VI 

Calendar No. 175 

AMENDMENT NO. 2786 

Purpose: In the nature of a substitute. 

IN THE SENATE OF THE UNITED STATES—111th Cong., 1st Sess. 

H. R. 3590 

To amend the Internal Revenue Code of 1986 to modify 

the first-time homebuyers credit in the case of members 

of the Armed Forces and certain other Federal employees, and for other purposes. 

November 19, 2009 

Ordered to lie on the table and to be printed 

Amendment in the nature of a substitute intended to be 

proposed by Mr. REID (for himself, Mr. BAUCUS, Mr. 

DODD, and Mr. HARKIN) 

Viz: 

1 Strike all after the enacting clause and insert the fol2 lowing: 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

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

5 ‘‘Patient Protection and Affordable Care Act’’. 

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

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—QUALITY, AFFORDABLE HEALTH CARE FOR ALL 

AMERICANS 


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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. 2701. Fair health insurance premiums. 

‘‘Sec. 2702. Guaranteed availability of coverage. 

‘‘Sec. 2703. Guaranteed renewability of coverage. 

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

‘‘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. 


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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 

cost-sharing reductions. 


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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. 

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. 

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 


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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. 

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) 


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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. 

Sec. 3026. Community-Based Care Transitions Program. 

Sec. 3027. Extension of gainsharing demonstration. 

Subtitle B—Improving Medicare for Patients and Providers 


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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. 


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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. 

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. 

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 lowincome 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 

long-term 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 out-of-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. 


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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. 

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. 

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. 


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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. 

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

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


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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 outpatient settings and allowing flexibility 

for jointly operated residency training programs. 

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 


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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. 

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. 


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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. 6607. Permitting evidentiary privilege and confidential 

cSec. 6606. MEWA plan registration with Department of 

Labor. 

ommunications. 

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. 

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. 


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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. 


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1 TITLE I—QUALITY, AFFORDABLE 

2 HEALTH CARE FOR ALL 

3 AMERICANS 

4 Subtitle A—Immediate Improve5 ments in Health Care Coverage 

6 for All Americans 

7 SEC. 1001. AMENDMENTS TO THE PUBLIC HEALTH SERVICE 

8 ACT. 

9 Part A of title XXVII of the Public Health Service 

10 Act (42 U.S.C. 300gg et seq.) is amended— 

11 (1) by striking the part heading and inserting 

12 the following: 

13 ‘‘PART A—INDIVIDUAL AND GROUP MARKET 

14 REFORMS’’; 

15 (2) by redesignating sections 2704 through 

16 2707 as sections 2725 through 2728, respectively; 

17 (3) by redesignating sections 2711 through 

18 2713 as sections 2731 through 2733, respectively; 

19 (4) by redesignating sections 2721 through 

20 2723 as sections 2735 through 2737, respectively; 

21 and 

22 (5) by inserting after section 2702, the fol23 lowing: 


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1 ‘‘Subpart II—Improving Coverage 

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

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

4 insurance issuer offering group or individual health insur5 ance coverage may not establish— 

6 ‘‘(1) lifetime limits on the dollar value of bene7 fits for any participant or beneficiary; or 

8 ‘‘(2) unreasonable annual limits (within the 

9 meaning of section 223 of the Internal Revenue 

10 Code of 1986) on the dollar value of benefits for any 

11 participant or beneficiary. 

12 ‘‘(b) PER BENEFICIARY LIMITS.—Subsection (a) 

13 shall not be construed to prevent a group health plan or 

14 health insurance coverage that is not required to provide 

15 essential health benefits under section 1302(b) of the Pa16 tient Protection and Affordable Care Act from placing an17 nual or lifetime per beneficiary limits on specific covered 

18 benefits to the extent that such limits are otherwise per19 mitted under Federal or State law. 

20 ‘‘SEC. 2712. PROHIBITION ON RESCISSIONS. 

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

22 offering group or individual health insurance coverage 

23 shall not rescind such plan or coverage with respect to an 

24 enrollee once the enrollee is covered under such plan or 

25 coverage involved, except that this section shall not apply 

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1 tice that constitutes fraud or makes an intentional mis2 representation of material fact as prohibited by the terms 

3 of the plan or coverage. Such plan or coverage may not 

4 be cancelled except with prior notice to the enrollee, and 

5 only as permitted under section 2702(c) or 2742(b). 

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

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

8 insurance issuer offering group or individual health insur9 ance coverage shall provide coverage for and shall not im10 pose any cost sharing requirements for— 

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

12 in effect a rating of ‘A’ or ‘B’ in the current rec13 ommendations of the United States Preventive Serv14 ices Task Force; 

15 ‘‘(2) immunizations that have in effect a rec16 ommendation from the Advisory Committee on Im17 munization Practices of the Centers for Disease 

18 Control and Prevention with respect to the indi19 vidual involved; and 

20 ‘‘(3) with respect to infants, children, and ado21 lescents, evidence-informed preventive care and 

22 screenings provided for in the comprehensive guide23 lines supported by the Health Resources and Serv24 ices Administration. 

25 ‘‘(b) INTERVAL.— 


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1 ‘‘(1) IN GENERAL.—The Secretary shall estab2 lish a minimum interval between the date on which 

3 a recommendation described in subsection (a)(1) or 

4 (a)(2) or a guideline under subsection (a)(3) is 

5 issued and the plan year with respect to which the 

6 requirement described in subsection (a) is effective 

7 with respect to the service described in such rec8 ommendation or guideline. 

9 ‘‘(2) MINIMUM.—The interval described in 

10 paragraph (1) shall not be less than 1 year. 

11 ‘‘(c) VALUE-BASED INSURANCE DESIGN.—The Sec12 retary may develop guidelines to permit a group health 

13 plan and a health insurance issuer offering group or indi14 vidual health insurance coverage to utilize value-based in15 surance designs. 

16 ‘‘SEC. 2714. EXTENSION OF DEPENDENT COVERAGE. 

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

18 insurance issuer offering group or individual health insur19 ance coverage that provides dependent coverage of chil20 dren shall continue to make such coverage available for 

21 an adult child (who is not married) until the child turns 

22 26 years of age. Nothing in this section shall require a 

23 health plan or a health insurance issuer described in the 

24 preceding sentence to make coverage available for a child 

25 of a child receiving dependent coverage. 


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1 ‘‘(b) REGULATIONS.—The Secretary shall promul2 gate regulations to define the dependents to which cov3 erage shall be made available under subsection (a). 

4 ‘‘(c) RULE OF CONSTRUCTION.—Nothing in this sec5 tion shall be construed to modify the definition of ‘depend6 ent’ as used in the Internal Revenue Code of 1986 with 

7 respect to the tax treatment of the cost of coverage. 

8 ‘‘SEC. 2715. DEVELOPMENT AND UTILIZATION OF UNIFORM 

9 EXPLANATION OF COVERAGE DOCUMENTS 

10 AND STANDARDIZED DEFINITIONS. 

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

12 the date of enactment of the Patient Protection and Af13 fordable Care Act, the Secretary shall develop standards 

14 for use by a group health plan and a health insurance 

15 issuer offering group or individual health insurance cov16 erage, in compiling and providing to enrollees a summary 

17 of benefits and coverage explanation that accurately de18 scribes the benefits and coverage under the applicable plan 

19 or coverage. In developing such standards, the Secretary 

20 shall consult with the National Association of Insurance 

21 Commissioners (referred to in this section as the ‘NAIC’), 

22 a working group composed of representatives of health in23 surance-related consumer advocacy organizations, health 

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1 cates including those representing individuals with limited 

2 English proficiency, and other qualified individuals. 

3 ‘‘(b) REQUIREMENTS.—The standards for the sum4 mary of benefits and coverage developed under subsection 

5 (a) shall provide for the following: 

6 ‘‘(1) APPEARANCE.—The standards shall en7 sure that the summary of benefits and coverage is 

8 presented in a uniform format that does not exceed 

9 4 pages in length and does not include print smaller 

10 than 12-point font. 

11 ‘‘(2) LANGUAGE.—The standards shall ensure 

12 that the summary is presented in a culturally and 

13 linguistically appropriate manner and utilizes termi14 nology understandable by the average plan enrollee. 

15 ‘‘(3) CONTENTS.—The standards shall ensure 

16 that the summary of benefits and coverage in17 cludes— 

18 ‘‘(A) uniform definitions of standard insur19 ance terms and medical terms (consistent with 

20 subsection (g)) so that consumers may compare 

21 health insurance coverage and understand the 

22 terms of coverage (or exception to such cov23 erage); 

24 ‘‘(B) a description of the coverage, includ25 ing cost sharing for— 


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1 ‘‘(i) each of the categories of the es2 sential health benefits described in sub3 paragraphs (A) through (J) of section 

4 1302(b)(1) of the Patient Protection and 

5 Affordable Care Act; and 

6 ‘‘(ii) other benefits, as identified by 

7 the Secretary; 

8 ‘‘(C) the exceptions, reductions, and limita9 tions on coverage; 

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

11 deductible, coinsurance, and co-payment obliga12 tions; 

13 ‘‘(E) the renewability and continuation of 

14 coverage provisions; 

15 ‘‘(F) a coverage facts label that includes 

16 examples to illustrate common benefits sce17 narios, including pregnancy and serious or 

18 chronic medical conditions and related cost 

19 sharing, such scenarios to be based on recog20 nized clinical practice guidelines; 

21 ‘‘(G) a statement of whether the plan or 

22 coverage— 

23 ‘‘(i) provides minimum essential cov24 erage (as defined under section 5000A(f) 

25 of the Internal Revenue Code 1986); and 


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1 ‘‘(ii) ensures that the plan or coverage 

2 share of the total allowed costs of benefits 

3 provided under the plan or coverage is not 

4 less than 60 percent of such costs; 

5 ‘‘(H) a statement that the outline is a 

6 summary of the policy or certificate and that 

7 the coverage document itself should be con8 sulted to determine the governing contractual 

9 provisions; and 

10 ‘‘(I) a contact number for the consumer to 

11 call with additional questions and an Internet 

12 web address where a copy of the actual indi13 vidual coverage policy or group certificate of 

14 coverage can be reviewed and obtained. 

15 ‘‘(c) PERIODIC REVIEW AND UPDATING.—The Sec16 retary shall periodically review and update, as appropriate, 

17 the standards developed under this section. 

18 ‘‘(d) REQUIREMENT TO PROVIDE.— 

19 ‘‘(1) IN GENERAL.—Not later than 24 months 

20 after the date of enactment of the Patient Protection 

21 and Affordable Care Act, each entity described in 

22 paragraph (3) shall provide, prior to any enrollment 

23 restriction, a summary of benefits and coverage ex24 planation pursuant to the standards developed by 

25 the Secretary under subsection (a) to— 


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1 ‘‘(A) an applicant at the time of applica2 tion; 

3 ‘‘(B) an enrollee prior to the time of enroll4 ment or reenrollment, as applicable; and 

5 ‘‘(C) a policyholder or certificate holder at 

6 the time of issuance of the policy or delivery of 

7 the certificate. 

8 ‘‘(2) COMPLIANCE.—An entity described in 

9 paragraph (3) is deemed to be in compliance with 

10 this section if the summary of benefits and coverage 

11 described in subsection (a) is provided in paper or 

12 electronic form. 

13 ‘‘(3) ENTITIES IN GENERAL.—An entity de14 scribed in this paragraph is— 

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

16 group health plan that is not a self-insured 

17 plan) offering health insurance coverage within 

18 the United States; or 

19 ‘‘(B) in the case of a self-insured group 

20 health plan, the plan sponsor or designated ad21 ministrator of the plan (as such terms are de22 fined in section 3(16) of the Employee Retire23 ment Income Security Act of 1974). 

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

25 health plan or health insurance issuer makes any 


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•AMDT. NO. 2786 

1 material modification in any of the terms of the plan 

2 or coverage involved (as defined for purposes of sec3 tion 102 of the Employee Retirement Income Secu4 rity Act of 1974) that is not reflected in the most 

5 recently provided summary of benefits and coverage, 

6 the plan or issuer shall provide notice of such modi7 fication to enrollees not later than 60 days prior to 

8 the date on which such modification will become ef9 fective. 

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

11 subsection (a) shall preempt any related State standards 

12 that require a summary of benefits and coverage that pro13 vides less information to consumers than that required to 

14 be provided under this section, as determined by the Sec15 retary. 

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

17 subsection (d)(3) that willfully fails to provide the infor18 mation required under this section shall be subject to a 

19 fine of not more than $1,000 for each such failure. Such 

20 failure with respect to each enrollee shall constitute a sep21 arate offense for purposes of this subsection. 

22 ‘‘(g) DEVELOPMENT OF STANDARD DEFINITIONS.— 

23 ‘‘(1) IN GENERAL.—The Secretary shall, by 

24 regulation, provide for the development of standards 

25 for the definitions of terms used in health insurance 


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1 coverage, including the insurance-related terms de2 scribed in paragraph (2) and the medical terms de3 scribed in paragraph (3). 

4 ‘‘(2) INSURANCE-RELATED TERMS.—The insur5 ance-related terms described in this paragraph are 

6 premium, deductible, co-insurance, co-payment, out7 of-pocket limit, preferred provider, non-preferred 

8 provider, out-of-network co-payments, UCR (usual, 

9 customary and reasonable) fees, excluded services, 

10 grievance and appeals, and such other terms as the 

11 Secretary determines are important to define so that 

12 consumers may compare health insurance coverage 

13 and understand the terms of their coverage. 

14 ‘‘(3) MEDICAL TERMS.—The medical terms de15 scribed in this paragraph are hospitalization, hos16 pital outpatient care, emergency room care, physi17 cian services, prescription drug coverage, durable 

18 medical equipment, home health care, skilled nursing 

19 care, rehabilitation services, hospice services, emer20 gency medical transportation, and such other terms 

21 as the Secretary determines are important to define 

22 so that consumers may compare the medical benefits 

23 offered by health insurance and understand the ex24 tent of those medical benefits (or exceptions to those 

25 benefits). 


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

2 SALARY. 

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

4 health plan (other than a self-insured plan) may not estab5 lish rules relating to the health insurance coverage eligi6 bility (including continued eligibility) of any full-time em7 ployee under the terms of the plan that are based on the 

8 total hourly or annual salary of the employee or otherwise 

9 establish eligibility rules that have the effect of discrimi10 nating in favor of higher wage employees. 

11 ‘‘(b) LIMITATION.—Subsection (a) shall not be con12 strued to prohibit a plan sponsor from establishing con13 tribution requirements for enrollment in the plan or cov14 erage that provide for the payment by employees with 

15 lower hourly or annual compensation of a lower dollar or 

16 percentage contribution than the payment required of 

17 similarly situated employees with a higher hourly or an18 nual compensation. 

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

20 ‘‘(a) QUALITY REPORTING.— 

21 ‘‘(1) IN GENERAL.—Not later than 2 years 

22 after the date of enactment of the Patient Protection 

23 and Affordable Care Act, the Secretary, in consulta24 tion with experts in health care quality and stake25 holders, shall develop reporting requirements for use 

26 by a group health plan, and a health insurance 


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•AMDT. NO. 2786 

1 issuer offering group or individual health insurance 

2 coverage, with respect to plan or coverage benefits 

3 and health care provider reimbursement structures 

4 that— 

5 ‘‘(A) improve health outcomes through the 

6 implementation of activities such as quality re7 porting, effective case management, care coordi8 nation, chronic disease management, and medi9 cation and care compliance initiatives, including 

10 through the use of the medical homes model as 

11 defined for purposes of section 3602 of the Pa12 tient Protection and Affordable Care Act, for 

13 treatment or services under the plan or cov14 erage; 

15 ‘‘(B) implement activities to prevent hos16 pital readmissions through a comprehensive 

17 program for hospital discharge that includes pa18 tient-centered education and counseling, com19 prehensive discharge planning, and post dis20 charge reinforcement by an appropriate health 

21 care professional; 

22 ‘‘(C) implement activities to improve pa23 tient safety and reduce medical errors through 

24 the appropriate use of best clinical practices, 


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•AMDT. NO. 2786 

1 evidence based medicine, and health informa2 tion technology under the plan or coverage; and 

3 ‘‘(D) implement wellness and health pro4 motion activities. 

5 ‘‘(2) REPORTING REQUIREMENTS.— 

6 ‘‘(A) IN GENERAL.—A group health plan 

7 and a health insurance issuer offering group or 

8 individual health insurance coverage shall annu9 ally submit to the Secretary, and to enrollees 

10 under the plan or coverage, a report on whether 

11 the benefits under the plan or coverage satisfy 

12 the elements described in subparagraphs (A) 

13 through (D) of paragraph (1). 

14 ‘‘(B) TIMING OF REPORTS.—A report 

15 under subparagraph (A) shall be made available 

16 to an enrollee under the plan or coverage dur17 ing each open enrollment period. 

18 ‘‘(C) AVAILABILITY OF REPORTS.—The 

19 Secretary shall make reports submitted under 

20 subparagraph (A) available to the public 

21 through an Internet website 

22 ‘‘(D) PENALTIES.—In developing the re23 porting requirements under paragraph (1), the 

24 Secretary may develop and impose appropriate 


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1 penalties for non-compliance with such require2 ments. 

3 ‘‘(E) EXCEPTIONS.—In developing the re4 porting requirements under paragraph (1), the 

5 Secretary may provide for exceptions to such 

6 requirements for group health plans and health 

7 insurance issuers that substantially meet the 

8 goals of this section. 

9 ‘‘(b) WELLNESS AND PREVENTION PROGRAMS.—For 

10 purposes of subsection (a)(1)(D), wellness and health pro11 motion activities may include personalized wellness and 

12 prevention services, which are coordinated, maintained or 

13 delivered by a health care provider, a wellness and preven14 tion plan manager, or a health, wellness or prevention 

15 services organization that conducts health risk assess16 ments or offers ongoing face-to-face, telephonic or web17 based intervention efforts for each of the program’s par18 ticipants, and which may include the following wellness 

19 and prevention efforts: 

20 ‘‘(1) Smoking cessation. 

21 ‘‘(2) Weight management. 

22 ‘‘(3) Stress management. 

23 ‘‘(4) Physical fitness. 

24 ‘‘(5) Nutrition. 

25 ‘‘(6) Heart disease prevention. 


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1 ‘‘(7) Healthy lifestyle support. 

2 ‘‘(8) Diabetes prevention. 

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

4 date of enactment of the Patient Protection and Afford5 able Care Act, the Secretary shall promulgate regulations 

6 that provide criteria for determining whether a reimburse7 ment structure is described in subsection (a). 

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

9 after the date on which regulations are promulgated under 

10 subsection (c), the Government Accountability Office shall 

11 review such regulations and conduct a study and submit 

12 to the Committee on Health, Education, Labor, and Pen13 sions of the Senate and the Committee on Energy and 

14 Commerce of the House of Representatives a report re15 garding the impact the activities under this section have 

16 had on the quality and cost of health care. 

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

18 COVERAGE. 

19 ‘‘(a) CLEAR ACCOUNTING FOR COSTS.—A health in20 surance issuer offering group or individual health insur21 ance coverage shall, with respect to each plan year, submit 

22 to the Secretary a report concerning the percentage of 

23 total premium revenue that such coverage expends— 

24 ‘‘(1) on reimbursement for clinical services pro25 vided to enrollees under such coverage; 


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1 ‘‘(2) for activities that improve health care 

2 quality; and 

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

4 explanation of the nature of such costs, and exclud5 ing State taxes and licensing or regulatory fees. 

6 The Secretary shall make reports received under this sec7 tion available to the public on the Internet website of the 

8 Department of Health and Human Services. 

9 ‘‘(b) ENSURING THAT CONSUMERS RECEIVE VALUE

10 FOR THEIR PREMIUM PAYMENTS.— 

11 ‘‘(1) REQUIREMENT TO PROVIDE VALUE FOR

12 PREMIUM PAYMENTS.—A health insurance issuer of13 fering group or individual health insurance coverage 

14 shall, with respect to each plan year, provide an an15 nual rebate to each enrollee under such coverage, on 

16 a pro rata basis, in an amount that is equal to the 

17 amount by which premium revenue expended by the 

18 issuer on activities described in subsection (a)(3) ex19 ceeds— 

20 ‘‘(A) with respect to a health insurance 

21 issuer offering coverage in the group market, 

22 20 percent, or such lower percentage as a State 

23 may by regulation determine; or 

24 ‘‘(B) with respect to a health insurance 

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1 ket, 25 percent, or such lower percentage as a 

2 State may by regulation determine, except that 

3 such percentage shall be adjusted to the extent 

4 the Secretary determines that the application of 

5 such percentage with a State may destabilize 

6 the existing individual market in such State. 

7 ‘‘(2) CONSIDERATION IN SETTING PERCENT8 AGES.—In determining the percentages under para9 graph (1), a State shall seek to ensure adequate par10 ticipation by health insurance issuers, competition in 

11 the health insurance market in the State, and value 

12 for consumers so that premiums are used for clinical 

13 services and quality improvements. 

14 ‘‘(3) TERMINATION.—The provisions of this 

15 subsection shall have no force or effect after Decem16 ber 31, 2013. 

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

18 operating within the United States shall for each year es19 tablish (and update) and make public (in accordance with 

20 guidelines developed by the Secretary) a list of the hos21 pital’s standard charges for items and services provided 

22 by the hospital, including for diagnosis-related groups es23 tablished under section 1886(d)(4) of the Social Security 

24 Act. 


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

2 with the National Association of Insurance Commissions, 

3 shall establish uniform definitions for the activities re4 ported under subsection (a). 

5 ‘‘SEC. 2719. APPEALS PROCESS. 

