ii) that agrees to conduct background checks 

under the nationwide program on a Statewide basis; 

and 

(iii) that submits an application to the Secretary 

containing such information and at such time as the 

Secretary may specify. 

(B) CERTAIN PREVIOUSLY PARTICIPATING STATES.—The 

Secretary shall enter into agreements with each State— 

(i) that the Secretary has entered into an agreement with under such subsection (c)(1), but only in 

the case where such agreement did not require the 

State to conduct background checks under the program 

established under subsection (a) of such section 307 

on a Statewide basis; 

(ii) that agrees to conduct background checks 

under the nationwide program on a Statewide basis; 

and 

(iii) that submits an application to the Secretary 

containing such information and at such time as the 

Secretary may specify. 

(2) NONAPPLICATION OF SELECTION CRITERIA.—The selection 

criteria required under subsection (c)(3)(B) of such section 307 

shall not apply. 

(3) REQUIRED FINGERPRINT CHECK AS PART OF CRIMINAL

HISTORY BACKGROUND CHECK.—The procedures established 

under subsection (b)(1) of such section 307 shall— 

(A) require that the long-term care facility or provider 

(or the designated agent of the long-term care facility or 

provider) obtain State and national criminal history background checks on the prospective employee through such 

means as the Secretary determines appropriate, efficient, 

and effective that utilize a search of State-based abuse 

and neglect registries and databases, including the abuse 

and neglect registries of another State in the case where 

a prospective employee previously resided in that State, 

State criminal history records, the records of any proceedings in the State that may contain disqualifying 

information about prospective employees (such as proceedings conducted by State professional licensing and disciplinary boards and State Medicaid Fraud Control Units), 

and Federal criminal history records, including a fingerprint check using the Integrated Automated Fingerprint 

Identification System of the Federal Bureau of Investigation; 

(B) require States to describe and test methods that 

reduce duplicative fingerprinting, including providing for 

the development of ‘‘rap back’’ capability by the State such 

that, if a direct patient access employee of a long-term 

care facility or provider is convicted of a crime following 

the initial criminal history background check conducted 
H. R. 3590—605 

with respect to such employee, and the employee’s fingerprints match the prints on file with the State law enforcement department, the department will immediately inform 

the State and the State will immediately inform the longterm care facility or provider which employs the direct 

patient access employee of such conviction; and 

(C) require that criminal history background checks 

conducted under the nationwide program remain valid for 

a period of time specified by the Secretary. 

(4) STATE REQUIREMENTS.—An agreement entered into 

under paragraph (1) shall require that a participating State— 

(A) be responsible for monitoring compliance with the 

requirements of the nationwide program; 

(B) have procedures in place to— 

(i) conduct screening and criminal history background checks under the nationwide program in accordance with the requirements of this section; 

(ii) monitor compliance by long-term care facilities 

and providers with the procedures and requirements 

of the nationwide program; 

(iii) as appropriate, provide for a provisional period 

of employment by a long-term care facility or provider 

of a direct patient access employee, not to exceed 60 

days, pending completion of the required criminal history background check and, in the case where the 

employee has appealed the results of such background 

check, pending completion of the appeals process, 

during which the employee shall be subject to direct 

on-site supervision (in accordance with procedures 

established by the State to ensure that a long-term 

care facility or provider furnishes such direct on-site 

supervision); 

(iv) provide an independent process by which a 

provisional employee or an employee may appeal or 

dispute the accuracy of the information obtained in 

a background check performed under the nationwide 

program, including the specification of criteria for 

appeals for direct patient access employees found to 

have disqualifying information which shall include 

consideration of the passage of time, extenuating circumstances, demonstration of rehabilitation, and relevancy of the particular disqualifying information with 

respect to the current employment of the individual; 

(v) provide for the designation of a single State 

agency as responsible for— 

(I) overseeing the coordination of any State 

and national criminal history background checks 

requested by a long-term care facility or provider 

(or the designated agent of the long-term care 

facility or provider) utilizing a search of State and 

Federal criminal history records, including a 

fingerprint check of such records; 

(II) overseeing the design of appropriate privacy and security safeguards for use in the review 

of the results of any State or national criminal 

history background checks conducted regarding a 
H. R. 3590—606 

prospective direct patient access employee to determine whether the employee has any conviction 

for a relevant crime; 

(III) immediately reporting to the long-term 

care facility or provider that requested the criminal 

history background check the results of such 

review; and 

(IV) in the case of an employee with a conviction for a relevant crime that is subject to reporting 

under section 1128E of the Social Security Act 

(42 U.S.C. 1320a–7e), reporting the existence of 

such conviction to the database established under 

that section; 

(vi) determine which individuals are direct patient 

access employees (as defined in paragraph (6)(B)) for 

purposes of the nationwide program; 

(vii) as appropriate, specify offenses, including 

convictions for violent crimes, for purposes of the 

nationwide program; and 

(viii) describe and test methods that reduce 

duplicative fingerprinting, including providing for the 

development of ‘‘rap back’’ capability such that, if a 

direct patient access employee of a long-term care 

facility or provider is convicted of a crime following 

the initial criminal history background check conducted 

with respect to such employee, and the employee’s 

fingerprints match the prints on file with the State 

law enforcement department— 

(I) the department will immediately inform 

the State agency designated under clause (v) and 

such agency will immediately inform the facility 

or provider which employs the direct patient access 

employee of such conviction; and 

(II) the State will provide, or will require the 

facility to provide, to the employee a copy of the 

results of the criminal history background check 

conducted with respect to the employee at no 

charge in the case where the individual requests 

such a copy. 

(5) PAYMENTS.— 

(A) NEWLY PARTICIPATING STATES.— 

(i) IN GENERAL.—As part of the application submitted by a State under paragraph (1)(A)(iii), the State 

shall guarantee, with respect to the costs to be incurred 

by the State in carrying out the nationwide program, 

that the State will make available (directly or through 

donations from public or private entities) a particular 

amount of non-Federal contributions, as a condition 

of receiving the Federal match under clause (ii). 

(ii) FEDERAL MATCH.—The payment amount to 

each State that the Secretary enters into an agreement 

with under paragraph (1)(A) shall be 3 times the 

amount that the State guarantees to make available 

under clause (i), except that in no case may the payment amount exceed $3,000,000. 

(B) PREVIOUSLY PARTICIPATING STATES.— 
H. R. 3590—607 

(i) IN GENERAL.—As part of the application submitted by a State under paragraph (1)(B)(iii), the State 

shall guarantee, with respect to the costs to be incurred 

by the State in carrying out the nationwide program, 

that the State will make available (directly or through 

donations from public or private entities) a particular 

amount of non-Federal contributions, as a condition 

of receiving the Federal match under clause (ii). 

(ii) FEDERAL MATCH.—The payment amount to 

each State that the Secretary enters into an agreement 

with under paragraph (1)(B) shall be 3 times the 

amount that the State guarantees to make available 

under clause (i), except that in no case may the payment amount exceed $1,500,000. 

(6) DEFINITIONS.—Under the nationwide program: 

(A) CONVICTION FOR A RELEVANT CRIME.—The term 

‘‘conviction for a relevant crime’’ means any Federal or 

State criminal conviction for— 

(i) any offense described in section 1128(a) of the 

Social Security Act (42 U.S.C. 1320a–7); or 

(ii) such other types of offenses as a participating 

State may specify for purposes of conducting the program in such State. 

(B) DISQUALIFYING INFORMATION.—The term ‘‘disqualifying information’’ means a conviction for a relevant crime 

or a finding of patient or resident abuse. 

(C) FINDING OF PATIENT OR RESIDENT ABUSE.—The 

term ‘‘finding of patient or resident abuse’’ means any 

substantiated finding by a State agency under section 

1819(g)(1)(C) or 1919(g)(1)(C) of the Social Security Act 

(42 U.S.C. 1395i–3(g)(1)(C), 1396r(g)(1)(C)) or a Federal 

agency that a direct patient access employee has committed— 

(i) an act of patient or resident abuse or neglect 

or a misappropriation of patient or resident property; 

or 

(ii) such other types of acts as a participating 

State may specify for purposes of conducting the program in such State. 

(D) DIRECT PATIENT ACCESS EMPLOYEE.—The term 

‘‘direct patient access employee’’ means any individual who 

has access to a patient or resident of a long-term care 

facility or provider through employment or through a contract with such facility or provider and has duties that 

involve (or may involve) one-on-one contact with a patient 

or resident of the facility or provider, as determined by 

the State for purposes of the nationwide program. Such 

term does not include a volunteer unless the volunteer 

has duties that are equivalent to the duties of a direct 

patient access employee and those duties involve (or may 

involve) one-on-one contact with a patient or resident of 

the long-term care facility or provider. 

(E) LONG-TERM CARE FACILITY OR PROVIDER.—The term 

‘‘long-term care facility or provider’’ means the following 

facilities or providers which receive payment for services 

under title XVIII or XIX of the Social Security Act: 
H. R. 3590—608 

(i) A skilled nursing facility (as defined in section 

1819(a) of the Social Security Act (42 U.S.C. 1395i– 

3(a))). 

(ii) A nursing facility (as defined in section 1919(a) 

of such Act (42 U.S.C. 1396r(a))). 

(iii) A home health agency. 

(iv) A provider of hospice care (as defined in section 

1861(dd)(1) of such Act (42 U.S.C. 1395x(dd)(1))). 

(v) A long-term care hospital (as described in section 1886(d)(1)(B)(iv) of such Act (42 U.S.C. 

1395ww(d)(1)(B)(iv))). 

(vi) A provider of personal care services. 

(vii) A provider of adult day care. 

(viii) A residential care provider that arranges for, 

or directly provides, long-term care services, including 

an assisted living facility that provides a level of care 

established by the Secretary. 

(ix) An intermediate care facility for the mentally 

retarded (as defined in section 1905(d) of such Act 

(42 U.S.C. 1396d(d))). 

(x) Any other facility or provider of long-term care 

services under such titles as the participating State 

determines appropriate. 

(7) EVALUATION AND REPORT.— 

(A) EVALUATION.— 

(i) IN GENERAL.—The Inspector General of the 

Department of Health and Human Services shall conduct an evaluation of the nationwide program. 

(ii) INCLUSION OF SPECIFIC TOPICS.—The evaluation 

conducted under clause (i) shall include the following: 

(I) A review of the various procedures implemented by participating States for long-term care 

facilities or providers, including staffing agencies, 

to conduct background checks of direct patient 

access employees under the nationwide program 

and identification of the most appropriate, efficient, and effective procedures for conducting such 

background checks. 

(II) An assessment of the costs of conducting 

such background checks (including start up and 

administrative costs). 

(III) A determination of the extent to which 

conducting such background checks leads to any 

unintended consequences, including a reduction in 

the available workforce for long-term care facilities 

or providers. 

(IV) An assessment of the impact of the nationwide program on reducing the number of incidents 

of neglect, abuse, and misappropriation of resident 

property to the extent practicable. 

(V) An evaluation of other aspects of the 

nationwide program, as determined appropriate by 

the Secretary. 

(B) REPORT.—Not later than 180 days after the completion of the nationwide program, the Inspector General of 

the Department of Health and Human Services shall 
H. R. 3590—609 

submit a report to Congress containing the results of the 

evaluation conducted under subparagraph (A). 

(b) FUNDING.— 

(1) NOTIFICATION.—The Secretary of Health and Human 

Services shall notify the Secretary of the Treasury of the 

amount necessary to carry out the nationwide program under 

this section for the period of fiscal years 2010 through 2012, 

except that in no case shall such amount exceed $160,000,000. 

(2) TRANSFER OF FUNDS.— 

(A) IN GENERAL.—Out of any funds in the Treasury 

not otherwise appropriated, the Secretary of the Treasury 

shall provide for the transfer to the Secretary of Health 

and Human Services of the amount specified as necessary 

to carry out the nationwide program under paragraph (1). 

Such amount shall remain available until expended. 

(B) RESERVATION OF FUNDS FOR CONDUCT OF EVALUATION.—The Secretary may reserve not more than 

$3,000,000 of the amount transferred under subparagraph 

(A) to provide for the conduct of the evaluation under 

subsection (a)(7)(A). 

Subtitle D—Patient-Centered Outcomes 

Research 

SEC. 6301. PATIENT-CENTERED OUTCOMES RESEARCH. 

(a) IN GENERAL.—Title XI of the Social Security Act (42 U.S.C. 

1301 et seq.) is amended by adding at the end the following new 

part: 

‘‘PART D—COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH

‘‘COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH

‘‘SEC. 1181. (a) DEFINITIONS.—In this section: 

‘‘(1) BOARD.—The term ‘Board’ means the Board of Governors established under subsection (f). 

‘‘(2) COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH; 

RESEARCH.— 

‘‘(A) IN GENERAL.—The terms ‘comparative clinical 

effectiveness research’ and ‘research’ mean research evaluating and comparing health outcomes and the clinical 

effectiveness, risks, and benefits of 2 or more medical treatments, services, and items described in subparagraph (B). 

‘‘(B) MEDICAL TREATMENTS, SERVICES, AND ITEMS

DESCRIBED.—The medical treatments, services, and items 

described in this subparagraph are health care interventions, protocols for treatment, care management, and 

delivery, procedures, medical devices, diagnostic tools, 

pharmaceuticals (including drugs and biologicals), integrative health practices, and any other strategies or items 

being used in the treatment, management, and diagnosis 

of, or prevention of illness or injury in, individuals. 

‘‘(3) CONFLICT OF INTEREST.—The term ‘conflict of interest’ 

means an association, including a financial or personal association, that have the potential to bias or have the appearance 
H. R. 3590—610 

of biasing an individual’s decisions in matters related to the 

Institute or the conduct of activities under this section. 

‘‘(4) REAL CONFLICT OF INTEREST.—The term ‘real conflict 

of interest’ means any instance where a member of the Board, 

the methodology committee established under subsection (d)(6), 

or an advisory panel appointed under subsection (d)(4), or a 

close relative of such member, has received or could receive 

either of the following: 

‘‘(A) A direct financial benefit of any amount deriving 

from the result or findings of a study conducted under 

this section. 

‘‘(B) A financial benefit from individuals or companies 

that own or manufacture medical treatments, services, or 

items to be studied under this section that in the aggregate 

exceeds $10,000 per year. For purposes of the preceding 

sentence, a financial benefit includes honoraria, fees, stock, 

or other financial benefit and the current value of the 

member or close relative’s already existing stock holdings, 

in addition to any direct financial benefit deriving from 

the results or findings of a study conducted under this 

section. 

‘‘(b) PATIENT-CENTERED OUTCOMES RESEARCH INSTITUTE.— 

‘‘(1) ESTABLISHMENT.—There is authorized to be established 

a nonprofit corporation, to be known as the ‘Patient-Centered 

Outcomes Research Institute’ (referred to in this section as 

the ‘Institute’) which is neither an agency nor establishment 

of the United States Government. 

‘‘(2) APPLICATION OF PROVISIONS.—The Institute shall be 

subject to the provisions of this section, and, to the extent 

consistent with this section, to the District of Columbia Nonprofit Corporation Act. 

‘‘(3) FUNDING OF COMPARATIVE CLINICAL EFFECTIVENESS

RESEARCH.—For fiscal year 2010 and each subsequent fiscal 

year, amounts in the Patient-Centered Outcomes Research 

Trust Fund (referred to in this section as the ‘PCORTF’) under 

section 9511 of the Internal Revenue Code of 1986 shall be 

available, without further appropriation, to the Institute to 

carry out this section. 

‘‘(c) PURPOSE.—The purpose of the Institute is to assist patients, 

clinicians, purchasers, and policy-makers in making informed health 

decisions by advancing the quality and relevance of evidence concerning the manner in which diseases, disorders, and other health 

conditions can effectively and appropriately be prevented, 

diagnosed, treated, monitored, and managed through research and 

evidence synthesis that considers variations in patient subpopulations, and the dissemination of research findings with respect to 

the relative health outcomes, clinical effectiveness, and appropriateness of the medical treatments, services, and items described in 

subsection (a)(2)(B). 

‘‘(d) DUTIES.— 

‘‘(1) IDENTIFYING RESEARCH PRIORITIES AND ESTABLISHING

RESEARCH PROJECT AGENDA.— ‘‘(A) IDENTIFYING RESEARCH PRIORITIES.—The Institute 

shall identify national priorities for research, taking into 

account factors of disease incidence, prevalence, and burden 

in the United States (with emphasis on chronic conditions), 

gaps in evidence in terms of clinical outcomes, practice 
H. R. 3590—611 

variations and health disparities in terms of delivery and 

outcomes of care, the potential for new evidence to improve 

patient health, well-being, and the quality of care, the 

effect on national expenditures associated with a health 

care treatment, strategy, or health conditions, as well as 

patient needs, outcomes, and preferences, the relevance 

to patients and clinicians in making informed health 

decisions, and priorities in the National Strategy for quality 

care established under section 399H of the Public Health 

Service Act that are consistent with this section. 

‘‘(B) ESTABLISHING RESEARCH PROJECT AGENDA.—The 

Institute shall establish and update a research project 

agenda for research to address the priorities identified 

under subparagraph (A), taking into consideration the 

types of research that might address each priority and 

the relative value (determined based on the cost of conducting research compared to the potential usefulness of 

the information produced by research) associated with the 

different types of research, and such other factors as the 

Institute determines appropriate. 

‘‘(2) CARRYING OUT RESEARCH PROJECT AGENDA.— 

‘‘(A) RESEARCH.—The Institute shall carry out the 

research project agenda established under paragraph (1)(B) 

in accordance with the methodological standards adopted 

under paragraph (9) using methods, including the following: 

‘‘(i) Systematic reviews and assessments of existing 

and future research and evidence including original 

research conducted subsequent to the date of the enactment of this section. 

‘‘(ii) Primary research, such as randomized clinical 

trials, molecularly informed trials, and observational 

studies. 

‘‘(iii) Any other methodologies recommended by the 

methodology committee established under paragraph 

(6) that are adopted by the Board under paragraph 

(9). 

‘‘(B) CONTRACTS FOR THE MANAGEMENT OF FUNDING

AND CONDUCT OF RESEARCH.— 

‘‘(i) CONTRACTS.— 

‘‘(I) IN GENERAL.—In accordance with the 

research project agenda established under paragraph (1)(B), the Institute shall enter into contracts for the management of funding and conduct 

of research in accordance with the following: 

‘‘(aa) Appropriate agencies and instrumentalities of the Federal Government. 

‘‘(bb) Appropriate academic research, private sector research, or study-conducting entities. 

‘‘(II) PREFERENCE.—In entering into contracts 

under subclause (I), the Institute shall give preference to the Agency for Healthcare Research and 

Quality and the National Institutes of Health, but 

only if the research to be conducted or managed 

under such contract is authorized by the governing 

statutes of such Agency or Institutes. 
H. R. 3590—612 

‘‘(ii) CONDITIONS FOR CONTRACTS.—A contract 

entered into under this subparagraph shall require 

that the agency, instrumentality, or other entity— 

‘‘(I) abide by the transparency and conflicts 

of interest requirements under subsection (h) that 

apply to the Institute with respect to the research 

managed or conducted under such contract; 

‘‘(II) comply with the methodological standards 

adopted under paragraph (9) with respect to such 

research; 

‘‘(III) consult with the expert advisory panels 

for clinical trials and rare disease appointed under 

clauses (ii) and (iii), respectively, of paragraph 

(4)(A); 

‘‘(IV) subject to clause (iv), permit a researcher 

who conducts original research under the contract 

for the agency, instrumentality, or other entity 

to have such research published in a peer-reviewed 

journal or other publication; 

‘‘(V) have appropriate processes in place to 

manage data privacy and meet ethical standards 

for the research; 

‘‘(VI) comply with the requirements of the 

Institute for making the information available to 

the public under paragraph (8); and 

‘‘(VII) comply with other terms and conditions 

determined necessary by the Institute to carry out 

the research agenda adopted under paragraph (2). 

‘‘(iii) COVERAGE OF COPAYMENTS OR COINSUR- ANCE.—A contract entered into under this subparagraph may allow for the coverage of copayments or 

coinsurance, or allow for other appropriate measures, 

to the extent that such coverage or other measures 

are necessary to preserve the validity of a research 

project, such as in the case where the research project 

must be blinded. 

‘‘(iv) REQUIREMENTS FOR PUBLICATION OF

RESEARCH.—Any research published under clause 

(ii)(IV) shall be within the bounds of and entirely consistent with the evidence and findings produced under 

the contract with the Institute under this subparagraph. If the Institute determines that those requirements are not met, the Institute shall not enter into 

another contract with the agency, instrumentality, or 

entity which managed or conducted such research for 

a period determined appropriate by the Institute (but 

not less than 5 years). 

‘‘(C) REVIEW AND UPDATE OF EVIDENCE.—The Institute 

shall review and update evidence on a periodic basis as 

appropriate. 

‘‘(D) TAKING INTO ACCOUNT POTENTIAL DIFFERENCES.— Research shall be designed, as appropriate, to take into 

account the potential for differences in the effectiveness 

of health care treatments, services, and items as used 

with various subpopulations, such as racial and ethnic 

minorities, women, age, and groups of individuals with 

different comorbidities, genetic and molecular sub-types, 
H. R. 3590—613 

or quality of life preferences and include members of such 

subpopulations as subjects in the research as feasible and 

appropriate. 

‘‘(E) DIFFERENCES IN TREATMENT MODALITIES.— 

Research shall be designed, as appropriate, to take into 

account different characteristics of treatment modalities 

that may affect research outcomes, such as the phase of 

the treatment modality in the innovation cycle and the 

impact of the skill of the operator of the treatment 

modality. 

‘‘(3) DATA COLLECTION.— ‘‘(A) IN GENERAL.—The Secretary shall, with appropriate safeguards for privacy, make available to the 

Institute such data collected by the Centers for Medicare 

& Medicaid Services under the programs under titles XVIII, 

XIX, and XXI, as well as provide access to the data networks developed under section 937(f) of the Public Health 

Service Act, as the Institute and its contractors may require 

to carry out this section. The Institute may also request 

and obtain data from Federal, State, or private entities, 

including data from clinical databases and registries. 

‘‘(B) USE OF DATA.—The Institute shall only use data 

provided to the Institute under subparagraph (A) in accordance with laws and regulations governing the release and 

use of such data, including applicable confidentiality and 

privacy standards. 

‘‘(4) APPOINTING EXPERT ADVISORY PANELS.— ‘‘(A) APPOINTMENT.— ‘‘(i) IN GENERAL.—The Institute may appoint 

permanent or ad hoc expert advisory panels as determined appropriate to assist in identifying research 

priorities and establishing the research project agenda 

under paragraph (1) and for other purposes. 

‘‘(ii) EXPERT ADVISORY PANELS FOR CLINICAL

TRIALS.—The Institute shall appoint expert advisory 

panels in carrying out randomized clinical trials under 

the research project agenda under paragraph (2)(A)(ii). 

Such expert advisory panels shall advise the Institute 

and the agency, instrumentality, or entity conducting 

the research on the research question involved and 

the research design or protocol, including important 

patient subgroups and other parameters of the 

research. Such panels shall be available as a resource 

for technical questions that may arise during the conduct of such research. 

‘‘(iii) EXPERT ADVISORY PANEL FOR RARE DISEASE.— In the case of a research study for rare disease, the 

Institute shall appoint an expert advisory panel for 

purposes of assisting in the design of the research 

study and determining the relative value and feasibility of conducting the research study. 

‘‘(B) COMPOSITION.—An expert advisory panel 

appointed under subparagraph (A) shall include representatives of practicing and research clinicians, patients, and 

experts in scientific and health services research, health 

services delivery, and evidence-based medicine who have 

experience in the relevant topic, and as appropriate, experts 
H. R. 3590—614 

in integrative health and primary prevention strategies. 

The Institute may include a technical expert of each manufacturer or each medical technology that is included under 

the relevant topic, project, or category for which the panel 

is established. 

‘‘(5) SUPPORTING PATIENT AND CONSUMER REPRESENTATIVES.—The Institute shall provide support and resources to 

help patient and consumer representatives effectively participate on the Board and expert advisory panels appointed by 

the Institute under paragraph (4). 

‘‘(6) ESTABLISHING METHODOLOGY COMMITTEE.— ‘‘(A) IN GENERAL.—The Institute shall establish a 

standing methodology committee to carry out the functions 

described in subparagraph (C). 

‘‘(B) APPOINTMENT AND COMPOSITION.—The methodology committee established under subparagraph (A) shall 

be composed of not more than 15 members appointed by 

the Comptroller General of the United States. Members 

appointed to the methodology committee shall be experts 

in their scientific field, such as health services research, 

clinical research, comparative clinical effectiveness 

research, biostatistics, genomics, and research methodologies. Stakeholders with such expertise may be appointed 

to the methodology committee. In addition to the members 

appointed under the first sentence, the Directors of the 

National Institutes of Health and the Agency for 

Healthcare Research and Quality (or their designees) shall 

each be included as members of the methodology committee. 

‘‘(C) FUNCTIONS.—Subject to subparagraph (D), the 

methodology committee shall work to develop and improve 

the science and methods of comparative clinical effectiveness research by, not later than 18 months after the 

establishment of the Institute, directly or through subcontract, developing and periodically updating the following: 

‘‘(i) Methodological standards for research. Such 

methodological standards shall provide specific criteria 

for internal validity, generalizability, feasibility, and 

timeliness of research and for health outcomes measures, risk adjustment, and other relevant aspects of 

research and assessment with respect to the design 

of research. Any methodological standards developed 

and updated under this subclause shall be scientifically 

based and include methods by which new information, 

data, or advances in technology are considered and 

incorporated into ongoing research projects by the 

Institute, as appropriate. The process for developing 

and updating such standards shall include input from 

relevant experts, stakeholders, and decisionmakers, 

and shall provide opportunities for public comment. 

Such standards shall also include methods by which 

patient subpopulations can be accounted for and evaluated in different types of research. As appropriate, 

such standards shall build on existing work on methodological standards for defined categories of health 

interventions and for each of the major categories of 
H. R. 3590—615 

comparative clinical effectiveness research methods 

(determined as of the date of enactment of the Patient 

Protection and Affordable Care Act). 

‘‘(ii) A translation table that is designed to provide 

guidance and act as a reference for the Board to determine research methods that are most likely to address 

each specific research question. 

‘‘(D) CONSULTATION AND CONDUCT OF EXAMINATIONS.— 

The methodology committee may consult and contract with 

the Institute of Medicine of the National Academies and 

academic, nonprofit, or other private and governmental 

entities with relevant expertise to carry out activities 

described in subparagraph (C) and may consult with relevant stakeholders to carry out such activities. 

‘‘(E) REPORTS.—The methodology committee shall 

submit reports to the Board on the committee’s performance 

of the functions described in subparagraph (C). Reports 

shall contain recommendations for the Institute to adopt 

methodological standards developed and updated by the 

methodology committee as well as other actions deemed 

necessary to comply with such methodological standards. 

‘‘(7) PROVIDING FOR A PEER-REVIEW PROCESS FOR PRIMARY

RESEARCH.— 

‘‘(A) IN GENERAL.—The Institute shall ensure that there 

is a process for peer review of primary research described 

in subparagraph (A)(ii) of paragraph (2) that is conducted 

under such paragraph. Under such process— 

‘‘(i) evidence from such primary research shall be 

reviewed to assess scientific integrity and adherence 

to methodological standards adopted under paragraph 

(9); and 

‘‘(ii) a list of the names of individuals contributing 

to any peer-review process during the preceding year 

or years shall be made public and included in annual 

reports in accordance with paragraph (10)(D). 

‘‘(B) COMPOSITION.—Such peer-review process shall be 

designed in a manner so as to avoid bias and conflicts 

of interest on the part of the reviewers and shall be composed of experts in the scientific field relevant to the 

research under review. 

‘‘(C) USE OF EXISTING PROCESSES.— 

‘‘(i) PROCESSES OF ANOTHER ENTITY.—In the case 

where the Institute enters into a contract or other 

agreement with another entity for the conduct or 

management of research under this section, the 

Institute may utilize the peer-review process of such 

entity if such process meets the requirements under 

subparagraphs (A) and (B). 

‘‘(ii) PROCESSES OF APPROPRIATE MEDICAL JOURNALS.—The Institute may utilize the peer-review 

process of appropriate medical journals if such process 

meets the requirements under subparagraphs (A) and 

(B). 

‘‘(8) RELEASE OF RESEARCH FINDINGS.— ‘‘(A) IN GENERAL.—The Institute shall, not later than 

90 days after the conduct or receipt of research findings 

under this part, make such research findings available 
H. R. 3590—616 

to clinicians, patients, and the general public. The Institute 

shall ensure that the research findings— 

‘‘(i) convey the findings of research in a manner 

that is comprehensible and useful to patients and providers in making health care decisions; 

‘‘(ii) fully convey findings and discuss considerations specific to certain subpopulations, risk factors, 

and comorbidities, as appropriate; 

‘‘(iii) include limitations of the research and what 

further research may be needed as appropriate; 

‘‘(iv) not be construed as mandates for practice 

guidelines, coverage recommendations, payment, or 

policy recommendations; and 

‘‘(v) not include any data which would violate the 

privacy of research participants or any confidentiality 

agreements made with respect to the use of data under 

this section. 

‘‘(B) DEFINITION OF RESEARCH FINDINGS.—In this paragraph, the term ‘research findings’ means the results of 

a study or assessment. 

‘‘(9) ADOPTION.—Subject to subsection (h)(1), the Institute 

shall adopt the national priorities identified under paragraph 

(1)(A), the research project agenda established under paragraph 

(1)(B), the methodological standards developed and updated 

by the methodology committee under paragraph (6)(C)(i), and 

any peer-review process provided under paragraph (7) by 

majority vote. In the case where the Institute does not adopt 

such processes in accordance with the preceding sentence, the 

processes shall be referred to the appropriate staff or entity 

within the Institute (or, in the case of the methodological standards, the methodology committee) for further review. 

‘‘(10) ANNUAL REPORTS.—The Institute shall submit an 

annual report to Congress and the President, and shall make 

the annual report available to the public. Such report shall 

contain— 

‘‘(A) a description of the activities conducted under 

this section, research priorities identified under paragraph 

(1)(A) and methodological standards developed and updated 

by the methodology committee under paragraph (6)(C)(i) 

that are adopted under paragraph (9) during the preceding 

year; 

‘‘(B) the research project agenda and budget of the 

Institute for the following year; 

‘‘(C) any administrative activities conducted by the 

Institute during the preceding year; 

‘‘(D) the names of individuals contributing to any peerreview process under paragraph (7), without identifying 

them with a particular research project; and 

‘‘(E) any other relevant information (including information on the membership of the Board, expert advisory 

panels, methodology committee, and the executive staff 

of the Institute, any conflicts of interest with respect to 

these individuals, and any bylaws adopted by the Board 

during the preceding year). 

‘‘(e) ADMINISTRATION.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the Board shall 

carry out the duties of the Institute. 
H. R. 3590—617 

‘‘(2) NONDELEGABLE DUTIES.—The activities described in 

subsections (d)(1) and (d)(9) are nondelegable. 

‘‘(f) BOARD OF GOVERNORS.— 

‘‘(1) IN GENERAL.—The Institute shall have a Board of 

Governors, which shall consist of the following members: 

‘‘(A) The Director of Agency for Healthcare Research 

and Quality (or the Director’s designee). 

‘‘(B) The Director of the National Institutes of Health 

(or the Director’s designee). 

‘‘(C) Seventeen members appointed, not later than 6 

months after the date of enactment of this section, by 

the Comptroller General of the United States as follows: 

‘‘(i) 3 members representing patients and health 

care consumers. 

‘‘(ii) 5 members representing physicians and providers, including at least 1 surgeon, nurse, Statelicensed integrative health care practitioner, and representative of a hospital. 

‘‘(iii) 3 members representing private payers, of 

whom at least 1 member shall represent health insurance issuers and at least 1 member shall represent 

employers who self-insure employee benefits. 

‘‘(iv) 3 members representing pharmaceutical, 

device, and diagnostic manufacturers or developers. 

‘‘(v) 1 member representing quality improvement 

or independent health service researchers. 

‘‘(vi) 2 members representing the Federal Government or the States, including at least 1 member representing a Federal health program or agency. 

‘‘(2) QUALIFICATIONS.—The Board shall represent a broad 

range of perspectives and collectively have scientific expertise 

in clinical health sciences research, including epidemiology, 

decisions sciences, health economics, and statistics. In 

appointing the Board, the Comptroller General of the United 

States shall consider and disclose any conflicts of interest in 

accordance with subsection (h)(4)(B). Members of the Board 

shall be recused from relevant Institute activities in the case 

where the member (or an immediate family member of such 

member) has a real conflict of interest directly related to the 

research project or the matter that could affect or be affected 

by such participation. 

‘‘(3) TERMS; VACANCIES.—A member of the Board shall be 

appointed for a term of 6 years, except with respect to the 

members first appointed, whose terms of appointment shall 

be staggered evenly over 2-year increments. No individual shall 

be appointed to the Board for more than 2 terms. Vacancies 

shall be filled in the same manner as the original appointment 

was made. 

‘‘(4) CHAIRPERSON AND VICE-CHAIRPERSON.—The Comptroller General of the United States shall designate a Chairperson and Vice Chairperson of the Board from among the 

members of the Board. Such members shall serve as Chairperson or Vice Chairperson for a period of 3 years. 

‘‘(5) COMPENSATION.—Each member of the Board who is 

not an officer or employee of the Federal Government shall 

be entitled to compensation (equivalent to the rate provided 

for level IV of the Executive Schedule under section 5315 of 
H. R. 3590—618 

title 5, United States Code) and expenses incurred while performing the duties of the Board. An officer or employee of 

the Federal government who is a member of the Board shall 

be exempt from compensation. 

‘‘(6) DIRECTOR AND STAFF; EXPERTS AND CONSULTANTS.— 

The Board may employ and fix the compensation of an Executive Director and such other personnel as may be necessary 

to carry out the duties of the Institute and may seek such 

assistance and support of, or contract with, experts and consultants that may be necessary for the performance of the duties 

of the Institute. 

‘‘(7) MEETINGS AND HEARINGS.—The Board shall meet and 

hold hearings at the call of the Chairperson or a majority 

of its members. Meetings not solely concerning matters of personnel shall be advertised at least 7 days in advance and 

open to the public. A majority of the Board members shall 

constitute a quorum, but a lesser number of members may 

meet and hold hearings. 

‘‘(g) FINANCIAL AND GOVERNMENTAL OVERSIGHT.— 

‘‘(1) CONTRACT FOR AUDIT.—The Institute shall provide for 

the conduct of financial audits of the Institute on an annual 

basis by a private entity with expertise in conducting financial 

audits. 

‘‘(2) REVIEW AND ANNUAL REPORTS.— 

‘‘(A) REVIEW.—The Comptroller General of the United 

States shall review the following: 

‘‘(i) Not less frequently than on an annual basis, 

the financial audits conducted under paragraph (1). 

‘‘(ii) Not less frequently than every 5 years, the 

processes established by the Institute, including the 

research priorities and the conduct of research projects, 

in order to determine whether information produced 

by such research projects is objective and credible, 

is produced in a manner consistent with the requirements under this section, and is developed through 

a transparent process. 

‘‘(iii) Not less frequently than every 5 years, the 

dissemination and training activities and data networks established under section 937 of the Public 

Health Service Act, including the methods and products used to disseminate research, the types of training 

conducted and supported, and the types and functions 

of the data networks established, in order to determine 

whether the activities and data are produced in a 

manner consistent with the requirements under such 

section. 

‘‘(iv) Not less frequently than every 5 years, the 

overall effectiveness of activities conducted under this 

section and the dissemination, training, and capacity 

building activities conducted under section 937 of the 

Public Health Service Act. Such review shall include 

an analysis of the extent to which research findings 

are used by health care decision-makers, the effect 

of the dissemination of such findings on reducing practice variation and disparities in health care, and the 

effect of the research conducted and disseminated on 
H. R. 3590—619 

innovation and the health care economy of the United 

States. 

‘‘(v) Not later than 8 years after the date of enactment of this section, the adequacy and use of the 

funding for the Institute and the activities conducted 

under section 937 of the Public Health Service Act, 

including a determination as to whether, based on 

the utilization of research findings by public and private payers, funding sources for the Patient-Centered 

Outcomes Research Trust Fund under section 9511 

of the Internal Revenue Code of 1986 are appropriate 

and whether such sources of funding should be continued or adjusted. 

‘‘(B) ANNUAL REPORTS.—Not later than April 1 of each 

year, the Comptroller General of the United States shall 

submit to Congress a report containing the results of the 

review conducted under subparagraph (A) with respect to 

the preceding year (or years, if applicable), together with 

recommendations for such legislation and administrative 

action as the Comptroller General determines appropriate. 

‘‘(h) ENSURING TRANSPARENCY, CREDIBILITY, AND ACCESS.—The 

Institute shall establish procedures to ensure that the following 

requirements for ensuring transparency, credibility, and access are 

met: 

‘‘(1) PUBLIC COMMENT PERIODS.—The Institute shall provide 

for a public comment period of not less than 45 days and 

not more than 60 days prior to the adoption under subsection 

(d)(9) of the national priorities identified under subsection 

(d)(1)(A), the research project agenda established under subsection (d)(1)(B), the methodological standards developed and 

updated by the methodology committee under subsection 

(d)(6)(C)(i), and the peer-review process provided under paragraph (7), and after the release of draft findings with respect 

to systematic reviews of existing research and evidence. 

‘‘(2) ADDITIONAL FORUMS.—The Institute shall support 

forums to increase public awareness and obtain and incorporate 

public input and feedback through media (such as an Internet 

website) on research priorities, research findings, and other 

duties, activities, or processes the Institute determines appropriate. 

‘‘(3) PUBLIC AVAILABILITY.—The Institute shall make available to the public and disclose through the official public Internet website of the Institute the following: 

‘‘(A) Information contained in research findings as 

specified in subsection (d)(9). 

‘‘(B) The process and methods for the conduct of 

research, including the identity of the entity and the investigators conducing such research and any conflicts of 

interests of such parties, any direct or indirect links the 

entity has to industry, and research protocols, including 

measures taken, methods of research and analysis, research 

results, and such other information the Institute determines appropriate) concurrent with the release of research 

findings. 

‘‘(C) Notice of public comment periods under paragraph 

(1), including deadlines for public comments. 
H. R. 3590—620 

‘‘(D) Subsequent comments received during each of the 

public comment periods. 

‘‘(E) In accordance with applicable laws and processes 

and as the Institute determines appropriate, proceedings 

of the Institute. 

‘‘(4) DISCLOSURE OF CONFLICTS OF INTEREST.— 

‘‘(A) IN GENERAL.—A conflict of interest shall be disclosed in the following manner: 

‘‘(i) By the Institute in appointing members to 

an expert advisory panel under subsection (d)(4), in 

selecting individuals to contribute to any peer-review 

process under subsection (d)(7), and for employment 

as executive staff of the Institute. 

‘‘(ii) By the Comptroller General in appointing 

members of the methodology committee under subsection (d)(6); 

‘‘(iii) By the Institute in the annual report under 

subsection (d)(10), except that, in the case of individuals contributing to any such peer review process, such 

description shall be in a manner such that those 

individuals cannot be identified with a particular 

research project. 

‘‘(B) MANNER OF DISCLOSURE.—Conflicts of interest 

shall be disclosed as described in subparagraph (A) as 

soon as practicable on the Internet web site of the Institute 

and of the Government Accountability Office. The information disclosed under the preceding sentence shall include 

the type, nature, and magnitude of the interests of the 

individual involved, except to the extent that the individual 

recuses himself or herself from participating in the consideration of or any other activity with respect to the study 

as to which the potential conflict exists. 

‘‘(i) RULES.—The Institute, its Board or staff, shall be prohibited 

from accepting gifts, bequeaths, or donations of services or property. 

In addition, the Institute shall be prohibited from establishing 

a corporation or generating revenues from activities other than 

as provided under this section. 

‘‘(j) RULES OF CONSTRUCTION.— 

‘‘(1) COVERAGE.—Nothing in this section shall be construed— 

‘‘(A) to permit the Institute to mandate coverage, 

reimbursement, or other policies for any public or private 

payer; or 

‘‘(B) as preventing the Secretary from covering the 

routine costs of clinical care received by an individual entitled to, or enrolled for, benefits under title XVIII, XIX, 

or XXI in the case where such individual is participating 

in a clinical trial and such costs would otherwise be covered 

under such title with respect to the beneficiary.’’. 

(b) DISSEMINATION AND BUILDING CAPACITY FOR RESEARCH.— 

Title IX of the Public Health Service Act (42 U.S.C. 299 et seq.), 

as amended by section 3606, is further amended by inserting after 

section 936 the following: 

‘‘SEC. 937. DISSEMINATION AND BUILDING CAPACITY FOR RESEARCH. 

‘‘(a) IN GENERAL.— 
H. R. 3590—621 

‘‘(1) DISSEMINATION.—The Office of Communication and 

Knowledge Transfer (referred to in this section as the ‘Office’) 

at the Agency for Healthcare Research and Quality (or any 

other relevant office designated by Agency for Healthcare 

Research and Quality), in consultation with the National 

Institutes of Health, shall broadly disseminate the research 

findings that are published by the Patient Centered Outcomes 

Research Institute established under section 1181(b) of the 

Social Security Act (referred to in this section as the ‘Institute’) 

and other government-funded research relevant to comparative 

clinical effectiveness research. The Office shall create informational tools that organize and disseminate research findings 

for physicians, health care providers, patients, payers, and 

policy makers. The Office shall also develop a publicly available 

resource database that collects and contains government-funded 

evidence and research from public, private, not-for profit, and 

academic sources. 

‘‘(2) REQUIREMENTS.—The Office shall provide for the 

dissemination of the Institute’s research findings and government-funded research relevant to comparative clinical effectiveness research to physicians, health care providers, patients, 

vendors of health information technology focused on clinical 

decision support, appropriate professional associations, and 

Federal and private health plans. Materials, forums, and media 

used to disseminate the findings, informational tools, and 

resource databases shall— 

‘‘(A) include a description of considerations for specific 

subpopulations, the research methodology, and the limitations of the research, and the names of the entities, agencies, instrumentalities, and individuals who conducted any 

research which was published by the Institute; and 

‘‘(B) not be construed as mandates, guidelines, or recommendations for payment, coverage, or treatment. 

‘‘(b) INCORPORATION OF RESEARCH FINDINGS.—The Office, in 

consultation with relevant medical and clinical associations, shall 

assist users of health information technology focused on clinical 

decision support to promote the timely incorporation of research 

findings disseminated under subsection (a) into clinical practices 

and to promote the ease of use of such incorporation. 

‘‘(c) FEEDBACK.—The Office shall establish a process to receive 

feedback from physicians, health care providers, patients, and vendors of health information technology focused on clinical decision 

support, appropriate professional associations, and Federal and private health plans about the value of the information disseminated 

and the assistance provided under this section. 

‘‘(d) RULE OF CONSTRUCTION.—Nothing in this section shall 

preclude the Institute from making its research findings publicly 

available as required under section 1181(d)(8) of the Social Security 

Act. 

‘‘(e) TRAINING OF RESEARCHERS.—The Agency for Health Care 

Research and Quality, in consultation with the National Institutes 

of Health, shall build capacity for comparative clinical effectiveness 

research by establishing a grant program that provides for the 

training of researchers in the methods used to conduct such 

research, including systematic reviews of existing research and 

primary research such as clinical trials. At a minimum, such 
H. R. 3590—622 

training shall be in methods that meet the methodological standards 

adopted under section 1181(d)(9) of the Social Security Act. 

‘‘(f) BUILDING DATA FOR RESEARCH.—The Secretary shall provide for the coordination of relevant Federal health programs to 

build data capacity for comparative clinical effectiveness research, 

including the development and use of clinical registries and health 

outcomes research data networks, in order to develop and maintain 

a comprehensive, interoperable data network to collect, link, and 

analyze data on outcomes and effectiveness from multiple sources, 

including electronic health records. 

‘‘(g) AUTHORITY TO CONTRACT WITH THE INSTITUTE.—Agencies 

and instrumentalities of the Federal Government may enter into 

agreements with the Institute, and accept and retain funds, for 

the conduct and support of research described in this part, provided 

that the research to be conducted or supported under such agreements is authorized under the governing statutes of such agencies 

and instrumentalities.’’. 

(c) IN GENERAL.—Part D of title XI of the Social Security 

Act, as added by subsection (a), is amended by adding at the 

end the following new section: 

‘‘LIMITATIONS ON CERTAIN USES OF COMPARATIVE CLINICAL

EFFECTIVENESS RESEARCH

‘‘SEC. 1182. (a) The Secretary may only use evidence and 

findings from research conducted under section 1181 to make a 

determination regarding coverage under title XVIII if such use 

is through an iterative and transparent process which includes 

public comment and considers the effect on subpopulations. 

‘‘(b) Nothing in section 1181 shall be construed as— 

‘‘(1) superceding or modifying the coverage of items or 

services under title XVIII that the Secretary determines are 

reasonable and necessary under section 1862(l)(1); or 

‘‘(2) authorizing the Secretary to deny coverage of items 

or services under such title solely on the basis of comparative 

clinical effectiveness research. 

‘‘(c)(1) The Secretary shall not use evidence or findings from 

comparative clinical effectiveness research conducted under section 

1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that treats extending the 

life of an elderly, disabled, or terminally ill individual as of lower 

value than extending the life of an individual who is younger, 

nondisabled, or not terminally ill. 

‘‘(2) Paragraph (1) shall not be construed as preventing the 

Secretary from using evidence or findings from such comparative 

clinical effectiveness research in determining coverage, reimbursement, or incentive programs under title XVIII based upon a 

comparison of the difference in the effectiveness of alternative treatments in extending an individual’s life due to the individual’s age, 

disability, or terminal illness. 

‘‘(d)(1) The Secretary shall not use evidence or findings from 

comparative clinical effectiveness research conducted under section 

1181 in determining coverage, reimbursement, or incentive programs under title XVIII in a manner that precludes, or with the 

intent to discourage, an individual from choosing a health care 

treatment based on how the individual values the tradeoff between 

extending the length of their life and the risk of disability. 

‘‘(2)(A) Paragraph (1) shall not be construed to— 
H. R. 3590—623 

‘‘(i) limit the application of differential copayments under 

title XVIII based on factors such as cost or type of service; 

or 

‘‘(ii) prevent the Secretary from using evidence or findings 

from such comparative clinical effectiveness research in determining coverage, reimbursement, or incentive programs under 

such title based upon a comparison of the difference in the 

effectiveness of alternative health care treatments in extending 

an individual’s life due to that individual’s age, disability, or 

terminal illness. 

‘‘(3) Nothing in the provisions of, or amendments made by 

the Patient Protection and Affordable Care Act, shall be construed 

to limit comparative clinical effectiveness research or any other 

research, evaluation, or dissemination of information concerning 

the likelihood that a health care treatment will result in disability. 

‘‘(e) The Patient-Centered Outcomes Research Institute established under section 1181(b)(1) shall not develop or employ a dollarsper-quality adjusted life year (or similar measure that discounts 

the value of a life because of an individual’s disability) as a 

threshold to establish what type of health care is cost effective 

or recommended. The Secretary shall not utilize such an adjusted 

life year (or such a similar measure) as a threshold to determine 

coverage, reimbursement, or incentive programs under title XVIII.’’. 

(d) IN GENERAL.—Part D of title XI of the Social Security 

Act, as added by subsection (a) and amended by subsection (c), 

is amended by adding at the end the following new section: 

‘‘TRUST FUND TRANSFERS TO PATIENT-CENTERED OUTCOMES

RESEARCH TRUST FUND

‘‘SEC. 1183. (a) IN GENERAL.—The Secretary shall provide for 

the transfer, from the Federal Hospital Insurance Trust Fund under 

section 1817 and the Federal Supplementary Medical Insurance 

Trust Fund under section 1841, in proportion (as estimated by 

the Secretary) to the total expenditures during such fiscal year 

that are made under title XVIII from the respective trust fund, 

to the Patient-Centered Outcomes Research Trust Fund (referred 

to in this section as the ‘PCORTF’) under section 9511 of the 

Internal Revenue Code of 1986, of the following: ‘‘(1) For fiscal year 2013, an amount equal to $1 multiplied 

by the average number of individuals entitled to benefits under 

part A, or enrolled under part B, of title XVIII during such 

fiscal year. 

‘‘(2) For each of fiscal years 2014, 2015, 2016, 2017, 2018, and 2019, an amount equal to $2 multiplied by the average 

number of individuals entitled to benefits under part A, or 

enrolled under part B, of title XVIII during such fiscal year. 

‘‘(b) ADJUSTMENTS FOR INCREASES IN HEALTH CARE SPENDING.— In the case of any fiscal year beginning after September 30, 2014, 

the dollar amount in effect under subsection (a)(2) for such fiscal 

year shall be equal to the sum of such dollar amount for the 

previous fiscal year (determined after the application of this subsection), plus an amount equal to the product of— 

‘‘(1) such dollar amount for the previous fiscal year, multiplied by 

‘‘(2) the percentage increase in the projected per capita 

amount of National Health Expenditures, as most recently published by the Secretary before the beginning of the fiscal year.’’. 
H. R. 3590—624 

(e) PATIENT-CENTERED OUTCOMES RESEARCH TRUST FUND; 

FINANCING FOR TRUST FUND.— 

(1) ESTABLISHMENT OF TRUST FUND.— 

(A) IN GENERAL.—Subchapter A of chapter 98 of the 

Internal Revenue Code of 1986 (relating to establishment 

of trust funds) is amended by adding at the end the following new section: 

‘‘SEC. 9511. PATIENT-CENTERED OUTCOMES RESEARCH TRUST FUND. 

‘‘(a) CREATION OF TRUST FUND.—There is established in the 

Treasury of the United States a trust fund to be known as the 

‘Patient-Centered Outcomes Research Trust Fund’ (hereafter in this 

section referred to as the ‘PCORTF’), consisting of such amounts 

as may be appropriated or credited to such Trust Fund as provided 

in this section and section 9602(b). 

‘‘(b) TRANSFERS TO FUND.— 

‘‘(1) APPROPRIATION.—There are hereby appropriated to the 

Trust Fund the following: 

‘‘(A) For fiscal year 2010, $10,000,000. 

‘‘(B) For fiscal year 2011, $50,000,000. 

‘‘(C) For fiscal year 2012, $150,000,000. 

‘‘(D) For fiscal year 2013— 

‘‘(i) an amount equivalent to the net revenues 

received in the Treasury from the fees imposed under 

subchapter B of chapter 34 (relating to fees on health 

insurance and self-insured plans) for such fiscal year; 

and 

‘‘(ii) $150,000,000. 

‘‘(E) For each of fiscal years 2014, 2015, 2016, 2017, 

2018, and 2019— 

‘‘(i) an amount equivalent to the net revenues 

received in the Treasury from the fees imposed under 

subchapter B of chapter 34 (relating to fees on health 

insurance and self-insured plans) for such fiscal year; 

and 

‘‘(ii) $150,000,000. 

The amounts appropriated under subparagraphs (A), (B), 

(C), (D)(ii), and (E)(ii) shall be transferred from the general 

fund of the Treasury, from funds not otherwise appropriated. 

‘‘(2) TRUST FUND TRANSFERS.—In addition to the amounts 

appropriated under paragraph (1), there shall be credited to 

the PCORTF the amounts transferred under section 1183 of 

the Social Security Act. 

‘‘(3) LIMITATION ON TRANSFERS TO PCORTF.—No amount 

may be appropriated or transferred to the PCORTF on and 

after the date of any expenditure from the PCORTF which 

is not an expenditure permitted under this section. The determination of whether an expenditure is so permitted shall be 

made without regard to— 

‘‘(A) any provision of law which is not contained or 

referenced in this chapter or in a revenue Act, and 

‘‘(B) whether such provision of law is a subsequently 

enacted provision or directly or indirectly seeks to waive 

the application of this paragraph. 

‘‘(c) TRUSTEE.—The Secretary of the Treasury shall be a trustee 

of the PCORTF. 
H. R. 3590—625 

‘‘(d) EXPENDITURES FROM FUND.— 

‘‘(1) AMOUNTS AVAILABLE TO THE PATIENT-CENTERED OUTCOMES RESEARCH INSTITUTE.—Subject to paragraph (2), 

amounts in the PCORTF are available, without further appropriation, to the Patient-Centered Outcomes Research Institute 

established under section 1181(b) of the Social Security Act 

for carrying out part D of title XI of the Social Security Act 

(as in effect on the date of enactment of such Act). 

‘‘(2) TRANSFER OF FUNDS.— 

‘‘(A) IN GENERAL.—The trustee of the PCORTF shall 

provide for the transfer from the PCORTF of 20 percent 

of the amounts appropriated or credited to the PCORTF 

for each of fiscal years 2011 through 2019 to the Secretary 

of Health and Human Services to carry out section 937 

of the Public Health Service Act. 

‘‘(B) AVAILABILITY.—Amounts transferred under 

subparagraph (A) shall remain available until expended. 

‘‘(C) REQUIREMENTS.—Of the amounts transferred 

under subparagraph (A) with respect to a fiscal year, the 

Secretary of Health and Human Services shall distribute— 

‘‘(i) 80 percent to the Office of Communication 

and Knowledge Transfer of the Agency for Healthcare 

Research and Quality (or any other relevant office 

designated by Agency for Healthcare Research and 

Quality) to carry out the activities described in section 

937 of the Public Health Service Act; and 

‘‘(ii) 20 percent to the Secretary to carry out the 

activities described in such section 937. 

‘‘(e) NET REVENUES.—For purposes of this section, the term 

‘net revenues’ means the amount estimated by the Secretary of 

the Treasury based on the excess of— 

‘‘(1) the fees received in the Treasury under subchapter 

B of chapter 34, over 

‘‘(2) the decrease in the tax imposed by chapter 1 resulting 

from the fees imposed by such subchapter. 

‘‘(f) TERMINATION.—No amounts shall be available for expenditure from the PCORTF after September 30, 2019, and any amounts 

in such Trust Fund after such date shall be transferred to the 

general fund of the Treasury.’’. 

(B) CLERICAL AMENDMENT.—The table of sections for 

subchapter A of chapter 98 of such Code is amended by 

adding at the end the following new item: 

‘‘Sec. 9511. Patient-centered outcomes research trust fund.’’. 

(2) FINANCING FOR FUND FROM FEES ON INSURED AND SELFINSURED HEALTH PLANS.— 

(A) GENERAL RULE.—Chapter 34 of the Internal Revenue Code of 1986 is amended by adding at the end the 

following new subchapter: 

‘‘Subchapter B—Insured and Self-Insured Health Plans 

‘‘Sec. 4375. Health insurance. 

‘‘Sec. 4376. Self-insured health plans. 

‘‘Sec. 4377. Definitions and special rules. 

‘‘SEC. 4375. HEALTH INSURANCE. 

‘‘(a) IMPOSITION OF FEE.—There is hereby imposed on each 

specified health insurance policy for each policy year ending after 
H. R. 3590—626 

September 30, 2012, a fee equal to the product of $2 ($1 in the 

case of policy years ending during fiscal year 2013) multiplied 

by the average number of lives covered under the policy. 

‘‘(b) LIABILITY FOR FEE.—The fee imposed by subsection (a) 

shall be paid by the issuer of the policy. 

‘‘(c) SPECIFIED HEALTH INSURANCE POLICY.—For purposes of 

this section: 

‘‘(1) IN GENERAL.—Except as otherwise provided in this 

section, the term ‘specified health insurance policy’ means any 

accident or health insurance policy (including a policy under 

a group health plan) issued with respect to individuals residing 

in the United States. 

‘‘(2) EXEMPTION FOR CERTAIN POLICIES.—The term ‘specified 

health insurance policy’ does not include any insurance if 

substantially all of its coverage is of excepted benefits described 

in section 9832(c). 

‘‘(3) TREATMENT OF PREPAID HEALTH COVERAGE ARRANGEMENTS.— 

‘‘(A) IN GENERAL.—In the case of any arrangement 

described in subparagraph (B), such arrangement shall 

be treated as a specified health insurance policy, and the 

person referred to in such subparagraph shall be treated 

as the issuer. 

‘‘(B) DESCRIPTION OF ARRANGEMENTS.—An arrangement is described in this subparagraph if under such 

arrangement fixed payments or premiums are received as 

consideration for any person’s agreement to provide or 

arrange for the provision of accident or health coverage 

to residents of the United States, regardless of how such 

coverage is provided or arranged to be provided. 

‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH CARE

SPENDING.—In the case of any policy year ending in any fiscal 

year beginning after September 30, 2014, the dollar amount in 

effect under subsection (a) for such policy year shall be equal 

to the sum of such dollar amount for policy years ending in the 

previous fiscal year (determined after the application of this subsection), plus an amount equal to the product of— 

‘‘(1) such dollar amount for policy years ending in the 

previous fiscal year, multiplied by 

‘‘(2) the percentage increase in the projected per capita 

amount of National Health Expenditures, as most recently published by the Secretary before the beginning of the fiscal year. 

‘‘(e) TERMINATION.—This section shall not apply to policy years 

ending after September 30, 2019. 

‘‘SEC. 4376. SELF-INSURED HEALTH PLANS. 

‘‘(a) IMPOSITION OF FEE.—In the case of any applicable selfinsured health plan for each plan year ending after September 

30, 2012, there is hereby imposed a fee equal to $2 ($1 in the 

case of plan years ending during fiscal year 2013) multiplied by 

the average number of lives covered under the plan. 

‘‘(b) LIABILITY FOR FEE.— 

‘‘(1) IN GENERAL.—The fee imposed by subsection (a) shall 

be paid by the plan sponsor. 

‘‘(2) PLAN SPONSOR.—For purposes of paragraph (1) the 

term ‘plan sponsor’ means— 
H. R. 3590—627 

‘‘(A) the employer in the case of a plan established 

or maintained by a single employer, 

‘‘(B) the employee organization in the case of a plan 

established or maintained by an employee organization, 

‘‘(C) in the case of— 

‘‘(i) a plan established or maintained by 2 or more 

employers or jointly by 1 or more employers and 1 

or more employee organizations, 

‘‘(ii) a multiple employer welfare arrangement, or 

‘‘(iii) a voluntary employees’ beneficiary association 

described in section 501(c)(9), the association, committee, joint board of trustees, or other similar group 

of representatives of the parties who establish or maintain the plan, or 

‘‘(D) the cooperative or association described in subsection (c)(2)(F) in the case of a plan established or maintained by such a cooperative or association. 

‘‘(c) APPLICABLE SELF-INSURED HEALTH PLAN.—For purposes 

of this section, the term ‘applicable self-insured health plan’ means 

any plan for providing accident or health coverage if— 

‘‘(1) any portion of such coverage is provided other than 

through an insurance policy, and 

‘‘(2) such plan is established or maintained— 

‘‘(A) by 1 or more employers for the benefit of their 

employees or former employees, 

‘‘(B) by 1 or more employee organizations for the benefit 

of their members or former members, 

‘‘(C) jointly by 1 or more employers and 1 or more 

employee organizations for the benefit of employees or 

former employees, 

‘‘(D) by a voluntary employees’ beneficiary association 

described in section 501(c)(9), 

‘‘(E) by any organization described in section 501(c)(6), 

or 

‘‘(F) in the case of a plan not described in the preceding 

subparagraphs, by a multiple employer welfare arrangement (as defined in section 3(40) of Employee Retirement 

Income Security Act of 1974), a rural electric cooperative 

(as defined in section 3(40)(B)(iv) of such Act), or a rural 

telephone cooperative association (as defined in section 

3(40)(B)(v) of such Act). 

‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH CARE

SPENDING.—In the case of any plan year ending in any fiscal 

year beginning after September 30, 2014, the dollar amount in 

effect under subsection (a) for such plan year shall be equal to 

the sum of such dollar amount for plan years ending in the previous 

fiscal year (determined after the application of this subsection), 

plus an amount equal to the product of— 

‘‘(1) such dollar amount for plan years ending in the previous fiscal year, multiplied by 

‘‘(2) the percentage increase in the projected per capita 

amount of National Health Expenditures, as most recently published by the Secretary before the beginning of the fiscal year. 

‘‘(e) TERMINATION.—This section shall not apply to plan years 

ending after September 30, 2019. 
H. R. 3590—628 

‘‘SEC. 4377. DEFINITIONS AND SPECIAL RULES. 

‘‘(a) DEFINITIONS.—For purposes of this subchapter— 

‘‘(1) ACCIDENT AND HEALTH COVERAGE.—The term ‘accident 

and health coverage’ means any coverage which, if provided 

by an insurance policy, would cause such policy to be a specified 

health insurance policy (as defined in section 4375(c)). 

‘‘(2) INSURANCE POLICY.—The term ‘insurance policy’ means 

any policy or other instrument whereby a contract of insurance 

is issued, renewed, or extended. 

‘‘(3) UNITED STATES.—The term ‘United States’ includes 

any possession of the United States. 

‘‘(b) TREATMENT OF GOVERNMENTAL ENTITIES.— 

‘‘(1) IN GENERAL.—For purposes of this subchapter— 

‘‘(A) the term ‘person’ includes any governmental 

entity, and 

‘‘(B) notwithstanding any other law or rule of law, 

governmental entities shall not be exempt from the fees 

imposed by this subchapter except as provided in paragraph 

(2). 

‘‘(2) TREATMENT OF EXEMPT GOVERNMENTAL PROGRAMS.— 

In the case of an exempt governmental program, no fee shall 

be imposed under section 4375 or section 4376 on any covered 

life under such program. 

‘‘(3) EXEMPT GOVERNMENTAL PROGRAM DEFINED.—For purposes of this subchapter, the term ‘exempt governmental program’ means— 

‘‘(A) any insurance program established under title 

XVIII of the Social Security Act, 

‘‘(B) the medical assistance program established by 

title XIX or XXI of the Social Security Act, 

‘‘(C) any program established by Federal law for providing medical care (other than through insurance policies) 

to individuals (or the spouses and dependents thereof) by 

reason of such individuals being members of the Armed 

Forces of the United States or veterans, and 

‘‘(D) any program established by Federal law for providing medical care (other than through insurance policies) 

to members of Indian tribes (as defined in section 4(d) 

of the Indian Health Care Improvement Act). 

‘‘(c) TREATMENT AS TAX.—For purposes of subtitle F, the fees 

imposed by this subchapter shall be treated as if they were taxes. 

‘‘(d) NO COVER OVER TO POSSESSIONS.—Notwithstanding any 

other provision of law, no amount collected under this subchapter 

shall be covered over to any possession of the United States.’’. 

(B) CLERICAL AMENDMENTS.— 

(i) Chapter 34 of such Code is amended by striking 

the chapter heading and inserting the following: 
H. R. 3590—629 

‘‘CHAPTER 34—TAXES ON CERTAIN INSURANCE 

POLICIES 

‘‘SUBCHAPTER A. POLICIES ISSUED BY FOREIGN INSURERS

‘‘SUBCHAPTER B. INSURED AND SELF-INSURED HEALTH PLANS

‘‘Subchapter A—Policies Issued By Foreign Insurers’’. 

(ii) The table of chapters for subtitle D of such 

Code is amended by striking the item relating to 

chapter 34 and inserting the following new item: 

‘‘CHAPTER 34—TAXES ON CERTAIN INSURANCE POLICIES’’. 

(f) TAX-EXEMPT STATUS OF THE PATIENT-CENTERED OUTCOMES

RESEARCH INSTITUTE.—Subsection 501(l) of the Internal Revenue 

Code of 1986 is amended by adding at the end the following new 

paragraph: 

‘‘(4) The Patient-Centered Outcomes Research Institute 

established under section 1181(b) of the Social Security Act.’’. 

SEC. 6302. FEDERAL COORDINATING COUNCIL FOR COMPARATIVE 

EFFECTIVENESS RESEARCH. 

Notwithstanding any other provision of law, the Federal Coordinating Council for Comparative Effectiveness Research established 

under section 804 of Division A of the American Recovery and 

Reinvestment Act of 2009 (42 U.S.C. 299b–8), including the requirement under subsection (e)(2) of such section, shall terminate on 

the date of enactment of this Act. 

Subtitle E—Medicare, Medicaid, and CHIP 

Program Integrity Provisions 

SEC. 6401. PROVIDER SCREENING AND OTHER ENROLLMENT REQUIREMENTS UNDER MEDICARE, MEDICAID, AND CHIP. 

(a) MEDICARE.—Section 1866(j) of the Social Security Act (42 

U.S.C. 1395cc(j)) is amended— 

(1) in paragraph (1)(A), by adding at the end the following: 

‘‘Such process shall include screening of providers and suppliers 

in accordance with paragraph (2), a provisional period of 

enhanced oversight in accordance with paragraph (3), disclosure 

requirements in accordance with paragraph (4), the imposition 

of temporary enrollment moratoria in accordance with paragraph (5), and the establishment of compliance programs in 

accordance with paragraph (6).’’; 

(2) by redesignating paragraph (2) as paragraph (7); and 

(3) by inserting after paragraph (1) the following: 

‘‘(2) PROVIDER SCREENING.— 

‘‘(A) PROCEDURES.—Not later than 180 days after the 

date of enactment of this paragraph, the Secretary, in 

consultation with the Inspector General of the Department 

of Health and Human Services, shall establish procedures 

under which screening is conducted with respect to providers of medical or other items or services and suppliers 

under the program under this title, the Medicaid program 

under title XIX, and the CHIP program under title XXI. 
H. R. 3590—630 

‘‘(B) LEVEL OF SCREENING.—The Secretary shall determine the level of screening conducted under this paragraph 

according to the risk of fraud, waste, and abuse, as determined by the Secretary, with respect to the category of 

provider of medical or other items or services or supplier. 

Such screening— 

‘‘(i) shall include a licensure check, which may 

include such checks across States; and 

‘‘(ii) may, as the Secretary determines appropriate 

based on the risk of fraud, waste, and abuse described 

in the preceding sentence, include— 

‘‘(I) a criminal background check; 

‘‘(II) fingerprinting; 

‘‘(III) unscheduled and unannounced site 

visits, including preenrollment site visits; 

‘‘(IV) database checks (including such checks 

across States); and 

‘‘(V) such other screening as the Secretary 

determines appropriate. 

‘‘(C) APPLICATION FEES.— 

‘‘(i) INDIVIDUAL PROVIDERS.—Except as provided in 

clause (iii), the Secretary shall impose a fee on each 

individual provider of medical or other items or services 

or supplier (such as a physician, physician assistant, 

nurse practitioner, or clinical nurse specialist) with 

respect to which screening is conducted under this 

paragraph in an amount equal to— ‘‘(I) for 2010, $200; and 

‘‘(II) for 2011 and each subsequent year, the 

amount determined under this clause for the preceding year, adjusted by the percentage change 

in the consumer price index for all urban consumers (all items; United States city average) for 

the 12-month period ending with June of the previous year. 

‘‘(ii) INSTITUTIONAL PROVIDERS.—Except as provided in clause (iii), the Secretary shall impose a fee 

on each institutional provider of medical or other items 

or services or supplier (such as a hospital or skilled 

nursing facility) with respect to which screening is 

conducted under this paragraph in an amount equal 

to— 

‘‘(I) for 2010, $500; and 

‘‘(II) for 2011 and each subsequent year, the 

amount determined under this clause for the preceding year, adjusted by the percentage change 

in the consumer price index for all urban consumers (all items; United States city average) for 

the 12-month period ending with June of the previous year. 

‘‘(iii) HARDSHIP EXCEPTION; WAIVER FOR CERTAIN

MEDICAID PROVIDERS.—The Secretary may, on a caseby-case basis, exempt a provider of medical or other 

items or services or supplier from the imposition of 

an application fee under this subparagraph if the Secretary determines that the imposition of the application 

fee would result in a hardship. The Secretary may 
H. R. 3590—631 

waive the application fee under this subparagraph for 

providers enrolled in a State Medicaid program for 

whom the State demonstrates that imposition of the 

fee would impede beneficiary access to care. 

‘‘(iv) USE OF FUNDS.—Amounts collected as a result 

of the imposition of a fee under this subparagraph 

shall be used by the Secretary for program integrity 

efforts, including to cover the costs of conducting 

screening under this paragraph and to carry out this 

subsection and section 1128J. 

‘‘(D) APPLICATION AND ENFORCEMENT.— ‘‘(i) NEW PROVIDERS OF SERVICES AND SUPPLIERS.— 

The screening under this paragraph shall apply, in 

the case of a provider of medical or other items or 

services or supplier who is not enrolled in the program 

under this title, title XIX , or title XXI as of the 

date of enactment of this paragraph, on or after the 

date that is 1 year after such date of enactment. 

‘‘(ii) CURRENT PROVIDERS OF SERVICES AND SUPPLIERS.—The screening under this paragraph shall 

apply, in the case of a provider of medical or other 

items or services or supplier who is enrolled in the 

program under this title, title XIX, or title XXI as 

of such date of enactment, on or after the date that 

is 2 years after such date of enactment. 

‘‘(iii) REVALIDATION OF ENROLLMENT.—Effective 

beginning on the date that is 180 days after such 

date of enactment, the screening under this paragraph 

shall apply with respect to the revalidation of enrollment of a provider of medical or other items or services 

or supplier in the program under this title, title XIX, 

or title XXI. 

‘‘(iv) LIMITATION ON ENROLLMENT AND REVALIDA- TION OF ENROLLMENT.—In no case may a provider of 

medical or other items or services or supplier who 

has not been screened under this paragraph be initially 

enrolled or reenrolled in the program under this title, 

title XIX, or title XXI on or after the date that is 

3 years after such date of enactment. 

‘‘(E) EXPEDITED RULEMAKING.—The Secretary may 

promulgate an interim final rule to carry out this paragraph. 

‘‘(3) PROVISIONAL PERIOD OF ENHANCED OVERSIGHT FOR NEW

PROVIDERS OF SERVICES AND SUPPLIERS.— 

‘‘(A) IN GENERAL.—The Secretary shall establish procedures to provide for a provisional period of not less than 

30 days and not more than 1 year during which new 

providers of medical or other items or services and suppliers, as the Secretary determines appropriate, including 

categories of providers or suppliers, would be subject to 

enhanced oversight, such as prepayment review and payment caps, under the program under this title, the Medicaid 

program under title XIX. and the CHIP program under 

title XXI. 

‘‘(B) IMPLEMENTATION.—The Secretary may establish 

by program instruction or otherwise the procedures under 

this paragraph. 
H. R. 3590—632 

‘‘(4) INCREASED DISCLOSURE REQUIREMENTS.— 

‘‘(A) DISCLOSURE.—A provider of medical or other items 

or services or supplier who submits an application for 

enrollment or revalidation of enrollment in the program 

under this title, title XIX, or title XXI on or after the 

date that is 1 year after the date of enactment of this 

paragraph shall disclose (in a form and manner and at 

such time as determined by the Secretary) any current 

or previous affiliation (directly or indirectly) with a provider 

of medical or other items or services or supplier that has 

uncollected debt, has been or is subject to a payment 

suspension under a Federal health care program (as defined 

in section 1128B(f)), has been excluded from participation 

under the program under this title, the Medicaid program 

under title XIX, or the CHIP program under title XXI, 

or has had its billing privileges denied or revoked. 

‘‘(B) AUTHORITY TO DENY ENROLLMENT.—If the Secretary determines that such previous affiliation poses an 

undue risk of fraud, waste, or abuse, the Secretary may 

deny such application. Such a denial shall be subject to 

appeal in accordance with paragraph (7). 

‘‘(5) AUTHORITY TO ADJUST PAYMENTS OF PROVIDERS OF

SERVICES AND SUPPLIERS WITH THE SAME TAX IDENTIFICATION

NUMBER FOR PAST-DUE OBLIGATIONS.— 

‘‘(A) IN GENERAL.—Notwithstanding any other provision of this title, in the case of an applicable provider 

of services or supplier, the Secretary may make any necessary adjustments to payments to the applicable provider 

of services or supplier under the program under this title 

in order to satisfy any past-due obligations described in 

subparagraph (B)(ii) of an obligated provider of services 

or supplier. 

‘‘(B) DEFINITIONS.—In this paragraph: 

‘‘(i) IN GENERAL.—The term ‘applicable provider 

of services or supplier’ means a provider of services 

or supplier that has the same taxpayer identification 

number assigned under section 6109 of the Internal 

Revenue Code of 1986 as is assigned to the obligated 

provider of services or supplier under such section, 

regardless of whether the applicable provider of services or supplier is assigned a different billing number 

or national provider identification number under the 

program under this title than is assigned to the obligated provider of services or supplier. 

‘‘(ii) OBLIGATED PROVIDER OF SERVICES OR SUPPLIER.—The term ‘obligated provider of services or supplier’ means a provider of services or supplier that 

owes a past-due obligation under the program under 

this title (as determined by the Secretary). 

‘‘(6) TEMPORARY MORATORIUM ON ENROLLMENT OF NEW PROVIDERS.— 

‘‘(A) IN GENERAL.—The Secretary may impose a temporary moratorium on the enrollment of new providers 

of services and suppliers, including categories of providers 

of services and suppliers, in the program under this title, 

under the Medicaid program under title XIX, or under 
H. R. 3590—633 

the CHIP program under title XXI if the Secretary determines such moratorium is necessary to prevent or combat 

fraud, waste, or abuse under either such program. 

‘‘(B) LIMITATION ON REVIEW.—There shall be no judicial 

review under section 1869, section 1878, or otherwise, of 

a temporary moratorium imposed under subparagraph (A). 

‘‘(7) COMPLIANCE PROGRAMS.— 

‘‘(A) IN GENERAL.—On or after the date of implementation determined by the Secretary under subparagraph (C), 

a provider of medical or other items or services or supplier 

within a particular industry sector or category shall, as 

a condition of enrollment in the program under this title, 

title XIX, or title XXI, establish a compliance program 

that contains the core elements established under subparagraph (B) with respect to that provider or supplier and 

industry or category. 

‘‘(B) ESTABLISHMENT OF CORE ELEMENTS.—The Secretary, in consultation with the Inspector General of the 

Department of Health and Human Services, shall establish 

core elements for a compliance program under subparagraph (A) for providers or suppliers within a particular 

industry or category. 

‘‘(C) TIMELINE FOR IMPLEMENTATION.—The Secretary 

shall determine the timeline for the establishment of the 

core elements under subparagraph (B) and the date of 

the implementation of subparagraph (A) for providers or 

suppliers within a particular industry or category. The 

Secretary shall, in determining such date of implementation, consider the extent to which the adoption of compliance programs by a provider of medical or other items 

or services or supplier is widespread in a particular 

industry sector or with respect to a particular provider 

or supplier category.’’. 

(b) MEDICAID.— (1) STATE PLAN AMENDMENT.—Section 1902(a) of the Social 

Security Act (42 U.S.C. 1396a(a)), as amended by section 

4302(b), is amended— 

(A) in subsection (a)— 

(i) by striking ‘‘and’’ at the end of paragraph (75); 

(ii) by striking the period at the end of paragraph 

(76) and inserting a semicolon; and 

(iii) by inserting after paragraph (76) the following: 

‘‘(77) provide that the State shall comply with provider 

and supplier screening, oversight, and reporting requirements 

in accordance with subsection (ii);’’; and 

(B) by adding at the end the following: 

‘‘(ii) PROVIDER AND SUPPLIER SCREENING, OVERSIGHT, AND

REPORTING REQUIREMENTS.—For purposes of subsection (a)(77), the 

requirements of this subsection are the following: 

‘‘(1) SCREENING.—The State complies with the process for 

screening providers and suppliers under this title, as established by the Secretary under section 1886(j)(2). 

‘‘(2) PROVISIONAL PERIOD OF ENHANCED OVERSIGHT FOR NEW

PROVIDERS AND SUPPLIERS.—The State complies with procedures to provide for a provisional period of enhanced oversight 

for new providers and suppliers under this title, as established 

by the Secretary under section 1886(j)(3). 
H. R. 3590—634 

‘‘(3) DISCLOSURE REQUIREMENTS.—The State requires providers and suppliers under the State plan or under a waiver 

of the plan to comply with the disclosure requirements established by the Secretary under section 1886(j)(4). 

‘‘(4) TEMPORARY MORATORIUM ON ENROLLMENT OF NEW PROVIDERS OR SUPPLIERS.— 

‘‘(A) TEMPORARY MORATORIUM IMPOSED BY THE SECRETARY.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the State 

complies with any temporary moratorium on the enrollment of new providers or suppliers imposed by the 

Secretary under section 1886(j)(6). 

‘‘(ii) EXCEPTION.—A State shall not be required 

to comply with a temporary moratorium described in 

clause (i) if the State determines that the imposition 

of such temporary moratorium would adversely impact 

beneficiaries’ access to medical assistance. 

‘‘(B) MORATORIUM ON ENROLLMENT OF PROVIDERS AND

SUPPLIERS.—At the option of the State, the State imposes, 

for purposes of entering into participation agreements with 

providers or suppliers under the State plan or under a 

waiver of the plan, periods of enrollment moratoria, or 

numerical caps or other limits, for providers or suppliers 

identified by the Secretary as being at high-risk for fraud, 

waste, or abuse as necessary to combat fraud, waste, or 

abuse, but only if the State determines that the imposition 

of any such period, cap, or other limits would not adversely 

impact beneficiaries’ access to medical assistance. 

‘‘(5) COMPLIANCE PROGRAMS.—The State requires providers 

and suppliers under the State plan or under a waiver of the 

plan to establish, in accordance with the requirements of section 

1866(j)(7), a compliance program that contains the core elements established under subparagraph (B) of that section 

1866(j)(7) for providers or suppliers within a particular industry 

or category. 

‘‘(6) REPORTING OF ADVERSE PROVIDER ACTIONS.—The State 

complies with the national system for reporting criminal and 

civil convictions, sanctions, negative licensure actions, and other 

adverse provider actions to the Secretary, through the Administrator of the Centers for Medicare & Medicaid Services, in 

accordance with regulations of the Secretary. 

‘‘(7) ENROLLMENT AND NPI OF ORDERING OR REFERRING PROVIDERS.—The State requires— 

‘‘(A) all ordering or referring physicians or other professionals to be enrolled under the State plan or under a 

waiver of the plan as a participating provider; and 

‘‘(B) the national provider identifier of any ordering 

or referring physician or other professional to be specified 

on any claim for payment that is based on an order or 

referral of the physician or other professional. 

‘‘(8) OTHER STATE OVERSIGHT.—Nothing in this subsection 

shall be interpreted to preclude or limit the ability of a State 

to engage in provider and supplier screening or enhanced provider and supplier oversight activities beyond those required 

by the Secretary.’’. 

(2) DISCLOSURE OF MEDICARE TERMINATED PROVIDERS AND

SUPPLIERS TO STATES.—The Administrator of the Centers for 
H. R. 3590—635 

Medicare & Medicaid Services shall establish a process for 

making available to the each State agency with responsibility 

for administering a State Medicaid plan (or a waiver of such 

plan) under title XIX of the Social Security Act or a child 

health plan under title XXI the name, national provider identifier, and other identifying information for any provider of medical or other items or services or supplier under the Medicare 

program under title XVIII or under the CHIP program under 

title XXI that is terminated from participation under that program within 30 days of the termination (and, with respect 

to all such providers or suppliers who are terminated from 

the Medicare program on the date of enactment of this Act, 

within 90 days of such date). 

(3) CONFORMING AMENDMENT.—Section 1902(a)(23) of the 

Social Security Act (42 U.S.C. 1396a), is amended by inserting 

before the semicolon at the end the following: ‘‘or by a provider 

or supplier to which a moratorium under subsection (ii)(4) 

is applied during the period of such moratorium’’. 

(c) CHIP.—Section 2107(e)(1) of the Social Security Act (42 

U.S.C. 1397gg(e)(1)), as amended by section 2101(d), is amended— 

(1) by redesignating subparagraphs (D) through (M) as 

subparagraphs (E) through (N), respectively; and 

(2) by inserting after subparagraph (C), the following: 

‘‘(D) Subsections (a)(77) and (ii) of section 1902 

(relating to provider and supplier screening, oversight, and 

reporting requirements).’’. 

SEC. 6402. ENHANCED MEDICARE AND MEDICAID PROGRAM INTEGRITY PROVISIONS. 

(a) IN GENERAL.—Part A of title XI of the Social Security 

Act (42 U.S.C. 1301 et seq.), as amended by sections 6002, 6004, 

and 6102, is amended by inserting after section 1128I the following 

new section: 

‘‘SEC. 1128J. MEDICARE AND MEDICAID PROGRAM INTEGRITY PROVISIONS. 

‘‘(a) DATA MATCHING.— ‘‘(1) INTEGRATED DATA REPOSITORY.— ‘‘(A) INCLUSION OF CERTAIN DATA.— ‘‘(i) IN GENERAL.—The Integrated Data Repository 

of the Centers for Medicare & Medicaid Services shall 

include, at a minimum, claims and payment data from 

the following: 

‘‘(I) The programs under titles XVIII and XIX 

(including parts A, B, C, and D of title XVIII). 

‘‘(II) The program under title XXI. 

‘‘(III) Health-related programs administered 

by the Secretary of Veterans Affairs. 

‘‘(IV) Health-related programs administered by 

the Secretary of Defense. 

‘‘(V) The program of old-age, survivors, and 

disability insurance benefits established under 

title II. 

‘‘(VI) The Indian Health Service and the Contract Health Service program. 

‘‘(ii) PRIORITY FOR INCLUSION OF CERTAIN DATA.— Inclusion of the data described in subclause (I) of such 

clause in the Integrated Data Repository shall be a 
H. R. 3590—636 

priority. Data described in subclauses (II) through (VI) 

of such clause shall be included in the Integrated Data 

Repository as appropriate. 

‘‘(B) DATA SHARING AND MATCHING.— 

‘‘(i) IN GENERAL.—The Secretary shall enter into 

agreements with the individuals described in clause 

(ii) under which such individuals share and match 

data in the system of records of the respective agencies 

of such individuals with data in the system of records 

of the Department of Health and Human Services for 

the purpose of identifying potential fraud, waste, and 

abuse under the programs under titles XVIII and XIX. 

‘‘(ii) INDIVIDUALS DESCRIBED.—The following 

individuals are described in this clause: 

‘‘(I) The Commissioner of Social Security. 

‘‘(II) The Secretary of Veterans Affairs. 

‘‘(III) The Secretary of Defense. 

‘‘(IV) The Director of the Indian Health 

Service. 

‘‘(iii) DEFINITION OF SYSTEM OF RECORDS.—For purposes of this paragraph, the term ‘system of records’ 

has the meaning given such term in section 552a(a)(5) 

of title 5, United States Code. 

‘‘(2) ACCESS TO CLAIMS AND PAYMENT DATABASES.—For purposes of conducting law enforcement and oversight activities 

and to the extent consistent with applicable information, privacy, security, and disclosure laws, including the regulations 

promulgated under the Health Insurance Portability and 

Accountability Act of 1996 and section 552a of title 5, United 

States Code, and subject to any information systems security 

requirements under such laws or otherwise required by the 

Secretary, the Inspector General of the Department of Health 

and Human Services and the Attorney General shall have 

access to claims and payment data of the Department of Health 

and Human Services and its contractors related to titles XVIII, 

XIX, and XXI. 

‘‘(b) OIG AUTHORITY TO OBTAIN INFORMATION.— 

‘‘(1) IN GENERAL.—Notwithstanding and in addition to any 

other provision of law, the Inspector General of the Department 

of Health and Human Services may, for purposes of protecting 

the integrity of the programs under titles XVIII and XIX, 

obtain information from any individual (including a beneficiary 

provided all applicable privacy protections are followed) or 

entity that— 

‘‘(A) is a provider of medical or other items or services, 

supplier, grant recipient, contractor, or subcontractor; or 

‘‘(B) directly or indirectly provides, orders, manufactures, distributes, arranges for, prescribes, supplies, or 

receives medical or other items or services payable by 

any Federal health care program (as defined in section 

1128B(f)) regardless of how the item or service is paid 

for, or to whom such payment is made. 

‘‘(2) INCLUSION OF CERTAIN INFORMATION.—Information 

which the Inspector General may obtain under paragraph (1) 

includes any supporting documentation necessary to validate 

claims for payment or payments under title XVIII or XIX, 
H. R. 3590—637 

including a prescribing physician’s medical records for an individual who is prescribed an item or service which is covered 

under part B of title XVIII, a covered part D drug (as defined 

in section 1860D–2(e)) for which payment is made under an 

MA–PD plan under part C of such title, or a prescription 

drug plan under part D of such title, and any records necessary 

for evaluation of the economy, efficiency, and effectiveness of 

the programs under titles XVIII and XIX. 

‘‘(c) ADMINISTRATIVE REMEDY FOR KNOWING PARTICIPATION BY

BENEFICIARY IN HEALTH CARE FRAUD SCHEME.— ‘‘(1) IN GENERAL.—In addition to any other applicable remedies, if an applicable individual has knowingly participated 

in a Federal health care fraud offense or a conspiracy to commit 

a Federal health care fraud offense, the Secretary shall impose 

an appropriate administrative penalty commensurate with the 

offense or conspiracy. 

‘‘(2) APPLICABLE INDIVIDUAL.—For purposes of paragraph 

(1), the term ‘applicable individual’ means an individual— 

‘‘(A) entitled to, or enrolled for, benefits under part 

A of title XVIII or enrolled under part B of such title; 

‘‘(B) eligible for medical assistance under a State plan 

under title XIX or under a waiver of such plan; or 

‘‘(C) eligible for child health assistance under a child 

health plan under title XXI. 

‘‘(d) REPORTING AND RETURNING OF OVERPAYMENTS.— ‘‘(1) IN GENERAL.—If a person has received an overpayment, 

the person shall— 

‘‘(A) report and return the overpayment to the Secretary, the State, an intermediary, a carrier, or a contractor, as appropriate, at the correct address; and 

‘‘(B) notify the Secretary, State, intermediary, carrier, 

or contractor to whom the overpayment was returned in 

writing of the reason for the overpayment. 

‘‘(2) DEADLINE FOR REPORTING AND RETURNING OVERPAY- MENTS.—An overpayment must be reported and returned under 

paragraph (1) by the later of— 

‘‘(A) the date which is 60 days after the date on which 

the overpayment was identified; or 

‘‘(B) the date any corresponding cost report is due, 

if applicable. 

‘‘(3) ENFORCEMENT.—Any overpayment retained by a person after the deadline for reporting and returning the overpayment under paragraph (2) is an obligation (as defined in section 

3729(b)(3) of title 31, United States Code) for purposes of section 

3729 of such title. 

‘‘(4) DEFINITIONS.—In this subsection: 

‘‘(A) KNOWING AND KNOWINGLY.—The terms ‘knowing’ 

and ‘knowingly’ have the meaning given those terms in 

section 3729(b) of title 31, United States Code. 

‘‘(B) OVERPAYMENT.—The term ‘‘overpayment’’ means 

any funds that a person receives or retains under title 

XVIII or XIX to which the person, after applicable reconciliation, is not entitled under such title. 

‘‘(C) PERSON.— ‘‘(i) IN GENERAL.—The term ‘person’ means a provider of services, supplier, medicaid managed care 

organization (as defined in section 1903(m)(1)(A)), 
H. R. 3590—638 

Medicare Advantage organization (as defined in section 

1859(a)(1)), or PDP sponsor (as defined in section 

1860D–41(a)(13)). 

‘‘(ii) EXCLUSION.—Such term does not include a 

beneficiary. 

‘‘(e) INCLUSION OF NATIONAL PROVIDER IDENTIFIER ON ALL

APPLICATIONS AND CLAIMS.—The Secretary shall promulgate a regulation that requires, not later than January 1, 2011, all providers 

of medical or other items or services and suppliers under the 

programs under titles XVIII and XIX that qualify for a national 

provider identifier to include their national provider identifier on 

all applications to enroll in such programs and on all claims for 

payment submitted under such programs.’’. 

(b) ACCESS TO DATA.— 

(1) MEDICARE PART D.—Section 1860D–15(f)(2) of the Social 

Security Act (42 U.S.C. 1395w–116(f)(2)) is amended by striking 

‘‘may be used by’’ and all that follows through the period 

at the end and inserting ‘‘may be used— 

‘‘(A) by officers, employees, and contractors of the 

Department of Health and Human Services for the purposes of, and to the extent necessary in— 

‘‘(i) carrying out this section; and 

‘‘(ii) conducting oversight, evaluation, and enforcement under this title; and 

‘‘(B) by the Attorney General and the Comptroller General of the United States for the purposes of, and to the 

extent necessary in, carrying out health oversight activities.’’. 

(2) DATA MATCHING.—Section 552a(a)(8)(B) of title 5, 

United States Code, is amended— 

(A) in clause (vii), by striking ‘‘or’’ at the end; 

(B) in clause (viii), by inserting ‘‘or’’ after the semicolon; 

and 

(C) by adding at the end the following new clause: 

‘‘(ix) matches performed by the Secretary of Health 

and Human Services or the Inspector General of the 

Department of Health and Human Services with 

respect to potential fraud, waste, and abuse, including 

matches of a system of records with non-Federal 

records;’’. 

(3) MATCHING AGREEMENTS WITH THE COMMISSIONER OF

SOCIAL SECURITY.—Section 205(r) of the Social Security Act 

(42 U.S.C. 405(r)) is amended by adding at the end the following 

new paragraph: 

‘‘(9)(A) The Commissioner of Social Security shall, upon 

the request of the Secretary or the Inspector General of the 

Department of Health and Human Services— 

‘‘(i) enter into an agreement with the Secretary or 

such Inspector General for the purpose of matching data 

in the system of records of the Social Security Administration and the system of records of the Department of Health 

and Human Services; and 

‘‘(ii) include in such agreement safeguards to assure 

the maintenance of the confidentiality of any information 

disclosed. 
H. R. 3590—639 

‘‘(B) For purposes of this paragraph, the term ‘system of 

records’ has the meaning given such term in section 552a(a)(5) 

of title 5, United States Code.’’. 

(c) WITHHOLDING OF FEDERAL MATCHING PAYMENTS FOR STATES

THAT FAIL TO REPORT ENROLLEE ENCOUNTER DATA IN THE MEDICAID STATISTICAL INFORMATION SYSTEM.—Section 1903(i) of the 

Social Security Act (42 U.S.C. 1396b(i)) is amended— 

(1) in paragraph (23), by striking ‘‘or’’ at the end; 

(2) in paragraph (24), by striking the period at the end 

and inserting ‘‘; or’’; and 

(3) by adding at the end the following new paragraph:. 

‘‘(25) with respect to any amounts expended for medical 

assistance for individuals for whom the State does not report 

enrollee encounter data (as defined by the Secretary) to the 

Medicaid Statistical Information System (MSIS) in a timely 

manner (as determined by the Secretary).’’. 

(d) PERMISSIVE EXCLUSIONS AND CIVIL MONETARY PENALTIES.— 

(1) PERMISSIVE EXCLUSIONS.—Section 1128(b) of the Social 

Security Act (42 U.S.C. 1320a–7(b)) is amended by adding 

at the end the following new paragraph: 

‘‘(16) MAKING FALSE STATEMENTS OR MISREPRESENTATION

OF MATERIAL FACTS.—Any individual or entity that knowingly 

makes or causes to be made any false statement, omission, 

or misrepresentation of a material fact in any application, 

agreement, bid, or contract to participate or enroll as a provider 

of services or supplier under a Federal health care program 

(as defined in section 1128B(f)), including Medicare Advantage 

organizations under part C of title XVIII, prescription drug 

plan sponsors under part D of title XVIII, medicaid managed 

care organizations under title XIX, and entities that apply 

to participate as providers of services or suppliers in such 

managed care organizations and such plans.’’. 

(2) CIVIL MONETARY PENALTIES.— 

(A) IN GENERAL.—Section 1128A(a) of the Social Security Act (42 U.S.C. 1320a–7a(a)) is amended— 

(i) in paragraph (1)(D), by striking ‘‘was excluded’’ 

and all that follows through the period at the end 

and inserting ‘‘was excluded from the Federal health 

care program (as defined in section 1128B(f)) under 

which the claim was made pursuant to Federal law.’’; 

(ii) in paragraph (6), by striking ‘‘or’’ at the end; 

(iii) by inserting after paragraph (7), the following 

new paragraphs: 

‘‘(8) orders or prescribes a medical or other item or service 

during a period in which the person was excluded from a 

Federal health care program (as so defined), in the case where 

the person knows or should know that a claim for such medical 

or other item or service will be made under such a program; 

‘‘(9) knowingly makes or causes to be made any false statement, omission, or misrepresentation of a material fact in any 

application, bid, or contract to participate or enroll as a provider 

of services or a supplier under a Federal health care program 

(as so defined), including Medicare Advantage organizations 

under part C of title XVIII, prescription drug plan sponsors 

under part D of title XVIII, medicaid managed care organizations under title XIX, and entities that apply to participate 
H. R. 3590—640 

as providers of services or suppliers in such managed care 

organizations and such plans; 

‘‘(10) knows of an overpayment (as defined in paragraph 

(4) of section 1128J(d)) and does not report and return the 

overpayment in accordance with such section;’’; 

(iv) in the first sentence— 

(I) by striking the ‘‘or’’ after ‘‘prohibited relationship occurs;’’; and 

(II) by striking ‘‘act)’’ and inserting ‘‘act; or 

in cases under paragraph (9), $50,000 for each 

false statement or misrepresentation of a material 

fact)’’; and 

(v) in the second sentence, by striking ‘‘purpose)’’ 

and inserting ‘‘purpose; or in cases under paragraph 

(9), an assessment of not more than 3 times the total 

amount claimed for each item or service for which 

payment was made based upon the application containing the false statement or misrepresentation of 

a material fact)’’. 

(B) CLARIFICATION OF TREATMENT OF CERTAIN CHARITABLE AND OTHER INNOCUOUS PROGRAMS.—Section 

1128A(i)(6) of the Social Security Act (42 U.S.C. 1320a– 

7a(i)(6)) is amended— 

(i) in subparagraph (C), by striking ‘‘or’’ at the 

end; 

(ii) in subparagraph (D), as redesignated by section 

4331(e) of the Balanced Budget Act of 1997 (Public 

Law 105–33), by striking the period at the end and 

inserting a semicolon; 

(iii) by redesignating subparagraph (D), as added 

by section 4523(c) of such Act, as subparagraph (E) 

and striking the period at the end and inserting ‘‘; 

or’’; and 

(iv) by adding at the end the following new subparagraphs: 

‘‘(F) any other remuneration which promotes access 

to care and poses a low risk of harm to patients and 

Federal health care programs (as defined in section 

1128B(f) and designated by the Secretary under regulations); 

‘‘(G) the offer or transfer of items or services for free 

or less than fair market value by a person, if— 

‘‘(i) the items or services consist of coupons, 

rebates, or other rewards from a retailer; 

‘‘(ii) the items or services are offered or transferred 

on equal terms available to the general public, regardless of health insurance status; and 

‘‘(iii) the offer or transfer of the items or services 

is not tied to the provision of other items or services 

reimbursed in whole or in part by the program under 

title XVIII or a State health care program (as defined 

in section 1128(h)); 

‘‘(H) the offer or transfer of items or services for free 

or less than fair market value by a person, if— 

‘‘(i) the items or services are not offered as part 

of any advertisement or solicitation; 
H. R. 3590—641 

‘‘(ii) the items or services are not tied to the provision of other services reimbursed in whole or in part 

by the program under title XVIII or a State health 

care program (as so defined); 

‘‘(iii) there is a reasonable connection between the 

items or services and the medical care of the individual; 

and 

‘‘(iv) the person provides the items or services after 

determining in good faith that the individual is in 

financial need; or 

‘‘(I) effective on a date specified by the Secretary (but 

not earlier than January 1, 2011), the waiver by a PDP 

sponsor of a prescription drug plan under part D of title 

XVIII or an MA organization offering an MA–PD plan 

under part C of such title of any copayment for the first 

fill of a covered part D drug (as defined in section 1860D– 

2(e)) that is a generic drug for individuals enrolled in 

the prescription drug plan or MA–PD plan, respectively.’’. 

(e) TESTIMONIAL SUBPOENA AUTHORITY IN EXCLUSION-ONLY

CASES.—Section 1128(f) of the Social Security Act (42 U.S.C. 1320a– 

7(f)) is amended by adding at the end the following new paragraph: 

‘‘(4) The provisions of subsections (d) and (e) of section 

205 shall apply with respect to this section to the same extent 

as they are applicable with respect to title II. The Secretary 

may delegate the authority granted by section 205(d) (as made 

applicable to this section) to the Inspector General of the 

Department of Health and Human Services for purposes of 

any investigation under this section.’’. 

(f) HEALTH CARE FRAUD.— 

(1) KICKBACKS.—Section 1128B of the Social Security Act 

(42 U.S.C. 1320a–7b) is amended by adding at the end the 

following new subsection: 

‘‘(g) In addition to the penalties provided for in this section 

or section 1128A, a claim that includes items or services resulting 

from a violation of this section constitutes a false or fraudulent 

claim for purposes of subchapter III of chapter 37 of title 31, 

United States Code.’’. 

(2) REVISING THE INTENT REQUIREMENT.—Section 1128B 

of the Social Security Act (42 U.S.C. 1320a–7b), as amended 

by paragraph (1), is amended by adding at the end the following 

new subsection: 

‘‘(h) With respect to violations of this section, a person need 

not have actual knowledge of this section or specific intent to 

commit a violation of this section.’’. 

(g) SURETY BOND REQUIREMENTS.— 

(1) DURABLE MEDICAL EQUIPMENT.—Section 1834(a)(16)(B) 

of the Social Security Act (42 U.S.C. 1395m(a)(16)(B)) is 

amended by inserting ‘‘that the Secretary determines is 

commensurate with the volume of the billing of the supplier’’ 

before the period at the end. 

(2) HOME HEALTH AGENCIES.—Section 1861(o)(7)(C) of the 

Social Security Act (42 U.S.C. 1395x(o)(7)(C)) is amended by 

inserting ‘‘that the Secretary determines is commensurate with 

the volume of the billing of the home health agency’’ before 

the semicolon at the end. 

(3) REQUIREMENTS FOR CERTAIN OTHER PROVIDERS OF SERV- ICES AND SUPPLIERS.—Section 1862 of the Social Security Act 
H. R. 3590—642 

(42 U.S.C. 1395y) is amended by adding at the end the following 

new subsection: 

‘‘(n) REQUIREMENT OF A SURETY BOND FOR CERTAIN PROVIDERS

OF SERVICES AND SUPPLIERS.— 

‘‘(1) IN GENERAL.—The Secretary may require a provider 

of services or supplier described in paragraph (2) to provide 

the Secretary on a continuing basis with a surety bond in 

a form specified by the Secretary in an amount (not less than 

$50,000) that the Secretary determines is commensurate with 

the volume of the billing of the provider of services or supplier. 

The Secretary may waive the requirement of a bond under 

the preceding sentence in the case of a provider of services 

or supplier that provides a comparable surety bond under State 

law. 

‘‘(2) PROVIDER OF SERVICES OR SUPPLIER DESCRIBED.—A 

provider of services or supplier described in this paragraph 

is a provider of services or supplier the Secretary determines 

appropriate based on the level of risk involved with respect 

to the provider of services or supplier, and consistent with 

the surety bond requirements under sections 1834(a)(16)(B) 

and 1861(o)(7)(C).’’. 

(h) SUSPENSION OF MEDICARE AND MEDICAID PAYMENTS

PENDING INVESTIGATION OF CREDIBLE ALLEGATIONS OF FRAUD.— 

(1) MEDICARE.—Section 1862 of the Social Security Act 

(42 U.S.C. 1395y), as amended by subsection (g)(3), is amended 

by adding at the end the following new subsection: 

‘‘(o) SUSPENSION OF PAYMENTS PENDING INVESTIGATION OF

CREDIBLE ALLEGATIONS OF FRAUD.— ‘‘(1) IN GENERAL.—The Secretary may suspend payments 

to a provider of services or supplier under this title pending 

an investigation of a credible allegation of fraud against the 

provider of services or supplier, unless the Secretary determines 

there is good cause not to suspend such payments. 

‘‘(2) CONSULTATION.—The Secretary shall consult with the 

Inspector General of the Department of Health and Human 

Services in determining whether there is a credible allegation 

of fraud against a provider of services or supplier. 

‘‘(3) PROMULGATION OF REGULATIONS.—The Secretary shall 

promulgate regulations to carry out this subsection and section 

1903(i)(2)(C).’’. 

(2) MEDICAID.—Section 1903(i)(2) of such Act (42 U.S.C. 