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

7 offering group or individual health insurance coverage 

8 shall implement an effective appeals process for appeals 

9 of coverage determinations and claims, under which the 

10 plan or issuer shall, at a minimum— 

11 ‘‘(1) have in effect an internal claims appeal 

12 process; 

13 ‘‘(2) provide notice to enrollees, in a culturally 

14 and linguistically appropriate manner, of available 

15 internal and external appeals processes, and the 

16 availability of any applicable office of health insur17 ance consumer assistance or ombudsman established 

18 under section 2793 to assist such enrollees with the 

19 appeals processes; 

20 ‘‘(3) allow an enrollee to review their file, to 

21 present evidence and testimony as part of the ap22 peals process, and to receive continued coverage 

23 pending the outcome of the appeals process; and 

24 ‘‘(4) provide an external review process for such 

25 plans and issuers that, at a minimum, includes the 


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1 consumer protections set forth in the Uniform Ex2 ternal Review Model Act promulgated by the Na3 tional Association of Insurance Commissioners and 

4 is binding on such plans.’’. 

5 SEC. 1002. HEALTH INSURANCE CONSUMER INFORMATION. 

6 Part C of title XXVII of the Public Health Service 

7 Act (42 U.S.C. 300gg-91 et seq.) is amended by adding 

8 at the end the following: 

9 ‘‘SEC. 2793. HEALTH INSURANCE CONSUMER INFORMA10 TION. 

11 ‘‘(a) IN GENERAL.—The Secretary shall award 

12 grants to States to enable such States (or the Exchanges 

13 operating in such States) to establish, expand, or provide 

14 support for— 

15 ‘‘(1) offices of health insurance consumer as16 sistance; or 

17 ‘‘(2) health insurance ombudsman programs. 

18 ‘‘(b) ELIGIBILITY.— 

19 ‘‘(1) IN GENERAL.—To be eligible to receive a 

20 grant, a State shall designate an independent office 

21 of health insurance consumer assistance, or an om22 budsman, that, directly or in coordination with State 

23 health insurance regulators and consumer assistance 

24 organizations, receives and responds to inquiries and 

25 complaints concerning health insurance coverage 


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1 with respect to Federal health insurance require2 ments and under State law. 

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

4 under this section shall comply with criteria estab5 lished by the Secretary for carrying out activities 

6 under such grant. 

7 ‘‘(c) DUTIES.—The office of health insurance con8 sumer assistance or health insurance ombudsman shall— 

9 ‘‘(1) assist with the filing of complaints and ap10 peals, including filing appeals with the internal ap11 peal or grievance process of the group health plan or 

12 health insurance issuer involved and providing infor13 mation about the external appeal process; 

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

15 inquiries encountered by consumers; 

16 ‘‘(3) educate consumers on their rights and re17 sponsibilities with respect to group health plans and 

18 health insurance coverage; 

19 ‘‘(4) assist consumers with enrollment in a 

20 group health plan or health insurance coverage by 

21 providing information, referral, and assistance; and 

22 ‘‘(5) resolve problems with obtaining premium 

23 tax credits under section 36B of the Internal Rev24 enue Code of 1986. 


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

2 a grant under subsection (a), an office of health insurance 

3 consumer assistance or ombudsman program shall be re4 quired to collect and report data to the Secretary on the 

5 types of problems and inquiries encountered by con6 sumers. The Secretary shall utilize such data to identify 

7 areas where more enforcement action is necessary and 

8 shall share such information with State insurance regu9 lators, the Secretary of Labor, and the Secretary of the 

10 Treasury for use in the enforcement activities of such 

11 agencies. 

12 ‘‘(e) FUNDING.— 

13 ‘‘(1) INITIAL FUNDING.—There is hereby ap14 propriated to the Secretary, out of any funds in the 

15 Treasury not otherwise appropriated, $30,000,000 

16 for the first fiscal year for which this section applies 

17 to carry out this section. Such amount shall remain 

18 available without fiscal year limitation. 

19 ‘‘(2) AUTHORIZATION FOR SUBSEQUENT

20 YEARS.—There is authorized to be appropriated to 

21 the Secretary for each fiscal year following the fiscal 

22 year described in paragraph (1), such sums as may 

23 be necessary to carry out this section.’’. 


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1 SEC. 1003. ENSURING THAT CONSUMERS GET VALUE FOR 

2 THEIR DOLLARS. 

3 Part C of title XXVII of the Public Health Service 

4 Act (42 U.S.C. 300gg-91 et seq.), as amended by section 

5 1002, is further amended by adding at the end the fol6 lowing: 

7 ‘‘SEC. 2794. ENSURING THAT CONSUMERS GET VALUE FOR 

8 THEIR DOLLARS. 

9 ‘‘(a) INITIAL PREMIUM REVIEW PROCESS.— 

10 ‘‘(1) IN GENERAL.—The Secretary, in conjunc11 tion with States, shall establish a process for the an12 nual review, beginning with the 2010 plan year and 

13 subject to subsection (b)(2)(A), of unreasonable in14 creases in premiums for health insurance coverage. 

15 ‘‘(2) JUSTIFICATION AND DISCLOSURE.—The 

16 process established under paragraph (1) shall re17 quire health insurance issuers to submit to the Sec18 retary and the relevant State a justification for an 

19 unreasonable premium increase prior to the imple20 mentation of the increase. Such issuers shall promi21 nently post such information on their Internet 

22 websites. The Secretary shall ensure the public dis23 closure of information on such increases and jus24 tifications for all health insurance issuers. 

25 ‘‘(b) CONTINUING PREMIUM REVIEW PROCESS.— 


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1 ‘‘(1) INFORMING SECRETARY OF PREMIUM IN2 CREASE PATTERNS.—As a condition of receiving a 

3 grant under subsection (c)(1), a State, through its 

4 Commissioner of Insurance, shall— 

5 ‘‘(A) provide the Secretary with informa6 tion about trends in premium increases in 

7 health insurance coverage in premium rating 

8 areas in the State; and 

9 ‘‘(B) make recommendations, as appro10 priate, to the State Exchange about whether 

11 particular health insurance issuers should be 

12 excluded from participation in the Exchange 

13 based on a pattern or practice of excessive or 

14 unjustified premium increases. 

15 ‘‘(2) MONITORING BY SECRETARY OF PREMIUM

16 INCREASES.— 

17 ‘‘(A) IN GENERAL.—Beginning with plan 

18 years beginning in 2014, the Secretary, in con19 junction with the States and consistent with the 

20 provisions of subsection (a)(2), shall monitor 

21 premium increases of health insurance coverage 

22 offered through an Exchange and outside of an 

23 Exchange. 

24 ‘‘(B) CONSIDERATION IN OPENING EX25 CHANGE.—In determining under section 


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1 1312(f)(2)(B) of the Patient Protection and Af2 fordable Care Act whether to offer qualified 

3 health plans in the large group market through 

4 an Exchange, the State shall take into account 

5 any excess of premium growth outside of the 

6 Exchange as compared to the rate of such 

7 growth inside the Exchange. 

8 ‘‘(c) GRANTS IN SUPPORT OF PROCESS.— 

9 ‘‘(1) PREMIUM REVIEW GRANTS DURING 2010

10 THROUGH 2014.—The Secretary shall carry out a 

11 program to award grants to States during the 5-year 

12 period beginning with fiscal year 2010 to assist such 

13 States in carrying out subsection (a), including— 

14 ‘‘(A) in reviewing and, if appropriate under 

15 State law, approving premium increases for 

16 health insurance coverage; and 

17 ‘‘(B) in providing information and rec18 ommendations to the Secretary under sub19 section (b)(1). 

20 ‘‘(2) FUNDING.— 

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

22 Treasury not otherwise appropriated, there are 

23 appropriated to the Secretary $250,000,000, to 

24 be available for expenditure for grants under 

25 paragraph (1) and subparagraph (B). 


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1 ‘‘(B) FURTHER AVAILABILITY FOR INSUR2 ANCE REFORM AND CONSUMER PROTECTION.— 

3 If the amounts appropriated under subpara4 graph (A) are not fully obligated under grants 

5 under paragraph (1) by the end of fiscal year 

6 2014, any remaining funds shall remain avail7 able to the Secretary for grants to States for 

8 planning and implementing the insurance re9 forms and consumer protections under part A. 

10 ‘‘(C) ALLOCATION.—The Secretary shall 

11 establish a formula for determining the amount 

12 of any grant to a State under this subsection. 

13 Under such formula— 

14 ‘‘(i) the Secretary shall consider the 

15 number of plans of health insurance cov16 erage offered in each State and the popu17 lation of the State; and 

18 ‘‘(ii) no State qualifying for a grant 

19 under paragraph (1) shall receive less than 

20 $1,000,000, or more than $5,000,000 for a 

21 grant year.’’. 

22 SEC. 1004. EFFECTIVE DATES. 

23 (a) IN GENERAL.—Except as provided for in sub24 section (b), this subtitle (and the amendments made by 

25 this subtitle) shall become effective for plan years beginVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00040 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ning on or after the date that is 6 months after the date 

2 of enactment of this Act, except that the amendments 

3 made by sections 1002 and 1003 shall become effective 

4 for fiscal years beginning with fiscal year 2010. 

5 (b) SPECIAL RULE.—The amendments made by sec6 tions 1002 and 1003 shall take effect on the date of enact7 ment of this Act. 

8 Subtitle B—Immediate Actions to 

9 Preserve and Expand Coverage 

10 SEC. 1101. IMMEDIATE ACCESS TO INSURANCE FOR UNIN11 SURED INDIVIDUALS WITH A PREEXISTING 

12 CONDITION. 

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

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

15 a temporary high risk health insurance pool program to 

16 provide health insurance coverage for eligible individuals 

17 during the period beginning on the date on which such 

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

19 (b) ADMINISTRATION.— 

20 (1) IN GENERAL.—The Secretary may carry out 

21 the program under this section directly or through 

22 contracts to eligible entities. 

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

24 contract under paragraph (1), an entity shall— 

25 (A) be a State or nonprofit private entity; 


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1 (B) submit to the Secretary an application 

2 at such time, in such manner, and containing 

3 such information as the Secretary may require; 

4 and 

5 (C) agree to utilize contract funding to es6 tablish and administer a qualified high risk pool 

7 for eligible individuals. 

8 (3) MAINTENANCE OF EFFORT.—To be eligible 

9 to enter into a contract with the Secretary under 

10 this subsection, a State shall agree not to reduce the 

11 annual amount the State expended for the operation 

12 of one or more State high risk pools during the year 

13 preceding the year in which such contract is entered 

14 into. 

15 (c) QUALIFIED HIGH RISK POOL.— 

16 (1) IN GENERAL.—Amounts made available 

17 under this section shall be used to establish a quali18 fied high risk pool that meets the requirements of 

19 paragraph (2). 

20 (2) REQUIREMENTS.—A qualified high risk pool 

21 meets the requirements of this paragraph if such 

22 pool— 

23 (A) provides to all eligible individuals 

24 health insurance coverage that does not impose 


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1 any preexisting condition exclusion with respect 

2 to such coverage; 

3 (B) provides health insurance coverage— 

4 (i) in which the issuer’s share of the 

5 total allowed costs of benefits provided 

6 under such coverage is not less than 65 

7 percent of such costs; and 

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

9 greater than the applicable amount de10 scribed in section 223(c)(2) of the Internal 

11 Revenue Code of 1986 for the year in12 volved, except that the Secretary may mod13 ify such limit if necessary to ensure the 

14 pool meets the actuarial value limit under 

15 clause (i); 

16 (C) ensures that with respect to the pre17 mium rate charged for health insurance cov18 erage offered to eligible individuals through the 

19 high risk pool, such rate shall— 

20 (i) except as provided in clause (ii), 

21 vary only as provided for under section 

22 2701 of the Public Health Service Act (as 

23 amended by this Act and notwithstanding 

24 the date on which such amendments take 

25 effect); 


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1 (ii) vary on the basis of age by a fac2 tor of not greater than 4 to 1; and 

3 (iii) be established at a standard rate 

4 for a standard population; and 

5 (D) meets any other requirements deter6 mined appropriate by the Secretary. 

7 (d) ELIGIBLE INDIVIDUAL.—An individual shall be 

8 deemed to be an eligible individual for purposes of this 

9 section if such individual— 

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

11 or is lawfully present in the United States (as deter12 mined in accordance with section 1411); 

13 (2) has not been covered under creditable cov14 erage (as defined in section 2701(c)(1) of the Public 

15 Health Service Act as in effect on the date of enact16 ment of this Act) during the 6-month period prior 

17 to the date on which such individual is applying for 

18 coverage through the high risk pool; and 

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

20 in a manner consistent with guidance issued by the 

21 Secretary. 

22 (e) PROTECTION AGAINST DUMPING RISK BY INSUR23 ERS.— 

24 (1) IN GENERAL.—The Secretary shall establish 

25 criteria for determining whether health insurance 


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1 issuers and employment-based health plans have dis2 couraged an individual from remaining enrolled in 

3 prior coverage based on that individual’s health sta4 tus. 

5 (2) SANCTIONS.—An issuer or employment6 based health plan shall be responsible for reimburs7 ing the program under this section for the medical 

8 expenses incurred by the program for an individual 

9 who, based on criteria established by the Secretary, 

10 the Secretary finds was encouraged by the issuer to 

11 disenroll from health benefits coverage prior to en12 rolling in coverage through the program. The cri13 teria shall include at least the following cir14 cumstances: 

15 (A) In the case of prior coverage obtained 

16 through an employer, the provision by the em17 ployer, group health plan, or the issuer of 

18 money or other financial consideration for 

19 disenrolling from the coverage. 

20 (B) In the case of prior coverage obtained 

21 directly from an issuer or under an employ22 ment-based health plan— 

23 (i) the provision by the issuer or plan 

24 of money or other financial consideration 

25 for disenrolling from the coverage; or 


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1 (ii) in the case of an individual whose 

2 premium for the prior coverage exceeded 

3 the premium required by the program (ad4 justed based on the age factors applied to 

5 the prior coverage)— 

6 (I) the prior coverage is a policy 

7 that is no longer being actively mar8 keted (as defined by the Secretary) by 

9 the issuer; or 

10 (II) the prior coverage is a policy 

11 for which duration of coverage form 

12 issue or health status are factors that 

13 can be considered in determining pre14 miums at renewal. 

15 (3) CONSTRUCTION.—Nothing in this sub16 section shall be construed as constituting exclusive 

17 remedies for violations of criteria established under 

18 paragraph (1) or as preventing States from applying 

19 or enforcing such paragraph or other provisions 

20 under law with respect to health insurance issuers. 

21 (f) OVERSIGHT.—The Secretary shall establish— 

22 (1) an appeals process to enable individuals to 

23 appeal a determination under this section; and 

24 (2) procedures to protect against waste, fraud, 

25 and abuse. 


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1 (g) FUNDING; TERMINATION OF AUTHORITY.— 

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

3 Secretary, out of any moneys in the Treasury not 

4 otherwise appropriated, $5,000,000,000 to pay 

5 claims against (and the administrative costs of) the 

6 high risk pool under this section that are in excess 

7 of the amount of premiums collected from eligible in8 dividuals enrolled in the high risk pool. Such funds 

9 shall be available without fiscal year limitation. 

10 (2) INSUFFICIENT FUNDS.—If the Secretary es11 timates for any fiscal year that the aggregate 

12 amounts available for the payment of the expenses 

13 of the high risk pool will be less than the actual 

14 amount of such expenses, the Secretary shall make 

15 such adjustments as are necessary to eliminate such 

16 deficit. 

17 (3) TERMINATION OF AUTHORITY.— 

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

19 subparagraph (B), coverage of eligible individ20 uals under a high risk pool in a State shall ter21 minate on January 1, 2014. 

22 (B) TRANSITION TO EXCHANGE.—The 

23 Secretary shall develop procedures to provide 

24 for the transition of eligible individuals enrolled 

25 in health insurance coverage offered through a 


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1 high risk pool established under this section 

2 into qualified health plans offered through an 

3 Exchange. Such procedures shall ensure that 

4 there is no lapse in coverage with respect to the 

5 individual and may extend coverage after the 

6 termination of the risk pool involved, if the Sec7 retary determines necessary to avoid such a 

8 lapse. 

9 (4) LIMITATIONS.—The Secretary has the au10 thority to stop taking applications for participation 

11 in the program under this section to comply with the 

12 funding limitation provided for in paragraph (1). 

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

14 established under this section shall supersede any 

15 State law or regulation (other than State licensing 

16 laws or State laws relating to plan solvency) with re17 spect to qualified high risk pools which are estab18 lished in accordance with this section. 

19 SEC. 1102. REINSURANCE FOR EARLY RETIREES. 

20 (a) ADMINISTRATION.— 

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

22 the date of enactment of this Act, the Secretary 

23 shall establish a temporary reinsurance program to 

24 provide reimbursement to participating employment25 based plans for a portion of the cost of providing 


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1 health insurance coverage to early retirees (and to 

2 the eligible spouses, surviving spouses, and depend3 ents of such retirees) during the period beginning on 

4 the date on which such program is established and 

5 ending on January 1, 2014. 

6 (2) REFERENCE.—In this section: 

7 (A) HEALTH BENEFITS.—The term 

8 ‘‘health benefits’’ means medical, surgical, hos9 pital, prescription drug, and such other benefits 

10 as shall be determined by the Secretary, wheth11 er self-funded, or delivered through the pur12 chase of insurance or otherwise. 

13 (B) EMPLOYMENT-BASED PLAN.—The 

14 term ‘‘employment-based plan’’ means a group 

15 health benefits plan that— 

16 (i) is— 

17 (I) maintained by one or more 

18 current or former employers (includ19 ing without limitation any State or 

20 local government or political subdivi21 sion thereof), employee organization, a 

22 voluntary employees’ beneficiary asso23 ciation, or a committee or board of in24 dividuals appointed to administer such 

25 plan; or 


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1 (II) a multiemployer plan (as de2 fined in section 3(37) of the Employee 

3 Retirement Income Security Act of 

4 1974); and 

5 (ii) provides health benefits to early 

6 retirees. 

7 (C) EARLY RETIREES.—The term ‘‘early 

8 retirees’’ means individuals who are age 55 and 

9 older but are not eligible for coverage under 

10 title XVIII of the Social Security Act, and who 

11 are not active employees of an employer main12 taining, or currently contributing to, the em13 ployment-based plan or of any employer that 

14 has made substantial contributions to fund such 

15 plan. 

16 (b) PARTICIPATION.— 

17 (1) EMPLOYMENT-BASED PLAN ELIGIBILITY.— 

18 A participating employment-based plan is an em19 ployment-based plan that— 

20 (A) meets the requirements of paragraph 

21 (2) with respect to health benefits provided 

22 under the plan; and 

23 (B) submits to the Secretary an applica24 tion for participation in the program, at such 


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1 time, in such manner, and containing such in2 formation as the Secretary shall require. 

3 (2) EMPLOYMENT-BASED HEALTH BENEFITS.— 

4 An employment-based plan meets the requirements 

5 of this paragraph if the plan— 

6 (A) implements programs and procedures 

7 to generate cost-savings with respect to partici8 pants with chronic and high-cost conditions; 

9 (B) provides documentation of the actual 

10 cost of medical claims involved; and 

11 (C) is certified by the Secretary. 

12 (c) PAYMENTS.— 

13 (1) SUBMISSION OF CLAIMS.— 

14 (A) IN GENERAL.—A participating employ15 ment-based plan shall submit claims for reim16 bursement to the Secretary which shall contain 

17 documentation of the actual costs of the items 

18 and services for which each claim is being sub19 mitted. 

20 (B) BASIS FOR CLAIMS.—Claims submitted 

21 under subparagraph (A) shall be based on the 

22 actual amount expended by the participating 

23 employment-based plan involved within the plan 

24 year for the health benefits provided to an early 

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1 pendent of such retiree. In determining the 

2 amount of a claim for purposes of this sub3 section, the participating employment-based 

4 plan shall take into account any negotiated 

5 price concessions (such as discounts, direct or 

6 indirect subsidies, rebates, and direct or indi7 rect remunerations) obtained by such plan with 

8 respect to such health benefit. For purposes of 

9 determining the amount of any such claim, the 

10 costs paid by the early retiree or the retiree’s 

11 spouse, surviving spouse, or dependent in the 

12 form of deductibles, co-payments, or co-insur13 ance shall be included in the amounts paid by 

14 the participating employment-based plan. 

15 (2) PROGRAM PAYMENTS.—If the Secretary de16 termines that a participating employment-based plan 

17 has submitted a valid claim under paragraph (1), 

18 the Secretary shall reimburse such plan for 80 per19 cent of that portion of the costs attributable to such 

20 claim that exceed $15,000, subject to the limits con21 tained in paragraph (3). 

22 (3) LIMIT.—To be eligible for reimbursement 

23 under the program, a claim submitted by a partici24 pating employment-based plan shall not be less than 

25 $15,000 nor greater than $90,000. Such amounts 


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1 shall be adjusted each fiscal year based on the per2 centage increase in the Medical Care Component of 

3 the Consumer Price Index for all urban consumers 

4 (rounded to the nearest multiple of $1,000) for the 

5 year involved. 

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

7 participating employment-based plan under this sub8 section shall be used to lower costs for the plan. 

9 Such payments may be used to reduce premium 

10 costs for an entity described in subsection 

11 (a)(2)(B)(i) or to reduce premium contributions, co12 payments, deductibles, co-insurance, or other out-of13 pocket costs for plan participants. Such payments 

14 shall not be used as general revenues for an entity 

15 described in subsection (a)(2)(B)(i). The Secretary 

16 shall develop a mechanism to monitor the appro17 priate use of such payments by such entities. 