1396b(i)(2)) is amended— 

(A) in subparagraph (A), by striking ‘‘or’’ at the end; 

and 

(B) by inserting after subparagraph (B), the following: 

‘‘(C) by any individual or entity to whom the State 

has failed to suspend payments under the plan during 

any period when there is pending an investigation of a 

credible allegation of fraud against the individual or entity, 

as determined by the State in accordance with regulations 

promulgated by the Secretary for purposes of section 

1862(o) and this subparagraph, unless the State determines 

in accordance with such regulations there is good cause 

not to suspend such payments; or’’. 

(i) INCREASED FUNDING TO FIGHT FRAUD AND ABUSE.— (1) IN GENERAL.—Section 1817(k) of the Social Security 

Act (42 U.S.C. 1395i(k)) is amended— 
H. R. 3590—643 

(A) by adding at the end the following new paragraph: 

‘‘(7) ADDITIONAL FUNDING.—In addition to the funds otherwise appropriated to the Account from the Trust Fund under 

paragraphs (3) and (4) and for purposes described in paragraphs 

(3)(C) and (4)(A), there are hereby appropriated an additional 

$10,000,000 to such Account from such Trust Fund for each 

of fiscal years 2011 through 2020. The funds appropriated 

under this paragraph shall be allocated in the same proportion 

as the total funding appropriated with respect to paragraphs 

(3)(A) and (4)(A) was allocated with respect to fiscal year 2010, 

and shall be available without further appropriation until 

expended.’’; and 

(B) in paragraph (4)(A), by inserting ‘‘until expended’’ 

after ‘‘appropriation’’. 

(2) INDEXING OF AMOUNTS APPROPRIATED.— 

(A) DEPARTMENTS OF HEALTH AND HUMAN SERVICES

AND JUSTICE.—Section 1817(k)(3)(A)(i) of the Social Security Act (42 U.S.C. 1395i(k)(3)(A)(i)) is amended— 

(i) in subclause (III), by inserting ‘‘and’’ at the 

end; 

(ii) in subclause (IV)— 

(I) by striking ‘‘for each of fiscal years 2007, 

2008, 2009, and 2010’’ and inserting ‘‘for each fiscal 

year after fiscal year 2006’’; and 

(II) by striking ‘‘; and’’ and inserting a period; 

and 

(iii) by striking subclause (V). 

(B) OFFICE OF THE INSPECTOR GENERAL OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES.—Section 

1817(k)(3)(A)(ii) of such Act (42 U.S.C. 1395i(k)(3)(A)(ii)) 

is amended— 

(i) in subclause (VIII), by inserting ‘‘and’’ at the 

end; 

(ii) in subclause (IX)— 

(I) by striking ‘‘for each of fiscal years 2008, 

2009, and 2010’’ and inserting ‘‘for each fiscal year 

after fiscal year 2007’’; and 

(II) by striking ‘‘; and’’ and inserting a period; 

and 

(iii) by striking subclause (X). 

(C) FEDERAL BUREAU OF INVESTIGATION.—Section 

1817(k)(3)(B) of the Social Security Act (42 U.S.C. 

1395i(k)(3)(B)) is amended— 

(i) in clause (vii), by inserting ‘‘and’’ at the end; 

(ii) in clause (viii)— 

(I) by striking ‘‘for each of fiscal years 2007, 

2008, 2009, and 2010’’ and inserting ‘‘for each fiscal 

year after fiscal year 2006’’; and 

(II) by striking ‘‘; and’’ and inserting a period; 

and 

(iii) by striking clause (ix). 

(D) MEDICARE INTEGRITY PROGRAM.—Section 

1817(k)(4)(C) of the Social Security Act (42 U.S.C. 

1395i(k)(4)(C)) is amended by adding at the end the following new clause: 

‘‘(ii) For each fiscal year after 2010, by the percentage increase in the consumer price index for all urban 
H. R. 3590—644 

consumers (all items; United States city average) over 

the previous year.’’. 

(j) MEDICARE INTEGRITY PROGRAM AND MEDICAID INTEGRITY

PROGRAM.— 

(1) MEDICARE INTEGRITY PROGRAM.— 

(A) REQUIREMENT TO PROVIDE PERFORMANCE STATISTICS.—Section 1893(c) of the Social Security Act (42 U.S.C. 

1395ddd(c)) is amended— 

(i) in paragraph (3), by striking ‘‘and’’ at the end; 

(ii) by redesignating paragraph (4) as paragraph 

(5); and 

(iii) by inserting after paragraph (3) the following 

new paragraph: 

‘‘(4) the entity agrees to provide the Secretary and the 

Inspector General of the Department of Health and Human 

Services with such performance statistics (including the number 

and amount of overpayments recovered, the number of fraud 

referrals, and the return on investment of such activities by 

the entity) as the Secretary or the Inspector General may 

request; and’’. 

(B) EVALUATIONS AND ANNUAL REPORT.—Section 1893 

of the Social Security Act (42 U.S.C. 1395ddd) is amended 

by adding at the end the following new subsection: 

‘‘(i) EVALUATIONS AND ANNUAL REPORT.— 

‘‘(1) EVALUATIONS.—The Secretary shall conduct evaluations of eligible entities which the Secretary contracts with 

under the Program not less frequently than every 3 years. 

‘‘(2) ANNUAL REPORT.—Not later than 180 days after the 

end of each fiscal year (beginning with fiscal year 2011), the 

Secretary shall submit a report to Congress which identifies— 

‘‘(A) the use of funds, including funds transferred from 

the Federal Hospital Insurance Trust Fund under section 

1817 and the Federal Supplementary Insurance Trust Fund 

under section 1841, to carry out this section; and 

‘‘(B) the effectiveness of the use of such funds.’’. 

(C) FLEXIBILITY IN PURSUING FRAUD AND ABUSE.—Section 1893(a) of the Social Security Act (42 U.S.C. 

1395ddd(a)) is amended by inserting ‘‘, or otherwise,’’ after 

‘‘entities’’. 

(2) MEDICAID INTEGRITY PROGRAM.— 

(A) REQUIREMENT TO PROVIDE PERFORMANCE STATISTICS.—Section 1936(c)(2) of the Social Security Act (42 

U.S.C. 1396u–6(c)(2)) is amended— 

(i) by redesignating subparagraph (D) as subparagraph (E); and 

(ii) by inserting after subparagraph (C) the following new subparagraph: 

‘‘(D) The entity agrees to provide the Secretary and 

the Inspector General of the Department of Health and 

Human Services with such performance statistics 

(including the number and amount of overpayments recovered, the number of fraud referrals, and the return on 

investment of such activities by the entity) as the Secretary 

or the Inspector General may request.’’. 

(B) EVALUATIONS AND ANNUAL REPORT.—Section 

1936(e) of the Social Security Act (42 U.S.C. 1396u–7(e)) 

is amended— 
H. R. 3590—645 

(i) by redesignating paragraph (4) as paragraph 

(5); and 

(ii) by inserting after paragraph (3) the following 

new paragraph: 

‘‘(4) EVALUATIONS.—The Secretary shall conduct evaluations of eligible entities which the Secretary contracts with 

under the Program not less frequently than every 3 years.’’. 

(k) EXPANDED APPLICATION OF HARDSHIP WAIVERS FOR EXCLUSIONS.—Section 1128(c)(3)(B) of the Social Security Act (42 U.S.C. 

1320a–7(c)(3)(B)) is amended by striking ‘‘individuals entitled to 

benefits under part A of title XVIII or enrolled under part B 

of such title, or both’’ and inserting ‘‘beneficiaries (as defined in 

section 1128A(i)(5)) of that program’’. 

SEC. 6403. ELIMINATION OF DUPLICATION BETWEEN THE 

HEALTHCARE INTEGRITY AND PROTECTION DATA BANK 

AND THE NATIONAL PRACTITIONER DATA BANK. 

(a) INFORMATION REPORTED BY FEDERAL AGENCIES AND HEALTH

PLANS.—Section 1128E of the Social Security Act (42 U.S.C. 1320a– 

7e) is amended— 

(1) by striking subsection (a) and inserting the following: 

‘‘(a) IN GENERAL.—The Secretary shall maintain a national 

health care fraud and abuse data collection program under this 

section for the reporting of certain final adverse actions (not 

including settlements in which no findings of liability have been 

made) against health care providers, suppliers, or practitioners 

as required by subsection (b), with access as set forth in subsection 

(d), and shall furnish the information collected under this section 

to the National Practitioner Data Bank established pursuant to 

the Health Care Quality Improvement Act of 1986 (42 U.S.C. 11101 

et seq.).’’; 

(2) by striking subsection (d) and inserting the following: 

‘‘(d) ACCESS TO REPORTED INFORMATION.— ‘‘(1) AVAILABILITY.—The information collected under this 

section shall be available from the National Practitioner Data 

Bank to the agencies, authorities, and officials which are provided under section 1921(b) information reported under section 

1921(a). 

‘‘(2) FEES FOR DISCLOSURE.—The Secretary may establish 

or approve reasonable fees for the disclosure of information 

under this section. The amount of such a fee may not exceed 

the costs of processing the requests for disclosure and of providing such information. Such fees shall be available to the 

Secretary to cover such costs.’’; 

(3) by striking subsection (f) and inserting the following: 

‘‘(f) APPROPRIATE COORDINATION.—In implementing this section, 

the Secretary shall provide for the maximum appropriate coordination with part B of the Health Care Quality Improvement Act 

of 1986 (42 U.S.C. 11131 et seq.) and section 1921.’’; and 

(4) in subsection (g)— 

(A) in paragraph (1)(A)— 

(i) in clause (iii)— 

(I) by striking ‘‘or State’’ each place it appears; 

(II) by redesignating subclauses (II) and (III) 

as subclauses (III) and (IV), respectively; and 

(III) by inserting after subclause (I) the following new subclause: 
H. R. 3590—646 

‘‘(II) any dismissal or closure of the proceedings by reason of the provider, supplier, or 

practitioner surrendering their license or leaving 

the State or jurisdiction’’; and 

(ii) by striking clause (iv) and inserting the following: 

‘‘(iv) Exclusion from participation in a Federal 

health care program (as defined in section 1128B(f)).’’; 

(B) in paragraph (3)— 

(i) by striking subparagraphs (D) and (E); and 

(ii) by redesignating subparagraph (F) as subparagraph (D); and 

(C) in subparagraph (D) (as so redesignated), by 

striking ‘‘or State’’. 

(b) INFORMATION REPORTED BY STATE LAW OR FRAUD ENFORCEMENT AGENCIES.—Section 1921 of the Social Security Act (42 U.S.C. 

1396r–2) is amended— 

(1) in subsection (a)— 

(A) in paragraph (1)— 

(i) by striking ‘‘SYSTEM.—The State’’ and all that 

follows through the semicolon and inserting SYSTEM.— 

‘‘(A) LICENSING OR CERTIFICATION ACTIONS.—The State 

must have in effect a system of reporting the following 

information with respect to formal proceedings (as defined 

by the Secretary in regulations) concluded against a health 

care practitioner or entity by a State licensing or certification agency:’’; 

(ii) by redesignating subparagraphs (A) through 

(D) as clauses (i) through (iv), respectively, and 

indenting appropriately; 

(iii) in subparagraph (A)(iii) (as so redesignated)— 

(I) by striking ‘‘the license of’’ and inserting 

‘‘license or the right to apply for, or renew, a 

license by’’; and 

(II) by inserting ‘‘nonrenewability,’’ after ‘‘voluntary surrender,’’; and 

(iv) by adding at the end the following new 

subparagraph: 

‘‘(B) OTHER FINAL ADVERSE ACTIONS.—The State must 

have in effect a system of reporting information with 

respect to any final adverse action (not including settlements in which no findings of liability have been made) 

taken against a health care provider, supplier, or practitioner by a State law or fraud enforcement agency.’’; and 

(B) in paragraph (2), by striking ‘‘the authority 

described in paragraph (1)’’ and inserting ‘‘a State licensing 

or certification agency or State law or fraud enforcement 

agency’’; 

(2) in subsection (b)— 

(A) by striking paragraph (2) and inserting the following: 

‘‘(2) to State licensing or certification agencies and Federal 

agencies responsible for the licensing and certification of health 

care providers, suppliers, and licensed health care practitioners;’’; 
H. R. 3590—647 

(B) in each of paragraphs (4) and (6), by inserting 

‘‘, but only with respect to information provided pursuant 

to subsection (a)(1)(A)’’ before the comma at the end; 

(C) by striking paragraph (5) and inserting the following: 

‘‘(5) to State law or fraud enforcement agencies,’’; 

(D) by redesignating paragraphs (7) and (8) as paragraphs (8) and (9), respectively; and 

(E) by inserting after paragraph (6) the following new 

paragraph: 

‘‘(7) to health plans (as defined in section 1128C(c));’’; 

(3) by redesignating subsection (d) as subsection (h), and 

by inserting after subsection (c) the following new subsections: 

‘‘(d) DISCLOSURE AND CORRECTION OF INFORMATION.— 

‘‘(1) DISCLOSURE.—With respect to information reported 

pursuant to subsection (a)(1), the Secretary shall— 

‘‘(A) provide for disclosure of the information, upon 

request, to the health care practitioner who, or the entity 

that, is the subject of the information reported; and 

‘‘(B) establish procedures for the case where the health 

care practitioner or entity disputes the accuracy of the 

information reported. 

‘‘(2) CORRECTIONS.—Each State licensing or certification 

agency and State law or fraud enforcement agency shall report 

corrections of information already reported about any formal 

proceeding or final adverse action described in subsection (a), 

in such form and manner as the Secretary prescribes by regulation. 

‘‘(e) FEES FOR DISCLOSURE.—The Secretary may establish or 

approve reasonable fees for the disclosure of information under 

this section. The amount of such a fee may not exceed the costs 

of processing the requests for disclosure and of providing such 

information. Such fees shall be available to the Secretary to cover 

such costs. 

‘‘(f) PROTECTION FROM LIABILITY FOR REPORTING.—No person 

or entity, including any agency designated by the Secretary in 

subsection (b), shall be held liable in any civil action with respect 

to any reporting of information as required under this section, 

without knowledge of the falsity of the information contained in 

the report. 

‘‘(g) REFERENCES.—For purposes of this section: 

‘‘(1) STATE LICENSING OR CERTIFICATION AGENCY.—The term 

‘State licensing or certification agency’ includes any authority 

of a State (or of a political subdivision thereof) responsible 

for the licensing of health care practitioners (or any peer review 

organization or private accreditation entity reviewing the services provided by health care practitioners) or entities. 

‘‘(2) STATE LAW OR FRAUD ENFORCEMENT AGENCY.—The 

term ‘State law or fraud enforcement agency’ includes— 

‘‘(A) a State law enforcement agency; and 

‘‘(B) a State medicaid fraud control unit (as defined 

in section 1903(q)). 

‘‘(3) FINAL ADVERSE ACTION.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the 

term ‘final adverse action’ includes— 
H. R. 3590—648 

‘‘(i) civil judgments against a health care provider, 

supplier, or practitioner in State court related to the 

delivery of a health care item or service; 

‘‘(ii) State criminal convictions related to the 

delivery of a health care item or service; 

‘‘(iii) exclusion from participation in State health 

care programs (as defined in section 1128(h)); 

‘‘(iv) any licensing or certification action described 

in subsection (a)(1)(A) taken against a supplier by a 

State licensing or certification agency; and 

‘‘(v) any other adjudicated actions or decisions that 

the Secretary shall establish by regulation. 

‘‘(B) EXCEPTION.—Such term does not include any 

action with respect to a malpractice claim.’’; and 

(4) in subsection (h), as so redesignated, by striking ‘‘The 

Secretary’’ and all that follows through the period at the end 

and inserting ‘‘In implementing this section, the Secretary shall 

provide for the maximum appropriate coordination with part 

B of the Health Care Quality Improvement Act of 1986 (42 

U.S.C. 11131 et seq.) and section 1128E.’’. 

(c) CONFORMING AMENDMENT.—Section 1128C(a)(1) of the 

Social Security Act (42 U.S.C. 1320a–7c(a)(1)) is amended— 

(1) in subparagraph (C), by adding ‘‘and’’ after the comma 

at the end; 

(2) in subparagraph (D), by striking ‘‘, and’’ and inserting 

a period; and 

(3) by striking subparagraph (E). 

(d) TRANSITION PROCESS; EFFECTIVE DATE.— (1) IN GENERAL.—Effective on the date of enactment of 

this Act, the Secretary of Health and Human Services (in 

this section referred to as the ‘‘Secretary’’) shall implement 

a transition process under which, by not later than the end 

of the transition period described in paragraph (5), the Secretary shall cease operating the Healthcare Integrity and 

Protection Data Bank established under section 1128E of the 

Social Security Act (as in effect before the effective date specified in paragraph (6)) and shall transfer all data collected 

in the Healthcare Integrity and Protection Data Bank to the 

National Practitioner Data Bank established pursuant to the 

Health Care Quality Improvement Act of 1986 (42 U.S.C. 11101 

et seq.). During such transition process, the Secretary shall 

have in effect appropriate procedures to ensure that data collection and access to the Healthcare Integrity and Protection 

Data Bank and the National Practitioner Data Bank are not 

disrupted. 

(2) REGULATIONS.—The Secretary shall promulgate regulations to carry out the amendments made by subsections (a) 

and (b). 

(3) FUNDING.— (A) AVAILABILITY OF FEES.—Fees collected pursuant 

to section 1128E(d)(2) of the Social Security Act prior to 

the effective date specified in paragraph (6) for the disclosure of information in the Healthcare Integrity and Protection Data Bank shall be available to the Secretary, without 

fiscal year limitation, for payment of costs related to the 

transition process described in paragraph (1). Any such 

fees remaining after the transition period is complete shall 
H. R. 3590—649 

be available to the Secretary, without fiscal year limitation, 

for payment of the costs of operating the National Practitioner Data Bank. 

(B) AVAILABILITY OF ADDITIONAL FUNDS.—In addition 

to the fees described in subparagraph (A), any funds available to the Secretary or to the Inspector General of the 

Department of Health and Human Services for a purpose 

related to combating health care fraud, waste, or abuse 

shall be available to the extent necessary for operating 

the Healthcare Integrity and Protection Data Bank during 

the transition period, including systems testing and other 

activities necessary to ensure that information formerly 

reported to the Healthcare Integrity and Protection Data 

Bank will be accessible through the National Practitioner 

Data Bank after the end of such transition period. 

(4) SPECIAL PROVISION FOR ACCESS TO THE NATIONAL

PRACTITIONER DATA BANK BY THE DEPARTMENT OF VETERANS

AFFAIRS.— 

(A) IN GENERAL.—Notwithstanding any other provision 

of law, during the 1-year period that begins on the effective 

date specified in paragraph (6), the information described 

in subparagraph (B) shall be available from the National 

Practitioner Data Bank to the Secretary of Veterans Affairs 

without charge. 

(B) INFORMATION DESCRIBED.—For purposes of 

subparagraph (A), the information described in this 

subparagraph is the information that would, but for the 

amendments made by this section, have been available 

to the Secretary of Veterans Affairs from the Healthcare 

Integrity and Protection Data Bank. 

(5) TRANSITION PERIOD DEFINED.—For purposes of this subsection, the term ‘‘transition period’’ means the period that 

begins on the date of enactment of this Act and ends on the 

later of— 

(A) the date that is 1 year after such date of enactment; 

or 

(B) the effective date of the regulations promulgated 

under paragraph (2). 

(6) EFFECTIVE DATE.—The amendments made by subsections (a), (b), and (c) shall take effect on the first day 

after the final day of the transition period. 

SEC. 6404. MAXIMUM PERIOD FOR SUBMISSION OF MEDICARE CLAIMS 

REDUCED TO NOT MORE THAN 12 MONTHS. 

(a) REDUCING MAXIMUM PERIOD FOR SUBMISSION.— 

(1) PART A.—Section 1814(a) of the Social Security Act 

(42 U.S.C. 1395f(a)(1)) is amended— 

(A) in paragraph (1), by striking ‘‘period of 3 calendar 

years’’ and all that follows through the semicolon and 

inserting ‘‘period ending 1 calendar year after the date 

of service;’’; and 

(B) by adding at the end the following new sentence: 

‘‘In applying paragraph (1), the Secretary may specify 

exceptions to the 1 calendar year period specified in such 

paragraph.’’ 

(2) PART B.— 
H. R. 3590—650 

(A) Section 1842(b)(3) of such Act (42 U.S.C. 

1395u(b)(3)(B)) is amended— 

(i) in subparagraph (B), in the flush language following clause (ii), by striking ‘‘close of the calendar 

year following the year in which such service is furnished (deeming any service furnished in the last 3 

months of any calendar year to have been furnished 

in the succeeding calendar year)’’ and inserting ‘‘period 

ending 1 calendar year after the date of service’’; and 

(ii) by adding at the end the following new sentence: ‘‘In applying subparagraph (B), the Secretary 

may specify exceptions to the 1 calendar year period 

specified in such subparagraph.’’ 

(B) Section 1835(a) of such Act (42 U.S.C. 1395n(a)) 

is amended— 

(i) in paragraph (1), by striking ‘‘period of 3 calendar years’’ and all that follows through the semicolon 

and inserting ‘‘period ending 1 calendar year after 

the date of service;’’; and 

(ii) by adding at the end the following new sentence: ‘‘In applying paragraph (1), the Secretary may 

specify exceptions to the 1 calendar year period specified in such paragraph.’’ 

(b) EFFECTIVE DATE.— 

(1) IN GENERAL.—The amendments made by subsection 

(a) shall apply to services furnished on or after January 1, 

2010. 

(2) SERVICES FURNISHED BEFORE 2010.—In the case of services furnished before January 1, 2010, a bill or request for 

payment under section 1814(a)(1), 1842(b)(3)(B), or 1835(a) 

shall be filed not later that December 31, 2010. 

SEC. 6405. PHYSICIANS WHO ORDER ITEMS OR SERVICES REQUIRED 

TO BE MEDICARE ENROLLED PHYSICIANS OR ELIGIBLE 

PROFESSIONALS. 

(a) DME.—Section 1834(a)(11)(B) of the Social Security Act 

(42 U.S.C. 1395m(a)(11)(B)) is amended by striking ‘‘physician’’ 

and inserting ‘‘physician enrolled under section 1866(j) or an eligible 

professional under section 1848(k)(3)(B) that is enrolled under section 1866(j)’’. 

(b) HOME HEALTH SERVICES.— 

(1) PART A.—Section 1814(a)(2) of such Act (42 U.S.C. 

1395(a)(2)) is amended in the matter preceding subparagraph 

(A) by inserting ‘‘in the case of services described in subparagraph (C), a physician enrolled under section 1866(j) or an 

eligible professional under section 1848(k)(3)(B),’’ before ‘‘or, 

in the case of services’’. 

(2) PART B.—Section 1835(a)(2) of such Act (42 U.S.C. 

1395n(a)(2)) is amended in the matter preceding subparagraph 

(A) by inserting ‘‘, or in the case of services described in 

subparagraph (A), a physician enrolled under section 1866(j) 

or an eligible professional under section 1848(k)(3)(B),’’ after 

‘‘a physician’’. 

(c) APPLICATION TO OTHER ITEMS OR SERVICES.—The Secretary 

may extend the requirement applied by the amendments made 

by subsections (a) and (b) to durable medical equipment and home 

health services (relating to requiring certifications and written 
H. R. 3590—651 

orders to be made by enrolled physicians and health professions) 

to all other categories of items or services under title XVIII of 

the Social Security Act (42 U.S.C. 1395 et seq.), including covered 

part D drugs as defined in section 1860D–2(e) of such Act (42 

U.S.C. 1395w–102), that are ordered, prescribed, or referred by 

a physician enrolled under section 1866(j) of such Act (42 U.S.C. 

1395cc(j)) or an eligible professional under section 1848(k)(3)(B) 

of such Act (42 U.S.C. 1395w–4(k)(3)(B)). 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to written orders and certifications made on or after 

July 1, 2010. 

SEC. 6406. REQUIREMENT FOR PHYSICIANS TO PROVIDE DOCUMENTATION ON REFERRALS TO PROGRAMS AT HIGH RISK OF 

WASTE AND ABUSE. 

(a) PHYSICIANS AND OTHER SUPPLIERS.—Section 1842(h) of the 

Social Security Act (42 U.S.C. 1395u(h)) is amended by adding 

at the end the following new paragraph: 

‘‘(9) The Secretary may revoke enrollment, for a period of not 

more than one year for each act, for a physician or supplier under 

section 1866(j) if such physician or supplier fails to maintain and, 

upon request of the Secretary, provide access to documentation 

relating to written orders or requests for payment for durable 

medical equipment, certifications for home health services, or referrals for other items or services written or ordered by such physician 

or supplier under this title, as specified by the Secretary.’’. 

(b) PROVIDERS OF SERVICES.—Section 1866(a)(1) of such Act 

(42 U.S.C. 1395cc) is further amended— 

(1) in subparagraph (U), by striking at the end ‘‘and’’; 

(2) in subparagraph (V), by striking the period at the 

end and adding ‘‘; and’’; and 

(3) by adding at the end the following new subparagraph: 

‘‘(W) maintain and, upon request of the Secretary, provide access to documentation relating to written orders 

or requests for payment for durable medical equipment, 

certifications for home health services, or referrals for other 

items or services written or ordered by the provider under 

this title, as specified by the Secretary.’’. 

(c) OIG PERMISSIVE EXCLUSION AUTHORITY.—Section 

1128(b)(11) of the Social Security Act (42 U.S.C. 1320a–7(b)(11)) 

is amended by inserting ‘‘, ordering, referring for furnishing, or 

certifying the need for’’ after ‘‘furnishing’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to orders, certifications, and referrals made on or after 

January 1, 2010. 

SEC. 6407. FACE TO FACE ENCOUNTER WITH PATIENT REQUIRED 

BEFORE PHYSICIANS MAY CERTIFY ELIGIBILITY FOR 

HOME HEALTH SERVICES OR DURABLE MEDICAL EQUIPMENT UNDER MEDICARE. 

(a) CONDITION OF PAYMENT FOR HOME HEALTH SERVICES.— (1) PART A.—Section 1814(a)(2)(C) of such Act is amended— 

(A) by striking ‘‘and such services’’ and inserting ‘‘such 

services’’; and 

(B) by inserting after ‘‘care of a physician’’ the following: ‘‘, and, in the case of a certification made by a 

physician after January 1, 2010, prior to making such 
H. R. 3590—652 

certification the physician must document that the physician himself or herself has had a face-to-face encounter 

(including through use of telehealth, subject to the requirements in section 1834(m), and other than with respect 

to encounters that are incident to services involved) with 

the individual within a reasonable timeframe as determined by the Secretary’’. 

(2) PART B.—Section 1835(a)(2)(A) of the Social Security 

Act is amended— 

(A) by striking ‘‘and’’ before ‘‘(iii)’’; and 

(B) by inserting after ‘‘care of a physician’’ the following: ‘‘, and (iv) in the case of a certification after January 

1, 2010, prior to making such certification the physician 

must document that the physician has had a face-to-face 

encounter (including through use of telehealth and other 

than with respect to encounters that are incident to services 

involved) with the individual during the 6-month period 

preceding such certification, or other reasonable timeframe 

as determined by the Secretary’’. 

(b) CONDITION OF PAYMENT FOR DURABLE MEDICAL EQUIPMENT.—Section 1834(a)(11)(B) of the Social Security Act (42 U.S.C. 

1395m(a)(11)(B)) is amended— 

(1) by striking ‘‘ORDER.—The Secretary’’ and inserting 

‘‘ORDER.— 

‘‘(i) IN GENERAL.—The Secretary’’; and 

(2) by adding at the end the following new clause: 

‘‘(ii) REQUIREMENT FOR FACE TO FACE

ENCOUNTER.—The Secretary shall require that such 

an order be written pursuant to the physician documenting that a physician, a physician assistant, a 

nurse practitioner, or a clinical nurse specialist (as 

those terms are defined in section 1861(aa)(5)) has 

had a face-to-face encounter (including through use 

of telehealth under subsection (m) and other than with 

respect to encounters that are incident to services 

involved) with the individual involved during the 6- 

month period preceding such written order, or other 

reasonable timeframe as determined by the Secretary.’’. 

(c) APPLICATION TO OTHER AREAS UNDER MEDICARE.—The Secretary may apply the face-to-face encounter requirement described 

in the amendments made by subsections (a) and (b) to other items 

and services for which payment is provided under title XVIII of 

the Social Security Act based upon a finding that such an decision 

would reduce the risk of waste, fraud, or abuse. 

(d) APPLICATION TO MEDICAID.—The requirements pursuant to 

the amendments made by subsections (a) and (b) shall apply in 

the case of physicians making certifications for home health services 

under title XIX of the Social Security Act in the same manner 

and to the same extent as such requirements apply in the case 

of physicians making such certifications under title XVIII of such 

Act. 

SEC. 6408. ENHANCED PENALTIES. 

(a) CIVIL MONETARY PENALTIES FOR FALSE STATEMENTS OR

DELAYING INSPECTIONS.—Section 1128A(a) of the Social Security 

Act (42 U.S.C. 1320a–7a(a)), as amended by section 5002(d)(2)(A), 

is amended— 
H. R. 3590—653 

(1) in paragraph (6), by striking ‘‘or’’ at the end; and 

(2) by inserting after paragraph (7) the following new paragraphs: 

‘‘(8) knowingly makes, uses, or causes to be made or used, 

a false record or statement material to a false or fraudulent 

claim for payment for items and services furnished under a 

Federal health care program; or 

‘‘(9) fails to grant timely access, upon reasonable request 

(as defined by the Secretary in regulations), to the Inspector 

General of the Department of Health and Human Services, 

for the purpose of audits, investigations, evaluations, or other 

statutory functions of the Inspector General of the Department 

of Health and Human Services;’’; and 

(3) in the first sentence— 

(A) by striking ‘‘or in cases under paragraph (7)’’ and 

inserting ‘‘in cases under paragraph (7)’’; and 

(B) by striking ‘‘act)’’ and inserting ‘‘act, in cases under 

paragraph (8), $50,000 for each false record or statement, 

or in cases under paragraph (9), $15,000 for each day 

of the failure described in such paragraph)’’. 

(b) MEDICARE ADVANTAGE AND PART D PLANS.— 

(1) ENSURING TIMELY INSPECTIONS RELATING TO CONTRACTS

WITH MA ORGANIZATIONS.—Section 1857(d)(2) of such Act (42 

U.S.C. 1395w–27(d)(2)) is amended— 

(A) in subparagraph (A), by inserting ‘‘timely’’ before 

‘‘inspect’’; and 

(B) in subparagraph (B), by inserting ‘‘timely’’ before 

‘‘audit and inspect’’. 

(2) MARKETING VIOLATIONS.—Section 1857(g)(1) of the 

Social Security Act (42 U.S.C. 1395w–27(g)(1)) is amended— 

(A) in subparagraph (F), by striking ‘‘or’’ at the end; 

(B) by inserting after subparagraph (G) the following 

new subparagraphs: 

‘‘(H) except as provided under subparagraph (C) or 

(D) of section 1860D–1(b)(1), enrolls an individual in any 

plan under this part without the prior consent of the individual or the designee of the individual; 

‘‘(I) transfers an individual enrolled under this part 

from one plan to another without the prior consent of 

the individual or the designee of the individual or solely 

for the purpose of earning a commission; 

‘‘(J) fails to comply with marketing restrictions 

described in subsections (h) and (j) of section 1851 or 

applicable implementing regulations or guidance; or 

‘‘(K) employs or contracts with any individual or entity 

who engages in the conduct described in subparagraphs 

(A) through (J) of this paragraph;’’; and 

(C) by adding at the end the following new sentence: 

‘‘The Secretary may provide, in addition to any other remedies authorized by law, for any of the remedies described 

in paragraph (2), if the Secretary determines that any 

employee or agent of such organization, or any provider 

or supplier who contracts with such organization, has 

engaged in any conduct described in subparagraphs (A) 

through (K) of this paragraph.’’. 

(3) PROVISION OF FALSE INFORMATION.—Section 

1857(g)(2)(A) of the Social Security Act (42 U.S.C. 1395w– 
H. R. 3590—654 

27(g)(2)(A)) is amended by inserting ‘‘except with respect to 

a determination under subparagraph (E), an assessment of 

not more than the amount claimed by such plan or plan sponsor 

based upon the misrepresentation or falsified information 

involved,’’ after ‘‘for each such determination,’’. 

(c) OBSTRUCTION OF PROGRAM AUDITS.—Section 1128(b)(2) of 

the Social Security Act (42 U.S.C. 1320a–7(b)(2)) is amended— 

(1) in the heading, by inserting ‘‘OR AUDIT’’ after ‘‘INVESTIGATION’’; and 

(2) by striking ‘‘investigation into’’ and all that follows 

through the period and inserting ‘‘investigation or audit related 

to—’’ 

‘‘(i) any offense described in paragraph (1) or in 

subsection (a); or 

‘‘(ii) the use of funds received, directly or indirectly, 

from any Federal health care program (as defined in 

section 1128B(f)).’’. 

(d) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as provided in paragraph (2), the 

amendments made by this section shall apply to acts committed 

on or after January 1, 2010. 

(2) EXCEPTION.—The amendments made by subsection 

(b)(1) take effect on the date of enactment of this Act. 

SEC. 6409. MEDICARE SELF-REFERRAL DISCLOSURE PROTOCOL. 

(a) DEVELOPMENT OF SELF-REFERRAL DISCLOSURE PROTOCOL.— 

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

Services, in cooperation with the Inspector General of the 

Department of Health and Human Services, shall establish, 

not later than 6 months after the date of the enactment of 

this Act, a protocol to enable health care providers of services 

and suppliers to disclose an actual or potential violation of 

section 1877 of the Social Security Act (42 U.S.C. 1395nn) 

pursuant to a self-referral disclosure protocol (in this section 

referred to as an ‘‘SRDP’’). The SRDP shall include direction 

to health care providers of services and suppliers on— 

(A) a specific person, official, or office to whom such 

disclosures shall be made; and 

(B) instruction on the implication of the SRDP on 

corporate integrity agreements and corporate compliance 

agreements. 

(2) PUBLICATION ON INTERNET WEBSITE OF SRDP INFORMATION.—The Secretary of Health and Human Services shall post 

information on the public Internet website of the Centers for 

Medicare & Medicaid Services to inform relevant stakeholders 

of how to disclose actual or potential violations pursuant to 

an SRDP. 

(3) RELATION TO ADVISORY OPINIONS.—The SRDP shall be 

separate from the advisory opinion process set forth in regulations implementing section 1877(g) of the Social Security Act. 

(b) REDUCTION IN AMOUNTS OWED.—The Secretary of Health 

and Human Services is authorized to reduce the amount due and 

owing for all violations under section 1877 of the Social Security 

Act to an amount less than that specified in subsection (g) of 

such section. In establishing such amount for a violation, the Secretary may consider the following factors: 
H. R. 3590—655 

(1) The nature and extent of the improper or illegal practice. 

(2) The timeliness of such self-disclosure. 

(3) The cooperation in providing additional information 

related to the disclosure. 

(4) Such other factors as the Secretary considers appropriate. 

(c) REPORT.—Not later than 18 months after the date on which 

the SRDP protocol is established under subsection (a)(1), the Secretary shall submit to Congress a report on the implementation 

of this section. Such report shall include— 

(1) the number of health care providers of services and 

suppliers making disclosures pursuant to the SRDP; 

(2) the amounts collected pursuant to the SRDP; 

(3) the types of violations reported under the SRDP; and 

(4) such other information as may be necessary to evaluate 

the impact of this section. 

SEC. 6410. ADJUSTMENTS TO THE MEDICARE DURABLE MEDICAL 

EQUIPMENT, PROSTHETICS, ORTHOTICS, AND SUPPLIES 

COMPETITIVE ACQUISITION PROGRAM. 

(a) EXPANSION OF ROUND 2 OF THE DME COMPETITIVE BIDDING

PROGRAM.—Section 1847(a)(1) of the Social Security Act (42 U.S.C. 

1395w–3(a)(1)) is amended— 

(1) in subparagraph (B)(i)(II), by striking ‘‘70’’ and inserting 

‘‘91’’; and 

(2) in subparagraph (D)(ii)— 

(A) in subclause (I), by striking ‘‘and’’ at the end; 

(B) by redesignating subclause (II) as subclause (III); 

and 

(C) by inserting after subclause (I) the following new 

subclause: 

‘‘(II) the Secretary shall include the next 21 

largest metropolitan statistical areas by total population (after those selected under subclause (I)) 

for such round; and’’. 

(b) REQUIREMENT TO EITHER COMPETITIVELY BID AREAS OR

USE COMPETITIVE BID PRICES BY 2016.—Section 1834(a)(1)(F) of 

the Social Security Act (42 U.S.C. 1395m(a)(1)(F)) is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) in clause (ii)— 

(A) by inserting ‘‘(and, in the case of covered items 

furnished on or after January 1, 2016, subject to clause 

(iii), shall)’’ after ‘‘may’’; and 

(B) by striking the period at the end and inserting 

‘‘; and’’; and 

(3) by adding at the end the following new clause: 

‘‘(iii) in the case of covered items furnished on 

or after January 1, 2016, the Secretary shall continue 

to make such adjustments described in clause (ii) as, 

under such competitive acquisition programs, additional covered items are phased in or information is 

updated as contracts under section 1847 are recompeted in accordance with section 1847(b)(3)(B).’’. 

SEC. 6411. EXPANSION OF THE RECOVERY AUDIT CONTRACTOR (RAC) 

PROGRAM. 

(a) EXPANSION TO MEDICAID.— 
H. R. 3590—656 

(1) STATE PLAN AMENDMENT.—Section 1902(a)(42) of the 

Social Security Act (42 U.S.C. 1396a(a)(42)) is amended— 

(A) by striking ‘‘that the records’’ and inserting ‘‘that— 

‘‘(A) the records’’; 

(B) by inserting ‘‘and’’ after the semicolon; and 

(C) by adding at the end the following: 

‘‘(B) not later than December 31, 2010, the State 

shall— 

‘‘(i) establish a program under which the State 

contracts (consistent with State law and in the same 

manner as the Secretary enters into contracts with 

recovery audit contractors under section 1893(h), subject to such exceptions or requirements as the Secretary 

may require for purposes of this title or a particular 

State) with 1 or more recovery audit contractors for 

the purpose of identifying underpayments and overpayments and recouping overpayments under the State 

plan and under any waiver of the State plan with 

respect to all services for which payment is made to 

any entity under such plan or waiver; and 

‘‘(ii) provide assurances satisfactory to the Secretary that— 

‘‘(I) under such contracts, payment shall be 

made to such a contractor only from amounts 

recovered; 

‘‘(II) from such amounts recovered, payment— 

‘‘(aa) shall be made on a contingent basis 

for collecting overpayments; and 

‘‘(bb) may be made in such amounts as 

the State may specify for identifying underpayments; 

‘‘(III) the State has an adequate process for 

entities to appeal any adverse determination made 

by such contractors; and 

‘‘(IV) such program is carried out in accordance 

with such requirements as the Secretary shall 

specify, including— 

‘‘(aa) for purposes of section 1903(a)(7), 

that amounts expended by the State to carry 

out the program shall be considered amounts 

expended as necessary for the proper and efficient administration of the State plan or a 

waiver of the plan; 

‘‘(bb) that section 1903(d) shall apply to 

amounts recovered under the program; and 

‘‘(cc) that the State and any such contractors under contract with the State shall coordinate such recovery audit efforts with other 

contractors or entities performing audits of 

entities receiving payments under the State 

plan or waiver in the State, including efforts 

with Federal and State law enforcement with 

respect to the Department of Justice, including 

the Federal Bureau of Investigations, the 

Inspector General of the Department of Health 

and Human Services, and the State medicaid 

fraud control unit; and’’. 
H. R. 3590—657 

(2) COORDINATION; REGULATIONS.— 

(A) IN GENERAL.—The Secretary of Health and Human 

Services, acting through the Administrator of the Centers 

for Medicare & Medicaid Services, shall coordinate the 

expansion of the Recovery Audit Contractor program to 

Medicaid with States, particularly with respect to each 

State that enters into a contract with a recovery audit 

contractor for purposes of the State’s Medicaid program 

prior to December 31, 2010. 

(B) REGULATIONS.—The Secretary of Health and 

Human Services shall promulgate regulations to carry out 

this subsection and the amendments made by this subsection, including with respect to conditions of Federal 

financial participation, as specified by the Secretary. 

(b) EXPANSION TO MEDICARE PARTS C AND D.—Section 1893(h) 

of the Social Security Act (42 U.S.C. 1395ddd(h)) is amended— 

(1) in paragraph (1), in the matter preceding subparagraph 

(A), by striking ‘‘part A or B’’ and inserting ‘‘this title’’; 

(2) in paragraph (2), by striking ‘‘parts A and B’’ and 

inserting ‘‘this title’’; 

(3) in paragraph (3), by inserting ‘‘(not later than December 

31, 2010, in the case of contracts relating to payments made 

under part C or D)’’ after ‘‘2010’’; 

(4) in paragraph (4), in the matter preceding subparagraph 

(A), by striking ‘‘part A or B’’ and inserting ‘‘this title’’; and 

(5) by adding at the end the following: 

‘‘(9) SPECIAL RULES RELATING TO PARTS C AND D.—The 

Secretary shall enter into contracts under paragraph (1) to 

require recovery audit contractors to— 

‘‘(A) ensure that each MA plan under part C has an 

anti-fraud plan in effect and to review the effectiveness 

of each such anti-fraud plan; 

‘‘(B) ensure that each prescription drug plan under 

part D has an anti-fraud plan in effect and to review 

the effectiveness of each such anti-fraud plan; 

‘‘(C) examine claims for reinsurance payments under 

section 1860D–15(b) to determine whether prescription 

drug plans submitting such claims incurred costs in excess 

of the allowable reinsurance costs permitted under paragraph (2) of that section; and 

‘‘(D) review estimates submitted by prescription drug 

plans by private plans with respect to the enrollment of 

high cost beneficiaries (as defined by the Secretary) and 

to compare such estimates with the numbers of such beneficiaries actually enrolled by such plans.’’. 

(c) ANNUAL REPORT.—The Secretary of Health and Human 

Services, acting through the Administrator of the Centers for Medicare & Medicaid Services, shall submit an annual report to Congress 

concerning the effectiveness of the Recovery Audit Contractor program under Medicaid and Medicare and shall include such reports 

recommendations for expanding or improving the program. 
H. R. 3590—658 

Subtitle F—Additional Medicaid Program 

Integrity Provisions 

SEC. 6501. TERMINATION OF PROVIDER PARTICIPATION UNDER MEDICAID IF TERMINATED UNDER MEDICARE OR OTHER 

STATE PLAN. 

Section 1902(a)(39) of the Social Security Act (42 U.S.C. 42 

U.S.C. 1396a(a)) is amended by inserting after ‘‘1128A,’’ the following: ‘‘terminate the participation of any individual or entity 

in such program if (subject to such exceptions as are permitted 

with respect to exclusion under sections 1128(c)(3)(B) and 

1128(d)(3)(B)) participation of such individual or entity is terminated under title XVIII or any other State plan under this title,’’. 

SEC. 6502. MEDICAID EXCLUSION FROM PARTICIPATION RELATING TO 

CERTAIN OWNERSHIP, CONTROL, AND MANAGEMENT 

AFFILIATIONS. 

Section 1902(a) of the Social Security Act (42 U.S.C. 1396a(a)), 

as amended by section 6401(b), is amended by inserting after paragraph (77) the following: 

‘‘(78) provide that the State agency described in paragraph 

(9) exclude, with respect to a period, any individual or entity 

from participation in the program under the State plan if 

such individual or entity owns, controls, or manages an entity 

that (or if such entity is owned, controlled, or managed by 

an individual or entity that)— 

‘‘(A) has unpaid overpayments (as defined by the Secretary) under this title during such period determined by 

the Secretary or the State agency to be delinquent; 

‘‘(B) is suspended or excluded from participation under 

or whose participation is terminated under this title during 

such period; or 

‘‘(C) is affiliated with an individual or entity that has 

been suspended or excluded from participation under this 

title or whose participation is terminated under this title 

during such period;’’. 

SEC. 6503. BILLING AGENTS, CLEARINGHOUSES, OR OTHER ALTERNATE PAYEES REQUIRED TO REGISTER UNDER MEDICAID. 

(a) IN GENERAL.—Section 1902(a) of the Social Security Act 

(42 U.S.C. 42 U.S.C. 1396a(a)), as amended by section 6502(a), 

is amended by inserting after paragraph (78), the following: 

‘‘(79) provide that any agent, clearinghouse, or other alternate payee (as defined by the Secretary) that submits claims 

on behalf of a health care provider must register with the 

State and the Secretary in a form and manner specified by 

the Secretary;’’. 

SEC. 6504. REQUIREMENT TO REPORT EXPANDED SET OF DATA ELEMENTS UNDER MMIS TO DETECT FRAUD AND ABUSE. 

(a) IN GENERAL.—Section 1903(r)(1)(F) of the Social Security 

Act (42 U.S.C. 1396b(r)(1)(F)) is amended by inserting after ‘‘necessary’’ the following: ‘‘and including, for data submitted to the 

Secretary on or after January 1, 2010, data elements from the 
H. R. 3590—659 

automated data system that the Secretary determines to be necessary for program integrity, program oversight, and administration, at such frequency as the Secretary shall determine’’. 

(b) MANAGED CARE ORGANIZATIONS.— 

(1) IN GENERAL.—Section 1903(m)(2)(A)(xi) of the Social 

Security Act (42 U.S.C. 1396b(m)(2)(A)(xi)) is amended by 

inserting ‘‘and for the provision of such data to the State 

at a frequency and level of detail to be specified by the Secretary’’ after ‘‘patients’’. 

(2) EFFECTIVE DATE.—The amendment made by paragraph 

(1) shall apply with respect to contract years beginning on 

or after January 1, 2010. 

SEC. 6505. PROHIBITION ON PAYMENTS TO INSTITUTIONS OR ENTITIES 

LOCATED OUTSIDE OF THE UNITED STATES. 

Section 1902(a) of the Social Security Act (42 U.S.C. 1396b(a)), 

as amended by section 6503, is amended by inserting after paragraph (79) the following new paragraph: 

‘‘(80) provide that the State shall not provide any payments 

for items or services provided under the State plan or under 

a waiver to any financial institution or entity located outside 

of the United States;’’. 

SEC. 6506. OVERPAYMENTS. 

(a) EXTENSION OF PERIOD FOR COLLECTION OF OVERPAYMENTS

DUE TO FRAUD.— 

(1) IN GENERAL.—Section 1903(d)(2) of the Social Security 

Act (42 U.S.C. 1396b(d)(2)) is amended— 

(A) in subparagraph (C)— 

(i) in the first sentence, by striking ‘‘60 days’’ and 

inserting ‘‘1 year’’; and 

(ii) in the second sentence, by striking ‘‘60 days’’ 

and inserting ‘‘1-year period’’; and 

(B) in subparagraph (D)— 

(i) in inserting ‘‘(i)’’ after ‘‘(D)’’; and 

(ii) by adding at the end the following: 

‘‘(ii) In any case where the State is unable to recover a debt 

which represents an overpayment (or any portion thereof) made 

to a person or other entity due to fraud within 1 year of discovery 

because there is not a final determination of the amount of the 

overpayment under an administrative or judicial process (as 

applicable), including as a result of a judgment being under appeal, 

no adjustment shall be made in the Federal payment to such 

State on account of such overpayment (or portion thereof) before 

the date that is 30 days after the date on which a final judgment 

(including, if applicable, a final determination on an appeal) is 

made.’’. 

(2) EFFECTIVE DATE.—The amendments made by this subsection take effect on the date of enactment of this Act and 

apply to overpayments discovered on or after that date. 

(b) CORRECTIVE ACTION.—The Secretary shall promulgate regulations that require States to correct Federally identified claims 

overpayments, of an ongoing or recurring nature, with new Medicaid 

Management Information System (MMIS) edits, audits, or other 

appropriate corrective action. 
H. R. 3590—660 

SEC. 6507. MANDATORY STATE USE OF NATIONAL CORRECT CODING 

INITIATIVE. 

Section 1903(r) of the Social Security Act (42 U.S.C. 1396b(r)) 

is amended— 

(1) in paragraph (1)(B)— 

(A) in clause (ii), by striking ‘‘and’’ at the end; 

(B) in clause (iii), by adding ‘‘and’’ after the semicolon; and 

(C) by adding at the end the following new clause: 

‘‘(iv) effective for claims filed on or after October 

1, 2010, incorporate compatible methodologies of the 

National Correct Coding Initiative administered by the 

Secretary (or any successor initiative to promote correct 

coding and to control improper coding leading to 

inappropriate payment) and such other methodologies 

of that Initiative (or such other national correct coding 

methodologies) as the Secretary identifies in accordance with paragraph (4);’’; and 

(2) by adding at the end the following new paragraph: 

‘‘(4) For purposes of paragraph (1)(B)(iv), the Secretary shall 

do the following: 

‘‘(A) Not later than September 1, 2010: 

‘‘(i) Identify those methodologies of the National Correct Coding Initiative administered by the Secretary (or 

any successor initiative to promote correct coding and to 

control improper coding leading to inappropriate payment) 

which are compatible to claims filed under this title. 

‘‘(ii) Identify those methodologies of such Initiative (or 

such other national correct coding methodologies) that 

should be incorporated into claims filed under this title 

with respect to items or services for which States provide 

medical assistance under this title and no national correct 

coding methodologies have been established under such 

Initiative with respect to title XVIII. 

‘‘(iii) Notify States of— 

‘‘(I) the methodologies identified under subparagraphs (A) and (B) (and of any other national correct 

coding methodologies identified under subparagraph 

(B)); and 

‘‘(II) how States are to incorporate such methodologies into claims filed under this title. 

‘‘(B) Not later than March 1, 2011, submit a report to 

Congress that includes the notice to States under clause (iii) 

of subparagraph (A) and an analysis supporting the identification of the methodologies made under clauses (i) and (ii) of 

subparagraph (A).’’. 

SEC. 6508. GENERAL EFFECTIVE DATE. 

(a) IN GENERAL.—Except as otherwise provided in this subtitle, 

this subtitle and the amendments made by this subtitle take effect 

on January 1, 2011, without regard to whether final regulations 

to carry out such amendments and subtitle have been promulgated 

by that date. 

(b) DELAY IF STATE LEGISLATION REQUIRED.—In the case of 

a State plan for medical assistance under title XIX of the Social 

Security Act or a child health plan under title XXI of such Act 

which the Secretary of Health and Human Services determines 
H. R. 3590—661 

requires State legislation (other than legislation appropriating 

funds) in order for the plan to meet the additional requirement 

imposed by the amendments made by this subtitle, the State plan 

or child health plan shall not be regarded as failing to comply 

with the requirements of such title solely on the basis of its failure 

to meet this additional requirement before the first day of the 

first calendar quarter beginning after the close of the first regular 

session of the State legislature that begins after the date of the 

enactment of this Act. For purposes of the previous sentence, in 

the case of a State that has a 2-year legislative session, each 

year of such session shall be deemed to be a separate regular 

session of the State legislature. 

Subtitle G—Additional Program Integrity 

Provisions 

SEC. 6601. PROHIBITION ON FALSE STATEMENTS AND REPRESENTATIONS. 

(a) PROHIBITION.—Part 5 of subtitle B of title I of the Employee 

Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.) 

is amended by adding at the end the following: 

‘‘SEC. 519. PROHIBITION ON FALSE STATEMENTS AND REPRESENTATIONS. 

‘‘No person, in connection with a plan or other arrangement 

that is multiple employer welfare arrangement described in section 

3(40), shall make a false statement or false representation of fact, 

knowing it to be false, in connection with the marketing or sale 

of such plan or arrangement, to any employee, any member of 

an employee organization, any beneficiary, any employer, any 

employee organization, the Secretary, or any State, or the representative or agent of any such person, State, or the Secretary, concerning— 

‘‘(1) the financial condition or solvency of such plan or 

arrangement; 

‘‘(2) the benefits provided by such plan or arrangement; 

‘‘(3) the regulatory status of such plan or other arrangement 

under any Federal or State law governing collective bargaining, 

labor management relations, or intern union affairs; or 

‘‘(4) the regulatory status of such plan or other arrangement 

regarding exemption from state regulatory authority under this 

Act. 

This section shall not apply to any plan or arrangement that does 

not fall within the meaning of the term ‘multiple employer welfare 

arrangement’ under section 3(40)(A).’’. 

(b) CRIMINAL PENALTIES.—Section 501 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1131) is amended— 

(1) by inserting ‘‘(a)’’ before ‘‘Any person’’; and 

(2) by adding at the end the following: 

‘‘(b) Any person that violates section 519 shall upon conviction 

be imprisoned not more than 10 years or fined under title 18, 

United States Code, or both.’’. 

(c) CONFORMING AMENDMENT.—The table of sections for part 

5 of subtitle B of title I of the Employee Retirement Income Security 

Act of 1974 is amended by adding at the end the following: 

‘‘Sec. 519. Prohibition on false statement and representations.’’. 
H. R. 3590—662 

SEC. 6602. CLARIFYING DEFINITION. 

Section 24(a)(2) of title 18, United States Code, is amended 

by inserting ‘‘or section 411, 518, or 511 of the Employee Retirement 

Income Security Act of 1974,’’ after ‘‘1954 of this title’’. 

SEC. 6603. DEVELOPMENT OF MODEL UNIFORM REPORT FORM. 

Part C of title XXVII of the Public Health Service Act (42 

U.S.C. 300gg–91 et seq.) is amended by adding at the end the 

following: 

‘‘SEC. 2794. UNIFORM FRAUD AND ABUSE REFERRAL FORMAT. 

‘‘The Secretary shall request the National Association of Insurance Commissioners to develop a model uniform report form for 

private health insurance issuer seeking to refer suspected fraud 

and abuse to State insurance departments or other responsible 

State agencies for investigation. The Secretary shall request that 

the National Association of Insurance Commissioners develop recommendations for uniform reporting standards for such referrals.’’. 

SEC. 6604. APPLICABILITY OF STATE LAW TO COMBAT FRAUD AND 

ABUSE. 

(a) IN GENERAL.—Part 5 of subtitle B of title I of the Employee 

Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.), 

as amended by section 6601, is further amended by adding at 

the end the following: 

‘‘SEC. 520. APPLICABILITY OF STATE LAW TO COMBAT FRAUD AND 

ABUSE. 

‘‘The Secretary may, for the purpose of identifying, preventing, 

or prosecuting fraud and abuse, adopt regulatory standards establishing, or issue an order relating to a specific person establishing, 

that a person engaged in the business of providing insurance 

through a multiple employer welfare arrangement described in 

section 3(40) is subject to the laws of the States in which such 

person operates which regulate insurance in such State, notwithstanding section 514(b)(6) of this Act or the Liability Risk Retention 

Act of 1986, and regardless of whether the law of the State is 

otherwise preempted under any of such provisions. This section 

shall not apply to any plan or arrangement that does not fall 

within the meaning of the term ‘multiple employer welfare arrangement’ under section 3(40)(A).’’. 

(b) CONFORMING AMENDMENT.—The table of sections for part 

5 of subtitle B of title I of the Employee Retirement Income Security 

Act of 1974, as amended by section 6601, is further amended 

by adding at the end the following: 

‘‘Sec. 520. Applicability of State law to combat fraud and abuse.’’. 

SEC. 6605. ENABLING THE DEPARTMENT OF LABOR TO ISSUE ADMINISTRATIVE SUMMARY CEASE AND DESIST ORDERS AND 

SUMMARY SEIZURES ORDERS AGAINST PLANS THAT ARE 

IN FINANCIALLY HAZARDOUS CONDITION. 

(a) IN GENERAL.—Part 5 of subtitle B of title I of the Employee 

Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.), 

as amended by section 6604, is further amended by adding at 

the end the following: 
H. R. 3590—663 

‘‘SEC. 521. ADMINISTRATIVE SUMMARY CEASE AND DESIST ORDERS 

AND SUMMARY SEIZURE ORDERS AGAINST MULTIPLE 

EMPLOYER WELFARE ARRANGEMENTS IN FINANCIALLY 

HAZARDOUS CONDITION. 

‘‘(a) IN GENERAL.—The Secretary may issue a cease and desist 

(ex parte) order under this title if it appears to the Secretary 

that the alleged conduct of a multiple employer welfare arrangement 

described in section 3(40), other than a plan or arrangement 

described in subsection (g), is fraudulent, or creates an immediate 

danger to the public safety or welfare, or is causing or can be 

reasonably expected to cause significant, imminent, and irreparable 

public injury. 

‘‘(b) HEARING.—A person that is adversely affected by the 

issuance of a cease and desist order under subsection (a) may 

request a hearing by the Secretary regarding such order. The Secretary may require that a proceeding under this section, including 

all related information and evidence, be conducted in a confidential 

manner. 

‘‘(c) BURDEN OF PROOF.—The burden of proof in any hearing 

conducted under subsection (b) shall be on the party requesting 

the hearing to show cause why the cease and desist order should 

be set aside. 

‘‘(d) DETERMINATION.—Based upon the evidence presented at 

a hearing under subsection (b), the cease and desist order involved 

may be affirmed, modified, or set aside by the Secretary in whole 

or in part. 

‘‘(e) SEIZURE.—The Secretary may issue a summary seizure 

order under this title if it appears that a multiple employer welfare 

arrangement is in a financially hazardous condition. 

‘‘(f) REGULATIONS.—The Secretary may promulgate such regulations or other guidance as may be necessary or appropriate to 

carry out this section. 

‘‘(g) EXCEPTION.—This section shall not apply to any plan or 

arrangement that does not fall within the meaning of the term 

‘multiple employer welfare arrangement’ under section 3(40)(A).’’. 

(b) CONFORMING AMENDMENT.—The table of sections for part 

5 of subtitle B of title I of the Employee Retirement Income Security 

Act of 1974, as amended by section 6604, is further amended 

by adding at the end the following: 

‘‘Sec. 521. Administrative summary cease and desist orders and summary seizure 

orders against health plans in financially hazardous condition.’’. 

SEC. 6606. MEWA PLAN REGISTRATION WITH DEPARTMENT OF LABOR. 

Section 101(g) of the Employee Retirement Income Security 

Act of 1974 (29 U.S.C. 1021(g)) is amended— 

(1) by striking ‘‘Secretary may’’ and inserting ‘‘Secretary 

shall’’; and 

(2) by inserting ‘‘to register with the Secretary prior to 

operating in a State and may, by regulation, require such 

multiple employer welfare arrangements’’ after ‘‘not group 

health plans’’. 

SEC. 6607. PERMITTING EVIDENTIARY PRIVILEGE AND CONFIDENTIAL 

COMMUNICATIONS. 

Section 504 of the Employee Retirement Income Security Act 

of 1974 (29 U.S.C. 1134) is amended by adding at the end the 

following: 
H. R. 3590—664 

‘‘(d) The Secretary may promulgate a regulation that provides 

an evidentiary privilege for, and provides for the confidentiality 

of communications between or among, any of the following entities 

or their agents, consultants, or employees: 

‘‘(1) A State insurance department. 

‘‘(2) A State attorney general. 

‘‘(3) The National Association of Insurance Commissioners. 

‘‘(4) The Department of Labor. 

‘‘(5) The Department of the Treasury. 

‘‘(6) The Department of Justice. 

‘‘(7) The Department of Health and Human Services. 

‘‘(8) Any other Federal or State authority that the Secretary 

determines is appropriate for the purposes of enforcing the 

provisions of this title. 

‘‘(e) The privilege established under subsection (d) shall apply 

to communications related to any investigation, audit, examination, 

or inquiry conducted or coordinated by any of the agencies. A 

communication that is privileged under subsection (d) shall not 

waive any privilege otherwise available to the communicating 

agency or to any person who provided the information that is 

communicated.’’. 

Subtitle H—Elder Justice Act 

SEC. 6701. SHORT TITLE OF SUBTITLE. 

This subtitle may be cited as the ‘‘Elder Justice Act of 2009’’. 

SEC. 6702. DEFINITIONS. 

Except as otherwise specifically provided, any term that is 

defined in section 2011 of the Social Security Act (as added by 

section 6703(a)) and is used in this subtitle has the meaning given 

such term by such section. 

SEC. 6703. ELDER JUSTICE. 

(a) ELDER JUSTICE.— 

(1) IN GENERAL.—Title XX of the Social Security Act (42 

U.S.C. 1397 et seq.) is amended— 

(A) in the heading, by inserting ‘‘AND ELDER JUSTICE’’ after ‘‘SOCIAL SERVICES’’; 

(B) by inserting before section 2001 the following: 

‘‘Subtitle A—Block Grants to States for 

Social Services’’; 

and 

(C) by adding at the end the following: 

‘‘Subtitle B—Elder Justice 

‘‘SEC. 2011. DEFINITIONS. 

‘‘In this subtitle: 

‘‘(1) ABUSE.—The term ‘abuse’ means the knowing infliction 

of physical or psychological harm or the knowing deprivation 

of goods or services that are necessary to meet essential needs 

or to avoid physical or psychological harm. 
H. R. 3590—665 

‘‘(2) ADULT PROTECTIVE SERVICES.—The term ‘adult protective services’ means such services provided to adults as the 

Secretary may specify and includes services such as— 

‘‘(A) receiving reports of adult abuse, neglect, or exploitation; 

‘‘(B) investigating the reports described in subparagraph (A); 

‘‘(C) case planning, monitoring, evaluation, and other 

case work and services; and 

‘‘(D) providing, arranging for, or facilitating the provision of medical, social service, economic, legal, housing, 

law enforcement, or other protective, emergency, or support 

services. 

‘‘(3) CAREGIVER.—The term ‘caregiver’ means an individual 

who has the responsibility for the care of an elder, either 

voluntarily, by contract, by receipt of payment for care, or 

as a result of the operation of law, and means a family member 

or other individual who provides (on behalf of such individual 

or of a public or private agency, organization, or institution) 

compensated or uncompensated care to an elder who needs 

supportive services in any setting. 

‘‘(4) DIRECT CARE.—The term ‘direct care’ means care by 

an employee or contractor who provides assistance or longterm care services to a recipient. 

‘‘(5) ELDER.—The term ‘elder’ means an individual age 

60 or older. 

‘‘(6) ELDER JUSTICE.—The term ‘elder justice’ means— 

‘‘(A) from a societal perspective, efforts to— 

‘‘(i) prevent, detect, treat, intervene in, and prosecute elder abuse, neglect, and exploitation; and 

‘‘(ii) protect elders with diminished capacity while 

maximizing their autonomy; and 

‘‘(B) from an individual perspective, the recognition 

of an elder’s rights, including the right to be free of abuse, 

neglect, and exploitation. 

‘‘(7) ELIGIBLE ENTITY.—The term ‘eligible entity’ means a 

State or local government agency, Indian tribe or tribal 

organization, or any other public or private entity that is 

engaged in and has expertise in issues relating to elder justice 

or in a field necessary to promote elder justice efforts. 

‘‘(8) EXPLOITATION.—The term ‘exploitation’ means the 

fraudulent or otherwise illegal, unauthorized, or improper act 

or process of an individual, including a caregiver or fiduciary, 

that uses the resources of an elder for monetary or personal 

benefit, profit, or gain, or that results in depriving an elder 

of rightful access to, or use of, benefits, resources, belongings, 

or assets. 

‘‘(9) FIDUCIARY.—The term ‘fiduciary’— 

‘‘(A) means a person or entity with the legal responsibility— 

‘‘(i) to make decisions on behalf of and for the 

benefit of another person; and 

‘‘(ii) to act in good faith and with fairness; and 

‘‘(B) includes a trustee, a guardian, a conservator, an 

executor, an agent under a financial power of attorney 

or health care power of attorney, or a representative payee. 
H. R. 3590—666 

‘‘(10) GRANT.—The term ‘grant’ includes a contract, cooperative agreement, or other mechanism for providing financial 

assistance. 

‘‘(11) GUARDIANSHIP.—The term ‘guardianship’ means— 

‘‘(A) the process by which a State court determines 

that an adult individual lacks capacity to make decisions 

about self-care or property, and appoints another individual 

or entity known as a guardian, as a conservator, or by 

a similar term, as a surrogate decisionmaker; 

‘‘(B) the manner in which the court-appointed surrogate 

decisionmaker carries out duties to the individual and the 

court; or 

‘‘(C) the manner in which the court exercises oversight 

of the surrogate decisionmaker. 

‘‘(12) INDIAN TRIBE.— 

‘‘(A) IN GENERAL.—The term ‘Indian tribe’ has the 

meaning given such term in section 4 of the Indian SelfDetermination and Education Assistance Act (25 U.S.C. 

450b). 

‘‘(B) INCLUSION OF PUEBLO AND RANCHERIA.—The term 

‘Indian tribe’ includes any Pueblo or Rancheria. 

‘‘(13) LAW ENFORCEMENT.—The term ‘law enforcement’ 

means the full range of potential responders to elder abuse, 

neglect, and exploitation including— 

‘‘(A) police, sheriffs, detectives, public safety officers, 

and corrections personnel; 

‘‘(B) prosecutors; 

‘‘(C) medical examiners; 

‘‘(D) investigators; and 

‘‘(E) coroners. 

‘‘(14) LONG-TERM CARE.— 

‘‘(A) IN GENERAL.—The term ‘long-term care’ means 

supportive and health services specified by the Secretary 

for individuals who need assistance because the individuals 

have a loss of capacity for self-care due to illness, disability, 

or vulnerability. 

‘‘(B) LOSS OF CAPACITY FOR SELF-CARE.—For purposes 

of subparagraph (A), the term ‘loss of capacity for selfcare’ means an inability to engage in 1 or more activities 

of daily living, including eating, dressing, bathing, management of one’s financial affairs, and other activities the 

Secretary determines appropriate. 

‘‘(15) LONG-TERM CARE FACILITY.—The term ‘long-term care 

facility’ means a residential care provider that arranges for, 

or directly provides, long-term care. 

‘‘(16) NEGLECT.—The term ‘neglect’ means— 

‘‘(A) the failure of a caregiver or fiduciary to provide 

the goods or services that are necessary to maintain the 

health or safety of an elder; or 

‘‘(B) self-neglect. 

‘‘(17) NURSING FACILITY.— 

‘‘(A) IN GENERAL.—The term ‘nursing facility’ has the 

meaning given such term under section 1919(a). 

‘‘(B) INCLUSION OF SKILLED NURSING FACILITY.—The 

term ‘nursing facility’ includes a skilled nursing facility 

(as defined in section 1819(a)). 
H. R. 3590—667 

‘‘(18) SELF-NEGLECT.—The term ‘self-neglect’ means an 

adult’s inability, due to physical or mental impairment or 

diminished capacity, to perform essential self-care tasks 

including— 

‘‘(A) obtaining essential food, clothing, shelter, and 

medical care; 

‘‘(B) obtaining goods and services necessary to maintain 

physical health, mental health, or general safety; or 

‘‘(C) managing one’s own financial affairs. 

‘‘(19) SERIOUS BODILY INJURY.— 

‘‘(A) IN GENERAL.—The term ‘serious bodily injury’ 

means an injury— 

‘‘(i) involving extreme physical pain; 

‘‘(ii) involving substantial risk of death; 

‘‘(iii) involving protracted loss or impairment of 

the function of a bodily member, organ, or mental 

faculty; or 

‘‘(iv) requiring medical intervention such as surgery, hospitalization, or physical rehabilitation. 

‘‘(B) CRIMINAL SEXUAL ABUSE.—Serious bodily injury 

shall be considered to have occurred if the conduct causing 

the injury is conduct described in section 2241 (relating 

to aggravated sexual abuse) or 2242 (relating to sexual 

abuse) of title 18, United States Code, or any similar offense 

under State law. 

‘‘(20) SOCIAL.—The term ‘social’, when used with respect 

to a service, includes adult protective services. 

‘‘(21) STATE LEGAL ASSISTANCE DEVELOPER.—The term 

‘State legal assistance developer’ means an individual described 

in section 731 of the Older Americans Act of 1965. 

‘‘(22) STATE LONG-TERM CARE OMBUDSMAN.—The term 

‘State Long-Term Care Ombudsman’ means the State LongTerm Care Ombudsman described in section 712(a)(2) of the 

Older Americans Act of 1965. 

‘‘SEC. 2012. GENERAL PROVISIONS. 

‘‘(a) PROTECTION OF PRIVACY.—In pursuing activities under this 

subtitle, the Secretary shall ensure the protection of individual 

health privacy consistent with the regulations promulgated under 

section 264(c) of the Health Insurance Portability and Accountability 

Act of 1996 and applicable State and local privacy regulations. 

‘‘(b) RULE OF CONSTRUCTION.—Nothing in this subtitle shall 

be construed to interfere with or abridge an elder’s right to practice 

his or her religion through reliance on prayer alone for healing 

when this choice— 

‘‘(1) is contemporaneously expressed, either orally or in 

writing, with respect to a specific illness or injury which the 

elder has at the time of the decision by an elder who is competent at the time of the decision; 

‘‘(2) is previously set forth in a living will, health care 

proxy, or other advance directive document that is validly 

executed and applied under State law; or 

‘‘(3) may be unambiguously deduced from the elder’s life 

history. 
H. R. 3590—668 

‘‘PART I—NATIONAL COORDINATION OF 

ELDER JUSTICE ACTIVITIES AND RESEARCH 

‘‘Subpart A—Elder Justice Coordinating Council 

and Advisory Board on Elder Abuse, Neglect, 

and Exploitation 

‘‘SEC. 2021. ELDER JUSTICE COORDINATING COUNCIL. 

‘‘(a) ESTABLISHMENT.—There is established within the Office 

of the Secretary an Elder Justice Coordinating Council (in this 

section referred to as the ‘Council’). 

‘‘(b) MEMBERSHIP.— ‘‘(1) IN GENERAL.—The Council shall be composed of the 

following members: 

‘‘(A) The Secretary (or the Secretary’s designee). 

‘‘(B) The Attorney General (or the Attorney General’s 

designee). 

‘‘(C) The head of each Federal department or agency 

or other governmental entity identified by the Chair 

referred to in subsection (d) as having responsibilities, or 

administering programs, relating to elder abuse, neglect, 

and exploitation. 

‘‘(2) REQUIREMENT.—Each member of the Council shall be 

an officer or employee of the Federal Government. 

‘‘(c) VACANCIES.—Any vacancy in the Council shall not affect 

its powers, but shall be filled in the same manner as the original 

appointment was made. 

‘‘(d) CHAIR.—The member described in subsection (b)(1)(A) shall 

be Chair of the Council. 

‘‘(e) MEETINGS.—The Council shall meet at least 2 times per 

year, as determined by the Chair. 

‘‘(f) DUTIES.— ‘‘(1) IN GENERAL.—The Council shall make recommendations to the Secretary for the coordination of activities of the 

Department of Health and Human Services, the Department 

of Justice, and other relevant Federal, State, local, and private 

agencies and entities, relating to elder abuse, neglect, and 

exploitation and other crimes against elders. 

‘‘(2) REPORT.—Not later than the date that is 2 years after 

the date of enactment of the Elder Justice Act of 2009 and 

every 2 years thereafter, the Council shall submit to the Committee on Finance of the Senate and the Committee on Ways 

and Means and the Committee on Energy and Commerce of 

the House of Representatives a report that— 

‘‘(A) describes the activities and accomplishments of, 

and challenges faced by— 

‘‘(i) the Council; and 

‘‘(ii) the entities represented on the Council; and 

‘‘(B) makes such recommendations for legislation, 

model laws, or other action as the Council determines 

to be appropriate. 

‘‘(g) POWERS OF THE COUNCIL.— 

‘‘(1) INFORMATION FROM FEDERAL AGENCIES.—Subject to the 

requirements of section 2012(a), the Council may secure directly 

from any Federal department or agency such information as 

the Council considers necessary to carry out this section. Upon 
H. R. 3590—669 

request of the Chair of the Council, the head of such department 

or agency shall furnish such information to the Council. 

‘‘(2) POSTAL SERVICES.—The Council may use the United 

States mails in the same manner and under the same conditions 

as other departments and agencies of the Federal Government. 

‘‘(h) TRAVEL EXPENSES.—The members of the Council shall 

not receive compensation for the performance of services for the 

Council. The members shall be allowed travel expenses, including 

per diem in lieu of subsistence, at rates authorized for employees 

of agencies under subchapter I of chapter 57 of title 5, United 

States Code, while away from their homes or regular places of 

business in the performance of services for the Council. Notwithstanding section 1342 of title 31, United States Code, the Secretary 

may accept the voluntary and uncompensated services of the members of the Council. 

‘‘(i) DETAIL OF GOVERNMENT EMPLOYEES.—Any Federal Government employee may be detailed to the Council without reimbursement, and such detail shall be without interruption or loss of 

civil service status or privilege. 

‘‘(j) STATUS AS PERMANENT COUNCIL.—Section 14 of the Federal 

Advisory Committee Act (5 U.S.C. App.) shall not apply to the 

Council. 

‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this 

section. 

‘‘SEC. 2022. ADVISORY BOARD ON ELDER ABUSE, NEGLECT, AND 

EXPLOITATION. 

‘‘(a) ESTABLISHMENT.—There is established a board to be known 

as the ‘Advisory Board on Elder Abuse, Neglect, and Exploitation’ 

(in this section referred to as the ‘Advisory Board’) to create shortand long-term multidisciplinary strategic plans for the development 

of the field of elder justice and to make recommendations to the 

Elder Justice Coordinating Council established under section 2021. 

‘‘(b) COMPOSITION.—The Advisory Board shall be composed of 

27 members appointed by the Secretary from among members of 

the general public who are individuals with experience and expertise 

in elder abuse, neglect, and exploitation prevention, detection, treatment, intervention, or prosecution. 

‘‘(c) SOLICITATION OF NOMINATIONS.—The Secretary shall publish a notice in the Federal Register soliciting nominations for 

the appointment of members of the Advisory Board under subsection 

(b). 

‘‘(d) TERMS.— 

‘‘(1) IN GENERAL.—Each member of the Advisory Board 

shall be appointed for a term of 3 years, except that, of the 

members first appointed— 

‘‘(A) 9 shall be appointed for a term of 3 years; 

‘‘(B) 9 shall be appointed for a term of 2 years; and 

‘‘(C) 9 shall be appointed for a term of 1 year. 

‘‘(2) VACANCIES.— ‘‘(A) IN GENERAL.—Any vacancy on the Advisory Board 

shall not affect its powers, but shall be filled in the same 

manner as the original appointment was made. 

‘‘(B) FILLING UNEXPIRED TERM.—An individual chosen 

to fill a vacancy shall be appointed for the unexpired term 

of the member replaced. 
H. R. 3590—670 

‘‘(3) EXPIRATION OF TERMS.—The term of any member shall 

not expire before the date on which the member’s successor 

takes office. 

‘‘(e) ELECTION OF OFFICERS.—The Advisory Board shall elect 

a Chair and Vice Chair from among its members. The Advisory 

Board shall elect its initial Chair and Vice Chair at its initial 

meeting. 

‘‘(f) DUTIES.— 

‘‘(1) ENHANCE COMMUNICATION ON PROMOTING QUALITY OF, 

AND PREVENTING ABUSE, NEGLECT, AND EXPLOITATION IN, LONGTERM CARE.—The Advisory Board shall develop collaborative 

and innovative approaches to improve the quality of, including 

preventing abuse, neglect, and exploitation in, long-term care. 

‘‘(2) COLLABORATIVE EFFORTS TO DEVELOP CONSENSUS

AROUND THE MANAGEMENT OF CERTAIN QUALITY-RELATED FACTORS.— 

‘‘(A) IN GENERAL.—The Advisory Board shall establish 

multidisciplinary panels to address, and develop consensus 

on, subjects relating to improving the quality of long-term 

care. At least 1 such panel shall address, and develop 

consensus on, methods for managing resident-to-resident 

abuse in long-term care. 

‘‘(B) ACTIVITIES CONDUCTED.—The multidisciplinary 

panels established under subparagraph (A) shall examine 

relevant research and data, identify best practices with 

respect to the subject of the panel, determine the best 

way to carry out those best practices in a practical and 

feasible manner, and determine an effective manner of 

distributing information on such subject. 

‘‘(3) REPORT.—Not later than the date that is 18 months 

after the date of enactment of the Elder Justice Act of 2009, 

and annually thereafter, the Advisory Board shall prepare and 

submit to the Elder Justice Coordinating Council, the Committee on Finance of the Senate, and the Committee on Ways 

and Means and the Committee on Energy and Commerce of 

the House of Representatives a report containing— 

‘‘(A) information on the status of Federal, State, and 

local public and private elder justice activities; 

‘‘(B) recommendations (including recommended priorities) regarding— 

‘‘(i) elder justice programs, research, training, services, practice, enforcement, and coordination; 

‘‘(ii) coordination between entities pursuing elder 

justice efforts and those involved in related areas that 

may inform or overlap with elder justice efforts, such 

as activities to combat violence against women and 

child abuse and neglect; and 

‘‘(iii) activities relating to adult fiduciary systems, 

including guardianship and other fiduciary arrangements; 

‘‘(C) recommendations for specific modifications needed 

in Federal and State laws (including regulations) or for 

programs, research, and training to enhance prevention, 

detection, and treatment (including diagnosis) of, intervention in (including investigation of), and prosecution of elder 

abuse, neglect, and exploitation; 
H. R. 3590—671 

‘‘(D) recommendations on methods for the most effective coordinated national data collection with respect to 

elder justice, and elder abuse, neglect, and exploitation; 

and 

‘‘(E) recommendations for a multidisciplinary strategic 

plan to guide the effective and efficient development of 

the field of elder justice. 

‘‘(g) POWERS OF THE ADVISORY BOARD.— 

‘‘(1) INFORMATION FROM FEDERAL AGENCIES.—Subject to the 

requirements of section 2012(a), the Advisory Board may secure 

directly from any Federal department or agency such information as the Advisory Board considers necessary to carry out 

this section. Upon request of the Chair of the Advisory Board, 

the head of such department or agency shall furnish such 

information to the Advisory Board. 

‘‘(2) SHARING OF DATA AND REPORTS.—The Advisory Board 

may request from any entity pursuing elder justice activities 

under the Elder Justice Act of 2009 or an amendment made 

by that Act, any data, reports, or recommendations generated 

in connection with such activities. 

‘‘(3) POSTAL SERVICES.—The Advisory Board may use the 

United States mails in the same manner and under the same 

conditions as other departments and agencies of the Federal 

Government. 

‘‘(h) TRAVEL EXPENSES.—The members of the Advisory Board 

shall not receive compensation for the performance of services for 

the Advisory Board. The members shall be allowed travel expenses 

for up to 4 meetings per year, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter 

I of chapter 57 of title 5, United States Code, while away from 

their homes or regular places of business in the performance of 

services for the Advisory Board. Notwithstanding section 1342 of 

title 31, United States Code, the Secretary may accept the voluntary 

and uncompensated services of the members of the Advisory Board. 

‘‘(i) DETAIL OF GOVERNMENT EMPLOYEES.—Any Federal Government employee may be detailed to the Advisory Board without 

reimbursement, and such detail shall be without interruption or 

loss of civil service status or privilege. 

‘‘(j) STATUS AS PERMANENT ADVISORY COMMITTEE.—Section 14 

of the Federal Advisory Committee Act (5 U.S.C. App.) shall not 

apply to the advisory board. 

‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated such sums as are necessary to carry out this 

section. 

‘‘SEC. 2023. RESEARCH PROTECTIONS. 

‘‘(a) GUIDELINES.—The Secretary shall promulgate guidelines 

to assist researchers working in the area of elder abuse, neglect, 

and exploitation, with issues relating to human subject protections. 

‘‘(b) DEFINITION OF LEGALLY AUTHORIZED REPRESENTATIVE FOR

APPLICATION OF REGULATIONS.—For purposes of the application 

of subpart A of part 46 of title 45, Code of Federal Regulations, 

to research conducted under this subpart, the term ‘legally authorized representative’ means, unless otherwise provided by law, the 

individual or judicial or other body authorized under the applicable 

law to consent to medical treatment on behalf of another person. 
H. R. 3590—672 

‘‘SEC. 2024. AUTHORIZATION OF APPROPRIATIONS. 

‘‘There are authorized to be appropriated to carry out this 

subpart— 

‘‘(1) for fiscal year 2011, $6,500,000; and 

‘‘(2) for each of fiscal years 2012 through 2014, $7,000,000. 

‘‘Subpart B—Elder Abuse, Neglect, and 

Exploitation Forensic Centers 

‘‘SEC. 2031. ESTABLISHMENT AND SUPPORT OF ELDER ABUSE, 

NEGLECT, AND EXPLOITATION FORENSIC CENTERS. 

‘‘(a) IN GENERAL.—The Secretary, in consultation with the 

Attorney General, shall make grants to eligible entities to establish 

and operate stationary and mobile forensic centers, to develop 

forensic expertise regarding, and provide services relating to, elder 

abuse, neglect, and exploitation. 

‘‘(b) STATIONARY FORENSIC CENTERS.—The Secretary shall 

make 4 of the grants described in subsection (a) to institutions 

of higher education with demonstrated expertise in forensics or 

commitment to preventing or treating elder abuse, neglect, or exploitation, to establish and operate stationary forensic centers. 

‘‘(c) MOBILE CENTERS.—The Secretary shall make 6 of the 

grants described in subsection (a) to appropriate entities to establish 

and operate mobile forensic centers. 

‘‘(d) AUTHORIZED ACTIVITIES.— 

‘‘(1) DEVELOPMENT OF FORENSIC MARKERS AND METHODOLOGIES.—An eligible entity that receives a grant under this section 

shall use funds made available through the grant to assist 

in determining whether abuse, neglect, or exploitation occurred 

and whether a crime was committed and to conduct research 

to describe and disseminate information on— 

‘‘(A) forensic markers that indicate a case in which 

elder abuse, neglect, or exploitation may have occurred; 

and 

‘‘(B) methodologies for determining, in such a case, 

when and how health care, emergency service, social and 

protective services, and legal service providers should intervene and when the providers should report the case to 

law enforcement authorities. 

‘‘(2) DEVELOPMENT OF FORENSIC EXPERTISE.—An eligible 

entity that receives a grant under this section shall use funds 

made available through the grant to develop forensic expertise 

regarding elder abuse, neglect, and exploitation in order to 

provide medical and forensic evaluation, therapeutic intervention, victim support and advocacy, case review, and case 

tracking. 

‘‘(3) COLLECTION OF EVIDENCE.—The Secretary, in coordination with the Attorney General, shall use data made available 

by grant recipients under this section to develop the capacity 

of geriatric health care professionals and law enforcement to 

collect forensic evidence, including collecting forensic evidence 

relating to a potential determination of elder abuse, neglect, 

or exploitation. 

‘‘(e) APPLICATION.—To be eligible to receive a grant under this 

section, an entity shall submit an application to the Secretary 
H. R. 3590—673 

at such time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section— 

‘‘(1) for fiscal year 2011, $4,000,000; 

‘‘(2) for fiscal year 2012, $6,000,000; and 

‘‘(3) for each of fiscal years 2013 and 2014, $8,000,000. 

‘‘PART II—PROGRAMS TO PROMOTE ELDER 

JUSTICE 

‘‘SEC. 2041. ENHANCEMENT OF LONG-TERM CARE. 

‘‘(a) GRANTS AND INCENTIVES FOR LONG-TERM CARE STAFFING.— ‘‘(1) IN GENERAL.—The Secretary shall carry out activities, 

including activities described in paragraphs (2) and (3), to provide incentives for individuals to train for, seek, and maintain 

employment providing direct care in long-term care. 

‘‘(2) SPECIFIC PROGRAMS TO ENHANCE TRAINING, RECRUIT- MENT, AND RETENTION OF STAFF.— ‘‘(A) COORDINATION WITH SECRETARY OF LABOR TO

RECRUIT AND TRAIN LONG-TERM CARE STAFF.—The Secretary 

shall coordinate activities under this subsection with the 

Secretary of Labor in order to provide incentives for individuals to train for and seek employment providing direct 

care in long-term care. 

‘‘(B) CAREER LADDERS AND WAGE OR BENEFIT INCREASES

TO INCREASE STAFFING IN LONG-TERM CARE.— ‘‘(i) IN GENERAL.—The Secretary shall make grants 

to eligible entities to carry out programs through which 

the entities— 

‘‘(I) offer, to employees who provide direct care 

to residents of an eligible entity or individuals 

receiving community-based long-term care from an 

eligible entity, continuing training and varying 

levels of certification, based on observed clinical 

care practices and the amount of time the 

employees spend providing direct care; and 

‘‘(II) provide, or make arrangements to provide, bonuses or other increased compensation or 

benefits to employees who achieve certification 

under such a program. 

‘‘(ii) APPLICATION.—To be eligible to receive a grant 

under this subparagraph, an eligible entity shall 

submit an application to the Secretary at such time, 

in such manner, and containing such information as 

the Secretary may require (which may include evidence 

of consultation with the State in which the eligible 

entity is located with respect to carrying out activities 

funded under the grant). 

‘‘(iii) AUTHORITY TO LIMIT NUMBER OF

APPLICANTS.—Nothing in this subparagraph shall be 

construed as prohibiting the Secretary from limiting 

the number of applicants for a grant under this 

subparagraph. 

‘‘(3) SPECIFIC PROGRAMS TO IMPROVE MANAGEMENT PRAC- TICES.— 
H. R. 3590—674 

‘‘(A) IN GENERAL.—The Secretary shall make grants 

to eligible entities to enable the entities to provide training 

and technical assistance. 

‘‘(B) AUTHORIZED ACTIVITIES.—An eligible entity that 

receives a grant under subparagraph (A) shall use funds 

made available through the grant to provide training and 

technical assistance regarding management practices using 

methods that are demonstrated to promote retention of 

individuals who provide direct care, such as— 

‘‘(i) the establishment of standard human resource 

policies that reward high performance, including policies that provide for improved wages and benefits on 

the basis of job reviews; 

‘‘(ii) the establishment of motivational and 

thoughtful work organization practices; 

‘‘(iii) the creation of a workplace culture that 

respects and values caregivers and their needs; 

‘‘(iv) the promotion of a workplace culture that 

respects the rights of residents of an eligible entity 

or individuals receiving community-based long-term 

care from an eligible entity and results in improved 

care for the residents or the individuals; and 

‘‘(v) the establishment of other programs that promote the provision of high quality care, such as a 

continuing education program that provides additional 

hours of training, including on-the-job training, for 

employees who are certified nurse aides. 

‘‘(C) APPLICATION.—To be eligible to receive a grant 

under this paragraph, an eligible entity shall submit an 

application to the Secretary at such time, in such manner, 

and containing such information as the Secretary may 

require (which may include evidence of consultation with 

the State in which the eligible entity is located with respect 

to carrying out activities funded under the grant). 

‘‘(D) AUTHORITY TO LIMIT NUMBER OF APPLICANTS.— Nothing in this paragraph shall be construed as prohibiting 

the Secretary from limiting the number of applicants for 

a grant under this paragraph. 

‘‘(4) ACCOUNTABILITY MEASURES.—The Secretary shall 

develop accountability measures to ensure that the activities 

conducted using funds made available under this subsection 

benefit individuals who provide direct care and increase the 

stability of the long-term care workforce. 

‘‘(5) DEFINITIONS.—In this subsection: 

‘‘(A) COMMUNITY-BASED LONG-TERM CARE.—The term 

‘community-based long-term care’ has the meaning given 

such term by the Secretary. 

‘‘(B) ELIGIBLE ENTITY.—The term ‘eligible entity’ means 

the following: 

‘‘(i) A long-term care facility. 

‘‘(ii) A community-based long-term care entity (as 

defined by the Secretary). 

‘‘(b) CERTIFIED EHR TECHNOLOGY GRANT PROGRAM.— 

‘‘(1) GRANTS AUTHORIZED.—The Secretary is authorized to 

make grants to long-term care facilities for the purpose of 

assisting such entities in offsetting the costs related to purchasing, leasing, developing, and implementing certified EHR 
H. R. 3590—675 

technology (as defined in section 1848(o)(4)) designed to improve 

patient safety and reduce adverse events and health care complications resulting from medication errors. 

‘‘(2) USE OF GRANT FUNDS.—Funds provided under grants 

under this subsection may be used for any of the following: 

‘‘(A) Purchasing, leasing, and installing computer software and hardware, including handheld computer technologies. 

‘‘(B) Making improvements to existing computer software and hardware. 

‘‘(C) Making upgrades and other improvements to 

existing computer software and hardware to enable e-prescribing. 

‘‘(D) Providing education and training to eligible longterm care facility staff on the use of such technology to 

implement the electronic transmission of prescription and 

patient information. 

‘‘(3) APPLICATION.— 

‘‘(A) IN GENERAL.—To be eligible to receive a grant 

under this subsection, a long-term care facility shall submit 

an application to the Secretary at such time, in such 

manner, and containing such information as the Secretary 

may require (which may include evidence of consultation 

with the State in which the long-term care facility is located 

with respect to carrying out activities funded under the 

grant). 

‘‘(B) AUTHORITY TO LIMIT NUMBER OF APPLICANTS.— 

Nothing in this subsection shall be construed as prohibiting 

the Secretary from limiting the number of applicants for 

a grant under this subsection. 

‘‘(4) PARTICIPATION IN STATE HEALTH EXCHANGES.—A longterm care facility that receives a grant under this subsection 

shall, where available, participate in activities conducted by 

a State or a qualified State-designated entity (as defined in 

section 3013(f) of the Public Health Service Act) under a grant 

under section 3013 of the Public Health Service Act to coordinate care and for other purposes determined appropriate by 

the Secretary. 

‘‘(5) ACCOUNTABILITY MEASURES.—The Secretary shall 

develop accountability measures to ensure that the activities 

conducted using funds made available under this subsection 

help improve patient safety and reduce adverse events and 

health care complications resulting from medication errors. 

‘‘(c) ADOPTION OF STANDARDS FOR TRANSACTIONS INVOLVING

CLINICAL DATA BY LONG-TERM CARE FACILITIES.— 

‘‘(1) STANDARDS AND COMPATIBILITY.—The Secretary shall 

adopt electronic standards for the exchange of clinical data 

by long-term care facilities, including, where available, standards for messaging and nomenclature. Standards adopted by 

the Secretary under the preceding sentence shall be compatible 

with standards established under part C of title XI, standards 

established under subsections (b)(2)(B)(i) and (e)(4) of section 

1860D–4, standards adopted under section 3004 of the Public 

Health Service Act, and general health information technology 

standards. 

‘‘(2) ELECTRONIC SUBMISSION OF DATA TO THE SECRETARY.— 
H. R. 3590—676 

‘‘(A) IN GENERAL.—Not later than 10 years after the 

date of enactment of the Elder Justice Act of 2009, the 

Secretary shall have procedures in place to accept the 

optional electronic submission of clinical data by long-term 

care facilities pursuant to the standards adopted under 

paragraph (1). 

‘‘(B) RULE OF CONSTRUCTION.—Nothing in this subsection shall be construed to require a long-term care 

facility to submit clinical data electronically to the Secretary. 

‘‘(3) REGULATIONS.—The Secretary shall promulgate regulations to carry out this subsection. Such regulations shall require 

a State, as a condition of the receipt of funds under this 

part, to conduct such data collection and reporting as the Secretary determines are necessary to satisfy the requirements 

of this subsection. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section— 

‘‘(1) for fiscal year 2011, $20,000,000; 

‘‘(2) for fiscal year 2012, $17,500,000; and 

‘‘(3) for each of fiscal years 2013 and 2014, $15,000,000. 

‘‘SEC. 2042. ADULT PROTECTIVE SERVICES FUNCTIONS AND GRANT 

PROGRAMS. 

‘‘(a) SECRETARIAL RESPONSIBILITIES.— ‘‘(1) IN GENERAL.—The Secretary shall ensure that the 

Department of Health and Human Services— 

‘‘(A) provides funding authorized by this part to State 

and local adult protective services offices that investigate 

reports of the abuse, neglect, and exploitation of elders; 

‘‘(B) collects and disseminates data annually relating 

to the abuse, exploitation, and neglect of elders in coordination with the Department of Justice; 

‘‘(C) develops and disseminates information on best 

practices regarding, and provides training on, carrying out 

adult protective services; 

‘‘(D) conducts research related to the provision of adult 

protective services; and 

‘‘(E) provides technical assistance to States and other 

entities that provide or fund the provision of adult protective services, including through grants made under subsections (b) and (c). 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection, 

$3,000,000 for fiscal year 2011 and $4,000,000 for each of 

fiscal years 2012 through 2014. 

‘‘(b) GRANTS TO ENHANCE THE PROVISION OF ADULT PROTECTIVE

SERVICES.— 

‘‘(1) ESTABLISHMENT.—There is established an adult protective services grant program under which the Secretary shall 

annually award grants to States in the amounts calculated 

under paragraph (2) for the purposes of enhancing adult protective services provided by States and local units of government. 

‘‘(2) AMOUNT OF PAYMENT.— ‘‘(A) IN GENERAL.—Subject to the availability of appropriations and subparagraphs (B) and (C), the amount paid 

to a State for a fiscal year under the program under this 
H. R. 3590—677 

subsection shall equal the amount appropriated for that 

year to carry out this subsection multiplied by the percentage of the total number of elders who reside in the United 

States who reside in that State. 

‘‘(B) GUARANTEED MINIMUM PAYMENT AMOUNT.— 

‘‘(i) 50 STATES.—Subject to clause (ii), if the amount 

determined under subparagraph (A) for a State for 

a fiscal year is less than 0.75 percent of the amount 

appropriated for such year, the Secretary shall increase 

such determined amount so that the total amount paid 

under this subsection to the State for the year is equal 

to 0.75 percent of the amount so appropriated. 

‘‘(ii) TERRITORIES.—In the case of a State other 

than 1 of the 50 States, clause (i) shall be applied 

as if each reference to ‘0.75’ were a reference to ‘0.1’. 

‘‘(C) PRO RATA REDUCTIONS.—The Secretary shall make 

such pro rata reductions to the amounts described in 

subparagraph (A) as are necessary to comply with the 

requirements of subparagraph (B). 

‘‘(3) AUTHORIZED ACTIVITIES.— 

‘‘(A) ADULT PROTECTIVE SERVICES.—Funds made available pursuant to this subsection may only be used by 

States and local units of government to provide adult 

protective services and may not be used for any other 

purpose. 

‘‘(B) USE BY AGENCY.—Each State receiving funds 

pursuant to this subsection shall provide such funds to 

the agency or unit of State government having legal responsibility for providing adult protective services within the 

State. 

‘‘(C) SUPPLEMENT NOT SUPPLANT.—Each State or local 

unit of government shall use funds made available pursuant to this subsection to supplement and not supplant 

other Federal, State, and local public funds expended to 

provide adult protective services in the State. 

‘‘(4) STATE REPORTS.—Each State receiving funds under 

this subsection shall submit to the Secretary, at such time 

and in such manner as the Secretary may require, a report 

on the number of elders served by the grants awarded under 

this subsection. 

‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection, 

$100,000,000 for each of fiscal years 2011 through 2014. 

‘‘(c) STATE DEMONSTRATION PROGRAMS.— 

‘‘(1) ESTABLISHMENT.—The Secretary shall award grants 

to States for the purposes of conducting demonstration programs in accordance with paragraph (2). 

‘‘(2) DEMONSTRATION PROGRAMS.—Funds made available 

pursuant to this subsection may be used by States and local 

units of government to conduct demonstration programs that 

test— 

‘‘(A) training modules developed for the purpose of 

detecting or preventing elder abuse; 

‘‘(B) methods to detect or prevent financial exploitation 

of elders; 

‘‘(C) methods to detect elder abuse; 
H. R. 3590—678 

‘‘(D) whether training on elder abuse forensics 

enhances the detection of elder abuse by employees of 

the State or local unit of government; or 

‘‘(E) other matters relating to the detection or prevention of elder abuse. 

‘‘(3) APPLICATION.—To be eligible to receive a grant under 

this subsection, a State shall submit an application to the 

Secretary at such time, in such manner, and containing such 

information as the Secretary may require. 

‘‘(4) STATE REPORTS.—Each State that receives funds under 

this subsection shall submit to the Secretary a report at such 

time, in such manner, and containing such information as 

the Secretary may require on the results of the demonstration 

program conducted by the State using funds made available 

under this subsection. 

‘‘(5) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection, 

$25,000,000 for each of fiscal years 2011 through 2014. 

‘‘SEC. 2043. LONG-TERM CARE OMBUDSMAN PROGRAM GRANTS AND 

TRAINING. 

‘‘(a) GRANTS TO SUPPORT THE LONG-TERM CARE OMBUDSMAN

PROGRAM.— 

‘‘(1) IN GENERAL.—The Secretary shall make grants to 

eligible entities with relevant expertise and experience in abuse 

and neglect in long-term care facilities or long-term care 

ombudsman programs and responsibilities, for the purpose of— 

‘‘(A) improving the capacity of State long-term care 

ombudsman programs to respond to and resolve complaints 

about abuse and neglect; 

‘‘(B) conducting pilot programs with State long-term 

care ombudsman offices or local ombudsman entities; and 

‘‘(C) providing support for such State long-term care 

ombudsman programs and such pilot programs (such as 

through the establishment of a national long-term care 

ombudsman resource center). 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection— ‘‘(A) for fiscal year 2011, $5,000,000; 

‘‘(B) for fiscal year 2012, $7,500,000; and 

‘‘(C) for each of fiscal years 2013 and 2014, $10,000,000. 

‘‘(b) OMBUDSMAN TRAINING PROGRAMS.— 

‘‘(1) IN GENERAL.—The Secretary shall establish programs 

to provide and improve ombudsman training with respect to 

elder abuse, neglect, and exploitation for national organizations 

and State long-term care ombudsman programs. 

‘‘(2) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection, 

for each of fiscal years 2011 through 2014, $10,000,000. 

‘‘SEC. 2044. PROVISION OF INFORMATION REGARDING, AND EVALUATIONS OF, ELDER JUSTICE PROGRAMS. 

‘‘(a) PROVISION OF INFORMATION.—To be eligible to receive a 

grant under this part, an applicant shall agree— 

‘‘(1) except as provided in paragraph (2), to provide the 

eligible entity conducting an evaluation under subsection (b) 

of the activities funded through the grant with such information 
H. R. 3590—679 

as the eligible entity may require in order to conduct such 

evaluation; or 

‘‘(2) in the case of an applicant for a grant under section 

2041(b), to provide the Secretary with such information as 

the Secretary may require to conduct an evaluation or audit 

under subsection (c). 

‘‘(b) USE OF ELIGIBLE ENTITIES TO CONDUCT EVALUATIONS.— 

‘‘(1) EVALUATIONS REQUIRED.—Except as provided in paragraph (2), the Secretary shall— 

‘‘(A) reserve a portion (not less than 2 percent) of 

the funds appropriated with respect to each program carried out under this part; and 

‘‘(B) use the funds reserved under subparagraph (A) 

to provide assistance to eligible entities to conduct evaluations of the activities funded under each program carried 

out under this part. 

‘‘(2) CERTIFIED EHR TECHNOLOGY GRANT PROGRAM NOT

INCLUDED.—The provisions of this subsection shall not apply 

to the certified EHR technology grant program under section 

2041(b). 

‘‘(3) AUTHORIZED ACTIVITIES.—A recipient of assistance 

described in paragraph (1)(B) shall use the funds made available through the assistance to conduct a validated evaluation 

of the effectiveness of the activities funded under a program 

carried out under this part. 

‘‘(4) APPLICATIONS.—To be eligible to receive assistance 

under paragraph (1)(B), an entity shall submit an application 

to the Secretary at such time, in such manner, and containing 

such information as the Secretary may require, including a 

proposal for the evaluation. 

‘‘(5) REPORTS.—Not later than a date specified by the Secretary, an eligible entity receiving assistance under paragraph 

(1)(B) shall submit to the Secretary, the Committee on Ways 

and Means and the Committee on Energy and Commerce of 

the House of Representatives, and the Committee on Finance 

of the Senate a report containing the results of the evaluation 

conducted using such assistance together with such recommendations as the entity determines to be appropriate. 

‘‘(c) EVALUATIONS AND AUDITS OF CERTIFIED EHR TECHNOLOGY

GRANT PROGRAM BY THE SECRETARY.— 

‘‘(1) EVALUATIONS.—The Secretary shall conduct an evaluation of the activities funded under the certified EHR technology 

grant program under section 2041(b). Such evaluation shall 

include an evaluation of whether the funding provided under 

the grant is expended only for the purposes for which it is 

made. 

‘‘(2) AUDITS.—The Secretary shall conduct appropriate 

audits of grants made under section 2041(b). 

‘‘SEC. 2045. REPORT. 

‘‘Not later than October 1, 2014, the Secretary shall submit 

to the Elder Justice Coordinating Council established under section 

2021, the Committee on Ways and Means and the Committee 

on Energy and Commerce of the House of Representatives, and 

the Committee on Finance of the Senate a report— 
H. R. 3590—680 

‘‘(1) compiling, summarizing, and analyzing the information 

contained in the State reports submitted under subsections 

(b)(4) and (c)(4) of section 2042; and 

‘‘(2) containing such recommendations for legislative or 

administrative action as the Secretary determines to be appropriate. 

‘‘SEC. 2046. RULE OF CONSTRUCTION. 

‘‘Nothing in this subtitle shall be construed as— 

‘‘(1) limiting any cause of action or other relief related 

to obligations under this subtitle that is available under the 

law of any State, or political subdivision thereof; or 

‘‘(2) creating a private cause of action for a violation of 

this subtitle.’’. 

(2) OPTION FOR STATE PLAN UNDER PROGRAM FOR TEMPORARY ASSISTANCE FOR NEEDY FAMILIES.— 

(A) IN GENERAL.—Section 402(a)(1)(B) of the Social 

Security Act (42 U.S.C. 602(a)(1)(B)) is amended by adding 

at the end the following new clause: 

‘‘(v) The document shall indicate whether the State 

intends to assist individuals to train for, seek, and 

maintain employment— 

‘‘(I) providing direct care in a long-term care 

facility (as such terms are defined under section 

2011); or 

‘‘(II) in other occupations related to elder care 

determined appropriate by the State for which the 

State identifies an unmet need for service personnel, 

and, if so, shall include an overview of such assistance.’’. 

(B) EFFECTIVE DATE.—The amendment made by 

subparagraph (A) shall take effect on January 1, 2011. 

(b) PROTECTING RESIDENTS OF LONG-TERM CARE FACILITIES.— (1) NATIONAL TRAINING INSTITUTE FOR SURVEYORS.— (A) IN GENERAL.—The Secretary of Health and Human 

Services shall enter into a contract with an entity for 

the purpose of establishing and operating a National 

Training Institute for Federal and State surveyors. Such 

Institute shall provide and improve the training of surveyors with respect to investigating allegations of abuse, 

neglect, and misappropriation of property in programs and 

long-term care facilities that receive payments under title 

XVIII or XIX of the Social Security Act. 

(B) ACTIVITIES CARRIED OUT BY THE INSTITUTE.—The 

contract entered into under subparagraph (A) shall require 

the Institute established and operated under such contract 

to carry out the following activities: 

(i) Assess the extent to which State agencies use 

specialized surveyors for the investigation of reported 

allegations of abuse, neglect, and misappropriation of 

property in such programs and long-term care facilities. 

(ii) Evaluate how the competencies of surveyors 

may be improved to more effectively investigate 

reported allegations of such abuse, neglect, and misappropriation of property, and provide feedback to Federal and State agencies on the evaluations conducted. 
H. R. 3590—681 

(iii) Provide a national program of training, tools, 

and technical assistance to Federal and State surveyors 

on investigating reports of such abuse, neglect, and 

misappropriation of property. 

(iv) Develop and disseminate information on best 

practices for the investigation of such abuse, neglect, 

and misappropriation of property. 

(v) Assess the performance of State complaint 

intake systems, in order to ensure that the intake 

of complaints occurs 24 hours per day, 7 days a week 

(including holidays). 

(vi) To the extent approved by the Secretary of 

Health and Human Services, provide a national 24 

hours per day, 7 days a week (including holidays), 

back-up system to State complaint intake systems in 

order to ensure optimum national responsiveness to 

complaints of such abuse, neglect, and misappropriation of property. 

(vii) Analyze and report annually on the following: 

(I) The total number and sources of complaints 

of such abuse, neglect, and misappropriation of 

property. 

(II) The extent to which such complaints are 

referred to law enforcement agencies. 

(III) General results of Federal and State 

investigations of such complaints. 

(viii) Conduct a national study of the cost to State 

agencies of conducting complaint investigations of 

skilled nursing facilities and nursing facilities under 

sections 1819 and 1919, respectively, of the Social Security Act (42 U.S.C. 1395i–3; 1396r), and making recommendations to the Secretary of Health and Human 

Services with respect to options to increase the efficiency and cost-effectiveness of such investigations. 

(C) AUTHORIZATION.—There are authorized to be appropriated to carry out this paragraph, for the period of fiscal 

years 2011 through 2014, $12,000,000. 

(2) GRANTS TO STATE SURVEY AGENCIES.— (A) IN GENERAL.—The Secretary of Health and Human 

Services shall make grants to State agencies that perform 

surveys of skilled nursing facilities or nursing facilities 

under sections 1819 or 1919, respectively, of the Social 

Security Act (42 U.S.C. 1395i–3; 1395r). 

(B) USE OF FUNDS.—A grant awarded under subparagraph (A) shall be used for the purpose of designing and 

implementing complaint investigations systems that— 

(i) promptly prioritize complaints in order to 

ensure a rapid response to the most serious and urgent 

complaints; 

(ii) respond to complaints with optimum effectiveness and timeliness; and 

(iii) optimize the collaboration between local 

authorities, consumers, and providers, including— 

(I) such State agency; 

(II) the State Long-Term Care Ombudsman; 

(III) local law enforcement agencies; 

(IV) advocacy and consumer organizations; 
H. R. 3590—682 

(V) State aging units; 

(VI) Area Agencies on Aging; and 

(VII) other appropriate entities. 

(C) AUTHORIZATION.—There are authorized to be appropriated to carry out this paragraph, for each of fiscal years 

2011 through 2014, $5,000,000. 

(3) REPORTING OF CRIMES IN FEDERALLY FUNDED LONG- TERM CARE FACILITIES.—Part A of title XI of the Social Security 

Act (42 U.S.C. 1301 et seq.), as amended by section 6005, 

is amended by inserting after section 1150A the following new 

section: 

‘‘REPORTING TO LAW ENFORCEMENT OF CRIMES OCCURRING IN

FEDERALLY FUNDED LONG-TERM CARE FACILITIES

‘‘SEC. 1150B. (a) DETERMINATION AND NOTIFICATION.— ‘‘(1) DETERMINATION.—The owner or operator of each longterm care facility that receives Federal funds under this Act 

shall annually determine whether the facility received at least 

$10,000 in such Federal funds during the preceding year. 

‘‘(2) NOTIFICATION.—If the owner or operator determines under paragraph (1) that the facility received at least $10,000 

in such Federal funds during the preceding year, such owner 

or operator shall annually notify each covered individual (as 

defined in paragraph (3)) of that individual’s obligation to 

comply with the reporting requirements described in subsection 

(b). 

‘‘(3) COVERED INDIVIDUAL DEFINED.—In this section, the 

term ‘covered individual’ means each individual who is an 

owner, operator, employee, manager, agent, or contractor of 

a long-term care facility that is the subject of a determination 

described in paragraph (1). 

‘‘(b) REPORTING REQUIREMENTS.— ‘‘(1) IN GENERAL.—Each covered individual shall report to 

the Secretary and 1 or more law enforcement entities for the 

political subdivision in which the facility is located any reasonable suspicion of a crime (as defined by the law of the applicable 

political subdivision) against any individual who is a resident 

of, or is receiving care from, the facility. 

‘‘(2) TIMING.—If the events that cause the suspicion— 

‘‘(A) result in serious bodily injury, the individual shall 

report the suspicion immediately, but not later than 2 

hours after forming the suspicion; and 

‘‘(B) do not result in serious bodily injury, the individual shall report the suspicion not later than 24 hours 

after forming the suspicion. 

‘‘(c) PENALTIES.— ‘‘(1) IN GENERAL.—If a covered individual violates subsection (b)— 

‘‘(A) the covered individual shall be subject to a civil money penalty of not more than $200,000; and 

‘‘(B) the Secretary may make a determination in the 

same proceeding to exclude the covered individual from 

participation in any Federal health care program (as 

defined in section 1128B(f)). 

‘‘(2) INCREASED HARM.—If a covered individual violates subsection (b) and the violation exacerbates the harm to the victim 

of the crime or results in harm to another individual— 
H. R. 3590—683 

‘‘(A) the covered individual shall be subject to a civil 

money penalty of not more than $300,000; and 

‘‘(B) the Secretary may make a determination in the 

same proceeding to exclude the covered individual from 

participation in any Federal health care program (as 

defined in section 1128B(f)). 

‘‘(3) EXCLUDED INDIVIDUAL.—During any period for which 

a covered individual is classified as an excluded individual 

under paragraph (1)(B) or (2)(B), a long-term care facility that 

employs such individual shall be ineligible to receive Federal 

funds under this Act. 

‘‘(4) EXTENUATING CIRCUMSTANCES.— 

‘‘(A) IN GENERAL.—The Secretary may take into account 

the financial burden on providers with underserved populations in determining any penalty to be imposed under 

this subsection. 

‘‘(B) UNDERSERVED POPULATION DEFINED.—In this 

paragraph, the term ‘underserved population’ means the 

population of an area designated by the Secretary as an 

area with a shortage of elder justice programs or a population group designated by the Secretary as having a shortage of such programs. Such areas or groups designated 

by the Secretary may include— 

‘‘(i) areas or groups that are geographically isolated 

(such as isolated in a rural area); 

‘‘(ii) racial and ethnic minority populations; and 

‘‘(iii) populations underserved because of special 

needs (such as language barriers, disabilities, alien 

status, or age). 

‘‘(d) ADDITIONAL PENALTIES FOR RETALIATION.— ‘‘(1) IN GENERAL.—A long-term care facility may not— 

‘‘(A) discharge, demote, suspend, threaten, harass, or 

deny a promotion or other employment-related benefit to 

an employee, or in any other manner discriminate against 

an employee in the terms and conditions of employment 

because of lawful acts done by the employee; or 

‘‘(B) file a complaint or a report against a nurse or 

other employee with the appropriate State professional disciplinary agency because of lawful acts done by the nurse 

or employee, 

for making a report, causing a report to be made, or for taking 

steps in furtherance of making a report pursuant to subsection 

(b)(1). 

‘‘(2) PENALTIES FOR RETALIATION.—If a long-term care 

facility violates subparagraph (A) or (B) of paragraph (1) the 

facility shall be subject to a civil money penalty of not more 

than $200,000 or the Secretary may classify the entity as 

an excluded entity for a period of 2 years pursuant to section 

1128(b), or both. 

‘‘(3) REQUIREMENT TO POST NOTICE.—Each long-term care 

facility shall post conspicuously in an appropriate location a 

sign (in a form specified by the Secretary) specifying the rights 

of employees under this section. Such sign shall include a 

statement that an employee may file a complaint with the 

Secretary against a long-term care facility that violates the 

provisions of this subsection and information with respect to 

the manner of filing such a complaint. 
H. R. 3590—684 

‘‘(e) PROCEDURE.—The provisions of section 1128A (other than 

subsections (a) and (b) and the second sentence of subsection (f)) 

shall apply to a civil money penalty or exclusion under this section 

in the same manner as such provisions apply to a penalty or 

proceeding under section 1128A(a). 

‘‘(f) DEFINITIONS.—In this section, the terms ‘elder justice’, ‘longterm care facility’, and ‘law enforcement’ have the meanings given 

those terms in section 2011.’’. 

(c) NATIONAL NURSE AIDE REGISTRY.— 

(1) DEFINITION OF NURSE AIDE.—In this subsection, the 

term ‘‘nurse aide’’ has the meaning given that term in sections 

1819(b)(5)(F) and 1919(b)(5)(F) of the Social Security Act (42 

U.S.C. 1395i–3(b)(5)(F); 1396r(b)(5)(F)). 

(2) STUDY AND REPORT.— 

(A) IN GENERAL.—The Secretary, in consultation with 

appropriate government agencies and private sector 

organizations, shall conduct a study on establishing a 

national nurse aide registry. 

(B) AREAS EVALUATED.—The study conducted under 

this subsection shall include an evaluation of— 

(i) who should be included in the registry; 

(ii) how such a registry would comply with Federal 

and State privacy laws and regulations; 

(iii) how data would be collected for the registry; 

(iv) what entities and individuals would have 

access to the data collected; 

(v) how the registry would provide appropriate 

information regarding violations of Federal and State 

law by individuals included in the registry; 

(vi) how the functions of a national nurse aide 

registry would be coordinated with the nationwide program for national and State background checks on 

direct patient access employees of long-term care facilities and providers under section 4301; and 

(vii) how the information included in State nurse 

aide registries developed and maintained under sections 1819(e)(2) and 1919(e)(2) of the Social Security 

Act (42 U.S.C. 1395i–3(e)(2); 1396r(e)(2)(2)) would be 

provided as part of a national nurse aide registry. 

(C) CONSIDERATIONS.—In conducting the study and 

preparing the report required under this subsection, the 

Secretary shall take into consideration the findings and 

conclusions of relevant reports and other relevant 

resources, including the following: 

(i) The Department of Health and Human Services 

Office of Inspector General Report, Nurse Aide Registries: State Compliance and Practices (February 

2005). 

(ii) The General Accounting Office (now known 

as the Government Accountability Office) Report, 

Nursing Homes: More Can Be Done to Protect Residents from Abuse (March 2002). 

(iii) The Department of Health and Human Services Office of the Inspector General Report, Nurse Aide 

Registries: Long-Term Care Facility Compliance and 

Practices (July 2005). 
H. R. 3590—685 

(iv) The Department of Health and Human Services Health Resources and Services Administration 

Report, Nursing Aides, Home Health Aides, and 

Related Health Care Occupations—National and Local 

Workforce Shortages and Associated Data Needs (2004) 

(in particular with respect to chapter 7 and appendix 

F). 

(v) The 2001 Report to CMS from the School of 

Rural Public Health, Texas A&M University, Preventing Abuse and Neglect in Nursing Homes: The 

Role of Nurse Aide Registries. 

(vi) Information included in State nurse aide registries developed and maintained under sections 

1819(e)(2) and 1919(e)(2) of the Social Security Act 

(42 U.S.C. 1395i–3(e)(2); 1396r(e)(2)(2)). 

(D) REPORT.—Not later than 18 months after the date 

of enactment of this Act, the Secretary shall submit to 

the Elder Justice Coordinating Council established under 

section 2021 of the Social Security Act, as added by section 

1805(a), the Committee on Finance of the Senate, and 

the Committee on Ways and Means and the Committee 

on Energy and Commerce of the House of Representatives 

a report containing the findings and recommendations of 

the study conducted under this paragraph. 

(E) FUNDING LIMITATION.—Funding for the study conducted under this subsection shall not exceed $500,000. 

(3) CONGRESSIONAL ACTION.—After receiving the report 

submitted by the Secretary under paragraph (2)(D), the Committee on Finance of the Senate and the Committee on Ways 

and Means and the Committee on Energy and Commerce of 

the House of Representatives shall, as they deem appropriate, 

take action based on the recommendations contained in the 

report. 

(4) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated such sums as are necessary for the 

purpose of carrying out this subsection. 

(d) CONFORMING AMENDMENTS.— 

(1) TITLE XX.—Title XX of the Social Security Act (42 U.S.C. 

1397 et seq.), as amended by section 6703(a), is amended— 

(A) in the heading of section 2001, by striking ‘‘TITLE’’ 

and inserting ‘‘SUBTITLE’’; and 

(B) in subtitle 1, by striking ‘‘this title’’ each place 

it appears and inserting ‘‘this subtitle’’. 

(2) TITLE IV.—Title IV of the Social Security Act (42 U.S.C. 

601 et seq.) is amended— 

(A) in section 404(d)— 

(i) in paragraphs (1)(A), (2)(A), and (3)(B), by 

inserting ‘‘subtitle 1 of’’ before ‘‘title XX’’ each place 

it appears; 

(ii) in the heading of paragraph (2), by inserting 

‘‘SUBTITLE 1 OF’’ before ‘‘TITLE XX’’; and 

(iii) in the heading of paragraph (3)(B), by inserting 

‘‘SUBTITLE 1 OF’’ before ‘‘TITLE XX’’; and 

(B) in sections 422(b), 471(a)(4), 472(h)(1), and 

473(b)(2), by inserting ‘‘subtitle 1 of’’ before ‘‘title XX’’ each 

place it appears. 
H. R. 3590—686 

(3) TITLE XI.—Title XI of the Social Security Act (42 U.S.C. 

1301 et seq.) is amended— 

(A) in section 1128(h)(3)— 

(i) by inserting ‘‘subtitle 1 of’’ before ‘‘title XX’’; 

and 

(ii) by striking ‘‘such title’’ and inserting ‘‘such 

subtitle’’; and 

(B) in section 1128A(i)(1), by inserting ‘‘subtitle 1 of’’ 

before ‘‘title XX’’. 

Subtitle I—Sense of the Senate Regarding 

Medical Malpractice 

SEC. 6801. SENSE OF THE SENATE REGARDING MEDICAL MALPRACTICE. 

It is the sense of the Senate that— 

(1) health care reform presents an opportunity to address 

issues related to medical malpractice and medical liability 

insurance; 

(2) States should be encouraged to develop and test alternatives to the existing civil litigation system as a way of 

improving patient safety, reducing medical errors, encouraging 

the efficient resolution of disputes, increasing the availability 

of prompt and fair resolution of disputes, and improving access 

to liability insurance, while preserving an individual’s right 

to seek redress in court; and 

(3) Congress should consider establishing a State demonstration program to evaluate alternatives to the existing 

civil litigation system with respect to the resolution of medical 

malpractice claims. 

TITLE VII—IMPROVING ACCESS TO 

INNOVATIVE MEDICAL THERAPIES 

Subtitle A—Biologics Price Competition 

and Innovation 

SEC. 7001. SHORT TITLE. 

(a) IN GENERAL.—This subtitle may be cited as the ‘‘Biologics 

Price Competition and Innovation Act of 2009’’. 

(b) SENSE OF THE SENATE.—It is the sense of the Senate that 

a biosimilars pathway balancing innovation and consumer interests 

should be established. 

SEC. 7002. APPROVAL PATHWAY FOR BIOSIMILAR BIOLOGICAL PRODUCTS. 

(a) LICENSURE OF BIOLOGICAL PRODUCTS AS BIOSIMILAR OR

INTERCHANGEABLE.—Section 351 of the Public Health Service Act 

(42 U.S.C. 262) is amended— 

(1) in subsection (a)(1)(A), by inserting ‘‘under this subsection or subsection (k)’’ after ‘‘biologics license’’; and 

(2) by adding at the end the following: 
H. R. 3590—687 

‘‘(k) LICENSURE OF BIOLOGICAL PRODUCTS AS BIOSIMILAR OR

INTERCHANGEABLE.— 

‘‘(1) IN GENERAL.—Any person may submit an application 

for licensure of a biological product under this subsection. 

‘‘(2) CONTENT.— 

‘‘(A) IN GENERAL.— 

‘‘(i) REQUIRED INFORMATION.—An application submitted under this subsection shall include information 

demonstrating that— 

‘‘(I) the biological product is biosimilar to a 

reference product based upon data derived from— 

‘‘(aa) analytical studies that demonstrate 

that the biological product is highly similar 

to the reference product notwithstanding 

minor differences in clinically inactive components; 

‘‘(bb) animal studies (including the assessment of toxicity); and 

‘‘(cc) a clinical study or studies (including 

the assessment of immunogenicity and 

pharmacokinetics or pharmacodynamics) that 

are sufficient to demonstrate safety, purity, 

and potency in 1 or more appropriate conditions of use for which the reference product 

is licensed and intended to be used and for 

which licensure is sought for the biological 

product; 

‘‘(II) the biological product and reference 

product utilize the same mechanism or mechanisms of action for the condition or conditions of 

use prescribed, recommended, or suggested in the 

proposed labeling, but only to the extent the 

mechanism or mechanisms of action are known 

for the reference product; 

‘‘(III) the condition or conditions of use prescribed, recommended, or suggested in the labeling 

proposed for the biological product have been previously approved for the reference product; 

‘‘(IV) the route of administration, the dosage 

form, and the strength of the biological product 

are the same as those of the reference product; 

and 

‘‘(V) the facility in which the biological product 

is manufactured, processed, packed, or held meets 

standards designed to assure that the biological 

product continues to be safe, pure, and potent. 

‘‘(ii) DETERMINATION BY SECRETARY.—The Secretary may determine, in the Secretary’s discretion, 

that an element described in clause (i)(I) is unnecessary 

in an application submitted under this subsection. 

‘‘(iii) ADDITIONAL INFORMATION.—An application 

submitted under this subsection— 

‘‘(I) shall include publicly-available information regarding the Secretary’s previous determination that the reference product is safe, pure, and 

potent; and 
H. R. 3590—688 

‘‘(II) may include any additional information 

in support of the application, including publiclyavailable information with respect to the reference 

product or another biological product. 

‘‘(B) INTERCHANGEABILITY.—An application (or a 

supplement to an application) submitted under this subsection may include information demonstrating that the 

biological product meets the standards described in paragraph (4). 

‘‘(3) EVALUATION BY SECRETARY.—Upon review of an 

application (or a supplement to an application) submitted under 

this subsection, the Secretary shall license the biological 

product under this subsection if— 

‘‘(A) the Secretary determines that the information submitted in the application (or the supplement) is sufficient 

to show that the biological product— 

‘‘(i) is biosimilar to the reference product; or 

‘‘(ii) meets the standards described in paragraph 

(4), and therefore is interchangeable with the reference 

product; and 

‘‘(B) the applicant (or other appropriate person) consents to the inspection of the facility that is the subject 

of the application, in accordance with subsection (c). 

‘‘(4) SAFETY STANDARDS FOR DETERMINING INTERCHANGEABILITY.—Upon review of an application submitted under this 

subsection or any supplement to such application, the Secretary 

shall determine the biological product to be interchangeable 

with the reference product if the Secretary determines that 

the information submitted in the application (or a supplement 

to such application) is sufficient to show that— 

‘‘(A) the biological product— 

‘‘(i) is biosimilar to the reference product; and 

‘‘(ii) can be expected to produce the same clinical 

result as the reference product in any given patient; 

and 

‘‘(B) for a biological product that is administered more 

than once to an individual, the risk in terms of safety 

or diminished efficacy of alternating or switching between 

use of the biological product and the reference product 

is not greater than the risk of using the reference product 

without such alternation or switch. 

‘‘(5) GENERAL RULES.— 

‘‘(A) ONE REFERENCE PRODUCT PER APPLICATION.—A 

biological product, in an application submitted under this 

subsection, may not be evaluated against more than 1 

reference product. 

‘‘(B) REVIEW.—An application submitted under this 

subsection shall be reviewed by the division within the 

Food and Drug Administration that is responsible for the 

review and approval of the application under which the 

reference product is licensed. 

‘‘(C) RISK EVALUATION AND MITIGATION STRATEGIES.— 

The authority of the Secretary with respect to risk evaluation and mitigation strategies under the Federal Food, 

Drug, and Cosmetic Act shall apply to biological products 

licensed under this subsection in the same manner as 
H. R. 3590—689 

such authority applies to biological products licensed under 

subsection (a). 

‘‘(6) EXCLUSIVITY FOR FIRST INTERCHANGEABLE BIOLOGICAL

PRODUCT.—Upon review of an application submitted under this 

subsection relying on the same reference product for which 

a prior biological product has received a determination of interchangeability for any condition of use, the Secretary shall not 

make a determination under paragraph (4) that the second 

or subsequent biological product is interchangeable for any 

condition of use until the earlier of— 

‘‘(A) 1 year after the first commercial marketing of 

the first interchangeable biosimilar biological product to 

be approved as interchangeable for that reference product; 

‘‘(B) 18 months after— 

‘‘(i) a final court decision on all patents in suit 

in an action instituted under subsection (l)(6) against 

the applicant that submitted the application for the 

first approved interchangeable biosimilar biological 

product; or 

‘‘(ii) the dismissal with or without prejudice of 

an action instituted under subsection (l)(6) against the 

applicant that submitted the application for the first 

approved interchangeable biosimilar biological product; 

or 

‘‘(C)(i) 42 months after approval of the first interchangeable biosimilar biological product if the applicant 

that submitted such application has been sued under subsection (l)(6) and such litigation is still ongoing within 

such 42-month period; or 

‘‘(ii) 18 months after approval of the first interchangeable biosimilar biological product if the applicant that submitted such application has not been sued under subsection 

(l)(6). 

For purposes of this paragraph, the term ‘final court decision’ 

means a final decision of a court from which no appeal (other 

than a petition to the United States Supreme Court for a 

writ of certiorari) has been or can be taken. 

‘‘(7) EXCLUSIVITY FOR REFERENCE PRODUCT.— ‘‘(A) EFFECTIVE DATE OF BIOSIMILAR APPLICATION

APPROVAL.—Approval of an application under this subsection may not be made effective by the Secretary until 

the date that is 12 years after the date on which the 

reference product was first licensed under subsection (a). 

‘‘(B) FILING PERIOD.—An application under this subsection may not be submitted to the Secretary until the 

date that is 4 years after the date on which the reference 

product was first licensed under subsection (a). 

‘‘(C) FIRST LICENSURE.—Subparagraphs (A) and (B) 

shall not apply to a license for or approval of— 

‘‘(i) a supplement for the biological product that 

is the reference product; or 

‘‘(ii) a subsequent application filed by the same 

sponsor or manufacturer of the biological product that 

is the reference product (or a licensor, predecessor 

in interest, or other related entity) for— 

‘‘(I) a change (not including a modification to 

the structure of the biological product) that results 
H. R. 3590—690 

in a new indication, route of administration, dosing 

schedule, dosage form, delivery system, delivery 

device, or strength; or 

‘‘(II) a modification to the structure of the 

biological product that does not result in a change 

in safety, purity, or potency. 

‘‘(8) GUIDANCE DOCUMENTS.— 

‘‘(A) IN GENERAL.—The Secretary may, after opportunity for public comment, issue guidance in accordance, 

except as provided in subparagraph (B)(i), with section 

701(h) of the Federal Food, Drug, and Cosmetic Act with 

respect to the licensure of a biological product under this 

subsection. Any such guidance may be general or specific. 

‘‘(B) PUBLIC COMMENT.— 

‘‘(i) IN GENERAL.—The Secretary shall provide the 

public an opportunity to comment on any proposed 

guidance issued under subparagraph (A) before issuing 

final guidance. 

‘‘(ii) INPUT REGARDING MOST VALUABLE GUIDANCE.—The Secretary shall establish a process through 

which the public may provide the Secretary with input 

regarding priorities for issuing guidance. 

‘‘(C) NO REQUIREMENT FOR APPLICATION CONSIDERATION.—The issuance (or non-issuance) of guidance under 

subparagraph (A) shall not preclude the review of, or action 

on, an application submitted under this subsection. 

‘‘(D) REQUIREMENT FOR PRODUCT CLASS-SPECIFIC GUID- ANCE.—If the Secretary issues product class-specific guidance under subparagraph (A), such guidance shall include 

a description of— 

‘‘(i) the criteria that the Secretary will use to determine whether a biological product is highly similar 

to a reference product in such product class; and 

‘‘(ii) the criteria, if available, that the Secretary 

will use to determine whether a biological product 

meets the standards described in paragraph (4). 

‘‘(E) CERTAIN PRODUCT CLASSES.— ‘‘(i) GUIDANCE.—The Secretary may indicate in a 

guidance document that the science and experience, 

as of the date of such guidance, with respect to a 

product or product class (not including any recombinant protein) does not allow approval of an application for a license as provided under this subsection 

for such product or product class. 

‘‘(ii) MODIFICATION OR REVERSAL.—The Secretary 

may issue a subsequent guidance document under 

subparagraph (A) to modify or reverse a guidance document under clause (i). 

‘‘(iii) NO EFFECT ON ABILITY TO DENY LICENSE.— Clause (i) shall not be construed to require the Secretary to approve a product with respect to which 

the Secretary has not indicated in a guidance document 

that the science and experience, as described in clause 

(i), does not allow approval of such an application. 

‘‘(l) PATENTS.— ‘‘(1) CONFIDENTIAL ACCESS TO SUBSECTION (k) APPLICA- TION.— 
H. R. 3590—691 

‘‘(A) APPLICATION OF PARAGRAPH.—Unless otherwise 

agreed to by a person that submits an application under 

subsection (k) (referred to in this subsection as the ‘subsection (k) applicant’) and the sponsor of the application 

for the reference product (referred to in this subsection 

as the ‘reference product sponsor’), the provisions of this 

paragraph shall apply to the exchange of information 

described in this subsection. 

‘‘(B) IN GENERAL.— 

‘‘(i) PROVISION OF CONFIDENTIAL INFORMATION.— When a subsection (k) applicant submits an application 

under subsection (k), such applicant shall provide to 

the persons described in clause (ii), subject to the terms 

of this paragraph, confidential access to the information required to be produced pursuant to paragraph 

(2) and any other information that the subsection (k) 

applicant determines, in its sole discretion, to be appropriate (referred to in this subsection as the ‘confidential 

information’). 

‘‘(ii) RECIPIENTS OF INFORMATION.—The persons 

described in this clause are the following: 

‘‘(I) OUTSIDE COUNSEL.—One or more attorneys 

designated by the reference product sponsor who 

are employees of an entity other than the reference 

product sponsor (referred to in this paragraph as 

the ‘outside counsel’), provided that such attorneys 

do not engage, formally or informally, in patent 

prosecution relevant or related to the reference 

product. 

‘‘(II) IN-HOUSE COUNSEL.—One attorney that 

represents the reference product sponsor who is 

an employee of the reference product sponsor, provided that such attorney does not engage, formally 

or informally, in patent prosecution relevant or 

related to the reference product. 

‘‘(iii) PATENT OWNER ACCESS.—A representative of 

the owner of a patent exclusively licensed to a reference 

product sponsor with respect to the reference product 

and who has retained a right to assert the patent 

or participate in litigation concerning the patent may 

be provided the confidential information, provided that 

the representative informs the reference product 

sponsor and the subsection (k) applicant of his or her 

agreement to be subject to the confidentiality provisions set forth in this paragraph, including those under 

clause (ii). 

‘‘(C) LIMITATION ON DISCLOSURE.—No person that 

receives confidential information pursuant to subparagraph 

(B) shall disclose any confidential information to any other 

person or entity, including the reference product sponsor 

employees, outside scientific consultants, or other outside 

counsel retained by the reference product sponsor, without 

the prior written consent of the subsection (k) applicant, 

which shall not be unreasonably withheld. 

‘‘(D) USE OF CONFIDENTIAL INFORMATION.—Confidential 

information shall be used for the sole and exclusive purpose 

of determining, with respect to each patent assigned to 
H. R. 3590—692 

or exclusively licensed by the reference product sponsor, 

whether a claim of patent infringement could reasonably 

be asserted if the subsection (k) applicant engaged in the 

manufacture, use, offering for sale, sale, or importation 

into the United States of the biological product that is 

the subject of the application under subsection (k). 

‘‘(E) OWNERSHIP OF CONFIDENTIAL INFORMATION.—The 

confidential information disclosed under this paragraph is, 

and shall remain, the property of the subsection (k) 

applicant. By providing the confidential information pursuant to this paragraph, the subsection (k) applicant does 

not provide the reference product sponsor or the outside 

counsel any interest in or license to use the confidential 

information, for purposes other than those specified in 

subparagraph (D). 

‘‘(F) EFFECT OF INFRINGEMENT ACTION.—In the event 

that the reference product sponsor files a patent infringement suit, the use of confidential information shall continue 

to be governed by the terms of this paragraph until such 

time as a court enters a protective order regarding the 

information. Upon entry of such order, the subsection (k) 

applicant may redesignate confidential information in 

accordance with the terms of that order. No confidential 

information shall be included in any publicly-available complaint or other pleading. In the event that the reference 

product sponsor does not file an infringement action by 

the date specified in paragraph (6), the reference product 

sponsor shall return or destroy all confidential information 

received under this paragraph, provided that if the reference product sponsor opts to destroy such information, 

it will confirm destruction in writing to the subsection 

(k) applicant. 

‘‘(G) RULE OF CONSTRUCTION.—Nothing in this paragraph shall be construed— 

‘‘(i) as an admission by the subsection (k) applicant 

regarding the validity, enforceability, or infringement 

of any patent; or 

‘‘(ii) as an agreement or admission by the subsection (k) applicant with respect to the competency, 

relevance, or materiality of any confidential information. 

‘‘(H) EFFECT OF VIOLATION.—The disclosure of any confidential information in violation of this paragraph shall 

be deemed to cause the subsection (k) applicant to suffer 

irreparable harm for which there is no adequate legal 

remedy and the court shall consider immediate injunctive 

relief to be an appropriate and necessary remedy for any 

violation or threatened violation of this paragraph. 

‘‘(2) SUBSECTION (k) APPLICATION INFORMATION.—Not later 

than 20 days after the Secretary notifies the subsection (k) 

applicant that the application has been accepted for review, 

the subsection (k) applicant— 

‘‘(A) shall provide to the reference product sponsor 

a copy of the application submitted to the Secretary under 

subsection (k), and such other information that describes 

the process or processes used to manufacture the biological 

product that is the subject of such application; and 
H. R. 3590—693 

‘‘(B) may provide to the reference product sponsor additional information requested by or on behalf of the reference 

product sponsor. 

‘‘(3) LIST AND DESCRIPTION OF PATENTS.— 

‘‘(A) LIST BY REFERENCE PRODUCT SPONSOR.—Not later 

than 60 days after the receipt of the application and 

information under paragraph (2), the reference product 

sponsor shall provide to the subsection (k) applicant— 

‘‘(i) a list of patents for which the reference product 

sponsor believes a claim of patent infringement could 

reasonably be asserted by the reference product 

sponsor, or by a patent owner that has granted an 

exclusive license to the reference product sponsor with 

respect to the reference product, if a person not licensed 

by the reference product sponsor engaged in the 

making, using, offering to sell, selling, or importing 

into the United States of the biological product that 

is the subject of the subsection (k) application; and 

‘‘(ii) an identification of the patents on such list 

that the reference product sponsor would be prepared 

to license to the subsection (k) applicant. 

‘‘(B) LIST AND DESCRIPTION BY SUBSECTION (k) 

APPLICANT.—Not later than 60 days after receipt of the 

list under subparagraph (A), the subsection (k) applicant— 

‘‘(i) may provide to the reference product sponsor 

a list of patents to which the subsection (k) applicant 

believes a claim of patent infringement could reasonably be asserted by the reference product sponsor if 

a person not licensed by the reference product sponsor 

engaged in the making, using, offering to sell, selling, 

or importing into the United States of the biological 

product that is the subject of the subsection (k) application; 

‘‘(ii) shall provide to the reference product sponsor, 

with respect to each patent listed by the reference 

product sponsor under subparagraph (A) or listed by 

the subsection (k) applicant under clause (i)— 

‘‘(I) a detailed statement that describes, on 

a claim by claim basis, the factual and legal basis 

of the opinion of the subsection (k) applicant that 

such patent is invalid, unenforceable, or will not 

be infringed by the commercial marketing of the 

biological product that is the subject of the subsection (k) application; or 

‘‘(II) a statement that the subsection (k) 

applicant does not intend to begin commercial marketing of the biological product before the date 

that such patent expires; and 

‘‘(iii) shall provide to the reference product sponsor 

a response regarding each patent identified by the 

reference product sponsor under subparagraph (A)(ii). 

‘‘(C) DESCRIPTION BY REFERENCE PRODUCT SPONSOR.— Not later than 60 days after receipt of the list and statement under subparagraph (B), the reference product 

sponsor shall provide to the subsection (k) applicant a 

detailed statement that describes, with respect to each 

patent described in subparagraph (B)(ii)(I), on a claim by 
H. R. 3590—694 

claim basis, the factual and legal basis of the opinion 

of the reference product sponsor that such patent will be 

infringed by the commercial marketing of the biological 

product that is the subject of the subsection (k) application 

and a response to the statement concerning validity and 

enforceability provided under subparagraph (B)(ii)(I). 

‘‘(4) PATENT RESOLUTION NEGOTIATIONS.— 

‘‘(A) IN GENERAL.—After receipt by the subsection (k) 

applicant of the statement under paragraph (3)(C), the 

reference product sponsor and the subsection (k) applicant 

shall engage in good faith negotiations to agree on which, 

if any, patents listed under paragraph (3) by the subsection 

(k) applicant or the reference product sponsor shall be 

the subject of an action for patent infringement under 

paragraph (6). 

‘‘(B) FAILURE TO REACH AGREEMENT.—If, within 15 days 

of beginning negotiations under subparagraph (A), the subsection (k) applicant and the reference product sponsor 

fail to agree on a final and complete list of which, if 

any, patents listed under paragraph (3) by the subsection 

(k) applicant or the reference product sponsor shall be 

the subject of an action for patent infringement under 

paragraph (6), the provisions of paragraph (5) shall apply 

to the parties. 

‘‘(5) PATENT RESOLUTION IF NO AGREEMENT.— ‘‘(A) NUMBER OF PATENTS.—The subsection (k) 

applicant shall notify the reference product sponsor of the 

number of patents that such applicant will provide to the 

reference product sponsor under subparagraph (B)(i)(I). 

‘‘(B) EXCHANGE OF PATENT LISTS.— ‘‘(i) IN GENERAL.—On a date agreed to by the subsection (k) applicant and the reference product sponsor, 

but in no case later than 5 days after the subsection 

(k) applicant notifies the reference product sponsor 

under subparagraph (A), the subsection (k) applicant 

and the reference product sponsor shall simultaneously 

exchange— 

‘‘(I) the list of patents that the subsection (k) 

applicant believes should be the subject of an 

action for patent infringement under paragraph 

(6); and 

‘‘(II) the list of patents, in accordance with 

clause (ii), that the reference product sponsor 

believes should be the subject of an action for 

patent infringement under paragraph (6). 

‘‘(ii) NUMBER OF PATENTS LISTED BY REFERENCE

PRODUCT SPONSOR.— ‘‘(I) IN GENERAL.—Subject to subclause (II), 

the number of patents listed by the reference 

product sponsor under clause (i)(II) may not exceed 

the number of patents listed by the subsection 

(k) applicant under clause (i)(I). 

‘‘(II) EXCEPTION.—If a subsection (k) applicant 

does not list any patent under clause (i)(I), the 

reference product sponsor may list 1 patent under 

clause (i)(II). 

‘‘(6) IMMEDIATE PATENT INFRINGEMENT ACTION.— 
H. R. 3590—695 

‘‘(A) ACTION IF AGREEMENT ON PATENT LIST.—If the 

subsection (k) applicant and the reference product sponsor 

agree on patents as described in paragraph (4), not later 

than 30 days after such agreement, the reference product 

sponsor shall bring an action for patent infringement with 

respect to each such patent. 

‘‘(B) ACTION IF NO AGREEMENT ON PATENT LIST.—If 

the provisions of paragraph (5) apply to the parties as 

described in paragraph (4)(B), not later than 30 days after 

the exchange of lists under paragraph (5)(B), the reference 

product sponsor shall bring an action for patent infringement with respect to each patent that is included on such 

lists. 

‘‘(C) NOTIFICATION AND PUBLICATION OF COMPLAINT.— 

‘‘(i) NOTIFICATION TO SECRETARY.—Not later than 

30 days after a complaint is served to a subsection 

(k) applicant in an action for patent infringement 

described under this paragraph, the subsection (k) 

applicant shall provide the Secretary with notice and 

a copy of such complaint. 

‘‘(ii) PUBLICATION BY SECRETARY.—The Secretary 

shall publish in the Federal Register notice of a complaint received under clause (i). 

‘‘(7) NEWLY ISSUED OR LICENSED PATENTS.—In the case 

of a patent that— 

‘‘(A) is issued to, or exclusively licensed by, the reference product sponsor after the date that the reference 

product sponsor provided the list to the subsection (k) 

applicant under paragraph (3)(A); and 

‘‘(B) the reference product sponsor reasonably believes 

that, due to the issuance of such patent, a claim of patent 

infringement could reasonably be asserted by the reference 

product sponsor if a person not licensed by the reference 

product sponsor engaged in the making, using, offering 

to sell, selling, or importing into the United States of 

the biological product that is the subject of the subsection 

(k) application, 

not later than 30 days after such issuance or licensing, the 

reference product sponsor shall provide to the subsection (k) 

applicant a supplement to the list provided by the reference 

product sponsor under paragraph (3)(A) that includes such 

patent, not later than 30 days after such supplement is provided, the subsection (k) applicant shall provide a statement 

to the reference product sponsor in accordance with paragraph 

(3)(B), and such patent shall be subject to paragraph (8). 

‘‘(8) NOTICE OF COMMERCIAL MARKETING AND PRELIMINARY

INJUNCTION.— ‘‘(A) NOTICE OF COMMERCIAL MARKETING.—The subsection (k) applicant shall provide notice to the reference 

product sponsor not later than 180 days before the date 

of the first commercial marketing of the biological product 

licensed under subsection (k). 

‘‘(B) PRELIMINARY INJUNCTION.—After receiving the 

notice under subparagraph (A) and before such date of 

the first commercial marketing of such biological product, 

the reference product sponsor may seek a preliminary 

injunction prohibiting the subsection (k) applicant from 
H. R. 3590—696 

engaging in the commercial manufacture or sale of such 

biological product until the court decides the issue of patent 

validity, enforcement, and infringement with respect to 

any patent that is— 

‘‘(i) included in the list provided by the reference 

product sponsor under paragraph (3)(A) or in the list 

provided by the subsection (k) applicant under paragraph (3)(B); and 

‘‘(ii) not included, as applicable, on— 

‘‘(I) the list of patents described in paragraph 

(4); or 

‘‘(II) the lists of patents described in paragraph 

(5)(B). 

‘‘(C) REASONABLE COOPERATION.—If the reference 

product sponsor has sought a preliminary injunction under 

subparagraph (B), the reference product sponsor and the 

subsection (k) applicant shall reasonably cooperate to expedite such further discovery as is needed in connection with 

the preliminary injunction motion. 

‘‘(9) LIMITATION ON DECLARATORY JUDGMENT ACTION.— 

‘‘(A) SUBSECTION (k) APPLICATION PROVIDED.—If a subsection (k) applicant provides the application and information required under paragraph (2)(A), neither the reference 

product sponsor nor the subsection (k) applicant may, prior 

to the date notice is received under paragraph (8)(A), bring 

any action under section 2201 of title 28, United States 

Code, for a declaration of infringement, validity, or enforceability of any patent that is described in clauses (i) and 

(ii) of paragraph (8)(B). 

‘‘(B) SUBSEQUENT FAILURE TO ACT BY SUBSECTION (k) 

APPLICANT.—If a subsection (k) applicant fails to complete 

an action required of the subsection (k) applicant under 

paragraph (3)(B)(ii), paragraph (5), paragraph (6)(C)(i), 

paragraph (7), or paragraph (8)(A), the reference product 

sponsor, but not the subsection (k) applicant, may bring 

an action under section 2201 of title 28, United States 

Code, for a declaration of infringement, validity, or enforceability of any patent included in the list described in paragraph (3)(A), including as provided under paragraph (7). 

‘‘(C) SUBSECTION (k) APPLICATION NOT PROVIDED.—If 

a subsection (k) applicant fails to provide the application 

and information required under paragraph (2)(A), the reference product sponsor, but not the subsection (k) 

applicant, may bring an action under section 2201 of title 

28, United States Code, for a declaration of infringement, 

validity, or enforceability of any patent that claims the 

biological product or a use of the biological product.’’. 

(b) DEFINITIONS.—Section 351(i) of the Public Health Service 

Act (42 U.S.C. 262(i)) is amended— 

(1) by striking ‘‘In this section, the term ‘biological product’ 

means’’ and inserting the following: ‘‘In this section: 

‘‘(1) The term ‘biological product’ means’’; 

(2) in paragraph (1), as so designated, by inserting ‘‘protein 

(except any chemically synthesized polypeptide),’’ after ‘‘allergenic product,’’; and 

(3) by adding at the end the following: 
H. R. 3590—697 

‘‘(2) The term ‘biosimilar’ or ‘biosimilarity’, in reference 

to a biological product that is the subject of an application 

under subsection (k), means— 

‘‘(A) that the biological product is highly similar to 

the reference product notwithstanding minor differences 

in clinically inactive components; and 

‘‘(B) there are no clinically meaningful differences 

between the biological product and the reference product 

in terms of the safety, purity, and potency of the product. 

‘‘(3) The term ‘interchangeable’ or ‘interchangeability’, in 

reference to a biological product that is shown to meet the 

standards described in subsection (k)(4), means that the 

biological product may be substituted for the reference product 

without the intervention of the health care provider who prescribed the reference product. 

‘‘(4) The term ‘reference product’ means the single biological 

product licensed under subsection (a) against which a biological 

product is evaluated in an application submitted under subsection (k).’’. 

(c) CONFORMING AMENDMENTS RELATING TO PATENTS.— 

(1) PATENTS.—Section 271(e) of title 35, United States Code, 

is amended— 

(A) in paragraph (2)— 

(i) in subparagraph (A), by striking ‘‘or’’ at the 

end; 

(ii) in subparagraph (B), by adding ‘‘or’’ at the 

end; and 

(iii) by inserting after subparagraph (B) the following: 

‘‘(C)(i) with respect to a patent that is identified in the 

list of patents described in section 351(l)(3) of the Public Health 

Service Act (including as provided under section 351(l)(7) of 

such Act), an application seeking approval of a biological 

product, or 

‘‘(ii) if the applicant for the application fails to provide 

the application and information required under section 

351(l)(2)(A) of such Act, an application seeking approval of 

a biological product for a patent that could be identified pursuant to section 351(l)(3)(A)(i) of such Act,’’; and 

(iv) in the matter following subparagraph (C) (as 

added by clause (iii)), by striking ‘‘or veterinary 

biological product’’ and inserting ‘‘, veterinary biological 

product, or biological product’’; 

(B) in paragraph (4)— 

(i) in subparagraph (B), by— 

(I) striking ‘‘or veterinary biological product’’ 

and inserting ‘‘, veterinary biological product, or 

biological product’’; and 

(II) striking ‘‘and’’ at the end; 

(ii) in subparagraph (C), by— 

(I) striking ‘‘or veterinary biological product’’ 

and inserting ‘‘, veterinary biological product, or 

biological product’’; and 

(II) striking the period and inserting ‘‘, and’’; 

(iii) by inserting after subparagraph (C) the following: 
H. R. 3590—698 

‘‘(D) the court shall order a permanent injunction prohibiting any infringement of the patent by the biological product 

involved in the infringement until a date which is not earlier 

than the date of the expiration of the patent that has been 

infringed under paragraph (2)(C), provided the patent is the 

subject of a final court decision, as defined in section 351(k)(6) 

of the Public Health Service Act, in an action for infringement 

of the patent under section 351(l)(6) of such Act, and the 

biological product has not yet been approved because of section 

351(k)(7) of such Act.’’; and 

(iv) in the matter following subparagraph (D) (as 

added by clause (iii)), by striking ‘‘and (C)’’ and 

inserting ‘‘(C), and (D)’’; and 

(C) by adding at the end the following: 

‘‘(6)(A) Subparagraph (B) applies, in lieu of paragraph (4), in 

the case of a patent— 

‘‘(i) that is identified, as applicable, in the list of patents 

described in section 351(l)(4) of the Public Health Service Act 

or the lists of patents described in section 351(l)(5)(B) of such 

Act with respect to a biological product; and 

‘‘(ii) for which an action for infringement of the patent 

with respect to the biological product— 

‘‘(I) was brought after the expiration of the 30-day 

period described in subparagraph (A) or (B), as applicable, 

of section 351(l)(6) of such Act; or 

‘‘(II) was brought before the expiration of the 30-day 

period described in subclause (I), but which was dismissed 

without prejudice or was not prosecuted to judgment in 

good faith. 

‘‘(B) In an action for infringement of a patent described in 

subparagraph (A), the sole and exclusive remedy that may be 

granted by a court, upon a finding that the making, using, offering 

to sell, selling, or importation into the United States of the biological 

product that is the subject of the action infringed the patent, shall 

be a reasonable royalty. 

‘‘(C) The owner of a patent that should have been included 

in the list described in section 351(l)(3)(A) of the Public Health 

Service Act, including as provided under section 351(l)(7) of such 

Act for a biological product, but was not timely included in such 

list, may not bring an action under this section for infringement 

of the patent with respect to the biological product.’’. 

(2) CONFORMING AMENDMENT UNDER TITLE 28.—Section 

2201(b) of title 28, United States Code, is amended by inserting 

before the period the following: ‘‘, or section 351 of the Public 

Health Service Act’’. 

(d) CONFORMING AMENDMENTS UNDER THE FEDERAL FOOD, DRUG, AND COSMETIC ACT.— (1) CONTENT AND REVIEW OF APPLICATIONS.—Section 

505(b)(5)(B) of the Federal Food, Drug, and Cosmetic Act (21 

U.S.C. 355(b)(5)(B)) is amended by inserting before the period 

at the end of the first sentence the following: ‘‘or, with respect 

to an applicant for approval of a biological product under section 

351(k) of the Public Health Service Act, any necessary clinical 

study or studies’’. 

(2) NEW ACTIVE INGREDIENT.—Section 505B of the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 355c) is amended 

by adding at the end the following: 
H. R. 3590—699 

‘‘(n) NEW ACTIVE INGREDIENT.— 

‘‘(1) NON-INTERCHANGEABLE BIOSIMILAR BIOLOGICAL

PRODUCT.—A biological product that is biosimilar to a reference 

product under section 351 of the Public Health Service Act, 

and that the Secretary has not determined to meet the standards described in subsection (k)(4) of such section for interchangeability with the reference product, shall be considered 

to have a new active ingredient under this section. 

‘‘(2) INTERCHANGEABLE BIOSIMILAR BIOLOGICAL PRODUCT.— 

A biological product that is interchangeable with a reference 

product under section 351 of the Public Health Service Act 

shall not be considered to have a new active ingredient under 

this section.’’. 

(e) PRODUCTS PREVIOUSLY APPROVED UNDER SECTION 505.— 

(1) REQUIREMENT TO FOLLOW SECTION 351.—Except as provided in paragraph (2), an application for a biological product 

shall be submitted under section 351 of the Public Health 

Service Act (42 U.S.C. 262) (as amended by this Act). 

(2) EXCEPTION.—An application for a biological product may 

be submitted under section 505 of the Federal Food, Drug, 

and Cosmetic Act (21 U.S.C. 355) if— 

(A) such biological product is in a product class for 

which a biological product in such product class is the 

subject of an application approved under such section 505 

not later than the date of enactment of this Act; and 

(B) such application— 

(i) has been submitted to the Secretary of Health 

and Human Services (referred to in this subtitle as 

the ‘‘Secretary’’) before the date of enactment of this 

Act; or 

(ii) is submitted to the Secretary not later than 

the date that is 10 years after the date of enactment 

of this Act. 

(3) LIMITATION.—Notwithstanding paragraph (2), an 

application for a biological product may not be submitted under 

section 505 of the Federal Food, Drug, and Cosmetic Act (21 

U.S.C. 355) if there is another biological product approved 

under subsection (a) of section 351 of the Public Health Service 

Act that could be a reference product with respect to such 

application (within the meaning of such section 351) if such 

application were submitted under subsection (k) of such section 

351. 

(4) DEEMED APPROVED UNDER SECTION 351.—An approved 

application for a biological product under section 505 of the 

Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) shall 

be deemed to be a license for the biological product under 

such section 351 on the date that is 10 years after the date 

of enactment of this Act. 

(5) DEFINITIONS.—For purposes of this subsection, the term 

‘‘biological product’’ has the meaning given such term under 

section 351 of the Public Health Service Act (42 U.S.C. 262) 

(as amended by this Act). 

(f) FOLLOW-ON BIOLOGICS USER FEES.— 

(1) DEVELOPMENT OF USER FEES FOR BIOSIMILAR BIOLOGICAL

PRODUCTS.— 

(A) IN GENERAL.—Beginning not later than October 

1, 2010, the Secretary shall develop recommendations to 
H. R. 3590—700 

present to Congress with respect to the goals, and plans 

for meeting the goals, for the process for the review of 

biosimilar biological product applications submitted under 

section 351(k) of the Public Health Service Act (as added 

by this Act) for the first 5 fiscal years after fiscal year 

2012. In developing such recommendations, the Secretary 

shall consult with— 

(i) the Committee on Health, Education, Labor, 

and Pensions of the Senate; 

(ii) the Committee on Energy and Commerce of 

the House of Representatives; 

(iii) scientific and academic experts; 

(iv) health care professionals; 

(v) representatives of patient and consumer 

advocacy groups; and 

(vi) the regulated industry. 

(B) PUBLIC REVIEW OF RECOMMENDATIONS.—After negotiations with the regulated industry, the Secretary shall— 

(i) present the recommendations developed under 

subparagraph (A) to the Congressional committees 

specified in such subparagraph; 

(ii) publish such recommendations in the Federal 

Register; 

(iii) provide for a period of 30 days for the public 

to provide written comments on such recommendations; 

(iv) hold a meeting at which the public may present 

its views on such recommendations; and 

(v) after consideration of such public views and 

comments, revise such recommendations as necessary. 

(C) TRANSMITTAL OF RECOMMENDATIONS.—Not later 

than January 15, 2012, the Secretary shall transmit to 

Congress the revised recommendations under subparagraph (B), a summary of the views and comments received 

under such subparagraph, and any changes made to the 

recommendations in response to such views and comments. 

(2) ESTABLISHMENT OF USER FEE PROGRAM.—It is the sense 

of the Senate that, based on the recommendations transmitted 

to Congress by the Secretary pursuant to paragraph (1)(C), 

Congress should authorize a program, effective on October 1, 

2012, for the collection of user fees relating to the submission 

of biosimilar biological product applications under section 

351(k) of the Public Health Service Act (as added by this 

Act). 

(3) TRANSITIONAL PROVISIONS FOR USER FEES FOR BIOSIMILAR BIOLOGICAL PRODUCTS.— 

(A) APPLICATION OF THE PRESCRIPTION DRUG USER FEE

PROVISIONS.—Section 735(1)(B) of the Federal Food, Drug, 

and Cosmetic Act (21 U.S.C. 379g(1)(B)) is amended by 

striking ‘‘section 351’’ and inserting ‘‘subsection (a) or (k) 

of section 351’’. 

(B) EVALUATION OF COSTS OF REVIEWING BIOSIMILAR

BIOLOGICAL PRODUCT APPLICATIONS.—During the period 

beginning on the date of enactment of this Act and ending 

on October 1, 2010, the Secretary shall collect and evaluate 

data regarding the costs of reviewing applications for 

biological products submitted under section 351(k) of the 
H. R. 3590—701 

Public Health Service Act (as added by this Act) during 

such period. 

(C) AUDIT.— 

(i) IN GENERAL.—On the date that is 2 years after 

first receiving a user fee applicable to an application 

for a biological product under section 351(k) of the 

Public Health Service Act (as added by this Act), and 

on a biennial basis thereafter until October 1, 2013, 

the Secretary shall perform an audit of the costs of 

reviewing such applications under such section 351(k). 

Such an audit shall compare— 

(I) the costs of reviewing such applications 

under such section 351(k) to the amount of the 

user fee applicable to such applications; and 

(II)(aa) such ratio determined under subclause 

(I); to 

(bb) the ratio of the costs of reviewing applications for biological products under section 351(a) 

of such Act (as amended by this Act) to the amount 

of the user fee applicable to such applications 

under such section 351(a). 

(ii) ALTERATION OF USER FEE.—If the audit performed under clause (i) indicates that the ratios compared under subclause (II) of such clause differ by 

more than 5 percent, then the Secretary shall alter 

the user fee applicable to applications submitted under 

such section 351(k) to more appropriately account for 

the costs of reviewing such applications. 

(iii) ACCOUNTING STANDARDS.—The Secretary shall 

perform an audit under clause (i) in conformance with 

the accounting principles, standards, and requirements 

prescribed by the Comptroller General of the United 

States under section 3511 of title 31, United State 

Code, to ensure the validity of any potential variability. 

(4) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection such sums 

as may be necessary for each of fiscal years 2010 through 

2012. 

(g) PEDIATRIC STUDIES OF BIOLOGICAL PRODUCTS.— 

(1) IN GENERAL.—Section 351 of the Public Health Service 

Act (42 U.S.C. 262) is amended by adding at the end the 

following: 

‘‘(m) PEDIATRIC STUDIES.— 

‘‘(1) APPLICATION OF CERTAIN PROVISIONS.—The provisions 

of subsections (a), (d), (e), (f), (i), (j), (k), (l), (p), and (q) of 

section 505A of the Federal Food, Drug, and Cosmetic Act 

shall apply with respect to the extension of a period under 

paragraphs (2) and (3) to the same extent and in the same 

manner as such provisions apply with respect to the extension 

of a period under subsection (b) or (c) of section 505A of the 

Federal Food, Drug, and Cosmetic Act. 

‘‘(2) MARKET EXCLUSIVITY FOR NEW BIOLOGICAL PRODUCTS.—If, prior to approval of an application that is submitted 

under subsection (a), the Secretary determines that information 

relating to the use of a new biological product in the pediatric 

population may produce health benefits in that population, 

the Secretary makes a written request for pediatric studies 
H. R. 3590—702 

(which shall include a timeframe for completing such studies), 

the applicant agrees to the request, such studies are completed 

using appropriate formulations for each age group for which 

the study is requested within any such timeframe, and the 

reports thereof are submitted and accepted in accordance with 

section 505A(d)(3) of the Federal Food, Drug, and Cosmetic 

Act— 

‘‘(A) the periods for such biological product referred 

to in subsection (k)(7) are deemed to be 4 years and 6 

months rather than 4 years and 12 years and 6 months 

rather than 12 years; and 

‘‘(B) if the biological product is designated under section 

526 for a rare disease or condition, the period for such 

biological product referred to in section 527(a) is deemed 

to be 7 years and 6 months rather than 7 years. 

‘‘(3) MARKET EXCLUSIVITY FOR ALREADY-MARKETED

BIOLOGICAL PRODUCTS.—If the Secretary determines that 

information relating to the use of a licensed biological product 

in the pediatric population may produce health benefits in 

that population and makes a written request to the holder 

of an approved application under subsection (a) for pediatric 

studies (which shall include a timeframe for completing such 

studies), the holder agrees to the request, such studies are 

completed using appropriate formulations for each age group 

for which the study is requested within any such timeframe, 

and the reports thereof are submitted and accepted in accordance with section 505A(d)(3) of the Federal Food, Drug, and 

Cosmetic Act— 

‘‘(A) the periods for such biological product referred 

to in subsection (k)(7) are deemed to be 4 years and 6 

months rather than 4 years and 12 years and 6 months 

rather than 12 years; and 

‘‘(B) if the biological product is designated under section 

526 for a rare disease or condition, the period for such 

biological product referred to in section 527(a) is deemed 

to be 7 years and 6 months rather than 7 years. 

‘‘(4) EXCEPTION.—The Secretary shall not extend a period 

referred to in paragraph (2)(A), (2)(B), (3)(A), or (3)(B) if the 

determination under section 505A(d)(3) is made later than 9 

months prior to the expiration of such period.’’. 

(2) STUDIES REGARDING PEDIATRIC RESEARCH.— 

(A) PROGRAM FOR PEDIATRIC STUDY OF DRUGS.—Subsection (a)(1) of section 409I of the Public Health Service 

Act (42 U.S.C. 284m) is amended by inserting ‘‘, biological 

products,’’ after ‘‘including drugs’’. 

(B) INSTITUTE OF MEDICINE STUDY.—Section 505A(p) 

of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 

355b(p)) is amended by striking paragraphs (4) and (5) 

and inserting the following: 

‘‘(4) review and assess the number and importance of 

biological products for children that are being tested as a result 

of the amendments made by the Biologics Price Competition 

and Innovation Act of 2009 and the importance for children, 

health care providers, parents, and others of labeling changes 

made as a result of such testing; 
H. R. 3590—703 

‘‘(5) review and assess the number, importance, and 

prioritization of any biological products that are not being tested 

for pediatric use; and 

‘‘(6) offer recommendations for ensuring pediatric testing 

of biological products, including consideration of any incentives, 

such as those provided under this section or section 351(m) 

of the Public Health Service Act.’’. 

(h) ORPHAN PRODUCTS.—If a reference product, as defined in 

section 351 of the Public Health Service Act (42 U.S.C. 262) (as 

amended by this Act) has been designated under section 526 of 

the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360bb) for 

a rare disease or condition, a biological product seeking approval 

for such disease or condition under subsection (k) of such section 

351 as biosimilar to, or interchangeable with, such reference product 

may be licensed by the Secretary only after the expiration for 

such reference product of the later of— 

(1) the 7-year period described in section 527(a) of the 

Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360cc(a)); 

and 

(2) the 12-year period described in subsection (k)(7) of 

such section 351. 

SEC. 7003. SAVINGS. 

(a) DETERMINATION.—The Secretary of the Treasury, in consultation with the Secretary of Health and Human Services, shall 

for each fiscal year determine the amount of savings to the Federal 

Government as a result of the enactment of this subtitle. 

(b) USE.—Notwithstanding any other provision of this subtitle 

(or an amendment made by this subtitle), the savings to the Federal 

Government generated as a result of the enactment of this subtitle 

shall be used for deficit reduction. 

Subtitle B—More Affordable Medicines for 

Children and Underserved Communities 

SEC. 7101. EXPANDED PARTICIPATION IN 340B PROGRAM. 

(a) EXPANSION OF COVERED ENTITIES RECEIVING DISCOUNTED

PRICES.—Section 340B(a)(4) of the Public Health Service Act (42 

U.S.C. 256b(a)(4)) is amended by adding at the end the following: 

‘‘(M) A children’s hospital excluded from the Medicare 

prospective payment system pursuant to section 

1886(d)(1)(B)(iii) of the Social Security Act, or a freestanding cancer hospital excluded from the Medicare 

prospective payment system pursuant to section 

1886(d)(1)(B)(v) of the Social Security Act, that would meet 

the requirements of subparagraph (L), including the disproportionate share adjustment percentage requirement 

under clause (ii) of such subparagraph, if the hospital were 

a subsection (d) hospital as defined by section 1886(d)(1)(B) 

of the Social Security Act. 

‘‘(N) An entity that is a critical access hospital (as 

determined under section 1820(c)(2) of the Social Security 

Act), and that meets the requirements of subparagraph 

(L)(i). 

‘‘(O) An entity that is a rural referral center, as defined 

by section 1886(d)(5)(C)(i) of the Social Security Act, or 
H. R. 3590—704 

a sole community hospital, as defined by section 

1886(d)(5)(C)(iii) of such Act, and that both meets the 

requirements of subparagraph (L)(i) and has a disproportionate share adjustment percentage equal to or greater 

than 8 percent.’’. 

(b) EXTENSION OF DISCOUNT TO INPATIENT DRUGS.—Section 

340B of the Public Health Service Act (42 U.S.C. 256b) is amended— 

(1) in paragraphs (2), (5), (7), and (9) of subsection (a), 

by striking ‘‘outpatient’’ each place it appears; and 

(2) in subsection (b)— 

(A) by striking ‘‘OTHER DEFINITION’’ and all that follows 

through ‘‘In this section’’ and inserting the following: 

‘‘OTHER DEFINITIONS.— 

‘‘(1) IN GENERAL.—In this section’’; and 

(B) by adding at the end the following new paragraph: 

‘‘(2) COVERED DRUG.—In this section, the term ‘covered 

drug’— 

‘‘(A) means a covered outpatient drug (as defined in 

section 1927(k)(2) of the Social Security Act); and 

‘‘(B) includes, notwithstanding paragraph (3)(A) of section 1927(k) of such Act, a drug used in connection with 

an inpatient or outpatient service provided by a hospital 

described in subparagraph (L), (M), (N), or (O) of subsection 

(a)(4) that is enrolled to participate in the drug discount 

program under this section.’’. 

(c) PROHIBITION ON GROUP PURCHASING ARRANGEMENTS.—Section 340B(a) of the Public Health Service Act (42 U.S.C. 256b(a)) 

is amended— 

(1) in paragraph (4)(L)— 

(A) in clause (i), by adding ‘‘and’’ at the end; 

(B) in clause (ii), by striking ‘‘; and’’ and inserting 

a period; and 

(C) by striking clause (iii); and 

(2) in paragraph (5), as amended by subsection (b)— 

(A) by redesignating subparagraphs (C) and (D) as 

subparagraphs (D) and (E); respectively; and 

(B) by inserting after subparagraph (B), the following: 

‘‘(C) PROHIBITION ON GROUP PURCHASING ARRANGEMENTS.— 

‘‘(i) IN GENERAL.—A hospital described in subparagraph (L), (M), (N), or (O) of paragraph (4) shall not 

obtain covered outpatient drugs through a group purchasing organization or other group purchasing 

arrangement, except as permitted or provided for 

pursuant to clauses (ii) or (iii). 

‘‘(ii) INPATIENT DRUGS.—Clause (i) shall not apply 

to drugs purchased for inpatient use. 

‘‘(iii) EXCEPTIONS.—The Secretary shall establish 

reasonable exceptions to clause (i)— 

‘‘(I) with respect to a covered outpatient drug 

that is unavailable to be purchased through the 

program under this section due to a drug shortage 

problem, manufacturer noncompliance, or any 

other circumstance beyond the hospital’s control; 

‘‘(II) to facilitate generic substitution when a 

generic covered outpatient drug is available at a 

lower price; or 
H. R. 3590—705 

‘‘(III) to reduce in other ways the administrative burdens of managing both inventories of drugs 

subject to this section and inventories of drugs 

that are not subject to this section, so long as 

the exceptions do not create a duplicate discount 

problem in violation of subparagraph (A) or a 

diversion problem in violation of subparagraph (B). 

‘‘(iv) PURCHASING ARRANGEMENTS FOR INPATIENT

DRUGS.—The Secretary shall ensure that a hospital 

described in subparagraph (L), (M), (N), or (O) of subsection (a)(4) that is enrolled to participate in the drug 

discount program under this section shall have multiple options for purchasing covered drugs for 

inpatients, including by utilizing a group purchasing 

organization or other group purchasing arrangement, 

establishing and utilizing its own group purchasing 

program, purchasing directly from a manufacturer, and 

any other purchasing arrangements that the Secretary 

determines is appropriate to ensure access to drug 

discount pricing under this section for inpatient drugs 

taking into account the particular needs of small and 

rural hospitals.’’. 

(d) MEDICAID CREDITS ON INPATIENT DRUGS.—Section 340B 

of the Public Health Service Act (42 U.S.C. 256b) is amended 

by striking subsection (c) and inserting the following: 

‘‘(c) MEDICAID CREDIT.—Not later than 90 days after the date 

of filing of the hospital’s most recently filed Medicare cost report, 

the hospital shall issue a credit as determined by the Secretary 

to the State Medicaid program for inpatient covered drugs provided 

to Medicaid recipients.’’. 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—The amendments made by this section 

and section 7102 shall take effect on January 1, 2010, and 

shall apply to drugs purchased on or after January 1, 2010. 

(2) EFFECTIVENESS.—The amendments made by this section 

and section 7102 shall be effective and shall be taken into 

account in determining whether a manufacturer is deemed 

to meet the requirements of section 340B(a) of the Public Health 

Service Act (42 U.S.C. 256b(a)), notwithstanding any other 

provision of law. 

SEC. 7102. IMPROVEMENTS TO 340B PROGRAM INTEGRITY. 

(a) INTEGRITY IMPROVEMENTS.—Subsection (d) of section 340B 

of the Public Health Service Act (42 U.S.C. 256b) is amended 

to read as follows: 

‘‘(d) IMPROVEMENTS IN PROGRAM INTEGRITY.— 

‘‘(1) MANUFACTURER COMPLIANCE.— 

‘‘(A) IN GENERAL.—From amounts appropriated under 

paragraph (4), the Secretary shall provide for improvements in compliance by manufacturers with the requirements of this section in order to prevent overcharges and 

other violations of the discounted pricing requirements 

specified in this section. 

‘‘(B) IMPROVEMENTS.—The improvements described in 

subparagraph (A) shall include the following: 
H. R. 3590—706 

‘‘(i) The development of a system to enable the 

Secretary to verify the accuracy of ceiling prices calculated by manufacturers under subsection (a)(1) and 

charged to covered entities, which shall include the 

following: 

‘‘(I) Developing and publishing through an 

appropriate policy or regulatory issuance, precisely 

defined standards and methodology for the calculation of ceiling prices under such subsection. 

‘‘(II) Comparing regularly the ceiling prices 

calculated by the Secretary with the quarterly 

pricing data that is reported by manufacturers 

to the Secretary. 

‘‘(III) Performing spot checks of sales transactions by covered entities. 

‘‘(IV) Inquiring into the cause of any pricing 

discrepancies that may be identified and either 

taking, or requiring manufacturers to take, such 

corrective action as is appropriate in response to 

such price discrepancies. 

‘‘(ii) The establishment of procedures for manufacturers to issue refunds to covered entities in the event 

that there is an overcharge by the manufacturers, 

including the following: 

‘‘(I) Providing the Secretary with an explanation of why and how the overcharge occurred, 

how the refunds will be calculated, and to whom 

the refunds will be issued. 

‘‘(II) Oversight by the Secretary to ensure that 

the refunds are issued accurately and within a 

reasonable period of time, both in routine instances 

of retroactive adjustment to relevant pricing data 

and exceptional circumstances such as erroneous 

or intentional overcharging for covered drugs. 

‘‘(iii) The provision of access through the Internet 

website of the Department of Health and Human Services to the applicable ceiling prices for covered drugs 

as calculated and verified by the Secretary in accordance with this section, in a manner (such as through 

the use of password protection) that limits such access 

to covered entities and adequately assures security 

and protection of privileged pricing data from 

unauthorized re-disclosure. 

‘‘(iv) The development of a mechanism by which— 

‘‘(I) rebates and other discounts provided by 

manufacturers to other purchasers subsequent to 

the sale of covered drugs to covered entities are 

reported to the Secretary; and 

‘‘(II) appropriate credits and refunds are issued 

to covered entities if such discounts or rebates 

have the effect of lowering the applicable ceiling 

price for the relevant quarter for the drugs 

involved. 

‘‘(v) Selective auditing of manufacturers and wholesalers to ensure the integrity of the drug discount 

program under this section. 
H. R. 3590—707 

‘‘(vi) The imposition of sanctions in the form of 

civil monetary penalties, which— 

‘‘(I) shall be assessed according to standards 

established in regulations to be promulgated by 

the Secretary not later than 180 days after the 

date of enactment of the Patient Protection and 

Affordable Care Act; 

‘‘(II) shall not exceed $5,000 for each instance 

of overcharging a covered entity that may have 

occurred; and 

‘‘(III) shall apply to any manufacturer with 

an agreement under this section that knowingly 

and intentionally charges a covered entity a price 

for purchase of a drug that exceeds the maximum 

applicable price under subsection (a)(1). 

‘‘(2) COVERED ENTITY COMPLIANCE.— 

‘‘(A) IN GENERAL.—From amounts appropriated under 

paragraph (4), the Secretary shall provide for improvements in compliance by covered entities with the requirements of this section in order to prevent diversion and 

violations of the duplicate discount provision and other 

requirements specified under subsection (a)(5). 

‘‘(B) IMPROVEMENTS.—The improvements described in 

subparagraph (A) shall include the following: 

‘‘(i) The development of procedures to enable and 

require covered entities to regularly update (at least 

annually) the information on the Internet website of 

the Department of Health and Human Services 

relating to this section. 

‘‘(ii) The development of a system for the Secretary 

to verify the accuracy of information regarding covered 

entities that is listed on the website described in clause 

(i). 

‘‘(iii) The development of more detailed guidance 

describing methodologies and options available to covered entities for billing covered drugs to State Medicaid 

agencies in a manner that avoids duplicate discounts 

pursuant to subsection (a)(5)(A). 

‘‘(iv) The establishment of a single, universal, and 

standardized identification system by which each covered entity site can be identified by manufacturers, 

distributors, covered entities, and the Secretary for 

purposes of facilitating the ordering, purchasing, and 

delivery of covered drugs under this section, including 

the processing of chargebacks for such drugs. 

‘‘(v) The imposition of sanctions, in appropriate 

cases as determined by the Secretary, additional to 

those to which covered entities are subject under subsection (a)(5)(E), through one or more of the following 

actions: 

‘‘(I) Where a covered entity knowingly and 

intentionally violates subsection (a)(5)(B), the covered entity shall be required to pay a monetary 

penalty to a manufacturer or manufacturers in 

the form of interest on sums for which the covered 

entity is found liable under subsection (a)(5)(E), 

such interest to be compounded monthly and equal 
H. R. 3590—708 

to the current short term interest rate as determined by the Federal Reserve for the time period 

for which the covered entity is liable. 

‘‘(II) Where the Secretary determines a violation of subsection (a)(5)(B) was systematic and 

egregious as well as knowing and intentional, 

removing the covered entity from the drug discount 

program under this section and disqualifying the 

entity from re-entry into such program for a 

reasonable period of time to be determined by the 

Secretary. 

‘‘(III) Referring matters to appropriate Federal 

authorities within the Food and Drug Administration, the Office of Inspector General of Department 

of Health and Human Services, or other Federal 

agencies for consideration of appropriate action 

under other Federal statutes, such as the Prescription Drug Marketing Act (21 U.S.C. 353). 

‘‘(3) ADMINISTRATIVE DISPUTE RESOLUTION PROCESS.— 

‘‘(A) IN GENERAL.—Not later than 180 days after the 

date of enactment of the Patient Protection and Affordable 

Care Act, the Secretary shall promulgate regulations to 

establish and implement an administrative process for the 

resolution of claims by covered entities that they have 

been overcharged for drugs purchased under this section, 

and claims by manufacturers, after the conduct of audits 

as authorized by subsection (a)(5)(D), of violations of subsections (a)(5)(A) or (a)(5)(B), including appropriate procedures for the provision of remedies and enforcement of 

determinations made pursuant to such process through 

mechanisms and sanctions described in paragraphs (1)(B) 

and (2)(B). 

‘‘(B) DEADLINES AND PROCEDURES.—Regulations 

promulgated by the Secretary under subparagraph (A) 

shall— 

‘‘(i) designate or establish a decision-making official or decision-making body within the Department 

of Health and Human Services to be responsible for 

reviewing and finally resolving claims by covered entities that they have been charged prices for covered 

drugs in excess of the ceiling price described in subsection (a)(1), and claims by manufacturers that violations of subsection (a)(5)(A) or (a)(5)(B) have occurred; 

‘‘(ii) establish such deadlines and procedures as 

may be necessary to ensure that claims shall be 

resolved fairly, efficiently, and expeditiously; 

‘‘(iii) establish procedures by which a covered 

entity may discover and obtain such information and 

documents from manufacturers and third parties as 

may be relevant to demonstrate the merits of a claim 

that charges for a manufacturer’s product have 

exceeded the applicable ceiling price under this section, 

and may submit such documents and information to 

the administrative official or body responsible for adjudicating such claim; 

‘‘(iv) require that a manufacturer conduct an audit 

of a covered entity pursuant to subsection (a)(5)(D) 
H. R. 3590—709 

as a prerequisite to initiating administrative dispute 

resolution proceedings against a covered entity; 

‘‘(v) permit the official or body designated under 

clause (i), at the request of a manufacturer or manufacturers, to consolidate claims brought by more than 

one manufacturer against the same covered entity 

where, in the judgment of such official or body, consolidation is appropriate and consistent with the goals 

of fairness and economy of resources; and 

‘‘(vi) include provisions and procedures to permit 

multiple covered entities to jointly assert claims of 

overcharges by the same manufacturer for the same 

drug or drugs in one administrative proceeding, and 

permit such claims to be asserted on behalf of covered 

entities by associations or organizations representing 

the interests of such covered entities and of which 

the covered entities are members. 

‘‘(C) FINALITY OF ADMINISTRATIVE RESOLUTION.—The 

administrative resolution of a claim or claims under the 

regulations promulgated under subparagraph (A) shall be 

a final agency decision and shall be binding upon the 

parties involved, unless invalidated by an order of a court 

of competent jurisdiction. 

‘‘(4) AUTHORIZATION OF APPROPRIATIONS.—There are 

authorized to be appropriated to carry out this subsection, 

such sums as may be necessary for fiscal year 2010 and each 

succeeding fiscal year.’’. 

(b) CONFORMING AMENDMENTS.—Section 340B(a) of the Public 

Health Service Act (42 U.S.C. 256b(a)) is amended— 

(1) in subsection (a)(1), by adding at the end the following: 

‘‘Each such agreement shall require that the manufacturer 

furnish the Secretary with reports, on a quarterly basis, of 

the price for each covered drug subject to the agreement that, 

according to the manufacturer, represents the maximum price 

that covered entities may permissibly be required to pay for 

the drug (referred to in this section as the ‘ceiling price’), 

and shall require that the manufacturer offer each covered 

entity covered drugs for purchase at or below the applicable 

ceiling price if such drug is made available to any other purchaser at any price.’’; and 

(2) in the first sentence of subsection (a)(5)(E), as redesignated by section 7101(c), by inserting ‘‘after audit as described 

in subparagraph (D) and’’ after ‘‘finds,’’. 

SEC. 7103. GAO STUDY TO MAKE RECOMMENDATIONS ON IMPROVING 

THE 340B PROGRAM. 

(a) REPORT.—Not later than 18 months after the date of enactment of this Act, the Comptroller General of the United States 

shall submit to Congress a report that examines whether those 

individuals served by the covered entities under the program under 

section 340B of the Public Health Service Act (42 U.S.C. 256b) 

(referred to in this section as the ‘‘340B program’’) are receiving 

optimal health care services. 

(b) RECOMMENDATIONS.—The report under subsection (a) shall 

include recommendations on the following: 
H. R. 3590—710 

(1) Whether the 340B program should be expanded since 

it is anticipated that the 47,000,000 individuals who are uninsured as of the date of enactment of this Act will have health 

care coverage once this Act is implemented. 

(2) Whether mandatory sales of certain products by the 

340B program could hinder patients access to those therapies 

through any provider. 

(3) Whether income from the 340B program is being used 

by the covered entities under the program to further the program objectives. 

TITLE VIII—CLASS ACT 

SEC. 8001. SHORT TITLE OF TITLE. 

This title may be cited as the ‘‘Community Living Assistance 

Services and Supports Act’’ or the ‘‘CLASS Act’’. 

SEC. 8002. ESTABLISHMENT OF NATIONAL VOLUNTARY INSURANCE 

PROGRAM FOR PURCHASING COMMUNITY LIVING 

ASSISTANCE SERVICES AND SUPPORT. 

(a) ESTABLISHMENT OF CLASS PROGRAM.— 

(1) IN GENERAL.—The Public Health Service Act (42 U.S.C. 

201 et seq.), as amended by section 4302(a), is amended by 

adding at the end the following: 

‘‘TITLE XXXII—COMMUNITY LIVING 

ASSISTANCE SERVICES AND SUPPORTS 

‘‘SEC. 3201. PURPOSE. 

‘‘The purpose of this title is to establish a national voluntary 

insurance program for purchasing community living assistance services and supports in order to— 

‘‘(1) provide individuals with functional limitations with 

tools that will allow them to maintain their personal and financial independence and live in the community through a new 

financing strategy for community living assistance services and 

supports; 

‘‘(2) establish an infrastructure that will help address the 

Nation’s community living assistance services and supports 

needs; 

‘‘(3) alleviate burdens on family caregivers; and 

‘‘(4) address institutional bias by providing a financing 

mechanism that supports personal choice and independence 

to live in the community. 

‘‘SEC. 3202. DEFINITIONS. 

‘‘In this title: 

‘‘(1) ACTIVE ENROLLEE.—The term ‘active enrollee’ means 

an individual who is enrolled in the CLASS program in accordance with section 3204 and who has paid any premiums due 

to maintain such enrollment. 

‘‘(2) ACTIVELY EMPLOYED.—The term ‘actively employed’ 

means an individual who— 

‘‘(A) is reporting for work at the individual’s usual 

place of employment or at another location to which the 
H. R. 3590—711 

individual is required to travel because of the individual’s 

employment (or in the case of an individual who is a 

member of the uniformed services, is on active duty and 

is physically able to perform the duties of the individual’s 

position); and 

‘‘(B) is able to perform all the usual and customary 

duties of the individual’s employment on the individual’s 

regular work schedule. 

‘‘(3) ACTIVITIES OF DAILY LIVING.—The term ‘activities of 

daily living’ means each of the following activities specified 

in section 7702B(c)(2)(B) of the Internal Revenue Code of 1986: 

‘‘(A) Eating. 

‘‘(B) Toileting. 

‘‘(C) Transferring. 

‘‘(D) Bathing. 

‘‘(E) Dressing. 

‘‘(F) Continence. 

‘‘(4) CLASS PROGRAM.—The term ‘CLASS program’ means 

the program established under this title. 

‘‘(5) ELIGIBILITY ASSESSMENT SYSTEM.—The term ‘Eligibility 

Assessment System’ means the entity established by the Secretary under section 3205(a)(2) to make functional eligibility 

determinations for the CLASS program. 

‘‘(6) ELIGIBLE BENEFICIARY.— 

‘‘(A) IN GENERAL.—The term ‘eligible beneficiary’ means 

any individual who is an active enrollee in the CLASS 

program and, as of the date described in subparagraph 

(B)— 

‘‘(i) has paid premiums for enrollment in such program for at least 60 months; 

‘‘(ii) has earned, with respect to at least 3 calendar 

years that occur during the first 60 months for which 

the individual has paid premiums for enrollment in 

the program, at least an amount equal to the amount 

of wages and self-employment income which an individual must have in order to be credited with a quarter 

of coverage under section 213(d) of the Social Security 

Act for the year; and 

‘‘(iii) has paid premiums for enrollment in such 

program for at least 24 consecutive months, if a lapse 

in premium payments of more than 3 months has 

occurred during the period that begins on the date 

of the individual’s enrollment and ends on the date 

of such determination. 

‘‘(B) DATE DESCRIBED.—For purposes of subparagraph 

(A), the date described in this subparagraph is the date 

on which the individual is determined to have a functional 

limitation described in section 3203(a)(1)(C) that is 

expected to last for a continuous period of more than 90 

days. 

‘‘(C) REGULATIONS.—The Secretary shall promulgate 

regulations specifying exceptions to the minimum earnings 

requirements under subparagraph (A)(ii) for purposes of 

being considered an eligible beneficiary for certain populations. 

‘‘(7) HOSPITAL; NURSING FACILITY; INTERMEDIATE CARE

FACILITY FOR THE MENTALLY RETARDED; INSTITUTION FOR
H. R. 3590—712 

MENTAL DISEASES.—The terms ‘hospital’, ‘nursing facility’, 

‘intermediate care facility for the mentally retarded’, and 

‘institution for mental diseases’ have the meanings given such 

terms for purposes of Medicaid. 

‘‘(8) CLASS INDEPENDENCE ADVISORY COUNCIL.—The term 

‘CLASS Independence Advisory Council’ or ‘Council’ means the 

Advisory Council established under section 3207 to advise the 

Secretary. 

‘‘(9) CLASS INDEPENDENCE BENEFIT PLAN.—The term 

‘CLASS Independence Benefit Plan’ means the benefit plan 

developed and designated by the Secretary in accordance with 

section 3203. 

‘‘(10) CLASS INDEPENDENCE FUND.—The term ‘CLASS 

Independence Fund’ or ‘Fund’ means the fund established under 

section 3206. 

‘‘(11) MEDICAID.—The term ‘Medicaid’ means the program 

established under title XIX of the Social Security Act (42 U.S.C. 

1396 et seq.). 

‘‘(12) POVERTY LINE.—The term ‘poverty line’ has the 

meaning given that term in section 2110(c)(5) of the Social 

Security Act (42 U.S.C. 1397jj(c)(5)). 

‘‘(13) PROTECTION AND ADVOCACY SYSTEM.—The term 

‘Protection and Advocacy System’ means the system for each 

State established under section 143 of the Developmental 

Disabilities Assistance and Bill of Rights Act of 2000 (42 U.S.C. 

15043). 

‘‘SEC. 3203. CLASS INDEPENDENCE BENEFIT PLAN. 

‘‘(a) PROCESS FOR DEVELOPMENT.— 

‘‘(1) IN GENERAL.—The Secretary, in consultation with 

appropriate actuaries and other experts, shall develop at least 

3 actuarially sound benefit plans as alternatives for consideration for designation by the Secretary as the CLASS Independence Benefit Plan under which eligible beneficiaries shall 

receive benefits under this title. Each of the plan alternatives 

developed shall be designed to provide eligible beneficiaries 

with the benefits described in section 3205 consistent with 

the following requirements: 

‘‘(A) PREMIUMS.— 

‘‘(i) IN GENERAL.—Beginning with the first year 

of the CLASS program, and for each year thereafter, 

subject to clauses (ii) and (iii), the Secretary shall 

establish all premiums to be paid by enrollees for the 

year based on an actuarial analysis of the 75-year 

costs of the program that ensures solvency throughout 

such 75-year period. 

‘‘(ii) NOMINAL PREMIUM FOR POOREST INDIVIDUALS

AND FULL-TIME STUDENTS.— 

‘‘(I) IN GENERAL.—The monthly premium for 

enrollment in the CLASS program shall not exceed 

the applicable dollar amount per month determined under subclause (II) for— 

‘‘(aa) any individual whose income does 

not exceed the poverty line; and 

‘‘(bb) any individual who has not attained 

age 22, and is actively employed during any 
H. R. 3590—713 

period in which the individual is a full-time 

student (as determined by the Secretary). 

‘‘(II) APPLICABLE DOLLAR AMOUNT.—The 

applicable dollar amount described in this subclause is the amount equal to $5, increased by 

the percentage increase in the consumer price 

index for all urban consumers (U.S. city average) 

for each year occurring after 2009 and before such 

year. 

‘‘(iii) CLASS INDEPENDENCE FUND RESERVES.—At 

such time as the CLASS program has been in operation 

for 10 years, the Secretary shall establish all premiums 

to be paid by enrollees for the year based on an actuarial analysis that accumulated reserves in the CLASS 

Independence Fund would not decrease in that year. 

At such time as the Secretary determines the CLASS 

program demonstrates a sustained ability to finance 

expected yearly expenses with expected yearly premiums and interest credited to the CLASS Independence Fund, the Secretary may decrease the required 

amount of CLASS Independence Fund reserves. 

‘‘(B) VESTING PERIOD.—A 5-year vesting period for eligibility for benefits. 

‘‘(C) BENEFIT TRIGGERS.—A benefit trigger for provision 

of benefits that requires a determination that an individual 

has a functional limitation, as certified by a licensed health 

care practitioner, described in any of the following clauses 

that is expected to last for a continuous period of more 

than 90 days: 

‘‘(i) The individual is determined to be unable to 

perform at least the minimum number (which may 

be 2 or 3) of activities of daily living as are required 

under the plan for the provision of benefits without 

substantial assistance (as defined by the Secretary) 

from another individual. 

‘‘(ii) The individual requires substantial supervision to protect the individual from threats to health 

and safety due to substantial cognitive impairment. 

‘‘(iii) The individual has a level of functional limitation similar (as determined under regulations prescribed by the Secretary) to the level of functional 

limitation described in clause (i) or (ii). 

‘‘(D) CASH BENEFIT.—Payment of a cash benefit that 

satisfies the following requirements: 

‘‘(i) MINIMUM REQUIRED AMOUNT.—The benefit 

amount provides an eligible beneficiary with not less 

than an average of $50 per day (as determined based 

on the reasonably expected distribution of beneficiaries 

receiving benefits at various benefit levels). 

‘‘(ii) AMOUNT SCALED TO FUNCTIONAL ABILITY.— 

The benefit amount is varied based on a scale of functional ability, with not less than 2, and not more than 

6, benefit level amounts. 

‘‘(iii) DAILY OR WEEKLY.—The benefit is paid on 

a daily or weekly basis. 

‘‘(iv) NO LIFETIME OR AGGREGATE LIMIT.—The benefit is not subject to any lifetime or aggregate limit. 
H. R. 3590—714 

‘‘(E) COORDINATION WITH SUPPLEMENTAL COVERAGE

OBTAINED THROUGH THE EXCHANGE.—The benefits allow 

for coordination with any supplemental coverage purchased 

through an Exchange established under section 1311 of 

the Patient Protection and Affordable Care Act. 

‘‘(2) REVIEW AND RECOMMENDATION BY THE CLASS

INDEPENDENCE ADVISORY COUNCIL.—The CLASS Independence 

Advisory Council shall— 

‘‘(A) evaluate the alternative benefit plans developed 

under paragraph (1); and 

‘‘(B) recommend for designation as the CLASS 

Independence Benefit Plan for offering to the public the 

plan that the Council determines best balances price and 

benefits to meet enrollees’ needs in an actuarially sound 

manner, while optimizing the probability of the long-term 

sustainability of the CLASS program. 

‘‘(3) DESIGNATION BY THE SECRETARY.—Not later than 

October 1, 2012, the Secretary, taking into consideration the 

recommendation of the CLASS Independence Advisory Council 

under paragraph (2)(B), shall designate a benefit plan as the 

CLASS Independence Benefit Plan. The Secretary shall publish 

such designation, along with details of the plan and the reasons 

for the selection by the Secretary, in a final rule that allows 

for a period of public comment. 

‘‘(b) ADDITIONAL PREMIUM REQUIREMENTS.— 

‘‘(1) ADJUSTMENT OF PREMIUMS.— 

‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B), (C), (D), and (E), the amount of the monthly 

premium determined for an individual upon such individual’s enrollment in the CLASS program shall remain the 

same for as long as the individual is an active enrollee 

in the program. 

‘‘(B) RECALCULATED PREMIUM IF REQUIRED FOR PROGRAM SOLVENCY.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), if the Secretary determines, based on the most recent report 

of the Board of Trustees of the CLASS Independence 

Fund, the advice of the CLASS Independence Advisory 

Council, and the annual report of the Inspector General 

of the Department of Health and Human Services, 

and waste, fraud, and abuse, or such other information 

as the Secretary determines appropriate, that the 

monthly premiums and income to the CLASS 

Independence Fund for a year are projected to be 

insufficient with respect to the 20-year period that 

begins with that year, the Secretary shall adjust the 

monthly premiums for individuals enrolled in the 

CLASS program as necessary (but maintaining a 

nominal premium for enrollees whose income is below 

the poverty line or who are full-time students actively 

employed). 

‘‘(ii) EXEMPTION FROM INCREASE.—Any increase in 

a monthly premium imposed as result of a determination described in clause (i) shall not apply with respect 

to the monthly premium of any active enrollee who— 

‘‘(I) has attained age 65; 
H. R. 3590—715 

‘‘(II) has paid premiums for enrollment in the 

program for at least 20 years; and 

‘‘(III) is not actively employed. 

‘‘(C) RECALCULATED PREMIUM IF REENROLLMENT AFTER

MORE THAN A 3-MONTH LAPSE.— 

‘‘(i) IN GENERAL.—The reenrollment of an individual after a 90-day period during which the individual failed to pay the monthly premium required 

to maintain the individual’s enrollment in the CLASS 

program shall be treated as an initial enrollment for 

purposes of age-adjusting the premium for enrollment 

in the program. 

‘‘(ii) CREDIT FOR PRIOR MONTHS IF REENROLLED

WITHIN 5 YEARS.—An individual who reenrolls in the 

CLASS program after such a 90-day period and before 

the end of the 5-year period that begins with the 

first month for which the individual failed to pay the 

monthly premium required to maintain the individual’s 

enrollment in the program shall be— 

‘‘(I) credited with any months of paid premiums that accrued prior to the individual’s lapse 

in enrollment; and 

‘‘(II) notwithstanding the total amount of any 

such credited months, required to satisfy section 

3202(6)(A)(ii) before being eligible to receive benefits. 

‘‘(D) NO LONGER STATUS AS A FULL-TIME STUDENT.— An individual subject to a nominal premium on the basis 

of being described in subsection (a)(1)(A)(ii)(I)(bb) who 

ceases to be described in that subsection, beginning with 

the first month following the month in which the individual 

ceases to be so described, shall be subject to the same 

monthly premium as the monthly premium that applies 

to an individual of the same age who first enrolls in the 

program under the most similar circumstances as the individual (such as the first year of eligibility for enrollment 

in the program or in a subsequent year). 

‘‘(E) PENALTY FOR REENOLLMENT AFTER 5-YEAR LAPSE.— In the case of an individual who reenrolls in the CLASS 

program after the end of the 5-year period described in 

subparagraph (C)(ii), the monthly premium required for 

the individual shall be the age-adjusted premium that 

would be applicable to an initially enrolling individual who 

is the same age as the reenrolling individual, increased 

by the greater of— 

‘‘(i) an amount that the Secretary determines is 

actuarially sound for each month that occurs during 

the period that begins with the first month for which 

the individual failed to pay the monthly premium 

required to maintain the individual’s enrollment in 

the CLASS program and ends with the month preceding the month in which the reenollment is effective; 

or 

‘‘(ii) 1 percent of the applicable age-adjusted premium for each such month occurring in such period. 

‘‘(2) ADMINISTRATIVE EXPENSES.—In determining the 

monthly premiums for the CLASS program the Secretary may 
H. R. 3590—716 

factor in costs for administering the program, not to exceed 

for any year in which the program is in effect under this 

title, an amount equal to 3 percent of all premiums paid during 

the year. 

‘‘(3) NO UNDERWRITING REQUIREMENTS.—No underwriting 

(other than on the basis of age in accordance with subparagraphs (D) and (E) of paragraph (1)) shall be used to— 

‘‘(A) determine the monthly premium for enrollment 

in the CLASS program; or 

‘‘(B) prevent an individual from enrolling in the program. 

‘‘(c) SELF-ATTESTATION AND VERIFICATION OF INCOME.—The Secretary shall establish procedures to— 

‘‘(1) permit an individual who is eligible for the nominal 

premium required under subsection (a)(1)(A)(ii), as part of their 

automatic enrollment in the CLASS program, to self-attest 

that their income does not exceed the poverty line or that 

their status as a full-time student who is actively employed; 

‘‘(2) verify, using procedures similar to the procedures used 

by the Commissioner of Social Security under section 

1631(e)(1)(B)(ii) of the Social Security Act and consistent with 

the requirements applicable to the conveyance of data and 

information under section 1942 of such Act, the validity of 

such self-attestation; and 

‘‘(3) require an individual to confirm, on at least an annual 

basis, that their income does not exceed the poverty line or 

that they continue to maintain such status. 

‘‘SEC. 3204. ENROLLMENT AND DISENROLLMENT REQUIREMENTS. 

‘‘(a) AUTOMATIC ENROLLMENT.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), the Secretary, 

in coordination with the Secretary of the Treasury, shall establish procedures under which each individual described in subsection (c) may be automatically enrolled in the CLASS program 

by an employer of such individual in the same manner as 

an employer may elect to automatically enroll employees in 

a plan under section 401(k), 403(b), or 457 of the Internal 

Revenue Code of 1986. 

‘‘(2) ALTERNATIVE ENROLLMENT PROCEDURES.—The procedures established under paragraph (1) shall provide for an 

alternative enrollment process for an individual described in 

subsection (c) in the case of such an individual— 

‘‘(A) who is self-employed; 

‘‘(B) who has more than 1 employer; or 

‘‘(C) whose employer does not elect to participate in 

the automatic enrollment process established by the Secretary. 

‘‘(3) ADMINISTRATION.— ‘‘(A) IN GENERAL.—The Secretary and the Secretary 

of the Treasury shall, by regulation, establish procedures 

to ensure that an individual is not automatically enrolled 

in the CLASS program by more than 1 employer. 

‘‘(B) FORM.—Enrollment in the CLASS program shall 

be made in such manner as the Secretary may prescribe 

in order to ensure ease of administration. 

‘‘(b) ELECTION TO OPT-OUT.—An individual described in subsection (c) may elect to waive enrollment in the CLASS program 
H. R. 3590—717 

at any time in such form and manner as the Secretary and the 

Secretary of the Treasury shall prescribe. 

‘‘(c) INDIVIDUAL DESCRIBED.—For purposes of enrolling in the 

CLASS program, an individual described in this paragraph is an 

individual— 

‘‘(1) who has attained age 18; 

‘‘(2) who— 

‘‘(A) receives wages on which there is imposed a tax 

under section 3201(a) of the Internal Revenue Code of 

1986; or 

‘‘(B) derives self-employment income on which there 

is imposed a tax under section 1401(a) of the Internal 

Revenue Code of 1986; 

‘‘(3) who is actively employed; and 

‘‘(4) who is not— 

‘‘(A) a patient in a hospital or nursing facility, an 

intermediate care facility for the mentally retarded, or 

an institution for mental diseases and receiving medical 

assistance under Medicaid; or 

‘‘(B) confined in a jail, prison, other penal institution 

or correctional facility, or by court order pursuant to conviction of a criminal offense or in connection with a verdict 

or finding described in section 202(x)(1)(A)(ii) of the Social 

Security Act (42 U.S.C. 402(x)(1)(A)(ii)). 

‘‘(d) RULE OF CONSTRUCTION.—Nothing in this title shall be 

construed as requiring an active enrollee to continue to satisfy 

subparagraph (B) or (C) of subsection (c)(1) in order to maintain 

enrollment in the CLASS program. 

‘‘(e) PAYMENT.— 

‘‘(1) PAYROLL DEDUCTION.—An amount equal to the monthly 

premium for the enrollment in the CLASS program of an individual shall be deducted from the wages or self-employment 

income of such individual in accordance with such procedures 

as the Secretary, in coordination with the Secretary of the 

Treasury, shall establish for employers who elect to deduct 

and withhold such premiums on behalf of enrolled employees. 

‘‘(2) ALTERNATIVE PAYMENT MECHANISM.—The Secretary, 

in coordination with the Secretary of the Treasury, shall establish alternative procedures for the payment of monthly premiums by an individual enrolled in the CLASS program— 

‘‘(A) who does not have an employer who elects to 

deduct and withhold premiums in accordance with subparagraph (A); or 

‘‘(B) who does not earn wages or derive self-employment income. 

‘‘(f) TRANSFER OF PREMIUMS COLLECTED.— ‘‘(1) IN GENERAL.—During each calendar year the Secretary 

of the Treasury shall deposit into the CLASS Independence 

Fund a total amount equal, in the aggregate, to 100 percent 

of the premiums collected during that year. 

‘‘(2) TRANSFERS BASED ON ESTIMATES.—The amount deposited pursuant to paragraph (1) shall be transferred in at least 

monthly payments to the CLASS Independence Fund on the 

basis of estimates by the Secretary and certified to the Secretary of the Treasury of the amounts collected in accordance 

with subparagraphs (A) and (B) of paragraph (5). Proper adjustments shall be made in amounts subsequently transferred to 
H. R. 3590—718 

the Fund to the extent prior estimates were in excess of, or 

were less than, actual amounts collected. 

‘‘(g) OTHER ENROLLMENT AND DISENROLLMENT OPPORTUNITIES.—The Secretary, in coordination with the Secretary of the 

Treasury, shall establish procedures under which— 

‘‘(1) an individual who, in the year of the individual’s 

initial eligibility to enroll in the CLASS program, has elected 

to waive enrollment in the program, is eligible to elect to 

enroll in the program, in such form and manner as the Secretaries shall establish, only during an open enrollment period 

established by the Secretaries that is specific to the individual 

and that may not occur more frequently than biennially after 

the date on which the individual first elected to waive enrollment in the program; and 

‘‘(2) an individual shall only be permitted to disenroll from 

the program (other than for nonpayment of premiums) during 

an annual disenrollment period established by the Secretaries 

and in such form and manner as the Secretaries shall establish. 

‘‘SEC. 3205. BENEFITS. 

‘‘(a) DETERMINATION OF ELIGIBILITY.— 

‘‘(1) APPLICATION FOR RECEIPT OF BENEFITS.—The Secretary 

shall establish procedures under which an active enrollee shall 

apply for receipt of benefits under the CLASS Independence 

Benefit Plan. 

‘‘(2) ELIGIBILITY ASSESSMENTS.— 

‘‘(A) IN GENERAL.—Not later than January 1, 2012, 

the Secretary shall— 

‘‘(i) establish an Eligibility Assessment System 

(other than a service with which the Commissioner 

of Social Security has entered into an agreement, with 

respect to any State, to make disability determinations 

for purposes of title II or XVI of the Social Security 

Act) to provide for eligibility assessments of active 

enrollees who apply for receipt of benefits; 

‘‘(ii) enter into an agreement with the Protection 

and Advocacy System for each State to provide 

advocacy services in accordance with subsection (d); 

and 

‘‘(iii) enter into an agreement with public and private entities to provide advice and assistance counseling in accordance with subsection (e). 