18 (5) PAYMENTS NOT TREATED AS INCOME.— 

19 Payments received under this subsection shall not be 

20 included in determining the gross income of an enti21 ty described in subsection (a)(2)(B)(i) that is main22 taining or currently contributing to a participating 

23 employment-based plan. 

24 (6) APPEALS.—The Secretary shall establish— 


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1 (A) an appeals process to permit partici2 pating employment-based plans to appeal a de3 termination of the Secretary with respect to 

4 claims submitted under this section; and 

5 (B) procedures to protect against fraud, 

6 waste, and abuse under the program. 

7 (d) AUDITS.—The Secretary shall conduct annual au8 dits of claims data submitted by participating employ9 ment-based plans under this section to ensure that such 

10 plans are in compliance with the requirements of this sec11 tion. 

12 (e) FUNDING.—There is appropriated to the Sec13 retary, out of any moneys in the Treasury not otherwise 

14 appropriated, $5,000,000,000 to carry out the program 

15 under this section. Such funds shall be available without 

16 fiscal year limitation. 

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

18 stop taking applications for participation in the program 

19 based on the availability of funding under subsection (e). 

20 SEC. 1103. IMMEDIATE INFORMATION THAT ALLOWS CON21 SUMERS TO IDENTIFY AFFORDABLE COV22 ERAGE OPTIONS. 

23 (a) INTERNET PORTAL TO AFFORDABLE COVERAGE

24 OPTIONS.— 


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1 (1) IMMEDIATE ESTABLISHMENT.—Not later 

2 than July 1, 2010, the Secretary, in consultation 

3 with the States, shall establish a mechanism, includ4 ing an Internet website, through which a resident of 

5 any State may identify affordable health insurance 

6 coverage options in that State. 

7 (2) CONNECTING TO AFFORDABLE COV8 ERAGE.—An Internet website established under 

9 paragraph (1) shall, to the extent practicable, pro10 vide ways for residents of any State to receive infor11 mation on at least the following coverage options: 

12 (A) Health insurance coverage offered by 

13 health insurance issuers, other than coverage 

14 that provides reimbursement only for the treat15 ment or mitigation of— 

16 (i) a single disease or condition; or 

17 (ii) an unreasonably limited set of dis18 eases or conditions (as determined by the 

19 Secretary); 

20 (B) Medicaid coverage under title XIX of 

21 the Social Security Act. 

22 (C) Coverage under title XXI of the Social 

23 Security Act. 


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1 (D) A State health benefits high risk pool, 

2 to the extent that such high risk pool is offered 

3 in such State; and 

4 (E) Coverage under a high risk pool under 

5 section 1101. 

6 (b) ENHANCING COMPARATIVE PURCHASING OP7 TIONS.— 

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

9 the date of enactment of this Act, the Secretary 

10 shall develop a standardized format to be used for 

11 the presentation of information relating to the cov12 erage options described in subsection (a)(2). Such 

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

14 information on the percentage of total premium rev15 enue expended on nonclinical costs (as reported 

16 under section 2718(a) of the Public Health Service 

17 Act), eligibility, availability, premium rates, and cost 

18 sharing with respect to such coverage options and be 

19 consistent with the standards adopted for the uni20 form explanation of coverage as provided for in sec21 tion 2715 of the Public Health Service Act. 

22 (2) USE OF FORMAT.—The Secretary shall uti23 lize the format developed under paragraph (1) in 

24 compiling information concerning coverage options 


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1 on the Internet website established under subsection 

2 (a). 

3 (c) AUTHORITY TO CONTRACT.—The Secretary may 

4 carry out this section through contracts entered into with 

5 qualified entities. 

6 SEC. 1104. ADMINISTRATIVE SIMPLIFICATION. 

7 (a) PURPOSE OF ADMINISTRATIVE SIMPLIFICA8 TION.—Section 261 of the Health Insurance Portability 

9 and Accountability Act of 1996 (42 U.S.C. 1320d note) 

10 is amended— 

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

12 and 

13 (2) by inserting ‘‘and to reduce the clerical bur14 den on patients, health care providers, and health 

15 plans’’ before the period at the end. 

16 (b) OPERATING RULES FOR HEALTH INFORMATION

17 TRANSACTIONS.— 

18 (1) DEFINITION OF OPERATING RULES.—Sec19 tion 1171 of the Social Security Act (42 U.S.C. 

20 1320d) is amended by adding at the end the fol21 lowing: 

22 ‘‘(9) OPERATING RULES.—The term ‘operating 

23 rules’ means the necessary business rules and guide24 lines for the electronic exchange of information that 


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1 are not defined by a standard or its implementation 

2 specifications as adopted for purposes of this part.’’. 

3 (2) TRANSACTION STANDARDS; OPERATING

4 RULES AND COMPLIANCE.—Section 1173 of the So5 cial Security Act (42 U.S.C. 1320d–2) is amended— 

6 (A) in subsection (a)(2), by adding at the 

7 end the following new subparagraph: 

8 ‘‘(J) Electronic funds transfers.’’; 

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

10 the following new paragraph: 

11 ‘‘(4) REQUIREMENTS FOR FINANCIAL AND AD12 MINISTRATIVE TRANSACTIONS.— 

13 ‘‘(A) IN GENERAL.—The standards and as14 sociated operating rules adopted by the Sec15 retary shall— 

16 ‘‘(i) to the extent feasible and appro17 priate, enable determination of an individ18 ual’s eligibility and financial responsibility 

19 for specific services prior to or at the point 

20 of care; 

21 ‘‘(ii) be comprehensive, requiring 

22 minimal augmentation by paper or other 

23 communications; 

24 ‘‘(iii) provide for timely acknowledg25 ment, response, and status reporting that 


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1 supports a transparent claims and denial 

2 management process (including adjudica3 tion and appeals); and 

4 ‘‘(iv) describe all data elements (in5 cluding reason and remark codes) in un6 ambiguous terms, require that such data 

7 elements be required or conditioned upon 

8 set values in other fields, and prohibit ad9 ditional conditions (except where necessary 

10 to implement State or Federal law, or to 

11 protect against fraud and abuse). 

12 ‘‘(B) REDUCTION OF CLERICAL BUR13 DEN.—In adopting standards and operating 

14 rules for the transactions referred to under 

15 paragraph (1), the Secretary shall seek to re16 duce the number and complexity of forms (in17 cluding paper and electronic forms) and data 

18 entry required by patients and providers.’’; and 

19 (C) by adding at the end the following new 

20 subsections: 

21 ‘‘(g) OPERATING RULES.— 

22 ‘‘(1) IN GENERAL.—The Secretary shall adopt 

23 a single set of operating rules for each transaction 

24 referred to under subsection (a)(1) with the goal of 

25 creating as much uniformity in the implementation 


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1 of the electronic standards as possible. Such oper2 ating rules shall be consensus-based and reflect the 

3 necessary business rules affecting health plans and 

4 health care providers and the manner in which they 

5 operate pursuant to standards issued under Health 

6 Insurance Portability and Accountability Act of 

7 1996. 

8 ‘‘(2) OPERATING RULES DEVELOPMENT.—In 

9 adopting operating rules under this subsection, the 

10 Secretary shall consider recommendations for oper11 ating rules developed by a qualified nonprofit entity 

12 that meets the following requirements: 

13 ‘‘(A) The entity focuses its mission on ad14 ministrative simplification. 

15 ‘‘(B) The entity demonstrates a multi16 stakeholder and consensus-based process for de17 velopment of operating rules, including rep18 resentation by or participation from health 

19 plans, health care providers, vendors, relevant 

20 Federal agencies, and other standard develop21 ment organizations. 

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

23 principles that ensure the operating rules and 

24 process are open and transparent, and supports 

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1 cies that demonstrate a commitment to open, 

2 fair, and nondiscriminatory practices. 

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

4 standards issued under Health Insurance Port5 ability and Accountability Act of 1996. 

6 ‘‘(E) The entity allows for public review 

7 and updates of the operating rules. 

8 ‘‘(3) REVIEW AND RECOMMENDATIONS.—The 

9 National Committee on Vital and Health Statistics 

10 shall— 

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

12 nonprofit entity meets the requirements under 

13 paragraph (2); 

14 ‘‘(B) review the operating rules developed 

15 and recommended by such nonprofit entity; 

16 ‘‘(C) determine whether such operating 

17 rules represent a consensus view of the health 

18 care stakeholders and are consistent with and 

19 do not conflict with other existing standards; 

20 ‘‘(D) evaluate whether such operating rules 

21 are consistent with electronic standards adopted 

22 for health information technology; and 

23 ‘‘(E) submit to the Secretary a rec24 ommendation as to whether the Secretary 

25 should adopt such operating rules. 


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1 ‘‘(4) IMPLEMENTATION.— 

2 ‘‘(A) IN GENERAL.—The Secretary shall 

3 adopt operating rules under this subsection, by 

4 regulation in accordance with subparagraph 

5 (C), following consideration of the operating 

6 rules developed by the non-profit entity de7 scribed in paragraph (2) and the recommenda8 tion submitted by the National Committee on 

9 Vital and Health Statistics under paragraph 

10 (3)(E) and having ensured consultation with 

11 providers. 

12 ‘‘(B) ADOPTION REQUIREMENTS; EFFEC13 TIVE DATES.— 

14 ‘‘(i) ELIGIBILITY FOR A HEALTH

15 PLAN AND HEALTH CLAIM STATUS.—The 

16 set of operating rules for eligibility for a 

17 health plan and health claim status trans18 actions shall be adopted not later than 

19 July 1, 2011, in a manner ensuring that 

20 such operating rules are effective not later 

21 than January 1, 2013, and may allow for 

22 the use of a machine readable identifica23 tion card. 

24 ‘‘(ii) ELECTRONIC FUNDS TRANSFERS

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1 TANCE ADVICE.—The set of operating 

2 rules for electronic funds transfers and 

3 health care payment and remittance advice 

4 transactions shall— 

5 ‘‘(I) allow for automated rec6 onciliation of the electronic payment 

7 with the remittance advice; and 

8 ‘‘(II) be adopted not later than 

9 July 1, 2012, in a manner ensuring 

10 that such operating rules are effective 

11 not later than January 1, 2014. 

12 ‘‘(iii) HEALTH CLAIMS OR EQUIVA13 LENT ENCOUNTER INFORMATION, ENROLL14 MENT AND DISENROLLMENT IN A HEALTH

15 PLAN, HEALTH PLAN PREMIUM PAYMENTS, 

16 REFERRAL CERTIFICATION AND AUTHOR17 IZATION.—The set of operating rules for 

18 health claims or equivalent encounter in19 formation, enrollment and disenrollment in 

20 a health plan, health plan premium pay21 ments, and referral certification and au22 thorization transactions shall be adopted 

23 not later than July 1, 2014, in a manner 

24 ensuring that such operating rules are ef25 fective not later than January 1, 2016. 


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1 ‘‘(C) EXPEDITED RULEMAKING.—The Sec2 retary shall promulgate an interim final rule 

3 applying any standard or operating rule rec4 ommended by the National Committee on Vital 

5 and Health Statistics pursuant to paragraph 

6 (3). The Secretary shall accept and consider 

7 public comments on any interim final rule pub8 lished under this subparagraph for 60 days 

9 after the date of such publication. 

10 ‘‘(h) COMPLIANCE.— 

11 ‘‘(1) HEALTH PLAN CERTIFICATION.— 

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

13 HEALTH CLAIM STATUS, ELECTRONIC FUNDS

14 TRANSFERS, HEALTH CARE PAYMENT AND RE15 MITTANCE ADVICE.—Not later than December 

16 31, 2013, a health plan shall file a statement 

17 with the Secretary, in such form as the Sec18 retary may require, certifying that the data and 

19 information systems for such plan are in com20 pliance with any applicable standards (as de21 scribed under paragraph (7) of section 1171) 

22 and associated operating rules (as described 

23 under paragraph (9) of such section) for elec24 tronic funds transfers, eligibility for a health 


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1 plan, health claim status, and health care pay2 ment and remittance advice, respectively. 

3 ‘‘(B) HEALTH CLAIMS OR EQUIVALENT

4 ENCOUNTER INFORMATION, ENROLLMENT AND

5 DISENROLLMENT IN A HEALTH PLAN, HEALTH

6 PLAN PREMIUM PAYMENTS, HEALTH CLAIMS

7 ATTACHMENTS, REFERRAL CERTIFICATION AND

8 AUTHORIZATION.—Not later than December 31, 

9 2015, a health plan shall file a statement with 

10 the Secretary, in such form as the Secretary 

11 may require, certifying that the data and infor12 mation systems for such plan are in compliance 

13 with any applicable standards and associated 

14 operating rules for health claims or equivalent 

15 encounter information, enrollment and 

16 disenrollment in a health plan, health plan pre17 mium payments, health claims attachments, 

18 and referral certification and authorization, re19 spectively. A health plan shall provide the same 

20 level of documentation to certify compliance 

21 with such transactions as is required to certify 

22 compliance with the transactions specified in 

23 subparagraph (A). 

24 ‘‘(2) DOCUMENTATION OF COMPLIANCE.—A 

25 health plan shall provide the Secretary, in such form 


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1 as the Secretary may require, with adequate docu2 mentation of compliance with the standards and op3 erating rules described under paragraph (1). A 

4 health plan shall not be considered to have provided 

5 adequate documentation and shall not be certified as 

6 being in compliance with such standards, unless the 

7 health plan— 

8 ‘‘(A) demonstrates to the Secretary that 

9 the plan conducts the electronic transactions 

10 specified in paragraph (1) in a manner that 

11 fully complies with the regulations of the Sec12 retary; and 

13 ‘‘(B) provides documentation showing that 

14 the plan has completed end-to-end testing for 

15 such transactions with their partners, such as 

16 hospitals and physicians. 

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

18 be required to ensure that any entities that provide 

19 services pursuant to a contract with such health 

20 plan shall comply with any applicable certification 

21 and compliance requirements (and provide the Sec22 retary with adequate documentation of such compli23 ance) under this subsection. 

24 ‘‘(4) CERTIFICATION BY OUTSIDE ENTITY.— 

25 The Secretary may designate independent, outside 


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1 entities to certify that a health plan has complied 

2 with the requirements under this subsection, pro3 vided that the certification standards employed by 

4 such entities are in accordance with any standards 

5 or operating rules issued by the Secretary. 

6 ‘‘(5) COMPLIANCE WITH REVISED STANDARDS

7 AND OPERATING RULES.— 

8 ‘‘(A) IN GENERAL.—A health plan (includ9 ing entities described under paragraph (3)) 

10 shall file a statement with the Secretary, in 

11 such form as the Secretary may require, certi12 fying that the data and information systems for 

13 such plan are in compliance with any applicable 

14 revised standards and associated operating 

15 rules under this subsection for any interim final 

16 rule promulgated by the Secretary under sub17 section (i) that— 

18 ‘‘(i) amends any standard or oper19 ating rule described under paragraph (1) 

20 of this subsection; or 

21 ‘‘(ii) establishes a standard (as de22 scribed under subsection (a)(1)(B)) or as23 sociated operating rules (as described 

24 under subsection (i)(5)) for any other fi25 nancial and administrative transactions. 


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1 ‘‘(B) DATE OF COMPLIANCE.—A health 

2 plan shall comply with such requirements not 

3 later than the effective date of the applicable 

4 standard or operating rule. 

5 ‘‘(6) AUDITS OF HEALTH PLANS.—The Sec6 retary shall conduct periodic audits to ensure that 

7 health plans (including entities described under 

8 paragraph (3)) are in compliance with any standards 

9 and operating rules that are described under para10 graph (1) or subsection (i)(5). 

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

12 OPERATING RULES.— 

13 ‘‘(1) ESTABLISHMENT.—Not later than Janu14 ary 1, 2014, the Secretary shall establish a review 

15 committee (as described under paragraph (4)). 

16 ‘‘(2) EVALUATIONS AND REPORTS.— 

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

18 2014, and not less than biennially thereafter, 

19 the Secretary, acting through the review com20 mittee, shall conduct hearings to evaluate and 

21 review the adopted standards and operating 

22 rules established under this section. 

23 ‘‘(B) REPORT.—Not later than July 1, 

24 2014, and not less than biennially thereafter, 

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1 ommendations for updating and improving such 

2 standards and operating rules. The review com3 mittee shall recommend a single set of oper4 ating rules per transaction standard and main5 tain the goal of creating as much uniformity as 

6 possible in the implementation of the electronic 

7 standards. 

8 ‘‘(3) INTERIM FINAL RULEMAKING.— 

9 ‘‘(A) IN GENERAL.—Any recommendations 

10 to amend adopted standards and operating 

11 rules that have been approved by the review 

12 committee and reported to the Secretary under 

13 paragraph (2)(B) shall be adopted by the Sec14 retary through promulgation of an interim final 

15 rule not later than 90 days after receipt of the 

16 committee’s report. 

17 ‘‘(B) PUBLIC COMMENT.— 

18 ‘‘(i) PUBLIC COMMENT PERIOD.—The 

19 Secretary shall accept and consider public 

20 comments on any interim final rule pub21 lished under this paragraph for 60 days 

22 after the date of such publication. 

23 ‘‘(ii) EFFECTIVE DATE.—The effective 

24 date of any amendment to existing stand25 ards or operating rules that is adopted 


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1 through an interim final rule published 

2 under this paragraph shall be 25 months 

3 following the close of such public comment 

4 period. 

5 ‘‘(4) REVIEW COMMITTEE.— 

6 ‘‘(A) DEFINITION.—For the purposes of 

7 this subsection, the term ‘review committee’ 

8 means a committee chartered by or within the 

9 Department of Health and Human services that 

10 has been designated by the Secretary to carry 

11 out this subsection, including— 

12 ‘‘(i) the National Committee on Vital 

13 and Health Statistics; or 

14 ‘‘(ii) any appropriate committee as de15 termined by the Secretary. 

16 ‘‘(B) COORDINATION OF HIT STAND17 ARDS.—In developing recommendations under 

18 this subsection, the review committee shall en19 sure coordination, as appropriate, with the 

20 standards that support the certified electronic 

21 health record technology approved by the Office 

22 of the National Coordinator for Health Infor23 mation Technology. 

24 ‘‘(5) OPERATING RULES FOR OTHER STAND25 ARDS ADOPTED BY THE SECRETARY.—The Secretary 


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1 shall adopt a single set of operating rules (pursuant 

2 to the process described under subsection (g)) for 

3 any transaction for which a standard had been 

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

5 ‘‘(j) PENALTIES.— 

6 ‘‘(1) PENALTY FEE.— 

7 ‘‘(A) IN GENERAL.—Not later than April 

8 1, 2014, and annually thereafter, the Secretary 

9 shall assess a penalty fee (as determined under 

10 subparagraph (B)) against a health plan that 

11 has failed to meet the requirements under sub12 section (h) with respect to certification and doc13 umentation of compliance with— 

14 ‘‘(i) the standards and associated op15 erating rules described under paragraph 

16 (1) of such subsection; and 

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

18 subsection (a)(1)(B)) and associated oper19 ating rules (as described under subsection 

20 (i)(5)) for any other financial and adminis21 trative transactions. 

22 ‘‘(B) FEE AMOUNT.—Subject to subpara23 graphs (C), (D), and (E), the Secretary shall 

24 assess a penalty fee against a health plan in the 

25 amount of $1 per covered life until certification 


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1 is complete. The penalty shall be assessed per 

2 person covered by the plan for which its data 

3 systems for major medical policies are not in 

4 compliance and shall be imposed against the 

5 health plan for each day that the plan is not in 

6 compliance with the requirements under sub7 section (h). 

8 ‘‘(C) ADDITIONAL PENALTY FOR MIS9 REPRESENTATION.—A health plan that know10 ingly provides inaccurate or incomplete informa11 tion in a statement of certification or docu12 mentation of compliance under subsection (h) 

13 shall be subject to a penalty fee that is double 

14 the amount that would otherwise be imposed 

15 under this subsection. 

16 ‘‘(D) ANNUAL FEE INCREASE.—The 

17 amount of the penalty fee imposed under this 

18 subsection shall be increased on an annual basis 

19 by the annual percentage increase in total na20 tional health care expenditures, as determined 

21 by the Secretary. 

22 ‘‘(E) PENALTY LIMIT.—A penalty fee as23 sessed against a health plan under this sub24 section shall not exceed, on an annual basis— 


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1 ‘‘(i) an amount equal to $20 per cov2 ered life under such plan; or 

3 ‘‘(ii) an amount equal to $40 per cov4 ered life under the plan if such plan has 

5 knowingly provided inaccurate or incom6 plete information (as described under sub7 paragraph (C)). 

8 ‘‘(F) DETERMINATION OF COVERED INDI9 VIDUALS.—The Secretary shall determine the 

10 number of covered lives under a health plan 

11 based upon the most recent statements and fil12 ings that have been submitted by such plan to 

13 the Securities and Exchange Commission. 

14 ‘‘(2) NOTICE AND DISPUTE PROCEDURE.—The 

15 Secretary shall establish a procedure for assessment 

16 of penalty fees under this subsection that provides a 

17 health plan with reasonable notice and a dispute res18 olution procedure prior to provision of a notice of as19 sessment by the Secretary of the Treasury (as de20 scribed under paragraph (4)(B)). 

21 ‘‘(3) PENALTY FEE REPORT.—Not later than 

22 May 1, 2014, and annually thereafter, the Secretary 

23 shall provide the Secretary of the Treasury with a 

24 report identifying those health plans that have been 

25 assessed a penalty fee under this subsection. 


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1 ‘‘(4) COLLECTION OF PENALTY FEE.— 

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

3 Treasury, acting through the Financial Man4 agement Service, shall administer the collection 

5 of penalty fees from health plans that have been 

6 identified by the Secretary in the penalty fee re7 port provided under paragraph (3). 