‘‘(B) REGULATIONS.—The Secretary shall promulgate 

regulations to develop an expedited nationally equitable 

eligibility determination process, as certified by a licensed 

health care practitioner, an appeals process, and a redetermination process, as certified by a licensed health care 

practitioner, including whether an active enrollee is eligible 

for a cash benefit under the program and if so, the amount 

of the cash benefit (in accordance the sliding scale established under the plan). 

‘‘(C) PRESUMPTIVE ELIGIBILITY FOR CERTAIN INSTITUTIONALIZED ENROLLEES PLANNING TO DISCHARGE.—An 

active enrollee shall be deemed presumptively eligible if 

the enrollee— 

‘‘(i) has applied for, and attests is eligible for, 

the maximum cash benefit available under the sliding 
H. R. 3590—719 

scale established under the CLASS Independence Benefit Plan; 

‘‘(ii) is a patient in a hospital (but only if the 

hospitalization is for long-term care), nursing facility, 

intermediate care facility for the mentally retarded, 

or an institution for mental diseases; and 

‘‘(iii) is in the process of, or about to begin the 

process of, planning to discharge from the hospital, 

facility, or institution, or within 60 days from the date 

of discharge from the hospital, facility, or institution. 

‘‘(D) APPEALS.—The Secretary shall establish procedures under which an applicant for benefits under the 

CLASS Independence Benefit Plan shall be guaranteed 

the right to appeal an adverse determination. 

‘‘(b) BENEFITS.—An eligible beneficiary shall receive the following benefits under the CLASS Independence Benefit Plan: 

‘‘(1) CASH BENEFIT.—A cash benefit established by the Secretary in accordance with the requirements of section 

3203(a)(1)(D) that— 

‘‘(A) the first year in which beneficiaries receive the 

benefits under the plan, is not less than the average dollar 

amount specified in clause (i) of such section; and 

‘‘(B) for any subsequent year, is not less than the 

average per day dollar limit applicable under this subparagraph for the preceding year, increased by the percentage 

increase in the consumer price index for all urban consumers (U.S. city average) over the previous year. 

‘‘(2) ADVOCACY SERVICES.—Advocacy services in accordance 

with subsection (d). 

‘‘(3) ADVICE AND ASSISTANCE COUNSELING.—Advice and 

assistance counseling in accordance with subsection (e). 

‘‘(4) ADMINISTRATIVE EXPENSES.—Advocacy services and 

advise and assistance counseling services under paragraphs 

(2) and (3) of this subsection shall be included as administrative 

expenses under section 3203(b)(3). 

‘‘(c) PAYMENT OF BENEFITS.— ‘‘(1) LIFE INDEPENDENCE ACCOUNT.— ‘‘(A) IN GENERAL.—The Secretary shall establish procedures for administering the provision of benefits to eligible 

beneficiaries under the CLASS Independence Benefit Plan, 

including the payment of the cash benefit for the beneficiary into a Life Independence Account established by 

the Secretary on behalf of each eligible beneficiary. 

‘‘(B) USE OF CASH BENEFITS.—Cash benefits paid into 

a Life Independence Account of an eligible beneficiary shall 

be used to purchase nonmedical services and supports that 

the beneficiary needs to maintain his or her independence 

at home or in another residential setting of their choice 

in the community, including (but not limited to) home 

modifications, assistive technology, accessible transportation, homemaker services, respite care, personal assistance services, home care aides, and nursing support. 

Nothing in the preceding sentence shall prevent an eligible 

beneficiary from using cash benefits paid into a Life 

Independence Account for obtaining assistance with decision making concerning medical care, including the right 

to accept or refuse medical or surgical treatment and the 
H. R. 3590—720 

right to formulate advance directives or other written 

instructions recognized under State law, such as a living 

will or durable power of attorney for health care, in the 

case that an injury or illness causes the individual to 

be unable to make health care decisions. 

‘‘(C) ELECTRONIC MANAGEMENT OF FUNDS.—The Secretary shall establish procedures for— 

‘‘(i) crediting an account established on behalf of 

a beneficiary with the beneficiary’s cash daily benefit; 

‘‘(ii) allowing the beneficiary to access such account 

through debit cards; and 

‘‘(iii) accounting for withdrawals by the beneficiary 

from such account. 

‘‘(D) PRIMARY PAYOR RULES FOR BENEFICIARIES WHO

ARE ENROLLED IN MEDICAID.—In the case of an eligible 

beneficiary who is enrolled in Medicaid, the following payment rules shall apply: 

‘‘(i) INSTITUTIONALIZED BENEFICIARY.—If the beneficiary is a patient in a hospital, nursing facility, intermediate care facility for the mentally retarded, or an 

institution for mental diseases, the beneficiary shall 

retain an amount equal to 5 percent of the beneficiary’s 

daily or weekly cash benefit (as applicable) (which 

shall be in addition to the amount of the beneficiary’s 

personal needs allowance provided under Medicaid), 

and the remainder of such benefit shall be applied 

toward the facility’s cost of providing the beneficiary’s 

care, and Medicaid shall provide secondary coverage 

for such care. 

‘‘(ii) BENEFICIARIES RECEIVING HOME AND COMMU- NITY-BASED SERVICES.— ‘‘(I) 50 PERCENT OF BENEFIT RETAINED BY BENE- FICIARY.—Subject to subclause (II), if a beneficiary 

is receiving medical assistance under Medicaid for 

home and community based services, the beneficiary shall retain an amount equal to 50 percent 

of the beneficiary’s daily or weekly cash benefit 

(as applicable), and the remainder of the daily 

or weekly cash benefit shall be applied toward 

the cost to the State of providing such assistance 

(and shall not be used to claim Federal matching 

funds under Medicaid), and Medicaid shall provide 

secondary coverage for the remainder of any costs 

incurred in providing such assistance. 

‘‘(II) REQUIREMENT FOR STATE OFFSET.—A 

State shall be paid the remainder of a beneficiary’s 

daily or weekly cash benefit under subclause (I) 

only if the State home and community-based 

waiver under section 1115 of the Social Security 

Act (42 U.S.C. 1315) or subsection (c) or (d) of 

section 1915 of such Act (42 U.S.C. 1396n), or 

the State plan amendment under subsection (i) 

of such section does not include a waiver of the 

requirements of section 1902(a)(1) of the Social 

Security Act (relating to statewideness) or of section 1902(a)(10)(B) of such Act (relating to comparability) and the State offers at a minimum 
H. R. 3590—721 

case management services, personal care services, 

habilitation services, and respite care under such 

a waiver or State plan amendment. 

‘‘(III) DEFINITION OF HOME AND COMMUNITYBASED SERVICES.—In this clause, the term ‘home 

and community-based services’ means any services 

which may be offered under a home and community-based waiver authorized for a State under 

section 1115 of the Social Security Act (42 U.S.C. 

1315) or subsection (c) or (d) of section 1915 of 

such Act (42 U.S.C. 1396n) or under a State plan 

amendment under subsection (i) of such section. 

‘‘(iii) BENEFICIARIES ENROLLED IN PROGRAMS OF

ALL-INCLUSIVE CARE FOR THE ELDERLY (PACE).— 

‘‘(I) IN GENERAL.—Subject to subclause (II), 

if a beneficiary is receiving medical assistance 

under Medicaid for PACE program services under 

section 1934 of the Social Security Act (42 U.S.C. 

1396u–4), the beneficiary shall retain an amount 

equal to 50 percent of the beneficiary’s daily or 

weekly cash benefit (as applicable), and the 

remainder of the daily or weekly cash benefit shall 

be applied toward the cost to the State of providing 

such assistance (and shall not be used to claim 

Federal matching funds under Medicaid), and 

Medicaid shall provide secondary coverage for the 

remainder of any costs incurred in providing such 

assistance. 

‘‘(II) INSTITUTIONALIZED RECIPIENTS OF PACE

PROGRAM SERVICES.—If a beneficiary receiving 

assistance under Medicaid for PACE program services is a patient in a hospital, nursing facility, 

intermediate care facility for the mentally 

retarded, or an institution for mental diseases, 

the beneficiary shall be treated as in institutionalized beneficiary under clause (i). 

‘‘(2) AUTHORIZED REPRESENTATIVES.— 

‘‘(A) IN GENERAL.—The Secretary shall establish procedures to allow access to a beneficiary’s cash benefits by 

an authorized representative of the eligible beneficiary on 

whose behalf such benefits are paid. 

‘‘(B) QUALITY ASSURANCE AND PROTECTION AGAINST

FRAUD AND ABUSE.—The procedures established under 

subparagraph (A) shall ensure that authorized representatives of eligible beneficiaries comply with standards of conduct established by the Secretary, including standards 

requiring that such representatives provide quality services 

on behalf of such beneficiaries, do not have conflicts of 

interest, and do not misuse benefits paid on behalf of 

such beneficiaries or otherwise engage in fraud or abuse. 

‘‘(3) COMMENCEMENT OF BENEFITS.—Benefits shall be paid 

to, or on behalf of, an eligible beneficiary beginning with the 

first month in which an application for such benefits is 

approved. 

‘‘(4) ROLLOVER OPTION FOR LUMP-SUM PAYMENT.—An 

eligible beneficiary may elect to— 
H. R. 3590—722 

‘‘(A) defer payment of their daily or weekly benefit 

and to rollover any such deferred benefits from monthto-month, but not from year-to-year; and 

‘‘(B) receive a lump-sum payment of such deferred 

benefits in an amount that may not exceed the lesser 

of— 

‘‘(i) the total amount of the accrued deferred benefits; or 

‘‘(ii) the applicable annual benefit. 

‘‘(5) PERIOD FOR DETERMINATION OF ANNUAL BENEFITS.— ‘‘(A) IN GENERAL.—The applicable period for determining with respect to an eligible beneficiary the applicable 

annual benefit and the amount of any accrued deferred 

benefits is the 12-month period that commences with the 

first month in which the beneficiary began to receive such 

benefits, and each 12-month period thereafter. 

‘‘(B) INCLUSION OF INCREASED BENEFITS.—The Secretary shall establish procedures under which cash benefits 

paid to an eligible beneficiary that increase or decrease 

as a result of a change in the functional status of the 

beneficiary before the end of a 12-month benefit period 

shall be included in the determination of the applicable 

annual benefit paid to the eligible beneficiary. 

‘‘(C) RECOUPMENT OF UNPAID, ACCRUED BENEFITS.— 

‘‘(i) IN GENERAL.—The Secretary, in coordination 

with the Secretary of the Treasury, shall recoup any 

accrued benefits in the event of— 

‘‘(I) the death of a beneficiary; or 

‘‘(II) the failure of a beneficiary to elect under 

paragraph (4)(B) to receive such benefits as a 

lump-sum payment before the end of the 12-month 

period in which such benefits accrued. 

‘‘(ii) PAYMENT INTO CLASS INDEPENDENCE FUND.— Any benefits recouped in accordance with clause (i) 

shall be paid into the CLASS Independence Fund and 

used in accordance with section 3206. 

‘‘(6) REQUIREMENT TO RECERTIFY ELIGIBILITY FOR RECEIPT

OF BENEFITS.—An eligible beneficiary shall periodically, as 

determined by the Secretary— 

‘‘(A) recertify by submission of medical evidence the 

beneficiary’s continued eligibility for receipt of benefits; 

and 

‘‘(B) submit records of expenditures attributable to the 

aggregate cash benefit received by the beneficiary during 

the preceding year. 

‘‘(7) SUPPLEMENT, NOT SUPPLANT OTHER HEALTH CARE BENE- FITS.—Subject to the Medicaid payment rules under paragraph 

(1)(D), benefits received by an eligible beneficiary shall supplement, but not supplant, other health care benefits for which 

the beneficiary is eligible under Medicaid or any other Federally 

funded program that provides health care benefits or assistance. 

‘‘(d) ADVOCACY SERVICES.—An agreement entered into under 

subsection (a)(2)(A)(ii) shall require the Protection and Advocacy 

System for the State to— 

‘‘(1) assign, as needed, an advocacy counselor to each 

eligible beneficiary that is covered by such agreement and 

who shall provide an eligible beneficiary with— 
H. R. 3590—723 

‘‘(A) information regarding how to access the appeals 

process established for the program; 

‘‘(B) assistance with respect to the annual recertification and notification required under subsection (c)(6); 

and 

‘‘(C) such other assistance with obtaining services as 

the Secretary, by regulation, shall require; and 

‘‘(2) ensure that the System and such counselors comply 

with the requirements of subsection (h). 

‘‘(e) ADVICE AND ASSISTANCE COUNSELING.—An agreement 

entered into under subsection (a)(2)(A)(iii) shall require the entity 

to assign, as requested by an eligible beneficiary that is covered 

by such agreement, an advice and assistance counselor who shall 

provide an eligible beneficiary with information regarding— 

‘‘(1) accessing and coordinating long-term services and supports in the most integrated setting; 

‘‘(2) possible eligibility for other benefits and services; 

‘‘(3) development of a service and support plan; 

‘‘(4) information about programs established under the 

Assistive Technology Act of 1998 and the services offered under 

such programs; 

‘‘(5) available assistance with decision making concerning 

medical care, including the right to accept or refuse medical 

or surgical treatment and the right to formulate advance directives or other written instructions recognized under State law, 

such as a living will or durable power of attorney for health 

care, in the case that an injury or illness causes the individual 

to be unable to make health care decisions; and 

‘‘(6) such other services as the Secretary, by regulation, 

may require. 

‘‘(f) NO EFFECT ON ELIGIBILITY FOR OTHER BENEFITS.—Benefits 

paid to an eligible beneficiary under the CLASS program shall 

be disregarded for purposes of determining or continuing the beneficiary’s eligibility for receipt of benefits under any other Federal, 

State, or locally funded assistance program, including benefits paid 

under titles II, XVI, XVIII, XIX, or XXI of the Social Security 

Act (42 U.S.C. 401 et seq., 1381 et seq., 1395 et seq., 1396 et 

seq., 1397aa et seq.), under the laws administered by the Secretary 

of Veterans Affairs, under low-income housing assistance programs, 

or under the supplemental nutrition assistance program established 

under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.). 

‘‘(g) RULE OF CONSTRUCTION.—Nothing in this title shall be 

construed as prohibiting benefits paid under the CLASS Independence Benefit Plan from being used to compensate a family caregiver 

for providing community living assistance services and supports 

to an eligible beneficiary. 

‘‘(h) PROTECTION AGAINST CONFLICT OF INTERESTS.—The Secretary shall establish procedures to ensure that the Eligibility 

Assessment System, the Protection and Advocacy System for a 

State, advocacy counselors for eligible beneficiaries, and any other 

entities that provide services to active enrollees and eligible beneficiaries under the CLASS program comply with the following: 

‘‘(1) If the entity provides counseling or planning services, 

such services are provided in a manner that fosters the best 

interests of the active enrollee or beneficiary. 
H. R. 3590—724 

‘‘(2) The entity has established operating procedures that 

are designed to avoid or minimize conflicts of interest between 

the entity and an active enrollee or beneficiary. 

‘‘(3) The entity provides information about all services and 

options available to the active enrollee or beneficiary, to the 

best of its knowledge, including services available through other 

entities or providers. 

‘‘(4) The entity assists the active enrollee or beneficiary 

to access desired services, regardless of the provider. 

‘‘(5) The entity reports the number of active enrollees and 

beneficiaries provided with assistance by age, disability, and 

whether such enrollees and beneficiaries received services from 

the entity or another entity. 

‘‘(6) If the entity provides counseling or planning services, 

the entity ensures that an active enrollee or beneficiary is 

informed of any financial interest that the entity has in a 

service provider. 

‘‘(7) The entity provides an active enrollee or beneficiary 

with a list of available service providers that can meet the 

needs of the active enrollee or beneficiary. 

‘‘SEC. 3206. CLASS INDEPENDENCE FUND. 

‘‘(a) ESTABLISHMENT OF CLASS INDEPENDENCE FUND.—There 

is established in the Treasury of the United States a trust fund 

to be known as the ‘CLASS Independence Fund’. The Secretary 

of the Treasury shall serve as Managing Trustee of such Fund. 

The Fund shall consist of all amounts derived from payments into 

the Fund under sections 3204(f) and 3205(c)(5)(C)(ii), and remaining 

after investment of such amounts under subsection (b), including 

additional amounts derived as income from such investments. The 

amounts held in the Fund are appropriated and shall remain available without fiscal year limitation— 

‘‘(1) to be held for investment on behalf of individuals 

enrolled in the CLASS program; 

‘‘(2) to pay the administrative expenses related to the Fund 

and to investment under subsection (b); and 

‘‘(3) to pay cash benefits to eligible beneficiaries under 

the CLASS Independence Benefit Plan. 

‘‘(b) INVESTMENT OF FUND BALANCE.—The Secretary of the 

Treasury shall invest and manage the CLASS Independence Fund 

in the same manner, and to the same extent, as the Federal Supplementary Medical Insurance Trust Fund may be invested and managed under subsections (c), (d), and (e) of section 1841(d) of the 

Social Security Act (42 U.S.C. 1395t). 

‘‘(c) BOARD OF TRUSTEES.— 

‘‘(1) IN GENERAL.—With respect to the CLASS Independence 

Fund, there is hereby created a body to be known as the 

Board of Trustees of the CLASS Independence Fund (hereinafter in this section referred to as the ‘Board of Trustees’) 

composed of the Secretary of the Treasury, the Secretary of 

Labor, and the Secretary of Health and Human Services, all 

ex officio, and of two members of the public (both of whom 

may not be from the same political party), who shall be nominated by the President for a term of 4 years and subject 

to confirmation by the Senate. A member of the Board of 

Trustees serving as a member of the public and nominated 

and confirmed to fill a vacancy occurring during a term shall 
H. R. 3590—725 

be nominated and confirmed only for the remainder of such 

term. An individual nominated and confirmed as a member 

of the public may serve in such position after the expiration 

of such member’s term until the earlier of the time at which 

the member’s successor takes office or the time at which a 

report of the Board is first issued under paragraph (2) after 

the expiration of the member’s term. The Secretary of the 

Treasury shall be the Managing Trustee of the Board of 

Trustees. The Board of Trustees shall meet not less frequently 

than once each calendar year. A person serving on the Board 

of Trustees shall not be considered to be a fiduciary and shall 

not be personally liable for actions taken in such capacity 

with respect to the Trust Fund. 

‘‘(2) DUTIES.— 

‘‘(A) IN GENERAL.—It shall be the duty of the Board 

of Trustees to do the following: 

‘‘(i) Hold the CLASS Independence Fund. 

‘‘(ii) Report to the Congress not later than the 

first day of April of each year on the operation and 

status of the CLASS Independence Fund during the 

preceding fiscal year and on its expected operation 

and status during the current fiscal year and the next 

2 fiscal years. 

‘‘(iii) Report immediately to the Congress whenever 

the Board is of the opinion that the amount of the 

CLASS Independence Fund is not actuarially sound 

in regards to the projection under section 

3203(b)(1)(B)(i). 

‘‘(iv) Review the general policies followed in managing the CLASS Independence Fund, and recommend 

changes in such policies, including necessary changes 

in the provisions of law which govern the way in which 

the CLASS Independence Fund is to be managed. 

‘‘(B) REPORT.—The report provided for in subparagraph 

(A)(ii) shall— 

‘‘(i) include— 

‘‘(I) a statement of the assets of, and the 

disbursements made from, the CLASS Independence Fund during the preceding fiscal year; 

‘‘(II) an estimate of the expected income to, 

and disbursements to be made from, the CLASS 

Independence Fund during the current fiscal year 

and each of the next 2 fiscal years; 

‘‘(III) a statement of the actuarial status of 

the CLASS Independence Fund for the current 

fiscal year, each of the next 2 fiscal years, and 

as projected over the 75-year period beginning with 

the current fiscal year; and 

‘‘(IV) an actuarial opinion by the Chief Actuary 

of the Centers for Medicare & Medicaid Services 

certifying that the techniques and methodologies 

used are generally accepted within the actuarial 

profession and that the assumptions and cost estimates used are reasonable; and 

‘‘(ii) be printed as a House document of the session 

of the Congress to which the report is made. 
H. R. 3590—726 

‘‘(C) RECOMMENDATIONS.—If the Board of Trustees 

determines that enrollment trends and expected future benefit claims on the CLASS Independence Fund are not 

actuarially sound in regards to the projection under section 

3203(b)(1)(B)(i) and are unlikely to be resolved with reasonable premium increases or through other means, the Board 

of Trustees shall include in the report provided for in 

subparagraph (A)(ii) recommendations for such legislative 

action as the Board of Trustees determine to be appropriate, including whether to adjust monthly premiums or 

impose a temporary moratorium on new enrollments. 

‘‘SEC. 3207. CLASS INDEPENDENCE ADVISORY COUNCIL. 

‘‘(a) ESTABLISHMENT.—There is hereby created an Advisory 

Committee to be known as the ‘CLASS Independence Advisory 

Council’. 

‘‘(b) MEMBERSHIP.— ‘‘(1) IN GENERAL.—The CLASS Independence Advisory 

Council shall be composed of not more than 15 individuals, 

not otherwise in the employ of the United States— 

‘‘(A) who shall be appointed by the President without 

regard to the civil service laws and regulations; and 

‘‘(B) a majority of whom shall be representatives of 

individuals who participate or are likely to participate in 

the CLASS program, and shall include representatives of 

older and younger workers, individuals with disabilities, 

family caregivers of individuals who require services and 

supports to maintain their independence at home or in 

another residential setting of their choice in the community, 

individuals with expertise in long-term care or disability 

insurance, actuarial science, economics, and other relevant 

disciplines, as determined by the Secretary. 

‘‘(2) TERMS.— ‘‘(A) IN GENERAL.—The members of the CLASS 

Independence Advisory Council shall serve overlapping 

terms of 3 years (unless appointed to fill a vacancy occurring prior to the expiration of a term, in which case the 

individual shall serve for the remainder of the term). 

‘‘(B) LIMITATION.—A member shall not be eligible to 

serve for more than 2 consecutive terms. 

‘‘(3) CHAIR.—The President shall, from time to time, appoint 

one of the members of the CLASS Independence Advisory 

Council to serve as the Chair. 

‘‘(c) DUTIES.—The CLASS Independence Advisory Council shall 

advise the Secretary on matters of general policy in the administration of the CLASS program established under this title and in 

the formulation of regulations under this title including with respect 

to— 

‘‘(1) the development of the CLASS Independence Benefit 

Plan under section 3203; 

‘‘(2) the determination of monthly premiums under such 

plan; and 

‘‘(3) the financial solvency of the program. 

‘‘(d) APPLICATION OF FACA.—The Federal Advisory Committee 

Act (5 U.S.C. App.), other than section 14 of that Act, shall apply 

to the CLASS Independence Advisory Council. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.— 
H. R. 3590—727 

‘‘(1) IN GENERAL.—There are authorized to be appropriated 

to the CLASS Independence Advisory Council to carry out 

its duties under this section, such sums as may be necessary 

for fiscal year 2011 and for each fiscal year thereafter. 

‘‘(2) AVAILABILITY.—Any sums appropriated under the 

authorization contained in this section shall remain available, 

without fiscal year limitation, until expended. 

‘‘SEC. 3208. SOLVENCY AND FISCAL INDEPENDENCE; REGULATIONS; 

ANNUAL REPORT. 

‘‘(a) SOLVENCY.—The Secretary shall regularly consult with the 

Board of Trustees of the CLASS Independence Fund and the CLASS 

Independence Advisory Council, for purposes of ensuring that 

enrollees premiums are adequate to ensure the financial solvency 

of the CLASS program, both with respect to fiscal years occurring 

in the near-term and fiscal years occurring over 20- and 75-year 

periods, taking into account the projections required for such periods 

under subsections (a)(1)(A)(i) and (b)(1)(B)(i) of section 3202. 

‘‘(b) NO TAXPAYER FUNDS USED TO PAY BENEFITS.—No taxpayer 

funds shall be used for payment of benefits under a CLASS Independent Benefit Plan. For purposes of this subsection, the term 

‘taxpayer funds’ means any Federal funds from a source other 

than premiums deposited by CLASS program participants in the 

CLASS Independence Fund and any associated interest earnings. 

‘‘(c) REGULATIONS.—The Secretary shall promulgate such regulations as are necessary to carry out the CLASS program in accordance with this title. Such regulations shall include provisions to 

prevent fraud and abuse under the program. 

‘‘(d) ANNUAL REPORT.—Beginning January 1, 2014, the Secretary shall submit an annual report to Congress on the CLASS 

program. Each report shall include the following: 

‘‘(1) The total number of enrollees in the program. 

‘‘(2) The total number of eligible beneficiaries during the 

fiscal year. 

‘‘(3) The total amount of cash benefits provided during 

the fiscal year. 

‘‘(4) A description of instances of fraud or abuse identified 

during the fiscal year. 

‘‘(5) Recommendations for such administrative or legislative 

action as the Secretary determines is necessary to improve 

the program, ensure the solvency of the program, or to prevent 

the occurrence of fraud or abuse. 

‘‘SEC. 3209. INSPECTOR GENERAL’S REPORT. 

‘‘The Inspector General of the Department of Health and 

Human Services shall submit an annual report to the Secretary 

and Congress relating to the overall progress of the CLASS program 

and of the existence of waste, fraud, and abuse in the CLASS 

program. Each such report shall include findings in the following 

areas: 

‘‘(1) The eligibility determination process. 

‘‘(2) The provision of cash benefits. 

‘‘(3) Quality assurance and protection against waste, fraud, 

and abuse. 

‘‘(4) Recouping of unpaid and accrued benefits. 
H. R. 3590—728 

‘‘SEC. 3210. TAX TREATMENT OF PROGRAM. 

‘‘The CLASS program shall be treated for purposes of the 

Internal Revenue Code of 1986 in the same manner as a qualified 

long-term care insurance contract for qualified long-term care services.’’. 

(2) CONFORMING AMENDMENTS TO MEDICAID.—Section 

1902(a) of the Social Security Act (42 U.S.C. 1396a(a)), as 

amended by section 6505, is amended by inserting after paragraph (80) the following: 

‘‘(81) provide that the State will comply with such regulations regarding the application of primary and secondary payor 

rules with respect to individuals who are eligible for medical 

assistance under this title and are eligible beneficiaries under 

the CLASS program established under title XXXII of the Public 

Health Service Act as the Secretary shall establish; and’’. 

(b) ASSURANCE OF ADEQUATE INFRASTRUCTURE FOR THE PROVI- SION OF PERSONAL CARE ATTENDANT WORKERS.—Section 1902(a) 

of the Social Security Act (42 U.S.C. 1396a(a)), as amended by 

subsection (a)(2), is amended by inserting after paragraph (81) 

the following: 

‘‘(82) provide that, not later than 2 years after the date 

of enactment of the Community Living Assistance Services 

and Supports Act, each State shall— 

‘‘(A) assess the extent to which entities such as providers of home care, home health services, home and 

community service providers, public authorities created to 

provide personal care services to individuals eligible for 

medical assistance under the State plan, and nonprofit 

organizations, are serving or have the capacity to serve 

as fiscal agents for, employers of, and providers of employment-related benefits for, personal care attendant workers 

who provide personal care services to individuals receiving 

benefits under the CLASS program established under title 

XXXII of the Public Health Service Act, including in rural 

and underserved areas; 

‘‘(B) designate or create such entities to serve as fiscal 

agents for, employers of, and providers of employmentrelated benefits for, such workers to ensure an adequate 

supply of the workers for individuals receiving benefits 

under the CLASS program, including in rural and underserved areas; and 

‘‘(C) ensure that the designation or creation of such 

entities will not negatively alter or impede existing programs, models, methods, or administration of service 

delivery that provide for consumer controlled or selfdirected home and community services and further ensure 

that such entities will not impede the ability of individuals 

to direct and control their home and community services, 

including the ability to select, manage, dismiss, co-employ, 

or employ such workers or inhibit such individuals from 

relying on family members for the provision of personal 

care services.’’. 

(c) PERSONAL CARE ATTENDANTS WORKFORCE ADVISORY

PANEL.— 

(1) ESTABLISHMENT.—Not later than 90 days after the date 

of enactment of this Act, the Secretary of Health and Human 

Services shall establish a Personal Care Attendants Workforce 
H. R. 3590—729 

Advisory Panel for the purpose of examining and advising 

the Secretary and Congress on workforce issues related to 

personal care attendant workers, including with respect to the 

adequacy of the number of such workers, the salaries, wages, 

and benefits of such workers, and access to the services provided 

by such workers. 

(2) MEMBERSHIP.—In appointing members to the Personal 

Care Attendants Workforce Advisory Panel, the Secretary shall 

ensure that such members include the following: 

(A) Individuals with disabilities of all ages. 

(B) Senior individuals. 

(C) Representatives of individuals with disabilities. 

(D) Representatives of senior individuals. 

(E) Representatives of workforce and labor organizations. 

(F) Representatives of home and community-based 

service providers. 

(G) Representatives of assisted living providers. 

(d) INCLUSION OF INFORMATION ON SUPPLEMENTAL COVERAGE

IN THE NATIONAL CLEARINGHOUSE FOR LONG-TERM CARE INFORMATION; EXTENSION OF FUNDING.—Section 6021(d) of the Deficit 

Reduction Act of 2005 (42 U.S.C. 1396p note) is amended— 

(1) in paragraph (2)(A)— 

(A) in clause (ii), by striking ‘‘and’’ at the end; 

(B) in clause (iii), by striking the period at the end 

and inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(iv) include information regarding the CLASS program established under title XXXII of the Public 

Health Service Act and coverage available for purchase 

through a Exchange established under section 1311 

of the Patient Protection and Affordable Care Act that 

is supplemental coverage to the benefits provided 

under a CLASS Independence Benefit Plan under that 

program, and information regarding how benefits provided under a CLASS Independence Benefit Plan differ 

from disability insurance benefits.’’; and 

(2) in paragraph (3), by striking ‘‘2010’’ and inserting 

‘‘2015’’. 

(e) EFFECTIVE DATE.—The amendments made by subsections 

(a), (b), and (d) take effect on January 1, 2011. 

(f) RULE OF CONSTRUCTION.—Nothing in this title or the amendments made by this title are intended to replace or displace public 

or private disability insurance benefits, including such benefits 

that are for income replacement. 

TITLE IX—REVENUE PROVISIONS 

Subtitle A—Revenue Offset Provisions 

SEC. 9001. EXCISE TAX ON HIGH COST EMPLOYER-SPONSORED HEALTH 

COVERAGE. 

(a) IN GENERAL.—Chapter 43 of the Internal Revenue Code 

of 1986, as amended by section 1513, is amended by adding at 

the end the following: 
H. R. 3590—730 

‘‘SEC. 4980I. EXCISE TAX ON HIGH COST EMPLOYER-SPONSORED 

HEALTH COVERAGE. 

‘‘(a) IMPOSITION OF TAX.—If— 

‘‘(1) an employee is covered under any applicable employersponsored coverage of an employer at any time during a taxable 

period, and 

‘‘(2) there is any excess benefit with respect to the coverage, 

there is hereby imposed a tax equal to 40 percent of the excess 

benefit. 

‘‘(b) EXCESS BENEFIT.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘excess benefit’ means, with 

respect to any applicable employer-sponsored coverage made 

available by an employer to an employee during any taxable 

period, the sum of the excess amounts determined under paragraph (2) for months during the taxable period. 

‘‘(2) MONTHLY EXCESS AMOUNT.—The excess amount determined under this paragraph for any month is the excess (if 

any) of— 

‘‘(A) the aggregate cost of the applicable employersponsored coverage of the employee for the month, over 

‘‘(B) an amount equal to 1⁄12 of the annual limitation 

under paragraph (3) for the calendar year in which the 

month occurs. 

‘‘(3) ANNUAL LIMITATION.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The annual limitation under this 

paragraph for any calendar year is the dollar limit determined under subparagraph (C) for the calendar year. 

‘‘(B) APPLICABLE ANNUAL LIMITATION.—The annual 

limitation which applies for any month shall be determined 

on the basis of the type of coverage (as determined under 

subsection (f)(1)) provided to the employee by the employer 

as of the beginning of the month. 

‘‘(C) APPLICABLE DOLLAR LIMIT.—Except as provided 

in subparagraph (D)— 

‘‘(i) 2013.—In the case of 2013, the dollar limit 

under this subparagraph is— 

‘‘(I) in the case of an employee with self-only 

coverage, $8,500, and 

‘‘(II) in the case of an employee with coverage 

other than self-only coverage, $23,000. 

‘‘(ii) EXCEPTION FOR CERTAIN INDIVIDUALS.—In the 

case of an individual who is a qualified retiree or 

who participates in a plan sponsored by an employer 

the majority of whose employees are engaged in a 

high-risk profession or employed to repair or install 

electrical or telecommunications lines— 

‘‘(I) the dollar amount in clause (i)(I) (determined after the application of subparagraph (D)) 

shall be increased by $1,350, and 

‘‘(II) the dollar amount in clause (i)(II) (determined after the application of subparagraph (D)) 

shall be increased by $3,000. 

‘‘(iii) SUBSEQUENT YEARS.—In the case of any calendar year after 2013, each of the dollar amounts 

under clauses (i) and (ii) shall be increased to the 

amount equal to such amount as in effect for the 
H. R. 3590—731 

calendar year preceding such year, increased by an 

amount equal to the product of— 

‘‘(I) such amount as so in effect, multiplied 

by 

‘‘(II) the cost-of-living adjustment determined 

under section 1(f)(3) for such year (determined by 

substituting the calendar year that is 2 years 

before such year for ‘1992’ in subparagraph (B) 

thereof), increased by 1 percentage point. 

If any amount determined under this clause is not 

a multiple of $50, such amount shall be rounded to 

the nearest multiple of $50. 

‘‘(D) TRANSITION RULE FOR STATES WITH HIGHEST COVERAGE COSTS.— 

‘‘(i) IN GENERAL.—If an employee is a resident 

of a high cost State on the first day of any month 

beginning in 2013, 2014, or 2015, the annual limitation 

under this paragraph for such month with respect 

to such employee shall be an amount equal to the 

applicable percentage of the annual limitation (determined without regard to this subparagraph or subparagraph (C)(ii)). 

‘‘(ii) APPLICABLE PERCENTAGE.—The applicable 

percentage is 120 percent for 2013, 110 percent for 

2014, and 105 percent for 2015. 

‘‘(iii) HIGH COST STATE.—The term ‘high cost State’ 

means each of the 17 States which the Secretary of 

Health and Human Services, in consultation with the 

Secretary, estimates had the highest average cost 

during 2012 for employer-sponsored coverage under 

health plans. The Secretary’s estimate shall be made 

on the basis of aggregate premiums paid in the State 

for such health plans, determined using the most 

recent data available as of August 31, 2012. 

‘‘(c) LIABILITY TO PAY TAX.— ‘‘(1) IN GENERAL.—Each coverage provider shall pay the 

tax imposed by subsection (a) on its applicable share of the 

excess benefit with respect to an employee for any taxable 

period. 

‘‘(2) COVERAGE PROVIDER.—For purposes of this subsection, 

the term ‘coverage provider’ means each of the following: 

‘‘(A) HEALTH INSURANCE COVERAGE.—If the applicable 

employer-sponsored coverage consists of coverage under a 

group health plan which provides health insurance coverage, the health insurance issuer. 

‘‘(B) HSA AND MSA CONTRIBUTIONS.—If the applicable 

employer-sponsored coverage consists of coverage under an 

arrangement under which the employer makes contributions described in subsection (b) or (d) of section 106, the 

employer. 

‘‘(C) OTHER COVERAGE.—In the case of any other 

applicable employer-sponsored coverage, the person that 

administers the plan benefits. 

‘‘(3) APPLICABLE SHARE.—For purposes of this subsection, 

a coverage provider’s applicable share of an excess benefit for 

any taxable period is the amount which bears the same ratio 

to the amount of such excess benefit as— 
H. R. 3590—732 

‘‘(A) the cost of the applicable employer-sponsored coverage provided by the provider to the employee during 

such period, bears to 

‘‘(B) the aggregate cost of all applicable employer-sponsored coverage provided to the employee by all coverage 

providers during such period. 

‘‘(4) RESPONSIBILITY TO CALCULATE TAX AND APPLICABLE

SHARES.— 

‘‘(A) IN GENERAL.—Each employer shall— 

‘‘(i) calculate for each taxable period the amount 

of the excess benefit subject to the tax imposed by 

subsection (a) and the applicable share of such excess 

benefit for each coverage provider, and 

‘‘(ii) notify, at such time and in such manner as 

the Secretary may prescribe, the Secretary and each 

coverage provider of the amount so determined for 

the provider. 

‘‘(B) SPECIAL RULE FOR MULTIEMPLOYER PLANS.—In the 

case of applicable employer-sponsored coverage made available to employees through a multiemployer plan (as defined 

in section 414(f)), the plan sponsor shall make the calculations, and provide the notice, required under subparagraph 

(A). 

‘‘(d) APPLICABLE EMPLOYER-SPONSORED COVERAGE; COST.—For 

purposes of this section— 

‘‘(1) APPLICABLE EMPLOYER-SPONSORED COVERAGE.— 

‘‘(A) IN GENERAL.—The term ‘applicable employer-sponsored coverage’ means, with respect to any employee, coverage under any group health plan made available to the 

employee by an employer which is excludable from the 

employee’s gross income under section 106, or would be 

so excludable if it were employer-provided coverage (within 

the meaning of such section 106). 

‘‘(B) EXCEPTIONS.—The term ‘applicable employer-sponsored coverage’ shall not include— 

‘‘(i) any coverage (whether through insurance or 

otherwise) described in section 9832(c)(1)(A) or for longterm care, or 

‘‘(ii) any coverage described in section 9832(c)(3) 

the payment for which is not excludable from gross 

income and for which a deduction under section 162(l) 

is not allowable. 

‘‘(C) COVERAGE INCLUDES EMPLOYEE PAID PORTION.— 

Coverage shall be treated as applicable employer-sponsored 

coverage without regard to whether the employer or 

employee pays for the coverage. 

‘‘(D) SELF-EMPLOYED INDIVIDUAL.—In the case of an 

individual who is an employee within the meaning of section 401(c)(1), coverage under any group health plan providing health insurance coverage shall be treated as 

applicable employer-sponsored coverage if a deduction is 

allowable under section 162(l) with respect to all or any 

portion of the cost of the coverage. 

‘‘(E) GOVERNMENTAL PLANS INCLUDED.—Applicable 

employer-sponsored coverage shall include coverage under 

any group health plan established and maintained primarily for its civilian employees by the Government of 
H. R. 3590—733 

the United States, by the government of any State or 

political subdivision thereof, or by any agency or instrumentality of any such government. 

‘‘(2) DETERMINATION OF COST.— 

‘‘(A) IN GENERAL.—The cost of applicable employersponsored coverage shall be determined under rules similar 

to the rules of section 4980B(f)(4), except that in determining such cost, any portion of the cost of such coverage 

which is attributable to the tax imposed under this section 

shall not be taken into account and the amount of such 

cost shall be calculated separately for self-only coverage 

and other coverage. In the case of applicable employersponsored coverage which provides coverage to retired 

employees, the plan may elect to treat a retired employee 

who has not attained the age of 65 and a retired employee 

who has attained the age of 65 as similarly situated beneficiaries. 

‘‘(B) HEALTH FSAS.—In the case of applicable employersponsored coverage consisting of coverage under a flexible 

spending arrangement (as defined in section 106(c)(2)), the 

cost of the coverage shall be equal to the sum of— 

‘‘(i) the amount of employer contributions under 

any salary reduction election under the arrangement, 

plus 

‘‘(ii) the amount determined under subparagraph 

(A) with respect to any reimbursement under the 

arrangement in excess of the contributions described 

in clause (i). 

‘‘(C) ARCHER MSAS AND HSAS.—In the case of applicable 

employer-sponsored coverage consisting of coverage under 

an arrangement under which the employer makes contributions described in subsection (b) or (d) of section 106, the 

cost of the coverage shall be equal to the amount of 

employer contributions under the arrangement. 

‘‘(D) ALLOCATION ON A MONTHLY BASIS.—If cost is determined on other than a monthly basis, the cost shall be 

allocated to months in a taxable period on such basis 

as the Secretary may prescribe. 

‘‘(e) PENALTY FOR FAILURE TO PROPERLY CALCULATE EXCESS

BENEFIT.— 

‘‘(1) IN GENERAL.—If, for any taxable period, the tax 

imposed by subsection (a) exceeds the tax determined under 

such subsection with respect to the total excess benefit calculated by the employer or plan sponsor under subsection 

(c)(4)— 

‘‘(A) each coverage provider shall pay the tax on its 

applicable share (determined in the same manner as under 

subsection (c)(4)) of the excess, but no penalty shall be 

imposed on the provider with respect to such amount, 

and 

‘‘(B) the employer or plan sponsor shall, in addition 

to any tax imposed by subsection (a), pay a penalty in 

an amount equal to such excess, plus interest at the underpayment rate determined under section 6621 for the period 

beginning on the due date for the payment of tax imposed 

by subsection (a) to which the excess relates and ending 

on the date of payment of the penalty. 
H. R. 3590—734 

‘‘(2) LIMITATIONS ON PENALTY.— 

‘‘(A) PENALTY NOT TO APPLY WHERE FAILURE NOT

DISCOVERED EXERCISING REASONABLE DILIGENCE.—No penalty shall be imposed by paragraph (1)(B) on any failure 

to properly calculate the excess benefit during any period 

for which it is established to the satisfaction of the Secretary that the employer or plan sponsor neither knew, 

nor exercising reasonable diligence would have known, that 

such failure existed. 

‘‘(B) PENALTY NOT TO APPLY TO FAILURES CORRECTED

WITHIN 30 DAYS.—No penalty shall be imposed by paragraph 

(1)(B) on any such failure if— 

‘‘(i) such failure was due to reasonable cause and 

not to willful neglect, and 

‘‘(ii) such failure is corrected during the 30-day 

period beginning on the 1st date that the employer 

knew, or exercising reasonable diligence would have 

known, that such failure existed. 

‘‘(C) WAIVER BY SECRETARY.—In the case of any such 

failure which is due to reasonable cause and not to willful 

neglect, the Secretary may waive part or all of the penalty 

imposed by paragraph (1), to the extent that the payment 

of such penalty would be excessive or otherwise inequitable 

relative to the failure involved. 

‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.—For purposes 

of this section— 

‘‘(1) COVERAGE DETERMINATIONS.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph 

(B), an employee shall be treated as having self-only coverage with respect to any applicable employer-sponsored 

coverage of an employer. 

‘‘(B) MINIMUM ESSENTIAL COVERAGE.—An employee 

shall be treated as having coverage other than self-only 

coverage only if the employee is enrolled in coverage other 

than self-only coverage in a group health plan which provides minimum essential coverage (as defined in section 

5000A(f)) to the employee and at least one other beneficiary, 

and the benefits provided under such minimum essential 

coverage do not vary based on whether any individual 

covered under such coverage is the employee or another 

beneficiary. 

‘‘(2) QUALIFIED RETIREE.—The term ‘qualified retiree’ 

means any individual who— 

‘‘(A) is receiving coverage by reason of being a retiree, 

‘‘(B) has attained age 55, and 

‘‘(C) is not entitled to benefits or eligible for enrollment 

under the Medicare program under title XVIII of the Social 

Security Act. 

‘‘(3) EMPLOYEES ENGAGED IN HIGH-RISK PROFESSION.—The 

term ‘employees engaged in a high-risk profession’ means law 

enforcement officers (as such term is defined in section 1204 

of the Omnibus Crime Control and Safe Streets Act of 1968), 

employees in fire protection activities (as such term is defined 

in section 3(y) of the Fair Labor Standards Act of 1938), individuals who provide out-of-hospital emergency medical care 

(including emergency medical technicians, paramedics, and 

first-responders), and individuals engaged in the construction, 
H. R. 3590—735 

mining, agriculture (not including food processing), forestry, 

and fishing industries. Such term includes an employee who 

is retired from a high-risk profession described in the preceding 

sentence, if such employee satisfied the requirements of such 

sentence for a period of not less than 20 years during the 

employee’s employment. 

‘‘(4) GROUP HEALTH PLAN.—The term ‘group health plan’ 

has the meaning given such term by section 5000(b)(1). 

‘‘(5) HEALTH INSURANCE COVERAGE; HEALTH INSURANCE

ISSUER.— 

‘‘(A) HEALTH INSURANCE COVERAGE.—The term ‘health 

insurance coverage’ has the meaning given such term by 

section 9832(b)(1) (applied without regard to subparagraph 

(B) thereof, except as provided by the Secretary in regulations). 

‘‘(B) HEALTH INSURANCE ISSUER.—The term ‘health 

insurance issuer’ has the meaning given such term by 

section 9832(b)(2). 

‘‘(6) PERSON THAT ADMINISTERS THE PLAN BENEFITS.—The 

term ‘person that administers the plan benefits’ shall include 

the plan sponsor if the plan sponsor administers benefits under 

the plan. 

‘‘(7) PLAN SPONSOR.—The term ‘plan sponsor’ has the 

meaning given such term in section 3(16)(B) of the Employee 

Retirement Income Security Act of 1974. 

‘‘(8) TAXABLE PERIOD.—The term ‘taxable period’ means 

the calendar year or such shorter period as the Secretary may 

prescribe. The Secretary may have different taxable periods 

for employers of varying sizes. 

‘‘(9) AGGREGATION RULES.—All employers treated as a 

single employer under subsection (b), (c), (m), or (o) of section 

414 shall be treated as a single employer. 

‘‘(10) DENIAL OF DEDUCTION.—For denial of a deduction 

for the tax imposed by this section, see section 275(a)(6). 

‘‘(g) REGULATIONS.—The Secretary shall prescribe such regulations as may be necessary to carry out this section.’’. 

(b) CLERICAL AMENDMENT.—The table of sections for chapter 

43 of such Code, as amended by section 1513, is amended by 

adding at the end the following new item: 

‘‘Sec. 4980I. Excise tax on high cost employer-sponsored health coverage.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2012. 

SEC. 9002. INCLUSION OF COST OF EMPLOYER-SPONSORED HEALTH 

COVERAGE ON W–2. 

(a) IN GENERAL.—Section 6051(a) of the Internal Revenue Code 

of 1986 (relating to receipts for employees) is amended by striking 

‘‘and’’ at the end of paragraph (12), by striking the period at the 

end of paragraph (13) and inserting ‘‘, and’’, and by adding after 

paragraph (13) the following new paragraph: 

‘‘(14) the aggregate cost (determined under rules similar 

to the rules of section 4980B(f)(4)) of applicable employer-sponsored coverage (as defined in section 4980I(d)(1)), except that 

this paragraph shall not apply to— 

‘‘(A) coverage to which paragraphs (11) and (12) apply, 

or 
H. R. 3590—736 

‘‘(B) the amount of any salary reduction contributions 

to a flexible spending arrangement (within the meaning 

of section 125).’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2010. 

SEC. 9003. DISTRIBUTIONS FOR MEDICINE QUALIFIED ONLY IF FOR 

PRESCRIBED DRUG OR INSULIN. 

(a) HSAS.—Subparagraph (A) of section 223(d)(2) of the Internal 

Revenue Code of 1986 is amended by adding at the end the following: ‘‘Such term shall include an amount paid for medicine 

or a drug only if such medicine or drug is a prescribed drug 

(determined without regard to whether such drug is available without a prescription) or is insulin.’’. 

(b) ARCHER MSAS.—Subparagraph (A) of section 220(d)(2) of 

the Internal Revenue Code of 1986 is amended by adding at the 

end the following: ‘‘Such term shall include an amount paid for 

medicine or a drug only if such medicine or drug is a prescribed 

drug (determined without regard to whether such drug is available 

without a prescription) or is insulin.’’. 

(c) HEALTH FLEXIBLE SPENDING ARRANGEMENTS AND HEALTH

REIMBURSEMENT ARRANGEMENTS.—Section 106 of the Internal Revenue Code of 1986 is amended by adding at the end the following 

new subsection: 

‘‘(f) REIMBURSEMENTS FOR MEDICINE RESTRICTED TO PRESCRIBED DRUGS AND INSULIN.—For purposes of this section and 

section 105, reimbursement for expenses incurred for a medicine 

or a drug shall be treated as a reimbursement for medical expenses 

only if such medicine or drug is a prescribed drug (determined 

without regard to whether such drug is available without a prescription) or is insulin.’’. 

(d) EFFECTIVE DATES.— (1) DISTRIBUTIONS FROM SAVINGS ACCOUNTS.—The amendments made by subsections (a) and (b) shall apply to amounts 

paid with respect to taxable years beginning after December 

31, 2010. 

(2) REIMBURSEMENTS.—The amendment made by subsection (c) shall apply to expenses incurred with respect to 

taxable years beginning after December 31, 2010. 

SEC. 9004. INCREASE IN ADDITIONAL TAX ON DISTRIBUTIONS FROM 

HSAS AND ARCHER MSAS NOT USED FOR QUALIFIED 

MEDICAL EXPENSES. 

(a) HSAS.—Section 223(f)(4)(A) of the Internal Revenue Code 

of 1986 is amended by striking ‘‘10 percent’’ and inserting ‘‘20 

percent’’. 

(b) ARCHER MSAS.—Section 220(f)(4)(A) of the Internal Revenue 

Code of 1986 is amended by striking ‘‘15 percent’’ and inserting 

‘‘20 percent’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to distributions made after December 31, 2010. 

SEC. 9005. LIMITATION ON HEALTH FLEXIBLE SPENDING ARRANGEMENTS UNDER CAFETERIA PLANS. 

(a) IN GENERAL.—Section 125 of the Internal Revenue Code 

of 1986 is amended— 

(1) by redesignating subsections (i) and (j) as subsections 

(j) and (k), respectively, and 
H. R. 3590—737 

(2) by inserting after subsection (h) the following new subsection: 

‘‘(i) LIMITATION ON HEALTH FLEXIBLE SPENDING ARRANGE- MENTS.—For purposes of this section, if a benefit is provided under 

a cafeteria plan through employer contributions to a health flexible 

spending arrangement, such benefit shall not be treated as a qualified benefit unless the cafeteria plan provides that an employee 

may not elect for any taxable year to have salary reduction contributions in excess of $2,500 made to such arrangement.’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2010. 

SEC. 9006. EXPANSION OF INFORMATION REPORTING REQUIREMENTS. 

(a) IN GENERAL.—Section 6041 of the Internal Revenue Code 

of 1986 is amended by adding at the end the following new subsections: 

‘‘(h) APPLICATION TO CORPORATIONS.—Notwithstanding any 

regulation prescribed by the Secretary before the date of the enactment of this subsection, for purposes of this section the term ‘person’ 

includes any corporation that is not an organization exempt from 

tax under section 501(a). 

‘‘(i) REGULATIONS.—The Secretary may prescribe such regulations and other guidance as may be appropriate or necessary to 

carry out the purposes of this section, including rules to prevent 

duplicative reporting of transactions.’’. 

(b) PAYMENTS FOR PROPERTY AND OTHER GROSS PROCEEDS.— Subsection (a) of section 6041 of the Internal Revenue Code of 

1986 is amended— 

(1) by inserting ‘‘amounts in consideration for property,’’ 

after ‘‘wages,’’, 

(2) by inserting ‘‘gross proceeds,’’ after ‘‘emoluments, or 

other’’, and 

(3) by inserting ‘‘gross proceeds,’’ after ‘‘setting forth the 

amount of such’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to payments made after December 31, 2011. 

SEC. 9007. ADDITIONAL REQUIREMENTS FOR CHARITABLE HOSPITALS. 

(a) REQUIREMENTS TO QUALIFY AS SECTION 501(C)(3) CHARI- TABLE HOSPITAL ORGANIZATION.—Section 501 of the Internal Revenue Code of 1986 (relating to exemption from tax on corporations, 

certain trusts, etc.) is amended by redesignating subsection (r) 

as subsection (s) and by inserting after subsection (q) the following 

new subsection: 

‘‘(r) ADDITIONAL REQUIREMENTS FOR CERTAIN HOSPITALS.— ‘‘(1) IN GENERAL.—A hospital organization to which this 

subsection applies shall not be treated as described in subsection (c)(3) unless the organization— 

‘‘(A) meets the community health needs assessment 

requirements described in paragraph (3), 

‘‘(B) meets the financial assistance policy requirements 

described in paragraph (4), 

‘‘(C) meets the requirements on charges described in 

paragraph (5), and 

‘‘(D) meets the billing and collection requirement 

described in paragraph (6). 

‘‘(2) HOSPITAL ORGANIZATIONS TO WHICH SUBSECTION

APPLIES.— 
H. R. 3590—738 

‘‘(A) IN GENERAL.—This subsection shall apply to— 

‘‘(i) an organization which operates a facility which 

is required by a State to be licensed, registered, or 

similarly recognized as a hospital, and 

‘‘(ii) any other organization which the Secretary 

determines has the provision of hospital care as its 

principal function or purpose constituting the basis 

for its exemption under subsection (c)(3) (determined 

without regard to this subsection). 

‘‘(B) ORGANIZATIONS WITH MORE THAN 1 HOSPITAL

FACILITY.—If a hospital organization operates more than 

1 hospital facility— 

‘‘(i) the organization shall meet the requirements 

of this subsection separately with respect to each such 

facility, and 

‘‘(ii) the organization shall not be treated as 

described in subsection (c)(3) with respect to any such 

facility for which such requirements are not separately 

met. 

‘‘(3) COMMUNITY HEALTH NEEDS ASSESSMENTS.— 

‘‘(A) IN GENERAL.—An organization meets the requirements of this paragraph with respect to any taxable year 

only if the organization— 

‘‘(i) has conducted a community health needs 

assessment which meets the requirements of subparagraph (B) in such taxable year or in either of the 

2 taxable years immediately preceding such taxable 

year, and 

‘‘(ii) has adopted an implementation strategy to 

meet the community health needs identified through 

such assessment. 

‘‘(B) COMMUNITY HEALTH NEEDS ASSESSMENT.—A 

community health needs assessment meets the requirements of this paragraph if such community health needs 

assessment— 

‘‘(i) takes into account input from persons who 

represent the broad interests of the community served 

by the hospital facility, including those with special 

knowledge of or expertise in public health, and 

‘‘(ii) is made widely available to the public. 

‘‘(4) FINANCIAL ASSISTANCE POLICY.—An organization meets 

the requirements of this paragraph if the organization establishes the following policies: 

‘‘(A) FINANCIAL ASSISTANCE POLICY.—A written financial assistance policy which includes— 

‘‘(i) eligibility criteria for financial assistance, and 

whether such assistance includes free or discounted 

care, 

‘‘(ii) the basis for calculating amounts charged to 

patients, 

‘‘(iii) the method for applying for financial assistance, 

‘‘(iv) in the case of an organization which does 

not have a separate billing and collections policy, the 

actions the organization may take in the event of nonpayment, including collections action and reporting to 

credit agencies, and 
H. R. 3590—739 

‘‘(v) measures to widely publicize the policy within 

the community to be served by the organization. 

‘‘(B) POLICY RELATING TO EMERGENCY MEDICAL CARE.— 

A written policy requiring the organization to provide, without discrimination, care for emergency medical conditions 

(within the meaning of section 1867 of the Social Security 

Act (42 U.S.C. 1395dd)) to individuals regardless of their 

eligibility under the financial assistance policy described 

in subparagraph (A). 

‘‘(5) LIMITATION ON CHARGES.—An organization meets the 

requirements of this paragraph if the organization— 

‘‘(A) limits amounts charged for emergency or other 

medically necessary care provided to individuals eligible 

for assistance under the financial assistance policy 

described in paragraph (4)(A) to not more than the lowest 

amounts charged to individuals who have insurance covering such care, and 

‘‘(B) prohibits the use of gross charges. 

‘‘(6) BILLING AND COLLECTION REQUIREMENTS.—An 

organization meets the requirement of this paragraph only 

if the organization does not engage in extraordinary collection 

actions before the organization has made reasonable efforts 

to determine whether the individual is eligible for assistance 

under the financial assistance policy described in paragraph 

(4)(A). 

‘‘(7) REGULATORY AUTHORITY.—The Secretary shall issue 

such regulations and guidance as may be necessary to carry 

out the provisions of this subsection, including guidance relating 

to what constitutes reasonable efforts to determine the eligibility of a patient under a financial assistance policy for purposes of paragraph (6).’’. 

(b) EXCISE TAX FOR FAILURES TO MEET HOSPITAL EXEMPTION

REQUIREMENTS.— (1) IN GENERAL.—Subchapter D of chapter 42 of the 

Internal Revenue Code of 1986 (relating to failure by certain 

charitable organizations to meet certain qualification requirements) is amended by adding at the end the following new 

section: 

‘‘SEC. 4959. TAXES ON FAILURES BY HOSPITAL ORGANIZATIONS. 

‘‘If a hospital organization to which section 501(r) applies fails 

to meet the requirement of section 501(r)(3) for any taxable year, 

there is imposed on the organization a tax equal to $50,000.’’. 

(2) CONFORMING AMENDMENT.—The table of sections for 

subchapter D of chapter 42 of such Code is amended by adding 

at the end the following new item: 

‘‘Sec. 4959. Taxes on failures by hospital organizations.’’. 

(c) MANDATORY REVIEW OF TAX EXEMPTION FOR HOSPITALS.— The Secretary of the Treasury or the Secretary’s delegate shall 

review at least once every 3 years the community benefit activities 

of each hospital organization to which section 501(r) of the Internal 

Revenue Code of 1986 (as added by this section) applies. 

(d) ADDITIONAL REPORTING REQUIREMENTS.— 

(1) COMMUNITY HEALTH NEEDS ASSESSMENTS AND AUDITED

FINANCIAL STATEMENTS.—Section 6033(b) of the Internal Revenue Code of 1986 (relating to certain organizations described 

in section 501(c)(3)) is amended by striking ‘‘and’’ at the end 
H. R. 3590—740 

of paragraph (14), by redesignating paragraph (15) as paragraph (16), and by inserting after paragraph (14) the following 

new paragraph: 

‘‘(15) in the case of an organization to which the requirements of section 501(r) apply for the taxable year— 

‘‘(A) a description of how the organization is addressing 

the needs identified in each community health needs 

assessment conducted under section 501(r)(3) and a description of any such needs that are not being addressed 

together with the reasons why such needs are not being 

addressed, and 

‘‘(B) the audited financial statements of such organization (or, in the case of an organization the financial statements of which are included in a consolidated financial 

statement with other organizations, such consolidated 

financial statement).’’. 

(2) TAXES.—Section 6033(b)(10) of such Code is amended 

by striking ‘‘and’’ at the end of subparagraph (B), by inserting 

‘‘and’’ at the end of subparagraph (C), and by adding at the 

end the following new subparagraph: 

‘‘(D) section 4959 (relating to taxes on failures by hospital organizations),’’. 

(e) REPORTS.— 

(1) REPORT ON LEVELS OF CHARITY CARE.—The Secretary 

of the Treasury, in consultation with the Secretary of Health 

and Human Services, shall submit to the Committees on Ways 

and Means, Education and Labor, and Energy and Commerce 

of the House of Representatives and to the Committees on 

Finance and Health, Education, Labor, and Pensions of the 

Senate an annual report on the following: 

(A) Information with respect to private tax-exempt, 

taxable, and government-owned hospitals regarding— 

(i) levels of charity care provided, 

(ii) bad debt expenses, 

(iii) unreimbursed costs for services provided with 

respect to means-tested government programs, and 

(iv) unreimbursed costs for services provided with 

respect to non-means tested government programs. 

(B) Information with respect to private tax-exempt hospitals regarding costs incurred for community benefit activities. 

(2) REPORT ON TRENDS.— 

(A) STUDY.—The Secretary of the Treasury, in consultation with the Secretary of Health and Human Services, 

shall conduct a study on trends in the information required 

to be reported under paragraph (1). 

(B) REPORT.—Not later than 5 years after the date 

of the enactment of this Act, the Secretary of the Treasury, 

in consultation with the Secretary of Health and Human 

Services, shall submit a report on the study conducted 

under subparagraph (A) to the Committees on Ways and 

Means, Education and Labor, and Energy and Commerce 

of the House of Representatives and to the Committees 

on Finance and Health, Education, Labor, and Pensions 

of the Senate. 

(f) EFFECTIVE DATES.— 
H. R. 3590—741 

(1) IN GENERAL.—Except as provided in paragraphs (2) 

and (3), the amendments made by this section shall apply 

to taxable years beginning after the date of the enactment 

of this Act. 

(2) COMMUNITY HEALTH NEEDS ASSESSMENT.—The requirements of section 501(r)(3) of the Internal Revenue Code of 

1986, as added by subsection (a), shall apply to taxable years 

beginning after the date which is 2 years after the date of 

the enactment of this Act. 

(3) EXCISE TAX.—The amendments made by subsection (b) 

shall apply to failures occurring after the date of the enactment 

of this Act. 

SEC. 9008. IMPOSITION OF ANNUAL FEE ON BRANDED PRESCRIPTION 

PHARMACEUTICAL MANUFACTURERS AND IMPORTERS. 

(a) IMPOSITION OF FEE.— 

(1) IN GENERAL.—Each covered entity engaged in the business of manufacturing or importing branded prescription drugs 

shall pay to the Secretary of the Treasury not later than the 

annual payment date of each calendar year beginning after 

2009 a fee in an amount determined under subsection (b). 

(2) ANNUAL PAYMENT DATE.—For purposes of this section, 

the term ‘‘annual payment date’’ means with respect to any 

calendar year the date determined by the Secretary, but in 

no event later than September 30 of such calendar year. 

(b) DETERMINATION OF FEE AMOUNT.— 

(1) IN GENERAL.—With respect to each covered entity, the 

fee under this section for any calendar year shall be equal 

to an amount that bears the same ratio to $2,300,000,000 

as— 

(A) the covered entity’s branded prescription drug sales 

taken into account during the preceding calendar year, 

bear to 

(B) the aggregate branded prescription drug sales of 

all covered entities taken into account during such preceding calendar year. 

(2) SALES TAKEN INTO ACCOUNT.—For purposes of paragraph (1), the branded prescription drug sales taken into 

account during any calendar year with respect to any covered 

entity shall be determined in accordance with the following 

table: 

With respect to a covered entity’s aggregate 

branded prescription drug sales during the 

calendar year that are: 

The percentage of 

such sales taken 

into account is: 

Not more than $5,000,000 ....................... 0 percent 

More than $5,000,000 but not more than 

$125,000,000.

10 percent 

More than $125,000,000 but not more 

than $225,000,000.

40 percent 

More than $225,000,000 but not more 

than $400,000,000.

75 percent 

More than $400,000,000 ........................... 100 percent. 
H. R. 3590—742 

(3) SECRETARIAL DETERMINATION.—The Secretary of the 

Treasury shall calculate the amount of each covered entity’s 

fee for any calendar year under paragraph (1). In calculating 

such amount, the Secretary of the Treasury shall determine 

such covered entity’s branded prescription drug sales on the 

basis of reports submitted under subsection (g) and through 

the use of any other source of information available to the 

Secretary of the Treasury. 

(c) TRANSFER OF FEES TO MEDICARE PART B TRUST FUND.— 

There is hereby appropriated to the Federal Supplementary Medical 

Insurance Trust Fund established under section 1841 of the Social 

Security Act an amount equal to the fees received by the Secretary 

of the Treasury under subsection (a). 

(d) COVERED ENTITY.— 

(1) IN GENERAL.—For purposes of this section, the term 

‘‘covered entity’’ means any manufacturer or importer with 

gross receipts from branded prescription drug sales. 

(2) CONTROLLED GROUPS.— 

(A) IN GENERAL.—For purposes of this subsection, all 

persons treated as a single employer under subsection (a) 

or (b) of section 52 of the Internal Revenue Code of 1986 

or subsection (m) or (o) of section 414 of such Code shall 

be treated as a single covered entity. 

(B) INCLUSION OF FOREIGN CORPORATIONS.—For purposes of subparagraph (A), in applying subsections (a) and 

(b) of section 52 of such Code to this section, section 1563 

of such Code shall be applied without regard to subsection 

(b)(2)(C) thereof. 

(e) BRANDED PRESCRIPTION DRUG SALES.—For purposes of this 

section— 

(1) IN GENERAL.—The term ‘‘branded prescription drug 

sales’’ means sales of branded prescription drugs to any specified government program or pursuant to coverage under any 

such program. 

(2) BRANDED PRESCRIPTION DRUGS.— (A) IN GENERAL.—The term ‘‘branded prescription 

drug’’ means— 

(i) any prescription drug the application for which 

was submitted under section 505(b) of the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 355(b)), or 

(ii) any biological product the license for which 

was submitted under section 351(a) of the Public 

Health Service Act (42 U.S.C. 262(a)). 

(B) PRESCRIPTION DRUG.—For purposes of subparagraph (A)(i), the term ‘‘prescription drug’’ means any drug 

which is subject to section 503(b) of the Federal Food, 

Drug, and Cosmetic Act (21 U.S.C. 353(b)). 

(3) EXCLUSION OF ORPHAN DRUG SALES.—The term ‘‘branded 

prescription drug sales’’ shall not include sales of any drug 

or biological product with respect to which a credit was allowed 

for any taxable year under section 45C of the Internal Revenue 

Code of 1986. The preceding sentence shall not apply with 

respect to any such drug or biological product after the date 

on which such drug or biological product is approved by the 

Food and Drug Administration for marketing for any indication 

other than the treatment of the rare disease or condition with 

respect to which such credit was allowed. 
H. R. 3590—743 

(4) SPECIFIED GOVERNMENT PROGRAM.—The term ‘‘specified 

government program’’ means— 

(A) the Medicare Part D program under part D of 

title XVIII of the Social Security Act, 

(B) the Medicare Part B program under part B of 

title XVIII of the Social Security Act, 

(C) the Medicaid program under title XIX of the Social 

Security Act, 

(D) any program under which branded prescription 

drugs are procured by the Department of Veterans Affairs, 

(E) any program under which branded prescription 

drugs are procured by the Department of Defense, or 

(F) the TRICARE retail pharmacy program under section 1074g of title 10, United States Code. 

(f) TAX TREATMENT OF FEES.—The fees imposed by this section— 

(1) for purposes of subtitle F of the Internal Revenue Code 

of 1986, shall be treated as excise taxes with respect to which 

only civil actions for refund under procedures of such subtitle 

shall apply, and 

(2) for purposes of section 275 of such Code, shall be considered to be a tax described in section 275(a)(6). 

(g) REPORTING REQUIREMENT.—Not later than the date determined by the Secretary of the Treasury following the end of any 

calendar year, the Secretary of Health and Human Services, the 

Secretary of Veterans Affairs, and the Secretary of Defense shall 

report to the Secretary of the Treasury, in such manner as the 

Secretary of the Treasury prescribes, the total branded prescription 

drug sales for each covered entity with respect to each specified 

government program under such Secretary’s jurisdiction using the 

following methodology: 

(1) MEDICARE PART D PROGRAM.—The Secretary of Health 

and Human Services shall report, for each covered entity and 

for each branded prescription drug of the covered entity covered 

by the Medicare Part D program, the product of— 

(A) the per-unit ingredient cost, as reported to the 

Secretary of Health and Human Services by prescription 

drug plans and Medicare Advantage prescription drug 

plans, minus any per-unit rebate, discount, or other price 

concession provided by the covered entity, as reported to 

the Secretary of Health and Human Services by the 

prescription drug plans and Medicare Advantage prescription drug plans, and 

(B) the number of units of the branded prescription 

drug paid for under the Medicare Part D program. 

(2) MEDICARE PART B PROGRAM.—The Secretary of Health 

and Human Services shall report, for each covered entity and 

for each branded prescription drug of the covered entity covered 

by the Medicare Part B program under section 1862(a) of the 

Social Security Act, the product of— 

(A) the per-unit average sales price (as defined in 

section 1847A(c) of the Social Security Act) or the perunit Part B payment rate for a separately paid branded 

prescription drug without a reported average sales price, 

and 

(B) the number of units of the branded prescription 

drug paid for under the Medicare Part B program. 
H. R. 3590—744 

The Centers for Medicare and Medicaid Services shall establish 

a process for determining the units and the allocated price 

for purposes of this section for those branded prescription drugs 

that are not separately payable or for which National Drug 

Codes are not reported. 

(3) MEDICAID PROGRAM.—The Secretary of Health and 

Human Services shall report, for each covered entity and for 

each branded prescription drug of the covered entity covered 

under the Medicaid program, the product of— 

(A) the per-unit ingredient cost paid to pharmacies 

by States for the branded prescription drug dispensed to 

Medicaid beneficiaries, minus any per-unit rebate paid by 

the covered entity under section 1927 of the Social Security 

Act and any State supplemental rebate, and 

(B) the number of units of the branded prescription 

drug paid for under the Medicaid program. 

(4) DEPARTMENT OF VETERANS AFFAIRS PROGRAMS.—The 

Secretary of Veterans Affairs shall report, for each covered 

entity and for each branded prescription drug of the covered 

entity the total amount paid for each such branded prescription 

drug procured by the Department of Veterans Affairs for its 

beneficiaries. 

(5) DEPARTMENT OF DEFENSE PROGRAMS AND TRICARE.— 

The Secretary of Defense shall report, for each covered entity 

and for each branded prescription drug of the covered entity, 

the sum of— 

(A) the total amount paid for each such branded 

prescription drug procured by the Department of Defense 

for its beneficiaries, and 

(B) for each such branded prescription drug dispensed 

under the TRICARE retail pharmacy program, the product 

of— 

(i) the per-unit ingredient cost, minus any perunit rebate paid by the covered entity, and 

(ii) the number of units of the branded prescription 

drug dispensed under such program. 

(h) SECRETARY.—For purposes of this section, the term ‘‘Secretary’’ includes the Secretary’s delegate. 

(i) GUIDANCE.—The Secretary of the Treasury shall publish 

guidance necessary to carry out the purposes of this section. 

(j) APPLICATION OF SECTION.—This section shall apply to any 

branded prescription drug sales after December 31, 2008. 

(k) CONFORMING AMENDMENT.—Section 1841(a) of the Social 

Security Act is amended by inserting ‘‘or section 9008(c) of the 

Patient Protection and Affordable Care Act of 2009’’ after ‘‘this 

part’’. 

SEC. 9009. IMPOSITION OF ANNUAL FEE ON MEDICAL DEVICE MANUFACTURERS AND IMPORTERS. 

(a) IMPOSITION OF FEE.— 

(1) IN GENERAL.—Each covered entity engaged in the business of manufacturing or importing medical devices shall pay 

to the Secretary not later than the annual payment date of 

each calendar year beginning after 2009 a fee in an amount 

determined under subsection (b). 

(2) ANNUAL PAYMENT DATE.—For purposes of this section, 

the term ‘‘annual payment date’’ means with respect to any 
H. R. 3590—745 

calendar year the date determined by the Secretary, but in 

no event later than September 30 of such calendar year. 

(b) DETERMINATION OF FEE AMOUNT.— (1) IN GENERAL.—With respect to each covered entity, the 

fee under this section for any calendar year shall be equal 

to an amount that bears the same ratio to $2,000,000,000 

as— 

(A) the covered entity’s gross receipts from medical 

device sales taken into account during the preceding calendar year, bear to 

(B) the aggregate gross receipts of all covered entities 

from medical device sales taken into account during such 

preceding calendar year. 

(2) GROSS RECEIPTS FROM SALES TAKEN INTO ACCOUNT.— For purposes of paragraph (1), the gross receipts from medical 

device sales taken into account during any calendar year with 

respect to any covered entity shall be determined in accordance 

with the following table: 

With respect to a covered entity’s aggregate 

gross receipts from medical device sales during the calendar year that are: 

The percentage of 

gross receipts taken 

into account is: 

Not more than $5,000,000 ....................... 0 percent 

More than $5,000,000 but not more than 

$25,000,000.

50 percent 

More than $25,000,000 ............................. 100 percent. 

(3) SECRETARIAL DETERMINATION.—The Secretary shall calculate the amount of each covered entity’s fee for any calendar 

year under paragraph (1). In calculating such amount, the 

Secretary shall determine such covered entity’s gross receipts 

from medical device sales on the basis of reports submitted 

by the covered entity under subsection (f) and through the 

use of any other source of information available to the Secretary. 

(c) COVERED ENTITY.— (1) IN GENERAL.—For purposes of this section, the term 

‘‘covered entity’’ means any manufacturer or importer with 

gross receipts from medical device sales. 

(2) CONTROLLED GROUPS.— (A) IN GENERAL.—For purposes of this subsection, all 

persons treated as a single employer under subsection (a) 

or (b) of section 52 of the Internal Revenue Code of 1986 

or subsection (m) or (o) of section 414 of such Code shall 

be treated as a single covered entity. 

(B) INCLUSION OF FOREIGN CORPORATIONS.—For purposes of subparagraph (A), in applying subsections (a) and 

(b) of section 52 of such Code to this section, section 1563 

of such Code shall be applied without regard to subsection 

(b)(2)(C) thereof. 

(d) MEDICAL DEVICE SALES.—For purposes of this section— 

(1) IN GENERAL.—The term ‘‘medical device sales’’ means 

sales for use in the United States of any medical device, other 

than the sales of a medical device that— 

(A) has been classified in class II under section 513 

of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 
H. R. 3590—746 

360c) and is primarily sold to consumers at retail for not 

more than $100 per unit, or 

(B) has been classified in class I under such section. 

(2) UNITED STATES.—For purposes of paragraph (1), the 

term ‘‘United States’’ means the several States, the District 

of Columbia, the Commonwealth of Puerto Rico, and the possessions of the United States. 

(3) MEDICAL DEVICE.—For purposes of paragraph (1), the 

term ‘‘medical device’’ means any device (as defined in section 

201(h) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 

321(h))) intended for humans. 

(e) TAX TREATMENT OF FEES.—The fees imposed by this section— 

(1) for purposes of subtitle F of the Internal Revenue Code 

of 1986, shall be treated as excise taxes with respect to which 

only civil actions for refund under procedures of such subtitle 

shall apply, and 

(2) for purposes of section 275 of such Code, shall be considered to be a tax described in section 275(a)(6). 

(f) REPORTING REQUIREMENT.— 

(1) IN GENERAL.—Not later than the date determined by 

the Secretary following the end of any calendar year, each 

covered entity shall report to the Secretary, in such manner 

as the Secretary prescribes, the gross receipts from medical 

device sales of such covered entity during such calendar year. 

(2) PENALTY FOR FAILURE TO REPORT.— 

(A) IN GENERAL.—In the case of any failure to make 

a report containing the information required by paragraph 

(1) on the date prescribed therefor (determined with regard 

to any extension of time for filing), unless it is shown 

that such failure is due to reasonable cause, there shall 

be paid by the covered entity failing to file such report, 

an amount equal to— 

(i) $10,000, plus 

(ii) the lesser of— 

(I) an amount equal to $1,000, multiplied by 

the number of days during which such failure continues, or 

(II) the amount of the fee imposed by this 

section for which such report was required. 

(B) TREATMENT OF PENALTY.—The penalty imposed 

under subparagraph (A)— 

(i) shall be treated as a penalty for purposes of 

subtitle F of the Internal Revenue Code of 1986, 

(ii) shall be paid on notice and demand by the 

Secretary and in the same manner as tax under such 

Code, and 

(iii) with respect to which only civil actions for 

refund under procedures of such subtitle F shall apply. 

(g) SECRETARY.—For purposes of this section, the term ‘‘Secretary’’ means the Secretary of the Treasury or the Secretary’s 

delegate. 

(h) GUIDANCE.—The Secretary shall publish guidance necessary 

to carry out the purposes of this section, including identification 

of medical devices described in subsection (d)(1)(A) and with respect 

to the treatment of gross receipts from sales of medical devices 
H. R. 3590—747 

to another covered entity or to another entity by reason of the 

application of subsection (c)(2). 

(i) APPLICATION OF SECTION.—This section shall apply to any 

medical device sales after December 31, 2008. 

SEC. 9010. IMPOSITION OF ANNUAL FEE ON HEALTH INSURANCE PROVIDERS. 

(a) IMPOSITION OF FEE.— (1) IN GENERAL.—Each covered entity engaged in the business of providing health insurance shall pay to the Secretary 

not later than the annual payment date of each calendar year 

beginning after 2009 a fee in an amount determined under 

subsection (b). 

(2) ANNUAL PAYMENT DATE.—For purposes of this section, 

the term ‘‘annual payment date’’ means with respect to any 

calendar year the date determined by the Secretary, but in 

no event later than September 30 of such calendar year. 

(b) DETERMINATION OF FEE AMOUNT.— 

(1) IN GENERAL.—With respect to each covered entity, the 

fee under this section for any calendar year shall be equal 

to an amount that bears the same ratio to $6,700,000,000 

as— 

(A) the sum of— 

(i) the covered entity’s net premiums written with 

respect to health insurance for any United States 

health risk that are taken into account during the 

preceding calendar year, plus 

(ii) 200 percent of the covered entity’s third party 

administration agreement fees that are taken into 

account during the preceding calendar year, bears to 

(B) the sum of— 

(i) the aggregate net premiums written with 

respect to such health insurance of all covered entities 

that are taken into account during such preceding calendar year, plus 

(ii) 200 percent of the aggregate third party 

administration agreement fees of all covered entities 

that are taken into account during such preceding calendar year. 

(2) AMOUNTS TAKEN INTO ACCOUNT.—For purposes of paragraph (1)— 

(A) NET PREMIUMS WRITTEN.—The net premiums written with respect to health insurance for any United States 

health risk that are taken into account during any calendar 

year with respect to any covered entity shall be determined 

in accordance with the following table: 

With respect to a covered entity’s net premiums written during the calendar year that 

are: 

The percentage of 

net premiums written that are taken 

into account is: 

Not more than $25,000,000 ..................... 0 percent 

More than $25,000,000 but not more 

than $50,000,000.

50 percent 

More than $50,000,000 ............................. 100 percent. 
H. R. 3590—748 

(B) THIRD PARTY ADMINISTRATION AGREEMENT FEES.— The third party administration agreement fees that are 

taken into account during any calendar year with respect 

to any covered entity shall be determined in accordance 

with the following table: 

With respect to a covered entity’s third party 

administration agreement fees during the 

calendar year that are: 

The percentage of 

third party administration agreement 

fees that are taken 

into account is: 

Not more than $5,000,000 ....................... 0 percent 

More than $5,000,000 but not more than 

$10,000,000.

50 percent 

More than $10,000,000 ............................. 100 percent. 

(3) SECRETARIAL DETERMINATION.—The Secretary shall calculate the amount of each covered entity’s fee for any calendar 

year under paragraph (1). In calculating such amount, the 

Secretary shall determine such covered entity’s net premiums 

written with respect to any United States health risk and 

third party administration agreement fees on the basis of 

reports submitted by the covered entity under subsection (g) 

and through the use of any other source of information available 

to the Secretary. 

(c) COVERED ENTITY.— (1) IN GENERAL.—For purposes of this section, the term 

‘‘covered entity’’ means any entity which provides health insurance for any United States health risk. 

(2) EXCLUSION.—Such term does not include— 

(A) any employer to the extent that such employer 

self-insures its employees’ health risks, or 

(B) any governmental entity (except to the extent such 

an entity provides health insurance coverage through the 

community health insurance option under section 1323). 

(3) CONTROLLED GROUPS.— (A) IN GENERAL.—For purposes of this subsection, all 

persons treated as a single employer under subsection (a) 

or (b) of section 52 of the Internal Revenue Code of 1986 

or subsection (m) or (o) of section 414 of such Code shall 

be treated as a single covered entity (or employer for purposes of paragraph (2)). 

(B) INCLUSION OF FOREIGN CORPORATIONS.—For purposes of subparagraph (A), in applying subsections (a) and 

(b) of section 52 of such Code to this section, section 1563 

of such Code shall be applied without regard to subsection 

(b)(2)(C) thereof. 

(d) UNITED STATES HEALTH RISK.—For purposes of this section, 

the term ‘‘United States health risk’’ means the health risk of 

any individual who is— 

(1) a United States citizen, 

(2) a resident of the United States (within the meaning 

of section 7701(b)(1)(A) of the Internal Revenue Code of 1986), 

or 

(3) located in the United States, with respect to the period 

such individual is so located. 
H. R. 3590—749 

(e) THIRD PARTY ADMINISTRATION AGREEMENT FEES.—For purposes of this section, the term ‘‘third party administration agreement fees’’ means, with respect to any covered entity, amounts 

received from an employer which are in excess of payments made 

by such covered entity for health benefits under an arrangement 

under which such employer self-insures the United States health 

risk of its employees. 

(f) TAX TREATMENT OF FEES.—The fees imposed by this section— 

(1) for purposes of subtitle F of the Internal Revenue Code 

of 1986, shall be treated as excise taxes with respect to which 

only civil actions for refund under procedures of such subtitle 

shall apply, and 

(2) for purposes of section 275 of such Code shall be considered to be a tax described in section 275(a)(6). 

(g) REPORTING REQUIREMENT.— 

(1) IN GENERAL.—Not later than the date determined by 

the Secretary following the end of any calendar year, each 

covered entity shall report to the Secretary, in such manner 

as the Secretary prescribes, the covered entity’s net premiums 

written with respect to health insurance for any United States 

health risk and third party administration agreement fees for 

such calendar year. 

(2) PENALTY FOR FAILURE TO REPORT.— 

(A) IN GENERAL.—In the case of any failure to make 

a report containing the information required by paragraph 

(1) on the date prescribed therefor (determined with regard 

to any extension of time for filing), unless it is shown 

that such failure is due to reasonable cause, there shall 

be paid by the covered entity failing to file such report, 

an amount equal to— (i) $10,000, plus 

(ii) the lesser of— 

(I) an amount equal to $1,000, multiplied by 

the number of days during which such failure continues, or 

(II) the amount of the fee imposed by this 

section for which such report was required. 

(B) TREATMENT OF PENALTY.—The penalty imposed 

under subparagraph (A)— 

(i) shall be treated as a penalty for purposes of 

subtitle F of the Internal Revenue Code of 1986, 

(ii) shall be paid on notice and demand by the 

Secretary and in the same manner as tax under such 

Code, and 

(iii) with respect to which only civil actions for 

refund under procedures of such subtitle F shall apply. 

(h) ADDITIONAL DEFINITIONS.—For purposes of this section— 

(1) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of the Treasury or the Secretary’s delegate. 

(2) UNITED STATES.—The term ‘‘United States’’ means the 

several States, the District of Columbia, the Commonwealth 

of Puerto Rico, and the possessions of the United States. 

(3) HEALTH INSURANCE.—The term ‘‘health insurance’’ shall 

not include insurance for long-term care or disability. 

(i) GUIDANCE.—The Secretary shall publish guidance necessary 

to carry out the purposes of this section. 
H. R. 3590—750 

(j) APPLICATION OF SECTION.—This section shall apply to any 

net premiums written after December 31, 2008, with respect to 

health insurance for any United States health risk, and any third 

party administration agreement fees received after such date. 

SEC. 9011. STUDY AND REPORT OF EFFECT ON VETERANS HEALTH 

CARE. 

(a) IN GENERAL.—The Secretary of Veterans Affairs shall conduct a study on the effect (if any) of the provisions of sections 

9008, 9009, and 9010 on— 

(1) the cost of medical care provided to veterans, and 

(2) veterans’ access to medical devices and branded 

prescription drugs. 

(b) REPORT.—The Secretary of Veterans Affairs shall report 

the results of the study under subsection (a) to the Committee 

on Ways and Means of the House of Representatives and to the 

Committee on Finance of the Senate not later than December 

31, 2012. 

SEC. 9012. ELIMINATION OF DEDUCTION FOR EXPENSES ALLOCABLE 

TO MEDICARE PART D SUBSIDY. 

(a) IN GENERAL.—Section 139A of the Internal Revenue Code 

of 1986 is amended by striking the second sentence. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2010. 

SEC. 9013. MODIFICATION OF ITEMIZED DEDUCTION FOR MEDICAL 

EXPENSES. 

(a) IN GENERAL.—Subsection (a) of section 213 of the Internal 

Revenue Code of 1986 is amended by striking ‘‘7.5 percent’’ and 

inserting ‘‘10 percent’’. 

(b) TEMPORARY WAIVER OF INCREASE FOR CERTAIN SENIORS.— 

Section 213 of the Internal Revenue Code of 1986 is amended 

by adding at the end the following new subsection: 

‘‘(f) SPECIAL RULE FOR 2013, 2014, 2015, AND 2016.—In the 

case of any taxable year beginning after December 31, 2012, and 

ending before January 1, 2017, subsection (a) shall be applied 

with respect to a taxpayer by substituting ‘7.5 percent’ for ‘10 

percent’ if such taxpayer or such taxpayer’s spouse has attained 

age 65 before the close of such taxable year.’’. 

(c) CONFORMING AMENDMENT.—Section 56(b)(1)(B) of the 

Internal Revenue Code of 1986 is amended by striking ‘‘by substituting ‘10 percent’ for ‘7.5 percent’ ’’ and inserting ‘‘without regard 

to subsection (f) of such section’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2012. 

SEC. 9014. LIMITATION ON EXCESSIVE REMUNERATION PAID BY CERTAIN HEALTH INSURANCE PROVIDERS. 

(a) IN GENERAL.—Section 162(m) of the Internal Revenue Code 

of 1986 is amended by adding at the end the following new subparagraph: 

‘‘(6) SPECIAL RULE FOR APPLICATION TO CERTAIN HEALTH

INSURANCE PROVIDERS.— 

‘‘(A) IN GENERAL.—No deduction shall be allowed under 

this chapter— 
H. R. 3590—751 

‘‘(i) in the case of applicable individual remuneration which is for any disqualified taxable year beginning after December 31, 2012, and which is attributable to services performed by an applicable individual during such taxable year, to the extent that 

the amount of such remuneration exceeds $500,000, 

or 

‘‘(ii) in the case of deferred deduction remuneration 

for any taxable year beginning after December 31, 

2012, which is attributable to services performed by 

an applicable individual during any disqualified taxable year beginning after December 31, 2009, to the 

extent that the amount of such remuneration exceeds 

$500,000 reduced (but not below zero) by the sum 

of— 

‘‘(I) the applicable individual remuneration for 

such disqualified taxable year, plus 

‘‘(II) the portion of the deferred deduction 

remuneration for such services which was taken 

into account under this clause in a preceding taxable year (or which would have been taken into 

account under this clause in a preceding taxable 

year if this clause were applied by substituting 

‘December 31, 2009’ for ‘December 31, 2012’ in 

the matter preceding subclause (I)). 

‘‘(B) DISQUALIFIED TAXABLE YEAR.—For purposes of this 

paragraph, the term ‘disqualified taxable year’ means, with 

respect to any employer, any taxable year for which such 

employer is a covered health insurance provider. 

‘‘(C) COVERED HEALTH INSURANCE PROVIDER.—For purposes of this paragraph— 

‘‘(i) IN GENERAL.—The term ‘covered health insurance provider’ means— 

‘‘(I) with respect to taxable years beginning 

after December 31, 2009, and before January 1, 

2013, any employer which is a health insurance 

issuer (as defined in section 9832(b)(2)) and which 

receives premiums from providing health insurance coverage (as defined in section 9832(b)(1)), 

and 

‘‘(II) with respect to taxable years beginning 

after December 31, 2012, any employer which is 

a health insurance issuer (as defined in section 

9832(b)(2)) and with respect to which not less than 

25 percent of the gross premiums received from 

providing health insurance coverage (as defined 

in section 9832(b)(1)) is from minimum essential 

coverage (as defined in section 5000A(f)). 

‘‘(ii) AGGREGATION RULES.—Two or more persons 

who are treated as a single employer under subsection 

(b), (c), (m), or (o) of section 414 shall be treated 

as a single employer, except that in applying section 

1563(a) for purposes of any such subsection, paragraphs (2) and (3) thereof shall be disregarded. 

‘‘(D) APPLICABLE INDIVIDUAL REMUNERATION.—For purposes of this paragraph, the term ‘applicable individual 
H. R. 3590—752 

remuneration’ means, with respect to any applicable individual for any disqualified taxable year, the aggregate 

amount allowable as a deduction under this chapter for 

such taxable year (determined without regard to this subsection) for remuneration (as defined in paragraph (4) without regard to subparagraphs (B), (C), and (D) thereof) for 

services performed by such individual (whether or not 

during the taxable year). Such term shall not include any 

deferred deduction remuneration with respect to services 

performed during the disqualified taxable year. 

‘‘(E) DEFERRED DEDUCTION REMUNERATION.—For purposes of this paragraph, the term ‘deferred deduction remuneration’ means remuneration which would be applicable 

individual remuneration for services performed in a disqualified taxable year but for the fact that the deduction 

under this chapter (determined without regard to this paragraph) for such remuneration is allowable in a subsequent 

taxable year. 

‘‘(F) APPLICABLE INDIVIDUAL.—For purposes of this 

paragraph, the term ‘applicable individual’ means, with 

respect to any covered health insurance provider for any 

disqualified taxable year, any individual— 

‘‘(i) who is an officer, director, or employee in such 

taxable year, or 

‘‘(ii) who provides services for or on behalf of such 

covered health insurance provider during such taxable 

year. 

‘‘(G) COORDINATION.—Rules similar to the rules of subparagraphs (F) and (G) of paragraph (4) shall apply for 

purposes of this paragraph. 

‘‘(H) REGULATORY AUTHORITY.—The Secretary may prescribe such guidance, rules, or regulations as are necessary 

to carry out the purposes of this paragraph.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2009, 

with respect to services performed after such date. 

SEC. 9015. ADDITIONAL HOSPITAL INSURANCE TAX ON HIGH-INCOME 

TAXPAYERS. 

(a) FICA.— 

(1) IN GENERAL.—Section 3101(b) of the Internal Revenue 

Code of 1986 is amended— 

(A) by striking ‘‘In addition’’ and inserting the following: 

‘‘(1) IN GENERAL.—In addition’’, 

(B) by striking ‘‘the following percentages of the’’ and 

inserting ‘‘1.45 percent of the’’, 

(C) by striking ‘‘(as defined in section 3121(b))—’’ and 

all that follows and inserting ‘‘(as defined in section 

3121(b)).’’, and 

(D) by adding at the end the following new paragraph: 

‘‘(2) ADDITIONAL TAX.—In addition to the tax imposed by 

paragraph (1) and the preceding subsection, there is hereby 

imposed on every taxpayer (other than a corporation, estate, 

or trust) a tax equal to 0.5 percent of wages which are received 

with respect to employment (as defined in section 3121(b)) 
H. R. 3590—753 

during any taxable year beginning after December 31, 2012, 

and which are in excess of— 

‘‘(A) in the case of a joint return, $250,000, and 

‘‘(B) in any other case, $200,000.’’. 

(2) COLLECTION OF TAX.—Section 3102 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: 

‘‘(f) SPECIAL RULES FOR ADDITIONAL TAX.— 

‘‘(1) IN GENERAL.—In the case of any tax imposed by section 

3101(b)(2), subsection (a) shall only apply to the extent to 

which the taxpayer receives wages from the employer in excess 

of $200,000, and the employer may disregard the amount of 

wages received by such taxpayer’s spouse. 

‘‘(2) COLLECTION OF AMOUNTS NOT WITHHELD.—To the 

extent that the amount of any tax imposed by section 3101(b)(2) 

is not collected by the employer, such tax shall be paid by 

the employee. 

‘‘(3) TAX PAID BY RECIPIENT.—If an employer, in violation 

of this chapter, fails to deduct and withhold the tax imposed 

by section 3101(b)(2) and thereafter the tax is paid by the 

employee, the tax so required to be deducted and withheld 

shall not be collected from the employer, but this paragraph 

shall in no case relieve the employer from liability for any 

penalties or additions to tax otherwise applicable in respect 

of such failure to deduct and withhold.’’. 

(b) SECA.— 

(1) IN GENERAL.—Section 1401(b) of the Internal Revenue 

Code of 1986 is amended— 

(A) by striking ‘‘In addition’’ and inserting the following: 

‘‘(1) IN GENERAL.—In addition’’, and 

(B) by adding at the end the following new paragraph: 

‘‘(2) ADDITIONAL TAX.— 

‘‘(A) IN GENERAL.—In addition to the tax imposed by 

paragraph (1) and the preceding subsection, there is hereby 

imposed on every taxpayer (other than a corporation, 

estate, or trust) for each taxable year beginning after 

December 31, 2012, a tax equal to 0.5 percent of the selfemployment income for such taxable year which is in excess 

of— 

‘‘(i) in the case of a joint return, $250,000, and 

‘‘(ii) in any other case, $200,000. 

‘‘(B) COORDINATION WITH FICA.—The amounts under 

clauses (i) and (ii) of subparagraph (A) shall be reduced 

(but not below zero) by the amount of wages taken into 

account in determining the tax imposed under section 

3121(b)(2) with respect to the taxpayer.’’. 

(2) NO DEDUCTION FOR ADDITIONAL TAX.— 

(A) IN GENERAL.—Section 164(f) of such Code is 

amended by inserting ‘‘(other than the taxes imposed by 

section 1401(b)(2))’’ after ‘‘section 1401)’’. 

(B) DEDUCTION FOR NET EARNINGS FROM SELF-EMPLOYMENT.—Subparagraph (B) of section 1402(a)(12) is amended 

by inserting ‘‘(determined without regard to the rate 

imposed under paragraph (2) of section 1401(b))’’ after ‘‘for 

such year’’. 
H. R. 3590—754 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to remuneration received, and taxable 

years beginning, after December 31, 2012. 

SEC. 9016. MODIFICATION OF SECTION 833 TREATMENT OF CERTAIN 

HEALTH ORGANIZATIONS. 

(a) IN GENERAL.—Subsection (c) of section 833 of the Internal 

Revenue Code of 1986 is amended by adding at the end the following 

new paragraph: 

‘‘(5) NONAPPLICATION OF SECTION IN CASE OF LOW MEDICAL

LOSS RATIO.—Notwithstanding the preceding paragraphs, this 

section shall not apply to any organization unless such 

organization’s percentage of total premium revenue expended 

on reimbursement for clinical services provided to enrollees 

under its policies during such taxable year (as reported under 

section 2718 of the Public Health Service Act) is not less than 

85 percent.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2009. 

SEC. 9017. EXCISE TAX ON ELECTIVE COSMETIC MEDICAL PROCEDURES. 

(a) IN GENERAL.—Subtitle D of the Internal Revenue Code 

of 1986, as amended by this Act, is amended by adding at the 

end the following new chapter: 

‘‘CHAPTER 49—ELECTIVE COSMETIC MEDICAL 

PROCEDURES 

‘‘Sec. 5000B. Imposition of tax on elective cosmetic medical procedures. 

‘‘SEC. 5000B. IMPOSITION OF TAX ON ELECTIVE COSMETIC MEDICAL 

PROCEDURES. 

‘‘(a) IN GENERAL.—There is hereby imposed on any cosmetic 

surgery and medical procedure a tax equal to 5 percent of the 

amount paid for such procedure (determined without regard to 

this section), whether paid by insurance or otherwise. 

‘‘(b) COSMETIC SURGERY AND MEDICAL PROCEDURE.—For purposes of this section, the term ‘cosmetic surgery and medical procedure’ means any cosmetic surgery (as defined in section 213(d)(9)(B)) 

or other similar procedure which— 

‘‘(1) is performed by a licensed medical professional, and 

‘‘(2) is not necessary to ameliorate a deformity arising 

from, or directly related to, a congenital abnormality, a personal 

injury resulting from an accident or trauma, or disfiguring 

disease. 

‘‘(c) PAYMENT OF TAX.— ‘‘(1) IN GENERAL.—The tax imposed by this section shall 

be paid by the individual on whom the procedure is performed. 

‘‘(2) COLLECTION.—Every person receiving a payment for 

procedures on which a tax is imposed under subsection (a) 

shall collect the amount of the tax from the individual on 

whom the procedure is performed and remit such tax quarterly 

to the Secretary at such time and in such manner as provided 

by the Secretary. 

‘‘(3) SECONDARY LIABILITY.—Where any tax imposed by subsection (a) is not paid at the time payments for cosmetic surgery 

and medical procedures are made, then to the extent that 
H. R. 3590—755 

such tax is not collected, such tax shall be paid by the person 

who performs the procedure.’’. 

(b) CLERICAL AMENDMENT.—The table of chapters for subtitle 

D of the Internal Revenue Code of 1986, as amended by this 

Act, is amended by inserting after the item relating to chapter 

48 the following new item: 

‘‘CHAPTER 49—ELECTIVE COSMETIC MEDICAL PROCEDURES’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to procedures performed on or after January 1, 2010. 

Subtitle B—Other Provisions 

SEC. 9021. EXCLUSION OF HEALTH BENEFITS PROVIDED BY INDIAN 

TRIBAL GOVERNMENTS. 

(a) IN GENERAL.—Part III of subchapter B of chapter 1 of 

the Internal Revenue Code of 1986 is amended by inserting after 

section 139C the following new section: 

‘‘SEC. 139D. INDIAN HEALTH CARE BENEFITS. 

‘‘(a) GENERAL RULE.—Except as otherwise provided in this section, gross income does not include the value of any qualified 

Indian health care benefit. 

‘‘(b) QUALIFIED INDIAN HEALTH CARE BENEFIT.—For purposes 

of this section, the term ‘qualified Indian health care benefit’ 

means— 

‘‘(1) any health service or benefit provided or purchased, 

directly or indirectly, by the Indian Health Service through 

a grant to or a contract or compact with an Indian tribe or 

tribal organization, or through a third-party program funded 

by the Indian Health Service, 

‘‘(2) medical care provided or purchased by, or amounts 

to reimburse for such medical care provided by, an Indian 

tribe or tribal organization for, or to, a member of an Indian 

tribe, including a spouse or dependent of such a member, 

‘‘(3) coverage under accident or health insurance (or an 

arrangement having the effect of accident or health insurance), 

or an accident or health plan, provided by an Indian tribe 

or tribal organization for medical care to a member of an 

Indian tribe, include a spouse or dependent of such a member, 

and 

‘‘(4) any other medical care provided by an Indian tribe 

or tribal organization that supplements, replaces, or substitutes 

for a program or service relating to medical care provided 

by the Federal government to Indian tribes or members of 

such a tribe. 

‘‘(c) DEFINITIONS.—For purposes of this section— 

‘‘(1) INDIAN TRIBE.—The term ‘Indian tribe’ has the meaning 

given such term by section 45A(c)(6). 

‘‘(2) TRIBAL ORGANIZATION.—The term ‘tribal organization’ 

has the meaning given such term by section 4(l) of the Indian 

Self-Determination and Education Assistance Act. 

‘‘(3) MEDICAL CARE.—The term ‘medical care’ has the same 

meaning as when used in section 213. 

‘‘(4) ACCIDENT OR HEALTH INSURANCE; ACCIDENT OR HEALTH

PLAN.—The terms ‘accident or health insurance’ and ‘accident 
H. R. 3590—756 

or health plan’ have the same meaning as when used in section 

105. 

‘‘(5) DEPENDENT.—The term ‘dependent’ has the meaning 

given such term by section 152, determined without regard 

to subsections (b)(1), (b)(2), and (d)(1)(B) thereof. 

‘‘(d) DENIAL OF DOUBLE BENEFIT.—Subsection (a) shall not 

apply to the amount of any qualified Indian health care benefit 

which is not includible in gross income of the beneficiary of such 

benefit under any other provision of this chapter, or to the amount 

of any such benefit for which a deduction is allowed to such beneficiary under any other provision of this chapter.’’. 

(b) CLERICAL AMENDMENT.—The table of sections for part III 

of subchapter B of chapter 1 of the Internal Revenue Code of 

1986 is amended by inserting after the item relating to section 

139C the following new item: 

‘‘Sec. 139D. Indian health care benefits.’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to benefits and coverage provided after the date of 

the enactment of this Act. 

(d) NO INFERENCE.—Nothing in the amendments made by this 

section shall be construed to create an inference with respect to 

the exclusion from gross income of— 

(1) benefits provided by an Indian tribe or tribal organization that are not within the scope of this section, and 

(2) benefits provided prior to the date of the enactment 

of this Act. 

SEC. 9022. ESTABLISHMENT OF SIMPLE CAFETERIA PLANS FOR SMALL 

BUSINESSES. 

(a) IN GENERAL.—Section 125 of the Internal Revenue Code 

of 1986 (relating to cafeteria plans), as amended by this Act, is 

amended by redesignating subsections (j) and (k) as subsections 

(k) and (l), respectively, and by inserting after subsection (i) the 

following new subsection: 

‘‘(j) SIMPLE CAFETERIA PLANS FOR SMALL BUSINESSES.— ‘‘(1) IN GENERAL.—An eligible employer maintaining a 

simple cafeteria plan with respect to which the requirements 

of this subsection are met for any year shall be treated as 

meeting any applicable nondiscrimination requirement during 

such year. 