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

9 2014, and annually thereafter, the Secretary of 

10 the Treasury shall provide notice to each health 

11 plan that has been assessed a penalty fee by the 

12 Secretary under this subsection. Such notice 

13 shall include the amount of the penalty fee as14 sessed by the Secretary and the due date for 

15 payment of such fee to the Secretary of the 

16 Treasury (as described in subparagraph (C)). 

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

18 health plan for a penalty fee assessed under 

19 this subsection shall be made to the Secretary 

20 of the Treasury not later than November 1, 

21 2014, and annually thereafter. 

22 ‘‘(D) UNPAID PENALTY FEES.—Any 

23 amount of a penalty fee assessed against a 

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1 ment has not been made by the due date pro2 vided under subparagraph (C) shall be— 

3 ‘‘(i) increased by the interest accrued 

4 on such amount, as determined pursuant 

5 to the underpayment rate established 

6 under section 6621 of the Internal Rev7 enue Code of 1986; and 

8 ‘‘(ii) treated as a past-due, legally en9 forceable debt owed to a Federal agency 

10 for purposes of section 6402(d) of the In11 ternal Revenue Code of 1986. 

12 ‘‘(E) ADMINISTRATIVE FEES.—Any fee 

13 charged or allocated for collection activities con14 ducted by the Financial Management Service 

15 will be passed on to a health plan on a pro-rata 

16 basis and added to any penalty fee collected 

17 from the plan.’’. 

18 (c) PROMULGATION OF RULES.— 

19 (1) UNIQUE HEALTH PLAN IDENTIFIER.—The 

20 Secretary shall promulgate a final rule to establish 

21 a unique health plan identifier (as described in sec22 tion 1173(b) of the Social Security Act (42 U.S.C. 

23 1320d-2(b))) based on the input of the National 

24 Committee on Vital and Health Statistics. The Sec25 retary may do so on an interim final basis and such 


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1 rule shall be effective not later than October 1, 

2 2012. 

3 (2) ELECTRONIC FUNDS TRANSFER.—The Sec4 retary shall promulgate a final rule to establish a 

5 standard for electronic funds transfers (as described 

6 in section 1173(a)(2)(J) of the Social Security Act, 

7 as added by subsection (b)(2)(A)). The Secretary 

8 may do so on an interim final basis and shall adopt 

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

10 manner ensuring that such standard is effective not 

11 later than January 1, 2014. 

12 (3) HEALTH CLAIMS ATTACHMENTS.—The Sec13 retary shall promulgate a final rule to establish a 

14 transaction standard and a single set of associated 

15 operating rules for health claims attachments (as de16 scribed in section 1173(a)(2)(B) of the Social Secu17 rity Act (42 U.S.C. 1320d-2(a)(2)(B))) that is con18 sistent with the X12 Version 5010 transaction 

19 standards. The Secretary may do so on an interim 

20 final basis and shall adopt a transaction standard 

21 and a single set of associated operating rules not 

22 later than January 1, 2014, in a manner ensuring 

23 that such standard is effective not later than Janu24 ary 1, 2016. 


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1 (d) EXPANSION OF ELECTRONIC TRANSACTIONS IN

2 MEDICARE.—Section 1862(a) of the Social Security Act 

3 (42 U.S.C. 1395y(a)) is amended— 

4 (1) in paragraph (23), by striking the ‘‘or’’ at 

5 the end; 

6 (2) in paragraph (24), by striking the period 

7 and inserting ‘‘; or’’; and 

8 (3) by inserting after paragraph (24) the fol9 lowing new paragraph: 

10 ‘‘(25) not later than January 1, 2014, for 

11 which the payment is other than by electronic funds 

12 transfer (EFT) or an electronic remittance in a form 

13 as specified in ASC X12 835 Health Care Payment 

14 and Remittance Advice or subsequent standard.’’. 

15 SEC. 1105. EFFECTIVE DATE. 

16 This subtitle shall take effect on the date of enact17 ment of this Act. 


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1 Subtitle C—Quality Health Insur2 ance Coverage for All Ameri3 cans 

4 PART I—HEALTH INSURANCE MARKET REFORMS 

5 SEC. 1201. AMENDMENT TO THE PUBLIC HEALTH SERVICE 

6 ACT. 

7 Part A of title XXVII of the Public Health Service 

8 Act (42 U.S.C. 300gg et seq.), as amended by section 

9 1001, is further amended— 

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

11 inserting the following: 

12 ‘‘Subpart I—General Reform’’; 

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

14 striking the section heading and subsection (a) and 

15 inserting the following: 

16 ‘‘SEC. 2704. PROHIBITION OF PREEXISTING CONDITION EX17 CLUSIONS OR OTHER DISCRIMINATION 

18 BASED ON HEALTH STATUS. 

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

20 insurance issuer offering group or individual health insur21 ance coverage may not impose any preexisting condition 

22 exclusion with respect to such plan or coverage.’’; and 

23 (B) by transferring such section (as amended 

24 by subparagraph (A)) so as to appear after the sec25 tion 2703 added by paragraph (4); 


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

2 (i) by striking the section heading and all 

3 that follows through subsection (a); 

4 (ii) in subsection (b)— 

5 (I) by striking ‘‘health insurance 

6 issuer offering health insurance coverage in 

7 connection with a group health plan’’ each 

8 place that such appears and inserting 

9 ‘‘health insurance issuer offering group or 

10 individual health insurance coverage’’; and 

11 (II) in paragraph (2)(A)— 

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

13 after ‘‘employer’’; and 

14 (bb) by inserting ‘‘or individual 

15 health coverage, as the case may be’’ 

16 before the semicolon; and 

17 (iii) in subsection (e)— 

18 (I) by striking ‘‘(a)(1)(F)’’ and insert19 ing ‘‘(a)(6)’’; 

20 (II) by striking ‘‘2701’’ and inserting 

21 ‘‘2704’’; and 

22 (III) by striking ‘‘2721(a)’’ and in23 serting ‘‘2735(a)’’; and 


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1 (B) by transferring such section (as 

2 amended by subparagraph (A)) to appear after 

3 section 2705(a) as added by paragraph (4); and 

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

5 added by paragraph (1)) the following: 

6 ‘‘SEC. 2701. FAIR HEALTH INSURANCE PREMIUMS. 

7 ‘‘(a) PROHIBITING DISCRIMINATORY PREMIUM

8 RATES.— 

9 ‘‘(1) IN GENERAL.—With respect to the pre10 mium rate charged by a health insurance issuer for 

11 health insurance coverage offered in the individual 

12 or small group market— 

13 ‘‘(A) such rate shall vary with respect to 

14 the particular plan or coverage involved only 

15 by— 

16 ‘‘(i) whether such plan or coverage 

17 covers an individual or family; 

18 ‘‘(ii) rating area, as established in ac19 cordance with paragraph (2); 

20 ‘‘(iii) age, except that such rate shall 

21 not vary by more than 3 to 1 for adults 

22 (consistent with section 2707(c)); and 

23 ‘‘(iv) tobacco use, except that such 

24 rate shall not vary by more than 1.5 to 1; 

25 and 


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1 ‘‘(B) such rate shall not vary with respect 

2 to the particular plan or coverage involved by 

3 any other factor not described in subparagraph 

4 (A). 

5 ‘‘(2) RATING AREA.— 

6 ‘‘(A) IN GENERAL.—Each State shall es7 tablish 1 or more rating areas within that State 

8 for purposes of applying the requirements of 

9 this title. 

10 ‘‘(B) SECRETARIAL REVIEW.—The Sec11 retary shall review the rating areas established 

12 by each State under subparagraph (A) to en13 sure the adequacy of such areas for purposes of 

14 carrying out the requirements of this title. If 

15 the Secretary determines a State’s rating areas 

16 are not adequate, or that a State does not es17 tablish such areas, the Secretary may establish 

18 rating areas for that State. 

19 ‘‘(3) PERMISSIBLE AGE BANDS.—The Sec20 retary, in consultation with the National Association 

21 of Insurance Commissioners, shall define the permis22 sible age bands for rating purposes under paragraph 

23 (1)(A)(iii). 

24 ‘‘(4) APPLICATION OF VARIATIONS BASED ON

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1 erage under a group health plan or health insurance 

2 coverage, the rating variations permitted under 

3 clauses (iii) and (iv) of paragraph (1)(A) shall be 

4 applied based on the portion of the premium that is 

5 attributable to each family member covered under 

6 the plan or coverage. 

7 ‘‘(5) SPECIAL RULE FOR LARGE GROUP MAR8 KET.—If a State permits health insurance issuers 

9 that offer coverage in the large group market in the 

10 State to offer such coverage through the State Ex11 change (as provided for under section 1312(f)(2)(B) 

12 of the Patient Protection and Affordable Care Act), 

13 the provisions of this subsection shall apply to all 

14 coverage offered in such market in the State. 

15 ‘‘SEC. 2702. GUARANTEED AVAILABILITY OF COVERAGE. 

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

17 INDIVIDUAL AND GROUP MARKET.—Subject to sub18 sections (b) through (e), each health insurance issuer that 

19 offers health insurance coverage in the individual or group 

20 market in a State must accept every employer and indi21 vidual in the State that applies for such coverage. 

22 ‘‘(b) ENROLLMENT.— 

23 ‘‘(1) RESTRICTION.—A health insurance issuer 

24 described in subsection (a) may restrict enrollment 


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1 in coverage described in such subsection to open or 

2 special enrollment periods. 

3 ‘‘(2) ESTABLISHMENT.—A health insurance 

4 issuer described in subsection (a) shall, in accord5 ance with the regulations promulgated under para6 graph (3), establish special enrollment periods for 

7 qualifying events (under section 603 of the Em8 ployee Retirement Income Security Act of 1974). 

9 ‘‘(3) REGULATIONS.—The Secretary shall pro10 mulgate regulations with respect to enrollment peri11 ods under paragraphs (1) and (2). 

12 ‘‘SEC. 2703. GUARANTEED RENEWABILITY OF COVERAGE. 

13 ‘‘(a) IN GENERAL.—Except as provided in this sec14 tion, if a health insurance issuer offers health insurance 

15 coverage in the individual or group market, the issuer 

16 must renew or continue in force such coverage at the op17 tion of the plan sponsor or the individual, as applicable. 

18 ‘‘SEC. 2705. PROHIBITING DISCRIMINATION AGAINST INDI19 VIDUAL PARTICIPANTS AND BENEFICIARIES 

20 BASED ON HEALTH STATUS. 

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

22 insurance issuer offering group or individual health insur23 ance coverage may not establish rules for eligibility (in24 cluding continued eligibility) of any individual to enroll 

25 under the terms of the plan or coverage based on any of 


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1 the following health status-related factors in relation to 

2 the individual or a dependent of the individual: 

3 ‘‘(1) Health status. 

4 ‘‘(2) Medical condition (including both physical 

5 and mental illnesses). 

6 ‘‘(3) Claims experience. 

7 ‘‘(4) Receipt of health care. 

8 ‘‘(5) Medical history. 

9 ‘‘(6) Genetic information. 

10 ‘‘(7) Evidence of insurability (including condi11 tions arising out of acts of domestic violence). 

12 ‘‘(8) Disability. 

13 ‘‘(9) Any other health status-related factor de14 termined appropriate by the Secretary. 

15 ‘‘(j) PROGRAMS OF HEALTH PROMOTION OR DIS16 EASE PREVENTION.— 

17 ‘‘(1) GENERAL PROVISIONS.— 

18 ‘‘(A) GENERAL RULE.—For purposes of 

19 subsection (b)(2)(B), a program of health pro20 motion or disease prevention (referred to in this 

21 subsection as a ‘wellness program’) shall be a 

22 program offered by an employer that is de23 signed to promote health or prevent disease 

24 that meets the applicable requirements of this 

25 subsection. 


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1 ‘‘(B) NO CONDITIONS BASED ON HEALTH

2 STATUS FACTOR.—If none of the conditions for 

3 obtaining a premium discount or rebate or 

4 other reward for participation in a wellness pro5 gram is based on an individual satisfying a 

6 standard that is related to a health status fac7 tor, such wellness program shall not violate this 

8 section if participation in the program is made 

9 available to all similarly situated individuals 

10 and the requirements of paragraph (2) are com11 plied with. 

12 ‘‘(C) CONDITIONS BASED ON HEALTH STA13 TUS FACTOR.—If any of the conditions for ob14 taining a premium discount or rebate or other 

15 reward for participation in a wellness program 

16 is based on an individual satisfying a standard 

17 that is related to a health status factor, such 

18 wellness program shall not violate this section if 

19 the requirements of paragraph (3) are complied 

20 with. 

21 ‘‘(2) WELLNESS PROGRAMS NOT SUBJECT TO

22 REQUIREMENTS.—If none of the conditions for ob23 taining a premium discount or rebate or other re24 ward under a wellness program as described in para25 graph (1)(B) are based on an individual satisfying 


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1 a standard that is related to a health status factor 

2 (or if such a wellness program does not provide such 

3 a reward), the wellness program shall not violate 

4 this section if participation in the program is made 

5 available to all similarly situated individuals. The 

6 following programs shall not have to comply with the 

7 requirements of paragraph (3) if participation in the 

8 program is made available to all similarly situated 

9 individuals: 

10 ‘‘(A) A program that reimburses all or 

11 part of the cost for memberships in a fitness 

12 center. 

13 ‘‘(B) A diagnostic testing program that 

14 provides a reward for participation and does 

15 not base any part of the reward on outcomes. 

16 ‘‘(C) A program that encourages preven17 tive care related to a health condition through 

18 the waiver of the copayment or deductible re19 quirement under group health plan for the costs 

20 of certain items or services related to a health 

21 condition (such as prenatal care or well-baby 

22 visits). 

23 ‘‘(D) A program that reimburses individ24 uals for the costs of smoking cessation proVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00086 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 grams without regard to whether the individual 

2 quits smoking. 

3 ‘‘(E) A program that provides a reward to 

4 individuals for attending a periodic health edu5 cation seminar. 

6 ‘‘(3) WELLNESS PROGRAMS SUBJECT TO RE7 QUIREMENTS.—If any of the conditions for obtaining 

8 a premium discount, rebate, or reward under a 

9 wellness program as described in paragraph (1)(C) 

10 is based on an individual satisfying a standard that 

11 is related to a health status factor, the wellness pro12 gram shall not violate this section if the following re13 quirements are complied with: 

14 ‘‘(A) The reward for the wellness program, 

15 together with the reward for other wellness pro16 grams with respect to the plan that requires 

17 satisfaction of a standard related to a health 

18 status factor, shall not exceed 30 percent of the 

19 cost of employee-only coverage under the plan. 

20 If, in addition to employees or individuals, any 

21 class of dependents (such as spouses or spouses 

22 and dependent children) may participate fully 

23 in the wellness program, such reward shall not 

24 exceed 30 percent of the cost of the coverage in 

25 which an employee or individual and any deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00087 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pendents are enrolled. For purposes of this 

2 paragraph, the cost of coverage shall be deter3 mined based on the total amount of employer 

4 and employee contributions for the benefit 

5 package under which the employee is (or the 

6 employee and any dependents are) receiving 

7 coverage. A reward may be in the form of a dis8 count or rebate of a premium or contribution, 

9 a waiver of all or part of a cost-sharing mecha10 nism (such as deductibles, copayments, or coin11 surance), the absence of a surcharge, or the 

12 value of a benefit that would otherwise not be 

13 provided under the plan. The Secretaries of 

14 Labor, Health and Human Services, and the 

15 Treasury may increase the reward available 

16 under this subparagraph to up to 50 percent of 

17 the cost of coverage if the Secretaries determine 

18 that such an increase is appropriate. 

19 ‘‘(B) The wellness program shall be rea20 sonably designed to promote health or prevent 

21 disease. A program complies with the preceding 

22 sentence if the program has a reasonable 

23 chance of improving the health of, or preventing 

24 disease in, participating individuals and it is 

25 not overly burdensome, is not a subterfuge for 


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1 discriminating based on a health status factor, 

2 and is not highly suspect in the method chosen 

3 to promote health or prevent disease. 

4 ‘‘(C) The plan shall give individuals eligible 

5 for the program the opportunity to qualify for 

6 the reward under the program at least once 

7 each year. 

8 ‘‘(D) The full reward under the wellness 

9 program shall be made available to all similarly 

10 situated individuals. For such purpose, among 

11 other things: 

12 ‘‘(i) The reward is not available to all 

13 similarly situated individuals for a period 

14 unless the wellness program allows— 

15 ‘‘(I) for a reasonable alternative 

16 standard (or waiver of the otherwise 

17 applicable standard) for obtaining the 

18 reward for any individual for whom, 

19 for that period, it is unreasonably dif20 ficult due to a medical condition to 

21 satisfy the otherwise applicable stand22 ard; and 

23 ‘‘(II) for a reasonable alternative 

24 standard (or waiver of the otherwise 

25 applicable standard) for obtaining the 


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1 reward for any individual for whom, 

2 for that period, it is medically inadvis3 able to attempt to satisfy the other4 wise applicable standard. 

5 ‘‘(ii) If reasonable under the cir6 cumstances, the plan or issuer may seek 

7 verification, such as a statement from an 

8 individual’s physician, that a health status 

9 factor makes it unreasonably difficult or 

10 medically inadvisable for the individual to 

11 satisfy or attempt to satisfy the otherwise 

12 applicable standard. 

13 ‘‘(E) The plan or issuer involved shall dis14 close in all plan materials describing the terms 

15 of the wellness program the availability of a 

16 reasonable alternative standard (or the possi17 bility of waiver of the otherwise applicable 

18 standard) required under subparagraph (D). If 

19 plan materials disclose that such a program is 

20 available, without describing its terms, the dis21 closure under this subparagraph shall not be re22 quired. 

23 ‘‘(k) EXISTING PROGRAMS.—Nothing in this section 

24 shall prohibit a program of health promotion or disease 

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1 ment of this section and applied with all applicable regula2 tions, and that is operating on such date, from continuing 

3 to be carried out for as long as such regulations remain 

4 in effect. 

5 ‘‘(l) WELLNESS PROGRAM DEMONSTRATION

6 PROJECT.— 

7 ‘‘(1) IN GENERAL.—Not later than July 1, 

8 2014, the Secretary, in consultation with the Sec9 retary of the Treasury and the Secretary of Labor, 

10 shall establish a 10-State demonstration project 

11 under which participating States shall apply the pro12 visions of subsection (j) to programs of health pro13 motion offered by a health insurance issuer that of14 fers health insurance coverage in the individual mar15 ket in such State. 

16 ‘‘(2) EXPANSION OF DEMONSTRATION

17 PROJECT.—If the Secretary, in consultation with the 

18 Secretary of the Treasury and the Secretary of 

19 Labor, determines that the demonstration project 

20 described in paragraph (1) is effective, such Secre21 taries may, beginning on July 1, 2017 expand such 

22 demonstration project to include additional partici23 pating States. 

24 ‘‘(3) REQUIREMENTS.— 


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1 ‘‘(A) MAINTENANCE OF COVERAGE.—The 

2 Secretary, in consultation with the Secretary of 

3 the Treasury and the Secretary of Labor, shall 

4 not approve the participation of a State in the 

5 demonstration project under this section unless 

6 the Secretaries determine that the State’s 

7 project is designed in a manner that— 

8 ‘‘(i) will not result in any decrease in 

9 coverage; and 

10 ‘‘(ii) will not increase the cost to the 

11 Federal Government in providing credits 

12 under section 36B of the Internal Revenue 

13 Code of 1986 or cost-sharing assistance 

14 under section 1402 of the Patient Protec15 tion and Affordable Care Act. 

16 ‘‘(B) OTHER REQUIREMENTS.—States that 

17 participate in the demonstration project under 

18 this subsection— 

19 ‘‘(i) may permit premium discounts or 

20 rebates or the modification of otherwise 

21 applicable copayments or deductibles for 

22 adherence to, or participation in, a reason23 ably designed program of health promotion 

24 and disease prevention; 


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1 ‘‘(ii) shall ensure that requirements of 

2 consumer protection are met in programs 

3 of health promotion in the individual mar4 ket; 

5 ‘‘(iii) shall require verification from 

6 health insurance issuers that offer health 

7 insurance coverage in the individual mar8 ket of such State that premium dis9 counts— 

10 ‘‘(I) do not create undue burdens 

11 for individuals insured in the indi12 vidual market; 

13 ‘‘(II) do not lead to cost shifting; 

14 and 

15 ‘‘(III) are not a subterfuge for 

16 discrimination; 

17 ‘‘(iv) shall ensure that consumer data 

18 is protected in accordance with the require19 ments of section 264(c) of the Health In20 surance Portability and Accountability Act 

21 of 1996 (42 U.S.C. 1320d-2 note); and 

22 ‘‘(v) shall ensure and demonstrate to 

23 the satisfaction of the Secretary that the 

24 discounts or other rewards provided under 

25 the project reflect the expected level of parVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00093 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ticipation in the wellness program involved 

2 and the anticipated effect the program will 

3 have on utilization or medical claim costs. 

4 ‘‘(m) REPORT.— 

5 ‘‘(1) IN GENERAL.—Not later than 3 years 

6 after the date of enactment of the Patient Protection 

7 and Affordable Care Act, the Secretary, in consulta8 tion with the Secretary of the Treasury and the Sec9 retary of Labor, shall submit a report to the appro10 priate committees of Congress concerning— 

11 ‘‘(A) the effectiveness of wellness programs 

12 (as defined in subsection (j)) in promoting 

13 health and preventing disease; 

14 ‘‘(B) the impact of such wellness programs 

15 on the access to care and affordability of cov16 erage for participants and non-participants of 

17 such programs; 

18 ‘‘(C) the impact of premium-based and 

19 cost-sharing incentives on participant behavior 

20 and the role of such programs in changing be21 havior; and 

22 ‘‘(D) the effectiveness of different types of 

23 rewards. 