‘‘(2) SIMPLE CAFETERIA PLAN.—For purposes of this subsection, the term ‘simple cafeteria plan’ means a cafeteria 

plan— 

‘‘(A) which is established and maintained by an eligible 

employer, and 

‘‘(B) with respect to which the contribution requirements of paragraph (3), and the eligibility and participation 

requirements of paragraph (4), are met. 

‘‘(3) CONTRIBUTION REQUIREMENTS.— ‘‘(A) IN GENERAL.—The requirements of this paragraph 

are met if, under the plan the employer is required, without 

regard to whether a qualified employee makes any salary 

reduction contribution, to make a contribution to provide 

qualified benefits under the plan on behalf of each qualified 

employee in an amount equal to— 

‘‘(i) a uniform percentage (not less than 2 percent) 

of the employee’s compensation for the plan year, or 
H. R. 3590—757 

‘‘(ii) an amount which is not less than the lesser 

of— 

‘‘(I) 6 percent of the employee’s compensation 

for the plan year, or 

‘‘(II) twice the amount of the salary reduction 

contributions of each qualified employee. 

‘‘(B) MATCHING CONTRIBUTIONS ON BEHALF OF HIGHLY

COMPENSATED AND KEY EMPLOYEES.—The requirements of 

subparagraph (A)(ii) shall not be treated as met if, under 

the plan, the rate of contributions with respect to any 

salary reduction contribution of a highly compensated or 

key employee at any rate of contribution is greater than 

that with respect to an employee who is not a highly 

compensated or key employee. 

‘‘(C) ADDITIONAL CONTRIBUTIONS.—Subject to subparagraph (B), nothing in this paragraph shall be treated as 

prohibiting an employer from making contributions to provide qualified benefits under the plan in addition to contributions required under subparagraph (A). 

‘‘(D) DEFINITIONS.—For purposes of this paragraph— 

‘‘(i) SALARY REDUCTION CONTRIBUTION.—The term 

‘salary reduction contribution’ means, with respect to 

a cafeteria plan, any amount which is contributed to 

the plan at the election of the employee and which 

is not includible in gross income by reason of this 

section. 

‘‘(ii) QUALIFIED EMPLOYEE.—The term ‘qualified 

employee’ means, with respect to a cafeteria plan, any 

employee who is not a highly compensated or key 

employee and who is eligible to participate in the plan. 

‘‘(iii) HIGHLY COMPENSATED EMPLOYEE.—The term 

‘highly compensated employee’ has the meaning given 

such term by section 414(q). 

‘‘(iv) KEY EMPLOYEE.—The term ‘key employee’ has 

the meaning given such term by section 416(i). 

‘‘(4) MINIMUM ELIGIBILITY AND PARTICIPATION REQUIRE- MENTS.— 

‘‘(A) IN GENERAL.—The requirements of this paragraph 

shall be treated as met with respect to any year if, under 

the plan— 

‘‘(i) all employees who had at least 1,000 hours 

of service for the preceding plan year are eligible to 

participate, and 

‘‘(ii) each employee eligible to participate in the 

plan may, subject to terms and conditions applicable 

to all participants, elect any benefit available under 

the plan. 

‘‘(B) CERTAIN EMPLOYEES MAY BE EXCLUDED.—For purposes of subparagraph (A)(i), an employer may elect to 

exclude under the plan employees— 

‘‘(i) who have not attained the age of 21 before 

the close of a plan year, 

‘‘(ii) who have less than 1 year of service with 

the employer as of any day during the plan year, 

‘‘(iii) who are covered under an agreement which 

the Secretary of Labor finds to be a collective bargaining agreement if there is evidence that the benefits 
H. R. 3590—758 

covered under the cafeteria plan were the subject of 

good faith bargaining between employee representatives and the employer, or 

‘‘(iv) who are described in section 410(b)(3)(C) 

(relating to nonresident aliens working outside the 

United States). 

A plan may provide a shorter period of service or younger 

age for purposes of clause (i) or (ii). 

‘‘(5) ELIGIBLE EMPLOYER.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘eligible employer’ means, 

with respect to any year, any employer if such employer 

employed an average of 100 or fewer employees on business 

days during either of the 2 preceding years. For purposes 

of this subparagraph, a year may only be taken into account 

if the employer was in existence throughout the year. 

‘‘(B) EMPLOYERS NOT IN EXISTENCE DURING PRECEDING

YEAR.—If an employer was not in existence throughout 

the preceding year, the determination under subparagraph 

(A) shall be based on the average number of employees 

that it is reasonably expected such employer will employ 

on business days in the current year. 

‘‘(C) GROWING EMPLOYERS RETAIN TREATMENT AS SMALL

EMPLOYER.— 

‘‘(i) IN GENERAL.—If— 

‘‘(I) an employer was an eligible employer for 

any year (a ‘qualified year’), and 

‘‘(II) such employer establishes a simple cafeteria plan for its employees for such year, 

then, notwithstanding the fact the employer fails to 

meet the requirements of subparagraph (A) for any 

subsequent year, such employer shall be treated as 

an eligible employer for such subsequent year with 

respect to employees (whether or not employees during 

a qualified year) of any trade or business which was 

covered by the plan during any qualified year. 

‘‘(ii) EXCEPTION.—This subparagraph shall cease 

to apply if the employer employs an average of 200 

or more employees on business days during any year 

preceding any such subsequent year. 

‘‘(D) SPECIAL RULES.— 

‘‘(i) PREDECESSORS.—Any reference in this paragraph to an employer shall include a reference to any 

predecessor of such employer. 

‘‘(ii) AGGREGATION RULES.—All persons treated as 

a single employer under subsection (a) or (b) of section 

52, or subsection (n) or (o) of section 414, shall be 

treated as one person. 

‘‘(6) APPLICABLE NONDISCRIMINATION REQUIREMENT.—For 

purposes of this subsection, the term ‘applicable nondiscrimination requirement’ means any requirement under subsection 

(b) of this section, section 79(d), section 105(h), or paragraph 

(2), (3), (4), or (8) of section 129(d). 

‘‘(7) COMPENSATION.—The term ‘compensation’ has the 

meaning given such term by section 414(s).’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall apply to years beginning after December 31, 2010. 
H. R. 3590—759 

SEC. 9023. QUALIFYING THERAPEUTIC DISCOVERY PROJECT CREDIT. 

(a) IN GENERAL.—Subpart E of part IV of subchapter A of 

chapter 1 of the Internal Revenue Code of 1986 is amended by 

inserting after section 48C the following new section: 

‘‘SEC. 48D. QUALIFYING THERAPEUTIC DISCOVERY PROJECT CREDIT. 

‘‘(a) IN GENERAL.—For purposes of section 46, the qualifying 

therapeutic discovery project credit for any taxable year is an 

amount equal to 50 percent of the qualified investment for such 

taxable year with respect to any qualifying therapeutic discovery 

project of an eligible taxpayer. 

‘‘(b) QUALIFIED INVESTMENT.— 

‘‘(1) IN GENERAL.—For purposes of subsection (a), the qualified investment for any taxable year is the aggregate amount 

of the costs paid or incurred in such taxable year for expenses 

necessary for and directly related to the conduct of a qualifying 

therapeutic discovery project. 

‘‘(2) LIMITATION.—The amount which is treated as qualified 

investment for all taxable years with respect to any qualifying 

therapeutic discovery project shall not exceed the amount certified by the Secretary as eligible for the credit under this 

section. 

‘‘(3) EXCLUSIONS.—The qualified investment for any taxable 

year with respect to any qualifying therapeutic discovery project 

shall not take into account any cost— 

‘‘(A) for remuneration for an employee described in 

section 162(m)(3), 

‘‘(B) for interest expenses, 

‘‘(C) for facility maintenance expenses, 

‘‘(D) which is identified as a service cost under section 

1.263A–1(e)(4) of title 26, Code of Federal Regulations, 

or 

‘‘(E) for any other expense as determined by the Secretary as appropriate to carry out the purposes of this 

section. 

‘‘(4) CERTAIN PROGRESS EXPENDITURE RULES MADE

APPLICABLE.—In the case of costs described in paragraph (1) 

that are paid for property of a character subject to an allowance 

for depreciation, rules similar to the rules of subsections (c)(4) 

and (d) of section 46 (as in effect on the day before the date 

of the enactment of the Revenue Reconciliation Act of 1990) 

shall apply for purposes of this section. 

‘‘(5) APPLICATION OF SUBSECTION.—An investment shall be 

considered a qualified investment under this subsection only 

if such investment is made in a taxable year beginning in 

2009 or 2010. 

‘‘(c) DEFINITIONS.— 

‘‘(1) QUALIFYING THERAPEUTIC DISCOVERY PROJECT.—The 

term ‘qualifying therapeutic discovery project’ means a project 

which is designed— 

‘‘(A) to treat or prevent diseases or conditions by conducting pre-clinical activities, clinical trials, and clinical 

studies, or carrying out research protocols, for the purpose 

of securing approval of a product under section 505(b) 

of the Federal Food, Drug, and Cosmetic Act or section 

351(a) of the Public Health Service Act, 
H. R. 3590—760 

‘‘(B) to diagnose diseases or conditions or to determine 

molecular factors related to diseases or conditions by developing molecular diagnostics to guide therapeutic decisions, 

or 

‘‘(C) to develop a product, process, or technology to 

further the delivery or administration of therapeutics. 

‘‘(2) ELIGIBLE TAXPAYER.— 

‘‘(A) IN GENERAL.—The term ‘eligible taxpayer’ means 

a taxpayer which employs not more than 250 employees 

in all businesses of the taxpayer at the time of the submission of the application under subsection (d)(2). 

‘‘(B) AGGREGATION RULES.—All persons treated as a 

single employer under subsection (a) or (b) of section 52, 

or subsection (m) or (o) of section 414, shall be so treated 

for purposes of this paragraph. 

‘‘(3) FACILITY MAINTENANCE EXPENSES.—The term ‘facility 

maintenance expenses’ means costs paid or incurred to maintain a facility, including— 

‘‘(A) mortgage or rent payments, 

‘‘(B) insurance payments, 

‘‘(C) utility and maintenance costs, and 

‘‘(D) costs of employment of maintenance personnel. 

‘‘(d) QUALIFYING THERAPEUTIC DISCOVERY PROJECT PROGRAM.— 

‘‘(1) ESTABLISHMENT.— 

‘‘(A) IN GENERAL.—Not later than 60 days after the 

date of the enactment of this section, the Secretary, in 

consultation with the Secretary of Health and Human Services, shall establish a qualifying therapeutic discovery 

project program to consider and award certifications for 

qualified investments eligible for credits under this section 

to qualifying therapeutic discovery project sponsors. 

‘‘(B) LIMITATION.—The total amount of credits that may 

be allocated under the program shall not exceed 

$1,000,000,000 for the 2-year period beginning with 2009. 

‘‘(2) CERTIFICATION.— ‘‘(A) APPLICATION PERIOD.—Each applicant for certification under this paragraph shall submit an application 

containing such information as the Secretary may require 

during the period beginning on the date the Secretary 

establishes the program under paragraph (1). 

‘‘(B) TIME FOR REVIEW OF APPLICATIONS.—The Secretary shall take action to approve or deny any application 

under subparagraph (A) within 30 days of the submission 

of such application. 

‘‘(C) MULTI-YEAR APPLICATIONS.—An application for 

certification under subparagraph (A) may include a request 

for an allocation of credits for more than 1 of the years 

described in paragraph (1)(B). 

‘‘(3) SELECTION CRITERIA.—In determining the qualifying 

therapeutic discovery projects with respect to which qualified 

investments may be certified under this section, the Secretary— 

‘‘(A) shall take into consideration only those projects 

that show reasonable potential— 

‘‘(i) to result in new therapies— 

‘‘(I) to treat areas of unmet medical need, or 

‘‘(II) to prevent, detect, or treat chronic or 

acute diseases and conditions, 
H. R. 3590—761 

‘‘(ii) to reduce long-term health care costs in the 

United States, or 

‘‘(iii) to significantly advance the goal of curing 

cancer within the 30-year period beginning on the date 

the Secretary establishes the program under paragraph 

(1), and 

‘‘(B) shall take into consideration which projects have 

the greatest potential— 

‘‘(i) to create and sustain (directly or indirectly) 

high quality, high-paying jobs in the United States, 

and 

‘‘(ii) to advance United States competitiveness in 

the fields of life, biological, and medical sciences. 

‘‘(4) DISCLOSURE OF ALLOCATIONS.—The Secretary shall, 

upon making a certification under this subsection, publicly 

disclose the identity of the applicant and the amount of the 

credit with respect to such applicant. 

‘‘(e) SPECIAL RULES.— 

‘‘(1) BASIS ADJUSTMENT.—For purposes of this subtitle, if 

a credit is allowed under this section for an expenditure related 

to property of a character subject to an allowance for depreciation, the basis of such property shall be reduced by the amount 

of such credit. 

‘‘(2) DENIAL OF DOUBLE BENEFIT.— 

‘‘(A) BONUS DEPRECIATION.—A credit shall not be 

allowed under this section for any investment for which 

bonus depreciation is allowed under section 168(k), 

1400L(b)(1), or 1400N(d)(1). 

‘‘(B) DEDUCTIONS.—No deduction under this subtitle 

shall be allowed for the portion of the expenses otherwise 

allowable as a deduction taken into account in determining 

the credit under this section for the taxable year which 

is equal to the amount of the credit determined for such 

taxable year under subsection (a) attributable to such portion. This subparagraph shall not apply to expenses related 

to property of a character subject to an allowance for depreciation the basis of which is reduced under paragraph 

(1), or which are described in section 280C(g). 

‘‘(C) CREDIT FOR RESEARCH ACTIVITIES.— 

‘‘(i) IN GENERAL.—Except as provided in clause 

(ii), any expenses taken into account under this section 

for a taxable year shall not be taken into account 

for purposes of determining the credit allowable under 

section 41 or 45C for such taxable year. 

‘‘(ii) EXPENSES INCLUDED IN DETERMINING BASE

PERIOD RESEARCH EXPENSES.—Any expenses for any 

taxable year which are qualified research expenses 

(within the meaning of section 41(b)) shall be taken 

into account in determining base period research 

expenses for purposes of applying section 41 to subsequent taxable years. 

‘‘(f) COORDINATION WITH DEPARTMENT OF TREASURY GRANTS.— In the case of any investment with respect to which the Secretary 

makes a grant under section 9023(e) of the Patient Protection 

and Affordable Care Act of 2009— 

‘‘(1) DENIAL OF CREDIT.—No credit shall be determined 

under this section with respect to such investment for the 
H. R. 3590—762 

taxable year in which such grant is made or any subsequent 

taxable year. 

‘‘(2) RECAPTURE OF CREDITS FOR PROGRESS EXPENDITURES

MADE BEFORE GRANT.—If a credit was determined under this 

section with respect to such investment for any taxable year 

ending before such grant is made— 

‘‘(A) the tax imposed under subtitle A on the taxpayer 

for the taxable year in which such grant is made shall 

be increased by so much of such credit as was allowed 

under section 38, 

‘‘(B) the general business carryforwards under section 

39 shall be adjusted so as to recapture the portion of 

such credit which was not so allowed, and 

‘‘(C) the amount of such grant shall be determined 

without regard to any reduction in the basis of any property 

of a character subject to an allowance for depreciation 

by reason of such credit. 

‘‘(3) TREATMENT OF GRANTS.—Any such grant shall not 

be includible in the gross income of the taxpayer.’’. 

(b) INCLUSION AS PART OF INVESTMENT CREDIT.—Section 46 

of the Internal Revenue Code of 1986 is amended— 

(1) by adding a comma at the end of paragraph (2), 

(2) by striking the period at the end of paragraph (5) 

and inserting ‘‘, and’’, and 

(3) by adding at the end the following new paragraph: 

‘‘(6) the qualifying therapeutic discovery project credit.’’. 

(c) CONFORMING AMENDMENTS.— (1) Section 49(a)(1)(C) of the Internal Revenue Code of 

1986 is amended— 

(A) by striking ‘‘and’’ at the end of clause (iv), 

(B) by striking the period at the end of clause (v) 

and inserting ‘‘, and’’, and 

(C) by adding at the end the following new clause: 

‘‘(vi) the basis of any property to which paragraph 

(1) of section 48D(e) applies which is part of a qualifying therapeutic discovery project under such section 

48D.’’. 

(2) Section 280C of such Code is amended by adding at 

the end the following new subsection: 

‘‘(g) QUALIFYING THERAPEUTIC DISCOVERY PROJECT CREDIT.— 

‘‘(1) IN GENERAL.—No deduction shall be allowed for that 

portion of the qualified investment (as defined in section 48D(b)) 

otherwise allowable as a deduction for the taxable year which— 

‘‘(A) would be qualified research expenses (as defined 

in section 41(b)), basic research expenses (as defined in 

section 41(e)(2)), or qualified clinical testing expenses (as 

defined in section 45C(b)) if the credit under section 41 

or section 45C were allowed with respect to such expenses 

for such taxable year, and 

‘‘(B) is equal to the amount of the credit determined 

for such taxable year under section 48D(a), reduced by— 

‘‘(i) the amount disallowed as a deduction by reason 

of section 48D(e)(2)(B), and 

‘‘(ii) the amount of any basis reduction under section 48D(e)(1). 

‘‘(2) SIMILAR RULE WHERE TAXPAYER CAPITALIZES RATHER

THAN DEDUCTS EXPENSES.—In the case of expenses described 
H. R. 3590—763 

in paragraph (1)(A) taken into account in determining the credit 

under section 48D for the taxable year, if— 

‘‘(A) the amount of the portion of the credit determined 

under such section with respect to such expenses, exceeds 

‘‘(B) the amount allowable as a deduction for such 

taxable year for such expenses (determined without regard 

to paragraph (1)), 

the amount chargeable to capital account for the taxable year 

for such expenses shall be reduced by the amount of such 

excess. 

‘‘(3) CONTROLLED GROUPS.—Paragraph (3) of subsection (b) 

shall apply for purposes of this subsection.’’. 

(d) CLERICAL AMENDMENT.—The table of sections for subpart 

E of part IV of subchapter A of chapter 1 of the Internal Revenue 

Code of 1986 is amended by inserting after the item relating to 

section 48C the following new item: 

‘‘Sec. 48D. Qualifying therapeutic discovery project credit.’’. 

(e) GRANTS FOR QUALIFIED INVESTMENTS IN THERAPEUTIC DISCOVERY PROJECTS IN LIEU OF TAX CREDITS.— 

(1) IN GENERAL.—Upon application, the Secretary of the 

Treasury shall, subject to the requirements of this subsection, 

provide a grant to each person who makes a qualified investment in a qualifying therapeutic discovery project in the amount 

of 50 percent of such investment. No grant shall be made 

under this subsection with respect to any investment unless 

such investment is made during a taxable year beginning in 

2009 or 2010. 

(2) APPLICATION.— 

(A) IN GENERAL.—At the stated election of the 

applicant, an application for certification under section 

48D(d)(2) of the Internal Revenue Code of 1986 for a credit 

under such section for the taxable year of the applicant 

which begins in 2009 shall be considered to be an application for a grant under paragraph (1) for such taxable year. 

(B) TAXABLE YEARS BEGINNING IN 2010.—An application 

for a grant under paragraph (1) for a taxable year beginning 

in 2010 shall be submitted— 

(i) not earlier than the day after the last day 

of such taxable year, and 

(ii) not later than the due date (including extensions) for filing the return of tax for such taxable 

year. 

(C) INFORMATION TO BE SUBMITTED.—An application 

for a grant under paragraph (1) shall include such information and be in such form as the Secretary may require 

to state the amount of the credit allowable (but for the 

receipt of a grant under this subsection) under section 

48D for the taxable year for the qualified investment with 

respect to which such application is made. 

(3) TIME FOR PAYMENT OF GRANT.— 

(A) IN GENERAL.—The Secretary of the Treasury shall 

make payment of the amount of any grant under paragraph 

(1) during the 30-day period beginning on the later of— 

(i) the date of the application for such grant, or 

(ii) the date the qualified investment for which 

the grant is being made is made. 
H. R. 3590—764 

(B) REGULATIONS.—In the case of investments of an 

ongoing nature, the Secretary shall issue regulations to 

determine the date on which a qualified investment shall 

be deemed to have been made for purposes of this paragraph. 

(4) QUALIFIED INVESTMENT.—For purposes of this subsection, the term ‘‘qualified investment’’ means a qualified 

investment that is certified under section 48D(d) of the Internal 

Revenue Code of 1986 for purposes of the credit under such 

section 48D. 

(5) APPLICATION OF CERTAIN RULES.— (A) IN GENERAL.—In making grants under this subsection, the Secretary of the Treasury shall apply rules 

similar to the rules of section 50 of the Internal Revenue 

Code of 1986. In applying such rules, any increase in 

tax under chapter 1 of such Code by reason of an investment ceasing to be a qualified investment shall be imposed 

on the person to whom the grant was made. 

(B) SPECIAL RULES.— 

(i) RECAPTURE OF EXCESSIVE GRANT AMOUNTS.— 

If the amount of a grant made under this subsection 

exceeds the amount allowable as a grant under this 

subsection, such excess shall be recaptured under 

subparagraph (A) as if the investment to which such 

excess portion of the grant relates had ceased to be 

a qualified investment immediately after such grant 

was made. 

(ii) GRANT INFORMATION NOT TREATED AS RETURN

INFORMATION.—In no event shall the amount of a grant 

made under paragraph (1), the identity of the person 

to whom such grant was made, or a description of 

the investment with respect to which such grant was 

made be treated as return information for purposes 

of section 6103 of the Internal Revenue Code of 1986. 

(6) EXCEPTION FOR CERTAIN NON-TAXPAYERS.—The Secretary of the Treasury shall not make any grant under this 

subsection to— 

(A) any Federal, State, or local government (or any 

political subdivision, agency, or instrumentality thereof), 

(B) any organization described in section 501(c) of the 

Internal Revenue Code of 1986 and exempt from tax under 

section 501(a) of such Code, 

(C) any entity referred to in paragraph (4) of section 

54(j) of such Code, or 

(D) any partnership or other pass-thru entity any 

partner (or other holder of an equity or profits interest) 

of which is described in subparagraph (A), (B) or (C). 

In the case of a partnership or other pass-thru entity described 

in subparagraph (D), partners and other holders of any equity 

or profits interest shall provide to such partnership or entity 

such information as the Secretary of the Treasury may require 

to carry out the purposes of this paragraph. 

(7) SECRETARY.—Any reference in this subsection to the 

Secretary of the Treasury shall be treated as including the 

Secretary’s delegate. 

(8) OTHER TERMS.—Any term used in this subsection which 

is also used in section 48D of the Internal Revenue Code 
H. R. 3590—765 

of 1986 shall have the same meaning for purposes of this 

subsection as when used in such section. 

(9) DENIAL OF DOUBLE BENEFIT.—No credit shall be allowed 

under section 46(6) of the Internal Revenue Code of 1986 by 

reason of section 48D of such Code for any investment for 

which a grant is awarded under this subsection. 

(10) APPROPRIATIONS.—There is hereby appropriated to the 

Secretary of the Treasury such sums as may be necessary 

to carry out this subsection. 

(11) TERMINATION.—The Secretary of the Treasury shall 

not make any grant to any person under this subsection unless 

the application of such person for such grant is received before 

January 1, 2013. 

(12) PROTECTING MIDDLE CLASS FAMILIES FROM TAX

INCREASES.—It is the sense of the Senate that the Senate 

should reject any procedural maneuver that would raise taxes 

on middle class families, such as a motion to commit the 

pending legislation to the Committee on Finance, which is 

designed to kill legislation that provides tax cuts for American 

workers and families, including the affordability tax credit and 

the small business tax credit. 

(f) EFFECTIVE DATE.—The amendments made by subsections 

(a) through (d) of this section shall apply to amounts paid or 

incurred after December 31, 2008, in taxable years beginning after 

such date. 

TITLE X—STRENGTHENING QUALITY, 

AFFORDABLE HEALTH CARE FOR ALL 

AMERICANS 

Subtitle A—Provisions Relating to Title I 

SEC. 10101. AMENDMENTS TO SUBTITLE A. 

(a) Section 2711 of the Public Health Service Act, as added 

by section 1001(5) of this Act, is amended to read as follows: 

‘‘SEC. 2711. NO LIFETIME OR ANNUAL LIMITS. 

‘‘(a) PROHIBITION.— 

‘‘(1) IN GENERAL.—A group health plan and a health insurance issuer offering group or individual health insurance coverage may not establish— 

‘‘(A) lifetime limits on the dollar value of benefits for 

any participant or beneficiary; or 

‘‘(B) except as provided in paragraph (2), annual limits 

on the dollar value of benefits for any participant or beneficiary. 

‘‘(2) ANNUAL LIMITS PRIOR TO 2014.—With respect to plan 

years beginning prior to January 1, 2014, a group health plan 

and a health insurance issuer offering group or individual 

health insurance coverage may only establish a restricted 

annual limit on the dollar value of benefits for any participant 

or beneficiary with respect to the scope of benefits that are 

essential health benefits under section 1302(b) of the Patient 
H. R. 3590—766 

Protection and Affordable Care Act, as determined by the Secretary. In defining the term ‘restricted annual limit’ for purposes of the preceding sentence, the Secretary shall ensure 

that access to needed services is made available with a minimal 

impact on premiums. 

‘‘(b) PER BENEFICIARY LIMITS.—Subsection (a) shall not be construed to prevent a group health plan or health insurance coverage 

from placing annual or lifetime per beneficiary limits on specific 

covered benefits that are not essential health benefits under section 

1302(b) of the Patient Protection and Affordable Care Act, to the 

extent that such limits are otherwise permitted under Federal 

or State law.’’. 

(b) Section 2715(a) of the Public Health Service Act, as added 

by section 1001(5) of this Act, is amended by striking ‘‘and providing 

to enrollees’’ and inserting ‘‘and providing to applicants, enrollees, 

and policyholders or certificate holders’’. 

(c) Subpart II of part A of title XXVII of the Public Health 

Service Act, as added by section 1001(5), is amended by inserting 

after section 2715, the following: 

‘‘SEC. 2715A. PROVISION OF ADDITIONAL INFORMATION. 

‘‘A group health plan and a health insurance issuer offering 

group or individual health insurance coverage shall comply with 

the provisions of section 1311(e)(3) of the Patient Protection and 

Affordable Care Act, except that a plan or coverage that is not 

offered through an Exchange shall only be required to submit 

the information required to the Secretary and the State insurance 

commissioner, and make such information available to the public.’’. 

(d) Section 2716 of the Public Health Service Act, as added 

by section 1001(5) of this Act, is amended to read as follows: 

‘‘SEC. 2716. PROHIBITION ON DISCRIMINATION IN FAVOR OF HIGHLY 

COMPENSATED INDIVIDUALS. 

‘‘(a) IN GENERAL.—A group health plan (other than a selfinsured plan) shall satisfy the requirements of section 105(h)(2) 

of the Internal Revenue Code of 1986 (relating to prohibition on 

discrimination in favor of highly compensated individuals). 

‘‘(b) RULES AND DEFINITIONS.—For purposes of this section— 

‘‘(1) CERTAIN RULES TO APPLY.—Rules similar to the rules 

contained in paragraphs (3), (4), and (8) of section 105(h) of 

such Code shall apply. 

‘‘(2) HIGHLY COMPENSATED INDIVIDUAL.—The term ‘highly 

compensated individual’ has the meaning given such term by 

section 105(h)(5) of such Code.’’. 

(e) Section 2717 of the Public Health Service Act, as added 

by section 1001(5) of this Act, is amended— 

(1) by redesignating subsections (c) and (d) as subsections 

(d) and (e), respectively; and 

(2) by inserting after subsection (b), the following: 

‘‘(c) PROTECTION OF SECOND AMENDMENT GUN RIGHTS.— 

‘‘(1) WELLNESS AND PREVENTION PROGRAMS.—A wellness 

and health promotion activity implemented under subsection 

(a)(1)(D) may not require the disclosure or collection of any 

information relating to— 

‘‘(A) the presence or storage of a lawfully-possessed 

firearm or ammunition in the residence or on the property 

of an individual; or 
H. R. 3590—767 

‘‘(B) the lawful use, possession, or storage of a firearm 

or ammunition by an individual. 

‘‘(2) LIMITATION ON DATA COLLECTION.—None of the 

authorities provided to the Secretary under the Patient Protection and Affordable Care Act or an amendment made by that 

Act shall be construed to authorize or may be used for the 

collection of any information relating to— 

‘‘(A) the lawful ownership or possession of a firearm 

or ammunition; 

‘‘(B) the lawful use of a firearm or ammunition; or 

‘‘(C) the lawful storage of a firearm or ammunition. 

‘‘(3) LIMITATION ON DATABASES OR DATA BANKS.—None of 

the authorities provided to the Secretary under the Patient 

Protection and Affordable Care Act or an amendment made 

by that Act shall be construed to authorize or may be used 

to maintain records of individual ownership or possession of 

a firearm or ammunition. 

‘‘(4) LIMITATION ON DETERMINATION OF PREMIUM RATES OR

ELIGIBILITY FOR HEALTH INSURANCE.—A premium rate may not 

be increased, health insurance coverage may not be denied, 

and a discount, rebate, or reward offered for participation in 

a wellness program may not be reduced or withheld under 

any health benefit plan issued pursuant to or in accordance 

with the Patient Protection and Affordable Care Act or an 

amendment made by that Act on the basis of, or on reliance 

upon— 

‘‘(A) the lawful ownership or possession of a firearm 

or ammunition; or 

‘‘(B) the lawful use or storage of a firearm or ammunition. 

‘‘(5) LIMITATION ON DATA COLLECTION REQUIREMENTS FOR

INDIVIDUALS.—No individual shall be required to disclose any 

information under any data collection activity authorized under 

the Patient Protection and Affordable Care Act or an amendment made by that Act relating to— 

‘‘(A) the lawful ownership or possession of a firearm 

or ammunition; or 

‘‘(B) the lawful use, possession, or storage of a firearm 

or ammunition.’’. 

(f) Section 2718 of the Public Health Service Act, as added 

by section 1001(5), is amended to read as follows: 

‘‘SEC. 2718. BRINGING DOWN THE COST OF HEALTH CARE COVERAGE. 

‘‘(a) CLEAR ACCOUNTING FOR COSTS.—A health insurance issuer 

offering group or individual health insurance coverage (including 

a grandfathered health plan) shall, with respect to each plan year, 

submit to the Secretary a report concerning the ratio of the incurred 

loss (or incurred claims) plus the loss adjustment expense (or change 

in contract reserves) to earned premiums. Such report shall include 

the percentage of total premium revenue, after accounting for collections or receipts for risk adjustment and risk corridors and payments of reinsurance, that such coverage expends— 

‘‘(1) on reimbursement for clinical services provided to 

enrollees under such coverage; 

‘‘(2) for activities that improve health care quality; and 
H. R. 3590—768 

‘‘(3) on all other non-claims costs, including an explanation 

of the nature of such costs, and excluding Federal and State 

taxes and licensing or regulatory fees. 

The Secretary shall make reports received under this section available to the public on the Internet website of the Department of 

Health and Human Services. 

‘‘(b) ENSURING THAT CONSUMERS RECEIVE VALUE FOR THEIR

PREMIUM PAYMENTS.— 

‘‘(1) REQUIREMENT TO PROVIDE VALUE FOR PREMIUM PAY- MENTS.— 

‘‘(A) REQUIREMENT.—Beginning not later than January 

1, 2011, a health insurance issuer offering group or individual health insurance coverage (including a grandfathered health plan) shall, with respect to each plan year, 

provide an annual rebate to each enrollee under such coverage, on a pro rata basis, if the ratio of the amount 

of premium revenue expended by the issuer on costs 

described in paragraphs (1) and (2) of subsection (a) to 

the total amount of premium revenue (excluding Federal 

and State taxes and licensing or regulatory fees and after 

accounting for payments or receipts for risk adjustment, 

risk corridors, and reinsurance under sections 1341, 1342, 

and 1343 of the Patient Protection and Affordable Care 

Act) for the plan year (except as provided in subparagraph 

(B)(ii)), is less than— 

‘‘(i) with respect to a health insurance issuer 

offering coverage in the large group market, 85 percent, 

or such higher percentage as a State may by regulation 

determine; or 

‘‘(ii) with respect to a health insurance issuer 

offering coverage in the small group market or in the 

individual market, 80 percent, or such higher percentage as a State may by regulation determine, except 

that the Secretary may adjust such percentage with 

respect to a State if the Secretary determines that 

the application of such 80 percent may destabilize the 

individual market in such State. 

‘‘(B) REBATE AMOUNT.— ‘‘(i) CALCULATION OF AMOUNT.—The total amount 

of an annual rebate required under this paragraph 

shall be in an amount equal to the product of— 

‘‘(I) the amount by which the percentage 

described in clause (i) or (ii) of subparagraph (A) 

exceeds the ratio described in such subparagraph; 

and 

‘‘(II) the total amount of premium revenue 

(excluding Federal and State taxes and licensing 

or regulatory fees and after accounting for payments or receipts for risk adjustment, risk corridors, and reinsurance under sections 1341, 1342, 

and 1343 of the Patient Protection and Affordable 

Care Act) for such plan year. 

‘‘(ii) CALCULATION BASED ON AVERAGE RATIO.— 

Beginning on January 1, 2014, the determination made 

under subparagraph (A) for the year involved shall 

be based on the averages of the premiums expended 

on the costs described in such subparagraph and total 
H. R. 3590—769 

premium revenue for each of the previous 3 years 

for the plan. 

‘‘(2) CONSIDERATION IN SETTING PERCENTAGES.—In determining the percentages under paragraph (1), a State shall 

seek to ensure adequate participation by health insurance 

issuers, competition in the health insurance market in the 

State, and value for consumers so that premiums are used 

for clinical services and quality improvements. 

‘‘(3) ENFORCEMENT.—The Secretary shall promulgate regulations for enforcing the provisions of this section and may 

provide for appropriate penalties. 

‘‘(c) DEFINITIONS.—Not later than December 31, 2010, and subject to the certification of the Secretary, the National Association 

of Insurance Commissioners shall establish uniform definitions of 

the activities reported under subsection (a) and standardized methodologies for calculating measures of such activities, including 

definitions of which activities, and in what regard such activities, 

constitute activities described in subsection (a)(2). Such methodologies shall be designed to take into account the special circumstances 

of smaller plans, different types of plans, and newer plans. 

‘‘(d) ADJUSTMENTS.—The Secretary may adjust the rates 

described in subsection (b) if the Secretary determines appropriate 

on account of the volatility of the individual market due to the 

establishment of State Exchanges. 

‘‘(e) STANDARD HOSPITAL CHARGES.—Each hospital operating 

within the United States shall for each year establish (and update) 

and make public (in accordance with guidelines developed by the 

Secretary) a list of the hospital’s standard charges for items and 

services provided by the hospital, including for diagnosis-related 

groups established under section 1886(d)(4) of the Social Security 

Act.’’. 

(g) Section 2719 of the Public Health Service Act, as added 

by section 1001(4) of this Act, is amended to read as follows: 

‘‘SEC. 2719. APPEALS PROCESS. 

‘‘(a) INTERNAL CLAIMS APPEALS.— ‘‘(1) IN GENERAL.—A group health plan and a health insurance issuer offering group or individual health insurance coverage shall implement an effective appeals process for appeals 

of coverage determinations and claims, under which the plan 

or issuer shall, at a minimum— 

‘‘(A) have in effect an internal claims appeal process; 

‘‘(B) provide notice to enrollees, in a culturally and 

linguistically appropriate manner, of available internal and 

external appeals processes, and the availability of any 

applicable office of health insurance consumer assistance 

or ombudsman established under section 2793 to assist 

such enrollees with the appeals processes; and 

‘‘(C) allow an enrollee to review their file, to present 

evidence and testimony as part of the appeals process, 

and to receive continued coverage pending the outcome 

of the appeals process. 

‘‘(2) ESTABLISHED PROCESSES.—To comply with paragraph 

(1)— 

‘‘(A) a group health plan and a health insurance issuer 

offering group health coverage shall provide an internal 

claims and appeals process that initially incorporates the 
H. R. 3590—770 

claims and appeals procedures (including urgent claims) 

set forth at section 2560.503–1 of title 29, Code of Federal 

Regulations, as published on November 21, 2000 (65 Fed. 

Reg. 70256), and shall update such process in accordance 

with any standards established by the Secretary of Labor 

for such plans and issuers; and 

‘‘(B) a health insurance issuer offering individual 

health coverage, and any other issuer not subject to 

subparagraph (A), shall provide an internal claims and 

appeals process that initially incorporates the claims and 

appeals procedures set forth under applicable law (as in 

existence on the date of enactment of this section), and 

shall update such process in accordance with any standards 

established by the Secretary of Health and Human Services 

for such issuers. 

‘‘(b) EXTERNAL REVIEW.—A group health plan and a health 

insurance issuer offering group or individual health insurance coverage— 

‘‘(1) shall comply with the applicable State external review 

process for such plans and issuers that, at a minimum, includes 

the consumer protections set forth in the Uniform External 

Review Model Act promulgated by the National Association 

of Insurance Commissioners and is binding on such plans; 

or 

‘‘(2) shall implement an effective external review process 

that meets minimum standards established by the Secretary 

through guidance and that is similar to the process described 

under paragraph (1)— 

‘‘(A) if the applicable State has not established an 

external review process that meets the requirements of 

paragraph (1); or 

‘‘(B) if the plan is a self-insured plan that is not subject 

to State insurance regulation (including a State law that 

establishes an external review process described in paragraph (1)). 

‘‘(c) SECRETARY AUTHORITY.—The Secretary may deem the 

external review process of a group health plan or health insurance 

issuer, in operation as of the date of enactment of this section, 

to be in compliance with the applicable process established under 

subsection (b), as determined appropriate by the Secretary.’’. 

(h) Subpart II of part A of title XVIII of the Public Health 

Service Act, as added by section 1001(5) of this Act, is amended 

by inserting after section 2719 the following: 

‘‘SEC. 2719A. PATIENT PROTECTIONS. 

‘‘(a) CHOICE OF HEALTH CARE PROFESSIONAL.—If a group health 

plan, or a health insurance issuer offering group or individual 

health insurance coverage, requires or provides for designation by 

a participant, beneficiary, or enrollee of a participating primary 

care provider, then the plan or issuer shall permit each participant, 

beneficiary, and enrollee to designate any participating primary 

care provider who is available to accept such individual. 

‘‘(b) COVERAGE OF EMERGENCY SERVICES.— 

‘‘(1) IN GENERAL.—If a group health plan, or a health insurance issuer offering group or individual health insurance issuer, 

provides or covers any benefits with respect to services in 

an emergency department of a hospital, the plan or issuer 
H. R. 3590—771 

shall cover emergency services (as defined in paragraph 

(2)(B))— 

‘‘(A) without the need for any prior authorization determination; 

‘‘(B) whether the health care provider furnishing such 

services is a participating provider with respect to such 

services; 

‘‘(C) in a manner so that, if such services are provided 

to a participant, beneficiary, or enrollee— 

‘‘(i) by a nonparticipating health care provider with 

or without prior authorization; or 

‘‘(ii)(I) such services will be provided without 

imposing any requirement under the plan for prior 

authorization of services or any limitation on coverage 

where the provider of services does not have a contractual relationship with the plan for the providing of 

services that is more restrictive than the requirements 

or limitations that apply to emergency department 

services received from providers who do have such 

a contractual relationship with the plan; and 

‘‘(II) if such services are provided out-of-network, 

the cost-sharing requirement (expressed as a 

copayment amount or coinsurance rate) is the same 

requirement that would apply if such services were 

provided in-network; 

‘‘(D) without regard to any other term or condition 

of such coverage (other than exclusion or coordination of 

benefits, or an affiliation or waiting period, permitted under 

section 2701 of this Act, section 701 of the Employee Retirement Income Security Act of 1974, or section 9801 of the 

Internal Revenue Code of 1986, and other than applicable 

cost-sharing). 

‘‘(2) DEFINITIONS.—In this subsection: 

‘‘(A) EMERGENCY MEDICAL CONDITION.—The term 

‘emergency medical condition’ means a medical condition 

manifesting itself by acute symptoms of sufficient severity 

(including severe pain) such that a prudent layperson, who 

possesses an average knowledge of health and medicine, 

could reasonably expect the absence of immediate medical 

attention to result in a condition described in clause (i), 

(ii), or (iii) of section 1867(e)(1)(A) of the Social Security 

Act. 

‘‘(B) EMERGENCY SERVICES.—The term ‘emergency services’ means, with respect to an emergency medical condition— 

‘‘(i) a medical screening examination (as required 

under section 1867 of the Social Security Act) that 

is within the capability of the emergency department 

of a hospital, including ancillary services routinely 

available to the emergency department to evaluate 

such emergency medical condition, and 

‘‘(ii) within the capabilities of the staff and facilities available at the hospital, such further medical 

examination and treatment as are required under section 1867 of such Act to stabilize the patient. 
H. R. 3590—772 

‘‘(C) STABILIZE.—The term ‘to stabilize’, with respect 

to an emergency medical condition (as defined in subparagraph (A)), has the meaning give in section 1867(e)(3) of 

the Social Security Act (42 U.S.C. 1395dd(e)(3)). 

‘‘(c) ACCESS TO PEDIATRIC CARE.— 

‘‘(1) PEDIATRIC CARE.—In the case of a person who has 

a child who is a participant, beneficiary, or enrollee under 

a group health plan, or health insurance coverage offered by 

a health insurance issuer in the group or individual market, 

if the plan or issuer requires or provides for the designation 

of a participating primary care provider for the child, the plan 

or issuer shall permit such person to designate a physician 

(allopathic or osteopathic) who specializes in pediatrics as the 

child’s primary care provider if such provider participates in 

the network of the plan or issuer. 

‘‘(2) CONSTRUCTION.—Nothing in paragraph (1) shall be 

construed to waive any exclusions of coverage under the terms 

and conditions of the plan or health insurance coverage with 

respect to coverage of pediatric care. 

‘‘(d) PATIENT ACCESS TO OBSTETRICAL AND GYNECOLOGICAL

CARE.— 

‘‘(1) GENERAL RIGHTS.— 

‘‘(A) DIRECT ACCESS.—A group health plan, or health 

insurance issuer offering group or individual health insurance coverage, described in paragraph (2) may not require 

authorization or referral by the plan, issuer, or any person 

(including a primary care provider described in paragraph 

(2)(B)) in the case of a female participant, beneficiary, 

or enrollee who seeks coverage for obstetrical or gynecological care provided by a participating health care professional who specializes in obstetrics or gynecology. Such 

professional shall agree to otherwise adhere to such plan’s 

or issuer’s policies and procedures, including procedures 

regarding referrals and obtaining prior authorization and 

providing services pursuant to a treatment plan (if any) 

approved by the plan or issuer. 

‘‘(B) OBSTETRICAL AND GYNECOLOGICAL CARE.—A group 

health plan or health insurance issuer described in paragraph (2) shall treat the provision of obstetrical and gynecological care, and the ordering of related obstetrical and 

gynecological items and services, pursuant to the direct 

access described under subparagraph (A), by a participating 

health care professional who specializes in obstetrics or 

gynecology as the authorization of the primary care provider. 

‘‘(2) APPLICATION OF PARAGRAPH.—A group health plan, 

or health insurance issuer offering group or individual health 

insurance coverage, described in this paragraph is a group 

health plan or coverage that— 

‘‘(A) provides coverage for obstetric or gynecologic care; 

and 

‘‘(B) requires the designation by a participant, beneficiary, or enrollee of a participating primary care provider. 

‘‘(3) CONSTRUCTION.—Nothing in paragraph (1) shall be 

construed to— 

‘‘(A) waive any exclusions of coverage under the terms 

and conditions of the plan or health insurance coverage 
H. R. 3590—773 

with respect to coverage of obstetrical or gynecological care; 

or 

‘‘(B) preclude the group health plan or health insurance 

issuer involved from requiring that the obstetrical or 

gynecological provider notify the primary care health care 

professional or the plan or issuer of treatment decisions.’’. 

(i) Section 2794 of the Public Health Service Act, as added 

by section 1003 of this Act, is amended— 

(1) in subsection (c)(1)— 

(A) in subparagraph (A), by striking ‘‘and’’ at the end; 

(B) in subparagraph (B), by striking the period and 

inserting ‘‘; and’’; and 

(C) by adding at the end the following: 

‘‘(C) in establishing centers (consistent with subsection 

(d)) at academic or other nonprofit institutions to collect 

medical reimbursement information from health insurance 

issuers, to analyze and organize such information, and 

to make such information available to such issuers, health 

care providers, health researchers, health care policy makers, and the general public.’’; and 

(2) by adding at the end the following: 

‘‘(d) MEDICAL REIMBURSEMENT DATA CENTERS.— 

‘‘(1) FUNCTIONS.—A center established under subsection 

(c)(1)(C) shall— 

‘‘(A) develop fee schedules and other database tools 

that fairly and accurately reflect market rates for medical 

services and the geographic differences in those rates; 

‘‘(B) use the best available statistical methods and 

data processing technology to develop such fee schedules 

and other database tools; 

‘‘(C) regularly update such fee schedules and other 

database tools to reflect changes in charges for medical 

services; 

‘‘(D) make health care cost information readily available to the public through an Internet website that allows 

consumers to understand the amounts that health care 

providers in their area charge for particular medical services; and 

‘‘(E) regularly publish information concerning the 

statistical methodologies used by the center to analyze 

health charge data and make such data available to 

researchers and policy makers. 

‘‘(2) CONFLICTS OF INTEREST.—A center established under 

subsection (c)(1)(C) shall adopt by-laws that ensures that the 

center (and all members of the governing board of the center) 

is independent and free from all conflicts of interest. Such 

by-laws shall ensure that the center is not controlled or influenced by, and does not have any corporate relation to, any 

individual or entity that may make or receive payments for 

health care services based on the center’s analysis of health 

care costs. 

‘‘(3) RULE OF CONSTRUCTION.—Nothing in this subsection 

shall be construed to permit a center established under subsection (c)(1)(C) to compel health insurance issuers to provide 

data to the center.’’. 
H. R. 3590—774 

SEC. 10102. AMENDMENTS TO SUBTITLE B. 

(a) Section 1102(a)(2)(B) of this Act is amended— 

(1) in the matter preceding clause (i), by striking ‘‘group 

health benefits plan’’ and inserting ‘‘group benefits plan providing health benefits’’; and 

(2) in clause (i)(I), by inserting ‘‘or any agency or instrumentality of any of the foregoing’’ before the closed parenthetical. 

(b) Section 1103(a) of this Act is amended— 

(1) in paragraph (1), by inserting ‘‘, or small business 

in,’’ after ‘‘residents of any’’; and 

(2) by striking paragraph (2) and inserting the following: 

‘‘(2) CONNECTING TO AFFORDABLE COVERAGE.—An Internet 

website established under paragraph (1) shall, to the extent 

practicable, provide ways for residents of, and small businesses 

in, any State to receive information on at least the following 

coverage options: 

‘‘(A) Health insurance coverage offered by health insurance issuers, other than coverage that provides reimbursement only for the treatment or mitigation of— 

‘‘(i) a single disease or condition; or 

‘‘(ii) an unreasonably limited set of diseases or 

conditions (as determined by the Secretary). 

‘‘(B) Medicaid coverage under title XIX of the Social 

Security Act. 

‘‘(C) Coverage under title XXI of the Social Security 

Act. 

‘‘(D) A State health benefits high risk pool, to the 

extent that such high risk pool is offered in such State; 

and 

‘‘(E) Coverage under a high risk pool under section 

1101. 

‘‘(F) Coverage within the small group market for small 

businesses and their employees, including reinsurance for 

early retirees under section 1102, tax credits available 

under section 45R of the Internal Revenue Code of 1986 

(as added by section 1421), and other information specifically for small businesses regarding affordable health care 

options.’’. 

SEC. 10103. AMENDMENTS TO SUBTITLE C. 

(a) Section 2701(a)(5) of the Public Health Service Act, as 

added by section 1201(4) of this Act, is amended by inserting 

‘‘(other than self-insured group health plans offered in such market)’’ 

after ‘‘such market’’. 

(b) Section 2708 of the Public Health Service Act, as added 

by section 1201(4) of this Act, is amended by striking ‘‘or individual’’. 

(c) Subpart I of part A of title XXVII of the Public Health 

Service Act, as added by section 1201(4) of this Act, is amended 

by inserting after section 2708, the following: 

‘‘SEC. 2709. COVERAGE FOR INDIVIDUALS PARTICIPATING IN 

APPROVED CLINICAL TRIALS. 

‘‘(a) COVERAGE.— 

‘‘(1) IN GENERAL.—If a group health plan or a health insurance issuer offering group or individual health insurance coverage provides coverage to a qualified individual, then such 

plan or issuer— 
H. R. 3590—775 

‘‘(A) may not deny the individual participation in the 

clinical trial referred to in subsection (b)(2); 

‘‘(B) subject to subsection (c), may not deny (or limit 

or impose additional conditions on) the coverage of routine 

patient costs for items and services furnished in connection 

with participation in the trial; and 

‘‘(C) may not discriminate against the individual on 

the basis of the individual’s participation in such trial. 

‘‘(2) ROUTINE PATIENT COSTS.— 

‘‘(A) INCLUSION.—For purposes of paragraph (1)(B), 

subject to subparagraph (B), routine patient costs include 

all items and services consistent with the coverage provided 

in the plan (or coverage) that is typically covered for a 

qualified individual who is not enrolled in a clinical trial. 

‘‘(B) EXCLUSION.—For purposes of paragraph (1)(B), 

routine patient costs does not include— 

‘‘(i) the investigational item, device, or service, 

itself; 

‘‘(ii) items and services that are provided solely 

to satisfy data collection and analysis needs and that 

are not used in the direct clinical management of the 

patient; or 

‘‘(iii) a service that is clearly inconsistent with 

widely accepted and established standards of care for 

a particular diagnosis. 

‘‘(3) USE OF IN-NETWORK PROVIDERS.—If one or more participating providers is participating in a clinical trial, nothing 

in paragraph (1) shall be construed as preventing a plan or 

issuer from requiring that a qualified individual participate 

in the trial through such a participating provider if the provider 

will accept the individual as a participant in the trial. 

‘‘(4) USE OF OUT-OF-NETWORK.—Notwithstanding paragraph 

(3), paragraph (1) shall apply to a qualified individual participating in an approved clinical trial that is conducted outside 

the State in which the qualified individual resides. 

‘‘(b) QUALIFIED INDIVIDUAL DEFINED.—For purposes of subsection (a), the term ‘qualified individual’ means an individual 

who is a participant or beneficiary in a health plan or with coverage 

described in subsection (a)(1) and who meets the following conditions: 

‘‘(1) The individual is eligible to participate in an approved 

clinical trial according to the trial protocol with respect to 

treatment of cancer or other life-threatening disease or condition. 

‘‘(2) Either— 

‘‘(A) the referring health care professional is a participating health care provider and has concluded that the 

individual’s participation in such trial would be appropriate 

based upon the individual meeting the conditions described 

in paragraph (1); or 

‘‘(B) the participant or beneficiary provides medical 

and scientific information establishing that the individual’s 

participation in such trial would be appropriate based upon 

the individual meeting the conditions described in paragraph (1). 

‘‘(c) LIMITATIONS ON COVERAGE.—This section shall not be construed to require a group health plan, or a health insurance issuer 
H. R. 3590—776 

offering group or individual health insurance coverage, to provide 

benefits for routine patient care services provided outside of the 

plan’s (or coverage’s) health care provider network unless out-ofnetwork benefits are otherwise provided under the plan (or coverage). 

‘‘(d) APPROVED CLINICAL TRIAL DEFINED.— 

‘‘(1) IN GENERAL.—In this section, the term ‘approved clinical trial’ means a phase I, phase II, phase III, or phase IV 

clinical trial that is conducted in relation to the prevention, 

detection, or treatment of cancer or other life-threatening disease or condition and is described in any of the following 

subparagraphs: 

‘‘(A) FEDERALLY FUNDED TRIALS.—The study or investigation is approved or funded (which may include funding 

through in-kind contributions) by one or more of the following: 

‘‘(i) The National Institutes of Health. 

‘‘(ii) The Centers for Disease Control and Prevention. 

‘‘(iii) The Agency for Health Care Research and 

Quality. 

‘‘(iv) The Centers for Medicare & Medicaid Services. 

‘‘(v) cooperative group or center of any of the entities described in clauses (i) through (iv) or the Department of Defense or the Department of Veterans Affairs. 

‘‘(vi) A qualified non-governmental research entity 

identified in the guidelines issued by the National 

Institutes of Health for center support grants. 

‘‘(vii) Any of the following if the conditions 

described in paragraph (2) are met: 

‘‘(I) The Department of Veterans Affairs. 

‘‘(II) The Department of Defense. 

‘‘(III) The Department of Energy. 

‘‘(B) The study or investigation is conducted under 

an investigational new drug application reviewed by the 

Food and Drug Administration. 

‘‘(C) The study or investigation is a drug trial that 

is exempt from having such an investigational new drug 

application. 

‘‘(2) CONDITIONS FOR DEPARTMENTS.—The conditions 

described in this paragraph, for a study or investigation conducted by a Department, are that the study or investigation 

has been reviewed and approved through a system of peer 

review that the Secretary determines— 

‘‘(A) to be comparable to the system of peer review 

of studies and investigations used by the National 

Institutes of Health, and 

‘‘(B) assures unbiased review of the highest scientific 

standards by qualified individuals who have no interest 

in the outcome of the review. 

‘‘(e) LIFE-THREATENING CONDITION DEFINED.—In this section, 

the term ‘life-threatening condition’ means any disease or condition 

from which the likelihood of death is probable unless the course 

of the disease or condition is interrupted. 

‘‘(f) CONSTRUCTION.—Nothing in this section shall be construed 

to limit a plan’s or issuer’s coverage with respect to clinical trials. 
H. R. 3590—777 

‘‘(g) APPLICATION TO FEHBP.—Notwithstanding any provision 

of chapter 89 of title 5, United States Code, this section shall 

apply to health plans offered under the program under such chapter. 

‘‘(h) PREEMPTION.—Notwithstanding any other provision of this 

Act, nothing in this section shall preempt State laws that require 

a clinical trials policy for State regulated health insurance plans 

that is in addition to the policy required under this section.’’. 

(d) Section 1251(a) of this Act is amended— 

(1) in paragraph (2), by striking ‘‘With’’ and inserting 

‘‘Except as provided in paragraph (3), with’’; and 

(2) by adding at the end the following: 

‘‘(3) APPLICATION OF CERTAIN PROVISIONS.—The provisions 

of sections 2715 and 2718 of the Public Health Service Act 

(as added by subtitle A) shall apply to grandfathered health 

plans for plan years beginning on or after the date of enactment 

of this Act.’’. 

(e) Section 1253 of this Act is amended insert before the period 

the following: ‘‘, except that— 

‘‘(1) section 1251 shall take effect on the date of enactment 

of this Act; and 

‘‘(2) the provisions of section 2704 of the Public Health 

Service Act (as amended by section 1201), as they apply to 

enrollees who are under 19 years of age, shall become effective 

for plan years beginning on or after the date that is 6 months 

after the date of enactment of this Act.’’. 

(f) Subtitle C of title I of this Act is amended— 

(1) by redesignating section 1253 as section 1255; and 

(2) by inserting after section 1252, the following: 

‘‘SEC. 1253. ANNUAL REPORT ON SELF-INSURED PLANS. 

‘‘Not later than 1 year after the date of enactment of this 

Act, and annually thereafter, the Secretary of Labor shall prepare 

an aggregate annual report, using data collected from the Annual 

Return/Report of Employee Benefit Plan (Department of Labor Form 

5500), that shall include general information on self-insured group 

health plans (including plan type, number of participants, benefits 

offered, funding arrangements, and benefit arrangements) as well 

as data from the financial filings of self-insured employers 

(including information on assets, liabilities, contributions, investments, and expenses). The Secretary shall submit such reports 

to the appropriate committees of Congress. 

‘‘SEC. 1254. STUDY OF LARGE GROUP MARKET. 

‘‘(a) IN GENERAL.—The Secretary of Health and Human Services 

shall conduct a study of the fully-insured and self-insured group 

health plan markets to— 

‘‘(1) compare the characteristics of employers (including 

industry, size, and other characteristics as determined appropriate by the Secretary), health plan benefits, financial solvency, capital reserve levels, and the risks of becoming insolvent; and 

‘‘(2) determine the extent to which new insurance market 

reforms are likely to cause adverse selection in the large group 

market or to encourage small and midsize employers to selfinsure. 

‘‘(b) COLLECTION OF INFORMATION.—In conducting the study 

under subsection (a), the Secretary, in coordination with the Secretary of Labor, shall collect information and analyze— 
H. R. 3590—778 

‘‘(1) the extent to which self-insured group health plans 

can offer less costly coverage and, if so, whether lower costs 

are due to more efficient plan administration and lower overhead or to the denial of claims and the offering very limited 

benefit packages; 

‘‘(2) claim denial rates, plan benefit fluctuations (to 

evaluate the extent that plans scale back health benefits during 

economic downturns), and the impact of the limited recourse 

options on consumers; and 

‘‘(3) any potential conflict of interest as it relates to the 

health care needs of self-insured enrollees and self-insured 

employer’s financial contribution or profit margin, and the 

impact of such conflict on administration of the health plan. 

‘‘(c) REPORT.—Not later than 1 year after the date of enactment 

of this Act, the Secretary shall submit to the appropriate committees 

of Congress a report concerning the results of the study conducted 

under subsection (a).’’. 

SEC. 10104. AMENDMENTS TO SUBTITLE D. 

(a) Section 1301(a) of this Act is amended by striking paragraph 

(2) and inserting the following: 

‘‘(2) INCLUSION OF CO–OP PLANS AND MULTI-STATE QUALIFIED HEALTH PLANS.—Any reference in this title to a qualified 

health plan shall be deemed to include a qualified health plan 

offered through the CO–OP program under section 1322, and 

a multi-State plan under section 1334, unless specifically provided for otherwise. 

‘‘(3) TREATMENT OF QUALIFIED DIRECT PRIMARY CARE MEDICAL HOME PLANS.—The Secretary of Health and Human Services shall permit a qualified health plan to provide coverage 

through a qualified direct primary care medical home plan 

that meets criteria established by the Secretary, so long as 

the qualified health plan meets all requirements that are otherwise applicable and the services covered by the medical home 

plan are coordinated with the entity offering the qualified 

health plan. 

‘‘(4) VARIATION BASED ON RATING AREA.—A qualified health 

plan, including a multi-State qualified health plan, may as 

appropriate vary premiums by rating area (as defined in section 

2701(a)(2) of the Public Health Service Act).’’. 

(b) Section 1302 of this Act is amended— 

(1) in subsection (d)(2)(B), by striking ‘‘may issue’’ and 

inserting ‘‘shall issue’’; and 

(2) by adding at the end the following: 

‘‘(g) PAYMENTS TO FEDERALLY-QUALIFIED HEALTH CENTERS.— 

If any item or service covered by a qualified health plan is provided 

by a Federally-qualified health center (as defined in section 

1905(l)(2)(B) of the Social Security Act (42 U.S.C. 1396d(l)(2)(B)) 

to an enrollee of the plan, the offeror of the plan shall pay to 

the center for the item or service an amount that is not less 

than the amount of payment that would have been paid to the 

center under section 1902(bb) of such Act (42 U.S.C. 1396a(bb)) 

for such item or service.’’. 

(c) Section 1303 of this Act is amended to read as follows: 

‘‘SEC. 1303. SPECIAL RULES. 

‘‘(a) STATE OPT-OUT OF ABORTION COVERAGE.— 
H. R. 3590—779 

‘‘(1) IN GENERAL.—A State may elect to prohibit abortion 

coverage in qualified health plans offered through an Exchange 

in such State if such State enacts a law to provide for such 

prohibition. 

‘‘(2) TERMINATION OF OPT OUT.—A State may repeal a law 

described in paragraph (1) and provide for the offering of such 

services through the Exchange. 

‘‘(b) SPECIAL RULES RELATING TO COVERAGE OF ABORTION SERVICES.— 

‘‘(1) VOLUNTARY CHOICE OF COVERAGE OF ABORTION SERVICES.— 

‘‘(A) IN GENERAL.—Notwithstanding any other provision of this title (or any amendment made by this title)— 

‘‘(i) nothing in this title (or any amendment made 

by this title), shall be construed to require a qualified 

health plan to provide coverage of services described 

in subparagraph (B)(i) or (B)(ii) as part of its essential 

health benefits for any plan year; and 

‘‘(ii) subject to subsection (a), the issuer of a qualified health plan shall determine whether or not the 

plan provides coverage of services described in subparagraph (B)(i) or (B)(ii) as part of such benefits for the 

plan year. 

‘‘(B) ABORTION SERVICES.— 

‘‘(i) ABORTIONS FOR WHICH PUBLIC FUNDING IS

PROHIBITED.—The services described in this clause are 

abortions for which the expenditure of Federal funds 

appropriated for the Department of Health and Human 

Services is not permitted, based on the law as in effect 

as of the date that is 6 months before the beginning 

of the plan year involved. 

‘‘(ii) ABORTIONS FOR WHICH PUBLIC FUNDING IS

ALLOWED.—The services described in this clause are 

abortions for which the expenditure of Federal funds 

appropriated for the Department of Health and Human 

Services is permitted, based on the law as in effect 

as of the date that is 6 months before the beginning 

of the plan year involved. 

‘‘(2) PROHIBITION ON THE USE OF FEDERAL FUNDS.— 

‘‘(A) IN GENERAL.—If a qualified health plan provides 

coverage of services described in paragraph (1)(B)(i), the 

issuer of the plan shall not use any amount attributable 

to any of the following for purposes of paying for such 

services: 

‘‘(i) The credit under section 36B of the Internal 

Revenue Code of 1986 (and the amount (if any) of 

the advance payment of the credit under section 1412 

of the Patient Protection and Affordable Care Act). 

‘‘(ii) Any cost-sharing reduction under section 1402 

of the Patient Protection and Affordable Care Act (and 

the amount (if any) of the advance payment of the 

reduction under section 1412 of the Patient Protection 

and Affordable Care Act). 

‘‘(B) ESTABLISHMENT OF ALLOCATION ACCOUNTS.—In 

the case of a plan to which subparagraph (A) applies, 

the issuer of the plan shall— 
H. R. 3590—780 

‘‘(i) collect from each enrollee in the plan (without 

regard to the enrollee’s age, sex, or family status) 

a separate payment for each of the following: 

‘‘(I) an amount equal to the portion of the 

premium to be paid directly by the enrollee for 

coverage under the plan of services other than 

services described in paragraph (1)(B)(i) (after 

reduction for credits and cost-sharing reductions 

described in subparagraph (A)); and 

‘‘(II) an amount equal to the actuarial value 

of the coverage of services described in paragraph 

(1)(B)(i), and 

‘‘(ii) shall deposit all such separate payments into 

separate allocation accounts as provided in subparagraph (C). 

In the case of an enrollee whose premium for coverage 

under the plan is paid through employee payroll deposit, 

the separate payments required under this subparagraph 

shall each be paid by a separate deposit. 

‘‘(C) SEGREGATION OF FUNDS.— 

‘‘(i) IN GENERAL.—The issuer of a plan to which 

subparagraph (A) applies shall establish allocation 

accounts described in clause (ii) for enrollees receiving 

amounts described in subparagraph (A). 

‘‘(ii) ALLOCATION ACCOUNTS.—The issuer of a plan 

to which subparagraph (A) applies shall deposit— 

‘‘(I) all payments described in subparagraph 

(B)(i)(I) into a separate account that consists solely 

of such payments and that is used exclusively to 

pay for services other than services described in 

paragraph (1)(B)(i); and 

‘‘(II) all payments described in subparagraph 

(B)(i)(II) into a separate account that consists 

solely of such payments and that is used exclusively to pay for services described in paragraph 

(1)(B)(i). 

‘‘(D) ACTUARIAL VALUE.— 

‘‘(i) IN GENERAL.—The issuer of a qualified health 

plan shall estimate the basic per enrollee, per month 

cost, determined on an average actuarial basis, for 

including coverage under the qualified health plan of 

the services described in paragraph (1)(B)(i). 

‘‘(ii) CONSIDERATIONS.—In making such estimate, 

the issuer— 

‘‘(I) may take into account the impact on 

overall costs of the inclusion of such coverage, 

but may not take into account any cost reduction 

estimated to result from such services, including 

prenatal care, delivery, or postnatal care; 

‘‘(II) shall estimate such costs as if such coverage were included for the entire population covered; and 

‘‘(III) may not estimate such a cost at less 

than $1 per enrollee, per month. 

‘‘(E) ENSURING COMPLIANCE WITH SEGREGATION

REQUIREMENTS.— 
H. R. 3590—781 

‘‘(i) IN GENERAL.—Subject to clause (ii), State 

health insurance commissioners shall ensure that 

health plans comply with the segregation requirements 

in this subsection through the segregation of plan funds 

in accordance with applicable provisions of generally 

accepted accounting requirements, circulars on funds 

management of the Office of Management and Budget, 

and guidance on accounting of the Government 

Accountability Office. 

‘‘(ii) CLARIFICATION.—Nothing in clause (i) shall 

prohibit the right of an individual or health plan to 

appeal such action in courts of competent jurisdiction. 

‘‘(3) RULES RELATING TO NOTICE.— 

‘‘(A) NOTICE.—A qualified health plan that provides 

for coverage of the services described in paragraph (1)(B)(i) 

shall provide a notice to enrollees, only as part of the 

summary of benefits and coverage explanation, at the time 

of enrollment, of such coverage. 

‘‘(B) RULES RELATING TO PAYMENTS.—The notice 

described in subparagraph (A), any advertising used by 

the issuer with respect to the plan, any information provided by the Exchange, and any other information specified 

by the Secretary shall provide information only with respect 

to the total amount of the combined payments for services 

described in paragraph (1)(B)(i) and other services covered 

by the plan. 

‘‘(4) NO DISCRIMINATION ON BASIS OF PROVISION OF ABOR- TION.—No qualified health plan offered through an Exchange 

may discriminate against any individual health care provider 

or health care facility because of its unwillingness to provide, 

pay for, provide coverage of, or refer for abortions 

‘‘(c) APPLICATION OF STATE AND FEDERAL LAWS REGARDING

ABORTION.— 

‘‘(1) NO PREEMPTION OF STATE LAWS REGARDING ABOR- TION.—Nothing in this Act shall be construed to preempt or 

otherwise have any effect on State laws regarding the prohibition of (or requirement of) coverage, funding, or procedural 

requirements on abortions, including parental notification or 

consent for the performance of an abortion on a minor. 

‘‘(2) NO EFFECT ON FEDERAL LAWS REGARDING ABORTION.— 

‘‘(A) IN GENERAL.—Nothing in this Act shall be construed to have any effect on Federal laws regarding— 

‘‘(i) conscience protection; 

‘‘(ii) willingness or refusal to provide abortion; and 

‘‘(iii) discrimination on the basis of the willingness 

or refusal to provide, pay for, cover, or refer for abortion 

or to provide or participate in training to provide abortion. 

‘‘(3) NO EFFECT ON FEDERAL CIVIL RIGHTS LAW.—Nothing 

in this subsection shall alter the rights and obligations of 

employees and employers under title VII of the Civil Rights 

Act of 1964. 

‘‘(d) APPLICATION OF EMERGENCY SERVICES LAWS.—Nothing in 

this Act shall be construed to relieve any health care provider 

from providing emergency services as required by State or Federal 

law, including section 1867 of the Social Security Act (popularly 

known as ‘EMTALA’).’’. 
H. R. 3590—782 

(d) Section 1304 of this Act is amended by adding at the 

end the following: 

‘‘(e) EDUCATED HEALTH CARE CONSUMERS.—The term ‘educated 

health care consumer’ means an individual who is knowledgeable 

about the health care system, and has background or experience 

in making informed decisions regarding health, medical, and scientific matters.’’. 

(e) Section 1311(d) of this Act is amended— 

(1) in paragraph (3)(B), by striking clause (ii) and inserting 

the following: 

‘‘(ii) STATE MUST ASSUME COST.—A State shall 

make payments— 

‘‘(I) to an individual enrolled in a qualified 

health plan offered in such State; or 

‘‘(II) on behalf of an individual described in 

subclause (I) directly to the qualified health plan 

in which such individual is enrolled; 

to defray the cost of any additional benefits described 

in clause (i).’’; and 

(2) in paragraph (6)(A), by inserting ‘‘educated’’ before 

‘‘health care’’. 

(f) Section 1311(e) of this Act is amended— 

(1) in paragraph (2), by striking ‘‘may’’ in the second sentence and inserting ‘‘shall’’; and 

(2) by adding at the end the following: 

‘‘(3) TRANSPARENCY IN COVERAGE.— 

‘‘(A) IN GENERAL.—The Exchange shall require health 

plans seeking certification as qualified health plans to 

submit to the Exchange, the Secretary, the State insurance 

commissioner, and make available to the public, accurate 

and timely disclosure of the following information: 

‘‘(i) Claims payment policies and practices. 

‘‘(ii) Periodic financial disclosures. 

‘‘(iii) Data on enrollment. 

‘‘(iv) Data on disenrollment. 

‘‘(v) Data on the number of claims that are denied. 

‘‘(vi) Data on rating practices. 

‘‘(vii) Information on cost-sharing and payments 

with respect to any out-of-network coverage. 

‘‘(viii) Information on enrollee and participant 

rights under this title. 

‘‘(ix) Other information as determined appropriate 

by the Secretary. 

‘‘(B) USE OF PLAIN LANGUAGE.—The information 

required to be submitted under subparagraph (A) shall 

be provided in plain language. The term ‘plain language’ 

means language that the intended audience, including 

individuals with limited English proficiency, can readily 

understand and use because that language is concise, wellorganized, and follows other best practices of plain language writing. The Secretary and the Secretary of Labor 

shall jointly develop and issue guidance on best practices 

of plain language writing. 

‘‘(C) COST SHARING TRANSPARENCY.—The Exchange 

shall require health plans seeking certification as qualified 

health plans to permit individuals to learn the amount 

of cost-sharing (including deductibles, copayments, and 
H. R. 3590—783 

coinsurance) under the individual’s plan or coverage that 

the individual would be responsible for paying with respect 

to the furnishing of a specific item or service by a participating provider in a timely manner upon the request of 

the individual. At a minimum, such information shall be 

made available to such individual through an Internet 

website and such other means for individuals without 

access to the Internet. 

‘‘(D) GROUP HEALTH PLANS.—The Secretary of Labor 

shall update and harmonize the Secretary’s rules concerning the accurate and timely disclosure to participants 

by group health plans of plan disclosure, plan terms and 

conditions, and periodic financial disclosure with the standards established by the Secretary under subparagraph 

(A).’’. 

(g) Section 1311(g)(1) of this Act is amended— 

(1) in subparagraph (C), by striking ‘‘; and’’ and inserting 

a semicolon; 

(2) in subparagraph (D), by striking the period and 

inserting ‘‘; and’’; and 

(3) by adding at the end the following: 

‘‘(E) the implementation of activities to reduce health 

and health care disparities, including through the use of 

language services, community outreach, and cultural competency trainings.’’. 

(h) Section 1311(i)(2)((B) of this Act is amended by striking 

‘‘small business development centers’’ and inserting ‘‘resource partners of the Small Business Administration’’. 

(i) Section 1312 of this Act is amended— 

(1) in subsection (a)(1), by inserting ‘‘and for which such 

individual is eligible’’ before the period; 

(2) in subsection (e)— 

(A) in paragraph (1), by inserting ‘‘and employers’’ 

after ‘‘enroll individuals’’; and 

(B) by striking the flush sentence at the end; and 

(3) in subsection (f)(1)(A)(ii), by striking the parenthetical. 

(j)(1) Subparagraph (B) of section 1313(a)(6) of this Act is 

hereby deemed null, void, and of no effect. 

(2) Section 3730(e) of title 31, United States Code, is amended 

by striking paragraph (4) and inserting the following: 

‘‘(4)(A) The court shall dismiss an action or claim under 

this section, unless opposed by the Government, if substantially 

the same allegations or transactions as alleged in the action 

or claim were publicly disclosed— 

‘‘(i) in a Federal criminal, civil, or administrative 

hearing in which the Government or its agent is a party; 

‘‘(ii) in a congressional, Government Accountability 

Office, or other Federal report, hearing, audit, or investigation; or 

‘‘(iii) from the news media, 

unless the action is brought by the Attorney General or the 

person bringing the action is an original source of the information. 

‘‘(B) For purposes of this paragraph, ‘‘original source’’ 

means an individual who either (i) prior to a public disclosure 

under subsection (e)(4)(a), has voluntarily disclosed to the 
H. R. 3590—784 

Government the information on which allegations or transactions in a claim are based, or (2) who has knowledge that 

is independent of and materially adds to the publicly disclosed 

allegations or transactions, and who has voluntarily provided 

the information to the Government before filing an action under 

this section.’’. 

(k) Section 1313(b) of this Act is amended— 

(1) in paragraph (3), by striking ‘‘and’’ at the end; 

(2) by redesignating paragraph (4) as paragraph (5); and 

(3) by inserting after paragraph (3) the following: 

‘‘(4) a survey of the cost and affordability of health care 

insurance provided under the Exchanges for owners and 

employees of small business concerns (as defined under section 

3 of the Small Business Act (15 U.S.C. 632)), including data 

on enrollees in Exchanges and individuals purchasing health 

insurance coverage outside of Exchanges; and’’. 

(l) Section 1322(b) of this Act is amended— 

(1) by redesignating paragraph (3) as paragraph (4); and 

(2) by inserting after paragraph (2), the following: 

‘‘(3) REPAYMENT OF LOANS AND GRANTS.—Not later than 

July 1, 2013, and prior to awarding loans and grants under 

the CO–OP program, the Secretary shall promulgate regulations with respect to the repayment of such loans and grants 

in a manner that is consistent with State solvency regulations 

and other similar State laws that may apply. In promulgating 

such regulations, the Secretary shall provide that such loans 

shall be repaid within 5 years and such grants shall be repaid 

within 15 years, taking into consideration any appropriate State 

reserve requirements, solvency regulations, and requisite surplus note arrangements that must be constructed in a State 

to provide for such repayment prior to awarding such loans 

and grants.’’. 

(m) Part III of subtitle D of title I of this Act is amended 

by striking section 1323. 

(n) Section 1324(a) of this Act is amended by striking ‘‘, a 

community health’’ and all that follows through ‘‘1333(b)’’ and 

inserting ‘‘, or a multi-State qualified health plan under section 

1334’’. 

(o) Section 1331 of this Act is amended— 

(1) in subsection (d)(3)(A)(i), by striking ‘‘85’’ and inserting 

‘‘95’’; and 

(2) in subsection (e)(1)(B), by inserting before the semicolon 

the following: ‘‘, or, in the case of an alien lawfully present 

in the United States, whose income is not greater than 133 

percent of the poverty line for the size of the family involved 

but who is not eligible for the Medicaid program under title 

XIX of the Social Security Act by reason of such alien status’’. 

(p) Section 1333 of this Act is amended by striking subsection 

(b). 

(q) Part IV of subtitle D of title I of this Act is amended 

by adding at the end the following: 

‘‘SEC. 1334. MULTI-STATE PLANS. 

‘‘(a) OVERSIGHT BY THE OFFICE OF PERSONNEL MANAGEMENT.— ‘‘(1) IN GENERAL.—The Director of the Office of Personnel 

Management (referred to in this section as the ‘Director’) shall 

enter into contracts with health insurance issuers (which may 
H. R. 3590—785 

include a group of health insurance issuers affiliated either 

by common ownership and control or by the common use of 

a nationally licensed service mark), without regard to section 

5 of title 41, United States Code, or other statutes requiring 

competitive bidding, to offer at least 2 multi-State qualified 

health plans through each Exchange in each State. Such plans 

shall provide individual, or in the case of small employers, 

group coverage. 

‘‘(2) TERMS.—Each contract entered into under paragraph 

(1) shall be for a uniform term of at least 1 year, but may 

be made automatically renewable from term to term in the 

absence of notice of termination by either party. In entering 

into such contracts, the Director shall ensure that health benefits coverage is provided in accordance with the types of coverage provided for under section 2701(a)(1)(A)(i) of the Public 

Health Service Act. 

‘‘(3) NON-PROFIT ENTITIES.—In entering into contracts 

under paragraph (1), the Director shall ensure that at least 

one contract is entered into with a non-profit entity. 

‘‘(4) ADMINISTRATION.—The Director shall implement this 

subsection in a manner similar to the manner in which the 

Director implements the contracting provisions with respect 

to carriers under the Federal employees health benefit program 

under chapter 89 of title 5, United States Code, including 

(through negotiating with each multi-state plan)— 

‘‘(A) a medical loss ratio; 

‘‘(B) a profit margin; 

‘‘(C) the premiums to be charged; and 

‘‘(D) such other terms and conditions of coverage as 

are in the interests of enrollees in such plans. 

‘‘(5) AUTHORITY TO PROTECT CONSUMERS.—The Director 

may prohibit the offering of any multi-State health plan that 

does not meet the terms and conditions defined by the Director 

with respect to the elements described in subparagraphs (A) 

through (D) of paragraph (4). 

‘‘(6) ASSURED AVAILABILITY OF VARIED COVERAGE.—In 

entering into contracts under this subsection, the Director shall 

ensure that with respect to multi-State qualified health plans 

offered in an Exchange, there is at least one such plan that 

does not provide coverage of services described in section 

1303(b)(1)(B)(i). 

‘‘(7) WITHDRAWAL.—Approval of a contract under this subsection may be withdrawn by the Director only after notice 

and opportunity for hearing to the issuer concerned without 

regard to subchapter II of chapter 5 and chapter 7 of title 

5, United States Code. 

‘‘(b) ELIGIBILITY.—A health insurance issuer shall be eligible 

to enter into a contract under subsection (a)(1) if such issuer— 

‘‘(1) agrees to offer a multi-State qualified health plan 

that meets the requirements of subsection (c) in each Exchange 

in each State; 

‘‘(2) is licensed in each State and is subject to all requirements of State law not inconsistent with this section, including 

the standards and requirements that a State imposes that 

do not prevent the application of a requirement of part A 

of title XXVII of the Public Health Service Act or a requirement 

of this title; 
H. R. 3590—786 

‘‘(3) otherwise complies with the minimum standards prescribed for carriers offering health benefits plans under section 

8902(e) of title 5, United States Code, to the extent that such 

standards do not conflict with a provision of this title; and 

‘‘(4) meets such other requirements as determined appropriate by the Director, in consultation with the Secretary. 

‘‘(c) REQUIREMENTS FOR MULTI-STATE QUALIFIED HEALTH

PLAN.— 

‘‘(1) IN GENERAL.—A multi-State qualified health plan 

meets the requirements of this subsection if, in the determination of the Director— 

‘‘(A) the plan offers a benefits package that is uniform 

in each State and consists of the essential benefits 

described in section 1302; 

‘‘(B) the plan meets all requirements of this title with 

respect to a qualified health plan, including requirements 

relating to the offering of the bronze, silver, and gold levels 

of coverage and catastrophic coverage in each State 

Exchange; 

‘‘(C) except as provided in paragraph (5), the issuer 

provides for determinations of premiums for coverage under 

the plan on the basis of the rating requirements of part 

A of title XXVII of the Public Health Service Act; and 

‘‘(D) the issuer offers the plan in all geographic regions, 

and in all States that have adopted adjusted community 

rating before the date of enactment of this Act. 

‘‘(2) STATES MAY OFFER ADDITIONAL BENEFITS.—Nothing in 

paragraph (1)(A) shall preclude a State from requiring that 

benefits in addition to the essential health benefits required 

under such paragraph be provided to enrollees of a multiState qualified health plan offered in such State. 

‘‘(3) CREDITS.— 

‘‘(A) IN GENERAL.—An individual enrolled in a multiState qualified health plan under this section shall be 

eligible for credits under section 36B of the Internal Revenue Code of 1986 and cost sharing assistance under section 1402 in the same manner as an individual who is 

enrolled in a qualified health plan. 

‘‘(B) NO ADDITIONAL FEDERAL COST.—A requirement 

by a State under paragraph (2) that benefits in addition 

to the essential health benefits required under paragraph 

(1)(A) be provided to enrollees of a multi-State qualified 

health plan shall not affect the amount of a premium 

tax credit provided under section 36B of the Internal Revenue Code of 1986 with respect to such plan. 

‘‘(4) STATE MUST ASSUME COST.—A State shall make payments— 

‘‘(A) to an individual enrolled in a multi-State qualified 

health plan offered in such State; or 

‘‘(B) on behalf of an individual described in subparagraph (A) directly to the multi-State qualified health plan 

in which such individual is enrolled; 

to defray the cost of any additional benefits described in paragraph (2). 

‘‘(5) APPLICATION OF CERTAIN STATE RATING REQUIREMENTS.—With respect to a multi-State qualified health plan 

that is offered in a State with age rating requirements that 
H. R. 3590—787 

are lower than 3:1, the State may require that Exchanges 

operating in such State only permit the offering of such multiState qualified health plans if such plans comply with the 

State’s more protective age rating requirements. 

‘‘(d) PLANS DEEMED TO BE CERTIFIED.—A multi-State qualified 

health plan that is offered under a contract under subsection (a) 

shall be deemed to be certified by an Exchange for purposes of 

section 1311(d)(4)(A). 

‘‘(e) PHASE-IN.—Notwithstanding paragraphs (1) and (2) of subsection (b), the Director shall enter into a contract with a health 

insurance issuer for the offering of a multi-State qualified health 

plan under subsection (a) if— 

‘‘(1) with respect to the first year for which the issuer 

offers such plan, such issuer offers the plan in at least 60 

percent of the States; 

‘‘(2) with respect to the second such year, such issuer 

offers the plan in at least 70 percent of the States; 

‘‘(3) with respect to the third such year, such issuer offers 

the plan in at least 85 percent of the States; and 

‘‘(4) with respect to each subsequent year, such issuer 

offers the plan in all States. 

‘‘(f) APPLICABILITY.—The requirements under chapter 89 of title 

5, United States Code, applicable to health benefits plans under 

such chapter shall apply to multi-State qualified health plans provided for under this section to the extent that such requirements 

do not conflict with a provision of this title. 

‘‘(g) CONTINUED SUPPORT FOR FEHBP.— 

‘‘(1) MAINTENANCE OF EFFORT.—Nothing in this section 

shall be construed to permit the Director to allocate fewer 

financial or personnel resources to the functions of the Office 

of Personnel Management related to the administration of the 

Federal Employees Health Benefit Program under chapter 89 

of title 5, United States Code. 

‘‘(2) SEPARATE RISK POOL.—Enrollees in multi-State qualified health plans under this section shall be treated as a 

separate risk pool apart from enrollees in the Federal 

Employees Health Benefit Program under chapter 89 of title 

5, United States Code. 

‘‘(3) AUTHORITY TO ESTABLISH SEPARATE ENTITIES.—The 

Director may establish such separate units or offices within 

the Office of Personnel Management as the Director determines 

to be appropriate to ensure that the administration of multiState qualified health plans under this section does not interfere with the effective administration of the Federal Employees 

Health Benefit Program under chapter 89 of title 5, United 

States Code. 

‘‘(4) EFFECTIVE OVERSIGHT.—The Director may appoint such 

additional personnel as may be necessary to enable the Director 

to carry out activities under this section. 

‘‘(5) ASSURANCE OF SEPARATE PROGRAM.—In carrying out 

this section, the Director shall ensure that the program under 

this section is separate from the Federal Employees Health 

Benefit Program under chapter 89 of title 5, United States 

Code. Premiums paid for coverage under a multi-State qualified 

health plan under this section shall not be considered to be 

Federal funds for any purposes. 
H. R. 3590—788 

‘‘(6) FEHBP PLANS NOT REQUIRED TO PARTICIPATE.— 

Nothing in this section shall require that a carrier offering 

coverage under the Federal Employees Health Benefit Program 

under chapter 89 of title 5, United States Code, also offer 

a multi-State qualified health plan under this section. 

‘‘(h) ADVISORY BOARD.—The Director shall establish an advisory 

board to provide recommendations on the activities described in 

this section. A significant percentage of the members of such board 

shall be comprised of enrollees in a multi-State qualified health 

plan, or representatives of such enrollees. 

‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 

to be appropriated, such sums as may be necessary to carry out 

this section.’’. 

(r) Section 1341 of this Act is amended— 

(1) in the section heading, by striking ‘‘AND SMALL GROUP

MARKETS’’ and inserting ‘‘MARKET’’; 

(2) in subsection (b)(2)(B), by striking ‘‘paragraph (1)(A)’’ 

and inserting ‘‘paragraph (1)(B)’’; and 

(3) in subsection (c)(1)(A), by striking ‘‘and small group 

markets’’ and inserting ‘‘market’’. 

SEC. 10105. AMENDMENTS TO SUBTITLE E. 

(a) Section 36B(b)(3)(A)(ii) of the Internal Revenue Code of 

1986, as added by section 1401(a) of this Act, is amended by 

striking ‘‘is in excess of’’ and inserting ‘‘equals or exceeds’’. 

(b) Section 36B(c)(1)(A) of the Internal Revenue Code of 1986, 

as added by section 1401(a) of this Act, is amended by inserting 

‘‘equals or’’ before ‘‘exceeds’’. 

(c) Section 36B(c)(2)(C)(iv) of the Internal Revenue Code of 

1986, as added by section 1401(a) of this Act, is amended by 

striking ‘‘subsection (b)(3)(A)(ii)’’ and inserting ‘‘subsection 

(b)(3)(A)(iii)’’. 

(d) Section 1401(d) of this Act is amended by adding at the 

end the following: 

‘‘(3) Section 6211(b)(4)(A) of the Internal Revenue Code 

of 1986 is amended by inserting ‘36B,’ after ‘36A,’.’’. 

(e)(1) Subparagraph (B) of section 45R(d)(3) of the Internal 

Revenue Code of 1986, as added by section 1421(a) of this Act, 

is amended to read as follows: 

‘‘(B) DOLLAR AMOUNT.—For purposes of paragraph 

(1)(B) and subsection (c)(2)— 

‘‘(i) 2010, 2011, 2012, AND 2013.—The dollar amount 

in effect under this paragraph for taxable years beginning in 2010, 2011, 2012, or 2013 is $25,000. 

‘‘(ii) SUBSEQUENT YEARS.—In the case of a taxable 

year beginning in a calendar year after 2013, the dollar 

amount in effect under this paragraph shall be equal 

to $25,000, multiplied by the cost-of-living adjustment 

under section 1(f)(3) for the calendar year, determined 

by substituting ‘calendar year 2012’ for ‘calendar year 

1992’ in subparagraph (B) thereof.’’. 

(2) Subsection (g) of section 45R of the Internal Revenue Code 

of 1986, as added by section 1421(a) of this Act, is amended by 

striking ‘‘2011’’ both places it appears and inserting ‘‘2010, 2011’’. 

(3) Section 280C(h) of the Internal Revenue Code of 1986, 

as added by section 1421(d)(1) of this Act, is amended by striking 

‘‘2011’’ and inserting ‘‘2010, 2011’’. 
H. R. 3590—789 

(4) Section 1421(f) of this Act is amended by striking ‘‘2010’’ 

both places it appears and inserting ‘‘2009’’. 

(5) The amendments made by this subsection shall take effect 

as if included in the enactment of section 1421 of this Act. 

(f) Part I of subtitle E of title I of this Act is amended by 

adding at the end of subpart B, the following: 

‘‘SEC. 1416. STUDY OF GEOGRAPHIC VARIATION IN APPLICATION OF 

FPL. 

‘‘(a) IN GENERAL.—The Secretary shall conduct a study to 

examine the feasibility and implication of adjusting the application 

of the Federal poverty level under this subtitle (and the amendments made by this subtitle) for different geographic areas so 

as to reflect the variations in cost-of-living among different areas 

within the United States. If the Secretary determines that an 

adjustment is feasible, the study should include a methodology 

to make such an adjustment. Not later than January 1, 2013, 

the Secretary shall submit to Congress a report on such study 

and shall include such recommendations as the Secretary determines appropriate. 

‘‘(b) INCLUSION OF TERRITORIES.— 

‘‘(1) IN GENERAL.—The Secretary shall ensure that the 

study under subsection (a) covers the territories of the United 

States and that special attention is paid to the disparity that 

exists among poverty levels and the cost of living in such 

territories and to the impact of such disparity on efforts to 

expand health coverage and ensure health care. 

‘‘(2) TERRITORIES DEFINED.—In this subsection, the term 

‘territories of the United States’ includes the Commonwealth 

of Puerto Rico, the United States Virgin Islands, Guam, the 

Northern Mariana Islands, and any other territory or possession 

of the United States.’’. 

SEC. 10106. AMENDMENTS TO SUBTITLE F. 

(a) Section 1501(a)(2) of this Act is amended to read as follows: 

‘‘(2) EFFECTS ON THE NATIONAL ECONOMY AND INTERSTATE

COMMERCE.—The effects described in this paragraph are the 

following: 

‘‘(A) The requirement regulates activity that is commercial and economic in nature: economic and financial 

decisions about how and when health care is paid for, 

and when health insurance is purchased. In the absence 

of the requirement, some individuals would make an economic and financial decision to forego health insurance 

coverage and attempt to self-insure, which increases financial risks to households and medical providers. 

‘‘(B) Health insurance and health care services are 

a significant part of the national economy. National health 

spending is projected to increase from $2,500,000,000,000, 

or 17.6 percent of the economy, in 2009 to 

$4,700,000,000,000 in 2019. Private health insurance 

spending is projected to be $854,000,000,000 in 2009, and 

pays for medical supplies, drugs, and equipment that are 

shipped in interstate commerce. Since most health insurance is sold by national or regional health insurance companies, health insurance is sold in interstate commerce and 

claims payments flow through interstate commerce. 
H. R. 3590—790 

‘‘(C) The requirement, together with the other provisions of this Act, will add millions of new consumers to 

the health insurance market, increasing the supply of, and 

demand for, health care services, and will increase the 

number and share of Americans who are insured. 

‘‘(D) The requirement achieves near-universal coverage 

by building upon and strengthening the private employerbased health insurance system, which covers 176,000,000 

Americans nationwide. In Massachusetts, a similar requirement has strengthened private employer-based coverage: 

despite the economic downturn, the number of workers 

offered employer-based coverage has actually increased. 

‘‘(E) The economy loses up to $207,000,000,000 a year 

because of the poorer health and shorter lifespan of the 

uninsured. By significantly reducing the number of the 

uninsured, the requirement, together with the other provisions of this Act, will significantly reduce this economic 

cost. 

‘‘(F) The cost of providing uncompensated care to the 

uninsured was $43,000,000,000 in 2008. To pay for this 

cost, health care providers pass on the cost to private 

insurers, which pass on the cost to families. This costshifting increases family premiums by on average over 

$1,000 a year. By significantly reducing the number of 

the uninsured, the requirement, together with the other 

provisions of this Act, will lower health insurance premiums. 

‘‘(G) 62 percent of all personal bankruptcies are caused 

in part by medical expenses. By significantly increasing 

health insurance coverage, the requirement, together with 

the other provisions of this Act, will improve financial 

security for families. 

‘‘(H) Under the Employee Retirement Income Security 

Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health 

Service Act (42 U.S.C. 201 et seq.), and this Act, the Federal 

Government has a significant role in regulating health 

insurance. The requirement is an essential part of this 

larger regulation of economic activity, and the absence 

of the requirement would undercut Federal regulation of 

the health insurance market. 

‘‘(I) Under sections 2704 and 2705 of the Public Health 

Service Act (as added by section 1201 of this Act), if there 

were no requirement, many individuals would wait to purchase health insurance until they needed care. By significantly increasing health insurance coverage, the requirement, together with the other provisions of this Act, will 

minimize this adverse selection and broaden the health 

insurance risk pool to include healthy individuals, which 

will lower health insurance premiums. The requirement 

is essential to creating effective health insurance markets 

in which improved health insurance products that are 

guaranteed issue and do not exclude coverage of preexisting conditions can be sold. 

‘‘(J) Administrative costs for private health insurance, 

which were $90,000,000,000 in 2006, are 26 to 30 percent 

of premiums in the current individual and small group 
H. R. 3590—791 

markets. By significantly increasing health insurance coverage and the size of purchasing pools, which will increase 

economies of scale, the requirement, together with the other 

provisions of this Act, will significantly reduce administrative costs and lower health insurance premiums. The 

requirement is essential to creating effective health insurance markets that do not require underwriting and eliminate its associated administrative costs.’’. 

(b)(1) Section 5000A(b)(1) of the Internal Revenue Code of 1986, 

as added by section 1501(b) of this Act, is amended to read as 

follows: 

‘‘(1) IN GENERAL.—If a taxpayer who is an applicable individual, or an applicable individual for whom the taxpayer is 

liable under paragraph (3), fails to meet the requirement of 

subsection (a) for 1 or more months, then, except as provided 

in subsection (e), there is hereby imposed on the taxpayer 

a penalty with respect to such failures in the amount determined under subsection (c).’’. 

(2) Paragraphs (1) and (2) of section 5000A(c) of the 

Internal Revenue Code of 1986, as so added, are amended 

to read as follows: 

‘‘(1) IN GENERAL.—The amount of the penalty imposed by 

this section on any taxpayer for any taxable year with respect 

to failures described in subsection (b)(1) shall be equal to the 

lesser of— 

‘‘(A) the sum of the monthly penalty amounts determined under paragraph (2) for months in the taxable year 

during which 1 or more such failures occurred, or 

‘‘(B) an amount equal to the national average premium 

for qualified health plans which have a bronze level of 

coverage, provide coverage for the applicable family size 

involved, and are offered through Exchanges for plan years 

beginning in the calendar year with or within which the 

taxable year ends. 

‘‘(2) MONTHLY PENALTY AMOUNTS.—For purposes of paragraph (1)(A), the monthly penalty amount with respect to any 

taxpayer for any month during which any failure described 

in subsection (b)(1) occurred is an amount equal to 1⁄12 of 

the greater of the following amounts: 

‘‘(A) FLAT DOLLAR AMOUNT.—An amount equal to the 

lesser of— 

‘‘(i) the sum of the applicable dollar amounts for 

all individuals with respect to whom such failure 

occurred during such month, or 

‘‘(ii) 300 percent of the applicable dollar amount 

(determined without regard to paragraph (3)(C)) for 

the calendar year with or within which the taxable 

year ends. 

‘‘(B) PERCENTAGE OF INCOME.—An amount equal to 

the following percentage of the taxpayer’s household income 

for the taxable year: 

‘‘(i) 0.5 percent for taxable years beginning in 2014. 

‘‘(ii) 1.0 percent for taxable years beginning in 

2015. 

‘‘(iii) 2.0 percent for taxable years beginning after 

2015.’’. 
H. R. 3590—792 

(3) Section 5000A(c)(3) of the Internal Revenue Code of 1986, 

as added by section 1501(b) of this Act, is amended by striking 

‘‘$350’’ and inserting ‘‘$495’’. 

(c) Section 5000A(d)(2)(A) of the Internal Revenue Code of 

1986, as added by section 1501(b) of this Act, is amended to read 

as follows: 

‘‘(A) RELIGIOUS CONSCIENCE EXEMPTION.—Such term 

shall not include any individual for any month if such 

individual has in effect an exemption under section 

1311(d)(4)(H) of the Patient Protection and Affordable Care 

Act which certifies that such individual is— 

‘‘(i) a member of a recognized religious sect or 

division thereof which is described in section 

1402(g)(1), and 

‘‘(ii) an adherent of established tenets or teachings 

of such sect or division as described in such section.’’. 

(d) Section 5000A(e)(1)(C) of the Internal Revenue Code of 

1986, as added by section 1501(b) of this Act, is amended to read 

as follows: 

‘‘(C) SPECIAL RULES FOR INDIVIDUALS RELATED TO

EMPLOYEES.—For purposes of subparagraph (B)(i), if an 

applicable individual is eligible for minimum essential coverage through an employer by reason of a relationship 

to an employee, the determination under subparagraph 

(A) shall be made by reference to required contribution 

of the employee.’’. 

(e) Section 4980H(b) of the Internal Revenue Code of 1986, 

as added by section 1513(a) of this Act, is amended to read as 

follows: 

‘‘(b) LARGE EMPLOYERS WITH WAITING PERIODS EXCEEDING 60 

DAYS.— ‘‘(1) IN GENERAL.—In the case of any applicable large 

employer which requires an extended waiting period to enroll 

in any minimum essential coverage under an employer-sponsored plan (as defined in section 5000A(f)(2)), there is hereby 

imposed on the employer an assessable payment of $600 for 

each full-time employee of the employer to whom the extended 

waiting period applies. 

‘‘(2) EXTENDED WAITING PERIOD.—The term ‘extended 

waiting period’ means any waiting period (as defined in section 

2701(b)(4) of the Public Health Service Act) which exceeds 

60 days.’’. 

(f)(1) Subparagraph (A) of section 4980H(d)(4) of the Internal 

Revenue Code of 1986, as added by section 1513(a) of this Act, 

is amended by inserting ‘‘, with respect to any month,’’ after 

‘‘means’’. 

(2) Section 4980H(d)(2) of the Internal Revenue Code of 1986, 

as added by section 1513(a) of this Act, is amended by adding 

at the end the following: 

‘‘(D) APPLICATION TO CONSTRUCTION INDUSTRY

EMPLOYERS.—In the case of any employer the substantial 

annual gross receipts of which are attributable to the 

construction industry— 

‘‘(i) subparagraph (A) shall be applied by substituting ‘who employed an average of at least 5 fulltime employees on business days during the preceding 

calendar year and whose annual payroll expenses 
H. R. 3590—793 

exceed $250,000 for such preceding calendar year’ for 

‘who employed an average of at least 50 full-time 

employees on business days during the preceding calendar year’, and 

‘‘(ii) subparagraph (B) shall be applied by substituting ‘5’ for ‘50’.’’. 

(3) The amendment made by paragraph (2) shall apply to 

months beginning after December 31, 2013. 

(g) Section 6056(b) of the Internal Revenue Code of 1986, as 

added by section 1514(a) of the Act, is amended by adding at 

the end the following new flush sentence: 

‘‘The Secretary shall have the authority to review the accuracy 

of the information provided under this subsection, including the 

applicable large employer’s share under paragraph (2)(C)(iv).’’. 

SEC. 10107. AMENDMENTS TO SUBTITLE G. 

(a) Section 1562 of this Act is amended, in the amendment 

made by subsection (a)(2)(B)(iii), by striking ‘‘subpart 1’’ and 

inserting ‘‘subparts I and II’’; and 

(b) Subtitle G of title I of this Act is amended— 

(1) by redesignating section 1562 (as amended) as section 

1563; and 

(2) by inserting after section 1561 the following: 

‘‘SEC. 1562. GAO STUDY REGARDING THE RATE OF DENIAL OF COVERAGE AND ENROLLMENT BY HEALTH INSURANCE 

ISSUERS AND GROUP HEALTH PLANS. 

‘‘(a) IN GENERAL.—The Comptroller General of the United 

States (referred to in this section as the ‘Comptroller General’) 

shall conduct a study of the incidence of denials of coverage for 

medical services and denials of applications to enroll in health 

insurance plans, as described in subsection (b), by group health 

plans and health insurance issuers. 

‘‘(b) DATA.— ‘‘(1) IN GENERAL.—In conducting the study described in 

subsection (a), the Comptroller General shall consider samples 

of data concerning the following: 

‘‘(A)(i) denials of coverage for medical services to a 

plan enrollees, by the types of services for which such 

coverage was denied; and 

‘‘(ii) the reasons such coverage was denied; and 

‘‘(B)(i) incidents in which group health plans and health 

insurance issuers deny the application of an individual 

to enroll in a health insurance plan offered by such group 

health plan or issuer; and 

‘‘(ii) the reasons such applications are denied. 

‘‘(2) SCOPE OF DATA.— ‘‘(A) FAVORABLY RESOLVED DISPUTES.—The data that 

the Comptroller General considers under paragraph (1) 

shall include data concerning denials of coverage for medical services and denials of applications for enrollment in 

a plan by a group health plan or health insurance issuer, 

where such group health plan or health insurance issuer 

later approves such coverage or application. 

‘‘(B) ALL HEALTH PLANS.—The study under this section 

shall consider data from varied group health plans and 

health insurance plans offered by health insurance issuers, 
H. R. 3590—794 

including qualified health plans and health plans that are 

not qualified health plans. 