24 ‘‘(2) DATA COLLECTION.—In preparing the re25 port described in paragraph (1), the Secretaries 


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1 shall gather relevant information from employers 

2 who provide employees with access to wellness pro3 grams, including State and Federal agencies. 

4 ‘‘(n) REGULATIONS.—Nothing in this section shall be 

5 construed as prohibiting the Secretaries of Labor, Health 

6 and Human Services, or the Treasury from promulgating 

7 regulations in connection with this section. 

8 ‘‘SEC. 2706. NON-DISCRIMINATION IN HEALTH CARE. 

9 ‘‘(a) PROVIDERS.—A group health plan and a health 

10 insurance issuer offering group or individual health insur11 ance coverage shall not discriminate with respect to par12 ticipation under the plan or coverage against any health 

13 care provider who is acting within the scope of that pro14 vider’s license or certification under applicable State law. 

15 This section shall not require that a group health plan 

16 or health insurance issuer contract with any health care 

17 provider willing to abide by the terms and conditions for 

18 participation established by the plan or issuer. Nothing 

19 in this section shall be construed as preventing a group 

20 health plan, a health insurance issuer, or the Secretary 

21 from establishing varying reimbursement rates based on 

22 quality or performance measures. 

23 ‘‘(b) INDIVIDUALS.—The provisions of section 1558 

24 of the Patient Protection and Affordable Care Act (relat25 ing to non-discrimination) shall apply with respect to a 


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1 group health plan or health insurance issuer offering 

2 group or individual health insurance coverage. 

3 ‘‘SEC. 2707. COMPREHENSIVE HEALTH INSURANCE COV4 ERAGE. 

5 ‘‘(a) COVERAGE FOR ESSENTIAL HEALTH BENEFITS

6 PACKAGE.—A health insurance issuer that offers health 

7 insurance coverage in the individual or small group market 

8 shall ensure that such coverage includes the essential 

9 health benefits package required under section 1302(a) of 

10 the Patient Protection and Affordable Care Act. 

11 ‘‘(b) COST-SHARING UNDER GROUP HEALTH

12 PLANS.—A group health plan shall ensure that any an13 nual cost-sharing imposed under the plan does not exceed 

14 the limitations provided for under paragraphs (1) and (2) 

15 of section 1302(c). 

16 ‘‘(c) CHILD-ONLY PLANS.—If a health insurance 

17 issuer offers health insurance coverage in any level of cov18 erage specified under section 1302(d) of the Patient Pro19 tection and Affordable Care Act, the issuer shall also offer 

20 such coverage in that level as a plan in which the only 

21 enrollees are individuals who, as of the beginning of a plan 

22 year, have not attained the age of 21. 

23 ‘‘(d) DENTAL ONLY.—This section shall not apply to 

24 a plan described in section 1302(d)(2)(B)(ii)(I). 


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1 ‘‘SEC. 2708. PROHIBITION ON EXCESSIVE WAITING PERI2 ODS. 

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

4 offering group or individual health insurance coverage 

5 shall not apply any waiting period (as defined in section 

6 2704(b)(4)) that exceeds 90 days.’’. 

7 PART II—OTHER PROVISIONS 

8 SEC. 1251. PRESERVATION OF RIGHT TO MAINTAIN EXIST9 ING COVERAGE. 

10 (a) NO CHANGES TO EXISTING COVERAGE.— 

11 (1) IN GENERAL.—Nothing in this Act (or an 

12 amendment made by this Act) shall be construed to 

13 require that an individual terminate coverage under 

14 a group health plan or health insurance coverage in 

15 which such individual was enrolled on the date of en16 actment of this Act. 

17 (2) CONTINUATION OF COVERAGE.—With re18 spect to a group health plan or health insurance cov19 erage in which an individual was enrolled on the 

20 date of enactment of this Act, this subtitle and sub21 title A (and the amendments made by such subtitles) 

22 shall not apply to such plan or coverage, regardless 

23 of whether the individual renews such coverage after 

24 such date of enactment. 

25 (b) ALLOWANCE FOR FAMILY MEMBERS TO JOIN

26 CURRENT COVERAGE.—With respect to a group health 


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1 plan or health insurance coverage in which an individual 

2 was enrolled on the date of enactment of this Act and 

3 which is renewed after such date, family members of such 

4 individual shall be permitted to enroll in such plan or cov5 erage if such enrollment is permitted under the terms of 

6 the plan in effect as of such date of enactment. 

7 (c) ALLOWANCE FOR NEW EMPLOYEES TO JOIN

8 CURRENT PLAN.—A group health plan that provides cov9 erage on the date of enactment of this Act may provide 

10 for the enrolling of new employees (and their families) in 

11 such plan, and this subtitle and subtitle A (and the 

12 amendments made by such subtitles) shall not apply with 

13 respect to such plan and such new employees (and their 

14 families). 

15 (d) EFFECT ON COLLECTIVE BARGAINING AGREE16 MENTS.—In the case of health insurance coverage main17 tained pursuant to one or more collective bargaining 

18 agreements between employee representatives and one or 

19 more employers that was ratified before the date of enact20 ment of this Act, the provisions of this subtitle and sub21 title A (and the amendments made by such subtitles) shall 

22 not apply until the date on which the last of the collective 

23 bargaining agreements relating to the coverage termi24 nates. Any coverage amendment made pursuant to a col25 lective bargaining agreement relating to the coverage 


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1 which amends the coverage solely to conform to any re2 quirement added by this subtitle or subtitle A (or amend3 ments) shall not be treated as a termination of such collec4 tive bargaining agreement. 

5 (e) DEFINITION.—In this title, the term ‘‘grand6 fathered health plan’’ means any group health plan or 

7 health insurance coverage to which this section applies. 

8 SEC. 1252. RATING REFORMS MUST APPLY UNIFORMLY TO 

9 ALL HEALTH INSURANCE ISSUERS AND 

10 GROUP HEALTH PLANS. 

11 Any standard or requirement adopted by a State pur12 suant to this title, or any amendment made by this title, 

13 shall be applied uniformly to all health plans in each insur14 ance market to which the standard and requirements 

15 apply. The preceding sentence shall also apply to a State 

16 standard or requirement relating to the standard or re17 quirement required by this title (or any such amendment) 

18 that is not the same as the standard or requirement but 

19 that is not preempted under section 1321(d). 

20 SEC. 1253. EFFECTIVE DATES. 

21 This subtitle (and the amendments made by this sub22 title) shall become effective for plan years beginning on 

23 or after January 1, 2014. 


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1 Subtitle D—Available Coverage 

2 Choices for All Americans 

3 PART I—ESTABLISHMENT OF QUALIFIED 

4 HEALTH PLANS 

5 SEC. 1301. QUALIFIED HEALTH PLAN DEFINED. 

6 (a) QUALIFIED HEALTH PLAN.—In this title: 

7 (1) IN GENERAL.—The term ‘‘qualified health 

8 plan’’ means a health plan that— 

9 (A) has in effect a certification (which may 

10 include a seal or other indication of approval) 

11 that such plan meets the criteria for certifi12 cation described in section 1311(c) issued or 

13 recognized by each Exchange through which 

14 such plan is offered; 

15 (B) provides the essential health benefits 

16 package described in section 1302(a); and 

17 (C) is offered by a health insurance issuer 

18 that— 

19 (i) is licensed and in good standing to 

20 offer health insurance coverage in each 

21 State in which such issuer offers health in22 surance coverage under this title; 

23 (ii) agrees to offer at least one quali24 fied health plan in the silver level and at 


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1 least one plan in the gold level in each 

2 such Exchange; 

3 (iii) agrees to charge the same pre4 mium rate for each qualified health plan of 

5 the issuer without regard to whether the 

6 plan is offered through an Exchange or 

7 whether the plan is offered directly from 

8 the issuer or through an agent; and 

9 (iv) complies with the regulations de10 veloped by the Secretary under section 

11 1311(d) and such other requirements as 

12 an applicable Exchange may establish. 

13 (2) INCLUSION OF CO-OP PLANS AND COMMU14 NITY HEALTH INSURANCE OPTION.—Any reference 

15 in this title to a qualified health plan shall be 

16 deemed to include a qualified health plan offered 

17 through the CO-OP program under section 1322 or 

18 a community health insurance option under section 

19 1323, unless specifically provided for otherwise. 

20 (b) TERMS RELATING TO HEALTH PLANS.—In this 

21 title: 

22 (1) HEALTH PLAN.— 

23 (A) IN GENERAL.—The term ‘‘health plan’’ 

24 means health insurance coverage and a group 

25 health plan. 


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1 (B) EXCEPTION FOR SELF-INSURED PLANS

2 AND MEWAS.—Except to the extent specifically 

3 provided by this title, the term ‘‘health plan’’ 

4 shall not include a group health plan or mul5 tiple employer welfare arrangement to the ex6 tent the plan or arrangement is not subject to 

7 State insurance regulation under section 514 of 

8 the Employee Retirement Income Security Act 

9 of 1974. 

10 (2) HEALTH INSURANCE COVERAGE AND

11 ISSUER.—The terms ‘‘health insurance coverage’’ 

12 and ‘‘health insurance issuer’’ have the meanings 

13 given such terms by section 2791(b) of the Public 

14 Health Service Act. 

15 (3) GROUP HEALTH PLAN.—The term ‘‘group 

16 health plan’’ has the meaning given such term by 

17 section 2791(a) of the Public Health Service Act. 

18 SEC. 1302. ESSENTIAL HEALTH BENEFITS REQUIREMENTS. 

19 (a) ESSENTIAL HEALTH BENEFITS PACKAGE.—In 

20 this title, the term ‘‘essential health benefits package’’ 

21 means, with respect to any health plan, coverage that— 

22 (1) provides for the essential health benefits de23 fined by the Secretary under subsection (b); 

24 (2) limits cost-sharing for such coverage in ac25 cordance with subsection (c); and 


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1 (3) subject to subsection (e), provides either the 

2 bronze, silver, gold, or platinum level of coverage de3 scribed in subsection (d). 

4 (b) ESSENTIAL HEALTH BENEFITS.— 

5 (1) IN GENERAL.—Subject to paragraph (2), 

6 the Secretary shall define the essential health bene7 fits, except that such benefits shall include at least 

8 the following general categories and the items and 

9 services covered within the categories: 

10 (A) Ambulatory patient services. 

11 (B) Emergency services. 

12 (C) Hospitalization. 

13 (D) Maternity and newborn care. 

14 (E) Mental health and substance use dis15 order services, including behavioral health treat16 ment. 

17 (F) Prescription drugs. 

18 (G) Rehabilitative and habilitative services 

19 and devices. 

20 (H) Laboratory services. 

21 (I) Preventive and wellness services and 

22 chronic disease management. 

23 (J) Pediatric services, including oral and 

24 vision care. 

25 (2) LIMITATION.— 


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1 (A) IN GENERAL.—The Secretary shall en2 sure that the scope of the essential health bene3 fits under paragraph (1) is equal to the scope 

4 of benefits provided under a typical employer 

5 plan, as determined by the Secretary. To in6 form this determination, the Secretary of Labor 

7 shall conduct a survey of employer-sponsored 

8 coverage to determine the benefits typically cov9 ered by employers, including multiemployer 

10 plans, and provide a report on such survey to 

11 the Secretary. 

12 (B) CERTIFICATION.—In defining the es13 sential health benefits described in paragraph 

14 (1), and in revising the benefits under para15 graph (4)(H), the Secretary shall submit a re16 port to the appropriate committees of Congress 

17 containing a certification from the Chief Actu18 ary of the Centers for Medicare & Medicaid 

19 Services that such essential health benefits meet 

20 the limitation described in paragraph (2). 

21 (3) NOTICE AND HEARING.—In defining the es22 sential health benefits described in paragraph (1), 

23 and in revising the benefits under paragraph (4)(H), 

24 the Secretary shall provide notice and an oppor25 tunity for public comment. 


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1 (4) REQUIRED ELEMENTS FOR CONSIDER2 ATION.—In defining the essential health benefits 

3 under paragraph (1), the Secretary shall— 

4 (A) ensure that such essential health bene5 fits reflect an appropriate balance among the 

6 categories described in such subsection, so that 

7 benefits are not unduly weighted toward any 

8 category; 

9 (B) not make coverage decisions, deter10 mine reimbursement rates, establish incentive 

11 programs, or design benefits in ways that dis12 criminate against individuals because of their 

13 age, disability, or expected length of life; 

14 (C) take into account the health care needs 

15 of diverse segments of the population, including 

16 women, children, persons with disabilities, and 

17 other groups; 

18 (D) ensure that health benefits established 

19 as essential not be subject to denial to individ20 uals against their wishes on the basis of the in21 dividuals’ age or expected length of life or of 

22 the individuals’ present or predicted disability, 

23 degree of medical dependency, or quality of life; 

24 (E) provide that a qualified health plan 

25 shall not be treated as providing coverage for 


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1 the essential health benefits described in para2 graph (1) unless the plan provides that— 

3 (i) coverage for emergency department 

4 services will be provided without imposing 

5 any requirement under the plan for prior 

6 authorization of services or any limitation 

7 on coverage where the provider of services 

8 does not have a contractual relationship 

9 with the plan for the providing of services 

10 that is more restrictive than the require11 ments or limitations that apply to emer12 gency department services received from 

13 providers who do have such a contractual 

14 relationship with the plan; and 

15 (ii) if such services are provided out16 of-network, the cost-sharing requirement 

17 (expressed as a copayment amount or coin18 surance rate) is the same requirement that 

19 would apply if such services were provided 

20 in-network; 

21 (F) provide that if a plan described in sec22 tion 1311(b)(2)(B)(ii) (relating to stand-alone 

23 dental benefits plans) is offered through an Ex24 change, another health plan offered through 

25 such Exchange shall not fail to be treated as a 


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1 qualified health plan solely because the plan 

2 does not offer coverage of benefits offered 

3 through the stand-alone plan that are otherwise 

4 required under paragraph (1)(J); and 

5 (G) periodically review the essential health 

6 benefits under paragraph (1), and provide a re7 port to Congress and the public that contains— 

8 (i) an assessment of whether enrollees 

9 are facing any difficulty accessing needed 

10 services for reasons of coverage or cost; 

11 (ii) an assessment of whether the es12 sential health benefits needs to be modified 

13 or updated to account for changes in med14 ical evidence or scientific advancement; 

15 (iii) information on how the essential 

16 health benefits will be modified to address 

17 any such gaps in access or changes in the 

18 evidence base; 

19 (iv) an assessment of the potential of 

20 additional or expanded benefits to increase 

21 costs and the interactions between the ad22 dition or expansion of benefits and reduc23 tions in existing benefits to meet actuarial 

24 limitations described in paragraph (2); and 


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1 (H) periodically update the essential health 

2 benefits under paragraph (1) to address any 

3 gaps in access to coverage or changes in the 

4 evidence base the Secretary identifies in the re5 view conducted under subparagraph (G). 

6 (5) RULE OF CONSTRUCTION.—Nothing in this 

7 title shall be construed to prohibit a health plan 

8 from providing benefits in excess of the essential 

9 health benefits described in this subsection. 

10 (c) REQUIREMENTS RELATING TO COST-SHARING.— 

11 (1) ANNUAL LIMITATION ON COST-SHARING.— 

12 (A) 2014.—The cost-sharing incurred 

13 under a health plan with respect to self-only 

14 coverage or coverage other than self-only cov15 erage for a plan year beginning in 2014 shall 

16 not exceed the dollar amounts in effect under 

17 section 223(c)(2)(A)(ii) of the Internal Revenue 

18 Code of 1986 for self-only and family coverage, 

19 respectively, for taxable years beginning in 

20 2014. 

21 (B) 2015 AND LATER.—In the case of any 

22 plan year beginning in a calendar year after 

23 2014, the limitation under this paragraph 

24 shall— 


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1 (i) in the case of self-only coverage, be 

2 equal to the dollar amount under subpara3 graph (A) for self-only coverage for plan 

4 years beginning in 2014, increased by an 

5 amount equal to the product of that 

6 amount and the premium adjustment per7 centage under paragraph (4) for the cal8 endar year; and 

9 (ii) in the case of other coverage, 

10 twice the amount in effect under clause (i). 

11 If the amount of any increase under clause (i) 

12 is not a multiple of $50, such increase shall be 

13 rounded to the next lowest multiple of $50. 

14 (2) ANNUAL LIMITATION ON DEDUCTIBLES FOR

15 EMPLOYER-SPONSORED PLANS.— 

16 (A) IN GENERAL.—In the case of a health 

17 plan offered in the small group market, the de18 ductible under the plan shall not exceed— 

19 (i) $2,000 in the case of a plan cov20 ering a single individual; and 

21 (ii) $4,000 in the case of any other 

22 plan. 

23 The amounts under clauses (i) and (ii) may be 

24 increased by the maximum amount of reim25 bursement which is reasonably available to a 


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1 participant under a flexible spending arrange2 ment described in section 106(c)(2) of the In3 ternal Revenue Code of 1986 (determined with4 out regard to any salary reduction arrange5 ment). 

6 (B) INDEXING OF LIMITS.—In the case of 

7 any plan year beginning in a calendar year 

8 after 2014— 

9 (i) the dollar amount under subpara10 graph (A)(i) shall be increased by an 

11 amount equal to the product of that 

12 amount and the premium adjustment per13 centage under paragraph (4) for the cal14 endar year; and 

15 (ii) the dollar amount under subpara16 graph (A)(ii) shall be increased to an 

17 amount equal to twice the amount in effect 

18 under subparagraph (A)(i) for plan years 

19 beginning in the calendar year, determined 

20 after application of clause (i). 

21 If the amount of any increase under clause (i) 

22 is not a multiple of $50, such increase shall be 

23 rounded to the next lowest multiple of $50. 

24 (C) ACTUARIAL VALUE.—The limitation 

25 under this paragraph shall be applied in such a 


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1 manner so as to not affect the actuarial value 

2 of any health plan, including a plan in the 

3 bronze level. 

4 (D) COORDINATION WITH PREVENTIVE

5 LIMITS.—Nothing in this paragraph shall be 

6 construed to allow a plan to have a deductible 

7 under the plan apply to benefits described in 

8 section 2713 of the Public Health Service Act. 

9 (3) COST-SHARING.—In this title— 

10 (A) IN GENERAL.—The term ‘‘cost-shar11 ing’’ includes— 

12 (i) deductibles, coinsurance, copay13 ments, or similar charges; and 

14 (ii) any other expenditure required of 

15 an insured individual which is a qualified 

16 medical expense (within the meaning of 

17 section 223(d)(2) of the Internal Revenue 

18 Code of 1986) with respect to essential 

19 health benefits covered under the plan. 

20 (B) EXCEPTIONS.—Such term does not in21 clude premiums, balance billing amounts for 

22 non-network providers, or spending for non-cov23 ered services. 

24 (4) PREMIUM ADJUSTMENT PERCENTAGE.—For 

25 purposes of paragraphs (1)(B)(i) and (2)(B)(i), the 


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1 premium adjustment percentage for any calendar 

2 year is the percentage (if any) by which the average 

3 per capita premium for health insurance coverage in 

4 the United States for the preceding calendar year 

5 (as estimated by the Secretary no later than October 

6 1 of such preceding calendar year) exceeds such av7 erage per capita premium for 2013 (as determined 

8 by the Secretary). 

9 (d) LEVELS OF COVERAGE.— 

10 (1) LEVELS OF COVERAGE DEFINED.—The lev11 els of coverage described in this subsection are as 

12 follows: 

13 (A) BRONZE LEVEL.—A plan in the bronze 

14 level shall provide a level of coverage that is de15 signed to provide benefits that are actuarially 

16 equivalent to 60 percent of the full actuarial 

17 value of the benefits provided under the plan. 

18 (B) SILVER LEVEL.—A plan in the silver 

19 level shall provide a level of coverage that is de20 signed to provide benefits that are actuarially 

21 equivalent to 70 percent of the full actuarial 

22 value of the benefits provided under the plan. 

23 (C) GOLD LEVEL.—A plan in the gold level 

24 shall provide a level of coverage that is designed 

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1 lent to 80 percent of the full actuarial value of 

2 the benefits provided under the plan. 

3 (D) PLATINUM LEVEL.—A plan in the 

4 platinum level shall provide a level of coverage 

5 that is designed to provide benefits that are ac6 tuarially equivalent to 90 percent of the full ac7 tuarial value of the benefits provided under the 

8 plan. 

9 (2) ACTUARIAL VALUE.— 

10 (A) IN GENERAL.—Under regulations 

11 issued by the Secretary, the level of coverage of 

12 a plan shall be determined on the basis that the 

13 essential health benefits described in subsection 

14 (b) shall be provided to a standard population 

15 (and without regard to the population the plan 

16 may actually provide benefits to). 

17 (B) EMPLOYER CONTRIBUTIONS.—The 

18 Secretary may issue regulations under which 

19 employer contributions to a health savings ac20 count (within the meaning of section 223 of the 

21 Internal Revenue Code of 1986) may be taken 

22 into account in determining the level of cov23 erage for a plan of the employer. 

24 (C) APPLICATION.—In determining under 

25 this title, the Public Health Service Act, or the 


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1 Internal Revenue Code of 1986 the percentage 

2 of the total allowed costs of benefits provided 

3 under a group health plan or health insurance 

4 coverage that are provided by such plan or cov5 erage, the rules contained in the regulations 

6 under this paragraph shall apply. 

7 (3) ALLOWABLE VARIANCE.—The Secretary 

8 shall develop guidelines to provide for a de minimis 

9 variation in the actuarial valuations used in deter10 mining the level of coverage of a plan to account for 

11 differences in actuarial estimates. 

12 (4) PLAN REFERENCE.—In this title, any ref13 erence to a bronze, silver, gold, or platinum plan 

14 shall be treated as a reference to a qualified health 

15 plan providing a bronze, silver, gold, or platinum 

16 level of coverage, as the case may be. 

17 (e) CATASTROPHIC PLAN.— 

18 (1) IN GENERAL.—A health plan not providing 

19 a bronze, silver, gold, or platinum level of coverage 

20 shall be treated as meeting the requirements of sub21 section (d) with respect to any plan year if— 

22 (A) the only individuals who are eligible to 

23 enroll in the plan are individuals described in 

24 paragraph (2); and 

25 (B) the plan provides— 


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1 (i) except as provided in clause (ii), 

2 the essential health benefits determined 

3 under subsection (b), except that the plan 

4 provides no benefits for any plan year until 

5 the individual has incurred cost-sharing ex6 penses in an amount equal to the annual 

7 limitation in effect under subsection (c)(1) 

8 for the plan year (except as provided for in 

9 section 2713); and 

10 (ii) coverage for at least three primary 

11 care visits. 

12 (2) INDIVIDUALS ELIGIBLE FOR ENROLL13 MENT.—An individual is described in this paragraph 

14 for any plan year if the individual— 

15 (A) has not attained the age of 30 before 

16 the beginning of the plan year; or 

17 (B) has a certification in effect for any 

18 plan year under this title that the individual is 

19 exempt from the requirement under section 

20 5000A of the Internal Revenue Code of 1986 

21 by reason of— 

22 (i) section 5000A(e)(1) of such Code 

23 (relating to individuals without affordable 

24 coverage); or 


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1 (ii) section 5000A(e)(5) of such Code 

2 (relating to individuals with hardships). 

3 (3) RESTRICTION TO INDIVIDUAL MARKET.—If 

4 a health insurance issuer offers a health plan de5 scribed in this subsection, the issuer may only offer 

6 the plan in the individual market. 

7 (f) CHILD-ONLY PLANS.—If a qualified health plan 

8 is offered through the Exchange in any level of coverage 

9 specified under subsection (d), the issuer shall also offer 

10 that plan through the Exchange in that level as a plan 

11 in which the only enrollees are individuals who, as of the 

12 beginning of a plan year, have not attained the age of 21, 

13 and such plan shall be treated as a qualified health plan. 

14 SEC. 1303. SPECIAL RULES. 

15 (a) SPECIAL RULES RELATING TO COVERAGE OF

16 ABORTION SERVICES.— 

17 (1) VOLUNTARY CHOICE OF COVERAGE OF

18 ABORTION SERVICES.— 

19 (A) IN GENERAL.—Notwithstanding any 

20 other provision of this title (or any amendment 

21 made by this title), and subject to subpara22 graphs (C) and (D)— 

23 (i) nothing in this title (or any 

24 amendment made by this title), shall be 

25 construed to require a qualified health plan 


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1 to provide coverage of services described in 

2 subparagraph (B)(i) or (B)(ii) as part of 

3 its essential health benefits for any plan 

4 year; and 

5 (ii) the issuer of a qualified health 

6 plan shall determine whether or not the 

7 plan provides coverage of services described 

8 in subparagraph (B)(i) or (B)(ii) as part 

9 of such benefits for the plan year. 

10 (B) ABORTION SERVICES.— 

11 (i) ABORTIONS FOR WHICH PUBLIC

12 FUNDING IS PROHIBITED.—The services 

13 described in this clause are abortions for 

14 which the expenditure of Federal funds ap15 propriated for the Department of Health 

16 and Human Services is not permitted, 

17 based on the law as in effect as of the date 

18 that is 6 months before the beginning of 

19 the plan year involved. 

20 (ii) ABORTIONS FOR WHICH PUBLIC

21 FUNDING IS ALLOWED.—The services de22 scribed in this clause are abortions for 

23 which the expenditure of Federal funds ap24 propriated for the Department of Health 

25 and Human Services is permitted, based 


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1 on the law as in effect as of the date that 

2 is 6 months before the beginning of the 

3 plan year involved. 

4 (C) PROHIBITION ON FEDERAL FUNDS

5 FOR ABORTION SERVICES IN COMMUNITY

6 HEALTH INSURANCE OPTION.— 

7 (i) DETERMINATION BY SEC8 RETARY.—The Secretary may not deter9 mine, in accordance with subparagraph 

10 (A)(ii), that the community health insur11 ance option established under section 1323 

12 shall provide coverage of services described 

13 in subparagraph (B)(i) as part of benefits 

14 for the plan year unless the Secretary— 

15 (I) assures compliance with the 

16 requirements of paragraph (2); 

17 (II) assures, in accordance with 

18 applicable provisions of generally ac19 cepted accounting requirements, circu20 lars on funds management of the Of21 fice of Management and Budget, and 

22 guidance on accounting of the Govern23 ment Accountability Office, that no 

24 Federal funds are used for such cov25 erage; and 


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1 (III) notwithstanding section 

2 1323(e)(1)(C) or any other provision 

3 of this title, takes all necessary steps 

4 to assure that the United States does 

5 not bear the insurance risk for a com6 munity health insurance option’s cov7 erage of services described in subpara8 graph (B)(i). 

9 (ii) STATE REQUIREMENT.—If a State 

10 requires, in addition to the essential health 

11 benefits required under section 1323(b)(3) 

12 (A), coverage of services described in sub13 paragraph (B)(i) for enrollees of a commu14 nity health insurance option offered in 

15 such State, the State shall assure that no 

16 funds flowing through or from the commu17 nity health insurance option, and no other 

18 Federal funds, pay or defray the cost of 

19 providing coverage of services described in 

20 subparagraph (B)(i). The United States 

21 shall not bear the insurance risk for a 

22 State’s required coverage of services de23 scribed in subparagraph (B)(i). 

24 (iii) EXCEPTIONS.—Nothing in this 

25 subparagraph shall apply to coverage of 


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1 services described in subparagraph (B)(ii) 

2 by the community health insurance option. 

3 Services described in subparagraph (B)(ii) 

4 shall be covered to the same extent as such 

5 services are covered under title XIX of the 

6 Social Security Act. 

7 (D) ASSURED AVAILABILITY OF VARIED

8 COVERAGE THROUGH EXCHANGES.— 

9 (i) IN GENERAL.—The Secretary shall 

10 assure that with respect to qualified health 

11 plans offered in any Exchange established 

12 pursuant to this title— 

13 (I) there is at least one such plan 

14 that provides coverage of services de15 scribed in clauses (i) and (ii) of sub16 paragraph (B); and 

17 (II) there is at least one such 

18 plan that does not provide coverage of 

19 services described in subparagraph 

20 (B)(i). 

21 (ii) SPECIAL RULES.—For purposes of 

22 clause (i)— 

23 (I) a plan shall be treated as de24 scribed in clause (i)(II) if the plan 

25 does not provide coverage of services 


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1 described in either subparagraph 

2 (B)(i) or (B)(ii); and 

3 (II) if a State has one Exchange 

4 covering more than 1 insurance mar5 ket, the Secretary shall meet the re6 quirements of clause (i) separately 

7 with respect to each such market. 

8 (2) PROHIBITION ON THE USE OF FEDERAL

9 FUNDS.— 

10 (A) IN GENERAL.—If a qualified health 

11 plan provides coverage of services described in 

12 paragraph (1)(B)(i), the issuer of the plan shall 

13 not use any amount attributable to any of the 

14 following for purposes of paying for such serv15 ices: 

16 (i) The credit under section 36B of 

17 the Internal Revenue Code of 1986 (and 

18 the amount (if any) of the advance pay19 ment of the credit under section 1412 of 

20 the Patient Protection and Affordable Care 

21 Act). 

22 (ii) Any cost-sharing reduction under 

23 section 1402 of thePatient Protection and 

24 Affordable Care Act (and the amount (if 

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1 tion under section 1412 of the Patient 

2 Protection and Affordable Care Act). 

3 (B) SEGREGATION OF FUNDS.—In the case 

4 of a plan to which subparagraph (A) applies, 

5 the issuer of the plan shall, out of amounts not 

6 described in subparagraph (A), segregate an 

7 amount equal to the actuarial amounts deter8 mined under subparagraph (C) for all enrollees 

9 from the amounts described in subparagraph 

10 (A). 

11 (C) ACTUARIAL VALUE OF OPTIONAL

12 SERVICE COVERAGE.— 

13 (i) IN GENERAL.—The Secretary shall 

14 estimate the basic per enrollee, per month 

15 cost, determined on an average actuarial 

16 basis, for including coverage under a quali17 fied health plan of the services described in 

18 paragraph (1)(B)(i). 

19 (ii) CONSIDERATIONS.—In making 

20 such estimate, the Secretary— 

21 (I) may take into account the im22 pact on overall costs of the inclusion 

23 of such coverage, but may not take 

24 into account any cost reduction esti25 mated to result from such services, inVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00122 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 cluding prenatal care, delivery, or 

2 postnatal care; 

3 (II) shall estimate such costs as 

4 if such coverage were included for the 

5 entire population covered; and 

6 (III) may not estimate such a 

7 cost at less than $1 per enrollee, per 

8 month. 

9 (3) PROVIDER CONSCIENCE PROTECTIONS.—No 

10 individual health care provider or health care facility 

11 may be discriminated against because of a willing12 ness or an unwillingness, if doing so is contrary to 

13 the religious or moral beliefs of the provider or facil14 ity, to provide, pay for, provide coverage of, or refer 

15 for abortions. 

16 (b) APPLICATION OF STATE AND FEDERAL LAWS

17 REGARDING ABORTION.— 

18 (1) NO PREEMPTION OF STATE LAWS REGARD19 ING ABORTION.—Nothing in this Act shall be con20 strued to preempt or otherwise have any effect on 

21 State laws regarding the prohibition of (or require22 ment of) coverage, funding, or procedural require23 ments on abortions, including parental notification 

24 or consent for the performance of an abortion on a 

25 minor. 


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1 (2) NO EFFECT ON FEDERAL LAWS REGARDING

2 ABORTION.— 

3 (A) IN GENERAL.—Nothing in this Act 

4 shall be construed to have any effect on Federal 

5 laws regarding— 

6 (i) conscience protection; 

7 (ii) willingness or refusal to provide 

8 abortion; and 

9 (iii) discrimination on the basis of the 

10 willingness or refusal to provide, pay for, 

11 cover, or refer for abortion or to provide or 

12 participate in training to provide abortion. 

13 (3) NO EFFECT ON FEDERAL CIVIL RIGHTS

14 LAW.—Nothing in this subsection shall alter the 

15 rights and obligations of employees and employers 

16 under title VII of the Civil Rights Act of 1964. 

17 (c) APPLICATION OF EMERGENCY SERVICES

18 LAWS.—Nothing in this Act shall be construed to relieve 

19 any health care provider from providing emergency serv20 ices as required by State or Federal law, including section 

21 1867 of the Social Security Act (popularly known as 

22 ‘‘EMTALA’’). 

23 SEC. 1304. RELATED DEFINITIONS. 

24 (a) DEFINITIONS RELATING TO MARKETS.—In this 

25 title: 


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•AMDT. NO. 2786 

1 (1) GROUP MARKET.—The term ‘‘group mar2 ket’’ means the health insurance market under 

3 which individuals obtain health insurance coverage 

4 (directly or through any arrangement) on behalf of 

5 themselves (and their dependents) through a group 

6 health plan maintained by an employer. 

7 (2) INDIVIDUAL MARKET.—The term ‘‘indi8 vidual market’’ means the market for health insur9 ance coverage offered to individuals other than in 

10 connection with a group health plan. 

11 (3) LARGE AND SMALL GROUP MARKETS.—The 

12 terms ‘‘large group market’’ and ‘‘small group mar13 ket’’ mean the health insurance market under which 

14 individuals obtain health insurance coverage (directly 

15 or through any arrangement) on behalf of them16 selves (and their dependents) through a group health 

17 plan maintained by a large employer (as defined in 

18 subsection (b)(1)) or by a small employer (as defined 

19 in subsection (b)(2)), respectively. 

20 (b) EMPLOYERS.—In this title: 

21 (1) LARGE EMPLOYER.—The term ‘‘large em22 ployer’’ means, in connection with a group health 

23 plan with respect to a calendar year and a plan year, 

24 an employer who employed an average of at least 

25 101 employees on business days during the preVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00125 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ceding calendar year and who employs at least 1 em2 ployee on the first day of the plan year. 

3 (2) SMALL EMPLOYER.—The term ‘‘small em4 ployer’’ means, in connection with a group health 

5 plan with respect to a calendar year and a plan year, 

6 an employer who employed an average of at least 1 

7 but not more than 100 employees on business days 

8 during the preceding calendar year and who employs 

9 at least 1 employee on the first day of the plan year. 

10 (3) STATE OPTION TO TREAT 50 EMPLOYEES AS

11 SMALL.—In the case of plan years beginning before 

12 January 1, 2016, a State may elect to apply this 

13 subsection by substituting ‘‘51 employees’’ for ‘‘101 

14 employees’’ in paragraph (1) and by substituting 

15 ‘‘50 employees’’ for ‘‘100 employees’’ in paragraph 

16 (2). 

17 (4) RULES FOR DETERMINING EMPLOYER

18 SIZE.—For purposes of this subsection— 

19 (A) APPLICATION OF AGGREGATION RULE

20 FOR EMPLOYERS.—All persons treated as a sin21 gle employer under subsection (b), (c), (m), or 

22 (o) of section 414 of the Internal Revenue Code 

23 of 1986 shall be treated as 1 employer. 

24 (B) EMPLOYERS NOT IN EXISTENCE IN

25 PRECEDING YEAR.—In the case of an employer 


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•AMDT. NO. 2786 

1 which was not in existence throughout the pre2 ceding calendar year, the determination of 

3 whether such employer is a small or large em4 ployer shall be based on the average number of 

5 employees that it is reasonably expected such 

6 employer will employ on business days in the 

7 current calendar year. 

8 (C) PREDECESSORS.—Any reference in 

9 this subsection to an employer shall include a 

10 reference to any predecessor of such employer. 

11 (D) CONTINUATION OF PARTICIPATION

12 FOR GROWING SMALL EMPLOYERS.—If— 

13 (i) a qualified employer that is a small 

14 employer makes enrollment in qualified 

15 health plans offered in the small group 

16 market available to its employees through 

17 an Exchange; and 

18 (ii) the employer ceases to be a small 

19 employer by reason of an increase in the 

20 number of employees of such employer; 

21 the employer shall continue to be treated as a 

22 small employer for purposes of this subtitle for 

23 the period beginning with the increase and end24 ing with the first day on which the employer 


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1 does not make such enrollment available to its 

2 employees. 

3 (c) SECRETARY.—In this title, the term ‘‘Secretary’’ 

4 means the Secretary of Health and Human Services. 

5 (d) STATE.—In this title, the term ‘‘State’’ means 

6 each of the 50 States and the District of Columbia. 

7 PART II—CONSUMER CHOICES AND INSURANCE 

8 COMPETITION THROUGH HEALTH BENEFIT 

9 EXCHANGES 

10 SEC. 1311. AFFORDABLE CHOICES OF HEALTH BENEFIT 

11 PLANS. 

12 (a) ASSISTANCE TO STATES TO ESTABLISH AMER13 ICAN HEALTH BENEFIT EXCHANGES.— 

14 (1) PLANNING AND ESTABLISHMENT

15 GRANTS.—There shall be appropriated to the Sec16 retary, out of any moneys in the Treasury not other17 wise appropriated, an amount necessary to enable 

18 the Secretary to make awards, not later than 1 year 

19 after the date of enactment of this Act, to States in 

20 the amount specified in paragraph (2) for the uses 

21 described in paragraph (3). 

22 (2) AMOUNT SPECIFIED.—For each fiscal year, 

23 the Secretary shall determine the total amount that 

24 the Secretary will make available to each State for 

25 grants under this subsection. 


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1 (3) USE OF FUNDS.—A State shall use 

2 amounts awarded under this subsection for activities 

3 (including planning activities) related to establishing 

4 an American Health Benefit Exchange, as described 

5 in subsection (b). 

6 (4) RENEWABILITY OF GRANT.— 

7 (A) IN GENERAL.—Subject to subsection 

8 (d)(4), the Secretary may renew a grant award9 ed under paragraph (1) if the State recipient of 

10 such grant— 

11 (i) is making progress, as determined 

12 by the Secretary, toward— 

13 (I) establishing an Exchange; 

14 and 

15 (II) implementing the reforms 

16 described in subtitles A and C (and 

17 the amendments made by such sub18 titles); and 

19 (ii) is meeting such other benchmarks 

20 as the Secretary may establish. 

21 (B) LIMITATION.—No grant shall be 

22 awarded under this subsection after January 1, 

23 2015. 

24 (5) TECHNICAL ASSISTANCE TO FACILITATE

25 PARTICIPATION IN SHOP EXCHANGES.—The SecVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00129 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 retary shall provide technical assistance to States to 

2 facilitate the participation of qualified small busi3 nesses in such States in SHOP Exchanges. 

4 (b) AMERICAN HEALTH BENEFIT EXCHANGES.— 

5 (1) IN GENERAL.—Each State shall, not later 

6 than January 1, 2014, establish an American Health 

7 Benefit Exchange (referred to in this title as an 

8 ‘‘Exchange’’) for the State that— 

9 (A) facilitates the purchase of qualified 

10 health plans; 

11 (B) provides for the establishment of a 

12 Small Business Health Options Program (in 

13 this title referred to as a ‘‘SHOP Exchange’’) 

14 that is designed to assist qualified employers in 

15 the State who are small employers in facili16 tating the enrollment of their employees in 

17 qualified health plans offered in the small group 

18 market in the State; and 

19 (C) meets the requirements of subsection 

20 (d). 

21 (2) MERGER OF INDIVIDUAL AND SHOP EX22 CHANGES.—A State may elect to provide only one 

23 Exchange in the State for providing both Exchange 

24 and SHOP Exchange services to both qualified indi25 viduals and qualified small employers, but only if the 


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1 Exchange has adequate resources to assist such indi2 viduals and employers. 

3 (c) RESPONSIBILITIES OF THE SECRETARY.— 

4 (1) IN GENERAL.—The Secretary shall, by reg5 ulation, establish criteria for the certification of 

6 health plans as qualified health plans. Such criteria 

7 shall require that, to be certified, a plan shall, at a 

8 minimum— 

9 (A) meet marketing requirements, and not 

10 employ marketing practices or benefit designs 

11 that have the effect of discouraging the enroll12 ment in such plan by individuals with signifi13 cant health needs; 

14 (B) ensure a sufficient choice of providers 

15 (in a manner consistent with applicable network 

16 adequacy provisions under section 2702(c) of 

17 the Public Health Service Act), and provide in18 formation to enrollees and prospective enrollees 

19 on the availability of in-network and out-of-net20 work providers; 

21 (C) include within health insurance plan 

22 networks those essential community providers, 

23 where available, that serve predominately low24 income, medically-underserved individuals, such 

25 as health care providers defined in section 


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1 340B(a)(4) of the Public Health Service Act 

2 and providers described in section 

3 1927(c)(1)(D)(i)(IV) of the Social Security Act 

4 as set forth by section 221 of Public Law 111- 

5 8, except that nothing in this subparagraph 

6 shall be construed to require any health plan to 

7 provide coverage for any specific medical proce8 dure; 

9 (D)(i) be accredited with respect to local 

10 performance on clinical quality measures such 

11 as the Healthcare Effectiveness Data and Infor12 mation Set, patient experience ratings on a 

13 standardized Consumer Assessment of 

14 Healthcare Providers and Systems survey, as 

15 well as consumer access, utilization manage16 ment, quality assurance, provider credentialing, 

17 complaints and appeals, network adequacy and 

18 access, and patient information programs by 

19 any entity recognized by the Secretary for the 

20 accreditation of health insurance issuers or 

21 plans (so long as any such entity has trans22 parent and rigorous methodological and scoring 

23 criteria); or 

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1 creditation that is applicable to all qualified 

2 health plans; 

3 (E) implement a quality improvement 

4 strategy described in subsection (g)(1); 

5 (F) utilize a uniform enrollment form that 

6 qualified individuals and qualified employers 

7 may use (either electronically or on paper) in 

8 enrolling in qualified health plans offered 

9 through such Exchange, and that takes into ac10 count criteria that the National Association of 

11 Insurance Commissioners develops and submits 

12 to the Secretary; 

13 (G) utilize the standard format established 

14 for presenting health benefits plan options; and 

15 (H) provide information to enrollees and 

16 prospective enrollees, and to each Exchange in 

17 which the plan is offered, on any quality meas18 ures for health plan performance endorsed 

19 under section 399JJ of the Public Health Serv20 ice Act, as applicable. 

21 (2) RULE OF CONSTRUCTION.—Nothing in 

22 paragraph (1)(C) shall be construed to require a 

23 qualified health plan to contract with a provider de24 scribed in such paragraph if such provider refuses to 


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1 accept the generally applicable payment rates of 

2 such plan. 

3 (3) RATING SYSTEM.—The Secretary shall de4 velop a rating system that would rate qualified 

5 health plans offered through an Exchange in each 

6 benefits level on the basis of the relative quality and 

7 price. The Exchange shall include the quality rating 

8 in the information provided to individuals and em9 ployers through the Internet portal established 

10 under paragraph (4). 