‘‘(c) REPORT.—Not later than one year after the date of enactment of this Act, the Comptroller General shall submit to the 

Secretaries of Health and Human Services and Labor a report 

describing the results of the study conducted under this section. 

‘‘(d) PUBLICATION OF REPORT.—The Secretaries of Health and 

Human Services and Labor shall make the report described in 

subsection (c) available to the public on an Internet website. 

‘‘SEC. 1563. SMALL BUSINESS PROCUREMENT. 

‘‘Part 19 of the Federal Acquisition Regulation, section 15 of 

the Small Business Act (15 U.S.C. 644), and any other applicable 

laws or regulations establishing procurement requirements relating 

to small business concerns (as defined in section 3 of the Small 

Business Act (15 U.S.C. 632)) may not be waived with respect 

to any contract awarded under any program or other authority 

under this Act or an amendment made by this Act.’’. 

SEC. 10108. FREE CHOICE VOUCHERS. 

(a) IN GENERAL.—An offering employer shall provide free choice 

vouchers to each qualified employee of such employer. 

(b) OFFERING EMPLOYER.—For purposes of this section, the 

term ‘‘offering employer’’ means any employer who— 

(1) offers minimum essential coverage to its employees 

consisting of coverage through an eligible employer-sponsored 

plan; and 

(2) pays any portion of the costs of such plan. 

(c) QUALIFIED EMPLOYEE.—For purposes of this section— 

(1) IN GENERAL.—The term ‘‘qualified employee’’ means, 

with respect to any plan year of an offering employer, any 

employee— 

(A) whose required contribution (as determined under 

section 5000A(e)(1)(B)) for minimum essential coverage 

through an eligible employer-sponsored plan— 

(i) exceeds 8 percent of such employee’s household 

income for the taxable year described in section 

1412(b)(1)(B) which ends with or within in the plan 

year; and 

(ii) does not exceed 9.8 percent of such employee’s 

household income for such taxable year; 

(B) whose household income for such taxable year is 

not greater than 400 percent of the poverty line for a 

family of the size involved; and 

(C) who does not participate in a health plan offered 

by the offering employer. 

(2) INDEXING.—In the case of any calendar year beginning 

after 2014, the Secretary shall adjust the 8 percent under 

paragraph (1)(A)(i) and 9.8 percent under paragraph (1)(A)(ii) 

for the calendar year to reflect the rate of premium growth 

between the preceding calendar year and 2013 over the rate 

of income growth for such period. 

(d) FREE CHOICE VOUCHER.— 

(1) AMOUNT.— 

(A) IN GENERAL.—The amount of any free choice 

voucher provided under subsection (a) shall be equal to 

the monthly portion of the cost of the eligible employersponsored plan which would have been paid by the 
H. R. 3590—795 

employer if the employee were covered under the plan 

with respect to which the employer pays the largest portion 

of the cost of the plan. Such amount shall be equal to 

the amount the employer would pay for an employee with 

self-only coverage unless such employee elects family coverage (in which case such amount shall be the amount 

the employer would pay for family coverage). 

(B) DETERMINATION OF COST.—The cost of any health 

plan shall be determined under the rules similar to the 

rules of section 2204 of the Public Health Service Act, 

except that such amount shall be adjusted for age and 

category of enrollment in accordance with regulations 

established by the Secretary. 

(2) USE OF VOUCHERS.—An Exchange shall credit the 

amount of any free choice voucher provided under subsection 

(a) to the monthly premium of any qualified health plan in 

the Exchange in which the qualified employee is enrolled and 

the offering employer shall pay any amounts so credited to 

the Exchange. 

(3) PAYMENT OF EXCESS AMOUNTS.—If the amount of the 

free choice voucher exceeds the amount of the premium of 

the qualified health plan in which the qualified employee is 

enrolled for such month, such excess shall be paid to the 

employee. 

(e) OTHER DEFINITIONS.—Any term used in this section which 

is also used in section 5000A of the Internal Revenue Code of 

1986 shall have the meaning given such term under such section 

5000A. 

(f) EXCLUSION FROM INCOME FOR EMPLOYEE.— 

(1) IN GENERAL.—Part III of subchapter B of chapter 1 

of the Internal Revenue Code of 1986 is amended by inserting 

after section 139C the following new section: 

‘‘SEC. 139D. FREE CHOICE VOUCHERS. 

‘‘Gross income shall not include the amount of any free choice 

voucher provided by an employer under section 10108 of the Patient 

Protection and Affordable Care Act to the extent that the amount 

of such voucher does not exceed the amount paid for a qualified 

health plan (as defined in section 1301 of such Act) by the taxpayer.’’. 

(2) CLERICAL AMENDMENT.—The table of sections for part 

III of subchapter B of chapter 1 of such Code is amended 

by inserting after the item relating to section 139C the following 

new item: 

‘‘Sec. 139D. Free choice vouchers.’’. 

(3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to vouchers provided after December 31, 

2013. 

(g) DEDUCTION ALLOWED TO EMPLOYER.— 

(1) IN GENERAL.—Section 162(a) of the Internal Revenue 

Code of 1986 is amended by adding at the end the following 

new sentence: ‘‘For purposes of paragraph (1), the amount 

of a free choice voucher provided under section 10108 of the 

Patient Protection and Affordable Care Act shall be treated 

as an amount for compensation for personal services actually 

rendered.’’. 
H. R. 3590—796 

(2) EFFECTIVE DATE.—The amendments made by this subsection shall apply to vouchers provided after December 31, 

2013. 

(h) VOUCHER TAKEN INTO ACCOUNT IN DETERMINING PREMIUM

CREDIT.— 

(1) IN GENERAL.—Subsection (c)(2) of section 36B of the 

Internal Revenue Code of 1986, as added by section 1401, 

is amended by adding at the end the following new subparagraph: 

‘‘(D) EXCEPTION FOR INDIVIDUAL RECEIVING FREE

CHOICE VOUCHERS.—The term ‘coverage month’ shall not 

include any month in which such individual has a free 

choice voucher provided under section 10108 of the Patient 

Protection and Affordable Care Act.’’. 

(2) EFFECTIVE DATE.—The amendment made by this subsection shall apply to taxable years beginning after December 

31, 2013. 

(i) COORDINATION WITH EMPLOYER RESPONSIBILITIES.— 

(1) SHARED RESPONSIBILITY PENALTY.— 

(A) IN GENERAL.—Subsection (c) of section 4980H of 

the Internal Revenue Code of 1986, as added by section 

1513, is amended by adding at the end the following new 

paragraph: 

‘‘(3) SPECIAL RULES FOR EMPLOYERS PROVIDING FREE CHOICE

VOUCHERS.—No assessable payment shall be imposed under 

paragraph (1) for any month with respect to any employee 

to whom the employer provides a free choice voucher under 

section 10108 of the Patient Protection and Affordable Care 

Act for such month.’’. 

(B) EFFECTIVE DATE.—The amendment made by this 

paragraph shall apply to months beginning after December 

31, 2013. 

(2) NOTIFICATION REQUIREMENT.—Section 18B(a)(3) of the 

Fair Labor Standards Act of 1938, as added by section 1512, 

is amended— 

(A) by inserting ‘‘and the employer does not offer a 

free choice voucher’’ after ‘‘Exchange’’; and 

(B) by striking ‘‘will lose’’ and inserting ‘‘may lose’’. 

(j) EMPLOYER REPORTING.— 

(1) IN GENERAL.—Subsection (a) of section 6056 of the 

Internal Revenue Code of 1986, as added by section 1514, 

is amended by inserting ‘‘and every offering employer’’ before 

‘‘shall’’. 

(2) OFFERING EMPLOYERS.—Subsection (f) of section 6056 

of such Code, as added by section 1514, is amended to read 

as follows: 

‘‘(f) DEFINITIONS.—For purposes of this section— 

‘‘(1) OFFERING EMPLOYER.— ‘‘(A) IN GENERAL.—The term ‘offering employer’ means 

any offering employer (as defined in section 10108(b) of 

the Patient Protection and Affordable Care Act) if the 

required contribution (within the meaning of section 

5000A(e)(1)(B)(i)) of any employee exceeds 8 percent of 

the wages (as defined in section 3121(a)) paid to such 

employee by such employer. 

‘‘(B) INDEXING.—In the case of any calendar year beginning after 2014, the 8 percent under subparagraph (A) 
H. R. 3590—797 

shall be adjusted for the calendar year to reflect the rate 

of premium growth between the preceding calendar year 

and 2013 over the rate of income growth for such period. 

‘‘(2) OTHER DEFINITIONS.—Any term used in this section 

which is also used in section 4980H shall have the meaning 

given such term by section 4980H.’’. 

(3) CONFORMING AMENDMENTS.— 

(A) The heading of section 6056 of such Code, as added 

by section 1514, is amended by striking ‘‘LARGE’’ and 

inserting ‘‘CERTAIN’’. 

(B) Section 6056(b)(2)(C) of such Code is amended— 

(i) by inserting ‘‘in the case of an applicable large 

employer,’’ before ‘‘the length’’ in clause (i); 

(ii) by striking ‘‘and’’ at the end of clause (iii); 

(iii) by striking ‘‘applicable large employer’’ in 

clause (iv) and inserting ‘‘employer’’; 

(iv) by inserting ‘‘and’’ at the end of clause (iv); 

and 

(v) by inserting at the end the following new 

clause: 

‘‘(v) in the case of an offering employer, the option 

for which the employer pays the largest portion of 

the cost of the plan and the portion of the cost paid 

by the employer in each of the enrollment categories 

under such option,’’. 

(C) Section 6056(d)(2) of such Code is amended by 

inserting ‘‘or offering employer’’ after ‘‘applicable large 

employer’’. 

(D) Section 6056(e) of such Code is amended by 

inserting ‘‘or offering employer’’ after ‘‘applicable large 

employer’’. 

(E) Section 6724(d)(1)(B)(xxv) of such Code, as added 

by section 1514, is amended by striking ‘‘large’’ and 

inserting ‘‘certain’’. 

(F) Section 6724(d)(2)(HH) of such Code, as added by 

section 1514, is amended by striking ‘‘large’’ and inserting 

‘‘certain’’. 

(G) The table of sections for subpart D of part III 

of subchapter A of chapter 1 of such Code, as amended 

by section 1514, is amended by striking ‘‘Large employers’’ 

in the item relating to section 6056 and inserting ‘‘Certain 

employers’’. 

(4) EFFECTIVE DATE.—The amendments made by this subsection shall apply to periods beginning after December 31, 

2013. 

SEC. 10109. DEVELOPMENT OF STANDARDS FOR FINANCIAL AND 

ADMINISTRATIVE TRANSACTIONS. 

(a) ADDITIONAL TRANSACTION STANDARDS AND OPERATING

RULES.— 

(1) DEVELOPMENT OF ADDITIONAL TRANSACTION STANDARDS

AND OPERATING RULES.—Section 1173(a) of the Social Security 

Act (42 U.S.C. 1320d–2(a)), as amended by section 1104(b)(2), 

is amended— 

(A) in paragraph (1)(B), by inserting before the period 

the following: ‘‘, and subject to the requirements under 

paragraph (5)’’; and 
H. R. 3590—798 

(B) by adding at the end the following new paragraph: 

‘‘(5) CONSIDERATION OF STANDARDIZATION OF ACTIVITIES

AND ITEMS.— 

‘‘(A) IN GENERAL.—For purposes of carrying out paragraph (1)(B), the Secretary shall solicit, not later than 

January 1, 2012, and not less than every 3 years thereafter, 

input from entities described in subparagraph (B) on— 

‘‘(i) whether there could be greater uniformity in 

financial and administrative activities and items, as 

determined appropriate by the Secretary; and 

‘‘(ii) whether such activities should be considered 

financial and administrative transactions (as described 

in paragraph (1)(B)) for which the adoption of standards and operating rules would improve the operation 

of the health care system and reduce administrative 

costs. 

‘‘(B) SOLICITATION OF INPUT.—For purposes of subparagraph (A), the Secretary shall seek input from— 

‘‘(i) the National Committee on Vital and Health 

Statistics, the Health Information Technology Policy 

Committee, and the Health Information Technology 

Standards Committee; and 

‘‘(ii) standard setting organizations and stakeholders, as determined appropriate by the Secretary.’’. 

(b) ACTIVITIES AND ITEMS FOR INITIAL CONSIDERATION.—For 

purposes of section 1173(a)(5) of the Social Security Act, as added 

by subsection (a), the Secretary of Health and Human Services 

(in this section referred to as the ‘‘Secretary’’) shall, not later 

than January 1, 2012, seek input on activities and items relating 

to the following areas: 

(1) Whether the application process, including the use of 

a uniform application form, for enrollment of health care providers by health plans could be made electronic and standardized. 

(2) Whether standards and operating rules described in 

section 1173 of the Social Security Act should apply to the 

health care transactions of automobile insurance, worker’s compensation, and other programs or persons not described in 

section 1172(a) of such Act (42 U.S.C. 1320d–1(a)). 

(3) Whether standardized forms could apply to financial 

audits required by health plans, Federal and State agencies 

(including State auditors, the Office of the Inspector General 

of the Department of Health and Human Services, and the 

Centers for Medicare & Medicaid Services), and other relevant 

entities as determined appropriate by the Secretary. 

(4) Whether there could be greater transparency and 

consistency of methodologies and processes used to establish 

claim edits used by health plans (as described in section 1171(5) 

of the Social Security Act (42 U.S.C. 1320d(5))). 

(5) Whether health plans should be required to publish 

their timeliness of payment rules. 

(c) ICD CODING CROSSWALKS.— (1) ICD–9 TO ICD–10 CROSSWALK.—The Secretary shall task 

the ICD–9–CM Coordination and Maintenance Committee to 

convene a meeting, not later than January 1, 2011, to receive 

input from appropriate stakeholders (including health plans, 

health care providers, and clinicians) regarding the crosswalk 
H. R. 3590—799 

between the Ninth and Tenth Revisions of the International 

Classification of Diseases (ICD–9 and ICD–10, respectively) 

that is posted on the website of the Centers for Medicare 

& Medicaid Services, and make recommendations about appropriate revisions to such crosswalk. 

(2) REVISION OF CROSSWALK.—For purposes of the crosswalk described in paragraph (1), the Secretary shall make 

appropriate revisions and post any such revised crosswalk on 

the website of the Centers for Medicare & Medicaid Services. 

(3) USE OF REVISED CROSSWALK.—For purposes of paragraph (2), any revised crosswalk shall be treated as a code 

set for which a standard has been adopted by the Secretary 

for purposes of section 1173(c)(1)(B) of the Social Security Act 

(42 U.S.C. 1320d–2(c)(1)(B)). 

(4) SUBSEQUENT CROSSWALKS.—For subsequent revisions 

of the International Classification of Diseases that are adopted 

by the Secretary as a standard code set under section 1173(c) 

of the Social Security Act (42 U.S.C. 1320d–2(c)), the Secretary 

shall, after consultation with the appropriate stakeholders, post 

on the website of the Centers for Medicare & Medicaid Services 

a crosswalk between the previous and subsequent version of 

the International Classification of Diseases not later than the 

date of implementation of such subsequent revision. 

Subtitle B—Provisions Relating to Title II 

PART I—MEDICAID AND CHIP 

SEC. 10201. AMENDMENTS TO THE SOCIAL SECURITY ACT AND TITLE 

II OF THIS ACT. 

(a)(1) Section 1902(a)(10)(A)(i)(IX) of the Social Security Act 

(42 U.S.C. 1396a(a)(10)(A)(i)(IX)), as added by section 2004(a), is 

amended to read as follows: 

‘‘(IX) who— 

‘‘(aa) are under 26 years of age; 

‘‘(bb) are not described in or enrolled 

under any of subclauses (I) through (VII) of 

this clause or are described in any of such 

subclauses but have income that exceeds the 

level of income applicable under the State plan 

for eligibility to enroll for medical assistance 

under such subclause; 

‘‘(cc) were in foster care under the responsibility of the State on the date of attaining 

18 years of age or such higher age as the 

State has elected under section 475(8)(B)(iii); 

and 

‘‘(dd) were enrolled in the State plan 

under this title or under a waiver of the plan 

while in such foster care;’’. 

(2) Section 1902(a)(10) of the Social Security Act (42 U.S.C. 

1396a(a)(10), as amended by section 2001(a)(5)(A), is amended in 

the matter following subparagraph (G), by striking ‘‘and (XV)’’ and 

inserting ‘‘(XV)’’, and by inserting ‘‘and (XVI) if an individual is 

described in subclause (IX) of subparagraph (A)(i) and is also 

described in subclause (VIII) of that subparagraph, the medical 
H. R. 3590—800 

assistance shall be made available to the individual through subclause (IX) instead of through subclause (VIII)’’ before the semicolon. 

(3) Section 2004(d) of this Act is amended by striking ‘‘2019’’ 

and inserting ‘‘2014’’. 

(b) Section 1902(k)(2) of the Social Security Act (42 U.S.C. 

1396a(k)(2)), as added by section 2001(a)(4)(A), is amended by 

striking ‘‘January 1, 2011’’ and inserting ‘‘April 1, 2010’’. 

(c) Section 1905 of the Social Security Act (42 U.S.C. 1396d), 

as amended by sections 2001(a)(3), 2001(a)(5)(C), 2006, and 

4107(a)(2), is amended— 

(1) in subsection (a), in the matter preceding paragraph 

(1), by inserting in clause (xiv), ‘‘or 1902(a)(10)(A)(i)(IX)’’ before 

the comma; 

(2) in subsection (b), in the first sentence, by inserting 

‘‘, (z),’’ before ‘‘and (aa)’’; 

(3) in subsection (y)— 

(A) in paragraph (1)(B)(ii)(II), in the first sentence, 

by inserting ‘‘includes inpatient hospital services,’’ after 

‘‘100 percent of the poverty line, that’’; and 

(B) in paragraph (2)(A), by striking ‘‘on the date of 

enactment of the Patient Protection and Affordable Care 

Act’’ and inserting ‘‘as of December 1, 2009’’; 

(4) by inserting after subsection (y) the following: 

‘‘(z) EQUITABLE SUPPORT FOR CERTAIN STATES.— 

‘‘(1)(A) During the period that begins on January 1, 2014, 

and ends on September 30, 2019, notwithstanding subsection 

(b), the Federal medical assistance percentage otherwise determined under subsection (b) with respect to a fiscal year occurring during that period shall be increased by 2.2 percentage 

points for any State described in subparagraph (B) for amounts 

expended for medical assistance for individuals who are not 

newly eligible (as defined in subsection (y)(2)) individuals 

described in subclause (VIII) of section 1902(a)(10)(A)(i). 

‘‘(B) For purposes of subparagraph (A), a State described 

in this subparagraph is a State that— 

‘‘(i) is an expansion State described in subsection 

(y)(1)(B)(ii)(II); 

‘‘(ii) the Secretary determines will not receive any payments under this title on the basis of an increased Federal 

medical assistance percentage under subsection (y) for 

expenditures for medical assistance for newly eligible 

individuals (as so defined); and 

‘‘(iii) has not been approved by the Secretary to divert 

a portion of the DSH allotment for a State to the costs 

of providing medical assistance or other health benefits 

coverage under a waiver that is in effect on July 2009. 

‘‘(2)(A) During the period that begins on January 1, 2014, 

and ends on December 31, 2016, notwithstanding subsection (b), 

the Federal medical assistance percentage otherwise determined 

under subsection (b) with respect to all or any portion of a fiscal 

year occurring during that period shall be increased by .5 percentage 

point for a State described in subparagraph (B) for amounts 

expended for medical assistance under the State plan under this 

title or under a waiver of that plan during that period. 

‘‘(B) For purposes of subparagraph (A), a State described in 

this subparagraph is a State that— 
H. R. 3590—801 

‘‘(i) is described in clauses (i) and (ii) of paragraph (1)(B); 

and 

‘‘(ii) is the State with the highest percentage of its population insured during 2008, based on the Current Population 

Survey. 

‘‘(3) Notwithstanding subsection (b) and paragraphs (1) and 

(2) of this subsection, the Federal medical assistance percentage 

otherwise determined under subsection (b) with respect to all or 

any portion of a fiscal year that begins on or after January 1, 

2017, for the State of Nebraska, with respect to amounts expended 

for newly eligible individuals described in subclause (VIII) of section 

1902(a)(10)(A)(i), shall be determined as provided for under subsection (y)(1)(A) (notwithstanding the period provided for in such 

paragraph). 

‘‘(4) The increase in the Federal medical assistance percentage 

for a State under paragraphs (1), (2), or (3) shall apply only for 

purposes of this title and shall not apply with respect to— 

‘‘(A) disproportionate share hospital payments described 

in section 1923; 

‘‘(B) payments under title IV; 

‘‘(C) payments under title XXI; and 

‘‘(D) payments under this title that are based on the 

enhanced FMAP described in section 2105(b).’’; 

(5) in subsection (aa), is amended by striking ‘‘without 

regard to this subsection and subsection (y)’’ and inserting 

‘‘without regard to this subsection, subsection (y), subsection 

(z), and section 10202 of the Patient Protection and Affordable 

Care Act’’ each place it appears; 

(6) by adding after subsection (bb), the following: 

‘‘(cc) REQUIREMENT FOR CERTAIN STATES.—Notwithstanding 

subsections (y), (z), and (aa), in the case of a State that requires 

political subdivisions within the State to contribute toward the 

non-Federal share of expenditures required under the State plan 

under section 1902(a)(2), the State shall not be eligible for an 

increase in its Federal medical assistance percentage under such 

subsections if it requires that political subdivisions pay a greater 

percentage of the non-Federal share of such expenditures, or a 

greater percentage of the non-Federal share of payments under 

section 1923, than the respective percentages that would have been 

required by the State under the State plan under this title, State 

law, or both, as in effect on December 31, 2009, and without 

regard to any such increase. Voluntary contributions by a political 

subdivision to the non-Federal share of expenditures under the 

State plan under this title or to the non-Federal share of payments 

under section 1923, shall not be considered to be required contributions for purposes of this subsection. The treatment of voluntary 

contributions, and the treatment of contributions required by a 

State under the State plan under this title, or State law, as provided 

by this subsection, shall also apply to the increases in the Federal 

medical assistance percentage under section 5001 of the American 

Recovery and Reinvestment Act of 2009.’’. 

(d) Section 1108(g)(4)(B) of the Social Security Act (42 U.S.C. 

1308(g)(4)(B)), as added by section 2005(b), is amended by striking 

‘‘income eligibility level in effect for that population under title 

XIX or under a waiver’’ and inserting ‘‘the highest income eligibility 

level in effect for parents under the commonwealth’s or territory’s 

State plan under title XIX or under a waiver of the plan’’. 
H. R. 3590—802 

(e)(1) Section 1923(f) of the Social Security Act (42 U.S.C. 

1396r–4(f)), as amended by section 2551, is amended— 

(A) in paragraph (6)— 

(i) by striking the paragraph heading and inserting 

the following: ‘‘ALLOTMENT ADJUSTMENTS’’; and 

(ii) in subparagraph (B), by adding at the end the 

following: 

‘‘(iii) ALLOTMENT FOR 2D, 3RD, AND 4TH QUARTER

OF FISCAL YEAR 2012, FISCAL YEAR 2013, AND SUCCEEDING

FISCAL YEARS.—Notwithstanding the table set forth in 

paragraph (2) or paragraph (7): 

‘‘(I) 2D, 3RD, AND 4TH QUARTER OF FISCAL YEAR

2012.—The DSH allotment for Hawaii for the 2d, 

3rd, and 4th quarters of fiscal year 2012 shall 

be $7,500,000. 

‘‘(II) TREATMENT AS A LOW-DSH STATE FOR

FISCAL YEAR 2013 AND SUCCEEDING FISCAL YEARS.— 

With respect to fiscal year 2013, and each fiscal 

year thereafter, the DSH allotment for Hawaii 

shall be increased in the same manner as allotments for low DSH States are increased for such 

fiscal year under clause (iii) of paragraph (5)(B). 

‘‘(III) CERTAIN HOSPITAL PAYMENTS.—The Secretary may not impose a limitation on the total 

amount of payments made to hospitals under the 

QUEST section 1115 Demonstration Project except 

to the extent that such limitation is necessary 

to ensure that a hospital does not receive payments 

in excess of the amounts described in subsection 

(g), or as necessary to ensure that such payments 

under the waiver and such payments pursuant 

to the allotment provided in this clause do not, 

in the aggregate in any year, exceed the amount 

that the Secretary determines is equal to the Federal medical assistance percentage component 

attributable to disproportionate share hospital payment adjustments for such year that is reflected 

in the budget neutrality provision of the QUEST 

Demonstration Project.’’; and 

(B) in paragraph (7)— 

(i) in subparagraph (A), in the matter preceding clause 

(i), by striking ‘‘subparagraph (E)’’ and inserting ‘‘subparagraphs (E) and (G)’’; 

(ii) in subparagraph (B)— 

(I) in clause (i), by striking subclauses (I) and 

(II), and inserting the following: 

‘‘(I) if the State is a low DSH State described 

in paragraph (5)(B) and has spent not more than 

99.90 percent of the DSH allotments for the State 

on average for the period of fiscal years 2004 

through 2008, as of September 30, 2009, the 

applicable percentage is equal to 25 percent; 

‘‘(II) if the State is a low DSH State described 

in paragraph (5)(B) and has spent more than 99.90 

percent of the DSH allotments for the State on 

average for the period of fiscal years 2004 through 
H. R. 3590—803 

2008, as of September 30, 2009, the applicable 

percentage is equal to 17.5 percent; 

‘‘(III) if the State is not a low DSH State 

described in paragraph (5)(B) and has spent not 

more than 99.90 percent of the DSH allotments 

for the State on average for the period of fiscal 

years 2004 through 2008, as of September 30, 

2009, the applicable percentage is equal to 50 percent; and 

‘‘(IV) if the State is not a low DSH State 

described in paragraph (5)(B) and has spent more 

than 99.90 percent of the DSH allotments for the 

State on average for the period of fiscal years 

2004 through 2008, as of September 30, 2009, the 

applicable percentage is equal to 35 percent.’’; 

(II) in clause (ii), by striking subclauses (I) and 

(II), and inserting the following: 

‘‘(I) if the State is a low DSH State described 

in paragraph (5)(B) and has spent not more than 

99.90 percent of the DSH allotments for the State 

on average for the period of fiscal years 2004 

through 2008, as of September 30, 2009, the 

applicable percentage is equal to the product of 

the percentage reduction in uncovered individuals 

for the fiscal year from the preceding fiscal year 

and 27.5 percent; 

‘‘(II) if the State is a low DSH State described 

in paragraph (5)(B) and has spent more than 99.90 

percent of the DSH allotments for the State on 

average for the period of fiscal years 2004 through 

2008, as of September 30, 2009, the applicable 

percentage is equal to the product of the percentage reduction in uncovered individuals for the 

fiscal year from the preceding fiscal year and 20 

percent; 

‘‘(III) if the State is not a low DSH State 

described in paragraph (5)(B) and has spent not 

more than 99.90 percent of the DSH allotments 

for the State on average for the period of fiscal 

years 2004 through 2008, as of September 30, 

2009, the applicable percentage is equal to the 

product of the percentage reduction in uncovered 

individuals for the fiscal year from the preceding 

fiscal year and 55 percent; and 

‘‘(IV) if the State is not a low DSH State 

described in paragraph (5)(B) and has spent more 

than 99.90 percent of the DSH allotments for the 

State on average for the period of fiscal years 

2004 through 2008, as of September 30, 2009, the 

applicable percentage is equal to the product of 

the percentage reduction in uncovered individuals 

for the fiscal year from the preceding fiscal year 

and 40 percent.’’; 

(III) in subparagraph (E), by striking ‘‘35 percent’’ 

and inserting ‘‘50 percent’’; and 

(IV) by adding at the end the following: 
H. R. 3590—804 

‘‘(G) NONAPPLICATION.—The preceding provisions of 

this paragraph shall not apply to the DSH allotment determined for the State of Hawaii for a fiscal year under 

paragraph (6).’’. 

(f) Section 2551 of this Act is amended by striking subsection 

(b). 

(g) Section 2105(d)(3)(B) of the Social Security Act (42 U.S.C. 

1397ee(d)(3)(B)), as added by section 2101(b)(1), is amended by 

adding at the end the following: ‘‘For purposes of eligibility for 

premium assistance for the purchase of a qualified health plan 

under section 36B of the Internal Revenue Code of 1986 and reduced 

cost-sharing under section 1402 of the Patient Protection and 

Affordable Care Act, children described in the preceding sentence 

shall be deemed to be ineligible for coverage under the State child 

health plan.’’. 

(h) Clause (i) of subparagraph (C) of section 513(b)(2) of the 

Social Security Act, as added by section 2953 of this Act, is amended 

to read as follows: 

‘‘(i) Healthy relationships, including marriage and 

family interactions.’’. 

(i) Section 1115 of the Social Security Act (42 U.S.C. 1315) 

is amended by inserting after subsection (c) the following: 

‘‘(d)(1) An application or renewal of any experimental, pilot, 

or demonstration project undertaken under subsection (a) to promote the objectives of title XIX or XXI in a State that would 

result in an impact on eligibility, enrollment, benefits, cost-sharing, 

or financing with respect to a State program under title XIX or 

XXI (in this subsection referred to as a ‘demonstration project’) 

shall be considered by the Secretary in accordance with the regulations required to be promulgated under paragraph (2). 

‘‘(2) Not later than 180 days after the date of enactment of 

this subsection, the Secretary shall promulgate regulations relating 

to applications for, and renewals of, a demonstration project that 

provide for— 

‘‘(A) a process for public notice and comment at the State 

level, including public hearings, sufficient to ensure a meaningful level of public input; 

‘‘(B) requirements relating to— 

‘‘(i) the goals of the program to be implemented or 

renewed under the demonstration project; 

‘‘(ii) the expected State and Federal costs and coverage 

projections of the demonstration project; and 

‘‘(iii) the specific plans of the State to ensure that 

the demonstration project will be in compliance with title 

XIX or XXI; 

‘‘(C) a process for providing public notice and comment 

after the application is received by the Secretary, that is sufficient to ensure a meaningful level of public input; 

‘‘(D) a process for the submission to the Secretary of periodic reports by the State concerning the implementation of 

the demonstration project; and 

‘‘(E) a process for the periodic evaluation by the Secretary 

of the demonstration project. 

‘‘(3) The Secretary shall annually report to Congress concerning 

actions taken by the Secretary with respect to applications for 

demonstration projects under this section.’’. 
H. R. 3590—805 

(j) Subtitle F of title III of this Act is amended by adding 

at the end the following: 

‘‘SEC. 3512. GAO STUDY AND REPORT ON CAUSES OF ACTION. 

‘‘(a) STUDY.— ‘‘(1) IN GENERAL.—The Comptroller General of the United 

States shall conduct a study of whether the development, recognition, or implementation of any guideline or other standards 

under a provision described in paragraph (2) would result in 

the establishment of a new cause of action or claim. 

‘‘(2) PROVISIONS DESCRIBED.—The provisions described in 

this paragraph include the following: 

‘‘(A) Section 2701 (adult health quality measures). 

‘‘(B) Section 2702 (payment adjustments for health care 

acquired conditions). 

‘‘(C) Section 3001 (Hospital Value-Based Purchase Program). 

‘‘(D) Section 3002 (improvements to the Physician 

Quality Reporting Initiative). 

‘‘(E) Section 3003 (improvements to the Physician Feedback Program). 

‘‘(F) Section 3007 (value based payment modifier under 

physician fee schedule). 

‘‘(G) Section 3008 (payment adjustment for conditions 

acquired in hospitals). 

‘‘(H) Section 3013 (quality measure development). 

‘‘(I) Section 3014 (quality measurement). 

‘‘(J) Section 3021 (Establishment of Center for Medicare and Medicaid Innovation). 

‘‘(K) Section 3025 (hospital readmission reduction program). 

‘‘(L) Section 3501 (health care delivery system research, 

quality improvement). 

‘‘(M) Section 4003 (Task Force on Clinical and Preventive Services). 

‘‘(N) Section 4301 (research to optimize deliver of public 

health services). 

‘‘(b) REPORT.—Not later than 2 years after the date of enactment of this Act, the Comptroller General of the United States 

shall submit to the appropriate committees of Congress, a report 

containing the findings made by the Comptroller General under 

the study under subsection (a).’’. 

SEC. 10202. INCENTIVES FOR STATES TO OFFER HOME AND COMMUNITY-BASED SERVICES AS A LONG-TERM CARE ALTERNATIVE TO NURSING HOMES. 

(a) STATE BALANCING INCENTIVE PAYMENTS PROGRAM.—Notwithstanding section 1905(b) of the Social Security Act (42 U.S.C. 

1396d(b)), in the case of a balancing incentive payment State, 

as defined in subsection (b), that meets the conditions described 

in subsection (c), during the balancing incentive period, the Federal 

medical assistance percentage determined for the State under section 1905(b) of such Act and, if applicable, increased under subsection (z) or (aa) shall be increased by the applicable percentage 

points determined under subsection (d) with respect to eligible 

medical assistance expenditures described in subsection (e). 

(b) BALANCING INCENTIVE PAYMENT STATE.—A balancing incentive payment State is a State— 
H. R. 3590—806 

(1) in which less than 50 percent of the total expenditures 

for medical assistance under the State Medicaid program for 

a fiscal year for long-term services and supports (as defined 

by the Secretary under subsection (f))(1)) are for non-institutionally-based long-term services and supports described in subsection (f)(1)(B); 

(2) that submits an application and meets the conditions 

described in subsection (c); and 

(3) that is selected by the Secretary to participate in the 

State balancing incentive payment program established under 

this section. 

(c) CONDITIONS.—The conditions described in this subsection 

are the following: 

(1) APPLICATION.—The State submits an application to the 

Secretary that includes, in addition to such other information 

as the Secretary shall require— 

(A) a proposed budget that details the State’s plan 

to expand and diversify medical assistance for non-institutionally-based long-term services and supports described 

in subsection (f)(1)(B) under the State Medicaid program 

during the balancing incentive period and achieve the target spending percentage applicable to the State under paragraph (2), including through structural changes to how 

the State furnishes such assistance, such as through the 

establishment of a ‘‘no wrong door—single entry point 

system’’, optional presumptive eligibility, case management 

services, and the use of core standardized assessment 

instruments, and that includes a description of the new 

or expanded offerings of such services that the State will 

provide and the projected costs of such services; and 

(B) in the case of a State that proposes to expand 

the provision of home and community-based services under 

its State Medicaid program through a State plan amendment under section 1915(i) of the Social Security Act, at 

the option of the State, an election to increase the income 

eligibility for such services from 150 percent of the poverty 

line to such higher percentage as the State may establish 

for such purpose, not to exceed 300 percent of the supplemental security income benefit rate established by section 

1611(b)(1) of the Social Security Act (42 U.S.C. 1382(b)(1)). 

(2) TARGET SPENDING PERCENTAGES.— 

(A) In the case of a balancing incentive payment State 

in which less than 25 percent of the total expenditures 

for long-term services and supports under the State Medicaid program for fiscal year 2009 are for home and community-based services, the target spending percentage for the 

State to achieve by not later than October 1, 2015, is 

that 25 percent of the total expenditures for long-term 

services and supports under the State Medicaid program 

are for home and community-based services. 

(B) In the case of any other balancing incentive payment State, the target spending percentage for the State 

to achieve by not later than October 1, 2015, is that 50 

percent of the total expenditures for long-term services 

and supports under the State Medicaid program are for 

home and community-based services. 
H. R. 3590—807 

(3) MAINTENANCE OF ELIGIBILITY REQUIREMENTS.—The 

State does not apply eligibility standards, methodologies, or 

procedures for determining eligibility for medical assistance 

for non-institutionally-based long-term services and supports 

described in subsection (f)(1)(B) under the State Medicaid program that are more restrictive than the eligibility standards, 

methodologies, or procedures in effect for such purposes on 

December 31, 2010. 

(4) USE OF ADDITIONAL FUNDS.—The State agrees to use 

the additional Federal funds paid to the State as a result 

of this section only for purposes of providing new or expanded 

offerings of non-institutionally-based long-term services and 

supports described in subsection (f)(1)(B) under the State Medicaid program. 

(5) STRUCTURAL CHANGES.—The State agrees to make, not 

later than the end of the 6-month period that begins on the 

date the State submits an application under this section, the 

following changes: 

(A) ‘‘NO WRONG DOOR—SINGLE ENTRY POINT SYSTEM’’.— 

Development of a statewide system to enable consumers 

to access all long-term services and supports through an 

agency, organization, coordinated network, or portal, in 

accordance with such standards as the State shall establish 

and that shall provide information regarding the availability of such services, how to apply for such services, 

referral services for services and supports otherwise available in the community, and determinations of financial 

and functional eligibility for such services and supports, 

or assistance with assessment processes for financial and 

functional eligibility. 

(B) CONFLICT-FREE CASE MANAGEMENT SERVICES.—Conflict-free case management services to develop a service 

plan, arrange for services and supports, support the beneficiary (and, if appropriate, the beneficiary’s caregivers) 

in directing the provision of services and supports for the 

beneficiary, and conduct ongoing monitoring to assure that 

services and supports are delivered to meet the beneficiary’s needs and achieve intended outcomes. 

(C) CORE STANDARDIZED ASSESSMENT INSTRUMENTS.— 

Development of core standardized assessment instruments 

for determining eligibility for non-institutionally-based 

long-term services and supports described in subsection 

(f)(1)(B), which shall be used in a uniform manner throughout the State, to determine a beneficiary’s needs for 

training, support services, medical care, transportation, and 

other services, and develop an individual service plan to 

address such needs. 

(6) DATA COLLECTION.—The State agrees to collect from 

providers of services and through such other means as the 

State determines appropriate the following data: 

(A) SERVICES DATA.—Services data from providers of 

non-institutionally-based long-term services and supports 

described in subsection (f)(1)(B) on a per-beneficiary basis 

and in accordance with such standardized coding procedures as the State shall establish in consultation with 

the Secretary. 
H. R. 3590—808 

(B) QUALITY DATA.—Quality data on a selected set 

of core quality measures agreed upon by the Secretary 

and the State that are linked to population-specific outcomes measures and accessible to providers. 

(C) OUTCOMES MEASURES.—Outcomes measures data 

on a selected set of core population-specific outcomes measures agreed upon by the Secretary and the State that 

are accessible to providers and include— 

(i) measures of beneficiary and family caregiver 

experience with providers; 

(ii) measures of beneficiary and family caregiver 

satisfaction with services; and 

(iii) measures for achieving desired outcomes 

appropriate to a specific beneficiary, including employment, participation in community life, health stability, 

and prevention of loss in function. 

(d) APPLICABLE PERCENTAGE POINTS INCREASE IN FMAP.—The 

applicable percentage points increase is— 

(1) in the case of a balancing incentive payment State 

subject to the target spending percentage described in subsection (c)(2)(A), 5 percentage points; and 

(2) in the case of any other balancing incentive payment 

State, 2 percentage points. 

(e) ELIGIBLE MEDICAL ASSISTANCE EXPENDITURES.— 

(1) IN GENERAL.—Subject to paragraph (2), medical assistance described in this subsection is medical assistance for noninstitutionally-based long-term services and supports described 

in subsection (f)(1)(B) that is provided by a balancing incentive 

payment State under its State Medicaid program during the 

balancing incentive payment period. 

(2) LIMITATION ON PAYMENTS.—In no case may the aggregate amount of payments made by the Secretary to balancing 

incentive payment States under this section during the balancing incentive period exceed $3,000,000,000. 

(f) DEFINITIONS.—In this section: 

(1) LONG-TERM SERVICES AND SUPPORTS DEFINED.—The 

term ‘‘long-term services and supports’’ has the meaning given 

that term by Secretary and may include any of the following 

(as defined for purposes of State Medicaid programs): 

(A) INSTITUTIONALLY-BASED LONG-TERM SERVICES AND

SUPPORTS.—Services provided in an institution, including 

the following: 

(i) Nursing facility services. 

(ii) Services in an intermediate care facility for 

the mentally retarded described in subsection (a)(15) 

of section 1905 of such Act. 

(B) NON-INSTITUTIONALLY-BASED LONG-TERM SERVICES

AND SUPPORTS.—Services not provided in an institution, 

including the following: 

(i) Home and community-based services provided 

under subsection (c), (d), or (i) of section 1915 of such 

Act or under a waiver under section 1115 of such 

Act. 

(ii) Home health care services. 

(iii) Personal care services. 
H. R. 3590—809 

(iv) Services described in subsection (a)(26) of section 1905 of such Act (relating to PACE program services). 

(v) Self-directed personal assistance services 

described in section 1915(j) of such Act. 

(2) BALANCING INCENTIVE PERIOD.—The term ‘‘balancing 

incentive period’’ means the period that begins on October 

1, 2011, and ends on September 30, 2015. 

(3) POVERTY LINE.—The term ‘‘poverty line’’ has the 

meaning given that term in section 2110(c)(5) of the Social 

Security Act (42 U.S.C. 1397jj(c)(5)). 

(4) STATE MEDICAID PROGRAM.—The term ‘‘State Medicaid 

program’’ means the State program for medical assistance provided under a State plan under title XIX of the Social Security 

Act and under any waiver approved with respect to such State 

plan. 

SEC. 10203. EXTENSION OF FUNDING FOR CHIP THROUGH FISCAL YEAR 

2015 AND OTHER CHIP-RELATED PROVISIONS. 

(a) Section 1311(c)(1) of this Act is amended by striking ‘‘and’’ 

at the end of subparagraph (G), by striking the period at the 

end of subparagraph (H) and inserting ‘‘; and’’, and by adding 

at the end the following: 

‘‘(I) report to the Secretary at least annually and in 

such manner as the Secretary shall require, pediatric 

quality reporting measures consistent with the pediatric 

quality reporting measures established under section 

1139A of the Social Security Act.’’. 

(b) Effective as if included in the enactment of the Children’s 

Health Insurance Program Reauthorization Act of 2009 (Public 

Law 111–3): 

(1) Section 1906(e)(2) of the Social Security Act (42 U.S.C. 

1396e(e)(2)) is amended by striking ‘‘means’’ and all that follows 

through the period and inserting ‘‘has the meaning given that 

term in section 2105(c)(3)(A).’’. 

(2)(A) Section 1906A(a) of the Social Security Act (42 U.S.C. 

1396e–1(a)), is amended by inserting before the period the 

following: ‘‘and the offering of such a subsidy is cost-effective, 

as defined for purposes of section 2105(c)(3)(A)’’. 

(B) This Act shall be applied without regard to subparagraph (A) of section 2003(a)(1) of this Act and that subparagraph and the amendment made by that subparagraph are 

hereby deemed null, void, and of no effect. 

(3) Section 2105(c)(10) of the Social Security Act (42 U.S.C. 

1397ee(c)(10)) is amended— 

(A) in subparagraph (A), in the first sentence, by 

inserting before the period the following: ‘‘if the offering 

of such a subsidy is cost-effective, as defined for purposes 

of paragraph (3)(A)’’; 

(B) by striking subparagraph (M); and 

(C) by redesignating subparagraph (N) as subparagraph (M). 

(4) Section 2105(c)(3)(A) of the Social Security Act (42 

U.S.C. 1397ee(c)(3)(A)) is amended— 

(A) in the matter preceding clause (i), by striking ‘‘to’’ 

and inserting ‘‘to—’’; and 
H. R. 3590—810 

(B) in clause (ii), by striking the period and inserting 

a semicolon. 

(c) Section 2105 of the Social Security Act (42 U.S.C. 1397ee), 

as amended by section 2101, is amended— 

(1) in subsection (b), in the second sentence, by striking 

‘‘2013’’ and inserting ‘‘2015’’; and 

(2) in subsection (d)(3)— 

(A) in subparagraph (A)— 

(i) in the first sentence, by inserting ‘‘as a condition 

of receiving payments under section 1903(a),’’ after 

‘‘2019,’’; 

(ii) in clause (i), by striking ‘‘or’’ at the end; 

(iii) by redesignating clause (ii) as clause (iii); and 

(iv) by inserting after clause (i), the following: 

‘‘(ii) after September 30, 2015, enrolling children 

eligible to be targeted low-income children under the 

State child health plan in a qualified health plan that 

has been certified by the Secretary under subparagraph 

(C); or’’; 

(B) in subparagraph (B), by striking ‘‘provided coverage’’ and inserting ‘‘screened for eligibility for medical 

assistance under the State plan under title XIX or a waiver 

of that plan and, if found eligible, enrolled in such plan 

or a waiver. In the case of such children who, as a result 

of such screening, are determined to not be eligible for 

medical assistance under the State plan or a waiver under 

title XIX, the State shall establish procedures to ensure 

that the children are enrolled in a qualified health plan 

that has been certified by the Secretary under subparagraph (C) and is offered’’; and 

(C) by adding at the end the following: 

‘‘(C) CERTIFICATION OF COMPARABILITY OF PEDIATRIC

COVERAGE OFFERED BY QUALIFIED HEALTH PLANS.—With 

respect to each State, the Secretary, not later than April 

1, 2015, shall review the benefits offered for children and 

the cost-sharing imposed with respect to such benefits by 

qualified health plans offered through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act and shall certify those plans 

that offer benefits for children and impose cost-sharing 

with respect to such benefits that the Secretary determines 

are at least comparable to the benefits offered and costsharing protections provided under the State child health 

plan.’’. 

(d)(1) Section 2104(a) of such Act (42 U.S.C. 1397dd(a)) is 

amended— 

(A) in paragraph (15), by striking ‘‘and’’ at the end; and 

(B) by striking paragraph (16) and inserting the following: 

‘‘(16) for fiscal year 2013, $17,406,000,000; 

‘‘(17) for fiscal year 2014, $19,147,000,000; and 

‘‘(18) for fiscal year 2015, for purposes of making 2 semiannual allotments— 

‘‘(A) $2,850,000,000 for the period beginning on October 

1, 2014, and ending on March 31, 2015, and 

‘‘(B) $2,850,000,000 for the period beginning on April 

1, 2015, and ending on September 30, 2015.’’. 
H. R. 3590—811 

(2)(A) Section 2104(m) of such Act (42 U.S.C. 1397dd(m)), as 

amended by section 2102(a)(1), is amended— 

(i) in the subsection heading, by striking ‘‘2013’’ and 

inserting ‘‘2015’’; 

(ii) in paragraph (2)— 

(I) in the paragraph heading, by striking ‘‘2012’’ and 

inserting ‘‘2014’’; and 

(II) by adding at the end the following: 

‘‘(B) FISCAL YEARS 2013 AND 2014.—Subject to paragraphs (4) and (6), from the amount made available under 

paragraphs (16) and (17) of subsection (a) for fiscal years 

2013 and 2014, respectively, the Secretary shall compute 

a State allotment for each State (including the District 

of Columbia and each commonwealth and territory) for 

each such fiscal year as follows: 

‘‘(i) REBASING IN FISCAL YEAR 2013.—For fiscal year 

2013, the allotment of the State is equal to the Federal 

payments to the State that are attributable to (and 

countable towards) the total amount of allotments 

available under this section to the State in fiscal year 

2012 (including payments made to the State under 

subsection (n) for fiscal year 2012 as well as amounts 

redistributed to the State in fiscal year 2012), multiplied by the allotment increase factor under paragraph 

(5) for fiscal year 2013. 

‘‘(ii) GROWTH FACTOR UPDATE FOR FISCAL YEAR

2014.—For fiscal year 2014, the allotment of the State 

is equal to the sum of— 

‘‘(I) the amount of the State allotment under 

clause (i) for fiscal year 2013; and 

‘‘(II) the amount of any payments made to 

the State under subsection (n) for fiscal year 2013, 

multiplied by the allotment increase factor under paragraph (5) for fiscal year 2014.’’; 

(iii) in paragraph (3)— 

(I) in the paragraph heading, by striking ‘‘2013’’ 

and inserting ‘‘2015’’; 

(II) in subparagraphs (A) and (B), by striking 

‘‘paragraph (16)’’ each place it appears and inserting 

‘‘paragraph (18)’’; 

(III) in subparagraph (C)— 

(aa) by striking ‘‘2012’’ each place it appears 

and inserting ‘‘2014’’; and 

(bb) by striking ‘‘2013’’ and inserting ‘‘2015’’; 

and 

(IV) in subparagraph (D)— 

(aa) in clause (i)(I), by striking ‘‘subsection 

(a)(16)(A)’’ and inserting ‘‘subsection (a)(18)(A)’’; 

and 

(bb) in clause (ii)(II), by striking ‘‘subsection 

(a)(16)(B)’’ and inserting ‘‘subsection (a)(18)(B)’’; 

(iv) in paragraph (4), by striking ‘‘2013’’ and inserting 

‘‘2015’’; 

(v) in paragraph (6)— 

(I) in subparagraph (A), by striking ‘‘2013’’ and 

inserting ‘‘2015’’; and 
H. R. 3590—812 

(II) in the flush language after and below subparagraph (B)(ii), by striking ‘‘or fiscal year 2012’’ and 

inserting ‘‘, fiscal year 2012, or fiscal year 2014’’; and 

(vi) in paragraph (8)— 

(I) in the paragraph heading, by striking ‘‘2013’’ 

and inserting ‘‘2015’’; and 

(II) by striking ‘‘2013’’ and inserting ‘‘2015’’. 

(B) Section 2104(n) of such Act (42 U.S.C. 1397dd(n)) is 

amended— 

(i) in paragraph (2)— 

(I) in subparagraph (A)(ii)— 

(aa) by striking ‘‘2012’’ and inserting ‘‘2014’’; and 

(bb) by striking ‘‘2013’’ and inserting ‘‘2015’’; 

(II) in subparagraph (B)— 

(aa) by striking ‘‘2012’’ and inserting ‘‘2014’’; and 

(bb) by striking ‘‘2013’’ and inserting ‘‘2015’’; and 

(ii) in paragraph (3)(A), by striking ‘‘or a semi-annual allotment period for fiscal year 2013’’ and inserting ‘‘fiscal year 

2013, fiscal year 2014, or a semi-annual allotment period for 

fiscal year 2015’’. 

(C) Section 2105(g)(4) of such Act (42 U.S.C. 1397ee(g)(4)) is 

amended— 

(i) in the paragraph heading, by striking ‘‘2013’’ and 

inserting ‘‘2015’’; and 

(ii) in subparagraph (A), by striking ‘‘2013’’ and inserting 

‘‘2015’’. 

(D) Section 2110(b) of such Act (42 U.S.C. 1397jj(b)) is 

amended— 

(i) in paragraph (2)(B), by inserting ‘‘except as provided 

in paragraph (6),’’ before ‘‘a child’’; and 

(ii) by adding at the end the following new paragraph: 

‘‘(6) EXCEPTIONS TO EXCLUSION OF CHILDREN OF EMPLOYEES

OF A PUBLIC AGENCY IN THE STATE.— 

‘‘(A) IN GENERAL.—A child shall not be considered to 

be described in paragraph (2)(B) if— 

‘‘(i) the public agency that employs a member of 

the child’s family to which such paragraph applies 

satisfies subparagraph (B); or 

‘‘(ii) subparagraph (C) applies to such child. 

‘‘(B) MAINTENANCE OF EFFORT WITH RESPECT TO PER

PERSON AGENCY CONTRIBUTION FOR FAMILY COVERAGE.— 

For purposes of subparagraph (A)(i), a public agency satisfies this subparagraph if the amount of annual agency 

expenditures made on behalf of each employee enrolled 

in health coverage paid for by the agency that includes 

dependent coverage for the most recent State fiscal year 

is not less than the amount of such expenditures made 

by the agency for the 1997 State fiscal year, increased 

by the percentage increase in the medical care expenditure 

category of the Consumer Price Index for All-Urban Consumers (all items: U.S. City Average) for such preceding 

fiscal year. 

‘‘(C) HARDSHIP EXCEPTION.—For purposes of subparagraph (A)(ii), this subparagraph applies to a child if the 

State determines, on a case-by-case basis, that the annual 

aggregate amount of premiums and cost-sharing imposed 
H. R. 3590—813 

for coverage of the family of the child would exceed 5 

percent of such family’s income for the year involved.’’. 

(E) Section 2113 of such Act (42 U.S.C. 1397mm) is amended— 

(i) in subsection (a)(1), by striking ‘‘2013’’ and inserting 

‘‘2015’’; and 

(ii) in subsection (g), by striking ‘‘$100,000,000 for the 

period of fiscal years 2009 through 2013’’ and inserting 

‘‘$140,000,000 for the period of fiscal years 2009 through 2015’’. 

(F) Section 108 of Public Law 111–3 is amended by striking 

‘‘$11,706,000,000’’ and all that follows through the second sentence 

and inserting ‘‘$15,361,000,000 to accompany the allotment made 

for the period beginning on October 1, 2014, and ending on March 

31, 2015, under section 2104(a)(18)(A) of the Social Security Act 

(42 U.S.C. 1397dd(a)(18)(A)), to remain available until expended. 

Such amount shall be used to provide allotments to States under 

paragraph (3) of section 2104(m) of the Social Security Act (42 

U.S.C. 1397dd(m)) for the first 6 months of fiscal year 2015 in 

the same manner as allotments are provided under subsection 

(a)(18)(A) of such section 2104 and subject to the same terms 

and conditions as apply to the allotments provided from such subsection (a)(18)(A).’’. 

PART II—SUPPORT FOR PREGNANT AND 

PARENTING TEENS AND WOMEN 

SEC. 10211. DEFINITIONS. 

In this part: 

(1) ACCOMPANIMENT.—The term ‘‘accompaniment’’ means 

assisting, representing, and accompanying a woman in seeking 

judicial relief for child support, child custody, restraining 

orders, and restitution for harm to persons and property, and 

in filing criminal charges, and may include the payment of 

court costs and reasonable attorney and witness fees associated 

therewith. 

(2) ELIGIBLE INSTITUTION OF HIGHER EDUCATION.—The term 

‘‘eligible institution of higher education’’ means an institution 

of higher education (as such term is defined in section 101 

of the Higher Education Act of 1965 (20 U.S.C. 1001)) that 

has established and operates, or agrees to establish and operate 

upon the receipt of a grant under this part, a pregnant and 

parenting student services office. 

(3) COMMUNITY SERVICE CENTER.—The term ‘‘community 

service center’’ means a non-profit organization that provides 

social services to residents of a specific geographical area via 

direct service or by contract with a local governmental agency. 

(4) HIGH SCHOOL.—The term ‘‘high school’’ means any 

public or private school that operates grades 10 through 12, 

inclusive, grades 9 through 12, inclusive or grades 7 through 

12, inclusive. 

(5) INTERVENTION SERVICES.—The term ‘‘intervention services’’ means, with respect to domestic violence, sexual violence, 

sexual assault, or stalking, 24-hour telephone hotline services 

for police protection and referral to shelters. 

(6) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 
H. R. 3590—814 

(7) STATE.—The term ‘‘State’’ includes the District of 

Columbia, any commonwealth, possession, or other territory 

of the United States, and any Indian tribe or reservation. 

(8) SUPPORTIVE SOCIAL SERVICES.—The term ‘‘supportive 

social services’’ means transitional and permanent housing, 

vocational counseling, and individual and group counseling 

aimed at preventing domestic violence, sexual violence, sexual 

assault, or stalking. 

(9) VIOLENCE.—The term ‘‘violence’’ means actual violence 

and the risk or threat of violence. 

SEC. 10212. ESTABLISHMENT OF PREGNANCY ASSISTANCE FUND. 

(a) IN GENERAL.—The Secretary, in collaboration and coordination with the Secretary of Education (as appropriate), shall establish 

a Pregnancy Assistance Fund to be administered by the Secretary, 

for the purpose of awarding competitive grants to States to assist 

pregnant and parenting teens and women. 

(b) USE OF FUND.—A State may apply for a grant under subsection (a) to carry out any activities provided for in section 10213. 

(c) APPLICATIONS.—To be eligible to receive a grant under subsection (a), a State shall submit to the Secretary an application 

at such time, in such manner, and containing such information 

as the Secretary may require, including a description of the purposes for which the grant is being requested and the designation 

of a State agency for receipt and administration of funding received 

under this part. 

SEC. 10213. PERMISSIBLE USES OF FUND. 

(a) IN GENERAL.—A State shall use amounts received under 

a grant under section 10212 for the purposes described in this 

section to assist pregnant and parenting teens and women. 

(b) INSTITUTIONS OF HIGHER EDUCATION.— (1) IN GENERAL.—A State may use amounts received under 

a grant under section 10212 to make funding available to 

eligible institutions of higher education to enable the eligible 

institutions to establish, maintain, or operate pregnant and 

parenting student services. Such funding shall be used to 

supplement, not supplant, existing funding for such services. 

(2) APPLICATION.—An eligible institution of higher education that desires to receive funding under this subsection 

shall submit an application to the designated State agency 

at such time, in such manner, and containing such information 

as the State agency may require. 

(3) MATCHING REQUIREMENT.—An eligible institution of 

higher education that receives funding under this subsection 

shall contribute to the conduct of the pregnant and parenting 

student services office supported by the funding an amount 

from non-Federal funds equal to 25 percent of the amount 

of the funding provided. The non-Federal share may be in 

cash or in-kind, fairly evaluated, including services, facilities, 

supplies, or equipment. 

(4) USE OF FUNDS FOR ASSISTING PREGNANT AND PARENTING

COLLEGE STUDENTS.—An eligible institution of higher education 

that receives funding under this subsection shall use such 

funds to establish, maintain or operate pregnant and parenting 

student services and may use such funding for the following 

programs and activities: 
H. R. 3590—815 

(A) Conduct a needs assessment on campus and within 

the local community— 

(i) to assess pregnancy and parenting resources, 

located on the campus or within the local community, 

that are available to meet the needs described in 

subparagraph (B); and 

(ii) to set goals for— 

(I) improving such resources for pregnant, parenting, and prospective parenting students; and 

(II) improving access to such resources. 

(B) Annually assess the performance of the eligible 

institution in meeting the following needs of students 

enrolled in the eligible institution who are pregnant or 

are parents: 

(i) The inclusion of maternity coverage and the 

availability of riders for additional family members 

in student health care. 

(ii) Family housing. 

(iii) Child care. 

(iv) Flexible or alternative academic scheduling, 

such as telecommuting programs, to enable pregnant 

or parenting students to continue their education or 

stay in school. 

(v) Education to improve parenting skills for mothers and fathers and to strengthen marriages. 

(vi) Maternity and baby clothing, baby food 

(including formula), baby furniture, and similar items 

to assist parents and prospective parents in meeting 

the material needs of their children. 

(vii) Post-partum counseling. 

(C) Identify public and private service providers, 

located on the campus of the eligible institution or within 

the local community, that are qualified to meet the needs 

described in subparagraph (B), and establishes programs 

with qualified providers to meet such needs. 

(D) Assist pregnant and parenting students, fathers 

or spouses in locating and obtaining services that meet 

the needs described in subparagraph (B). 

(E) If appropriate, provide referrals for prenatal care 

and delivery, infant or foster care, or adoption, to a student 

who requests such information. An office shall make such 

referrals only to service providers that serve the following 

types of individuals: 

(i) Parents. 

(ii) Prospective parents awaiting adoption. 

(iii) Women who are pregnant and plan on parenting or placing the child for adoption. 

(iv) Parenting or prospective parenting couples. 

(5) REPORTING.— 

(A) ANNUAL REPORT BY INSTITUTIONS.— 

(i) IN GENERAL.—For each fiscal year that an 

eligible institution of higher education receives funds 

under this subsection, the eligible institution shall prepare and submit to the State, by the date determined 

by the State, a report that— 
H. R. 3590—816 

(I) itemizes the pregnant and parenting student services office’s expenditures for the fiscal 

year; 

(II) contains a review and evaluation of the 

performance of the office in fulfilling the requirements of this section, using the specific performance criteria or standards established under 

subparagraph (B)(i); and 

(III) describes the achievement of the office 

in meeting the needs listed in paragraph (4)(B) 

of the students served by the eligible institution, 

and the frequency of use of the office by such 

students. 

(ii) PERFORMANCE CRITERIA.—Not later than 180 

days before the date the annual report described in 

clause (i) is submitted, the State— 

(I) shall identify the specific performance criteria or standards that shall be used to prepare 

the report; and 

(II) may establish the form or format of the 

report. 

(B) REPORT BY STATE.—The State shall annually prepare and submit a report on the findings under this subsection, including the number of eligible institutions of 

higher education that were awarded funds and the number 

of students served by each pregnant and parenting student 

services office receiving funds under this section, to the 

Secretary. 

(c) SUPPORT FOR PREGNANT AND PARENTING TEENS.—A State 

may use amounts received under a grant under section 10212 

to make funding available to eligible high schools and community 

service centers to establish, maintain or operate pregnant and parenting services in the same general manner and in accordance 

with all conditions and requirements described in subsection (b), 

except that paragraph (3) of such subsection shall not apply for 

purposes of this subsection. 

(d) IMPROVING SERVICES FOR PREGNANT WOMEN WHO ARE VICTIMS OF DOMESTIC VIOLENCE, SEXUAL VIOLENCE, SEXUAL ASSAULT, 

AND STALKING.— 

(1) IN GENERAL.—A State may use amounts received under 

a grant under section 10212 to make funding available tp 

its State Attorney General to assist Statewide offices in providing— 

(A) intervention services, accompaniment, and supportive social services for eligible pregnant women who 

are victims of domestic violence, sexual violence, sexual 

assault, or stalking. 

(B) technical assistance and training (as described in 

subsection (c)) relating to violence against eligible pregnant 

women to be made available to the following: 

(i) Federal, State, tribal, territorial, and local 

governments, law enforcement agencies, and courts. 

(ii) Professionals working in legal, social service, 

and health care settings. 

(iii) Nonprofit organizations. 

(iv) Faith-based organizations. 
H. R. 3590—817 

(2) ELIGIBILITY.—To be eligible for a grant under paragraph 

(1), a State Attorney General shall submit an application to 

the designated State agency at such time, in such manner, 

and containing such information, as specified by the State. 

(3) TECHNICAL ASSISTANCE AND TRAINING DESCRIBED.—For 

purposes of paragraph (1)(B), technical assistance and training 

is— 

(A) the identification of eligible pregnant women 

experiencing domestic violence, sexual violence, sexual 

assault, or stalking; 

(B) the assessment of the immediate and short-term 

safety of such a pregnant woman, the evaluation of the 

impact of the violence or stalking on the pregnant woman’s 

health, and the assistance of the pregnant woman in developing a plan aimed at preventing further domestic violence, 

sexual violence, sexual assault, or stalking, as appropriate; 

(C) the maintenance of complete medical or forensic 

records that include the documentation of any examination, 

treatment given, and referrals made, recording the location 

and nature of the pregnant woman’s injuries, and the 

establishment of mechanisms to ensure the privacy and 

confidentiality of those medical records; and 

(D) the identification and referral of the pregnant 

woman to appropriate public and private nonprofit entities 

that provide intervention services, accompaniment, and 

supportive social services. 

(4) ELIGIBLE PREGNANT WOMAN.—In this subsection, the 

term ‘‘eligible pregnant woman’’ means any woman who is 

pregnant on the date on which such woman becomes a victim 

of domestic violence, sexual violence, sexual assault, or stalking 

or who was pregnant during the one-year period before such 

date. 

(e) PUBLIC AWARENESS AND EDUCATION.—A State may use 

amounts received under a grant under section 10212 to make 

funding available to increase public awareness and education concerning any services available to pregnant and parenting teens 

and women under this part, or any other resources available to 

pregnant and parenting women in keeping with the intent and 

purposes of this part. The State shall be responsible for setting 

guidelines or limits as to how much of funding may be utilized 

for public awareness and education in any funding award. 

SEC. 10214. APPROPRIATIONS. 

There is authorized to be appropriated, and there are appropriated, $25,000,000 for each of fiscal years 2010 through 2019, 

to carry out this part. 

PART III—INDIAN HEALTH CARE 

IMPROVEMENT 

SEC. 10221. INDIAN HEALTH CARE IMPROVEMENT. 

(a) IN GENERAL.—Except as provided in subsection (b), S. 1790 

entitled ‘‘A bill to amend the Indian Health Care Improvement 

Act to revise and extend that Act, and for other purposes.’’, as 

reported by the Committee on Indian Affairs of the Senate in 

December 2009, is enacted into law. 

(b) AMENDMENTS.— 
H. R. 3590—818 

(1) Section 119 of the Indian Health Care Improvement 

Act (as amended by section 111 of the bill referred to in subsection (a)) is amended— 

(A) in subsection (d)— 

(i) in paragraph (2), by striking ‘‘In establishing’’ 

and inserting ‘‘Subject to paragraphs (3) and (4), in 

establishing’’; and 

(ii) by adding at the end the following: 

‘‘(3) ELECTION OF INDIAN TRIBE OR TRIBAL ORGANIZATION.— 

‘‘(A) IN GENERAL.—Subparagraph (B) of paragraph (2) 

shall not apply in the case of an election made by an 

Indian tribe or tribal organization located in a State (other 

than Alaska) in which the use of dental health aide therapist services or midlevel dental health provider services 

is authorized under State law to supply such services in 

accordance with State law. 

‘‘(B) ACTION BY SECRETARY.—On an election by an 

Indian tribe or tribal organization under subparagraph (A), 

the Secretary, acting through the Service, shall facilitate 

implementation of the services elected. 

‘‘(4) VACANCIES.—The Secretary shall not fill any vacancy 

for a certified dentist in a program operated by the Service 

with a dental health aide therapist.’’; and 

(B) by adding at the end the following: 

‘‘(e) EFFECT OF SECTION.—Nothing in this section shall restrict 

the ability of the Service, an Indian tribe, or a tribal organization 

to participate in any program or to provide any service authorized 

by any other Federal law.’’. 

(2) The Indian Health Care Improvement Act (as amended 

by section 134(b) of the bill referred to in subsection (a)) is 

amended by striking section 125 (relating to treatment of scholarships for certain purposes). 

(3) Section 806 of the Indian Health Care Improvement 

Act (25 U.S.C. 1676) is amended— 

(A) by striking ‘‘Any limitation’’ and inserting the following: 

‘‘(a) HHS APPROPRIATIONS.—Any limitation’’; and 

(B) by adding at the end the following: 

‘‘(b) LIMITATIONS PURSUANT TO OTHER FEDERAL LAW.—Any 

limitation pursuant to other Federal laws on the use of Federal 

funds appropriated to the Service shall apply with respect to the 

performance or coverage of abortions.’’. 

(4) The bill referred to in subsection (a) is amended by 

striking section 201. 

Subtitle C—Provisions Relating to Title III 

SEC. 10301. PLANS FOR A VALUE-BASED PURCHASING PROGRAM FOR 

AMBULATORY SURGICAL CENTERS. 

(a) IN GENERAL.—Section 3006 is amended by adding at the 

end the following new subsection: 

‘‘(f) AMBULATORY SURGICAL CENTERS.— 

‘‘(1) IN GENERAL.—The Secretary shall develop a plan to 

implement a value-based purchasing program for payments 

under the Medicare program under title XVIII of the Social 
H. R. 3590—819 

Security Act for ambulatory surgical centers (as described in 

section 1833(i) of the Social Security Act (42 U.S.C. 1395l(i))). 

‘‘(2) DETAILS.—In developing the plan under paragraph 

(1), the Secretary shall consider the following issues: 

‘‘(A) The ongoing development, selection, and modification process for measures (including under section 1890 

of the Social Security Act (42 U.S.C. 1395aaa) and section 

1890A of such Act, as added by section 3014), to the extent 

feasible and practicable, of all dimensions of quality and 

efficiency in ambulatory surgical centers. 

‘‘(B) The reporting, collection, and validation of quality 

data. 

‘‘(C) The structure of value-based payment adjustments, including the determination of thresholds or 

improvements in quality that would substantiate a payment adjustment, the size of such payments, and the 

sources of funding for the value-based bonus payments. 

‘‘(D) Methods for the public disclosure of information 

on the performance of ambulatory surgical centers. 

‘‘(E) Any other issues determined appropriate by the 

Secretary. 

‘‘(3) CONSULTATION.—In developing the plan under paragraph (1), the Secretary shall— 

‘‘(A) consult with relevant affected parties; and 

‘‘(B) consider experience with such demonstrations that 

the Secretary determines are relevant to the value-based 

purchasing program described in paragraph (1). 

‘‘(4) REPORT TO CONGRESS.—Not later than January 1, 2011, 

the Secretary shall submit to Congress a report containing 

the plan developed under paragraph (1).’’. 

(b) TECHNICAL.—Section 3006(a)(2)(A) is amended by striking 

clauses (i) and (ii). 

SEC. 10302. REVISION TO NATIONAL STRATEGY FOR QUALITY 

IMPROVEMENT IN HEALTH CARE. 

Section 399HH(a)(2)(B)(iii) of the Public Health Service Act, 

as added by section 3011, is amended by inserting ‘‘(taking into 

consideration the limitations set forth in subsections (c) and (d) 

of section 1182 of the Social Security Act)’’ after ‘‘information’’. 

SEC. 10303. DEVELOPMENT OF OUTCOME MEASURES. 

(a) DEVELOPMENT.—Section 931 of the Public Health Service 

Act, as added by section 3013(a), is amended by adding at the 

end the following new subsection: 

‘‘(f) DEVELOPMENT OF OUTCOME MEASURES.— ‘‘(1) IN GENERAL.—The Secretary shall develop, and periodically update (not less than every 3 years), provider-level outcome measures for hospitals and physicians, as well as other 

providers as determined appropriate by the Secretary. 

‘‘(2) CATEGORIES OF MEASURES.—The measures developed 

under this subsection shall include, to the extent determined 

appropriate by the Secretary— 

‘‘(A) outcome measurement for acute and chronic diseases, including, to the extent feasible, the 5 most prevalent 

and resource-intensive acute and chronic medical conditions; and 

‘‘(B) outcome measurement for primary and preventative care, including, to the extent feasible, measurements 
H. R. 3590—820 

that cover provision of such care for distinct patient populations (such as healthy children, chronically ill adults, 

or infirm elderly individuals). 

‘‘(3) GOALS.—In developing such measures, the Secretary 

shall seek to— 

‘‘(A) address issues regarding risk adjustment, accountability, and sample size; 

‘‘(B) include the full scope of services that comprise 

a cycle of care; and 

‘‘(C) include multiple dimensions. 

‘‘(4) TIMEFRAME.— 

‘‘(A) ACUTE AND CHRONIC DISEASES.—Not later than 

24 months after the date of enactment of this Act, the 

Secretary shall develop not less than 10 measures described 

in paragraph (2)(A). 

‘‘(B) PRIMARY AND PREVENTIVE CARE.—Not later than 

36 months after the date of enactment of this Act, the 

Secretary shall develop not less than 10 measures described 

in paragraph (2)(B).’’. 

(b) HOSPITAL-ACQUIRED CONDITIONS.—Section 1890A of the 

Social Security Act, as amended by section 3013(b), is amended 

by adding at the end the following new subsection: 

‘‘(f) HOSPITAL ACQUIRED CONDITIONS.—The Secretary shall, to 

the extent practicable, publicly report on measures for hospitalacquired conditions that are currently utilized by the Centers for 

Medicare & Medicaid Services for the adjustment of the amount 

of payment to hospitals based on rates of hospital-acquired infections.’’. 

(c) CLINICAL PRACTICE GUIDELINES.—Section 304(b) of the Medicare Improvements for Patients and Providers Act of 2008 (Public 

Law 110–275) is amended by adding at the end the following 

new paragraph: 

‘‘(4) IDENTIFICATION.— 

‘‘(A) IN GENERAL.—Following receipt of the report submitted under paragraph (2), and not less than every 3 

years thereafter, the Secretary shall contract with the 

Institute to employ the results of the study performed 

under paragraph (1) and the best methods identified by 

the Institute for the purpose of identifying existing and 

new clinical practice guidelines that were developed using 

such best methods, including guidelines listed in the 

National Guideline Clearinghouse. 

‘‘(B) CONSULTATION.—In carrying out the identification 

process under subparagraph (A), the Secretary shall allow 

for consultation with professional societies, voluntary 

health care organizations, and expert panels.’’. 

SEC. 10304. SELECTION OF EFFICIENCY MEASURES. 

Sections 1890(b)(7) and 1890A of the Social Security Act, as 

added by section 3014, are amended by striking ‘‘quality’’ each 

place it appears and inserting ‘‘quality and efficiency’’. 

SEC. 10305. DATA COLLECTION; PUBLIC REPORTING. 

Section 399II(a) of the Public Health Service Act, as added 

by section 3015, is amended to read as follows: 

‘‘(a) IN GENERAL.— 
H. R. 3590—821 

‘‘(1) ESTABLISHMENT OF STRATEGIC FRAMEWORK.—The Secretary shall establish and implement an overall strategic framework to carry out the public reporting of performance information, as described in section 399JJ. Such strategic framework 

may include methods and related timelines for implementing 

nationally consistent data collection, data aggregation, and 

analysis methods. 

‘‘(2) COLLECTION AND AGGREGATION OF DATA.—The Secretary shall collect and aggregate consistent data on quality 

and resource use measures from information systems used to 

support health care delivery, and may award grants or contracts 

for this purpose. The Secretary shall align such collection and 

aggregation efforts with the requirements and assistance 

regarding the expansion of health information technology systems, the interoperability of such technology systems, and 

related standards that are in effect on the date of enactment 

of the Patient Protection and Affordable Care Act. 

‘‘(3) SCOPE.—The Secretary shall ensure that the data 

collection, data aggregation, and analysis systems described 

in paragraph (1) involve an increasingly broad range of patient 

populations, providers, and geographic areas over time.’’. 

SEC. 10306. IMPROVEMENTS UNDER THE CENTER FOR MEDICARE AND 

MEDICAID INNOVATION. 

Section 1115A of the Social Security Act, as added by section 

3021, is amended— 

(1) in subsection (a), by inserting at the end the following 

new paragraph: 

‘‘(5) TESTING WITHIN CERTAIN GEOGRAPHIC AREAS.—For purposes of testing payment and service delivery models under 

this section, the Secretary may elect to limit testing of a model 

to certain geographic areas.’’; 

(2) in subsection (b)(2)— 

(A) in subparagraph (A)— 

(i) in the second sentence, by striking ‘‘the preceding sentence may include’’ and inserting ‘‘this 

subparagraph may include, but are not limited to,’’; 

and 

(ii) by inserting after the first sentence the following new sentence: ‘‘The Secretary shall focus on 

models expected to reduce program costs under the 

applicable title while preserving or enhancing the 

quality of care received by individuals receiving benefits under such title.’’; 

(B) in subparagraph (B), by adding at the end the 

following new clauses: 

‘‘(xix) Utilizing, in particular in entities located 

in medically underserved areas and facilities of the 

Indian Health Service (whether operated by such 

Service or by an Indian tribe or tribal organization 

(as those terms are defined in section 4 of the Indian 

Health Care Improvement Act)), telehealth services— 

‘‘(I) in treating behavioral health issues (such 

as post-traumatic stress disorder) and stroke; and 

‘‘(II) to improve the capacity of non-medical 

providers and non-specialized medical providers to 
H. R. 3590—822 

provide health services for patients with chronic 

complex conditions. 

‘‘(xx) Utilizing a diverse network of providers of 

services and suppliers to improve care coordination 

for applicable individuals described in subsection 

(a)(4)(A)(i) with 2 or more chronic conditions and a 

history of prior-year hospitalization through interventions developed under the Medicare Coordinated Care 

Demonstration Project under section 4016 of the Balanced Budget Act of 1997 (42 U.S.C. 1395b–1 note).’’; 

and 

(C) in subparagraph (C), by adding at the end the 

following new clause: 

‘‘(viii) Whether the model demonstrates effective 

linkage with other public sector or private sector 

payers.’’; 

(3) in subsection (b)(4), by adding at the end the following 

new subparagraph: 

‘‘(C) MEASURE SELECTION.—To the extent feasible, the 

Secretary shall select measures under this paragraph that 

reflect national priorities for quality improvement and 

patient-centered care consistent with the measures 

described in 1890(b)(7)(B).’’; and 

(4) in subsection (c)— 

(A) in paragraph (1)(B), by striking ‘‘care and reduce 

spending; and’’ and inserting ‘‘patient care without 

increasing spending;’’; 

(B) in paragraph (2), by striking ‘‘reduce program 

spending under applicable titles.’’ and inserting ‘‘reduce 

(or would not result in any increase in) net program 

spending under applicable titles; and’’; and 

(C) by adding at the end the following: 

‘‘(3) the Secretary determines that such expansion would 

not deny or limit the coverage or provision of benefits under 

the applicable title for applicable individuals. 

In determining which models or demonstration projects to expand 

under the preceding sentence, the Secretary shall focus on models 

and demonstration projects that improve the quality of patient 

care and reduce spending.’’. 

SEC. 10307. IMPROVEMENTS TO THE MEDICARE SHARED SAVINGS PROGRAM. 

Section 1899 of the Social Security Act, as added by section 

3022, is amended by adding at the end the following new subsections: 

‘‘(i) OPTION TO USE OTHER PAYMENT MODELS.— 

‘‘(1) IN GENERAL.—If the Secretary determines appropriate, 

the Secretary may use any of the payment models described 

in paragraph (2) or (3) for making payments under the program 

rather than the payment model described in subsection (d). 

‘‘(2) PARTIAL CAPITATION MODEL.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), a 

model described in this paragraph is a partial capitation 

model in which an ACO is at financial risk for some, 

but not all, of the items and services covered under parts 

A and B, such as at risk for some or all physicians’ services 

or all items and services under part B. The Secretary 
H. R. 3590—823 

may limit a partial capitation model to ACOs that are 

highly integrated systems of care and to ACOs capable 

of bearing risk, as determined to be appropriate by the 

Secretary. 

‘‘(B) NO ADDITIONAL PROGRAM EXPENDITURES.—Payments to an ACO for items and services under this title 

for beneficiaries for a year under the partial capitation 

model shall be established in a manner that does not 

result in spending more for such ACO for such beneficiaries 

than would otherwise be expended for such ACO for such 

beneficiaries for such year if the model were not implemented, as estimated by the Secretary. 

‘‘(3) OTHER PAYMENT MODELS.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), a 

model described in this paragraph is any payment model 

that the Secretary determines will improve the quality 

and efficiency of items and services furnished under this 

title. 

‘‘(B) NO ADDITIONAL PROGRAM EXPENDITURES.— 

Subparagraph (B) of paragraph (2) shall apply to a payment 

model under subparagraph (A) in a similar manner as 

such subparagraph (B) applies to the payment model under 

paragraph (2). 

‘‘(j) INVOLVEMENT IN PRIVATE PAYER AND OTHER THIRD PARTY

ARRANGEMENTS.—The Secretary may give preference to ACOs who 

are participating in similar arrangements with other payers. 

‘‘(k) TREATMENT OF PHYSICIAN GROUP PRACTICE DEMONSTRATION.—During the period beginning on the date of the enactment 

of this section and ending on the date the program is established, 

the Secretary may enter into an agreement with an ACO under 

the demonstration under section 1866A, subject to rebasing and 

other modifications deemed appropriate by the Secretary.’’. 

SEC. 10308. REVISIONS TO NATIONAL PILOT PROGRAM ON PAYMENT 

BUNDLING. 

(a) IN GENERAL.—Section 1866D of the Social Security Act, 

as added by section 3023, is amended— 

(1) in paragraph (a)(2)(B), in the matter preceding clause 

(i), by striking ‘‘8 conditions’’ and inserting ‘‘10 conditions’’; 

(2) by striking subsection (c)(1)(B) and inserting the following: 

‘‘(B) EXPANSION.—The Secretary may, at any point 

after January 1, 2016, expand the duration and scope of 

the pilot program, to the extent determined appropriate 

by the Secretary, if— 

‘‘(i) the Secretary determines that such expansion 

is expected to— 

‘‘(I) reduce spending under title XVIII of the 

Social Security Act without reducing the quality 

of care; or 

‘‘(II) improve the quality of care and reduce 

spending; 

‘‘(ii) the Chief Actuary of the Centers for Medicare 

& Medicaid Services certifies that such expansion 

would reduce program spending under such title XVIII; 

and 
H. R. 3590—824 

‘‘(iii) the Secretary determines that such expansion 

would not deny or limit the coverage or provision of 

benefits under this title for individuals.’’; and 

(3) by striking subsection (g) and inserting the following 

new subsection: 

‘‘(g) APPLICATION OF PILOT PROGRAM TO CONTINUING CARE HOS- PITALS.— ‘‘(1) IN GENERAL.—In conducting the pilot program, the 

Secretary shall apply the provisions of the program so as to 

separately pilot test the continuing care hospital model. 

‘‘(2) SPECIAL RULES.—In pilot testing the continuing care 

hospital model under paragraph (1), the following rules shall 

apply: 

‘‘(A) Such model shall be tested without the limitation 

to the conditions selected under subsection (a)(2)(B). 

‘‘(B) Notwithstanding subsection (a)(2)(D), an episode 

of care shall be defined as the full period that a patient 

stays in the continuing care hospital plus the first 30 

days following discharge from such hospital. 

‘‘(3) CONTINUING CARE HOSPITAL DEFINED.—In this subsection, the term ‘continuing care hospital’ means an entity 

that has demonstrated the ability to meet patient care and 

patient safety standards and that provides under common 

management the medical and rehabilitation services provided 

in inpatient rehabilitation hospitals and units (as defined in 

section 1886(d)(1)(B)(ii)), long term care hospitals (as defined 

in section 1886(d)(1)(B)(iv)(I)), and skilled nursing facilities (as 

defined in section 1819(a)) that are located in a hospital 

described in section 1886(d).’’. 

(b) TECHNICAL AMENDMENTS.— 

(1) Section 3023 is amended by striking ‘‘1886C’’ and 

inserting ‘‘1866C’’. 

(2) Title XVIII of the Social Security Act is amended by 

redesignating section 1866D, as added by section 3024, as section 1866E. 

SEC. 10309. REVISIONS TO HOSPITAL READMISSIONS REDUCTION PROGRAM. 

Section 1886(q)(1) of the Social Security Act, as added by section 

3025, in the matter preceding subparagraph (A), is amended by 

striking ‘‘the Secretary shall reduce the payments’’ and all that 

follows through ‘‘the product of’’ and inserting ‘‘the Secretary shall 

make payments (in addition to the payments described in paragraph 

(2)(A)(ii)) for such a discharge to such hospital under subsection 

(d) (or section 1814(b)(3), as the case may be) in an amount equal 

to the product of’’. 

SEC. 10310. REPEAL OF PHYSICIAN PAYMENT UPDATE. 

The provisions of, and the amendment made by, section 3101 

are repealed. 

SEC. 10311. REVISIONS TO EXTENSION OF AMBULANCE ADD-ONS. 

(a) GROUND AMBULANCE.—Section 1834(l)(13)(A) of the Social 

Security Act (42 U.S.C. 1395m(l)(13)(A)), as amended by section 

3105(a), is further amended— 

(1) in the matter preceding clause (i)— 

(A) by striking ‘‘2007, for’’ and inserting ‘‘2007, and 

for’’; and 
H. R. 3590—825 

(B) by striking ‘‘2010, and for such services furnished 

on or after April 1, 2010, and before January 1, 2011’’ 

and inserting ‘‘2011’’; and 

(2) in each of clauses (i) and (ii)— 

(A) by striking ‘‘, and on or after April 1, 2010, and 

before January 1, 2011’’ each place it appears; and 

(B) by striking ‘‘January 1, 2010’’ and inserting 

‘‘January 1, 2011’’ each place it appears. 

(b) AIR AMBULANCE.—Section 146(b)(1) of the Medicare 

Improvements for Patients and Providers Act of 2008 (Public Law 

110–275), as amended by section 3105(b), is further amended by 

striking ‘‘December 31, 2009, and during the period beginning on 

April 1, 2010, and ending on January 1, 2011’’ and inserting 

‘‘December 31, 2010’’. 

(c) SUPER RURAL AMBULANCE.—Section 1834(l)(12)(A) of the 

Social Security Act (42 U.S.C. 1395m(l)(12)(A)), as amended by 

section 3105(c), is further amended by striking ‘‘2010, and on or 

after April 1, 2010, and before January 1, 2011’’ and inserting 

‘‘2011’’. 

SEC. 10312. CERTAIN PAYMENT RULES FOR LONG-TERM CARE HOSPITAL SERVICES AND MORATORIUM ON THE ESTABLISHMENT OF CERTAIN HOSPITALS AND FACILITIES. 

(a) CERTAIN PAYMENT RULES.—Section 114(c) of the Medicare, 

Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww 

note), as amended by section 4302(a) of the American Recovery 

and Reinvestment Act (Public Law 111–5) and section 3106(a) of 

this Act, is further amended by striking ‘‘4-year period’’ each place 

it appears and inserting ‘‘5-year period’’. 

(b) MORATORIUM.—Section 114(d) of such Act (42 U.S.C. 

1395ww note), as amended by section 3106(b) of this Act, in the 

matter preceding subparagraph (A), is amended by striking ‘‘4- 

year period’’ and inserting ‘‘5-year period’’. 

SEC. 10313. REVISIONS TO THE EXTENSION FOR THE RURAL COMMUNITY HOSPITAL DEMONSTRATION PROGRAM. 

(a) IN GENERAL.—Subsection (g) of section 410A of the Medicare 

Prescription Drug, Improvement, and Modernization Act of 2003 

(Public Law 108–173; 117 Stat. 2272), as added by section 3123(a) 

of this Act, is amended to read as follows: 

‘‘(g) FIVE-YEAR EXTENSION OF DEMONSTRATION PROGRAM.— ‘‘(1) IN GENERAL.—Subject to the succeeding provisions of 

this subsection, the Secretary shall conduct the demonstration 

program under this section for an additional 5-year period 

(in this section referred to as the ‘5-year extension period’) 

that begins on the date immediately following the last day 

of the initial 5-year period under subsection (a)(5). 

‘‘(2) EXPANSION OF DEMONSTRATION STATES.—Notwithstanding subsection (a)(2), during the 5-year extension period, 

the Secretary shall expand the number of States with low 

population densities determined by the Secretary under such 

subsection to 20. In determining which States to include in 

such expansion, the Secretary shall use the same criteria and 

data that the Secretary used to determine the States under 

such subsection for purposes of the initial 5-year period. 

‘‘(3) INCREASE IN MAXIMUM NUMBER OF HOSPITALS PARTICIPATING IN THE DEMONSTRATION PROGRAM.—Notwithstanding 

subsection (a)(4), during the 5-year extension period, not more 
H. R. 3590—826 

than 30 rural community hospitals may participate in the demonstration program under this section. 

‘‘(4) HOSPITALS IN DEMONSTRATION PROGRAM ON DATE OF

ENACTMENT.—In the case of a rural community hospital that 

is participating in the demonstration program under this section as of the last day of the initial 5-year period, the Secretary— 

‘‘(A) shall provide for the continued participation of 

such rural community hospital in the demonstration program during the 5-year extension period unless the rural 

community hospital makes an election, in such form and 

manner as the Secretary may specify, to discontinue such 

participation; and 

‘‘(B) in calculating the amount of payment under subsection (b) to the rural community hospital for covered 

inpatient hospital services furnished by the hospital during 

such 5-year extension period, shall substitute, under paragraph (1)(A) of such subsection— 

‘‘(i) the reasonable costs of providing such services 

for discharges occurring in the first cost reporting 

period beginning on or after the first day of the 5- 

year extension period, for 

‘‘(ii) the reasonable costs of providing such services 

for discharges occurring in the first cost reporting 

period beginning on or after the implementation of 

the demonstration program.’’. 

(b) CONFORMING AMENDMENTS.—Subsection (a)(5) of section 

410A of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2272), as 

amended by section 3123(b) of this Act, is amended by striking 

‘‘1-year extension’’ and inserting ‘‘5-year extension’’. 

SEC. 10314. ADJUSTMENT TO LOW-VOLUME HOSPITAL PROVISION. 

Section 1886(d)(12) of the Social Security Act (42 U.S.C. 

1395ww(d)(12), as amended by section 3125, is amended— 

(1) in subparagraph (C)(i), by striking ‘‘1,500 discharges’’ 

and inserting ‘‘1,600 discharges’’; and 

(2) in subparagraph (D), by striking ‘‘1,500 discharges’’ 

and inserting ‘‘1,600 discharges’’. 

SEC. 10315. REVISIONS TO HOME HEALTH CARE PROVISIONS. 

(a) REBASING.—Section 1895(b)(3)(A)(iii) of the Social Security 

Act, as added by section 3131, is amended— 

(1) in the clause heading, by striking ‘‘2013’’ and inserting 

‘‘2014’’; 

(2) in subclause (I), by striking ‘‘2013’’ and inserting ‘‘2014’’; 

and 

(3) in subclause (II), by striking ‘‘2016’’ and inserting 

‘‘2017’’. 

(b) REVISION OF HOME HEALTH STUDY AND REPORT.—Section 

3131(d) is amended to read as follows: 

‘‘(d) STUDY AND REPORT ON THE DEVELOPMENT OF HOME

HEALTH PAYMENT REVISIONS IN ORDER TO ENSURE ACCESS TO CARE

AND PAYMENT FOR SEVERITY OF ILLNESS.— 

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

Services (in this section referred to as the ‘Secretary’) shall 

conduct a study on home health agency costs involved with 
H. R. 3590—827 

providing ongoing access to care to low-income Medicare beneficiaries or beneficiaries in medically underserved areas, and 

in treating beneficiaries with varying levels of severity of illness. In conducting the study, the Secretary may analyze items 

such as the following: 

‘‘(A) Methods to potentially revise the home health 

prospective payment system under section 1895 of the 

Social Security Act (42 U.S.C. 1395fff) to account for costs 

related to patient severity of illness or to improving beneficiary access to care, such as— 

‘‘(i) payment adjustments for services that may 

involve additional or fewer resources; 

‘‘(ii) changes to reflect resources involved with providing home health services to low-income Medicare 

beneficiaries or Medicare beneficiaries residing in 

medically underserved areas; 

‘‘(iii) ways outlier payments might be revised to 

reflect costs of treating Medicare beneficiaries with 

high levels of severity of illness; and 

‘‘(iv) other issues determined appropriate by the 

Secretary. 

‘‘(B) Operational issues involved with potential 

implementation of potential revisions to the home health 

payment system, including impacts for both home health 

agencies and administrative and systems issues for the 

Centers for Medicare & Medicaid Services, and any possible 

payment vulnerabilities associated with implementing 

potential revisions. 

‘‘(C) Whether additional research might be needed. 

‘‘(D) Other items determined appropriate by the Secretary. 

‘‘(2) CONSIDERATIONS.—In conducting the study under paragraph (1), the Secretary may consider whether patient severity 

of illness and access to care could be measured by factors, 

such as— 

‘‘(A) population density and relative patient access to 

care; 

‘‘(B) variations in service costs for providing care to 

individuals who are dually eligible under the Medicare 

and Medicaid programs; 

‘‘(C) the presence of severe or chronic diseases, which 

might be measured by multiple, discontinuous home health 

episodes; 

‘‘(D) poverty status, such as evidenced by the receipt 

of Supplemental Security Income under title XVI of the 

Social Security Act; and 

‘‘(E) other factors determined appropriate by the Secretary. 

‘‘(3) REPORT.—Not later than March 1, 2014, the Secretary 

shall submit to Congress a report on the study conducted under 

paragraph (1), together with recommendations for such legislation and administrative action as the Secretary determines 

appropriate. 

‘‘(4) CONSULTATIONS.—In conducting the study under paragraph (1), the Secretary shall consult with appropriate stakeholders, such as groups representing home health agencies 

and groups representing Medicare beneficiaries. 
H. R. 3590—828 

‘‘(5) MEDICARE DEMONSTRATION PROJECT BASED ON THE

RESULTS OF THE STUDY.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (D), taking 

into account the results of the study conducted under paragraph (1), the Secretary may, as determined appropriate, 

provide for a demonstration project to test whether making 

payment adjustments for home health services under the 

Medicare program would substantially improve access to 

care for patients with high severity levels of illness or 

for low-income or underserved Medicare beneficiaries. 

‘‘(B) WAIVING BUDGET NEUTRALITY.—The Secretary 

shall not reduce the standard prospective payment amount 

(or amounts) under section 1895 of the Social Security 

Act (42 U.S.C. 1395fff) applicable to home health services 

furnished during a period to offset any increase in payments during such period resulting from the application 

of the payment adjustments under subparagraph (A). 

‘‘(C) NO EFFECT ON SUBSEQUENT PERIODS.—A payment 

adjustment resulting from the application of subparagraph 

(A) for a period— 

‘‘(i) shall not apply to payments for home health 

services under title XVIII after such period; and 

‘‘(ii) shall not be taken into account in calculating 

the payment amounts applicable for such services after 

such period. 

‘‘(D) DURATION.—If the Secretary determines it appropriate to conduct the demonstration project under this subsection, the Secretary shall conduct the project for a four 

year period beginning not later than January 1, 2015. 

‘‘(E) FUNDING.—The Secretary shall provide for the 

transfer from the Federal Hospital Insurance Trust Fund 

under section 1817 of the Social Security Act (42 U.S.C. 

1395i) and the Federal Supplementary Medical Insurance 

Trust Fund established under section 1841 of such Act 

(42 U.S.C. 1395t), in such proportion as the Secretary 

determines appropriate, of $500,000,000 for the period of 

fiscal years 2015 through 2018. Such funds shall be made 

available for the study described in paragraph (1) and 

the design, implementation and evaluation of the demonstration described in this paragraph. Amounts available 

under this subparagraph shall be available until expended. 

‘‘(F) EVALUATION AND REPORT.—If the Secretary determines it appropriate to conduct the demonstration project 

under this subsection, the Secretary shall— 

‘‘(i) provide for an evaluation of the project; and 

‘‘(ii) submit to Congress, by a date specified by 

the Secretary, a report on the project. 

‘‘(G) ADMINISTRATION.—Chapter 35 of title 44, United 

States Code, shall not apply with respect to this subsection.’’. 

SEC. 10316. MEDICARE DSH. 

Section 1886(r)(2)(B) of the Social Security Act, as added by 

section 3133, is amended— 

(1) in clause (i)— 

(A) in the matter preceding subclause (I), by striking 

‘‘(divided by 100)’’; 
H. R. 3590—829 

(B) in subclause (I), by striking ‘‘2012’’ and inserting 

‘‘2013’’; 

(C) in subclause (II), by striking the period at the 

end and inserting a comma; and 

(D) by adding at the end the following flush matter: 

‘‘minus 1.5 percentage points.’’. 

(2) in clause (ii)— 

(A) in the matter preceding subclause (I), by striking 

‘‘(divided by 100)’’; 

(B) in subclause (I), by striking ‘‘2012’’ and inserting 

‘‘2013’’; 

(C) in subclause (II), by striking the period at the 

end and inserting a comma; and 

(D) by adding at the end the following flush matter: 

‘‘and, for each of 2018 and 2019, minus 1.5 percentage 

points.’’. 

SEC. 10317. REVISIONS TO EXTENSION OF SECTION 508 HOSPITAL 

PROVISIONS. 

Section 3137(a) is amended to read as follows: 

‘‘(a) EXTENSION.— 

‘‘(1) IN GENERAL.—Subsection (a) of section 106 of division 

B of the Tax Relief and Health Care Act of 2006 (42 U.S.C. 

1395 note), as amended by section 117 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public Law 110– 

173) and section 124 of the Medicare Improvements for Patients 

and Providers Act of 2008 (Public Law 110–275), is amended 

by striking ‘September 30, 2009’ and inserting ‘September 30, 

2010’. 

‘‘(2) SPECIAL RULE FOR FISCAL YEAR 2010.— ‘‘(A) IN GENERAL.—Subject to subparagraph (B), for 

purposes of implementation of the amendment made by 

paragraph (1), including (notwithstanding paragraph (3) 

of section 117(a) of the Medicare, Medicaid and SCHIP 

Extension Act of 2007 (Public Law 110–173), as amended 

by section 124(b) of the Medicare Improvements for 

Patients and Providers Act of 2008 (Public Law 110–275)) 

for purposes of the implementation of paragraph (2) of 

such section 117(a), during fiscal year 2010, the Secretary 

of Health and Human Services (in this subsection referred 

to as the ‘Secretary’) shall use the hospital wage index 

that was promulgated by the Secretary in the Federal 

Register on August 27, 2009 (74 Fed. Reg. 43754), and 

any subsequent corrections. 

‘‘(B) EXCEPTION.—Beginning on April 1, 2010, in determining the wage index applicable to hospitals that qualify 

for wage index reclassification, the Secretary shall include 

the average hourly wage data of hospitals whose reclassification was extended pursuant to the amendment made 

by paragraph (1) only if including such data results in 

a higher applicable reclassified wage index. 

‘‘(3) ADJUSTMENT FOR CERTAIN HOSPITALS IN FISCAL YEAR

2010.— 

‘‘(A) IN GENERAL.—In the case of a subsection (d) hospital (as defined in subsection (d)(1)(B) of section 1886 

of the Social Security Act (42 U.S.C. 1395ww)) with respect 

to which— 
H. R. 3590—830 

‘‘(i) a reclassification of its wage index for purposes 

of such section was extended pursuant to the amendment made by paragraph (1); and 

‘‘(ii) the wage index applicable for such hospital 

for the period beginning on October 1, 2009, and ending 

on March 31, 2010, was lower than for the period 

beginning on April 1, 2010, and ending on September 

30, 2010, by reason of the application of paragraph 

(2)(B); 

the Secretary shall pay such hospital an additional payment that reflects the difference between the wage index 

for such periods. 

‘‘(B) TIMEFRAME FOR PAYMENTS.—The Secretary shall 

make payments required under subparagraph by not later 

than December 31, 2010.’’. 

SEC. 10318. REVISIONS TO TRANSITIONAL EXTRA BENEFITS UNDER 

MEDICARE ADVANTAGE. 

Section 1853(p)(3)(A) of the Social Security Act, as added by 

section 3201(h), is amended by inserting ‘‘in 2009’’ before the period 

at the end. 

SEC. 10319. REVISIONS TO MARKET BASKET ADJUSTMENTS. 

(a) INPATIENT ACUTE HOSPITALS.—Section 1886(b)(3)(B)(xii) of 

the Social Security Act, as added by section 3401(a), is amended— 

(1) in subclause (I), by striking ‘‘and’’ at the end; 

(2) by redesignating subclause (II) as subclause (III); 

(3) by inserting after subclause (II) the following new subclause: 

‘‘(II) for each of fiscal years 2012 and 2013, by 0.1 percentage point; and’’; and 

(4) in subclause (III), as redesignated by paragraph (2), 

by striking ‘‘2012’’ and inserting ‘‘2014’’. 

(b) LONG-TERM CARE HOSPITALS.—Section 1886(m)(4) of the 

Social Security Act, as added by section 3401(c), is amended— 

(1) in subparagraph (A)— 

(A) in clause (i)— 

(i) by striking ‘‘each of rate years 2010 and 2011’’ 

and inserting ‘‘rate year 2010’’; and 

(ii) by striking ‘‘and’’ at the end; 

(B) by redesignating clause (ii) as clause (iv); 

(C) by inserting after clause (i) the following new 

clauses: 

‘‘(ii) for rate year 2011, 0.50 percentage point; 

‘‘(iii) for each of the rate years beginning in 2012 

and 2013, 0.1 percentage point; and’’; and 

(D) in clause (iv), as redesignated by subparagraph 

(B), by striking ‘‘2012’’ and inserting ‘‘2014’’; and 

(2) in subparagraph (B), by striking ‘‘(A)(ii)’’ and inserting 

‘‘(A)(iv)’’. 

(c) INPATIENT REHABILITATION FACILITIES.—Section 

1886(j)(3)(D)(i) of the Social Security Act, as added by section 

3401(d), is amended— 

(1) in subclause (I), by striking ‘‘and’’ at the end; 

(2) by redesignating subclause (II) as subclause (III); 

(3) by inserting after subclause (II) the following new subclause: 
H. R. 3590—831 

‘‘(II) for each of fiscal years 2012 and 2013, 

0.1 percentage point; and’’; and 

(4) in subclause (III), as redesignated by paragraph (2), 

by striking ‘‘2012’’ and inserting ‘‘2014’’. 

(d) HOME HEALTH AGENCIES.—Section 1895(b)(3)(B)(vi)(II) of 

such Act, as added by section 3401(e), is amended by striking 

‘‘and 2012’’ and inserting ‘‘, 2012, and 2013’’. 