11 (4) INTERNET PORTALS.—The Secretary 

12 shall— 

13 (A) continue to operate, maintain, and up14 date the Internet portal developed under section 

15 1103(a) and to assist States in developing and 

16 maintaining their own such portal; and 

17 (B) make available for use by Exchanges a 

18 model template for an Internet portal that may 

19 be used to direct qualified individuals and quali20 fied employers to qualified health plans, to as21 sist such individuals and employers in deter22 mining whether they are eligible to participate 

23 in an Exchange or eligible for a premium tax 

24 credit or cost-sharing reduction, and to present 

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1 ings) regarding qualified health plans offered 

2 through an Exchange to assist consumers in 

3 making easy health insurance choices. 

4 Such template shall include, with respect to each 

5 qualified health plan offered through the Exchange 

6 in each rating area, access to the uniform outline of 

7 coverage the plan is required to provide under sec8 tion 2716 of the Public Health Service Act and to 

9 a copy of the plan’s written policy. 

10 (5) ENROLLMENT PERIODS.—The Secretary 

11 shall require an Exchange to provide for— 

12 (A) an initial open enrollment, as deter13 mined by the Secretary (such determination to 

14 be made not later than July 1, 2012); 

15 (B) annual open enrollment periods, as de16 termined by the Secretary for calendar years 

17 after the initial enrollment period; 

18 (C) special enrollment periods specified in 

19 section 9801 of the Internal Revenue Code of 

20 1986 and other special enrollment periods 

21 under circumstances similar to such periods 

22 under part D of title XVIII of the Social Secu23 rity Act; and 


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1 (D) special monthly enrollment periods for 

2 Indians (as defined in section 4 of the Indian 

3 Health Care Improvement Act). 

4 (d) REQUIREMENTS.— 

5 (1) IN GENERAL.—An Exchange shall be a gov6 ernmental agency or nonprofit entity that is estab7 lished by a State. 

8 (2) OFFERING OF COVERAGE.— 

9 (A) IN GENERAL.—An Exchange shall 

10 make available qualified health plans to quali11 fied individuals and qualified employers. 

12 (B) LIMITATION.— 

13 (i) IN GENERAL.—An Exchange may 

14 not make available any health plan that is 

15 not a qualified health plan. 

16 (ii) OFFERING OF STAND-ALONE DEN17 TAL BENEFITS.—Each Exchange within a 

18 State shall allow an issuer of a plan that 

19 only provides limited scope dental benefits 

20 meeting the requirements of section 

21 9832(c)(2)(A) of the Internal Revenue 

22 Code of 1986 to offer the plan through the 

23 Exchange (either separately or in conjunc24 tion with a qualified health plan) if the 

25 plan provides pediatric dental benefits 


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1 meeting the requirements of section 

2 1302(b)(1)(J)). 

3 (3) RULES RELATING TO ADDITIONAL RE4 QUIRED BENEFITS.— 

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

6 subparagraph (B), an Exchange may make 

7 available a qualified health plan notwith8 standing any provision of law that may require 

9 benefits other than the essential health benefits 

10 specified under section 1302(b). 

11 (B) STATES MAY REQUIRE ADDITIONAL

12 BENEFITS.— 

13 (i) IN GENERAL.—Subject to the re14 quirements of clause (ii), a State may re15 quire that a qualified health plan offered 

16 in such State offer benefits in addition to 

17 the essential health benefits specified 

18 under section 1302(b). 

19 (ii) STATE MUST ASSUME COST.—A 

20 State shall make payments to or on behalf 

21 of an individual eligible for the premium 

22 tax credit under section 36B of the Inter23 nal Revenue Code of 1986 and any cost24 sharing reduction under section 1402 to 

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1 ditional benefits described in clause (i) 

2 which are not eligible for such credit or re3 duction under section 36B(b)(3)(D) of 

4 such Code and section 1402(c)(4). 

5 (4) FUNCTIONS.—An Exchange shall, at a min6 imum— 

7 (A) implement procedures for the certifi8 cation, recertification, and decertification, con9 sistent with guidelines developed by the Sec10 retary under subsection (c), of health plans as 

11 qualified health plans; 

12 (B) provide for the operation of a toll-free 

13 telephone hotline to respond to requests for as14 sistance; 

15 (C) maintain an Internet website through 

16 which enrollees and prospective enrollees of 

17 qualified health plans may obtain standardized 

18 comparative information on such plans; 

19 (D) assign a rating to each qualified health 

20 plan offered through such Exchange in accord21 ance with the criteria developed by the Sec22 retary under subsection (c)(3); 

23 (E) utilize a standardized format for pre24 senting health benefits plan options in the Ex25 change, including the use of the uniform outline 


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1 of coverage established under section 2715 of 

2 the Public Health Service Act; 

3 (F) in accordance with section 1413, in4 form individuals of eligibility requirements for 

5 the medicaid program under title XIX of the 

6 Social Security Act, the CHIP program under 

7 title XXI of such Act, or any applicable State 

8 or local public program and if through screen9 ing of the application by the Exchange, the Ex10 change determines that such individuals are eli11 gible for any such program, enroll such individ12 uals in such program; 

13 (G) establish and make available by elec14 tronic means a calculator to determine the ac15 tual cost of coverage after the application of 

16 any premium tax credit under section 36B of 

17 the Internal Revenue Code of 1986 and any 

18 cost-sharing reduction under section 1402; 

19 (H) subject to section 1411, grant a cer20 tification attesting that, for purposes of the in21 dividual responsibility penalty under section 

22 5000A of the Internal Revenue Code of 1986, 

23 an individual is exempt from the individual re24 quirement or from the penalty imposed by such 

25 section because— 


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1 (i) there is no affordable qualified 

2 health plan available through the Ex3 change, or the individual’s employer, cov4 ering the individual; or 

5 (ii) the individual meets the require6 ments for any other such exemption from 

7 the individual responsibility requirement or 

8 penalty; 

9 (I) transfer to the Secretary of the Treas10 ury— 

11 (i) a list of the individuals who are 

12 issued a certification under subparagraph 

13 (H), including the name and taxpayer 

14 identification number of each individual; 

15 (ii) the name and taxpayer identifica16 tion number of each individual who was an 

17 employee of an employer but who was de18 termined to be eligible for the premium tax 

19 credit under section 36B of the Internal 

20 Revenue Code of 1986 because— 

21 (I) the employer did not provide 

22 minimum essential coverage; or 

23 (II) the employer provided such 

24 minimum essential coverage but it 

25 was determined under section 


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1 36B(c)(2)(C) of such Code to either 

2 be unaffordable to the employee or 

3 not provide the required minimum ac4 tuarial value; and 

5 (iii) the name and taxpayer identifica6 tion number of each individual who notifies 

7 the Exchange under section 1411(b)(4) 

8 that they have changed employers and of 

9 each individual who ceases coverage under 

10 a qualified health plan during a plan year 

11 (and the effective date of such cessation); 

12 (J) provide to each employer the name of 

13 each employee of the employer described in sub14 paragraph (I)(ii) who ceases coverage under a 

15 qualified health plan during a plan year (and 

16 the effective date of such cessation); and 

17 (K) establish the Navigator program de18 scribed in subsection (i). 

19 (5) FUNDING LIMITATIONS.— 

20 (A) NO FEDERAL FUNDS FOR CONTINUED

21 OPERATIONS.—In establishing an Exchange 

22 under this section, the State shall ensure that 

23 such Exchange is self-sustaining beginning on 

24 January 1, 2015, including allowing the Ex25 change to charge assessments or user fees to 


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1 participating health insurance issuers, or to 

2 otherwise generate funding, to support its oper3 ations. 

4 (B) PROHIBITING WASTEFUL USE OF

5 FUNDS.—In carrying out activities under this 

6 subsection, an Exchange shall not utilize any 

7 funds intended for the administrative and oper8 ational expenses of the Exchange for staff re9 treats, promotional giveaways, excessive execu10 tive compensation, or promotion of Federal or 

11 State legislative and regulatory modifications. 

12 (6) CONSULTATION.—An Exchange shall con13 sult with stakeholders relevant to carrying out the 

14 activities under this section, including— 

15 (A) health care consumers who are enroll16 ees in qualified health plans; 

17 (B) individuals and entities with experience 

18 in facilitating enrollment in qualified health 

19 plans; 

20 (C) representatives of small businesses and 

21 self-employed individuals; 

22 (D) State Medicaid offices; and 

23 (E) advocates for enrolling hard to reach 

24 populations. 


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1 (7) PUBLICATION OF COSTS.—An Exchange 

2 shall publish the average costs of licensing, regu3 latory fees, and any other payments required by the 

4 Exchange, and the administrative costs of such Ex5 change, on an Internet website to educate consumers 

6 on such costs. Such information shall also include 

7 monies lost to waste, fraud, and abuse. 

8 (e) CERTIFICATION.— 

9 (1) IN GENERAL.—An Exchange may certify a 

10 health plan as a qualified health plan if— 

11 (A) such health plan meets the require12 ments for certification as promulgated by the 

13 Secretary under subsection (c)(1); and 

14 (B) the Exchange determines that making 

15 available such health plan through such Ex16 change is in the interests of qualified individ17 uals and qualified employers in the State or 

18 States in which such Exchange operates, except 

19 that the Exchange may not exclude a health 

20 plan— 

21 (i) on the basis that such plan is a 

22 fee-for-service plan; 

23 (ii) through the imposition of pre24 mium price controls; or 


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1 (iii) on the basis that the plan pro2 vides treatments necessary to prevent pa3 tients’ deaths in circumstances the Ex4 change determines are inappropriate or too 

5 costly. 

6 (2) PREMIUM CONSIDERATIONS.—The Ex7 change shall require health plans seeking certifi8 cation as qualified health plans to submit a justifica9 tion for any premium increase prior to implementa10 tion of the increase. Such plans shall prominently 

11 post such information on their websites. The Ex12 change may take this information, and the informa13 tion and the recommendations provided to the Ex14 change by the State under section 2794(b)(1) of the 

15 Public Health Service Act (relating to patterns or 

16 practices of excessive or unjustified premium in17 creases), into consideration when determining wheth18 er to make such health plan available through the 

19 Exchange. The Exchange shall take into account any 

20 excess of premium growth outside the Exchange as 

21 compared to the rate of such growth inside the Ex22 change, including information reported by the 

23 States. 

24 (f) FLEXIBILITY.— 


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1 (1) REGIONAL OR OTHER INTERSTATE EX2 CHANGES.—An Exchange may operate in more than 

3 one State if— 

4 (A) each State in which such Exchange op5 erates permits such operation; and 

6 (B) the Secretary approves such regional 

7 or interstate Exchange. 

8 (2) SUBSIDIARY EXCHANGES.—A State may es9 tablish one or more subsidiary Exchanges if— 

10 (A) each such Exchange serves a geo11 graphically distinct area; and 

12 (B) the area served by each such Exchange 

13 is at least as large as a rating area described 

14 in section 2701(a) of the Public Health Service 

15 Act. 

16 (3) AUTHORITY TO CONTRACT.— 

17 (A) IN GENERAL.—A State may elect to 

18 authorize an Exchange established by the State 

19 under this section to enter into an agreement 

20 with an eligible entity to carry out 1 or more 

21 responsibilities of the Exchange. 

22 (B) ELIGIBLE ENTITY.—In this para23 graph, the term ‘‘eligible entity’’ means— 

24 (i) a person— 


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1 (I) incorporated under, and sub2 ject to the laws of, 1 or more States; 

3 (II) that has demonstrated expe4 rience on a State or regional basis in 

5 the individual and small group health 

6 insurance markets and in benefits cov7 erage; and 

8 (III) that is not a health insur9 ance issuer or that is treated under 

10 subsection (a) or (b) of section 52 of 

11 the Internal Revenue Code of 1986 as 

12 a member of the same controlled 

13 group of corporations (or under com14 mon control with) as a health insur15 ance issuer; or 

16 (ii) the State medicaid agency under 

17 title XIX of the Social Security Act. 

18 (g) REWARDING QUALITY THROUGH MARKET19 BASED INCENTIVES.— 

20 (1) STRATEGY DESCRIBED.—A strategy de21 scribed in this paragraph is a payment structure 

22 that provides increased reimbursement or other in23 centives for— 

24 (A) improving health outcomes through the 

25 implementation of activities that shall include 


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1 quality reporting, effective case management, 

2 care coordination, chronic disease management, 

3 medication and care compliance initiatives, in4 cluding through the use of the medical home 

5 model, for treatment or services under the plan 

6 or coverage; 

7 (B) the implementation of activities to pre8 vent hospital readmissions through a com9 prehensive program for hospital discharge that 

10 includes patient-centered education and coun11 seling, comprehensive discharge planning, and 

12 post discharge reinforcement by an appropriate 

13 health care professional; 

14 (C) the implementation of activities to im15 prove patient safety and reduce medical errors 

16 through the appropriate use of best clinical 

17 practices, evidence based medicine, and health 

18 information technology under the plan or cov19 erage; and 

20 (D) the implementation of wellness and 

21 health promotion activities. 

22 (2) GUIDELINES.—The Secretary, in consulta23 tion with experts in health care quality and stake24 holders, shall develop guidelines concerning the mat25 ters described in paragraph (1). 


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1 (3) REQUIREMENTS.—The guidelines developed 

2 under paragraph (2) shall require the periodic re3 porting to the applicable Exchange of the activities 

4 that a qualified health plan has conducted to imple5 ment a strategy described in paragraph (1). 

6 (h) QUALITY IMPROVEMENT.— 

7 (1) ENHANCING PATIENT SAFETY.—Beginning 

8 on January 1, 2015, a qualified health plan may 

9 contract with— 

10 (A) a hospital with greater than 50 beds 

11 only if such hospital— 

12 (i) utilizes a patient safety evaluation 

13 system as described in part C of title IX 

14 of the Public Health Service Act; and 

15 (ii) implements a mechanism to en16 sure that each patient receives a com17 prehensive program for hospital discharge 

18 that includes patient-centered education 

19 and counseling, comprehensive discharge 

20 planning, and post discharge reinforcement 

21 by an appropriate health care professional; 

22 or 

23 (B) a health care provider only if such pro24 vider implements such mechanisms to improve 


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1 health care quality as the Secretary may by reg2 ulation require. 

3 (2) EXCEPTIONS.—The Secretary may establish 

4 reasonable exceptions to the requirements described 

5 in paragraph (1). 

6 (3) ADJUSTMENT.—The Secretary may by reg7 ulation adjust the number of beds described in para8 graph (1)(A). 

9 (i) NAVIGATORS.— 

10 (1) IN GENERAL.—An Exchange shall establish 

11 a program under which it awards grants to entities 

12 described in paragraph (2) to carry out the duties 

13 described in paragraph (3). 

14 (2) ELIGIBILITY.— 

15 (A) IN GENERAL.—To be eligible to receive 

16 a grant under paragraph (1), an entity shall 

17 demonstrate to the Exchange involved that the 

18 entity has existing relationships, or could read19 ily establish relationships, with employers and 

20 employees, consumers (including uninsured and 

21 underinsured consumers), or self-employed indi22 viduals likely to be qualified to enroll in a quali23 fied health plan. 

24 (B) TYPES.—Entities described in sub25 paragraph (A) may include trade, industry, and 


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1 professional associations, commercial fishing in2 dustry organizations, ranching and farming or3 ganizations, community and consumer-focused 

4 nonprofit groups, chambers of commerce, 

5 unions, small business development centers, 

6 other licensed insurance agents and brokers, 

7 and other entities that— 

8 (i) are capable of carrying out the du9 ties described in paragraph (3); 

10 (ii) meet the standards described in 

11 paragraph (4); and 

12 (iii) provide information consistent 

13 with the standards developed under para14 graph (5). 

15 (3) DUTIES.—An entity that serves as a navi16 gator under a grant under this subsection shall— 

17 (A) conduct public education activities to 

18 raise awareness of the availability of qualified 

19 health plans; 

20 (B) distribute fair and impartial informa21 tion concerning enrollment in qualified health 

22 plans, and the availability of premium tax cred23 its under section 36B of the Internal Revenue 

24 Code of 1986 and cost-sharing reductions under 

25 section 1402; 


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1 (C) facilitate enrollment in qualified health 

2 plans; 

3 (D) provide referrals to any applicable of4 fice of health insurance consumer assistance or 

5 health insurance ombudsman established under 

6 section 2793 of the Public Health Service Act, 

7 or any other appropriate State agency or agen8 cies, for any enrollee with a grievance, com9 plaint, or question regarding their health plan, 

10 coverage, or a determination under such plan or 

11 coverage; and 

12 (E) provide information in a manner that 

13 is culturally and linguistically appropriate to 

14 the needs of the population being served by the 

15 Exchange or Exchanges. 

16 (4) STANDARDS.— 

17 (A) IN GENERAL.—The Secretary shall es18 tablish standards for navigators under this sub19 section, including provisions to ensure that any 

20 private or public entity that is selected as a 

21 navigator is qualified, and licensed if appro22 priate, to engage in the navigator activities de23 scribed in this subsection and to avoid conflicts 

24 of interest. Under such standards, a navigator 

25 shall not— 


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1 (i) be a health insurance issuer; or 

2 (ii) receive any consideration directly 

3 or indirectly from any health insurance 

4 issuer in connection with the enrollment of 

5 any qualified individuals or employees of a 

6 qualified employer in a qualified health 

7 plan. 

8 (5) FAIR AND IMPARTIAL INFORMATION AND

9 SERVICES.—The Secretary, in collaboration with 

10 States, shall develop standards to ensure that infor11 mation made available by navigators is fair, accu12 rate, and impartial. 

13 (6) FUNDING.—Grants under this subsection 

14 shall be made from the operational funds of the Ex15 change and not Federal funds received by the State 

16 to establish the Exchange. 

17 (j) APPLICABILITY OF MENTAL HEALTH PARITY.— 

18 Section 2726 of the Public Health Service Act shall apply 

19 to qualified health plans in the same manner and to the 

20 same extent as such section applies to health insurance 

21 issuers and group health plans. 

22 (k) CONFLICT.—An Exchange may not establish 

23 rules that conflict with or prevent the application of regu24 lations promulgated by the Secretary under this subtitle. 


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1 SEC. 1312. CONSUMER CHOICE. 

2 (a) CHOICE.— 

3 (1) QUALIFIED INDIVIDUALS.—A qualified indi4 vidual may enroll in any qualified health plan avail5 able to such individual. 

6 (2) QUALIFIED EMPLOYERS.— 

7 (A) EMPLOYER MAY SPECIFY LEVEL.—A 

8 qualified employer may provide support for cov9 erage of employees under a qualified health 

10 plan by selecting any level of coverage under 

11 section 1302(d) to be made available to employ12 ees through an Exchange. 

13 (B) EMPLOYEE MAY CHOOSE PLANS WITH14 IN A LEVEL.—Each employee of a qualified em15 ployer that elects a level of coverage under sub16 paragraph (A) may choose to enroll in a quali17 fied health plan that offers coverage at that 

18 level. 

19 (b) PAYMENT OF PREMIUMS BY QUALIFIED INDIVID20 UALS.—A qualified individual enrolled in any qualified 

21 health plan may pay any applicable premium owed by such 

22 individual to the health insurance issuer issuing such 

23 qualified health plan. 

24 (c) SINGLE RISK POOL.— 

25 (1) INDIVIDUAL MARKET.—A health insurance 

26 issuer shall consider all enrollees in all health plans 


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1 (other than grandfathered health plans) offered by 

2 such issuer in the individual market, including those 

3 enrollees who do not enroll in such plans through 

4 the Exchange, to be members of a single risk pool. 

5 (2) SMALL GROUP MARKET.—A health insur6 ance issuer shall consider all enrollees in all health 

7 plans (other than grandfathered health plans) of8 fered by such issuer in the small group market, in9 cluding those enrollees who do not enroll in such 

10 plans through the Exchange, to be members of a 

11 single risk pool. 

12 (3) MERGER OF MARKETS.—A State may re13 quire the individual and small group insurance mar14 kets within a State to be merged if the State deter15 mines appropriate. 

16 (4) STATE LAW.—A State law requiring grand17 fathered health plans to be included in a pool de18 scribed in paragraph (1) or (2) shall not apply. 

19 (d) EMPOWERING CONSUMER CHOICE.— 

20 (1) CONTINUED OPERATION OF MARKET OUT21 SIDE EXCHANGES.—Nothing in this title shall be 

22 construed to prohibit— 

23 (A) a health insurance issuer from offering 

24 outside of an Exchange a health plan to a 

25 qualified individual or qualified employer; and 


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1 (B) a qualified individual from enrolling in, 

2 or a qualified employer from selecting for its 

3 employees, a health plan offered outside of an 

4 Exchange. 

5 (2) CONTINUED OPERATION OF STATE BENEFIT

6 REQUIREMENTS.—Nothing in this title shall be con7 strued to terminate, abridge, or limit the operation 

8 of any requirement under State law with respect to 

9 any policy or plan that is offered outside of an Ex10 change to offer benefits. 

11 (3) VOLUNTARY NATURE OF AN EXCHANGE.— 

12 (A) CHOICE TO ENROLL OR NOT TO EN13 ROLL.—Nothing in this title shall be construed 

14 to restrict the choice of a qualified individual to 

15 enroll or not to enroll in a qualified health plan 

16 or to participate in an Exchange. 

17 (B) PROHIBITION AGAINST COMPELLED

18 ENROLLMENT.—Nothing in this title shall be 

19 construed to compel an individual to enroll in a 

20 qualified health plan or to participate in an Ex21 change. 

22 (C) INDIVIDUALS ALLOWED TO ENROLL IN

23 ANY PLAN.—A qualified individual may enroll 

24 in any qualified health plan, except that in the 

25 case of a catastrophic plan described in section 


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1 1302(e), a qualified individual may enroll in the 

2 plan only if the individual is eligible to enroll in 

3 the plan under section 1302(e)(2). 