(e) PSYCHIATRIC HOSPITALS.—Section 1886(s)(3)(A) of the Social 

Security Act, as added by section 3401(f), is amended— 

(1) in clause (i), by striking ‘‘and’’ at the end; 

(2) by redesignating clause (ii) as clause (iii); 

(3) by inserting after clause (ii) the following new clause: 

‘‘(ii) for each of the rate years beginning in 2012 

and 2013, 0.1 percentage point; and’’; and 

(4) in clause (iii), as redesignated by paragraph (2), by 

striking ‘‘2012’’ and inserting ‘‘2014’’. 

(f) HOSPICE CARE.—Section 1814(i)(1)(C) of the Social Security 

Act (42 U.S.C. 1395f(i)(1)(C)), as amended by section 3401(g), is 

amended— 

(1) in clause (iv)(II), by striking ‘‘0.5’’ and inserting ‘‘0.3’’; 

and 

(2) in clause (v), in the matter preceding subclause (I), 

by striking ‘‘0.5’’ and inserting ‘‘0.3’’. 

(g) OUTPATIENT HOSPITALS.—Section 1833(t)(3)(G)(i) of the 

Social Security Act, as added by section 3401(i), is amended— 

(1) in subclause (I), by striking ‘‘and’’ at the end; 

(2) by redesignating subclause (II) as subclause (III); 

(3) by inserting after subclause (II) the following new subclause: 

‘‘(II) for each of 2012 and 2013, 0.1 percentage 

point; and’’; and 

(4) in subclause (III), as redesignated by paragraph (2), 

by striking ‘‘2012’’ and inserting ‘‘2014’’. 

SEC. 10320. EXPANSION OF THE SCOPE OF, AND ADDITIONAL IMPROVEMENTS TO, THE INDEPENDENT MEDICARE ADVISORY 

BOARD. 

(a) IN GENERAL.—Section 1899A of the Social Security Act, 

as added by section 3403, is amended— 

(1) in subsection (c)— 

(A) in paragraph (1)(B), by adding at the end the 

following new sentence: ‘‘In any year (beginning with 2014) 

that the Board is not required to submit a proposal under 

this section, the Board shall submit to Congress an advisory 

report on matters related to the Medicare program.’’; 

(B) in paragraph (2)(A)— 

(i) in clause (iv), by inserting ‘‘or the full premium 

subsidy under section 1860D–14(a)’’ before the period 

at the end of the last sentence; and 

(ii) by adding at the end the following new clause: 

‘‘(vii) If the Chief Actuary of the Centers for Medicare & Medicaid Services has made a determination 

described in subsection (e)(3)(B)(i)(II) in the determination year, the proposal shall be designed to help reduce 

the growth rate described in paragraph (8) while 

maintaining or enhancing beneficiary access to quality 

care under this title.’’; 
H. R. 3590—832 

(C) in paragraph (2)(B)— 

(i) in clause (v), by striking ‘‘and’’ at the end; 

(ii) in clause (vi), by striking the period at the 

end and inserting ‘‘; and’’; and 

(iii) by adding at the end the following new clause: 

‘‘(vii) take into account the data and findings contained in the annual reports under subsection (n) in 

order to develop proposals that can most effectively 

promote the delivery of efficient, high quality care to 

Medicare beneficiaries.’’; 

(D) in paragraph (3)— 

(i) in the heading, by striking ‘‘TRANSMISSION OF

BOARD PROPOSAL TO PRESIDENT’’ and inserting ‘‘SUBMISSION OF BOARD PROPOSAL TO CONGRESS AND THE PRESIDENT’’; 

(ii) in subparagraph (A)(i), by striking ‘‘transmit 

a proposal under this section to the President’’ and 

insert ‘‘submit a proposal under this section to Congress and the President’’; and 

(iii) in subparagraph (A)(ii)— 

(I) in subclause (I), by inserting ‘‘or’’ at the 

end; 

(II) in subclause (II), by striking ‘‘; or’’ and 

inserting a period; and 

(III) by striking subclause (III); 

(E) in paragraph (4)— 

(i) by striking ‘‘the Board under paragraph (3)(A)(i) 

or’’; and 

(ii) by striking ‘‘immediately’’ and inserting ‘‘within 

2 days’’; 

(F) in paragraph (5)— 

(i) by striking ‘‘to but’’ and inserting ‘‘but’’; and 

(ii) by inserting ‘‘Congress and’’ after ‘‘submit a 

proposal to’’; and 

(G) in paragraph (6)(B)(i), by striking ‘‘per unduplicated 

enrollee’’ and inserting ‘‘(calculated as the sum of per capita 

spending under each of parts A, B, and D)’’; 

(2) in subsection (d)— 

(A) in paragraph (1)(A)— 

(i) by inserting ‘‘the Board or’’ after ‘‘a proposal 

is submitted by’’; and 

(ii) by inserting ‘‘subsection (c)(3)(A)(i) or’’ after 

‘‘the Senate under’’; and 

(B) in paragraph (2)(A), by inserting ‘‘the Board or’’ 

after ‘‘a proposal is submitted by’’; 

(3) in subsection (e)— 

(A) in paragraph (1), by inserting ‘‘the Board or’’ after 

‘‘a proposal submitted by’’; and 

(B) in paragraph (3)— 

(i) by striking ‘‘EXCEPTION.—The Secretary shall 

not be required to implement the recommendations 

contained in a proposal submitted in a proposal year 

by’’ and inserting ‘‘EXCEPTIONS.— 

‘‘(A) IN GENERAL.—The Secretary shall not implement 

the recommendations contained in a proposal submitted 

in a proposal year by the Board or’’; 
H. R. 3590—833 

(ii) by redesignating subparagraphs (A) and (B) 

as clauses (i) and (ii), respectively, and indenting 

appropriately; and 

(iii) by adding at the end the following new 

subparagraph: 

‘‘(B) LIMITED ADDITIONAL EXCEPTION.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), the Secretary shall not implement the recommendations contained in a proposal submitted by the Board or the 

President to Congress pursuant to this section in a 

proposal year (beginning with proposal year 2019) if— 

‘‘(I) the Board was required to submit a proposal to Congress under this section in the year 

preceding the proposal year; and 

‘‘(II) the Chief Actuary of the Centers for Medicare & Medicaid Services makes a determination 

in the determination year that the growth rate 

described in subsection (c)(8) exceeds the growth 

rate described in subsection (c)(6)(A)(i). 

‘‘(ii) LIMITED ADDITIONAL EXCEPTION MAY NOT BE

APPLIED IN TWO CONSECUTIVE YEARS.—This subparagraph shall not apply if the recommendations contained 

in a proposal submitted by the Board or the President 

to Congress pursuant to this section in the year preceding the proposal year were not required to be implemented by reason of this subparagraph. 

‘‘(iii) NO AFFECT ON REQUIREMENT TO SUBMIT PRO- POSALS OR FOR CONGRESSIONAL CONSIDERATION OF PROPOSALS.—Clause (i) and (ii) shall not affect— 

‘‘(I) the requirement of the Board or the President to submit a proposal to Congress in a proposal 

year in accordance with the provisions of this section; or 

‘‘(II) Congressional consideration of a legislative proposal (described in subsection (c)(3)(B)(iv)) 

contained such a proposal in accordance with subsection (d).’’; 

(4) in subsection (f)(3)(B)— 

(A) by striking ‘‘or advisory reports to Congress’’ and 

inserting ‘‘, advisory reports, or advisory recommendations’’; 

and 

(B) by inserting ‘‘or produce the public report under 

subsection (n)’’ after ‘‘this section’’; and 

(5) by adding at the end the following new subsections: 

‘‘(n) ANNUAL PUBLIC REPORT.— 

‘‘(1) IN GENERAL.—Not later than July 1, 2014, and 

annually thereafter, the Board shall produce a public report 

containing standardized information on system-wide health 

care costs, patient access to care, utilization, and quality-ofcare that allows for comparison by region, types of services, 

types of providers, and both private payers and the program 

under this title. 

‘‘(2) REQUIREMENTS.—Each report produced pursuant to 

paragraph (1) shall include information with respect to the 

following areas: 

‘‘(A) The quality and costs of care for the population 

at the most local level determined practical by the Board 
H. R. 3590—834 

(with quality and costs compared to national benchmarks 

and reflecting rates of change, taking into account quality 

measures described in section 1890(b)(7)(B)). 

‘‘(B) Beneficiary and consumer access to care, patient 

and caregiver experience of care, and the cost-sharing or 

out-of-pocket burden on patients. 

‘‘(C) Epidemiological shifts and demographic changes. 

‘‘(D) The proliferation, effectiveness, and utilization of 

health care technologies, including variation in provider 

practice patterns and costs. 

‘‘(E) Any other areas that the Board determines affect 

overall spending and quality of care in the private sector. 

‘‘(o) ADVISORY RECOMMENDATIONS FOR NON-FEDERAL HEALTH

CARE PROGRAMS.— ‘‘(1) IN GENERAL.—Not later than January 15, 2015, and 

at least once every two years thereafter, the Board shall submit 

to Congress and the President recommendations to slow the 

growth in national health expenditures (excluding expenditures 

under this title and in other Federal health care programs) 

while preserving or enhancing quality of care, such as recommendations— 

‘‘(A) that the Secretary or other Federal agencies can 

implement administratively; 

‘‘(B) that may require legislation to be enacted by Congress in order to be implemented; 

‘‘(C) that may require legislation to be enacted by State 

or local governments in order to be implemented; 

‘‘(D) that private sector entities can voluntarily implement; and 

‘‘(E) with respect to other areas determined appropriate 

by the Board. 

‘‘(2) COORDINATION.—In making recommendations under 

paragraph (1), the Board shall coordinate such recommendations with recommendations contained in proposals and 

advisory reports produced by the Board under subsection (c). 

‘‘(3) AVAILABLE TO PUBLIC.—The Board shall make recommendations submitted to Congress and the President under 

this subsection available to the public.’’. 

(b) NAME CHANGE.—Any reference in the provisions of, or 

amendments made by, section 3403 to the ‘‘Independent Medicare 

Advisory Board’’ shall be deemed to be a reference to the ‘‘Independent Payment Advisory Board’’. 

(c) RULE OF CONSTRUCTION.—Nothing in the amendments made 

by this section shall preclude the Independent Medicare Advisory 

Board, as established under section 1899A of the Social Security 

Act (as added by section 3403), from solely using data from public 

or private sources to carry out the amendments made by subsection 

(a)(4). 

SEC. 10321. REVISION TO COMMUNITY HEALTH TEAMS. 

Section 3502(c)(2)(A) is amended by inserting ‘‘or other primary 

care providers’’ after ‘‘physicians’’. 

SEC. 10322. QUALITY REPORTING FOR PSYCHIATRIC HOSPITALS. 

(a) IN GENERAL.—Section 1886(s) of the Social Security Act, 

as added by section 3401(f), is amended by adding at the end 

the following new paragraph: 

‘‘(4) QUALITY REPORTING.— 
H. R. 3590—835 

‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 

‘‘(i) IN GENERAL.—Under the system described in 

paragraph (1), for rate year 2014 and each subsequent 

rate year, in the case of a psychiatric hospital or psychiatric unit that does not submit data to the Secretary 

in accordance with subparagraph (C) with respect to 

such a rate year, any annual update to a standard 

Federal rate for discharges for the hospital during 

the rate year, and after application of paragraph (2), 

shall be reduced by 2 percentage points. 

‘‘(ii) SPECIAL RULE.—The application of this 

subparagraph may result in such annual update being 

less than 0.0 for a rate year, and may result in payment 

rates under the system described in paragraph (1) 

for a rate year being less than such payment rates 

for the preceding rate year. 

‘‘(B) NONCUMULATIVE APPLICATION.—Any reduction 

under subparagraph (A) shall apply only with respect to 

the rate year involved and the Secretary shall not take 

into account such reduction in computing the payment 

amount under the system described in paragraph (1) for 

a subsequent rate year. 

‘‘(C) SUBMISSION OF QUALITY DATA.—For rate year 2014 

and each subsequent rate year, each psychiatric hospital 

and psychiatric unit shall submit to the Secretary data 

on quality measures specified under subparagraph (D). 

Such data shall be submitted in a form and manner, and 

at a time, specified by the Secretary for purposes of this 

subparagraph. 

‘‘(D) QUALITY MEASURES.— 

‘‘(i) IN GENERAL.—Subject to clause (ii), any 

measure specified by the Secretary under this subparagraph must have been endorsed by the entity with 

a contract under section 1890(a). 

‘‘(ii) EXCEPTION.—In the case of a specified area 

or medical topic determined appropriate by the Secretary for which a feasible and practical measure has 

not been endorsed by the entity with a contract under 

section 1890(a), the Secretary may specify a measure 

that is not so endorsed as long as due consideration 

is given to measures that have been endorsed or 

adopted by a consensus organization identified by the 

Secretary. 

‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 

the Secretary shall publish the measures selected 

under this subparagraph that will be applicable with 

respect to rate year 2014. 

‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 

Secretary shall establish procedures for making data submitted under subparagraph (C) available to the public. 

Such procedures shall ensure that a psychiatric hospital 

and a psychiatric unit has the opportunity to review the 

data that is to be made public with respect to the hospital 

or unit prior to such data being made public. The Secretary 

shall report quality measures that relate to services furnished in inpatient settings in psychiatric hospitals and 
H. R. 3590—836 

psychiatric units on the Internet website of the Centers 

for Medicare & Medicaid Services.’’. 

(b) CONFORMING AMENDMENT.—Section 1890(b)(7)(B)(i)(I) of the 

Social Security Act, as added by section 3014, is amended by 

inserting ‘‘1886(s)(4)(D),’’ after ‘‘1886(o)(2),’’. 

SEC. 10323. MEDICARE COVERAGE FOR INDIVIDUALS EXPOSED TO 

ENVIRONMENTAL HEALTH HAZARDS. 

(a) IN GENERAL.—Title XVIII of the Social Security Act (42 

U.S.C. 1395 et seq.) is amended by inserting after section 1881 

the following new section: 

‘‘SEC. 1881A. MEDICARE COVERAGE FOR INDIVIDUALS EXPOSED TO 

ENVIRONMENTAL HEALTH HAZARDS. 

‘‘(a) DEEMING OF INDIVIDUALS AS ELIGIBLE FOR MEDICARE BENE- FITS.— ‘‘(1) IN GENERAL.—For purposes of eligibility for benefits 

under this title, an individual determined under subsection 

(c) to be an environmental exposure affected individual 

described in subsection (e)(2) shall be deemed to meet the 

conditions specified in section 226(a). 

‘‘(2) DISCRETIONARY DEEMING.—For purposes of eligibility 

for benefits under this title, the Secretary may deem an individual determined under subsection (c) to be an environmental 

exposure affected individual described in subsection (e)(3) to 

meet the conditions specified in section 226(a). 

‘‘(3) EFFECTIVE DATE OF COVERAGE.—An Individual who 

is deemed eligible for benefits under this title under paragraph 

(1) or (2) shall be— 

‘‘(A) entitled to benefits under the program under Part 

A as of the date of such deeming; and 

‘‘(B) eligible to enroll in the program under Part B 

beginning with the month in which such deeming occurs. 

‘‘(b) PILOT PROGRAM FOR CARE OF CERTAIN INDIVIDUALS

RESIDING IN EMERGENCY DECLARATION AREAS.— ‘‘(1) PROGRAM; PURPOSE.— ‘‘(A) PRIMARY PILOT PROGRAM.—The Secretary shall 

establish a pilot program in accordance with this subsection 

to provide innovative approaches to furnishing comprehensive, coordinated, and cost-effective care under this title 

to individuals described in paragraph (2)(A). 

‘‘(B) OPTIONAL PILOT PROGRAMS.—The Secretary may 

establish a separate pilot program, in accordance with this 

subsection, with respect to each geographic area subject 

to an emergency declaration (other than the declaration 

of June 17, 2009), in order to furnish such comprehensive, 

coordinated and cost-effective care to individuals described 

in subparagraph (2)(B) who reside in each such area. 

‘‘(2) INDIVIDUAL DESCRIBED.—For purposes of paragraph 

(1), an individual described in this paragraph is an individual 

who enrolls in part B, submits to the Secretary an application 

to participate in the applicable pilot program under this subsection, and— 

‘‘(A) is an environmental exposure affected individual 

described in subsection (e)(2) who resides in or around 

the geographic area subject to an emergency declaration 

made as of June 17, 2009; or 
H. R. 3590—837 

‘‘(B) is an environmental exposure affected individual 

described in subsection (e)(3) who— 

‘‘(i) is deemed under subsection (a)(2); and 

‘‘(ii) meets such other criteria or conditions for 

participation in a pilot program under paragraph (1)(B) 

as the Secretary specifies. 

‘‘(3) FLEXIBLE BENEFITS AND SERVICES.—A pilot program 

under this subsection may provide for the furnishing of benefits, 

items, or services not otherwise covered or authorized under 

this title, if the Secretary determines that furnishing such 

benefits, items, or services will further the purposes of such 

pilot program (as described in paragraph (1)). 

‘‘(4) INNOVATIVE REIMBURSEMENT METHODOLOGIES.—For 

purposes of the pilot program under this subsection, the Secretary— 

‘‘(A) shall develop and implement appropriate methodologies to reimburse providers for furnishing benefits, 

items, or services for which payment is not otherwise covered or authorized under this title, if such benefits, items, 

or services are furnished pursuant to paragraph (3); and 

‘‘(B) may develop and implement innovative approaches 

to reimbursing providers for any benefits, items, or services 

furnished under this subsection. 

‘‘(5) LIMITATION.—Consistent with section 1862(b), no payment shall be made under the pilot program under this subsection with respect to benefits, items, or services furnished 

to an environmental exposure affected individual (as defined 

in subsection (e)) to the extent that such individual is eligible 

to receive such benefits, items, or services through any other 

public or private benefits plan or legal agreement. 

‘‘(6) WAIVER AUTHORITY.—The Secretary may waive such 

provisions of this title and title XI as are necessary to carry 

out pilot programs under this subsection. 

‘‘(7) FUNDING.—For purposes of carrying out pilot programs 

under this subsection, the Secretary shall provide for the 

transfer, from the Federal Hospital Insurance Trust Fund under 

section 1817 and the Federal Supplementary Medical Insurance 

Trust Fund under section 1841, in such proportion as the 

Secretary determines appropriate, of such sums as the Secretary determines necessary, to the Centers for Medicare & 

Medicaid Services Program Management Account. 

‘‘(8) WAIVER OF BUDGET NEUTRALITY.—The Secretary shall 

not require that pilot programs under this subsection be budget 

neutral with respect to expenditures under this title. 

‘‘(c) DETERMINATIONS.— 

‘‘(1) BY THE COMMISSIONER OF SOCIAL SECURITY.—For purposes of this section, the Commissioner of Social Security, in 

consultation with the Secretary, and using the cost allocation 

method prescribed in section 201(g), shall determine whether 

individuals are environmental exposure affected individuals. 

‘‘(2) BY THE SECRETARY.—The Secretary shall determine 

eligibility for pilot programs under subsection (b). 

‘‘(d) EMERGENCY DECLARATION DEFINED.—For purposes of this 

section, the term ‘emergency declaration’ means a declaration of 

a public health emergency under section 104(a) of the Comprehensive Environmental Response, Compensation, and Liability Act of 

1980. 
H. R. 3590—838 

‘‘(e) ENVIRONMENTAL EXPOSURE AFFECTED INDIVIDUAL

DEFINED.— 

‘‘(1) IN GENERAL.—For purposes of this section, the term 

‘environmental exposure affected individual’ means— 

‘‘(A) an individual described in paragraph (2); and 

‘‘(B) an individual described in paragraph (3). 

‘‘(2) INDIVIDUAL DESCRIBED.— 

‘‘(A) IN GENERAL.—An individual described in this paragraph is any individual who— 

‘‘(i) is diagnosed with 1 or more conditions 

described in subparagraph (B); 

‘‘(ii) as demonstrated in such manner as the Secretary determines appropriate, has been present for 

an aggregate total of 6 months in the geographic area 

subject to an emergency declaration specified in subsection (b)(2)(A), during a period ending— 

‘‘(I) not less than 10 years prior to such diagnosis; and 

‘‘(II) prior to the implementation of all the 

remedial and removal actions specified in the 

Record of Decision for Operating Unit 4 and the 

Record of Decision for Operating Unit 7; 

‘‘(iii) files an application for benefits under this 

title (or has an application filed on behalf of the individual), including pursuant to this section; and 

‘‘(iv) is determined under this section to meet the 

criteria in this subparagraph. 

‘‘(B) CONDITIONS DESCRIBED.—For purposes of subparagraph (A), the following conditions are described in this 

subparagraph: 

‘‘(i) Asbestosis, pleural thickening, or pleural 

plaques as established by— 

‘‘(I) interpretation by a ‘B Reader’ qualified 

physician of a plain chest x-ray or interpretation 

of a computed tomographic radiograph of the chest 

by a qualified physician, as determined by the 

Secretary; or 

‘‘(II) such other diagnostic standards as the 

Secretary specifies, 

except that this clause shall not apply to pleural thickening or pleural plaques unless there are symptoms 

or conditions requiring medical treatment as a result 

of these diagnoses. 

‘‘(ii) Mesothelioma, or malignancies of the lung, 

colon, rectum, larynx, stomach, esophagus, pharynx, 

or ovary, as established by— 

‘‘(I) pathologic examination of biopsy tissue; 

‘‘(II) cytology from bronchioalveolar lavage; or 

‘‘(III) such other diagnostic standards as the 

Secretary specifies. 

‘‘(iii) Any other diagnosis which the Secretary, in 

consultation with the Commissioner of Social Security, 

determines is an asbestos-related medical condition, 

as established by such diagnostic standards as the 

Secretary specifies. 

‘‘(3) OTHER INDIVIDUAL DESCRIBED.—An individual 

described in this paragraph is any individual who— 
H. R. 3590—839 

‘‘(A) is not an individual described in paragraph (2); 

‘‘(B) is diagnosed with a medical condition caused by 

the exposure of the individual to a public health hazard 

to which an emergency declaration applies, based on such 

medical conditions, diagnostic standards, and other criteria 

as the Secretary specifies; 

‘‘(C) as demonstrated in such manner as the Secretary 

determines appropriate, has been present for an aggregate 

total of 6 months in the geographic area subject to the 

emergency declaration involved, during a period determined appropriate by the Secretary; 

‘‘(D) files an application for benefits under this title 

(or has an application filed on behalf of the individual), 

including pursuant to this section; and 

‘‘(E) is determined under this section to meet the criteria in this paragraph.’’. 

(b) PROGRAM FOR EARLY DETECTION OF CERTAIN MEDICAL

CONDITIONS RELATED TO ENVIRONMENTAL HEALTH HAZARDS.—Title 

XX of the Social Security Act (42 U.S.C. 1397 et seq.), as amended 

by section 5507, is amended by adding at the end the following: 

‘‘SEC. 2009. PROGRAM FOR EARLY DETECTION OF CERTAIN MEDICAL 

CONDITIONS RELATED TO ENVIRONMENTAL HEALTH 

HAZARDS. 

‘‘(a) PROGRAM ESTABLISHMENT.—The Secretary shall establish 

a program in accordance with this section to make competitive 

grants to eligible entities specified in subsection (b) for the purpose 

of— 

‘‘(1) screening at-risk individuals (as defined in subsection 

(c)(1)) for environmental health conditions (as defined in subsection (c)(3)); and 

‘‘(2) developing and disseminating public information and 

education concerning— 

‘‘(A) the availability of screening under the program 

under this section; 

‘‘(B) the detection, prevention, and treatment of 

environmental health conditions; and 

‘‘(C) the availability of Medicare benefits for certain 

individuals diagnosed with environmental health conditions 

under section 1881A. 

‘‘(b) ELIGIBLE ENTITIES.— 

‘‘(1) IN GENERAL.—For purposes of this section, an eligible 

entity is an entity described in paragraph (2) which submits 

an application to the Secretary in such form and manner, 

and containing such information and assurances, as the Secretary determines appropriate. 

‘‘(2) TYPES OF ELIGIBLE ENTITIES.—The entities described 

in this paragraph are the following: 

‘‘(A) A hospital or community health center. 

‘‘(B) A Federally qualified health center. 

‘‘(C) A facility of the Indian Health Service. 

‘‘(D) A National Cancer Institute-designated cancer 

center. 

‘‘(E) An agency of any State or local government. 

‘‘(F) A nonprofit organization. 

‘‘(G) Any other entity the Secretary determines appropriate. 
H. R. 3590—840 

‘‘(c) DEFINITIONS.—In this section: 

‘‘(1) AT-RISK INDIVIDUAL.—The term ‘at-risk individual’ 

means an individual who— 

‘‘(A)(i) as demonstrated in such manner as the Secretary determines appropriate, has been present for an 

aggregate total of 6 months in the geographic area subject 

to an emergency declaration specified under paragraph (2), 

during a period ending— 

‘‘(I) not less than 10 years prior to the date of 

such individual’s application under subparagraph (B); 

and 

‘‘(II) prior to the implementation of all the remedial 

and removal actions specified in the Record of Decision 

for Operating Unit 4 and the Record of Decision for 

Operating Unit 7; or 

‘‘(ii) meets such other criteria as the Secretary determines appropriate considering the type of environmental 

health condition at issue; and 

‘‘(B) has submitted an application (or has an application submitted on the individual’s behalf), to an eligible 

entity receiving a grant under this section, for screening 

under the program under this section. 

‘‘(2) EMERGENCY DECLARATION.—The term ‘emergency declaration’ means a declaration of a public health emergency 

under section 104(a) of the Comprehensive Environmental 

Response, Compensation, and Liability Act of 1980. 

‘‘(3) ENVIRONMENTAL HEALTH CONDITION.—The term 

‘environmental health condition’ means— 

‘‘(A) asbestosis, pleural thickening, or pleural plaques, 

as established by— 

‘‘(i) interpretation by a ‘B Reader’ qualified physician of a plain chest x-ray or interpretation of a computed tomographic radiograph of the chest by a qualified physician, as determined by the Secretary; or 

‘‘(ii) such other diagnostic standards as the Secretary specifies; 

‘‘(B) mesothelioma, or malignancies of the lung, colon, 

rectum, larynx, stomach, esophagus, pharynx, or ovary, 

as established by— 

‘‘(i) pathologic examination of biopsy tissue; 

‘‘(ii) cytology from bronchioalveolar lavage; or 

‘‘(iii) such other diagnostic standards as the Secretary specifies; and 

‘‘(C) any other medical condition which the Secretary 

determines is caused by exposure to a hazardous substance 

or pollutant or contaminant at a Superfund site to which 

an emergency declaration applies, based on such criteria 

and as established by such diagnostic standards as the 

Secretary specifies. 

‘‘(4) HAZARDOUS SUBSTANCE; POLLUTANT; CONTAMINANT.— 

The terms ‘hazardous substance’, ‘pollutant’, and ‘contaminant’ 

have the meanings given those terms in section 101 of the 

Comprehensive Environmental Response, Compensation, and 

Liability Act of 1980 (42 U.S.C. 9601). 

‘‘(5) SUPERFUND SITE.—The term ‘Superfund site’ means 

a site included on the National Priorities List developed by 

the President in accordance with section 105(a)(8)(B) of the 
H. R. 3590—841 

Comprehensive Environmental Response, Compensation, and 

Liability Act of 1980 (42 U.S.C. 9605(a)(8)(B)). 

‘‘(d) HEALTH COVERAGE UNAFFECTED.—Nothing in this section 

shall be construed to affect any coverage obligation of a governmental or private health plan or program relating to an at-risk 

individual. 

‘‘(e) FUNDING.— 

‘‘(1) IN GENERAL.—Out of any funds in the Treasury not 

otherwise appropriated, there are appropriated to the Secretary, 

to carry out the program under this section— 

‘‘(A) $23,000,000 for the period of fiscal years 2010 

through 2014; and 

‘‘(B) $20,000,000 for each 5-fiscal year period thereafter. 

‘‘(2) AVAILABILITY.—Funds appropriated under paragraph 

(1) shall remain available until expended. 

‘‘(f) NONAPPLICATION.— 

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 

the preceding sections of this title shall not apply to grants 

awarded under this section. 

‘‘(2) LIMITATIONS ON USE OF GRANTS.—Section 2005(a) shall 

apply to a grant awarded under this section to the same extent 

and in the same manner as such section applies to payments 

to States under this title, except that paragraph (4) of such 

section shall not be construed to prohibit grantees from conducting screening for environmental health conditions as 

authorized under this section.’’. 

SEC. 10324. PROTECTIONS FOR FRONTIER STATES. 

(a) FLOOR ON AREA WAGE INDEX FOR HOSPITALS IN FRONTIER

STATES.— 

(1) IN GENERAL.—Section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended— 

(A) in clause (i), by striking ‘‘clause (ii)’’ and inserting 

‘‘clause (ii) or (iii)’’; and 

(B) by adding at the end the following new clause: 

‘‘(iii) FLOOR ON AREA WAGE INDEX FOR HOSPITALS

IN FRONTIER STATES.— 

‘‘(I) IN GENERAL.—Subject to subclause (IV), 

for discharges occurring on or after October 1, 

2010, the area wage index applicable under this 

subparagraph to any hospital which is located in 

a frontier State (as defined in subclause (II)) may 

not be less than 1.00. 

‘‘(II) FRONTIER STATE DEFINED.—In this clause, 

the term ‘frontier State’ means a State in which 

at least 50 percent of the counties in the State 

are frontier counties. 

‘‘(III) FRONTIER COUNTY DEFINED.—In this 

clause, the term ‘frontier county’ means a county 

in which the population per square mile is less 

than 6. 

‘‘(IV) LIMITATION.—This clause shall not apply 

to any hospital located in a State that receives 

a non-labor related share adjustment under paragraph (5)(H).’’. 
H. R. 3590—842 

(2) WAIVING BUDGET NEUTRALITY.—Section 1886(d)(3)(E) of 

the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)), as amended 

by subsection (a), is amended in the third sentence by inserting 

‘‘and the amendments made by section 10324(a)(1) of the 

Patient Protection and Affordable Care Act’’ after ‘‘2003’’. 

(b) FLOOR ON AREA WAGE ADJUSTMENT FACTOR FOR HOSPITAL

OUTPATIENT DEPARTMENT SERVICES IN FRONTIER STATES.—Section 

1833(t) of the Social Security Act (42 U.S.C. 1395l(t)), as amended 

by section 3138, is amended— 

(1) in paragraph (2)(D), by striking ‘‘the Secretary’’ and 

inserting ‘‘subject to paragraph (19), the Secretary’’; and 

(2) by adding at the end the following new paragraph: 

‘‘(19) FLOOR ON AREA WAGE ADJUSTMENT FACTOR FOR HOSPITAL OUTPATIENT DEPARTMENT SERVICES IN FRONTIER STATES.— 

‘‘(A) IN GENERAL.—Subject to subparagraph (B), with 

respect to covered OPD services furnished on or after 

January 1, 2011, the area wage adjustment factor 

applicable under the payment system established under 

this subsection to any hospital outpatient department 

which is located in a frontier State (as defined in section 

1886(d)(3)(E)(iii)(II)) may not be less than 1.00. The preceding sentence shall not be applied in a budget neutral 

manner. 

‘‘(B) LIMITATION.—This paragraph shall not apply to 

any hospital outpatient department located in a State that 

receives a non-labor related share adjustment under section 

1886(d)(5)(H).’’. 

(c) FLOOR FOR PRACTICE EXPENSE INDEX FOR PHYSICIANS’ SERVICES FURNISHED IN FRONTIER STATES.—Section 1848(e)(1) of the 

Social Security Act (42 U.S.C. 1395w–4(e)(1)), as amended by section 

3102, is amended— 

(1) in subparagraph (A), by striking ‘‘and (H)’’ and inserting 

‘‘(H), and (I)’’; and 

(2) by adding at the end the following new subparagraph: 

‘‘(I) FLOOR FOR PRACTICE EXPENSE INDEX FOR SERVICES

FURNISHED IN FRONTIER STATES.— ‘‘(i) IN GENERAL.—Subject to clause (ii), for purposes of payment for services furnished in a frontier 

State (as defined in section 1886(d)(3)(E)(iii)(II)) on 

or after January 1, 2011, after calculating the practice 

expense index in subparagraph (A)(i), the Secretary 

shall increase any such index to 1.00 if such index 

would otherwise be less that 1.00. The preceding sentence shall not be applied in a budget neutral manner. 

‘‘(ii) LIMITATION.—This subparagraph shall not 

apply to services furnished in a State that receives 

a non-labor related share adjustment under section 

1886(d)(5)(H).’’. 

SEC. 10325. REVISION TO SKILLED NURSING FACILITY PROSPECTIVE 

PAYMENT SYSTEM. 

(a) TEMPORARY DELAY OF RUG–IV.—Notwithstanding any other 

provision of law, the Secretary of Health and Human Services 

shall not, prior to October 1, 2011, implement Version 4 of the 

Resource Utilization Groups (in this subsection refereed to as 

‘‘RUG–IV’’) published in the Federal Register on August 11, 2009, 

entitled ‘‘Prospective Payment System and Consolidated Billing for 
H. R. 3590—843 

Skilled Nursing Facilities for FY 2010; Minimum Data Set, Version 

3.0 for Skilled Nursing Facilities and Medicaid Nursing Facilities’’ 

(74 Fed. Reg. 40288). Beginning on October 1, 2010, the Secretary 

of Health and Human Services shall implement the change specific 

to therapy furnished on a concurrent basis that is a component 

of RUG–IV and changes to the lookback period to ensure that 

only those services furnished after admission to a skilled nursing 

facility are used as factors in determining a case mix classification 

under the skilled nursing facility prospective payment system under 

section 1888(e) of the Social Security Act (42 U.S.C. 1395yy(e)). 

(b) CONSTRUCTION.—Nothing in this section shall be interpreted 

as delaying the implementation of Version 3.0 of the Minimum 

Data Sets (MDS 3.0) beyond the planned implementation date 

of October 1, 2010. 

SEC. 10326. PILOT TESTING PAY-FOR-PERFORMANCE PROGRAMS FOR 

CERTAIN MEDICARE PROVIDERS. 

(a) IN GENERAL.—Not later than January 1, 2016, the Secretary 

of Health and Human Services (in this section referred to as the 

‘‘Secretary’’) shall, for each provider described in subsection (b), 

conduct a separate pilot program under title XVIII of the Social 

Security Act to test the implementation of a value-based purchasing 

program for payments under such title for the provider. 

(b) PROVIDERS DESCRIBED.—The providers described in this 

paragraph are the following: 

(1) Psychiatric hospitals (as described in clause (i) of section 

1886(d)(1)(B) of such Act (42 U.S.C. 1395ww(d)(1)(B))) and psychiatric units (as described in the matter following clause (v) 

of such section). 

(2) Long-term care hospitals (as described in clause (iv) 

of such section). 

(3) Rehabilitation hospitals (as described in clause (ii) of 

such section). 

(4) PPS-exempt cancer hospitals (as described in clause 

(v) of such section). 

(5) Hospice programs (as defined in section 1861(dd)(2) 

of such Act (42 U.S.C. 1395x(dd)(2))). 

(c) WAIVER AUTHORITY.—The Secretary may waive such 

requirements of titles XI and XVIII of the Social Security Act 

as may be necessary solely for purposes of carrying out the pilot 

programs under this section. 

(d) NO ADDITIONAL PROGRAM EXPENDITURES.—Payments under 

this section under the separate pilot program for value based purchasing (as described in subsection (a)) for each provider type 

described in paragraphs (1) through (5) of subsection (b) for 

applicable items and services under title XVIII of the Social Security 

Act for a year shall be established in a manner that does not 

result in spending more under each such value based purchasing 

program for such year than would otherwise be expended for such 

provider type for such year if the pilot program were not implemented, as estimated by the Secretary. 

(e) EXPANSION OF PILOT PROGRAM.—The Secretary may, at 

any point after January 1, 2018, expand the duration and scope 

of a pilot program conducted under this subsection, to the extent 

determined appropriate by the Secretary, if— 

(1) the Secretary determines that such expansion is 

expected to— 
H. R. 3590—844 

(A) reduce spending under title XVIII of the Social 

Security Act without reducing the quality of care; or 

(B) improve the quality of care and reduce spending; 

(2) the Chief Actuary of the Centers for Medicare & Medicaid Services certifies that such expansion would reduce program spending under such title XVIII; and 

(3) the Secretary determines that such expansion would 

not deny or limit the coverage or provision of benefits under 

such title XIII for Medicare beneficiaries. 

SEC. 10327. IMPROVEMENTS TO THE PHYSICIAN QUALITY REPORTING 

SYSTEM. 

(a) IN GENERAL.—Section 1848(m) of the Social Security Act 

(42 U.S.C. 1395w–4(m)) is amended by adding at the end the 

following new paragraph: 

‘‘(7) ADDITIONAL INCENTIVE PAYMENT.— ‘‘(A) IN GENERAL.—For 2011 through 2014, if an eligible 

professional meets the requirements described in subparagraph (B), the applicable quality percent for such year, 

as described in clauses (iii) and (iv) of paragraph (1)(B), 

shall be increased by 0.5 percentage points. 

‘‘(B) REQUIREMENTS DESCRIBED.—In order to qualify 

for the additional incentive payment described in subparagraph (A), an eligible professional shall meet the following 

requirements: 

‘‘(i) The eligible professional shall— 

‘‘(I) satisfactorily submit data on quality measures for purposes of paragraph (1) for a year; and 

‘‘(II) have such data submitted on their behalf 

through a Maintenance of Certification Program 

(as defined in subparagraph (C)(i)) that meets— 

‘‘(aa) the criteria for a registry (as 

described in subsection (k)(4)); or 

‘‘(bb) an alternative form and manner 

determined appropriate by the Secretary. 

‘‘(ii) The eligible professional, more frequently than 

is required to qualify for or maintain board certification 

status— 

‘‘(I) participates in such a Maintenance of Certification program for a year; and 

‘‘(II) successfully completes a qualified Maintenance of Certification Program practice assessment 

(as defined in subparagraph (C)(ii)) for such year. 

‘‘(iii) A Maintenance of Certification program submits to the Secretary, on behalf of the eligible professional, information— 

‘‘(I) in a form and manner specified by the 

Secretary, that the eligible professional has 

successfully met the requirements of clause (ii) 

(which may be in the form of a structural 

measure); 

‘‘(II) if requested by the Secretary, on the 

survey of patient experience with care (as 

described in subparagraph (C)(ii)(II)); and 

‘‘(III) as the Secretary may require, on the 

methods, measures, and data used under the 

Maintenance of Certification Program and the 
H. R. 3590—845 

qualified Maintenance of Certification Program 

practice assessment. 

‘‘(C) DEFINITIONS.—For purposes of this paragraph: 

‘‘(i) The term ‘Maintenance of Certification Program’ means a continuous assessment program, such 

as qualified American Board of Medical Specialties 

Maintenance of Certification program or an equivalent 

program (as determined by the Secretary), that 

advances quality and the lifelong learning and selfassessment of board certified specialty physicians by 

focusing on the competencies of patient care, medical 

knowledge, practice-based learning, interpersonal and 

communication skills and professionalism. Such a program shall include the following: 

‘‘(I) The program requires the physician to 

maintain a valid, unrestricted medical license in 

the United States. 

‘‘(II) The program requires a physician to 

participate in educational and self-assessment programs that require an assessment of what was 

learned. 

‘‘(III) The program requires a physician to 

demonstrate, through a formalized, secure examination, that the physician has the fundamental 

diagnostic skills, medical knowledge, and clinical 

judgment to provide quality care in their respective 

specialty. 

‘‘(IV) The program requires successful completion of a qualified Maintenance of Certification 

Program practice assessment as described in 

clause (ii). 

‘‘(ii) The term ‘qualified Maintenance of Certification Program practice assessment’ means an assessment of a physician’s practice that— 

‘‘(I) includes an initial assessment of an 

eligible professional’s practice that is designed to 

demonstrate the physician’s use of evidence-based 

medicine; 

‘‘(II) includes a survey of patient experience 

with care; and 

‘‘(III) requires a physician to implement a 

quality improvement intervention to address a 

practice weakness identified in the initial assessment under subclause (I) and then to remeasure 

to assess performance improvement after such 

intervention.’’. 

(b) AUTHORITY.—Section 3002(c) of this Act is amended by 

adding at the end the following new paragraph: 

‘‘(3) AUTHORITY.—For years after 2014, if the Secretary 

of Health and Human Services determines it to be appropriate, 

the Secretary may incorporate participation in a Maintenance 

of Certification Program and successful completion of a qualified 

Maintenance of Certification Program practice assessment into 

the composite of measures of quality of care furnished pursuant 

to the physician fee schedule payment modifier, as described 

in section 1848(p)(2) of the Social Security Act (42 U.S.C. 

1395w–4(p)(2)).’’. 
H. R. 3590—846 

(c) ELIMINATION OF MA REGIONAL PLAN STABILIZATION FUND.— 

(1) IN GENERAL.—Section 1858 of the Social Security Act 

(42 U.S.C. 1395w–27a) is amended by striking subsection (e). 

(2) TRANSITION.—Any amount contained in the MA 

Regional Plan Stabilization Fund as of the date of the enactment of this Act shall be transferred to the Federal Supplementary Medical Insurance Trust Fund. 

SEC. 10328. IMPROVEMENT IN PART D MEDICATION THERAPY MANAGEMENT (MTM) PROGRAMS. 

(a) IN GENERAL.—Section 1860D–4(c)(2) of the Social Security 

Act (42 U.S.C. 1395w–104(c)(2)) is amended— 

(1) by redesignating subparagraphs (C), (D), and (E) as 

subparagraphs (E), (F), and (G), respectively; and 

(2) by inserting after subparagraph (B) the following new 

subparagraphs: 

‘‘(C) REQUIRED INTERVENTIONS.—For plan years beginning on or after the date that is 2 years after the date 

of the enactment of the Patient Protection and Affordable 

Care Act, prescription drug plan sponsors shall offer medication therapy management services to targeted beneficiaries described in subparagraph (A)(ii) that include, at 

a minimum, the following to increase adherence to prescription medications or other goals deemed necessary by the 

Secretary: 

‘‘(i) An annual comprehensive medication review 

furnished person-to-person or using telehealth technologies (as defined by the Secretary) by a licensed 

pharmacist or other qualified provider. The comprehensive medication review— 

‘‘(I) shall include a review of the individual’s 

medications and may result in the creation of a 

recommended medication action plan or other 

actions in consultation with the individual and 

with input from the prescriber to the extent necessary and practicable; and 

‘‘(II) shall include providing the individual 

with a written or printed summary of the results 

of the review. 

The Secretary, in consultation with relevant stakeholders, shall develop a standardized format for the 

action plan under subclause (I) and the summary under 

subclause (II). 

‘‘(ii) Follow-up interventions as warranted based 

on the findings of the annual medication review or 

the targeted medication enrollment and which may 

be provided person-to-person or using telehealth technologies (as defined by the Secretary). 

‘‘(D) ASSESSMENT.—The prescription drug plan sponsor 

shall have in place a process to assess, at least on a 

quarterly basis, the medication use of individuals who are 

at risk but not enrolled in the medication therapy management program, including individuals who have experienced 

a transition in care, if the prescription drug plan sponsor 

has access to that information. 
H. R. 3590—847 

‘‘(E) AUTOMATIC ENROLLMENT WITH ABILITY TO OPT- OUT.—The prescription drug plan sponsor shall have in 

place a process to— 

‘‘(i) subject to clause (ii), automatically enroll targeted beneficiaries described in subparagraph (A)(ii), 

including beneficiaries identified under subparagraph 

(D), in the medication therapy management program 

required under this subsection; and 

‘‘(ii) permit such beneficiaries to opt-out of enrollment in such program.’’. 

(b) RULE OF CONSTRUCTION.—Nothing in this section shall limit 

the authority of the Secretary of Health and Human Services to 

modify or broaden requirements for a medication therapy management program under part D of title XVIII of the Social Security 

Act or to study new models for medication therapy management 

through the Center for Medicare and Medicaid Innovation under 

section 1115A of such Act, as added by section 3021. 

SEC. 10329. DEVELOPING METHODOLOGY TO ASSESS HEALTH PLAN 

VALUE. 

(a) DEVELOPMENT.—The Secretary of Health and Human Services (referred to in this section as the ‘‘Secretary’’), in consultation 

with relevant stakeholders including health insurance issuers, 

health care consumers, employers, health care providers, and other 

entities determined appropriate by the Secretary, shall develop 

a methodology to measure health plan value. Such methodology 

shall take into consideration, where applicable— 

(1) the overall cost to enrollees under the plan; 

(2) the quality of the care provided for under the plan; 

(3) the efficiency of the plan in providing care; 

(4) the relative risk of the plan’s enrollees as compared 

to other plans; 

(5) the actuarial value or other comparative measure of 

the benefits covered under the plan; and 

(6) other factors determined relevant by the Secretary. 

(b) REPORT.—Not later than 18 months after the date of enactment of this Act, the Secretary shall submit to Congress a report 

concerning the methodology developed under subsection (a). 

SEC. 10330. MODERNIZING COMPUTER AND DATA SYSTEMS OF THE 

CENTERS FOR MEDICARE & MEDICAID SERVICES TO SUPPORT IMPROVEMENTS IN CARE DELIVERY. 

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

(in this section referred to as the ‘‘Secretary’’) shall develop a 

plan (and detailed budget for the resources needed to implement 

such plan) to modernize the computer and data systems of the 

Centers for Medicare & Medicaid Services (in this section referred 

to as ‘‘CMS’’). 

(b) CONSIDERATIONS.—In developing the plan, the Secretary 

shall consider how such modernized computer system could— 

(1) in accordance with the regulations promulgated under 

section 264(c) of the Health Insurance Portability and Accountability Act of 1996, make available data in a reliable and 

timely manner to providers of services and suppliers to support 

their efforts to better manage and coordinate care furnished 

to beneficiaries of CMS programs; and 

(2) support consistent evaluations of payment and delivery 

system reforms under CMS programs. 
H. R. 3590—848 

(c) POSTING OF PLAN.—By not later than 9 months after the 

date of the enactment of this Act, the Secretary shall post on 

the website of the Centers for Medicare & Medicaid Services the 

plan described in subsection (a). 

SEC. 10331. PUBLIC REPORTING OF PERFORMANCE INFORMATION. 

(a) IN GENERAL.— 

(1) DEVELOPMENT.—Not later than January 1, 2011, the 

Secretary shall develop a Physician Compare Internet website 

with information on physicians enrolled in the Medicare program under section 1866(j) of the Social Security Act (42 U.S.C. 

1395cc(j)) and other eligible professionals who participate in 

the Physician Quality Reporting Initiative under section 1848 

of such Act (42 U.S.C. 1395w–4). 

(2) PLAN.—Not later than January 1, 2013, and with 

respect to reporting periods that begin no earlier than January 

1, 2012, the Secretary shall also implement a plan for making 

publicly available through Physician Compare, consistent with 

subsection (c), information on physician performance that provides comparable information for the public on quality and 

patient experience measures with respect to physicians enrolled 

in the Medicare program under such section 1866(j). To the 

extent scientifically sound measures that are developed consistent with the requirements of this section are available, 

such information, to the extent practicable, shall include— 

(A) measures collected under the Physician Quality 

Reporting Initiative; 

(B) an assessment of patient health outcomes and the 

functional status of patients; 

(C) an assessment of the continuity and coordination 

of care and care transitions, including episodes of care 

and risk-adjusted resource use; 

(D) an assessment of efficiency; 

(E) an assessment of patient experience and patient, 

caregiver, and family engagement; 

(F) an assessment of the safety, effectiveness, and timeliness of care; and 

(G) other information as determined appropriate by 

the Secretary. 

(b) OTHER REQUIRED CONSIDERATIONS.—In developing and 

implementing the plan described in subsection (a)(2), the Secretary 

shall, to the extent practicable, include— 

(1) processes to assure that data made public, either by 

the Centers for Medicare & Medicaid Services or by other 

entities, is statistically valid and reliable, including risk adjustment mechanisms used by the Secretary; 

(2) processes by which a physician or other eligible professional whose performance on measures is being publicly 

reported has a reasonable opportunity, as determined by the 

Secretary, to review his or her individual results before they 

are made public; 

(3) processes by the Secretary to assure that the 

implementation of the plan and the data made available on 

Physician Compare provide a robust and accurate portrayal 

of a physician’s performance; 

(4) data that reflects the care provided to all patients 

seen by physicians, under both the Medicare program and, 
H. R. 3590—849 

to the extent practicable, other payers, to the extent such 

information would provide a more accurate portrayal of physician performance; 

(5) processes to ensure appropriate attribution of care when 

multiple physicians and other providers are involved in the 

care of a patient; 

(6) processes to ensure timely statistical performance feedback is provided to physicians concerning the data reported 

under any program subject to public reporting under this section; and 

(7) implementation of computer and data systems of the 

Centers for Medicare & Medicaid Services that support valid, 

reliable, and accurate public reporting activities authorized 

under this section. 

(c) ENSURING PATIENT PRIVACY.—The Secretary shall ensure 

that information on physician performance and patient experience 

is not disclosed under this section in a manner that violates sections 

552 or 552a of title 5, United States Code, with regard to the 

privacy of individually identifiable health information. 

(d) FEEDBACK FROM MULTI-STAKEHOLDER GROUPS.—The Secretary shall take into consideration input provided by multi-stakeholder groups, consistent with sections 1890(b)(7) and 1890A of 

the Social Security Act, as added by section 3014 of this Act, 

in selecting quality measures for use under this section. 

(e) CONSIDERATION OF TRANSITION TO VALUE-BASED PURCHASING.—In developing the plan under this subsection (a)(2), the 

Secretary shall, as the Secretary determines appropriate, consider 

the plan to transition to a value-based purchasing program for 

physicians and other practitioners developed under section 131 

of the Medicare Improvements for Patients and Providers Act of 

2008 (Public Law 110–275). 

(f) REPORT TO CONGRESS.—Not later than January 1, 2015, 

the Secretary shall submit to Congress a report on the Physician 

Compare Internet website developed under subsection (a)(1). Such 

report shall include information on the efforts of and plans made 

by the Secretary to collect and publish data on physician quality 

and efficiency and on patient experience of care in support of 

value-based purchasing and consumer choice, together with recommendations for such legislation and administrative action as 

the Secretary determines appropriate. 

(g) EXPANSION.—At any time before the date on which the 

report is submitted under subsection (f), the Secretary may expand 

(including expansion to other providers of services and suppliers 

under title XVIII of the Social Security Act) the information made 

available on such website. 

(h) FINANCIAL INCENTIVES TO ENCOURAGE CONSUMERS TO

CHOOSE HIGH QUALITY PROVIDERS.—The Secretary may establish 

a demonstration program, not later than January 1, 2019, to provide 

financial incentives to Medicare beneficiaries who are furnished 

services by high quality physicians, as determined by the Secretary 

based on factors in subparagraphs (A) through (G) of subsection 

(a)(2). In no case may Medicare beneficiaries be required to pay 

increased premiums or cost sharing or be subject to a reduction 

in benefits under title XVIII of the Social Security Act as a result 

of such demonstration program. The Secretary shall ensure that 
H. R. 3590—850 

any such demonstration program does not disadvantage those beneficiaries without reasonable access to high performing physicians 

or create financial inequities under such title. 

(i) DEFINITIONS.—In this section: 

(1) ELIGIBLE PROFESSIONAL.—The term ‘‘eligible professional’’ has the meaning given that term for purposes of the 

Physician Quality Reporting Initiative under section 1848 of 

the Social Security Act (42 U.S.C. 1395w–4). 

(2) PHYSICIAN.—The term ‘‘physician’’ has the meaning 

given that term in section 1861(r) of such Act (42 U.S.C. 

1395x(r)). 

(3) PHYSICIAN COMPARE.—The term ‘‘Physician Compare’’ 

means the Internet website developed under subsection (a)(1). 

(4) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 

of Health and Human Services. 

SEC. 10332. AVAILABILITY OF MEDICARE DATA FOR PERFORMANCE 

MEASUREMENT. 

(a) IN GENERAL.—Section 1874 of the Social Security Act (42 

U.S.C. 1395kk) is amended by adding at the end the following 

new subsection: 

‘‘(e) AVAILABILITY OF MEDICARE DATA.— 

‘‘(1) IN GENERAL.—Subject to paragraph (4), the Secretary 

shall make available to qualified entities (as defined in paragraph (2)) data described in paragraph (3) for the evaluation 

of the performance of providers of services and suppliers. 

‘‘(2) QUALIFIED ENTITIES.—For purposes of this subsection, 

the term ‘qualified entity’ means a public or private entity 

that— 

‘‘(A) is qualified (as determined by the Secretary) to 

use claims data to evaluate the performance of providers 

of services and suppliers on measures of quality, efficiency, 

effectiveness, and resource use; and 

‘‘(B) agrees to meet the requirements described in paragraph (4) and meets such other requirements as the Secretary may specify, such as ensuring security of data. 

‘‘(3) DATA DESCRIBED.—The data described in this paragraph are standardized extracts (as determined by the Secretary) of claims data under parts A, B, and D for items 

and services furnished under such parts for one or more specified geographic areas and time periods requested by a qualified 

entity. The Secretary shall take such actions as the Secretary 

deems necessary to protect the identity of individuals entitled 

to or enrolled for benefits under such parts. 

‘‘(4) REQUIREMENTS.— 

‘‘(A) FEE.—Data described in paragraph (3) shall be 

made available to a qualified entity under this subsection 

at a fee equal to the cost of making such data available. 

Any fee collected pursuant to the preceding sentence shall 

be deposited into the Federal Supplementary Medical 

Insurance Trust Fund under section 1841. 

‘‘(B) SPECIFICATION OF USES AND METHODOLOGIES.— 

A qualified entity requesting data under this subsection 

shall— 

‘‘(i) submit to the Secretary a description of the 

methodologies that such qualified entity will use to 
H. R. 3590—851 

evaluate the performance of providers of services and 

suppliers using such data; 

‘‘(ii)(I) except as provided in subclause (II), if available, use standard measures, such as measures 

endorsed by the entity with a contract under section 

1890(a) and measures developed pursuant to section 

931 of the Public Health Service Act; or 

‘‘(II) use alternative measures if the Secretary, 

in consultation with appropriate stakeholders, determines that use of such alternative measures would 

be more valid, reliable, responsive to consumer preferences, cost-effective, or relevant to dimensions of 

quality and resource use not addressed by such 

standard measures; 

‘‘(iii) include data made available under this subsection with claims data from sources other than claims 

data under this title in the evaluation of performance 

of providers of services and suppliers; 

‘‘(iv) only include information on the evaluation 

of performance of providers and suppliers in reports 

described in subparagraph (C); 

‘‘(v) make available to providers of services and 

suppliers, upon their request, data made available 

under this subsection; and 

‘‘(vi) prior to their release, submit to the Secretary 

the format of reports under subparagraph (C). 

‘‘(C) REPORTS.—Any report by a qualified entity evaluating the performance of providers of services and suppliers 

using data made available under this subsection shall— 

‘‘(i) include an understandable description of the 

measures, which shall include quality measures and 

the rationale for use of other measures described in 

subparagraph (B)(ii)(II), risk adjustment methods, 

physician attribution methods, other applicable 

methods, data specifications and limitations, and the 

sponsors, so that consumers, providers of services and 

suppliers, health plans, researchers, and other stakeholders can assess such reports; 

‘‘(ii) be made available confidentially, to any provider of services or supplier to be identified in such 

report, prior to the public release of such report, and 

provide an opportunity to appeal and correct errors; 

‘‘(iii) only include information on a provider of 

services or supplier in an aggregate form as determined 

appropriate by the Secretary; and 

‘‘(iv) except as described in clause (ii), be made 

available to the public. 

‘‘(D) APPROVAL AND LIMITATION OF USES.—The Secretary shall not make data described in paragraph (3) 

available to a qualified entity unless the qualified entity 

agrees to release the information on the evaluation of 

performance of providers of services and suppliers. Such 

entity shall only use such data, and information derived 

from such evaluation, for the reports under subparagraph 

(C). Data released to a qualified entity under this subsection shall not be subject to discovery or admission as 
H. R. 3590—852 

evidence in judicial or administrative proceedings without 

consent of the applicable provider of services or supplier.’’. 

(b) EFFECTIVE DATE.—The amendment made by subsection (a) 

shall take effect on January 1, 2012. 

SEC. 10333. COMMUNITY-BASED COLLABORATIVE CARE NETWORKS. 

Part D of title III of the Public Health Service Act (42 U.S.C. 

254b et seq.) is amended by adding at the end the following new 

subpart: 

‘‘Subpart XI—Community-Based Collaborative 

Care Network Program 

‘‘SEC. 340H. COMMUNITY-BASED COLLABORATIVE CARE NETWORK 

PROGRAM. 

‘‘(a) IN GENERAL.—The Secretary may award grants to eligible 

entities to support community-based collaborative care networks 

that meet the requirements of subsection (b). 

‘‘(b) COMMUNITY-BASED COLLABORATIVE CARE NETWORKS.— ‘‘(1) DESCRIPTION.—A community-based collaborative care 

network (referred to in this section as a ‘network’) shall be 

a consortium of health care providers with a joint governance 

structure (including providers within a single entity) that provides comprehensive coordinated and integrated health care 

services (as defined by the Secretary) for low-income populations. 

‘‘(2) REQUIRED INCLUSION.—A network shall include the 

following providers (unless such provider does not exist within 

the community, declines or refuses to participate, or places 

unreasonable conditions on their participation): 

‘‘(A) A hospital that meets the criteria in section 

1923(b)(1) of the Social Security Act; and 

‘‘(B) All Federally qualified health centers (as defined 

in section 1861(aa) of the Social Security Act located in 

the community. 

‘‘(3) PRIORITY.—In awarding grants, the Secretary shall 

give priority to networks that include— 

‘‘(A) the capability to provide the broadest range of 

services to low-income individuals; 

‘‘(B) the broadest range of providers that currently 

serve a high volume of low-income individuals; and 

‘‘(C) a county or municipal department of health. 

‘‘(c) APPLICATION.— 

‘‘(1) APPLICATION.—A network described in subsection (b) 

shall submit an application to the Secretary. 

‘‘(2) RENEWAL.—In subsequent years, based on the performance of grantees, the Secretary may provide renewal grants 

to prior year grant recipients. 

‘‘(d) USE OF FUNDS.— ‘‘(1) USE BY GRANTEES.—Grant funds may be used for the 

following activities: 

‘‘(A) Assist low-income individuals to— 

‘‘(i) access and appropriately use health services; 

‘‘(ii) enroll in health coverage programs; and 

‘‘(iii) obtain a regular primary care provider or 

a medical home. 

‘‘(B) Provide case management and care management. 
H. R. 3590—853 

‘‘(C) Perform health outreach using neighborhood 

health workers or through other means. 

‘‘(D) Provide transportation. 

‘‘(E) Expand capacity, including through telehealth, 

after-hours services or urgent care. 

‘‘(F) Provide direct patient care services. 

‘‘(2) GRANT FUNDS TO HRSA GRANTEES.—The Secretary may 

limit the percent of grant funding that may be spent on direct 

care services provided by grantees of programs administered 

by the Health Resources and Services Administration or impose 

other requirements on such grantees deemed necessary. 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as may 

be necessary for each of fiscal years 2011 through 2015.’’. 

SEC. 10334. MINORITY HEALTH. 

(a) OFFICE OF MINORITY HEALTH.— 

(1) IN GENERAL.—Section 1707 of the Public Health Service 

Act (42 U.S.C. 300u–6) is amended— 

(A) in subsection (a), by striking ‘‘within the Office 

of Public Health and Science’’ and all that follows through 

the end and inserting ‘‘. The Office of Minority Health 

as existing on the date of enactment of the Patient Protection and Affordable Care Act shall be transferred to the 

Office of the Secretary in such manner that there is established in the Office of the Secretary, the Office of Minority 

Health, which shall be headed by the Deputy Assistant 

Secretary for Minority Health who shall report directly 

to the Secretary, and shall retain and strengthen authorities (as in existence on such date of enactment) for the 

purpose of improving minority health and the quality of 

health care minorities receive, and eliminating racial and 

ethnic disparities. In carrying out this subsection, the Secretary, acting through the Deputy Assistant Secretary, 

shall award grants, contracts, enter into memoranda of 

understanding, cooperative, interagency, intra-agency and 

other agreements with public and nonprofit private entities, 

agencies, as well as Departmental and Cabinet agencies 

and organizations, and with organizations that are indigenous human resource providers in communities of color 

to assure improved health status of racial and ethnic 

minorities, and shall develop measures to evaluate the 

effectiveness of activities aimed at reducing health disparities and supporting the local community. Such measures 

shall evaluate community outreach activities, language 

services, workforce cultural competence, and other areas 

as determined by the Secretary.’’; and 

(B) by striking subsection (h) and inserting the following: 

‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of fiscal years 2011 through 

2016.’’. 

(2) TRANSFER OF FUNCTIONS.—There are transferred to the 

Office of Minority Health in the office of the Secretary of 

Health and Human Services, all duties, responsibilities, 

authorities, accountabilities, functions, staff, funds, award 
H. R. 3590—854 

mechanisms, and other entities under the authority of the 

Office of Minority Health of the Public Health Service as in 

effect on the date before the date of enactment of this Act, 

which shall continue in effect according to the terms in effect 

on the date before such date of enactment, until modified, 

terminated, superseded, set aside, or revoked in accordance 

with law by the President, the Secretary, a court of competent 

jurisdiction, or by operation of law. 

(3) REPORTS.—Not later than 1 year after the date of enactment of this section, and biennially thereafter, the Secretary 

of Health and Human Services shall prepare and submit to 

the appropriate committees of Congress a report describing 

the activities carried out under section 1707 of the Public 

Health Service Act (as amended by this subsection) during 

the period for which the report is being prepared. Not later 

than 1 year after the date of enactment of this section, and 

biennially thereafter, the heads of each of the agencies of the 

Department of Health and Human Services shall submit to 

the Deputy Assistant Secretary for Minority Health a report 

summarizing the minority health activities of each of the 

respective agencies. 

(b) ESTABLISHMENT OF INDIVIDUAL OFFICES OF MINORITY

HEALTH WITHIN THE DEPARTMENT OF HEALTH AND HUMAN SERVICES.— 

(1) IN GENERAL.—Title XVII of the Public Health Service 

Act (42 U.S.C. 300u et seq.) is amended by inserting after 

section 1707 the following section: 

‘‘SEC. 1707A. INDIVIDUAL OFFICES OF MINORITY HEALTH WITHIN THE 

DEPARTMENT. 

‘‘(a) IN GENERAL.—The head of each agency specified in subsection (b)(1) shall establish within the agency an office to be 

known as the Office of Minority Health. The head of each such 

Office shall be appointed by the head of the agency within which 

the Office is established, and shall report directly to the head 

of the agency. The head of such agency shall carry out this section 

(as this section relates to the agency) acting through such Director. 

‘‘(b) SPECIFIED AGENCIES.—The agencies referred to in subsection (a) are the Centers for Disease Control and Prevention, 

the Health Resources and Services Administration, the Substance 

Abuse and Mental Health Services Administration, the Agency for 

Healthcare Research and Quality, the Food and Drug Administration, and the Centers for Medicare & Medicaid Services. 

‘‘(c) DIRECTOR; APPOINTMENT.—Each Office of Minority Health 

established in an agency listed in subsection (a) shall be headed 

by a director, with documented experience and expertise in minority 

health services research and health disparities elimination. 

‘‘(d) REFERENCES.—Except as otherwise specified, any reference 

in Federal law to an Office of Minority Health (in the Department 

of Health and Human Services) is deemed to be a reference to 

the Office of Minority Health in the Office of the Secretary. 

‘‘(e) FUNDING.— ‘‘(1) ALLOCATIONS.—Of the amounts appropriated for a 

specified agency for a fiscal year, the Secretary must designate 

an appropriate amount of funds for the purpose of carrying 

out activities under this section through the minority health 

office of the agency. In reserving an amount under the preceding 
H. R. 3590—855 

sentence for a minority health office for a fiscal year, the 

Secretary shall reduce, by substantially the same percentage, 

the amount that otherwise would be available for each of the 

programs of the designated agency involved. 

‘‘(2) AVAILABILITY OF FUNDS FOR STAFFING.—The purposes 

for which amounts made available under paragraph may be 

expended by a minority health office include the costs of 

employing staff for such office.’’. 

(2) NO NEW REGULATORY AUTHORITY.—Nothing in this subsection and the amendments made by this subsection may 

be construed as establishing regulatory authority or modifying 

any existing regulatory authority. 

(3) LIMITATION ON TERMINATION.—Notwithstanding any 

other provision of law, a Federal office of minority health or 

Federal appointive position with primary responsibility over 

minority health issues that is in existence in an office of agency 

of the Department of Health and Human Services on the date 

of enactment of this section shall not be terminated, reorganized, or have any of its power or duties transferred unless 

such termination, reorganization, or transfer is approved by 

an Act of Congress. 

(c) REDESIGNATION OF NATIONAL CENTER ON MINORITY HEALTH

AND HEALTH DISPARITIES.— 

(1) REDESIGNATION.—Title IV of the Public Health Service 

Act (42 U.S.C. 281 et seq.) is amended— 

(A) by redesignating subpart 6 of part E as subpart 

20; 

(B) by transferring subpart 20, as so redesignated, 

to part C of such title IV; 

(C) by inserting subpart 20, as so redesignated, after 

subpart 19 of such part C; and 

(D) in subpart 20, as so redesignated— 

(i) by redesignating sections 485E through 485H 

as sections 464z–3 through 464z–6, respectively; 

(ii) by striking ‘‘National Center on Minority 

Health and Health Disparities’’ each place such term 

appears and inserting ‘‘National Institute on Minority 

Health and Health Disparities’’; and 

(iii) by striking ‘‘Center’’ each place such term 

appears and inserting ‘‘Institute’’. 

(2) PURPOSE OF INSTITUTE; DUTIES.—Section 464z–3 of the 

Public Health Service Act, as so redesignated, is amended— 

(A) in subsection (h)(1), by striking ‘‘research endowments at centers of excellence under section 736.’’ and 

inserting the following: ‘‘research endowments— 

‘‘(1) at centers of excellence under section 736; and 

‘‘(2) at centers of excellence under section 464z–4.’’; 

(B) in subsection (h)(2)(A), by striking ‘‘average’’ and 

inserting ‘‘median’’; and 

(C) by adding at the end the following: 

‘‘(h) INTERAGENCY COORDINATION.—The Director of the 

Institute, as the primary Federal officials with responsibility for 

coordinating all research and activities conducted or supported by 

the National Institutes of Health on minority health and health 

disparities, shall plan, coordinate, review and evaluate research 

and other activities conducted or supported by the Institutes and 

Centers of the National Institutes of Health.’’. 
H. R. 3590—856 

(3) TECHNICAL AND CONFORMING AMENDMENTS.— (A) Section 401(b)(24) of the Public Health Service 

Act (42 U.S.C. 281(b)(24)) is amended by striking ‘‘Center’’ 

and inserting ‘‘Institute’’. 

(B) Subsection (d)(1) of section 903 of the Public Health 

Service Act (42 U.S.C. 299a–1(d)(1)) is amended by striking 

‘‘section 485E’’ and inserting ‘‘section 464z–3’’. 

SEC. 10335. TECHNICAL CORRECTION TO THE HOSPITAL VALUE-BASED 

PURCHASING PROGRAM. 

Section 1886(o)(2)A) of the Social Security Act, as added by 

section 3001, is amended, in the first sentence, by inserting ‘‘, 

other than measures of readmissions,’’ after ‘‘shall select measures’’. 

SEC. 10336. GAO STUDY AND REPORT ON MEDICARE BENEFICIARY 

ACCESS TO HIGH-QUALITY DIALYSIS SERVICES. 

(a) STUDY.— (1) IN GENERAL.—The Comptroller General of the United 

States shall conduct a study on the impact on Medicare beneficiary access to high-quality dialysis services of including specified oral drugs that are furnished to such beneficiaries for 

the treatment of end stage renal disease in the bundled prospective payment system under section 1881(b)(14) of the Social 

Security Act (42 U.S.C. 1395rr(b)(14)) (pursuant to the proposed 

rule published by the Secretary of Health and Human Services 

in the Federal Register on September 29, 2009 (74 Fed. Reg. 

49922 et seq.)). Such study shall include an analysis of— 

(A) the ability of providers of services and renal dialysis 

facilities to furnish specified oral drugs or arrange for 

the provision of such drugs; 

(B) the ability of providers of services and renal dialysis 

facilities to comply, if necessary, with applicable State laws 

(such as State pharmacy licensure requirements) in order 

to furnish specified oral drugs; 

(C) whether appropriate quality measures exist to safeguard care for Medicare beneficiaries being furnished specified oral drugs by providers of services and renal dialysis 

facilities; and 

(D) other areas determined appropriate by the Comptroller General. 

(2) SPECIFIED ORAL DRUG DEFINED.—For purposes of paragraph (1), the term ‘‘specified oral drug’’ means a drug or 

biological for which there is no injectable equivalent (or other 

non-oral form of administration). 

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Comptroller General of the United States 

shall submit to Congress a report containing the results of the 

study conducted under subsection (a), together with recommendations for such legislation and administrative action as the Comptroller General determines appropriate. 

Subtitle D—Provisions Relating to Title IV 

SEC. 10401. AMENDMENTS TO SUBTITLE A. 

(a) Section 4001(h)(4) and (5) of this Act is amended by striking 

‘‘2010’’ each place such appears and inserting ‘‘2020’’. 

(b) Section 4002(c) of this Act is amended— 
H. R. 3590—857 

(1) by striking ‘‘research and health screenings’’ and 

inserting ‘‘research, health screenings, and initiatives’’; and 

(2) by striking ‘‘for Preventive’’ and inserting ‘‘Regarding 

Preventive’’. 

(c) Section 4004(a)(4) of this Act is amended by striking ‘‘a 

Gateway’’ and inserting ‘‘an Exchange’’. 

SEC. 10402. AMENDMENTS TO SUBTITLE B. 

(a) Section 399Z–1(a)(1(A) of the Public Health Service Act, 

as added by section 4101(b) of this Act, is amended by inserting 

‘‘and vision’’ after ‘‘oral’’. 

(b) Section 1861(hhh)(4)(G) of the Social Security Act, as added 

by section 4103(b), is amended to read as follows: 

‘‘(G) A beneficiary shall be eligible to receive only an 

initial preventive physical examination (as defined under 

subsection (ww)(1)) during the 12-month period after the 

date that the beneficiary’s coverage begins under part B 

and shall be eligible to receive personalized prevention 

plan services under this subsection each year thereafter 

provided that the beneficiary has not received either an 

initial preventive physical examination or personalized 

prevention plan services within the preceding 12-month 

period.’’. 

SEC. 10403. AMENDMENTS TO SUBTITLE C. 

Section 4201 of this Act is amended— 

(1) in subsection (a), by adding before the period the following: ‘‘, with not less than 20 percent of such grants being 

awarded to rural and frontier areas’’; 

(2) in subsection (c)(2)(B)(vii), by striking ‘‘both urban and 

rural areas’’ and inserting ‘‘urban, rural, and frontier areas’’; 

and 

(3) in subsection (f), by striking ‘‘each fiscal years’’ and 

inserting ‘‘each of fiscal year’’. 

SEC. 10404. AMENDMENTS TO SUBTITLE D. 

Section 399MM(2) of the Public Health Service Act, as added 

by section 4303 of this Act, is amended by striking ‘‘by ensuring’’ 

and inserting ‘‘and ensuring’’. 

SEC. 10405. AMENDMENTS TO SUBTITLE E. 

Subtitle E of title IV of this Act is amended by striking section 

4401. 

SEC. 10406. AMENDMENT RELATING TO WAIVING COINSURANCE FOR 

PREVENTIVE SERVICES. 

Section 4104(b) of this Act is amended to read as follows: 

‘‘(b) PAYMENT AND ELIMINATION OF COINSURANCE IN ALL SETTINGS.—Section 1833(a)(1) of the Social Security Act (42 U.S.C. 

1395l(a)(1)), as amended by section 4103(c)(1), is amended— 

‘‘(1) in subparagraph (T), by inserting ‘(or 100 percent 

if such services are recommended with a grade of A or B 

by the United States Preventive Services Task Force for any 

indication or population and are appropriate for the individual)’ 

after ‘80 percent’; 

‘‘(2) in subparagraph (W)— 
H. R. 3590—858 

‘‘(A) in clause (i), by inserting ‘(if such subparagraph 

were applied, by substituting ‘‘100 percent’’ for ‘‘80 percent’’)’ after ‘subparagraph (D)’; and 

‘‘(B) in clause (ii), by striking ‘80 percent’ and inserting 

‘100 percent’; 

‘‘(3) by striking ‘and’ before ‘(X)’; and 

‘‘(4) by inserting before the semicolon at the end the following: ‘, and (Y) with respect to preventive services described 

in subparagraphs (A) and (B) of section 1861(ddd)(3) that are 

appropriate for the individual and, in the case of such services 

described in subparagraph (A), are recommended with a grade 

of A or B by the United States Preventive Services Task Force 

for any indication or population, the amount paid shall be 

100 percent of (i) except as provided in clause (ii), the lesser 

of the actual charge for the services or the amount determined 

under the fee schedule that applies to such services under 

this part, and (ii) in the case of such services that are covered 

OPD services (as defined in subsection (t)(1)(B)), the amount 

determined under subsection (t)’.’’. 

SEC. 10407. BETTER DIABETES CARE. 

(a) SHORT TITLE.—This section may be cited as the ‘‘Catalyst 

to Better Diabetes Care Act of 2009’’. 

(b) NATIONAL DIABETES REPORT CARD.— 

(1) IN GENERAL.—The Secretary, in collaboration with the 

Director of the Centers for Disease Control and Prevention 

(referred to in this section as the ‘‘Director’’), shall prepare 

on a biennial basis a national diabetes report card (referred 

to in this section as a ‘‘Report Card’’) and, to the extent possible, 

for each State. 

(2) CONTENTS.— (A) IN GENERAL.—Each Report Card shall include 

aggregate health outcomes related to individuals diagnosed 

with diabetes and prediabetes including— 

(i) preventative care practices and quality of care; 

(ii) risk factors; and 

(iii) outcomes. 

(B) UPDATED REPORTS.—Each Report Card that is prepared after the initial Report Card shall include trend 

analysis for the Nation and, to the extent possible, for 

each State, for the purpose of— 

(i) tracking progress in meeting established 

national goals and objectives for improving diabetes 

care, costs, and prevalence (including Healthy People 

2010); and 

(ii) informing policy and program development. 

(3) AVAILABILITY.—The Secretary, in collaboration with the 

Director, shall make each Report Card publicly available, 

including by posting the Report Card on the Internet. 

(c) IMPROVEMENT OF VITAL STATISTICS COLLECTION.— 

(1) IN GENERAL.—The Secretary, acting through the 

Director of the Centers for Disease Control and Prevention 

and in collaboration with appropriate agencies and States, 

shall— 

(A) promote the education and training of physicians 

on the importance of birth and death certificate data and 

how to properly complete these documents, including the 
H. R. 3590—859 

collection of such data for diabetes and other chronic diseases; 

(B) encourage State adoption of the latest standard 

revisions of birth and death certificates; and 

(C) work with States to re-engineer their vital statistics 

systems in order to provide cost-effective, timely, and 

accurate vital systems data. 

(2) DEATH CERTIFICATE ADDITIONAL LANGUAGE.—In carrying out this subsection, the Secretary may promote improvements to the collection of diabetes mortality data, including 

the addition of a question for the individual certifying the 

cause of death regarding whether the deceased had diabetes. 

(d) STUDY ON APPROPRIATE LEVEL OF DIABETES MEDICAL EDUCATION.— 

(1) IN GENERAL.—The Secretary shall, in collaboration with 

the Institute of Medicine and appropriate associations and councils, conduct a study of the impact of diabetes on the practice 

of medicine in the United States and the appropriateness of 

the level of diabetes medical education that should be required 

prior to licensure, board certification, and board recertification. 

(2) REPORT.—Not later than 2 years after the date of the 

enactment of this Act, the Secretary shall submit a report 

on the study under paragraph (1) to the Committees on Ways 

and Means and Energy and Commerce of the House of Representatives and the Committees on Finance and Health, Education, Labor, and Pensions of the Senate. 

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section such sums as may 

be necessary. 

SEC. 10408. GRANTS FOR SMALL BUSINESSES TO PROVIDE COMPREHENSIVE WORKPLACE WELLNESS PROGRAMS. 

(a) ESTABLISHMENT.—The Secretary shall award grants to 

eligible employers to provide their employees with access to comprehensive workplace wellness programs (as described under subsection (c)). 

(b) SCOPE.— 

(1) DURATION.—The grant program established under this 

section shall be conducted for a 5-year period. 

(2) ELIGIBLE EMPLOYER.—The term ‘‘eligible employer’’ 

means an employer (including a non-profit employer) that— 

(A) employs less than 100 employees who work 25 

hours or greater per week; and 

(B) does not provide a workplace wellness program 

as of the date of enactment of this Act. 

(c) COMPREHENSIVE WORKPLACE WELLNESS PROGRAMS.— 

(1) CRITERIA.—The Secretary shall develop program criteria 

for comprehensive workplace wellness programs under this section that are based on and consistent with evidence-based 

research and best practices, including research and practices 

as provided in the Guide to Community Preventive Services, 

the Guide to Clinical Preventive Services, and the National 

Registry for Effective Programs. 

(2) REQUIREMENTS.—A comprehensive workplace wellness 

program shall be made available by an eligible employer to 

all employees and include the following components: 
H. R. 3590—860 

(A) Health awareness initiatives (including health education, preventive screenings, and health risk assessments). 

(B) Efforts to maximize employee engagement 

(including mechanisms to encourage employee participation). 

(C) Initiatives to change unhealthy behaviors and lifestyle choices (including counseling, seminars, online programs, and self-help materials). 

(D) Supportive environment efforts (including workplace policies to encourage healthy lifestyles, healthy 

eating, increased physical activity, and improved mental 

health). 

(d) APPLICATION.—An eligible employer desiring to participate 

in the grant program under this section shall submit an application 

to the Secretary, in such manner and containing such information 

as the Secretary may require, which shall include a proposal for 

a comprehensive workplace wellness program that meet the criteria 

and requirements described under subsection (c). 

(e) AUTHORIZATION OF APPROPRIATION.—For purposes of carrying out the grant program under this section, there is authorized 

to be appropriated $200,000,000 for the period of fiscal years 2011 

through 2015. Amounts appropriated pursuant to this subsection 

shall remain available until expended. 

SEC. 10409. CURES ACCELERATION NETWORK. 

(a) SHORT TITLE.—This section may be cited as the ‘‘Cures 

Acceleration Network Act of 2009’’. 

(b) REQUIREMENT FOR THE DIRECTOR OF NIH TO ESTABLISH

A CURES ACCELERATION NETWORK.—Section 402(b) of the Public 

Health Service Act (42 U.S.C. 282(b)) is amended— 

(1) in paragraph (22), by striking ‘‘and’’ at the end; 

(2) in paragraph (23), by striking the period and inserting 

‘‘; and’’; and 

(3) by inserting after paragraph (23), the following: 

‘‘(24) implement the Cures Acceleration Network described 

in section 402C.’’. 

(c) ACCEPTING GIFTS TO SUPPORT THE CURES ACCELERATION

NETWORK.—Section 499(c)(1) of the Public Health Service Act (42 

U.S.C. 290b(c)(1)) is amended by adding at the end the following: 

‘‘(E) The Cures Acceleration Network described in section 402C.’’. 

(d) ESTABLISHMENT OF THE CURES ACCELERATION NETWORK.— Part A of title IV of the Public Health Service Act is amended 

by inserting after section 402B (42 U.S.C. 282b) the following: 

‘‘SEC. 402C. CURES ACCELERATION NETWORK. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) BIOLOGICAL PRODUCT.—The term ‘biological product’ 

has the meaning given such term in section 351 of the Public 

Health Service Act. 

‘‘(2) DRUG; DEVICE.—The terms ‘drug’ and ‘device’ have 

the meanings given such terms in section 201 of the Federal 

Food, Drug, and Cosmetic Act. 

‘‘(3) HIGH NEED CURE.—The term ‘high need cure’ means 

a drug (as that term is defined by section 201(g)(1) of the 

Federal Food, Drug, and Cosmetic Act, biological product (as 

that term is defined by section 262(i)), or device (as that term 

is defined by section 201(h) of the Federal Food, Drug, and 
H. R. 3590—861 

Cosmetic Act) that, in the determination of the Director of 

NIH— 

‘‘(A) is a priority to diagnose, mitigate, prevent, or 

treat harm from any disease or condition; and 

‘‘(B) for which the incentives of the commercial market 

are unlikely to result in its adequate or timely development. 

‘‘(4) MEDICAL PRODUCT.—The term ‘medical product’ means 

a drug, device, biological product, or product that is a combination of drugs, devices, and biological products. 

‘‘(b) ESTABLISHMENT OF THE CURES ACCELERATION NETWORK.— Subject to the appropriation of funds as described in subsection 

(g), there is established within the Office of the Director of NIH 

a program to be known as the Cures Acceleration Network (referred 

to in this section as ‘CAN’), which shall— 

‘‘(1) be under the direction of the Director of NIH, taking 

into account the recommendations of a CAN Review Board 

(referred to in this section as the ‘Board’), described in subsection (d); and 

‘‘(2) award grants and contracts to eligible entities, as 

described in subsection (e), to accelerate the development of 

high need cures, including through the development of medical 

products and behavioral therapies. 

‘‘(c) FUNCTIONS.—The functions of the CAN are to— 

‘‘(1) conduct and support revolutionary advances in basic 

research, translating scientific discoveries from bench to bedside; 

‘‘(2) award grants and contracts to eligible entities to accelerate the development of high need cures; 

‘‘(3) provide the resources necessary for government agencies, independent investigators, research organizations, biotechnology companies, academic research institutions, and other 

entities to develop high need cures; 

‘‘(4) reduce the barriers between laboratory discoveries and 

clinical trials for new therapies; and 

‘‘(5) facilitate review in the Food and Drug Administration 

for the high need cures funded by the CAN, through activities 

that may include— 

‘‘(A) the facilitation of regular and ongoing communication with the Food and Drug Administration regarding 

the status of activities conducted under this section; 

‘‘(B) ensuring that such activities are coordinated with 

the approval requirements of the Food and Drug Administration, with the goal of expediting the development and 

approval of countermeasures and products; and 

‘‘(C) connecting interested persons with additional technical assistance made available under section 565 of the 

Federal Food, Drug, and Cosmetic Act. 

‘‘(d) CAN BOARD.— ‘‘(1) ESTABLISHMENT.—There is established a Cures Acceleration Network Review Board (referred to in this section as 

the ‘Board’), which shall advise the Director of NIH on the 

conduct of the activities of the Cures Acceleration Network. 

‘‘(2) MEMBERSHIP.— 

‘‘(A) IN GENERAL.— ‘‘(i) APPOINTMENT.—The Board shall be comprised 

of 24 members who are appointed by the Secretary 

and who serve at the pleasure of the Secretary. 
H. R. 3590—862 

‘‘(ii) CHAIRPERSON AND VICE CHAIRPERSON.—The 

Secretary shall designate, from among the 24 members 

appointed under clause (i), one Chairperson of the 

Board (referred to in this section as the ‘Chairperson’) 

and one Vice Chairperson. 

‘‘(B) TERMS.— 

‘‘(i) IN GENERAL.—Each member shall be appointed 

to serve a 4-year term, except that any member 

appointed to fill a vacancy occurring prior to the expiration of the term for which the member’s predecessor 

was appointed shall be appointed for the remainder 

of such term. 

‘‘(ii) CONSECUTIVE APPOINTMENTS; MAXIMUM

TERMS.—A member may be appointed to serve not 

more than 3 terms on the Board, and may not serve 

more than 2 such terms consecutively. 

‘‘(C) QUALIFICATIONS.— 

‘‘(i) IN GENERAL.—The Secretary shall appoint 

individuals to the Board based solely upon the individual’s established record of distinguished service in one 

of the areas of expertise described in clause (ii). Each 

individual appointed to the Board shall be of distinguished achievement and have a broad range of disciplinary interests. 

‘‘(ii) EXPERTISE.—The Secretary shall select 

individuals based upon the following requirements: 

‘‘(I) For each of the fields of— 

‘‘(aa) basic research; 

‘‘(bb) medicine; 

‘‘(cc) biopharmaceuticals; 

‘‘(dd) discovery and delivery of medical 

products; 

‘‘(ee) bioinformatics and gene therapy; 

‘‘(ff) medical instrumentation; and 

‘‘(gg) regulatory review and approval of 

medical products, 

the Secretary shall select at least 1 individual 

who is eminent in such fields. 

‘‘(II) At least 4 individuals shall be recognized 

leaders in professional venture capital or private 

equity organizations and have demonstrated 

experience in private equity investing. 

‘‘(III) At least 8 individuals shall represent 

disease advocacy organizations. 

‘‘(3) EX-OFFICIO MEMBERS.— 

‘‘(A) APPOINTMENT.—In addition to the 24 Board members described in paragraph (2), the Secretary shall appoint 

as ex-officio members of the Board— 

‘‘(i) a representative of the National Institutes of 

Health, recommended by the Secretary of the Department of Health and Human Services; 

‘‘(ii) a representative of the Office of the Assistant 

Secretary of Defense for Health Affairs, recommended 

by the Secretary of Defense; 
H. R. 3590—863 

‘‘(iii) a representative of the Office of the Under 

Secretary for Health for the Veterans Health Administration, recommended by the Secretary of Veterans 

Affairs; 

‘‘(iv) a representative of the National Science 

Foundation, recommended by the Chair of the National 

Science Board; and 

‘‘(v) a representative of the Food and Drug 

Administration, recommended by the Commissioner of 

Food and Drugs. 

‘‘(B) TERMS.—Each ex-officio member shall serve a 3- 

year term on the Board, except that the Chairperson may 

adjust the terms of the initial ex-officio members in order 

to provide for a staggered term of appointment for all 

such members. 

‘‘(4) RESPONSIBILITIES OF THE BOARD AND THE DIRECTOR

OF NIH.— 

‘‘(A) RESPONSIBILITIES OF THE BOARD.— 

‘‘(i) IN GENERAL.—The Board shall advise, and provide recommendations to, the Director of NIH with 

respect to— 

‘‘(I) policies, programs, and procedures for carrying out the duties of the Director of NIH under 

this section; and 

‘‘(II) significant barriers to successful translation of basic science into clinical application 

(including issues under the purview of other agencies and departments). 

‘‘(ii) REPORT.—In the case that the Board identifies 

a significant barrier, as described in clause (i)(II), the 

Board shall submit to the Secretary a report regarding 

such barrier. 

‘‘(B) RESPONSIBILITIES OF THE DIRECTOR OF NIH.—With 

respect to each recommendation provided by the Board 

under subparagraph (A)(i), the Director of NIH shall 

respond in writing to the Board, indicating whether such 

Director will implement such recommendation. In the case 

that the Director of NIH indicates a recommendation of 

the Board will not be implemented, such Director shall 

provide an explanation of the reasons for not implementing 

such recommendation. 

‘‘(5) MEETINGS.— 

‘‘(A) IN GENERAL.—The Board shall meet 4 times per 

calendar year, at the call of the Chairperson. 

‘‘(B) QUORUM; REQUIREMENTS; LIMITATIONS.— 

‘‘(i) QUORUM.—A quorum shall consist of a total 

of 13 members of the Board, excluding ex-officio members, with diverse representation as described in clause 

(iii). 

‘‘(ii) CHAIRPERSON OR VICE CHAIRPERSON.—Each 

meeting of the Board shall be attended by either the 

Chairperson or the Vice Chairperson. 

‘‘(iii) DIVERSE REPRESENTATION.—At each meeting 

of the Board, there shall be not less than one scientist, 

one representative of a disease advocacy organization, 

and one representative of a professional venture capital 

or private equity organization. 
H. R. 3590—864 

‘‘(6) COMPENSATION AND TRAVEL EXPENSES.— 

‘‘(A) COMPENSATION.—Members shall receive compensation at a rate to be fixed by the Chairperson but 

not to exceed a rate equal to the daily equivalent of the 

annual rate of basic pay prescribed for level IV of the 

Executive Schedule under section 5315 of title 5, United 

States Code, for each day (including travel time) during 

which the member is engaged in the performance of the 

duties of the Board. All members of the Board who are 

officers or employees of the United States shall serve without compensation in addition to that received for their 

services as officers or employees of the United States. 

‘‘(B) TRAVEL EXPENSES.—Members of the Board shall 

be allowed travel expenses, including per diem in lieu 

of subsistence, at rates authorized for persons employed 

intermittently by the Federal Government under section 

5703(b) of title 5, United States Code, while away from 

their homes or regular places of business in the performance of services for the Board. 

‘‘(e) GRANT PROGRAM.— 

‘‘(1) SUPPORTING INNOVATION.—To carry out the purposes 

described in this section, the Director of NIH shall award 

contracts, grants, or cooperative agreements to the entities 

described in paragraph (2), to— 

‘‘(A) promote innovation in technologies supporting the 

advanced research and development and production of high 

need cures, including through the development of medical 

products and behavioral therapies. 

‘‘(B) accelerate the development of high need cures, 

including through the development of medical products, 

behavioral therapies, and biomarkers that demonstrate the 

safety or effectiveness of medical products; or 

‘‘(C) help the award recipient establish protocols that 

comply with Food and Drug Administration standards and 

otherwise permit the recipient to meet regulatory requirements at all stages of development, manufacturing, review, 

approval, and safety surveillance of a medical product. 

‘‘(2) ELIGIBLE ENTITIES.—To receive assistance under paragraph (1), an entity shall— 

‘‘(A) be a public or private entity, which may include 

a private or public research institution, an institution of 

higher education, a medical center, a biotechnology company, a pharmaceutical company, a disease advocacy 

organization, a patient advocacy organization, or an academic research institution; 

‘‘(B) submit an application containing— 

‘‘(i) a detailed description of the project for which 

the entity seeks such grant or contract; 

‘‘(ii) a timetable for such project; 

‘‘(iii) an assurance that the entity will submit— 

‘‘(I) interim reports describing the entity’s— 

‘‘(aa) progress in carrying out the project; 

and 

‘‘(bb) compliance with all provisions of this 

section and conditions of receipt of such grant 

or contract; and 
H. R. 3590—865 

‘‘(II) a final report at the conclusion of the 

grant period, describing the outcomes of the 

project; and 

‘‘(iv) a description of the protocols the entity will 

follow to comply with Food and Drug Administration 

standards and regulatory requirements at all stages 

of development, manufacturing, review, approval, and 

safety surveillance of a medical product; and 

‘‘(C) provide such additional information as the Director 

of NIH may require. 

‘‘(3) AWARDS.— 

‘‘(A) THE CURES ACCELERATION PARTNERSHIP AWARDS.— 

‘‘(i) INITIAL AWARD AMOUNT.—Each award under 

this subparagraph shall be not more than $15,000,000 

per project for the first fiscal year for which the project 

is funded, which shall be payable in one payment. 

‘‘(ii) FUNDING IN SUBSEQUENT FISCAL YEARS.—An 

eligible entity receiving an award under clause (i) may 

apply for additional funding for such project by submitting to the Director of NIH the information required 

under subparagraphs (B) and (C) of paragraph (2). 

The Director may fund a project of such eligible entity 

in an amount not to exceed $15,000,000 for a fiscal 

year subsequent to the initial award under clause (i). 

‘‘(iii) MATCHING FUNDS.—As a condition for 

receiving an award under this subsection, an eligible 

entity shall contribute to the project non-Federal funds 

in the amount of $1 for every $3 awarded under clauses 

(i) and (ii), except that the Director of NIH may waive 

or modify such matching requirement in any case 

where the Director determines that the goals and objectives of this section cannot adequately be carried out 

unless such requirement is waived. 

‘‘(B) THE CURES ACCELERATION GRANT AWARDS.— 

‘‘(i) INITIAL AWARD AMOUNT.—Each award under 

this subparagraph shall be not more than $15,000,000 

per project for the first fiscal year for which the project 

is funded, which shall be payable in one payment. 

‘‘(ii) FUNDING IN SUBSEQUENT FISCAL YEARS.—An 

eligible entity receiving an award under clause (i) may 

apply for additional funding for such project by submitting to the Board the information required under subparagraphs (B) and (C) of paragraph (2). The Director 

of NIH may fund a project of such eligible entity in 

an amount not to exceed $15,000,000 for a fiscal year 

subsequent to the initial award under clause (i). 

‘‘(C) THE CURES ACCELERATION FLEXIBLE RESEARCH

AWARDS.—If the Director of NIH determines that the goals 

and objectives of this section cannot adequately be carried 

out through a contract, grant, or cooperative agreement, 

the Director of NIH shall have flexible research authority 

to use other transactions to fund projects in accordance 

with the terms and conditions of this section. Awards made 

under such flexible research authority for a fiscal year 

shall not exceed 20 percent of the total funds appropriated 

under subsection (g)(1) for such fiscal year. 
H. R. 3590—866 

‘‘(4) SUSPENSION OF AWARDS FOR DEFAULTS, NONCOMPLIANCE WITH PROVISIONS AND PLANS, AND DIVERSION OF FUNDS; 

REPAYMENT OF FUNDS.—The Director of NIH may suspend the 

award to any entity upon noncompliance by such entity with 

provisions and plans under this section or diversion of funds. 

‘‘(5) AUDITS.—The Director of NIH may enter into agreements with other entities to conduct periodic audits of the 

projects funded by grants or contracts awarded under this 

subsection. 

‘‘(6) CLOSEOUT PROCEDURES.—At the end of a grant or 

contract period, a recipient shall follow the closeout procedures 

under section 74.71 of title 45, Code of Federal Regulations 

(or any successor regulation). 

‘‘(7) REVIEW.—A determination by the Director of NIH as 

to whether a drug, device, or biological product is a high need 

cure (for purposes of subsection (a)(3)) shall not be subject 

to judicial review. 

‘‘(f) COMPETITIVE BASIS OF AWARDS.—Any grant, cooperative 

agreement, or contract awarded under this section shall be awarded 

on a competitive basis. 

‘‘(g) AUTHORIZATION OF APPROPRIATIONS.— 

‘‘(1) IN GENERAL.—For purposes of carrying out this section, 

there are authorized to be appropriated $500,000,000 for fiscal 

year 2010, and such sums as may be necessary for subsequent 

fiscal years. Funds appropriated under this section shall be 

available until expended. 

‘‘(2) LIMITATION ON USE OF FUNDS OTHERWISE APPROPRIATED.—No funds appropriated under this Act, other than 

funds appropriated under paragraph (1), may be allocated to 

the Cures Acceleration Network.’’. 

SEC. 10410. CENTERS OF EXCELLENCE FOR DEPRESSION. 

(a) SHORT TITLE.—This section may be cited as the ‘‘Establishing a Network of Health-Advancing National Centers of Excellence for Depression Act of 2009’’ or the ‘‘ENHANCED Act of 2009’’. 

(b) CENTERS OF EXCELLENCE FOR DEPRESSION.—Subpart 3 of 

part B of title V of the Public Health Service Act (42 U.S.C. 

290bb et seq.) is amended by inserting after section 520A the 

following: 

‘‘SEC. 520B. NATIONAL CENTERS OF EXCELLENCE FOR DEPRESSION. 

‘‘(a) DEPRESSIVE DISORDER DEFINED.—In this section, the term 

‘depressive disorder’ means a mental or brain disorder relating 

to depression, including major depression, bipolar disorder, and 

related mood disorders. 

‘‘(b) GRANT PROGRAM.— 

‘‘(1) IN GENERAL.—The Secretary, acting through the 

Administrator, shall award grants on a competitive basis to 

eligible entities to establish national centers of excellence for 

depression (referred to in this section as ‘Centers’), which shall 

engage in activities related to the treatment of depressive disorders. 

‘‘(2) ALLOCATION OF AWARDS.—If the funds authorized 

under subsection (f) are appropriated in the amounts provided 

for under such subsection, the Secretary shall allocate such 

amounts so that— 
H. R. 3590—867 

‘‘(A) not later than 1 year after the date of enactment 

of the ENHANCED Act of 2009, not more than 20 Centers 

may be established; and 

‘‘(B) not later than September 30, 2016, not more than 

30 Centers may be established. 

‘‘(3) GRANT PERIOD.— 

‘‘(A) IN GENERAL.—A grant awarded under this section 

shall be for a period of 5 years. 

‘‘(B) RENEWAL.—A grant awarded under subparagraph 

(A) may be renewed, on a competitive basis, for 1 additional 

5-year period, at the discretion of the Secretary. In determining whether to renew a grant, the Secretary shall consider the report cards issued under subsection (e)(2). 

‘‘(4) USE OF FUNDS.—Grant funds awarded under this subsection shall be used for the establishment and ongoing activities of the recipient of such funds. 

‘‘(5) ELIGIBLE ENTITIES.— 

‘‘(A) REQUIREMENTS.—To be eligible to receive a grant 

under this section, an entity shall— 

‘‘(i) be an institution of higher education or a public 

or private nonprofit research institution; and 

‘‘(ii) submit an application to the Secretary at such 

time and in such manner as the Secretary may require, 

as described in subparagraph (B). 

‘‘(B) APPLICATION.—An application described in 

subparagraph (A)(ii) shall include— 

‘‘(i) evidence that such entity— 

‘‘(I) provides, or is capable of coordinating with 

other entities to provide, comprehensive health 

services with a focus on mental health services 

and subspecialty expertise for depressive disorders; 

‘‘(II) collaborates with other mental health providers, as necessary, to address co-occurring 

mental illnesses; 

‘‘(III) is capable of training health professionals about mental health; and 

‘‘(ii) such other information, as the Secretary may 

require. 

‘‘(C) PRIORITIES.—In awarding grants under this section, the Secretary shall give priority to eligible entities 

that meet 1 or more of the following criteria: 

‘‘(i) Demonstrated capacity and expertise to serve 

the targeted population. 

‘‘(ii) Existing infrastructure or expertise to provide 

appropriate, evidence-based and culturally and linguistically competent services. 

‘‘(iii) A location in a geographic area with disproportionate numbers of underserved and at-risk 

populations in medically underserved areas and health 

professional shortage areas. 

‘‘(iv) Proposed innovative approaches for outreach 

to initiate or expand services. 

‘‘(v) Use of the most up-to-date science, practices, 

and interventions available. 

‘‘(vi) Demonstrated capacity to establish cooperative and collaborative agreements with community 

mental health centers and other community entities 
H. R. 3590—868 

to provide mental health, social, and human services 

to individuals with depressive disorders. 

‘‘(6) NATIONAL COORDINATING CENTER.— 

‘‘(A) IN GENERAL.—The Secretary, acting through the 

Administrator, shall designate 1 recipient of a grant under 

this section to be the coordinating center of excellence 

for depression (referred to in this section as the ‘coordinating center’). The Secretary shall select such coordinating 

center on a competitive basis, based upon the demonstrated 

capacity of such center to perform the duties described 

in subparagraph (C). 

‘‘(B) APPLICATION.—A Center that has been awarded 

a grant under paragraph (1) may apply for designation 

as the coordinating center by submitting an application 

to the Secretary at such time, in such manner, and containing such information as the Secretary may require. 

‘‘(C) DUTIES.—The coordinating center shall— 

‘‘(i) develop, administer, and coordinate the network of Centers under this section; 

‘‘(ii) oversee and coordinate the national database 

described in subsection (d); 

‘‘(iii) lead a strategy to disseminate the findings 

and activities of the Centers through such database; 

and 

‘‘(iv) serve as a liaison with the Administration, 

the National Registry of Evidence-based Programs and 

Practices of the Administration, and any Federal interagency or interagency forum on mental health. 

‘‘(7) MATCHING FUNDS.—The Secretary may not award a 

grant or contract under this section to an entity unless the 

entity agrees that it will make available (directly or through 

contributions from other public or private entities) non-Federal 

contributions toward the activities to be carried out under 

the grant or contract in an amount equal to $1 for each $5 

of Federal funds provided under the grant or contract. Such 

non-Federal matching funds may be provided directly or 

through donations from public or private entities and may 

be in cash or in-kind, fairly evaluated, including plant, equipment, or services. 

‘‘(c) ACTIVITIES OF THE CENTERS.—Each Center shall carry out 

the following activities: 

‘‘(1) GENERAL ACTIVITIES.—Each Center shall— 

‘‘(A) integrate basic, clinical, or health services interdisciplinary research and practice in the development, 

implementation, and dissemination of evidence-based interventions; 

‘‘(B) involve a broad cross-section of stakeholders, such 

as researchers, clinicians, consumers, families of consumers, and voluntary health organizations, to develop a 

research agenda and disseminate findings, and to provide 

support in the implementation of evidence-based practices; 

‘‘(C) provide training and technical assistance to mental 

health professionals, and engage in and disseminate 

translational research with a focus on meeting the needs 

of individuals with depressive disorders; and 
H. R. 3590—869 

‘‘(D) educate policy makers, employers, community 

leaders, and the public about depressive disorders to reduce 

stigma and raise awareness of treatments. 

‘‘(2) IMPROVED TREATMENT STANDARDS, CLINICAL GUIDELINES, DIAGNOSTIC PROTOCOLS, AND CARE COORDINATION PRACTICE.—Each Center shall collaborate with other Centers in 

the network to— 

‘‘(A) develop and implement treatment standards, clinical guidelines, and protocols that emphasize primary 

prevention, early intervention, treatment for, and recovery 

from, depressive disorders; 

‘‘(B) foster communication with other providers 

attending to co-occurring physical health conditions such 

as cardiovascular, diabetes, cancer, and substance abuse 

disorders; 

‘‘(C) leverage available community resources, develop 

and implement improved self-management programs, and, 

when appropriate, involve family and other providers of 

social support in the development and implementation of 

care plans; and 

‘‘(D) use electronic health records and telehealth technology to better coordinate and manage, and improve access 

to, care, as determined by the coordinating center. 

‘‘(3) TRANSLATIONAL RESEARCH THROUGH COLLABORATION

OF CENTERS AND COMMUNITY-BASED ORGANIZATIONS.—Each 

Center shall— 

‘‘(A) demonstrate effective use of a public-private partnership to foster collaborations among members of the network and community-based organizations such as community mental health centers and other social and human 

services providers; 

‘‘(B) expand interdisciplinary, translational, and 

patient-oriented research and treatment; and 

‘‘(C) coordinate with accredited academic programs to 

provide ongoing opportunities for the professional and continuing education of mental health providers. 

‘‘(d) NATIONAL DATABASE.— ‘‘(1) IN GENERAL.—The coordinating center shall establish 

and maintain a national, publicly available database to improve 

prevention programs, evidence-based interventions, and disease 

management programs for depressive disorders, using data collected from the Centers, as described in paragraph (2). 

‘‘(2) DATA COLLECTION.—Each Center shall submit data 

gathered at such center, as appropriate, to the coordinating 

center regarding— 

‘‘(A) the prevalence and incidence of depressive disorders; 

‘‘(B) the health and social outcomes of individuals with 

depressive disorders; 

‘‘(C) the effectiveness of interventions designed, tested, 

and evaluated; 

‘‘(D) other information, as the Secretary may require. 

‘‘(3) SUBMISSION OF DATA TO THE ADMINISTRATOR.—The 

coordinating center shall submit to the Administrator the data 

and financial information gathered under paragraph (2). 

‘‘(4) PUBLICATION USING DATA FROM THE DATABASE.—A 

Center, or an individual affiliated with a Center, may publish 
H. R. 3590—870 

findings using the data described in paragraph (2) only if such 

center submits such data to the coordinating center, as required 

under such paragraph. 

‘‘(e) ESTABLISHMENT OF STANDARDS; REPORT CARDS AND RECOMMENDATIONS; THIRD PARTY REVIEW.— 

‘‘(1) ESTABLISHMENT OF STANDARDS.—The Secretary, acting 

through the Administrator, shall establish performance standards for— 

‘‘(A) each Center; and 

‘‘(B) the network of Centers as a whole. 

‘‘(2) REPORT CARDS.—The Secretary, acting through the 

Administrator, shall— 

‘‘(A) for each Center, not later than 3 years after the 

date on which such center of excellence is established and 

annually thereafter, issue a report card to the coordinating 

center to rate the performance of such Center; and 

‘‘(B) not later than 3 years after the date on which 

the first grant is awarded under subsection (b)(1) and 

annually thereafter, issue a report card to Congress to 

rate the performance of the network of centers of excellence 

as a whole. 

‘‘(3) RECOMMENDATIONS.—Based upon the report cards 

described in paragraph (2), the Secretary shall, not later than 

September 30, 2015— 

‘‘(A) make recommendations to the Centers regarding 

improvements such centers shall make; and 

‘‘(B) make recommendations to Congress for expanding 

the Centers to serve individuals with other types of mental 

disorders. 

‘‘(4) THIRD PARTY REVIEW.—Not later than 3 years after 

the date on which the first grant is awarded under subsection 

(b)(1) and annually thereafter, the Secretary shall arrange for 

an independent third party to conduct an evaluation of the 

network of Centers to ensure that such centers are meeting 

the goals of this section. 

‘‘(f) AUTHORIZATION OF APPROPRIATIONS.— ‘‘(1) IN GENERAL.—To carry out this section, there are 

authorized to be appropriated— ‘‘(A) $100,000,000 for each of the fiscal years 2011 

through 2015; and ‘‘(B) $150,000,000 for each of the fiscal years 2016 

through 2020. 

‘‘(2) ALLOCATION OF FUNDS AUTHORIZED.—Of the amount 

appropriated under paragraph (1) for a fiscal year, the Secretary 

shall determine the allocation of each Center receiving a grant 

under this section, but in no case may the allocation be more 

than $5,000,000, except that the Secretary may allocate not 

more than $10,000,000 to the coordinating center.’’. 

SEC. 10411. PROGRAMS RELATING TO CONGENITAL HEART DISEASE. 

(a) SHORT TITLE.—This subtitle may be cited as the ‘‘Congenital 

Heart Futures Act’’. 

(b) PROGRAMS RELATING TO CONGENITAL HEART DISEASE.— 

(1) NATIONAL CONGENITAL HEART DISEASE SURVEILLANCE

SYSTEM.—Part P of title III of the Public Health Service Act 

(42 U.S.C. 280g et seq.), as amended by section 5405, is further 

amended by adding at the end the following: 
H. R. 3590—871 

‘‘SEC. 399V–2. NATIONAL CONGENITAL HEART DISEASE SURVEILLANCE 

SYSTEM. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Director 

of the Centers for Disease Control and Prevention, may— 

‘‘(1) enhance and expand infrastructure to track the epidemiology of congenital heart disease and to organize such 

information into a nationally-representative, population-based 

surveillance system that compiles data concerning actual occurrences of congenital heart disease, to be known as the ‘National 

Congenital Heart Disease Surveillance System’; or 

‘‘(2) award a grant to one eligible entity to undertake 

the activities described in paragraph (1). 

‘‘(b) PURPOSE.—The purpose of the Congenital Heart Disease 

Surveillance System shall be to facilitate further research into 

the types of health services patients use and to identify possible 

areas for educational outreach and prevention in accordance with 

standard practices of the Centers for Disease Control and Prevention. 

‘‘(c) CONTENT.—The Congenital Heart Disease Surveillance 

System— 

‘‘(1) may include information concerning the incidence and 

prevalence of congenital heart disease in the United States; 

‘‘(2) may be used to collect and store data on congenital 

heart disease, including data concerning— 

‘‘(A) demographic factors associated with congenital 

heart disease, such as age, race, ethnicity, sex, and family 

history of individuals who are diagnosed with the disease; 

‘‘(B) risk factors associated with the disease; 

‘‘(C) causation of the disease; 

‘‘(D) treatment approaches; and 

‘‘(E) outcome measures, such that analysis of the outcome measures will allow derivation of evidence-based best 

practices and guidelines for congenital heart disease 

patients; and 

‘‘(3) may ensure the collection and analysis of longitudinal 

data related to individuals of all ages with congenital heart 

disease, including infants, young children, adolescents, and 

adults of all ages. 

‘‘(d) PUBLIC ACCESS.—The Congenital Heart Disease Surveillance System shall be made available to the public, as appropriate, 

including congenital heart disease researchers. 

‘‘(e) PATIENT PRIVACY.—The Secretary shall ensure that the 

Congenital Heart Disease Surveillance System is maintained in 

a manner that complies with the regulations promulgated under 

section 264 of the Health Insurance Portability and Accountability 

Act of 1996. 

‘‘(f) ELIGIBILITY FOR GRANT.—To be eligible to receive a grant 

under subsection (a)(2), an entity shall— 

‘‘(1) be a public or private nonprofit entity with specialized 

experience in congenital heart disease; and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require.’’. 

(2) CONGENITAL HEART DISEASE RESEARCH.—Subpart 2 of 

part C of title IV of the Public Health Service Act (42 U.S.C. 

285b et seq.) is amended by adding at the end the following: 
H. R. 3590—872 

‘‘SEC. 425. CONGENITAL HEART DISEASE. 

‘‘(a) IN GENERAL.—The Director of the Institute may expand, 

intensify, and coordinate research and related activities of the 

Institute with respect to congenital heart disease, which may 

include congenital heart disease research with respect to— 

‘‘(1) causation of congenital heart disease, including genetic 

causes; 

‘‘(2) long-term outcomes in individuals with congenital 

heart disease, including infants, children, teenagers, adults, 

and elderly individuals; 

‘‘(3) diagnosis, treatment, and prevention; 

‘‘(4) studies using longitudinal data and retrospective analysis to identify effective treatments and outcomes for individuals with congenital heart disease; and 

‘‘(5) identifying barriers to life-long care for individuals 

with congenital heart disease. 

‘‘(b) COORDINATION OF RESEARCH ACTIVITIES.—The Director of 

the Institute may coordinate research efforts related to congenital 

heart disease among multiple research institutions and may develop 

research networks. 

‘‘(c) MINORITY AND MEDICALLY UNDERSERVED COMMUNITIES.— 

In carrying out the activities described in this section, the Director 

of the Institute shall consider the application of such research 

and other activities to minority and medically underserved communities.’’. 

(c) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out the amendments made by this 

section such sums as may be necessary for each of fiscal years 

2011 through 2015. 

SEC. 10412. AUTOMATED DEFIBRILLATION IN ADAM’S MEMORY ACT. 

Section 312 of the Public Health Service Act (42 U.S.C. 244) 

is amended— 

(1) in subsection (c)(6), after ‘‘clearinghouse’’ insert ‘‘, that 

shall be administered by an organization that has substantial 

expertise in pediatric education, pediatric medicine, and 

electrophysiology and sudden death,’’; and 

(2) in the first sentence of subsection (e), by striking ‘‘fiscal 

year 2003’’ and all that follows through ‘‘2006’’ and inserting 

‘‘for each of fiscal years 2003 through 2014’’. 

SEC. 10413. YOUNG WOMEN’S BREAST HEALTH AWARENESS AND SUPPORT OF YOUNG WOMEN DIAGNOSED WITH BREAST 

CANCER. 

(a) SHORT TITLE.—This section may be cited as the ‘‘Young 

Women’s Breast Health Education and Awareness Requires 

Learning Young Act of 2009’’ or the ‘‘EARLY Act’’. 

(b) AMENDMENT.—Title III of the Public Health Service Act 

(42 U.S.C. 241 et seq.), as amended by this Act, is further amended 

by adding at the end the following: 
H. R. 3590—873 

‘‘PART V—PROGRAMS RELATING TO BREAST 

HEALTH AND CANCER 

‘‘SEC. 399NN. YOUNG WOMEN’S BREAST HEALTH AWARENESS AND SUPPORT OF YOUNG WOMEN DIAGNOSED WITH BREAST 

CANCER. 

‘‘(a) PUBLIC EDUCATION CAMPAIGN.— 

‘‘(1) IN GENERAL.—The Secretary, acting through the 

Director of the Centers for Disease Control and Prevention, 

shall conduct a national evidence-based education campaign 

to increase awareness of young women’s knowledge regarding— 

‘‘(A) breast health in young women of all racial, ethnic, 

and cultural backgrounds; 

‘‘(B) breast awareness and good breast health habits; 

‘‘(C) the occurrence of breast cancer and the general 

and specific risk factors in women who may be at high 

risk for breast cancer based on familial, racial, ethnic, 

and cultural backgrounds such as Ashkenazi Jewish populations; 

‘‘(D) evidence-based information that would encourage 

young women and their health care professional to increase 

early detection of breast cancers; and 

‘‘(E) the availability of health information and other 

resources for young women diagnosed with breast cancer. 

‘‘(2) EVIDENCE-BASED, AGE APPROPRIATE MESSAGES.—The 

campaign shall provide evidence-based, age-appropriate messages and materials as developed by the Centers for Disease 

Control and Prevention and the Advisory Committee established under paragraph (4). 

‘‘(3) MEDIA CAMPAIGN.—In conducting the education campaign under paragraph (1), the Secretary shall award grants 

to entities to establish national multimedia campaigns oriented 

to young women that may include advertising through television, radio, print media, billboards, posters, all forms of 

existing and especially emerging social networking media, other 

Internet media, and any other medium determined appropriate 

by the Secretary. 

‘‘(4) ADVISORY COMMITTEE.— 

‘‘(A) ESTABLISHMENT.—Not later than 60 days after 

the date of the enactment of this section, the Secretary, 

acting through the Director of the Centers for Disease 

Control and Prevention, shall establish an advisory committee to assist in creating and conducting the education 

campaigns under paragraph (1) and subsection (b)(1). 

‘‘(B) MEMBERSHIP.—The Secretary, acting through the 

Director of the Centers for Disease Control and Prevention, 

shall appoint to the advisory committee under subparagraph (A) such members as deemed necessary to properly 

advise the Secretary, and shall include organizations and 

individuals with expertise in breast cancer, disease prevention, early detection, diagnosis, public health, social marketing, genetic screening and counseling, treatment, 

rehabilitation, palliative care, and survivorship in young 

women. 

‘‘(b) HEALTH CARE PROFESSIONAL EDUCATION CAMPAIGN.—The 

Secretary, acting through the Director of the Centers for Disease 
H. R. 3590—874 

Control and Prevention, and in consultation with the Administrator 

of the Health Resources and Services Administration, shall conduct 

an education campaign among physicians and other health care 

professionals to increase awareness— 

‘‘(1) of breast health, symptoms, and early diagnosis and 

treatment of breast cancer in young women, including specific 

risk factors such as family history of cancer and women that 

may be at high risk for breast cancer, such as Ashkenazi 

Jewish population; 

‘‘(2) on how to provide counseling to young women about 

their breast health, including knowledge of their family cancer 

history and importance of providing regular clinical breast 

examinations; 

‘‘(3) concerning the importance of discussing healthy behaviors, and increasing awareness of services and programs available to address overall health and wellness, and making patient 

referrals to address tobacco cessation, good nutrition, and physical activity; 

‘‘(4) on when to refer patients to a health care provider 

with genetics expertise; 

‘‘(5) on how to provide counseling that addresses longterm survivorship and health concerns of young women 

diagnosed with breast cancer; and 

‘‘(6) on when to provide referrals to organizations and 

institutions that provide credible health information and substantive assistance and support to young women diagnosed 

with breast cancer. 

‘‘(c) PREVENTION RESEARCH ACTIVITIES.—The Secretary, acting 

through— 

‘‘(1) the Director of the Centers for Disease Control and 

Prevention, shall conduct prevention research on breast cancer 

in younger women, including— 

‘‘(A) behavioral, survivorship studies, and other 

research on the impact of breast cancer diagnosis on young 

women; 

‘‘(B) formative research to assist with the development 

of educational messages and information for the public, 

targeted populations, and their families about breast 

health, breast cancer, and healthy lifestyles; 

‘‘(C) testing and evaluating existing and new social 

marketing strategies targeted at young women; and 

‘‘(D) surveys of health care providers and the public 

regarding knowledge, attitudes, and practices related to 

breast health and breast cancer prevention and control 

in high-risk populations; and 

‘‘(2) the Director of the National Institutes of Health, shall 

conduct research to develop and validate new screening tests 

and methods for prevention and early detection of breast cancer 

in young women. 

‘‘(d) SUPPORT FOR YOUNG WOMEN DIAGNOSED WITH BREAST

CANCER.— 

‘‘(1) IN GENERAL.—The Secretary shall award grants to 

organizations and institutions to provide health information 

from credible sources and substantive assistance directed to 

young women diagnosed with breast cancer and pre-neoplastic 

breast diseases. 
H. R. 3590—875 

‘‘(2) PRIORITY.—In making grants under paragraph (1), the 

Secretary shall give priority to applicants that deal specifically 

with young women diagnosed with breast cancer and pre-neoplastic breast disease. 

‘‘(e) NO DUPLICATION OF EFFORT.—In conducting an education 

campaign or other program under subsections (a), (b), (c), or (d), 

the Secretary shall avoid duplicating other existing Federal breast 

cancer education efforts. 

‘‘(f) MEASUREMENT; REPORTING.—The Secretary, acting through 

the Director of the Centers for Disease Control and Prevention, 

shall— 

‘‘(1) measure— 

‘‘(A) young women’s awareness regarding breast health, 

including knowledge of family cancer history, specific risk 

factors and early warning signs, and young women’s 

proactive efforts at early detection; 

‘‘(B) the number or percentage of young women utilizing information regarding lifestyle interventions that 

foster healthy behaviors; 

‘‘(C) the number or percentage of young women 

receiving regular clinical breast exams; and 

‘‘(D) the number or percentage of young women who 

perform breast self exams, and the frequency of such 

exams, before the implementation of this section; 

‘‘(2) not less than every 3 years, measure the impact of 

such activities; and 

‘‘(3) submit reports to the Congress on the results of such 

measurements. 

‘‘(g) DEFINITION.—In this section, the term ‘young women’ 

means women 15 to 44 years of age. 

‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—To carry out subsections (a), (b), (c)(1), and (d), there are authorized to be appropriated $9,000,000 for each of the fiscal years 2010 through 2014.’’. 

Subtitle E—Provisions Relating to Title V 

SEC. 10501. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT, THE 

SOCIAL SECURITY ACT, AND TITLE V OF THIS ACT. 

(a) Section 5101 of this Act is amended— 

(1) in subsection (c)(2)(B)(i)(II), by inserting ‘‘, including 

representatives of small business and self-employed individuals’’ after ‘‘employers’’; 

(2) in subsection (d)(4)(A)— 

(A) by redesignating clause (iv) as clause (v); and 

(B) by inserting after clause (iii) the following: 

‘‘(iv) An analysis of, and recommendations for, 

eliminating the barriers to entering and staying in 

primary care, including provider compensation.’’; and 

(3) in subsection (i)(2)(B), by inserting ‘‘optometrists, 

ophthalmologists,’’ after ‘‘occupational therapists,’’. 

(b) Subtitle B of title V of this Act is amended by adding 

at the end the following: 
H. R. 3590—876 

‘‘SEC. 5104. INTERAGENCY TASK FORCE TO ASSESS AND IMPROVE 

ACCESS TO HEALTH CARE IN THE STATE OF ALASKA. 

‘‘(a) ESTABLISHMENT.—There is established a task force to be 

known as the ‘Interagency Access to Health Care in Alaska Task 

Force’ (referred to in this section as the ‘Task Force’). 

‘‘(b) DUTIES.—The Task Force shall— 

‘‘(1) assess access to health care for beneficiaries of Federal 

health care systems in Alaska; and 

‘‘(2) develop a strategy for the Federal Government to 

improve delivery of health care to Federal beneficiaries in the 

State of Alaska. 

‘‘(c) MEMBERSHIP.—The Task Force shall be comprised of Federal members who shall be appointed, not later than 45 days 

after the date of enactment of this Act, as follows: 

‘‘(1) The Secretary of Health and Human Services shall 

appoint one representative of each of the following: 

‘‘(A) The Department of Health and Human Services. 

‘‘(B) The Centers for Medicare and Medicaid Services. 

‘‘(C) The Indian Health Service. 

‘‘(2) The Secretary of Defense shall appoint one representative of the TRICARE Management Activity. 

‘‘(3) The Secretary of the Army shall appoint one representative of the Army Medical Department. 

‘‘(4) The Secretary of the Air Force shall appoint one representative of the Air Force, from among officers at the Air 

Force performing medical service functions. 

‘‘(5) The Secretary of Veterans Affairs shall appoint one 

representative of each of the following: 

‘‘(A) The Department of Veterans Affairs. 

‘‘(B) The Veterans Health Administration. 

‘‘(6) The Secretary of Homeland Security shall appoint one 

representative of the United States Coast Guard. 

‘‘(d) CHAIRPERSON.—One chairperson of the Task Force shall 

be appointed by the Secretary at the time of appointment of members under subsection (c), selected from among the members 

appointed under paragraph (1). 

‘‘(e) MEETINGS.—The Task Force shall meet at the call of the 

chairperson. 

‘‘(f) REPORT.—Not later than 180 days after the date of enactment of this Act, the Task Force shall submit to Congress a report 

detailing the activities of the Task Force and containing the 

findings, strategies, recommendations, policies, and initiatives 

developed pursuant to the duty described in subsection (b)(2). In 

preparing such report, the Task Force shall consider completed 

and ongoing efforts by Federal agencies to improve access to health 

care in the State of Alaska. 

‘‘(g) TERMINATION.—The Task Force shall be terminated on 

the date of submission of the report described in subsection (f).’’. 

(c) Section 399V of the Public Health Service Act, as added 

by section 5313, is amended— 

(1) in subsection (b)(4), by striking ‘‘identify, educate, refer, 

and enroll’’ and inserting ‘‘identify and refer’’; and 

(2) in subsection (k)(1), by striking ‘‘, as defined by the 

Department of Labor as Standard Occupational Classification 

[21–1094]’’. 
H. R. 3590—877 

(d) Section 738(a)(3) of the Public Health Service Act (42 U.S.C. 

293b(a)(3)) is amended by inserting ‘‘schools offering physician 

assistant education programs,’’ after ‘‘public health,’’. 

(e) Subtitle D of title V of this Act is amended by adding 

at the end the following: 

‘‘SEC. 5316. DEMONSTRATION GRANTS FOR FAMILY NURSE PRACTITIONER TRAINING PROGRAMS. 

‘‘(a) ESTABLISHMENT OF PROGRAM.—The Secretary of Health 

and Human Services (referred to in this section as the ‘Secretary’) 

shall establish a training demonstration program for family nurse 

practitioners (referred to in this section as the ‘program’) to employ 

and provide 1-year training for nurse practitioners who have graduated from a nurse practitioner program for careers as primary 

care providers in Federally qualified health centers (referred to 

in this section as ‘FQHCs’) and nurse-managed health clinics 

(referred to in this section as ‘NMHCs’). 

‘‘(b) PURPOSE.—The purpose of the program is to enable each 

grant recipient to— 

‘‘(1) provide new nurse practitioners with clinical training 

to enable them to serve as primary care providers in FQHCs 

and NMHCs; 

‘‘(2) train new nurse practitioners to work under a model 

of primary care that is consistent with the principles set forth 

by the Institute of Medicine and the needs of vulnerable populations; and 

‘‘(3) create a model of FQHC and NMHC training for nurse 

practitioners that may be replicated nationwide. 

‘‘(c) GRANTS.—The Secretary shall award 3-year grants to 

eligible entities that meet the requirements established by the 

Secretary, for the purpose of operating the nurse practitioner primary care programs described in subsection (a) in such entities. 

‘‘(d) ELIGIBLE ENTITIES.—To be eligible to receive a grant under 

this section, an entity shall— 

‘‘(1)(A) be a FQHC as defined in section 1861(aa) of the 

Social Security Act (42 U.S.C. 1395x(aa)); or 

‘‘(B) be a nurse-managed health clinic, as defined in section 

330A–1 of the Public Health Service Act (as added by section 

5208 of this Act); and 

‘‘(2) submit to the Secretary an application at such time, 

in such manner, and containing such information as the Secretary may require. 

‘‘(e) PRIORITY IN AWARDING GRANTS.—In awarding grants under 

this section, the Secretary shall give priority to eligible entities 

that— 

‘‘(1) demonstrate sufficient infrastructure in size, scope, 

and capacity to undertake the requisite training of a minimum 

of 3 nurse practitioners per year, and to provide to each awardee 

12 full months of full-time, paid employment and benefits consistent with the benefits offered to other full-time employees 

of such entity; 

‘‘(2) will assign not less than 1 staff nurse practitioner 

or physician to each of 4 precepted clinics; 

‘‘(3) will provide to each awardee specialty rotations, 

including specialty training in prenatal care and women’s 

health, adult and child psychiatry, orthopedics, geriatrics, and 

at least 3 other high-volume, high-burden specialty areas; 
H. R. 3590—878 

‘‘(4) provide sessions on high-volume, high-risk health problems and have a record of training health care professionals 

in the care of children, older adults, and underserved populations; and 

‘‘(5) collaborate with other safety net providers, schools, 

colleges, and universities that provide health professions 

training. 

‘‘(f) ELIGIBILITY OF NURSE PRACTITIONERS.— 

‘‘(1) IN GENERAL.—To be eligible for acceptance to a program funded through a grant awarded under this section, an 

individual shall— 

‘‘(A) be licensed or eligible for licensure in the State 

in which the program is located as an advanced practice 

registered nurse or advanced practice nurse and be eligible 

or board-certified as a family nurse practitioner; and 

‘‘(B) demonstrate commitment to a career as a primary 

care provider in a FQHC or in a NMHC. 

‘‘(2) PREFERENCE.—In selecting awardees under the program, each grant recipient shall give preference to bilingual 

candidates that meet the requirements described in paragraph 

(1). 

‘‘(3) DEFERRAL OF CERTAIN SERVICE.—The starting date 

of required service of individuals in the National Health Service 

Corps Service program under title II of the Public Health 

Service Act (42 U.S.C. 202 et seq.) who receive training under 

this section shall be deferred until the date that is 22 days 

after the date of completion of the program. 

‘‘(g) GRANT AMOUNT.—Each grant awarded under this section shall be in an amount not to exceed $600,000 per year. A grant 

recipient may carry over funds from 1 fiscal year to another without 

obtaining approval from the Secretary. 

‘‘(h) TECHNICAL ASSISTANCE GRANTS.—The Secretary may 

award technical assistance grants to 1 or more FQHCs or NMHCs 

that have demonstrated expertise in establishing a nurse practitioner residency training program. Such technical assistance grants 

shall be for the purpose of providing technical assistance to other 

recipients of grants under subsection (c). 

‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—To carry out this section, there is authorized to be appropriated such sums as may 

be necessary for each of fiscal years 2011 through 2014.’’. 

(f)(1) Section 399W of the Public Health Service Act, as added 

by section 5405, is redesignated as section 399V–1. 

(2) Section 399V–1 of the Public Health Service Act, as so 

redesignated, is amended in subsection (b)(2)(A) by striking ‘‘and 

the departments of 1 or more health professions schools in the 

State that train providers in primary care’’ and inserting ‘‘and 

the departments that train providers in primary care in 1 or more 

health professions schools in the State’’. 

(3) Section 934 of the Public Health Service Act, as added 

by section 3501, is amended by striking ‘‘399W’’ each place such 

term appears and inserting ‘‘399V–1’’. 

(4) Section 935(b) of the Public Health Service Act, as added 

by section 3503, is amended by striking ‘‘399W’’ and inserting 

‘‘399V–1’’. 

(g) Part P of title III of the Public Health Service Act 42 

U.S.C. 280g et seq.), as amended by section 10411, is amended 

by adding at the end the following: 
H. R. 3590—879 

‘‘SEC. 399V–3. NATIONAL DIABETES PREVENTION PROGRAM. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Director 

of the Centers for Disease Control and Prevention, shall establish 

a national diabetes prevention program (referred to in this section 

as the ‘program’) targeted at adults at high risk for diabetes in 

order to eliminate the preventable burden of diabetes. 

‘‘(b) PROGRAM ACTIVITIES.—The program described in subsection (a) shall include— 

‘‘(1) a grant program for community-based diabetes prevention program model sites; 

‘‘(2) a program within the Centers for Disease Control 

and Prevention to determine eligibility of entities to deliver 

community-based diabetes prevention services; 

‘‘(3) a training and outreach program for lifestyle intervention instructors; and 

‘‘(4) evaluation, monitoring and technical assistance, and 

applied research carried out by the Centers for Disease Control 

and Prevention. 

‘‘(c) ELIGIBLE ENTITIES.—To be eligible for a grant under subsection (b)(1), an entity shall be a State or local health department, 

a tribal organization, a national network of community-based nonprofits focused on health and wellbeing, an academic institution, 

or other entity, as the Secretary determines. 

‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—For the purpose of 

carrying out this section, there are authorized to be appropriated 

such sums as may be necessary for each of fiscal years 2010 through 

2014.’’. 

(h) The provisions of, and amendment made by, section 5501(c) 

of this Act are repealed. 

(i)(1) The provisions of, and amendments made by, section 

5502 of this Act are repealed. 

(2)(A) Section 1861(aa)(3)(A) of the Social Security Act (42 

U.S.C. 1395w(aa)(3)(A)) is amended to read as follows: 

‘‘(A) services of the type described in subparagraphs (A) 

through (C) of paragraph (1) and preventive services (as defined 

in section 1861(ddd)(3)); and’’. 

(B) The amendment made by subparagraph (A) shall apply 

to services furnished on or after January 1, 2011. 

(3)(A) Section 1834 of the Social Security Act (42 U.S.C. 1395m), 

as amended by section 4105, is amended by adding at the end 

the following new subsection: 

‘‘(o) DEVELOPMENT AND IMPLEMENTATION OF PROSPECTIVE PAYMENT SYSTEM.— 

‘‘(1) DEVELOPMENT.— 

‘‘(A) IN GENERAL.—The Secretary shall develop a 

prospective payment system for payment for Federally 

qualified health center services furnished by Federally 

qualified health centers under this title. Such system shall 

include a process for appropriately describing the services 

furnished by Federally qualified health centers and shall 

establish payment rates for specific payment codes based 

on such appropriate descriptions of services. Such system 

shall be established to take into account the type, intensity, 

and duration of services furnished by Federally qualified 

health centers. Such system may include adjustments, 

including geographic adjustments, determined appropriate 

by the Secretary. 
H. R. 3590—880 

‘‘(B) COLLECTION OF DATA AND EVALUATION.—By not 

later than January 1, 2011, the Secretary shall require 

Federally qualified health centers to submit to the Secretary such information as the Secretary may require in 

order to develop and implement the prospective payment 

system under this subsection, including the reporting of 

services using HCPCS codes. 

‘‘(2) IMPLEMENTATION.— 

‘‘(A) IN GENERAL.—Notwithstanding section 

1833(a)(3)(A), the Secretary shall provide, for cost reporting 

periods beginning on or after October 1, 2014, for payments 

of prospective payment rates for Federally qualified health 

center services furnished by Federally qualified health centers under this title in accordance with the prospective 

payment system developed by the Secretary under paragraph (1). 

‘‘(B) PAYMENTS.— 

‘‘(i) INITIAL PAYMENTS.—The Secretary shall implement such prospective payment system so that the 

estimated aggregate amount of prospective payment 

rates (determined prior to the application of section 

1833(a)(1)(Z)) under this title for Federally qualified 

health center services in the first year that such system 

is implemented is equal to 100 percent of the estimated 

amount of reasonable costs (determined without the 

application of a per visit payment limit or productivity 

screen and prior to the application of section 

1866(a)(2)(A)(ii)) that would have occurred for such 

services under this title in such year if the system 

had not been implemented. 

‘‘(ii) PAYMENTS IN SUBSEQUENT YEARS.—Payment 

rates in years after the year of implementation of 

such system shall be the payment rates in the previous 

year increased— 

‘‘(I) in the first year after implementation of 

such system, by the percentage increase in the 

MEI (as defined in section 1842(i)(3)) for the year 

involved; and 

‘‘(II) in subsequent years, by the percentage 

increase in a market basket of Federally qualified 

health center goods and services as promulgated 

through regulations, or if such an index is not 

available, by the percentage increase in the MEI 

(as defined in section 1842(i)(3)) for the year 

involved. 

‘‘(C) PREPARATION FOR PPS IMPLEMENTATION.—Notwithstanding any other provision of law, the Secretary may 

establish and implement by program instruction or otherwise the payment codes to be used under the prospective 

payment system under this section.’’. 

(B) Section 1833(a)(1) of the Social Security Act (42 U.S.C. 

1395l(a)(1)), as amended by section 4104, is amended— 

(i) by striking ‘‘and’’ before ‘‘(Y)’’; and 

(ii) by inserting before the semicolon at the end the following: ‘‘, and (Z) with respect to Federally qualified health 

center services for which payment is made under section 

1834(o), the amounts paid shall be 80 percent of the lesser 
H. R. 3590—881 

of the actual charge or the amount determined under such 

section’’. 

(C) Section 1833(a) of the Social Security Act (42 U.S.C. 

1395l(a)) is amended— 

(i) in paragraph (3)(B)(i)— 

(I) by inserting ‘‘(I)’’ after ‘‘otherwise been provided’’; 

and 

(II) by inserting ‘‘, or (II) in the case of such services 

furnished on or after the implementation date of the 

prospective payment system under section 1834(o), under 

such section (calculated as if ‘100 percent’ were substituted 

for ‘80 percent’ in such section) for such services if the 

individual had not been so enrolled’’ after ‘‘been so 

enrolled’’; and 

(ii) by adding at the end the following flush sentence: 

‘‘Paragraph (3)(A) shall not apply to Federally qualified health 

center services furnished on or after the implementation date 

of the prospective payment system under section 1834(0).’’. 

(j) Section 5505 is amended by adding at the end the following 

new subsection: 

‘‘(d) APPLICATION.—The amendments made by this section shall 

not be applied in a manner that requires reopening of any settled 

cost reports as to which there is not a jurisdictionally proper appeal 

pending as of the date of the enactment of this Act on the issue 

of payment for indirect costs of medical education under section 

1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) 

or for direct graduate medical education costs under section 1886(h) 

of such Act (42 U.S.C. 1395ww(h)).’’. 

(k) Subtitle G of title V of this Act is amended by adding 

at the end the following: 

‘‘SEC. 5606. STATE GRANTS TO HEALTH CARE PROVIDERS WHO PROVIDE SERVICES TO A HIGH PERCENTAGE OF MEDICALLY 

UNDERSERVED POPULATIONS OR OTHER SPECIAL POPULATIONS. 

‘‘(a) IN GENERAL.—A State may award grants to health care 

providers who treat a high percentage, as determined by such 

State, of medically underserved populations or other special populations in such State. 

‘‘(b) SOURCE OF FUNDS.—A grant program established by a 

State under subsection (a) may not be established within a department, agency, or other entity of such State that administers the 

Medicaid program under title XIX of the Social Security Act (42 

U.S.C. 1396 et seq.), and no Federal or State funds allocated to 

such Medicaid program, the Medicare program under title XVIII 

of the Social Security Act (42 U.S.C. 1395 et seq.), or the TRICARE 

program under chapter 55 of title 10, United States Code, may 

be used to award grants or to pay administrative costs associated 

with a grant program established under subsection (a).’’. 

(l) Part C of title VII of the Public Health Service Act (42 

U.S.C. 293k et seq.) is amended— 

(1) after the part heading, by inserting the following: 

‘‘Subpart I—Medical Training Generally’’; 

and 

(2) by inserting at the end the following: 
H. R. 3590—882 

‘‘Subpart II—Training in Underserved 

Communities 

‘‘SEC. 749B. RURAL PHYSICIAN TRAINING GRANTS. 

‘‘(a) IN GENERAL.—The Secretary, acting through the Administrator of the Health Resources and Services Administration, shall 

establish a grant program for the purposes of assisting eligible 

entities in recruiting students most likely to practice medicine 

in underserved rural communities, providing rural-focused training 

and experience, and increasing the number of recent allopathic 

and osteopathic medical school graduates who practice in underserved rural communities. 

‘‘(b) ELIGIBLE ENTITIES.—In order to be eligible to receive a 

grant under this section, an entity shall— 

‘‘(1) be a school of allopathic or osteopathic medicine accredited by a nationally recognized accrediting agency or association 

approved by the Secretary for this purpose, or any combination 

or consortium of such schools; and 

‘‘(2) submit an application to the Secretary that includes 

a certification that such entity will use amounts provided to 

the institution as described in subsection (d)(1). 

‘‘(c) PRIORITY.—In awarding grant funds under this section, 

the Secretary shall give priority to eligible entities that— 

‘‘(1) demonstrate a record of successfully training students, 

as determined by the Secretary, who practice medicine in underserved rural communities; 

‘‘(2) demonstrate that an existing academic program of 

the eligible entity produces a high percentage, as determined 

by the Secretary, of graduates from such program who practice 

medicine in underserved rural communities; 

‘‘(3) demonstrate rural community institutional partnerships, through such mechanisms as matching or contributory 

funding, documented in-kind services for implementation, or 

existence of training partners with interprofessional expertise 

in community health center training locations or other similar 

facilities; or 

‘‘(4) submit, as part of the application of the entity under 

subsection (b), a plan for the long-term tracking of where the 

graduates of such entity practice medicine. 

‘‘(d) USE OF FUNDS.— 

‘‘(1) ESTABLISHMENT.—An eligible entity receiving a grant 

under this section shall use the funds made available under 

such grant to establish, improve, or expand a rural-focused 

training program (referred to in this section as the ‘Program’) 

meeting the requirements described in this subsection and to 

carry out such program. 

‘‘(2) STRUCTURE OF PROGRAM.—An eligible entity shall— 

‘‘(A) enroll no fewer than 10 students per class year 

into the Program; and 

‘‘(B) develop criteria for admission to the Program that 

gives priority to students— 

‘‘(i) who have originated from or lived for a period 

of 2 or more years in an underserved rural community; 

and 

‘‘(ii) who express a commitment to practice medicine in an underserved rural community. 
H. R. 3590—883 

‘‘(3) CURRICULA.—The Program shall require students to 

enroll in didactic coursework and clinical experience particularly applicable to medical practice in underserved rural 

communities, including— 

‘‘(A) clinical rotations in underserved rural communities, and in applicable specialties, or other coursework 

or clinical experience deemed appropriate by the Secretary; 

and 

‘‘(B) in addition to core school curricula, additional 

coursework or training experiences focused on medical 

issues prevalent in underserved rural communities. 

‘‘(4) RESIDENCY PLACEMENT ASSISTANCE.—Where available, 

the Program shall assist all students of the Program in 

obtaining clinical training experiences in locations with postgraduate programs offering residency training opportunities in 

underserved rural communities, or in local residency training 

programs that support and train physicians to practice in 

underserved rural communities. 

‘‘(5) PROGRAM STUDENT COHORT SUPPORT.—The Program 

shall provide and require all students of the Program to participate in group activities designed to further develop, maintain, 

and reinforce the original commitment of such students to 

practice in an underserved rural community. 

‘‘(e) ANNUAL REPORTING.—An eligible entity receiving a grant 

under this section shall submit an annual report to the Secretary 

on the success of the Program, based on criteria the Secretary 

determines appropriate, including the residency program selection 

of graduating students who participated in the Program. 

‘‘(f) REGULATIONS.—Not later than 60 days after the date of 

enactment of this section, the Secretary shall by regulation define 

‘underserved rural community’ for purposes of this section. 

‘‘(g) SUPPLEMENT NOT SUPPLANT.—Any eligible entity receiving 

funds under this section shall use such funds to supplement, not 

supplant, any other Federal, State, and local funds that would 

otherwise be expended by such entity to carry out the activities 

described in this section. 

‘‘(h) MAINTENANCE OF EFFORT.—With respect to activities for 

which funds awarded under this section are to be expended, the 

entity shall agree to maintain expenditures of non-Federal amounts 

for such activities at a level that is not less than the level of 

such expenditures maintained by the entity for the fiscal year 

preceding the fiscal year for which the entity receives a grant 

under this section. 

‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated $4,000,000 for each of the fiscal years 2010 

through 2013.’’. 

(m)(1) Section 768 of the Public Health Service Act (42 U.S.C. 

295c) is amended to read as follows: 

‘‘SEC. 768. PREVENTIVE MEDICINE AND PUBLIC HEALTH TRAINING 

GRANT PROGRAM. 

‘‘(a) GRANTS.—The Secretary, acting through the Administrator 

of the Health Resources and Services Administration and in consultation with the Director of the Centers for Disease Control and 

Prevention, shall award grants to, or enter into contracts with, 

eligible entities to provide training to graduate medical residents 

in preventive medicine specialties. 
H. R. 3590—884 

‘‘(b) ELIGIBILITY.—To be eligible for a grant or contract under 

subsection (a), an entity shall be— 

‘‘(1) an accredited school of public health or school of medicine or osteopathic medicine; 

‘‘(2) an accredited public or private nonprofit hospital; 

‘‘(3) a State, local, or tribal health department; or 

‘‘(4) a consortium of 2 or more entities described in paragraphs (1) through (3). 

‘‘(c) USE OF FUNDS.—Amounts received under a grant or contract under this section shall be used to— 

‘‘(1) plan, develop (including the development of curricula), 

operate, or participate in an accredited residency or internship 

program in preventive medicine or public health; 

‘‘(2) defray the costs of practicum experiences, as required 

in such a program; and 

‘‘(3) establish, maintain, or improve— 

‘‘(A) academic administrative units (including departments, divisions, or other appropriate units) in preventive 

medicine and public health; or 

‘‘(B) programs that improve clinical teaching in preventive medicine and public health. 

‘‘(d) REPORT.—The Secretary shall submit to the Congress an 

annual report on the program carried out under this section.’’. 

(2) Section 770(a) of the Public Health Service Act (42 

U.S.C. 295e(a)) is amended to read as follows: 

‘‘(a) IN GENERAL.—For the purpose of carrying out this subpart, 

there is authorized to be appropriated $43,000,000 for fiscal year 

2011, and such sums as may be necessary for each of the fiscal 

years 2012 through 2015.’’. 

(n)(1) Subsection (i) of section 331 of the Public Health Service 

Act (42 U.S.C. 254d) of the Public Health Service Act is amended— 

(A) in paragraph (1), by striking ‘‘In carrying out subpart 

III’’ and all that follows through the period and inserting ‘‘In 

carrying out subpart III, the Secretary may, in accordance 

with this subsection, issue waivers to individuals who have 

entered into a contract for obligated service under the Scholarship Program or the Loan Repayment Program under which 

the individuals are authorized to satisfy the requirement of 

obligated service through providing clinical practice that is 

half time.’’; 

(B) in paragraph (2)— 

(i) in subparagraphs (A)(ii) and (B), by striking ‘‘less 

than full time’’ each place it appears and inserting ‘‘half 

time’’; 

(ii) in subparagraphs (C) and (F), by striking ‘‘less 

than full-time service’’ each place it appears and inserting 

‘‘half-time service’’; and 

(iii) by amending subparagraphs (D) and (E) to read 

as follows: 

‘‘(D) the entity and the Corps member agree in writing 

that the Corps member will perform half-time clinical practice; 

‘‘(E) the Corps member agrees in writing to fulfill all of 

the service obligations under section 338C through half-time 

clinical practice and either— 

‘‘(i) double the period of obligated service that would 

otherwise be required; or 
H. R. 3590—885 

‘‘(ii) in the case of contracts entered into under section 

338B, accept a minimum service obligation of 2 years with 

an award amount equal to 50 percent of the amount that 

would otherwise be payable for full-time service; and’’; and 

(C) in paragraph (3), by striking ‘‘In evaluating a demonstration project described in paragraph (1)’’ and inserting 

‘‘In evaluating waivers issued under paragraph (1)’’. 

(2) Subsection (j) of section 331 of the Public Health Service 

Act (42 U.S.C. 254d) is amended by adding at the end the following: 

‘‘(5) The terms ‘full time’ and ‘full-time’ mean a minimum 

of 40 hours per week in a clinical practice, for a minimum 

of 45 weeks per year. 

‘‘(6) The terms ‘half time’ and ‘half-time’ mean a minimum 

of 20 hours per week (not to exceed 39 hours per week) in 

a clinical practice, for a minimum of 45 weeks per year.’’. 

(3) Section 337(b)(1) of the Public Health Service Act (42 U.S.C. 

254j(b)(1)) is amended by striking ‘‘Members may not be reappointed 

to the Council.’’. 

(4) Section 338B(g)(2)(A) of the Public Health Service Act (42 

U.S.C. 254l–1(g)(2)(A)) is amended by striking ‘‘$35,000’’ and 

inserting ‘‘$50,000, plus, beginning with fiscal year 2012, an amount 

determined by the Secretary on an annual basis to reflect inflation,’’. 

(5) Subsection (a) of section 338C of the Public Health Service 

Act (42 U.S.C. 254m), as amended by section 5508, is amended— 

(A) by striking the second sentence and inserting the following: ‘‘The Secretary may treat teaching as clinical practice 

for up to 20 percent of such period of obligated service.’’; and 

(B) by adding at the end the following: ‘‘Notwithstanding 

the preceding sentence, with respect to a member of the Corps 

participating in the teaching health centers graduate medical 

education program under section 340H, for the purpose of calculating time spent in full-time clinical practice under this section, 

up to 50 percent of time spent teaching by such member may 

be counted toward his or her service obligation.’’. 

SEC. 10502. INFRASTRUCTURE TO EXPAND ACCESS TO CARE. 

(a) APPROPRIATION.—There are authorized to be appropriated, 

and there are appropriated to the Department of Health and Human 

Services, $100,000,000 for fiscal year 2010, to remain available 

for obligation until September 30, 2011, to be used for debt service 

on, or direct construction or renovation of, a health care facility 

that provides research, inpatient tertiary care, or outpatient clinical 

services. Such facility shall be affiliated with an academic health 

center at a public research university in the United States that 

contains a State’s sole public academic medical and dental school. 

(b) REQUIREMENT.—Amount appropriated under subsection (a) 

may only be made available by the Secretary of Health and Human 

Services upon the receipt of an application from the Governor 

of a State that certifies that— 

(1) the new health care facility is critical for the provision 

of greater access to health care within the State; 

(2) such facility is essential for the continued financial 

viability of the State’s sole public medical and dental school 

and its academic health center; 

(3) the request for Federal support represents not more 

than 40 percent of the total cost of the proposed new facility; 

and 
H. R. 3590—886 

(4) the State has established a dedicated funding mechanism to provide all remaining funds necessary to complete 

the construction or renovation of the proposed facility. 

SEC. 10503. COMMUNITY HEALTH CENTERS AND THE NATIONAL 

HEALTH SERVICE CORPS FUND. 

(a) PURPOSE.—It is the purpose of this section to establish 

a Community Health Center Fund (referred to in this section as 

the ‘‘CHC Fund’’), to be administered through the Office of the 

Secretary of the Department of Health and Human Services to 

provide for expanded and sustained national investment in community health centers under section 330 of the Public Health Service 

Act and the National Health Service Corps. 

(b) FUNDING.—There is authorized to be appropriated, and there 

is appropriated, out of any monies in the Treasury not otherwise 

appropriated, to the CHC Fund— 

(1) to be transferred to the Secretary of Health and Human 

Services to provide enhanced funding for the community health 

center program under section 330 of the Public Health Service 

Act— 

(A) $700,000,000 for fiscal year 2011; 

(B) $800,000,000 for fiscal year 2012; 

(C) $1,000,000,000 for fiscal year 2013; 

(D) $1,600,000,000 for fiscal year 2014; and 

(E) $2,900,000,000 for fiscal year 2015; and 

(2) to be transferred to the Secretary of Health and Human 

Services to provide enhanced funding for the National Health 

Service Corps— (A) $290,000,000 for fiscal year 2011; 

(B) $295,000,000 for fiscal year 2012; 

(C) $300,000,000 for fiscal year 2013; 

(D) $305,000,000 for fiscal year 2014; and 

(E) $310,000,000 for fiscal year 2015. 

(c) CONSTRUCTION.—There is authorized to be appropriated, 

and there is appropriated, out of any monies in the Treasury 

not otherwise appropriated, $1,500,000,000 to be available for fiscal 

years 2011 through 2015 to be used by the Secretary of Health 

and Human Services for the construction and renovation of community health centers. 

(d) USE OF FUND.—The Secretary of Health and Human Services shall transfer amounts in the CHC Fund to accounts within 

the Department of Health and Human Services to increase funding, 

over the fiscal year 2008 level, for community health centers and 

the National Health Service Corps. 

(e) AVAILABILITY.—Amounts appropriated under subsections (b) 

and (c) shall remain available until expended. 

SEC. 10504. DEMONSTRATION PROJECT TO PROVIDE ACCESS TO 

AFFORDABLE CARE. 

(a) IN GENERAL.—Not later than 6 months after the date of 

enactment of this Act, the Secretary of Health and Human Services 

(referred to in this section as the ‘‘Secretary’’), acting through the 

Health Resources and Services Administration, shall establish a 

3 year demonstration project in up to 10 States to provide access 

to comprehensive health care services to the uninsured at reduced 

fees. The Secretary shall evaluate the feasibility of expanding the 

project to additional States. 
H. R. 3590—887 

(b) ELIGIBILITY.—To be eligible to participate in the demonstration project, an entity shall be a State-based, nonprofit, publicprivate partnership that provides access to comprehensive health 

care services to the uninsured at reduced fees. Each State in which 

a participant selected by the Secretary is located shall receive 

not more than $2,000,000 to establish and carry out the project 

for the 3-year demonstration period. 

(c) AUTHORIZATION.—There is authorized to be appropriated 

such sums as may be necessary to carry out this section. 

Subtitle F—Provisions Relating to Title VI 

SEC. 10601. REVISIONS TO LIMITATION ON MEDICARE EXCEPTION TO 

THE PROHIBITION ON CERTAIN PHYSICIAN REFERRALS 

FOR HOSPITALS. 

(a) IN GENERAL.—Section 1877(i) of the Social Security Act, 

as added by section 6001(a), is amended— 

(1) in paragraph (1)(A)(i), by striking ‘‘February 1, 2010’’ 

and inserting ‘‘August 1, 2010’’; and 

(2) in paragraph (3)(A)— 

(A) in clause (iii), by striking ‘‘August 1, 2011’’ and 

inserting ‘‘February 1, 2012’’; and 

(B) in clause (iv), by striking ‘‘July 1, 2011’’ and 

inserting ‘‘January 1, 2012’’. 

(b) CONFORMING AMENDMENT.—Section 6001(b)(2) of this Act 

is amended by striking ‘‘November 1, 2011’’ and inserting ‘‘May 

1, 2012’’. 

SEC. 10602. CLARIFICATIONS TO PATIENT-CENTERED OUTCOMES 

RESEARCH. 

Section 1181 of the Social Security Act (as added by section 

6301) is amended— 

(1) in subsection (d)(2)(B)— 

(A) in clause (ii)(IV)— 

(i) by inserting ‘‘, as described in subparagraph 

(A)(ii),’’ after ‘‘original research’’; and 

(ii) by inserting ‘‘, as long as the researcher enters 

into a data use agreement with the Institute for use 

of the data from the original research, as appropriate’’ 

after ‘‘publication’’; and 

(B) by amending clause (iv) to read as follows: 

‘‘(iv) SUBSEQUENT USE OF THE DATA.—The Institute 

shall not allow the subsequent use of data from original 

research in work-for-hire contracts with individuals, 

entities, or instrumentalities that have a financial 

interest in the results, unless approved under a data 

use agreement with the Institute.’’; 

(2) in subsection (d)(8)(A)(iv), by striking ‘‘not be construed 

as mandates for’’ and inserting ‘‘do not include’’; and 

(3) in subsection (f)(1)(C), by amending clause (ii) to read 

as follows: 

‘‘(ii) 7 members representing physicians and providers, including 4 members representing physicians 

(at least 1 of whom is a surgeon), 1 nurse, 1 Statelicensed integrative health care practitioner, and 1 representative of a hospital.’’. 
H. R. 3590—888 

SEC. 10603. STRIKING PROVISIONS RELATING TO INDIVIDUAL PROVIDER APPLICATION FEES. 

(a) IN GENERAL.—Section 1866(j)(2)(C) of the Social Security 

Act, as added by section 6401(a), is amended— 

(1) by striking clause (i); 

(2) by redesignating clauses (ii) through (iv), respectively, 

as clauses (i) through (iii); and 

(3) in clause (i), as redesignated by paragraph (2), by 

striking ‘‘clause (iii)’’ and inserting ‘‘clause (ii)’’. 

(b) TECHNICAL CORRECTION.—Section 6401(a)(2) of this Act is 

amended to read as follows: 

‘‘(2) by redesignating paragraph (2) as paragraph (8); and’’. 

SEC. 10604. TECHNICAL CORRECTION TO SECTION 6405. 

Paragraphs (1) and (2) of section 6405(b) are amended to read 

as follows: 

‘‘(1) PART A.—Section 1814(a)(2) of the Social Security Act 

(42 U.S.C. 1395(a)(2)) is amended in the matter preceding 

subparagraph (A) by inserting ‘, or, in the case of services 

described in subparagraph (C), a physician enrolled under section 1866(j),’ after ‘in collaboration with a physician,’. 

‘‘(2) PART B.—Section 1835(a)(2) of the Social Security Act 

(42 U.S.C. 1395n(a)(2)) is amended in the matter preceding 

subparagraph (A) by inserting ‘, or, in the case of services 

described in subparagraph (A), a physician enrolled under section 1866(j),’ after ‘a physician’.’’. 

SEC. 10605. CERTAIN OTHER PROVIDERS PERMITTED TO CONDUCT 

FACE TO FACE ENCOUNTER FOR HOME HEALTH SERVICES. 

(a) PART A.—Section 1814(a)(2)(C) of the Social Security Act 

(42 U.S.C. 1395f(a)(2)(C)), as amended by section 6407(a)(1), is 

amended by inserting ‘‘, or a nurse practitioner or clinical nurse 

specialist (as those terms are defined in section 1861(aa)(5)) who 

is working in collaboration with the physician in accordance with 

State law, or a certified nurse-midwife (as defined in section 

1861(gg)) as authorized by State law, or a physician assistant 

(as defined in section 1861(aa)(5)) under the supervision of the 

physician,’’ after ‘‘himself or herself’’. 

(b) PART B.—Section 1835(a)(2)(A)(iv) of the Social Security 

Act, as added by section 6407(a)(2), is amended by inserting ‘‘, 

or a nurse practitioner or clinical nurse specialist (as those terms 

are defined in section 1861(aa)(5)) who is working in collaboration 

with the physician in accordance with State law, or a certified 

nurse-midwife (as defined in section 1861(gg)) as authorized by 

State law, or a physician assistant (as defined in section 1861(aa)(5)) 

under the supervision of the physician,’’ after ‘‘must document that 

the physician’’. 

SEC. 10606. HEALTH CARE FRAUD ENFORCEMENT. 

(a) FRAUD SENTENCING GUIDELINES.— 

(1) DEFINITION.—In this subsection, the term ‘‘Federal 

health care offense’’ has the meaning given that term in section 

24 of title 18, United States Code, as amended by this Act. 

(2) REVIEW AND AMENDMENTS.—Pursuant to the authority 

under section 994 of title 28, United States Code, and in accordance with this subsection, the United States Sentencing 

Commission shall— 
H. R. 3590—889 

(A) review the Federal Sentencing Guidelines and 

policy statements applicable to persons convicted of Federal 

health care offenses; 

(B) amend the Federal Sentencing Guidelines and 

policy statements applicable to persons convicted of Federal 

health care offenses involving Government health care programs to provide that the aggregate dollar amount of 

fraudulent bills submitted to the Government health care 

program shall constitute prima facie evidence of the amount 

of the intended loss by the defendant; and 

(C) amend the Federal Sentencing Guidelines to provide— 

(i) a 2-level increase in the offense level for any 

defendant convicted of a Federal health care offense 

relating to a Government health care program which 

involves a loss of not less than $1,000,000 and less 

than $7,000,000; 

(ii) a 3-level increase in the offense level for any 

defendant convicted of a Federal health care offense 

relating to a Government health care program which 

involves a loss of not less than $7,000,000 and less 

than $20,000,000; 

(iii) a 4-level increase in the offense level for any 

defendant convicted of a Federal health care offense 

relating to a Government health care program which 

involves a loss of not less than $20,000,000; and 

(iv) if appropriate, otherwise amend the Federal 

Sentencing Guidelines and policy statements applicable 

to persons convicted of Federal health care offenses 

involving Government health care programs. 

(3) REQUIREMENTS.—In carrying this subsection, the United 

States Sentencing Commission shall— 

(A) ensure that the Federal Sentencing Guidelines and 

policy statements— 

(i) reflect the serious harms associated with health 

care fraud and the need for aggressive and appropriate 

law enforcement action to prevent such fraud; and 

(ii) provide increased penalties for persons convicted of health care fraud offenses in appropriate circumstances; 

(B) consult with individuals or groups representing 

health care fraud victims, law enforcement officials, the 

health care industry, and the Federal judiciary as part 

of the review described in paragraph (2); 

(C) ensure reasonable consistency with other relevant 

directives and with other guidelines under the Federal 

Sentencing Guidelines; 

(D) account for any aggravating or mitigating circumstances that might justify exceptions, including circumstances for which the Federal Sentencing Guidelines, 

as in effect on the date of enactment of this Act, provide 

sentencing enhancements; 

(E) make any necessary conforming changes to the 

Federal Sentencing Guidelines; and 

(F) ensure that the Federal Sentencing Guidelines adequately meet the purposes of sentencing. 
H. R. 3590—890 

(b) INTENT REQUIREMENT FOR HEALTH CARE FRAUD.—Section 

1347 of title 18, United States Code, is amended— 

(1) by inserting ‘‘(a)’’ before ‘‘Whoever knowingly’’; and 

(2) by adding at the end the following: 

‘‘(b) With respect to violations of this section, a person need 

not have actual knowledge of this section or specific intent to 

commit a violation of this section.’’. 

(c) HEALTH CARE FRAUD OFFENSE.—Section 24(a) of title 18, 

United States Code, is amended— 

(1) in paragraph (1), by striking the semicolon and inserting 

‘‘or section 1128B of the Social Security Act (42 U.S.C. 1320a– 

7b); or’’; and 

(2) in paragraph (2)— 

(A) by inserting ‘‘1349,’’ after ‘‘1343,’’; and 

(B) by inserting ‘‘section 301 of the Federal Food, Drug, 

and Cosmetic Act (21 U.S.C. 331), or section 501 of the 

Employee Retirement Income Security Act of 1974 (29 

U.S.C. 1131),’’ after ‘‘title,’’. 

(d) SUBPOENA AUTHORITY RELATING TO HEALTH CARE.— 

(1) SUBPOENAS UNDER THE HEALTH INSURANCE PORTABILITY

AND ACCOUNTABILITY ACT OF 1996.—Section 1510(b) of title 18, 

United States Code, is amended— 

(A) in paragraph (1), by striking ‘‘to the grand jury’’; 

and 

(B) in paragraph (2)— 

(i) in subparagraph (A), by striking ‘‘grand jury 

subpoena’’ and inserting ‘‘subpoena for records’’; and 

(ii) in the matter following subparagraph (B), by 

striking ‘‘to the grand jury’’. 

(2) SUBPOENAS UNDER THE CIVIL RIGHTS OF INSTITUTIONAL- IZED PERSONS ACT.—The Civil Rights of Institutionalized Persons Act (42 U.S.C. 1997 et seq.) is amended by inserting 

after section 3 the following: 

‘‘SEC. 3A. SUBPOENA AUTHORITY. 

‘‘(a) AUTHORITY.—The Attorney General, or at the direction 

of the Attorney General, any officer or employee of the Department 

of Justice may require by subpoena access to any institution that 

is the subject of an investigation under this Act and to any document, record, material, file, report, memorandum, policy, procedure, 

investigation, video or audio recording, or quality assurance report 

relating to any institution that is the subject of an investigation 

under this Act to determine whether there are conditions which 

deprive persons residing in or confined to the institution of any 

rights, privileges, or immunities secured or protected by the Constitution or laws of the United States. 

‘‘(b) ISSUANCE AND ENFORCEMENT OF SUBPOENAS.— 

‘‘(1) ISSUANCE.—Subpoenas issued under this section— 

‘‘(A) shall bear the signature of the Attorney General 

or any officer or employee of the Department of Justice 

as designated by the Attorney General; and 

‘‘(B) shall be served by any person or class of persons 

designated by the Attorney General or a designated officer 

or employee for that purpose. 

‘‘(2) ENFORCEMENT.—In the case of contumacy or failure 

to obey a subpoena issued under this section, the United States 

district court for the judicial district in which the institution 
H. R. 3590—891 

is located may issue an order requiring compliance. Any failure 

to obey the order of the court may be punished by the court 

as a contempt that court. 

‘‘(c) PROTECTION OF SUBPOENAED RECORDS AND INFORMATION.— Any document, record, material, file, report, memorandum, policy, 

procedure, investigation, video or audio recording, or quality assurance report or other information obtained under a subpoena issued 

under this section— 

‘‘(1) may not be used for any purpose other than to protect 

the rights, privileges, or immunities secured or protected by 

the Constitution or laws of the United States of persons who 

reside, have resided, or will reside in an institution; 

‘‘(2) may not be transmitted by or within the Department 

of Justice for any purpose other than to protect the rights, 

privileges, or immunities secured or protected by the Constitution or laws of the United States of persons who reside, have 

resided, or will reside in an institution; and 

‘‘(3) shall be redacted, obscured, or otherwise altered if 

used in any publicly available manner so as to prevent the 

disclosure of any personally identifiable information.’’. 

SEC. 10607. STATE DEMONSTRATION PROGRAMS TO EVALUATE ALTERNATIVES TO CURRENT MEDICAL TORT LITIGATION. 

Part P of title III of the Public Health Service Act (42 U.S.C. 

280g et seq.), as amended by this Act, is further amended by 

adding at the end the following: 

‘‘SEC. 399V–4. STATE DEMONSTRATION PROGRAMS TO EVALUATE 

ALTERNATIVES TO CURRENT MEDICAL TORT LITIGATION. 

‘‘(a) IN GENERAL.—The Secretary is authorized to award demonstration grants to States for the development, implementation, 

and evaluation of alternatives to current tort litigation for resolving 

disputes over injuries allegedly caused by health care providers 

or health care organizations. In awarding such grants, the Secretary 

shall ensure the diversity of the alternatives so funded. 

‘‘(b) DURATION.—The Secretary may award grants under subsection (a) for a period not to exceed 5 years. 

‘‘(c) CONDITIONS FOR DEMONSTRATION GRANTS.— ‘‘(1) REQUIREMENTS.—Each State desiring a grant under 

subsection (a) shall develop an alternative to current tort litigation that— 

‘‘(A) allows for the resolution of disputes over injuries 

allegedly caused by health care providers or health care 

organizations; and 

‘‘(B) promotes a reduction of health care errors by 

encouraging the collection and analysis of patient safety 

data related to disputes resolved under subparagraph (A) 

by organizations that engage in efforts to improve patient 

safety and the quality of health care. 

‘‘(2) ALTERNATIVE TO CURRENT TORT LITIGATION.—Each 

State desiring a grant under subsection (a) shall demonstrate 

how the proposed alternative described in paragraph (1)(A)— 

‘‘(A) makes the medical liability system more reliable 

by increasing the availability of prompt and fair resolution 

of disputes; 

‘‘(B) encourages the efficient resolution of disputes; 

‘‘(C) encourages the disclosure of health care errors; 
H. R. 3590—892 

‘‘(D) enhances patient safety by detecting, analyzing, 

and helping to reduce medical errors and adverse events; 

‘‘(E) improves access to liability insurance; 

‘‘(F) fully informs patients about the differences in 

the alternative and current tort litigation; 

‘‘(G) provides patients the ability to opt out of or voluntarily withdraw from participating in the alternative at 

any time and to pursue other options, including litigation, 

outside the alternative; 

‘‘(H) would not conflict with State law at the time 

of the application in a way that would prohibit the adoption 

of an alternative to current tort litigation; and 

‘‘(I) would not limit or curtail a patient’s existing legal 

rights, ability to file a claim in or access a State’s legal 

system, or otherwise abrogate a patient’s ability to file 

a medical malpractice claim. 

‘‘(3) SOURCES OF COMPENSATION.—Each State desiring a 

grant under subsection (a) shall identify the sources from and 

methods by which compensation would be paid for claims 

resolved under the proposed alternative to current tort litigation, which may include public or private funding sources, 

or a combination of such sources. Funding methods shall to 

the extent practicable provide financial incentives for activities 

that improve patient safety. 

‘‘(4) SCOPE.— ‘‘(A) IN GENERAL.—Each State desiring a grant under 

subsection (a) shall establish a scope of jurisdiction (such 

as Statewide, designated geographic region, a designated 

area of health care practice, or a designated group of health 

care providers or health care organizations) for the proposed alternative to current tort litigation that is sufficient 

to evaluate the effects of the alternative. No scope of jurisdiction shall be established under this paragraph that is 

based on a health care payer or patient population. 

‘‘(B) NOTIFICATION OF PATIENTS.—A State shall demonstrate how patients would be notified that they are 

receiving health care services that fall within such scope, 

and the process by which they may opt out of or voluntarily 

withdraw from participating in the alternative. The decision of the patient whether to participate or continue 

participating in the alternative process shall be made at 

any time and shall not be limited in any way. 

‘‘(5) PREFERENCE IN AWARDING DEMONSTRATION GRANTS.— 

In awarding grants under subsection (a), the Secretary shall 

give preference to States— 

‘‘(A) that have developed the proposed alternative 

through substantive consultation with relevant stakeholders, including patient advocates, health care providers 

and health care organizations, attorneys with expertise 

in representing patients and health care providers, medical 

malpractice insurers, and patient safety experts; 

‘‘(B) that make proposals that are likely to enhance 

patient safety by detecting, analyzing, and helping to 

reduce medical errors and adverse events; and 

‘‘(C) that make proposals that are likely to improve 

access to liability insurance. 

‘‘(d) APPLICATION.— 
H. R. 3590—893 

‘‘(1) IN GENERAL.—Each State desiring a grant under subsection (a) shall submit to the Secretary an application, at 

such time, in such manner, and containing such information 

as the Secretary may require. 

‘‘(2) REVIEW PANEL.— 

‘‘(A) IN GENERAL.—In reviewing applications under 

paragraph (1), the Secretary shall consult with a review 

panel composed of relevant experts appointed by the Comptroller General. 

‘‘(B) COMPOSITION.— 

‘‘(i) NOMINATIONS.—The Comptroller General shall 

solicit nominations from the public for individuals to 

serve on the review panel. 

‘‘(ii) APPOINTMENT.—The Comptroller General 

shall appoint, at least 9 but not more than 13, highly 

qualified and knowledgeable individuals to serve on 

the review panel and shall ensure that the following 

entities receive fair representation on such panel: 

‘‘(I) Patient advocates. 

‘‘(II) Health care providers and health care 

organizations. 

‘‘(III) Attorneys with expertise in representing 

patients and health care providers. 

‘‘(IV) Medical malpractice insurers. 

‘‘(V) State officials. 

‘‘(VI) Patient safety experts. 

‘‘(C) CHAIRPERSON.—The Comptroller General, or an 

individual within the Government Accountability Office 

designated by the Comptroller General, shall be the chairperson of the review panel. 

‘‘(D) AVAILABILITY OF INFORMATION.—The Comptroller 

General shall make available to the review panel such 

information, personnel, and administrative services and 

assistance as the review panel may reasonably require 

to carry out its duties. 

‘‘(E) INFORMATION FROM AGENCIES.—The review panel 

may request directly from any department or agency of 

the United States any information that such panel considers necessary to carry out its duties. To the extent 

consistent with applicable laws and regulations, the head 

of such department or agency shall furnish the requested 

information to the review panel. 

‘‘(e) REPORTS.— 

‘‘(1) BY STATE.—Each State receiving a grant under subsection (a) shall submit to the Secretary an annual report 

evaluating the effectiveness of activities funded with grants 

awarded under such subsection. Such report shall, at a minimum, include the impact of the activities funded on patient 

safety and on the availability and price of medical liability 

insurance. 

‘‘(2) BY SECRETARY.—The Secretary shall submit to Congress an annual compendium of the reports submitted under 

paragraph (1) and an analysis of the activities funded under 

subsection (a) that examines any differences that result from 

such activities in terms of the quality of care, number and 

nature of medical errors, medical resources used, length of 
H. R. 3590—894 

time for dispute resolution, and the availability and price of 

liability insurance. 

‘‘(f) TECHNICAL ASSISTANCE.— 

‘‘(1) IN GENERAL.—The Secretary shall provide technical 

assistance to the States applying for or awarded grants under 

subsection (a). 

‘‘(2) REQUIREMENTS.—Technical assistance under paragraph (1) shall include— 

‘‘(A) guidance on non-economic damages, including the 

consideration of individual facts and circumstances in 

determining appropriate payment, guidance on identifying 

avoidable injuries, and guidance on disclosure to patients 

of health care errors and adverse events; and 

‘‘(B) the development, in consultation with States, of 

common definitions, formats, and data collection infrastructure for States receiving grants under this section to use 

in reporting to facilitate aggregation and analysis of data 

both within and between States. 

‘‘(3) USE OF COMMON DEFINITIONS, FORMATS, AND DATA

COLLECTION INFRASTRUCTURE.—States not receiving grants 

under this section may also use the common definitions, formats, and data collection infrastructure developed under paragraph (2)(B). 

‘‘(g) EVALUATION.— 

‘‘(1) IN GENERAL.—The Secretary, in consultation with the 

review panel established under subsection (d)(2), shall enter 

into a contract with an appropriate research organization to 

conduct an overall evaluation of the effectiveness of grants 

awarded under subsection (a) and to annually prepare and 

submit a report to Congress. Such an evaluation shall begin 

not later than 18 months following the date of implementation 

of the first program funded by a grant under subsection (a). 

‘‘(2) CONTENTS.—The evaluation under paragraph (1) shall 

include— 

‘‘(A) an analysis of the effects of the grants awarded 

under subsection (a) with regard to the measures described 

in paragraph (3); 

‘‘(B) for each State, an analysis of the extent to which 

the alternative developed under subsection (c)(1) is effective 

in meeting the elements described in subsection (c)(2); 

‘‘(C) a comparison among the States receiving grants 

under subsection (a) of the effectiveness of the various 

alternatives developed by such States under subsection 

(c)(1); 

‘‘(D) a comparison, considering the measures described 

in paragraph (3), of States receiving grants approved under 

subsection (a) and similar States not receiving such grants; 

and 

‘‘(E) a comparison, with regard to the measures 

described in paragraph (3), of— 

‘‘(i) States receiving grants under subsection (a); 

‘‘(ii) States that enacted, prior to the date of enactment of the Patient Protection and Affordable Care 

Act, any cap on non-economic damages; and 

‘‘(iii) States that have enacted, prior to the date 

of enactment of the Patient Protection and Affordable 

Care Act, a requirement that the complainant obtain 
H. R. 3590—895 

an opinion regarding the merit of the claim, although 

the substance of such opinion may have no bearing 

on whether the complainant may proceed with a case. 

‘‘(3) MEASURES.—The evaluations under paragraph (2) shall 

analyze and make comparisons on the basis of— 

‘‘(A) the nature and number of disputes over injuries 

allegedly caused by health care providers or health care 

organizations; 

‘‘(B) the nature and number of claims in which tort 

litigation was pursued despite the existence of an alternative under subsection (a); 

‘‘(C) the disposition of disputes and claims, including 

the length of time and estimated costs to all parties; 

‘‘(D) the medical liability environment; 

‘‘(E) health care quality; 

‘‘(F) patient safety in terms of detecting, analyzing, 

and helping to reduce medical errors and adverse events; 

‘‘(G) patient and health care provider and organization 

satisfaction with the alternative under subsection (a) and 

with the medical liability environment; and 

‘‘(H) impact on utilization of medical services, appropriately adjusted for risk. 

‘‘(4) FUNDING.—The Secretary shall reserve 5 percent of 

the amount appropriated in each fiscal year under subsection 

(k) to carry out this subsection. 

‘‘(h) MEDPAC AND MACPAC REPORTS.— 

‘‘(1) MEDPAC.—The Medicare Payment Advisory Commission shall conduct an independent review of the alternatives 

to current tort litigation that are implemented under grants 

under subsection (a) to determine the impact of such alternatives on the Medicare program under title XVIII of the Social 

Security Act, and its beneficiaries. 

‘‘(2) MACPAC.—The Medicaid and CHIP Payment and 

Access Commission shall conduct an independent review of 

the alternatives to current tort litigation that are implemented 

under grants under subsection (a) to determine the impact 

of such alternatives on the Medicaid or CHIP programs under 

titles XIX and XXI of the Social Security Act, and their beneficiaries. 

‘‘(3) REPORTS.—Not later than December 31, 2016, the 

Medicare Payment Advisory Commission and the Medicaid and 

CHIP Payment and Access Commission shall each submit to 

Congress a report that includes the findings and recommendations of each respective Commission based on independent 

reviews conducted under paragraphs (1) and (2), including an 

analysis of the impact of the alternatives reviewed on the 

efficiency and effectiveness of the respective programs. 

‘‘(i) OPTION TO PROVIDE FOR INITIAL PLANNING GRANTS.—Of 

the funds appropriated pursuant to subsection (k), the Secretary 

may use a portion not to exceed $500,000 per State to provide 

planning grants to such States for the development of demonstration 

project applications meeting the criteria described in subsection 

(c). In selecting States to receive such planning grants, the Secretary 

shall give preference to those States in which State law at the 

time of the application would not prohibit the adoption of an alternative to current tort litigation. 

‘‘(j) DEFINITIONS.—In this section: 
H. R. 3590—896 

‘‘(1) HEALTH CARE SERVICES.—The term ‘health care services’ means any services provided by a health care provider, 

or by any individual working under the supervision of a health 

care provider, that relate to— 

‘‘(A) the diagnosis, prevention, or treatment of any 

human disease or impairment; or 

‘‘(B) the assessment of the health of human beings. 

‘‘(2) HEALTH CARE ORGANIZATION.—The term ‘health care 

organization’ means any individual or entity which is obligated 

to provide, pay for, or administer health benefits under any 

health plan. 

‘‘(3) HEALTH CARE PROVIDER.—The term ‘health care provider’ means any individual or entity— 

‘‘(A) licensed, registered, or certified under Federal or 

State laws or regulations to provide health care services; 

or 

‘‘(B) required to be so licensed, registered, or certified 

but that is exempted by other statute or regulation. 

‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 

to be appropriated to carry out this section, $50,000,000 for the 

5-fiscal year period beginning with fiscal year 2011. 

‘‘(l) CURRENT STATE EFFORTS TO ESTABLISH ALTERNATIVE TO

TORT LITIGATION.—Nothing in this section shall be construed to 

limit any prior, current, or future efforts of any State to establish 

any alternative to tort litigation. 

‘‘(m) RULE OF CONSTRUCTION.—Nothing in this section shall 

be construed as limiting states’ authority over or responsibility 

for their state justice systems.’’. 

SEC. 10608. EXTENSION OF MEDICAL MALPRACTICE COVERAGE TO 

FREE CLINICS. 

(a) IN GENERAL.—Section 224(o)(1) of the Public Health Service 

Act (42 U.S.C. 233(o)(1)) is amended by inserting after ‘‘to an 

individual’’ the following: ‘‘, or an officer, governing board member, 

employee, or contractor of a free clinic shall in providing services 

for the free clinic,’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall take effect on the date of enactment of this Act and apply 

to any act or omission which occurs on or after that date. 

SEC. 10609. LABELING CHANGES. 

Section 505(j) of the Federal Food, Drug, and Cosmetic Act 

(21 U.S.C. 355(j)) is amended by adding at the end the following: 

‘‘(10)(A) If the proposed labeling of a drug that is the subject 

of an application under this subsection differs from the listed drug 

due to a labeling revision described under clause (i), the drug 

that is the subject of such application shall, notwithstanding any 

other provision of this Act, be eligible for approval and shall not 

be considered misbranded under section 502 if— 

‘‘(i) the application is otherwise eligible for approval under 

this subsection but for expiration of patent, an exclusivity 

period, or of a delay in approval described in paragraph 

(5)(B)(iii), and a revision to the labeling of the listed drug 

has been approved by the Secretary within 60 days of such 

expiration; 

‘‘(ii) the labeling revision described under clause (i) does 

not include a change to the ‘Warnings’ section of the labeling; 
H. R. 3590—897 

‘‘(iii) the sponsor of the application under this subsection 

agrees to submit revised labeling of the drug that is the subject 

of such application not later than 60 days after the notification 

of any changes to such labeling required by the Secretary; 

and 

‘‘(iv) such application otherwise meets the applicable 

requirements for approval under this subsection. 

‘‘(B) If, after a labeling revision described in subparagraph 

(A)(i), the Secretary determines that the continued presence in 

interstate commerce of the labeling of the listed drug (as in effect 

before the revision described in subparagraph (A)(i)) adversely 

impacts the safe use of the drug, no application under this subsection shall be eligible for approval with such labeling.’’. 

Subtitle G—Provisions Relating to Title 

VIII 

SEC. 10801. PROVISIONS RELATING TO TITLE VIII. 

(a) Title XXXII of the Public Health Service Act, as added 

by section 8002(a)(1), is amended— 

(1) in section 3203— 

(A) in subsection (a)(1), by striking subparagraph (E); 

(B) in subsection (b)(1)(C)(i), by striking ‘‘for enrollment’’ and inserting ‘‘for reenrollment’’; and 

(C) in subsection (c)(1), by striking ‘‘, as part of their 

automatic enrollment in the CLASS program,’’; and 

(2) in section 3204— 

(A) in subsection (c)(2), by striking subparagraph (A) 

and inserting the following: 

‘‘(A) receives wages or income on which there is 

imposed a tax under section 3101(a) or 3201(a) of the 

Internal Revenue Code of 1986; or’’; 

(B) in subsection (d), by striking ‘‘subparagraph (B) 

or (C) of subsection (c)(1)’’ and inserting ‘‘subparagraph 

(A) or (B) of subsection (c)(2)’’; 

(C) in subsection (e)(2)(A), by striking ‘‘subparagraph 

(A)’’ and inserting ‘‘paragraph (1)’’; and 

(D) in subsection (g)(1), by striking ‘‘has elected to 

waive enrollment’’ and inserting ‘‘has not enrolled’’. 

(b) Section 8002 of this Act is amended in the heading for 

subsection (d), by striking ‘‘INFORMATION ON SUPPLEMENTAL COVERAGE’’ and inserting ‘‘CLASS PROGRAM INFORMATION’’. 

(c) Section 6021(d)(2)(A)(iv) of the Deficit Reduction Act of 

2005, as added by section 8002(d) of this Act, is amended by 

striking ‘‘and coverage available’’ and all that follows through ‘‘that 

program,’’. 

Subtitle H—Provisions Relating to Title IX 

SEC. 10901. MODIFICATIONS TO EXCISE TAX ON HIGH COST EMPLOYERSPONSORED HEALTH COVERAGE. 

(a) LONGSHORE WORKERS TREATED AS EMPLOYEES ENGAGED

IN HIGH-RISK PROFESSIONS.—Paragraph (3) of section 4980I(f) of 

the Internal Revenue Code of 1986, as added by section 9001 

of this Act, is amended by inserting ‘‘individuals whose primary 
H. R. 3590—898 

work is longshore work (as defined in section 258(b) of the Immigration and Nationality Act (8 U.S.C. 1288(b)), determined without 

regard to paragraph (2) thereof),’’ before ‘‘and individuals engaged 

in the construction, mining’’. 

(b) EXEMPTION FROM HIGH-COST INSURANCE TAX INCLUDES CERTAIN ADDITIONAL EXCEPTED BENEFITS.—Clause (i) of section 

4980I(d)(1)(B) of the Internal Revenue Code of 1986, as added 

by section 9001 of this Act, is amended by striking ‘‘section 

9832(c)(1)(A)’’ and inserting ‘‘section 9832(c)(1) (other than subparagraph (G) thereof)’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2012. 

SEC. 10902. INFLATION ADJUSTMENT OF LIMITATION ON HEALTH 

FLEXIBLE SPENDING ARRANGEMENTS UNDER CAFETERIA PLANS. 

(a) IN GENERAL.—Subsection (i) of section 125 of the Internal 

Revenue Code of 1986, as added by section 9005 of this Act, is 

amended to read as follows: 

‘‘(i) LIMITATION ON HEALTH FLEXIBLE SPENDING ARRANGEMENTS.— 

‘‘(1) IN GENERAL.—For purposes of this section, if a benefit 

is provided under a cafeteria plan through employer contributions to a health flexible spending arrangement, such benefit 

shall not be treated as a qualified benefit unless the cafeteria 

plan provides that an employee may not elect for any taxable 

year to have salary reduction contributions in excess of $2,500 

made to such arrangement. 

‘‘(2) ADJUSTMENT FOR INFLATION.—In the case of any taxable year beginning after December 31, 2011, the dollar amount 

in paragraph (1) shall be increased by an amount equal to— 

‘‘(A) such amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which such taxable 

year begins by substituting ‘calendar year 2010’ for ‘calendar year 1992’ in subparagraph (B) thereof. 

If any increase determined under this paragraph is not a multiple of $50, such increase shall be rounded to the next lowest 

multiple of $50.’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after December 31, 2010. 

SEC. 10903. MODIFICATION OF LIMITATION ON CHARGES BY CHARITABLE HOSPITALS. 

(a) IN GENERAL.—Subparagraph (A) of section 501(r)(5) of the 

Internal Revenue Code of 1986, as added by section 9007 of this 

Act, is amended by striking ‘‘the lowest amounts charged’’ and 

inserting ‘‘the amounts generally billed’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to taxable years beginning after the date of the enactment of this Act. 

SEC. 10904. MODIFICATION OF ANNUAL FEE ON MEDICAL DEVICE 

MANUFACTURERS AND IMPORTERS. 

(a) IN GENERAL.—Section 9009 of this Act is amended— 

(1) by striking ‘‘2009’’ in subsection (a)(1) and inserting 

‘‘2010’’, 
H. R. 3590—899 

(2) by inserting ‘‘($3,000,000,000 after 2017)’’ after ‘‘$2,000,000,000’’, and 

(3) by striking ‘‘2008’’ in subsection (i) and inserting ‘‘2009’’. 

(b) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of section 9009. 

SEC. 10905. MODIFICATION OF ANNUAL FEE ON HEALTH INSURANCE 

PROVIDERS. 

(a) DETERMINATION OF FEE AMOUNT.—Subsection (b) of section 

9010 of this Act is amended to read as follows: 

‘‘(b) DETERMINATION OF FEE AMOUNT.— ‘‘(1) IN GENERAL.—With respect to each covered entity, 

the fee under this section for any calendar year shall be equal 

to an amount that bears the same ratio to the applicable 

amount as— 

‘‘(A) the covered entity’s net premiums written with 

respect to health insurance for any United States health 

risk that are taken into account during the preceding calendar year, bears to 

‘‘(B) the aggregate net premiums written with respect 

to such health insurance of all covered entities that are 

taken into account during such preceding calendar year. 

‘‘(2) AMOUNTS TAKEN INTO ACCOUNT.—For purposes of paragraph (1), the net premiums written with respect to health 

insurance for any United States health risk that are taken 

into account during any calendar year with respect to any 

covered entity shall be determined in accordance with the following table: 

‘‘With respect to a covered entity’s net premiums written during the calendar year that 

are: 

The percentage of 

net premiums written that are taken 

into account is: 

Not more than $25,000,000 ..................... 0 percent 

More than $25,000,000 but not more 

than $50,000,000.

50 percent 

More than $50,000,000 ............................. 100 percent. 

‘‘(3) SECRETARIAL DETERMINATION.—The Secretary shall 

calculate the amount of each covered entity’s fee for any calendar year under paragraph (1). In calculating such amount, 

the Secretary shall determine such covered entity’s net premiums written with respect to any United States health risk 

on the basis of reports submitted by the covered entity under 

subsection (g) and through the use of any other source of 

information available to the Secretary.’’. 

(b) APPLICABLE AMOUNT.—Subsection (e) of section 9010 of 

this Act is amended to read as follows: 

‘‘(e) APPLICABLE AMOUNT.—For purposes of subsection (b)(1), 

the applicable amount shall be determined in accordance with the 

following table: 

‘‘Calendar year Applicable 

amount 

2011 ........................................................... $2,000,000,000 

2012 ........................................................... $4,000,000,000 
H. R. 3590—900 

2013 ........................................................... $7,000,000,000 

2014, 2015 and 2016 ................................. $9,000,000,000 

2017 and thereafter .................................. $10,000,000,000.’’. 

(c) EXEMPTION FROM ANNUAL FEE ON HEALTH INSURANCE FOR

CERTAIN NONPROFIT ENTITIES.—Section 9010(c)(2) of this Act is 

amended by striking ‘‘or’’ at the end of subparagraph (A), by striking 

the period at the end of subparagraph (B) and inserting a comma, 

and by adding at the end the following new subparagraphs: 

‘‘(C) any entity— 

‘‘(i)(I) which is incorporated as, is a wholly owned 

subsidiary of, or is a wholly owned affiliate of, a nonprofit corporation under a State law, or 

‘‘(II) which is described in section 501(c)(4) of the 

Internal Revenue Code of 1986 and the activities of 

which consist of providing commercial-type insurance 

(within the meaning of section 501(m) of such Code), 

‘‘(ii) the premium rate increases of which are regulated by a State authority, 

‘‘(iii) which, as of the date of the enactment of 

this section, acts as the insurer of last resort in the 

State and is subject to State guarantee issue requirements, and 

‘‘(iv) for which the medical loss ratio (determined 

in a manner consistent with the determination of such 

ratio under section 2718(b)(1)(A) of the Public Health 

Service Act) with respect to the individual insurance 

market for such entity for the calendar year is not 

less than 100 percent, 

‘‘(D) any entity— 

‘‘(i)(I) which is incorporated as a nonprofit corporation under a State law, or 

‘‘(II) which is described in section 501(c)(4) of the 

Internal Revenue Code of 1986 and the activities of 

which consist of providing commercial-type insurance 

(within the meaning of section 501(m) of such Code), 

and 

‘‘(ii) for which the medical loss ratio (as so determined)— 

‘‘(I) with respect to each of the individual, 

small group, and large group insurance markets 

for such entity for the calendar year is not less 

than 90 percent, and 

‘‘(II) with respect to all such markets for such 

entity for the calendar year is not less than 92 

percent, or 

‘‘(E) any entity— 

‘‘(i) which is a mutual insurance company, 

‘‘(ii) which for the period reported on the 2008 

Accident and Health Policy Experience Exhibit of the 

National Association of Insurance Commissioners 

had— 

‘‘(I) a market share of the insured population 

of a State of at least 40 but not more than 60 

percent, and 
H. R. 3590—901 

‘‘(II) with respect to all markets described in 

subparagraph (D)(ii)(I), a medical loss ratio of not 

less than 90 percent, and 

‘‘(iii) with respect to annual payment dates in calendar years after 2011, for which the medical loss 

ratio (determined in a manner consistent with the 

determination of such ratio under section 2718(b)(1)(A) 

of the Public Health Service Act) with respect to all 

such markets for such entity for the preceding calendar 

year is not less than 89 percent (except that with 

respect to such annual payment date for 2012, the 

calculation under 2718(b)(1)(B)(ii) of such Act is determined by reference to the previous year, and with 

respect to such annual payment date for 2013, such 

calculation is determined by reference to the average 

for the previous 2 years).’’. 

(d) CERTAIN INSURANCE EXEMPTED FROM FEE.—Paragraph (3) 

of section 9010(h) of this Act is amended to read as follows: 

‘‘(3) HEALTH INSURANCE.—The term ‘health insurance’ shall 

not include— 

‘‘(A) any insurance coverage described in paragraph 

(1)(A) or (3) of section 9832(c) of the Internal Revenue 

Code of 1986, 

‘‘(B) any insurance for long-term care, or 

‘‘(C) any medicare supplemental health insurance (as 

defined in section 1882(g)(1) of the Social Security Act).’’. 

(e) ANTI-AVOIDANCE GUIDANCE.—Subsection (i) of section 9010 

of this Act is amended by inserting ‘‘and shall prescribe such regulations as are necessary or appropriate to prevent avoidance of the 

purposes of this section, including inappropriate actions taken to 

qualify as an exempt entity under subsection (c)(2)’’ after ‘‘section’’. 

(f) CONFORMING AMENDMENTS.— 

(1) Section 9010(a)(1) of this Act is amended by striking 

‘‘2009’’ and inserting ‘‘2010’’. 

(2) Section 9010(c)(2)(B) of this Act is amended by striking 

‘‘(except’’ and all that follows through ‘‘1323)’’. 

(3) Section 9010(c)(3) of this Act is amended by adding 

at the end the following new sentence: ‘‘If any entity described 

in subparagraph (C)(i)(I), (D)(i)(I), or (E)(i) of paragraph (2) 

is treated as a covered entity by reason of the application 

of the preceding sentence, the net premiums written with 

respect to health insurance for any United States health risk 

of such entity shall not be taken into account for purposes 

of this section.’’. 

(4) Section 9010(g)(1) of this Act is amended by striking 

‘‘and third party administration agreement fees’’. 

(5) Section 9010(j) of this Act is amended— 

(A) by striking ‘‘2008’’ and inserting ‘‘2009’’, and 

(B) by striking ‘‘, and any third party administration 

agreement fees received after such date’’. 

(g) EFFECTIVE DATE.—The amendments made by this section 

shall take effect as if included in the enactment of section 9010. 
H. R. 3590—902 

SEC. 10906. MODIFICATIONS TO ADDITIONAL HOSPITAL INSURANCE 

TAX ON HIGH-INCOME TAXPAYERS. 

(a) FICA.—Section 3101(b)(2) of the Internal Revenue Code 

of 1986, as added by section 9015(a)(1) of this Act, is amended 

by striking ‘‘0.5 percent’’ and inserting ‘‘0.9 percent’’. 

(b) SECA.—Section 1401(b)(2)(A) of the Internal Revenue Code 

of 1986, as added by section 9015(b)(1) of this Act, is amended 

by striking ‘‘0.5 percent’’ and inserting ‘‘0.9 percent’’. 

(c) EFFECTIVE DATE.—The amendments made by this section 

shall apply with respect to remuneration received, and taxable 

years beginning, after December 31, 2012. 

SEC. 10907. EXCISE TAX ON INDOOR TANNING SERVICES IN LIEU OF 

ELECTIVE COSMETIC MEDICAL PROCEDURES. 

(a) IN GENERAL.—The provisions of, and amendments made 

by, section 9017 of this Act are hereby deemed null, void, and 

of no effect. 

(b) EXCISE TAX ON INDOOR TANNING SERVICES.—Subtitle D 

of the Internal Revenue Code of 1986, as amended by this Act, 

is amended by adding at the end the following new chapter: 

‘‘CHAPTER 49—COSMETIC SERVICES 

‘‘Sec. 5000B. Imposition of tax on indoor tanning services. 

‘‘SEC. 5000B. IMPOSITION OF TAX ON INDOOR TANNING SERVICES. 

‘‘(a) IN GENERAL.—There is hereby imposed on any indoor tanning service a tax equal to 10 percent of the amount paid for 

such service (determined without regard to this section), whether 

paid by insurance or otherwise. 

‘‘(b) INDOOR TANNING SERVICE.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘indoor tanning service’ means 

a service employing any electronic product designed to incorporate 1 or more ultraviolet lamps and intended for the irradiation of an individual by ultraviolet radiation, with wavelengths 

in air between 200 and 400 nanometers, to induce skin tanning. 

‘‘(2) EXCLUSION OF PHOTOTHERAPY SERVICES.—Such term 

does not include any phototherapy service performed by a 

licensed medical professional. 

‘‘(c) PAYMENT OF TAX.— 

‘‘(1) IN GENERAL.—The tax imposed by this section shall 

be paid by the individual on whom the service is performed. 

‘‘(2) COLLECTION.—Every person receiving a payment for 

services on which a tax is imposed under subsection (a) shall 

collect the amount of the tax from the individual on whom 

the service is performed and remit such tax quarterly to the 

Secretary at such time and in such manner as provided by 

the Secretary. 

‘‘(3) SECONDARY LIABILITY.—Where any tax imposed by subsection (a) is not paid at the time payments for indoor tanning 

services are made, then to the extent that such tax is not 

collected, such tax shall be paid by the person who performs 

the service.’’. 

(c) CLERICAL AMENDMENT.—The table of chapter for subtitle 

D of the Internal Revenue Code of 1986, as amended by this 

Act, is amended by inserting after the item relating to chapter 

48 the following new item: 
H. R. 3590—903 

‘‘CHAPTER 49—COSMETIC SERVICES’’. 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to services performed on or after July 1, 2010. 

SEC. 10908. EXCLUSION FOR ASSISTANCE PROVIDED TO PARTICIPANTS 

IN STATE STUDENT LOAN REPAYMENT PROGRAMS FOR 

CERTAIN HEALTH PROFESSIONALS. 

(a) IN GENERAL.—Paragraph (4) of section 108(f) of the Internal 

Revenue Code of 1986 is amended to read as follows: 

‘‘(4) PAYMENTS UNDER NATIONAL HEALTH SERVICE CORPS

LOAN REPAYMENT PROGRAM AND CERTAIN STATE LOAN REPAY- MENT PROGRAMS.—In the case of an individual, gross income 

shall not include any amount received under section 338B(g) 

of the Public Health Service Act, under a State program 

described in section 338I of such Act, or under any other 

State loan repayment or loan forgiveness program that is 

intended to provide for the increased availability of health 

care services in underserved or health professional shortage 

areas (as determined by such State).’’. 

(b) EFFECTIVE DATE.—The amendment made by this section 

shall apply to amounts received by an individual in taxable years 

beginning after December 31, 2008. 

SEC. 10909. EXPANSION OF ADOPTION CREDIT AND ADOPTION ASSISTANCE PROGRAMS. 

(a) INCREASE IN DOLLAR LIMITATION.— (1) ADOPTION CREDIT.— (A) IN GENERAL.—Paragraph (1) of section 23(b) of 

the Internal Revenue Code of 1986 (relating to dollar 

limitation) is amended by striking ‘‘$10,000’’ and inserting 

‘‘$13,170’’. 

(B) CHILD WITH SPECIAL NEEDS.—Paragraph (3) of sec- tion 23(a) of such Code (relating to $10,000 credit for adoption of child with special needs regardless of expenses) 

is amended— 

(i) in the text by striking ‘‘$10,000’’ and inserting ‘‘$13,170’’, and 

(ii) in the heading by striking ‘‘$10,000’’ and 

inserting ‘‘$13,170’’. 

(C) CONFORMING AMENDMENT TO INFLATION ADJUST- MENT.—Subsection (h) of section 23 of such Code (relating 

to adjustments for inflation) is amended to read as follows: 

‘‘(h) ADJUSTMENTS FOR INFLATION.— ‘‘(1) DOLLAR LIMITATIONS.—In the case of a taxable year 

beginning after December 31, 2010, each of the dollar amounts 

in subsections (a)(3) and (b)(1) shall be increased by an amount 

equal to— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, determined by substituting ‘calendar year 

2009’ for ‘calendar year 1992’ in subparagraph (B) thereof. 

If any amount as increased under the preceding sentence is 

not a multiple of $10, such amount shall be rounded to the 

nearest multiple of $10. 

‘‘(2) INCOME LIMITATION.—In the case of a taxable year 

beginning after December 31, 2002, the dollar amount in subsection (b)(2)(A)(i) shall be increased by an amount equal to— 
H. R. 3590—904 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, determined by substituting ‘calendar year 

2001’ for ‘calendar year 1992’ in subparagraph (B) thereof. 

If any amount as increased under the preceding sentence is 

not a multiple of $10, such amount shall be rounded to the 

nearest multiple of $10.’’. 

(2) ADOPTION ASSISTANCE PROGRAMS.— 

(A) IN GENERAL.—Paragraph (1) of section 137(b) of 

the Internal Revenue Code of 1986 (relating to dollar 

limitation) is amended by striking ‘‘$10,000’’ and inserting 

‘‘$13,170’’. 

(B) CHILD WITH SPECIAL NEEDS.—Paragraph (2) of section 137(a) of such Code (relating to $10,000 exclusion 

for adoption of child with special needs regardless of 

expenses) is amended— 

(i) in the text by striking ‘‘$10,000’’ and inserting 

‘‘$13,170’’, and 

(ii) in the heading by striking ‘‘$10,000’’ and 

inserting ‘‘$13,170’’. 

(C) CONFORMING AMENDMENT TO INFLATION ADJUSTMENT.—Subsection (f) of section 137 of such Code (relating 

to adjustments for inflation) is amended to read as follows: 

‘‘(f) ADJUSTMENTS FOR INFLATION.— ‘‘(1) DOLLAR LIMITATIONS.—In the case of a taxable year 

beginning after December 31, 2010, each of the dollar amounts 

in subsections (a)(2) and (b)(1) shall be increased by an amount 

equal to— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, determined by substituting ‘calendar year 

2009’ for ‘calendar year 1992’ in subparagraph (B) thereof. 

If any amount as increased under the preceding sentence is 

not a multiple of $10, such amount shall be rounded to the 

nearest multiple of $10. 

‘‘(2) INCOME LIMITATION.—In the case of a taxable year 

beginning after December 31, 2002, the dollar amount in subsection (b)(2)(A) shall be increased by an amount equal to— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the cost-of-living adjustment determined under 

section 1(f)(3) for the calendar year in which the taxable 

year begins, determined by substituting ‘calendar year 

2001’ for ‘calendar year 1992’ in subparagraph thereof. 

If any amount as increased under the preceding sentence is 

not a multiple of $10, such amount shall be rounded to the 

nearest multiple of $10.’’. 

(b) CREDIT MADE REFUNDABLE.— (1) CREDIT MOVED TO SUBPART RELATING TO REFUNDABLE

CREDITS.—The Internal Revenue Code of 1986 is amended— 

(A) by redesignating section 23, as amended by subsection (a), as section 36C, and 

(B) by moving section 36C (as so redesignated) from 

subpart A of part IV of subchapter A of chapter 1 to 

the location immediately before section 37 in subpart C 

of part IV of subchapter A of chapter 1. 
H. R. 3590—905 

(2) CONFORMING AMENDMENTS.— 

(A) Section 24(b)(3)(B) of such Code is amended by 

striking ‘‘23,’’. 

(B) Section 25(e)(1)(C) of such Code is amended by 

striking ‘‘23,’’ both places it appears. 

(C) Section 25A(i)(5)(B) of such Code is amended by 

striking ‘‘23, 25D,’’ and inserting ‘‘25D’’. 

(D) Section 25B(g)(2) of such Code is amended by 

striking ‘‘23,’’. 

(E) Section 26(a)(1) of such Code is amended by striking 

‘‘23,’’. 

(F) Section 30(c)(2)(B)(ii) of such Code is amended by 

striking ‘‘23, 25D,’’ and inserting ‘‘25D’’. 

(G) Section 30B(g)(2)(B)(ii) of such Code is amended 

by striking ‘‘23,’’. 

(H) Section 30D(c)(2)(B)(ii) of such Code is amended 

by striking ‘‘sections 23 and’’ and inserting ‘‘section’’. 

(I) Section 36C of such Code, as so redesignated, is 

amended— 

(i) by striking paragraph (4) of subsection (b), and 

(ii) by striking subsection (c). 

(J) Section 137 of such Code is amended— 

(i) by striking ‘‘section 23(d)’’ in subsection (d) and 

inserting ‘‘section 36C(d)’’, and 

(ii) by striking ‘‘section 23’’ in subsection (e) and 

inserting ‘‘section 36C’’. 

(K) Section 904(i) of such Code is amended by striking 

‘‘23,’’. 

(L) Section 1016(a)(26) is amended by striking ‘‘23(g)’’ 

and inserting ‘‘36C(g)’’. 

(M) Section 1400C(d) of such Code is amended by 

striking ‘‘23,’’. 

(N) Section 6211(b)(4)(A) of such Code is amended by 

inserting ‘‘36C,’’ before ‘‘53(e)’’. 

(O) The table of sections for subpart A of part IV 

of subchapter A of chapter 1 of such Code of 1986 is 

amended by striking the item relating to section 23. 

(P) Paragraph (2) of section 1324(b) of title 31, United 

States Code, as amended by this Act, is amended by 

inserting ‘‘36C,’’ after ‘‘36B,’’. 

(Q) The table of sections for subpart C of part IV 

of subchapter A of chapter 1 of the Internal Revenue Code 

of 1986, as amended by this Act, is amended by inserting 

after the item relating to section 36B the following new 

item: 

‘‘Sec. 36C. Adoption expenses.’’. 

(c) APPLICATION AND EXTENSION OF EGTRRA SUNSET.—Notwithstanding section 901 of the Economic Growth and Tax Relief 

Reconciliation Act of 2001, such section shall apply to the amendments made by this section and the amendments made by section 

202 of such Act by substituting ‘‘December 31, 2011’’ for ‘‘December 

31, 2010’’ in subsection (a)(1) thereof. 
H. R. 3590—906 

(d) EFFECTIVE DATE.—The amendments made by this section 

shall apply to taxable years beginning after December 31, 2009. 

Speaker of the House of Representatives. 

Vice President of the United States and

President of the Senate.