4 (D) MEMBERS OF CONGRESS IN THE EX5 CHANGE.— 

6 (i) REQUIREMENT.—Notwithstanding 

7 any other provision of law, after the effec8 tive date of this subtitle, the only health 

9 plans that the Federal Government may 

10 make available to Members of Congress 

11 and congressional staff with respect to 

12 their service as a Member of Congress or 

13 congressional staff shall be health plans 

14 that are— 

15 (I) created under this Act (or an 

16 amendment made by this Act); or 

17 (II) offered through an Exchange 

18 established under this Act (or an 

19 amendment made by this Act). 

20 (ii) DEFINITIONS.—In this section: 

21 (I) MEMBER OF CONGRESS.— 

22 The term ‘‘Member of Congress’’ 

23 means any member of the House of 

24 Representatives or the Senate. 


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1 (II) CONGRESSIONAL STAFF.— 

2 The term ‘‘congressional staff’’ means 

3 all full-time and part-time employees 

4 employed by the official office of a 

5 Member of Congress, whether in 

6 Washington, DC or outside of Wash7 ington, DC. 

8 (4) NO PENALTY FOR TRANSFERRING TO MIN9 IMUM ESSENTIAL COVERAGE OUTSIDE EXCHANGE.— 

10 An Exchange, or a qualified health plan offered 

11 through an Exchange, shall not impose any penalty 

12 or other fee on an individual who cancels enrollment 

13 in a plan because the individual becomes eligible for 

14 minimum essential coverage (as defined in section 

15 5000A(f) of the Internal Revenue Code of 1986 

16 without regard to paragraph (1)(C) or (D) thereof) 

17 or such coverage becomes affordable (within the 

18 meaning of section 36B(c)(2)(C) of such Code). 

19 (e) ENROLLMENT THROUGH AGENTS OR BRO20 KERS.—The Secretary shall establish procedures under 

21 which a State may allow agents or brokers— 

22 (1) to enroll individuals in any qualified health 

23 plans in the individual or small group market as 

24 soon as the plan is offered through an Exchange in 

25 the State; and 


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1 (2) to assist individuals in applying for pre2 mium tax credits and cost-sharing reductions for 

3 plans sold through an Exchange. 

4 Such procedures may include the establishment of rate 

5 schedules for broker commissions paid by health benefits 

6 plans offered through an exchange. 

7 (f) QUALIFIED INDIVIDUALS AND EMPLOYERS; AC8 CESS LIMITED TO CITIZENS AND LAWFUL RESIDENTS.— 

9 (1) QUALIFIED INDIVIDUALS.—In this title: 

10 (A) IN GENERAL.—The term ‘‘qualified in11 dividual’’ means, with respect to an Exchange, 

12 an individual who— 

13 (i) is seeking to enroll in a qualified 

14 health plan in the individual market of15 fered through the Exchange; and 

16 (ii) resides in the State that estab17 lished the Exchange (except with respect to 

18 territorial agreements under section 

19 1312(f)). 

20 (B) INCARCERATED INDIVIDUALS EX21 CLUDED.—An individual shall not be treated as 

22 a qualified individual if, at the time of enroll23 ment, the individual is incarcerated, other than 

24 incarceration pending the disposition of 

25 charges. 


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1 (2) QUALIFIED EMPLOYER.—In this title: 

2 (A) IN GENERAL.—The term ‘‘qualified 

3 employer’’ means a small employer that elects 

4 to make all full-time employees of such em5 ployer eligible for 1 or more qualified health 

6 plans offered in the small group market 

7 through an Exchange that offers qualified 

8 health plans. 

9 (B) EXTENSION TO LARGE GROUPS.— 

10 (i) IN GENERAL.—Beginning in 2017, 

11 each State may allow issuers of health in12 surance coverage in the large group mar13 ket in the State to offer qualified health 

14 plans in such market through an Ex15 change. Nothing in this subparagraph shall 

16 be construed as requiring the issuer to 

17 offer such plans through an Exchange. 

18 (ii) LARGE EMPLOYERS ELIGIBLE.—If 

19 a State under clause (i) allows issuers to 

20 offer qualified health plans in the large 

21 group market through an Exchange, the 

22 term ‘‘qualified employer’’ shall include a 

23 large employer that elects to make all full24 time employees of such employer eligible 

25 for 1 or more qualified health plans offered 


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1 in the large group market through the Ex2 change. 

3 (3) ACCESS LIMITED TO LAWFUL RESIDENTS.— 

4 If an individual is not, or is not reasonably expected 

5 to be for the entire period for which enrollment is 

6 sought, a citizen or national of the United States or 

7 an alien lawfully present in the United States, the 

8 individual shall not be treated as a qualified indi9 vidual and may not be covered under a qualified 

10 health plan in the individual market that is offered 

11 through an Exchange. 

12 SEC. 1313. FINANCIAL INTEGRITY. 

13 (a) ACCOUNTING FOR EXPENDITURES.— 

14 (1) IN GENERAL.—An Exchange shall keep an 

15 accurate accounting of all activities, receipts, and ex16 penditures and shall annually submit to the Sec17 retary a report concerning such accountings. 

18 (2) INVESTIGATIONS.—The Secretary, in co19 ordination with the Inspector General of the Depart20 ment of Health and Human Services, may inves21 tigate the affairs of an Exchange, may examine the 

22 properties and records of an Exchange, and may re23 quire periodic reports in relation to activities under24 taken by an Exchange. An Exchange shall fully coVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00160 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 operate in any investigation conducted under this 

2 paragraph. 

3 (3) AUDITS.—An Exchange shall be subject to 

4 annual audits by the Secretary. 

5 (4) PATTERN OF ABUSE.—If the Secretary de6 termines that an Exchange or a State has engaged 

7 in serious misconduct with respect to compliance 

8 with the requirements of, or carrying out of activi9 ties required under, this title, the Secretary may re10 scind from payments otherwise due to such State in11 volved under this or any other Act administered by 

12 the Secretary an amount not to exceed 1 percent of 

13 such payments per year until corrective actions are 

14 taken by the State that are determined to be ade15 quate by the Secretary. 

16 (5) PROTECTIONS AGAINST FRAUD AND

17 ABUSE.—With respect to activities carried out under 

18 this title, the Secretary shall provide for the efficient 

19 and non-discriminatory administration of Exchange 

20 activities and implement any measure or procedure 

21 that— 

22 (A) the Secretary determines is appro23 priate to reduce fraud and abuse in the admin24 istration of this title; and 


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1 (B) the Secretary has authority to imple2 ment under this title or any other Act. 

3 (6) APPLICATION OF THE FALSE CLAIMS

4 ACT.— 

5 (A) IN GENERAL.—Payments made by, 

6 through, or in connection with an Exchange are 

7 subject to the False Claims Act (31 U.S.C. 

8 3729 et seq.) if those payments include any 

9 Federal funds. Compliance with the require10 ments of this Act concerning eligibility for a 

11 health insurance issuer to participate in the Ex12 change shall be a material condition of an 

13 issuer’s entitlement to receive payments, includ14 ing payments of premium tax credits and cost15 sharing reductions, through the Exchange. 

16 (B) DAMAGES.—Notwithstanding para17 graph (1) of section 3729(a) of title 31, United 

18 States Code, and subject to paragraph (2) of 

19 such section, the civil penalty assessed under 

20 the False Claims Act on any person found liable 

21 under such Act as described in subparagraph 

22 (A) shall be increased by not less than 3 times 

23 and not more than 6 times the amount of dam24 ages which the Government sustains because of 

25 the act of that person. 


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1 (b) GAO OVERSIGHT.—Not later than 5 years after 

2 the first date on which Exchanges are required to be oper3 ational under this title, the Comptroller General shall con4 duct an ongoing study of Exchange activities and the en5 rollees in qualified health plans offered through Ex6 changes. Such study shall review— 

7 (1) the operations and administration of Ex8 changes, including surveys and reports of qualified 

9 health plans offered through Exchanges and on the 

10 experience of such plans (including data on enrollees 

11 in Exchanges and individuals purchasing health in12 surance coverage outside of Exchanges), the ex13 penses of Exchanges, claims statistics relating to 

14 qualified health plans, complaints data relating to 

15 such plans, and the manner in which Exchanges 

16 meet their goals; 

17 (2) any significant observations regarding the 

18 utilization and adoption of Exchanges; 

19 (3) where appropriate, recommendations for im20 provements in the operations or policies of Ex21 changes; and 

22 (4) how many physicians, by area and specialty, 

23 are not taking or accepting new patients enrolled in 

24 Federal Government health care programs, and the 


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1 adequacy of provider networks of Federal Govern2 ment health care programs. 

3 PART III—STATE FLEXIBILITY RELATING TO 

4 EXCHANGES 

5 SEC. 1321. STATE FLEXIBILITY IN OPERATION AND EN6 FORCEMENT OF EXCHANGES AND RELATED 

7 REQUIREMENTS. 

8 (a) ESTABLISHMENT OF STANDARDS.— 

9 (1) IN GENERAL.—The Secretary shall, as soon 

10 as practicable after the date of enactment of this 

11 Act, issue regulations setting standards for meeting 

12 the requirements under this title, and the amend13 ments made by this title, with respect to— 

14 (A) the establishment and operation of Ex15 changes (including SHOP Exchanges); 

16 (B) the offering of qualified health plans 

17 through such Exchanges; 

18 (C) the establishment of the reinsurance 

19 and risk adjustment programs under part V; 

20 and 

21 (D) such other requirements as the Sec22 retary determines appropriate. 

23 The preceding sentence shall not apply to standards 

24 for requirements under subtitles A and C (and the 

25 amendments made by such subtitles) for which the 


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1 Secretary issues regulations under the Public Health 

2 Service Act. 

3 (2) CONSULTATION.—In issuing the regulations 

4 under paragraph (1), the Secretary shall consult 

5 with the National Association of Insurance Commis6 sioners and its members and with health insurance 

7 issuers, consumer organizations, and such other in8 dividuals as the Secretary selects in a manner de9 signed to ensure balanced representation among in10 terested parties. 

11 (b) STATE ACTION.—Each State that elects, at such 

12 time and in such manner as the Secretary may prescribe, 

13 to apply the requirements described in subsection (a) 

14 shall, not later than January 1, 2014, adopt and have in 

15 effect— 

16 (1) the Federal standards established under 

17 subsection (a); or 

18 (2) a State law or regulation that the Secretary 

19 determines implements the standards within the 

20 State. 

21 (c) FAILURE TO ESTABLISH EXCHANGE OR IMPLE22 MENT REQUIREMENTS.— 

23 (1) IN GENERAL.—If— 

24 (A) a State is not an electing State under 

25 subsection (b); or 


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1 (B) the Secretary determines, on or before 

2 January 1, 2013, that an electing State— 

3 (i) will not have any required Ex4 change operational by January 1, 2014; or 

5 (ii) has not taken the actions the Sec6 retary determines necessary to imple7 ment— 

8 (I) the other requirements set 

9 forth in the standards under sub10 section (a); or 

11 (II) the requirements set forth in 

12 subtitles A and C and the amend13 ments made by such subtitles; 

14 the Secretary shall (directly or through agreement 

15 with a not-for-profit entity) establish and operate 

16 such Exchange within the State and the Secretary 

17 shall take such actions as are necessary to imple18 ment such other requirements. 

19 (2) ENFORCEMENT AUTHORITY.—The provi20 sions of section 2736(b) of the Public Health Serv21 ices Act shall apply to the enforcement under para22 graph (1) of requirements of subsection (a)(1) (with23 out regard to any limitation on the application of 

24 those provisions to group health plans). 


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1 (d) NO INTERFERENCE WITH STATE REGULATORY

2 AUTHORITY.—Nothing in this title shall be construed to 

3 preempt any State law that does not prevent the applica4 tion of the provisions of this title. 

5 (e) PRESUMPTION FOR CERTAIN STATE-OPERATED

6 EXCHANGES.— 

7 (1) IN GENERAL.—In the case of a State oper8 ating an Exchange before January 1, 2010, and 

9 which has insured a percentage of its population not 

10 less than the percentage of the population projected 

11 to be covered nationally after the implementation of 

12 this Act, that seeks to operate an Exchange under 

13 this section, the Secretary shall presume that such 

14 Exchange meets the standards under this section 

15 unless the Secretary determines, after completion of 

16 the process established under paragraph (2), that 

17 the Exchange does not comply with such standards. 

18 (2) PROCESS.—The Secretary shall establish a 

19 process to work with a State described in paragraph 

20 (1) to provide assistance necessary to assist the 

21 State’s Exchange in coming into compliance with the 

22 standards for approval under this section. 


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1 SEC. 1322. FEDERAL PROGRAM TO ASSIST ESTABLISHMENT 

2 AND OPERATION OF NONPROFIT, MEMBER3 RUN HEALTH INSURANCE ISSUERS. 

4 (a) ESTABLISHMENT OF PROGRAM.— 

5 (1) IN GENERAL.—The Secretary shall establish 

6 a program to carry out the purposes of this section 

7 to be known as the Consumer Operated and Ori8 ented Plan (CO-OP) program. 

9 (2) PURPOSE.—It is the purpose of the CO-OP 

10 program to foster the creation of qualified nonprofit 

11 health insurance issuers to offer qualified health 

12 plans in the individual and small group markets in 

13 the States in which the issuers are licensed to offer 

14 such plans. 

15 (b) LOANS AND GRANTS UNDER THE CO-OP PRO16 GRAM.— 

17 (1) IN GENERAL.—The Secretary shall provide 

18 through the CO-OP program for the awarding to 

19 persons applying to become qualified nonprofit 

20 health insurance issuers of— 

21 (A) loans to provide assistance to such per22 son in meeting its start-up costs; and 

23 (B) grants to provide assistance to such 

24 person in meeting any solvency requirements of 

25 States in which the person seeks to be licensed 

26 to issue qualified health plans. 


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1 (2) REQUIREMENTS FOR AWARDING LOANS AND

2 GRANTS.— 

3 (A) IN GENERAL.—In awarding loans and 

4 grants under the CO-OP program, the Sec5 retary shall— 

6 (i) take into account the recommenda7 tions of the advisory board established 

8 under paragraph (3); 

9 (ii) give priority to applicants that will 

10 offer qualified health plans on a Statewide 

11 basis, will utilize integrated care models, 

12 and have significant private support; and 

13 (iii) ensure that there is sufficient 

14 funding to establish at least 1 qualified 

15 nonprofit health insurance issuer in each 

16 State, except that nothing in this clause 

17 shall prohibit the Secretary from funding 

18 the establishment of multiple qualified 

19 nonprofit health insurance issuers in any 

20 State if the funding is sufficient to do so. 

21 (B) STATES WITHOUT ISSUERS IN PRO22 GRAM.—If no health insurance issuer applies to 

23 be a qualified nonprofit health insurance issuer 

24 within a State, the Secretary may use amounts 

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1 ing of grants to encourage the establishment of 

2 a qualified nonprofit health insurance issuer 

3 within the State or the expansion of a qualified 

4 nonprofit health insurance issuer from another 

5 State to the State. 

6 (C) AGREEMENT.— 

7 (i) IN GENERAL.—The Secretary shall 

8 require any person receiving a loan or 

9 grant under the CO-OP program to enter 

10 into an agreement with the Secretary 

11 which requires such person to meet (and to 

12 continue to meet)— 

13 (I) any requirement under this 

14 section for such person to be treated 

15 as a qualified nonprofit health insur16 ance issuer; and 

17 (II) any requirements contained 

18 in the agreement for such person to 

19 receive such loan or grant. 

20 (ii) RESTRICTIONS ON USE OF FED21 ERAL FUNDS.—The agreement shall in22 clude a requirement that no portion of the 

23 funds made available by any loan or grant 

24 under this section may be used— 


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1 (I) for carrying on propaganda, 

2 or otherwise attempting, to influence 

3 legislation; or 

4 (II) for marketing. 

5 Nothing in this clause shall be construed 

6 to allow a person to take any action pro7 hibited by section 501(c)(29) of the Inter8 nal Revenue Code of 1986. 

9 (iii) FAILURE TO MEET REQUIRE10 MENTS.—If the Secretary determines that 

11 a person has failed to meet any require12 ment described in clause (i) or (ii) and has 

13 failed to correct such failure within a rea14 sonable period of time of when the person 

15 first knows (or reasonably should have 

16 known) of such failure, such person shall 

17 repay to the Secretary an amount equal to 

18 the sum of— 

19 (I) 110 percent of the aggregate 

20 amount of loans and grants received 

21 under this section; plus 

22 (II) interest on the aggregate 

23 amount of loans and grants received 

24 under this section for the period the 

25 loans or grants were outstanding. 


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1 The Secretary shall notify the Secretary of 

2 the Treasury of any determination under 

3 this section of a failure that results in the 

4 termination of an issuer’s tax-exempt sta5 tus under section 501(c)(29) of such Code. 

6 (D) TIME FOR AWARDING LOANS AND

7 GRANTS.—The Secretary shall not later than 

8 July 1, 2013, award the loans and grants under 

9 the CO-OP program and begin the distribution 

10 of amounts awarded under such loans and 

11 grants. 

12 (3) ADVISORY BOARD.— 

13 (A) IN GENERAL.—The advisory board 

14 under this paragraph shall consist of 15 mem15 bers appointed by the Comptroller General of 

16 the United States from among individuals with 

17 qualifications described in section 1805(c)(2) of 

18 the Social Security Act. 

19 (B) RULES RELATING TO APPOINT20 MENTS.— 

21 (i) STANDARDS.—Any individual ap22 pointed under subparagraph (A) shall meet 

23 ethics and conflict of interest standards 

24 protecting against insurance industry in25 volvement and interference. 


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1 (ii) ORIGINAL APPOINTMENTS.—The 

2 original appointment of board members 

3 under subparagraph (A)(ii) shall be made 

4 no later than 3 months after the date of 

5 enactment of this Act. 

6 (C) VACANCY.—Any vacancy on the advi7 sory board shall be filled in the same manner 

8 as the original appointment. 

9 (D) PAY AND REIMBURSEMENT.— 

10 (i) NO COMPENSATION FOR MEMBERS

11 OF ADVISORY BOARD.—Except as provided 

12 in clause (ii), a member of the advisory 

13 board may not receive pay, allowances, or 

14 benefits by reason of their service on the 

15 board. 

16 (ii) TRAVEL EXPENSES.—Each mem17 ber shall receive travel expenses, including 

18 per diem in lieu of subsistence under sub19 chapter I of chapter 57 of title 5, United 

20 States Code. 

21 (E) APPLICATION OF FACA.—The Federal 

22 Advisory Committee Act (5 U.S.C. App.) shall 

23 apply to the advisory board, except that section 

24 14 of such Act shall not apply. 


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1 (F) TERMINATION.—The advisory board 

2 shall terminate on the earlier of the date that 

3 it completes its duties under this section or De4 cember 31, 2015. 

5 (c) QUALIFIED NONPROFIT HEALTH INSURANCE

6 ISSUER.—For purposes of this section— 

7 (1) IN GENERAL.—The term ‘‘qualified non8 profit health insurance issuer’’ means a health insur9 ance issuer that is an organization— 

10 (A) that is organized under State law as a 

11 nonprofit, member corporation; 

12 (B) substantially all of the activities of 

13 which consist of the issuance of qualified health 

14 plans in the individual and small group markets 

15 in each State in which it is licensed to issue 

16 such plans; and 

17 (C) that meets the other requirements of 

18 this subsection. 

19 (2) CERTAIN ORGANIZATIONS PROHIBITED.— 

20 An organization shall not be treated as a qualified 

21 nonprofit health insurance issuer if— 

22 (A) the organization or a related entity (or 

23 any predecessor of either) was a health insur24 ance issuer on July 16, 2009; or 


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1 (B) the organization is sponsored by a 

2 State or local government, any political subdivi3 sion thereof, or any instrumentality of such 

4 government or political subdivision. 

5 (3) GOVERNANCE REQUIREMENTS.—An organi6 zation shall not be treated as a qualified nonprofit 

7 health insurance issuer unless— 

8 (A) the governance of the organization is 

9 subject to a majority vote of its members; 

10 (B) its governing documents incorporate 

11 ethics and conflict of interest standards pro12 tecting against insurance industry involvement 

13 and interference; and 

14 (C) as provided in regulations promulgated 

15 by the Secretary, the organization is required to 

16 operate with a strong consumer focus, including 

17 timeliness, responsiveness, and accountability to 

18 members. 

19 (4) PROFITS INURE TO BENEFIT OF MEM20 BERS.—An organization shall not be treated as a 

21 qualified nonprofit health insurance issuer unless 

22 any profits made by the organization are required to 

23 be used to lower premiums, to improve benefits, or 

24 for other programs intended to improve the quality 

25 of health care delivered to its members. 


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1 (5) COMPLIANCE WITH STATE INSURANCE

2 LAWS.—An organization shall not be treated as a 

3 qualified nonprofit health insurance issuer unless the 

4 organization meets all the requirements that other 

5 issuers of qualified health plans are required to meet 

6 in any State where the issuer offers a qualified 

7 health plan, including solvency and licensure require8 ments, rules on payments to providers, and compli9 ance with network adequacy rules, rate and form fil10 ing rules, any applicable State premium assessments 

11 and any other State law described in section 

12 1324(b). 

13 (6) COORDINATION WITH STATE INSURANCE

14 REFORMS.—An organization shall not be treated as 

15 a qualified nonprofit health insurance issuer unless 

16 the organization does not offer a health plan in a 

17 State until that State has in effect (or the Secretary 

18 has implemented for the State) the market reforms 

19 required by part A of title XXVII of the Public 

20 Health Service Act (as amended by subtitles A and 

21 C of this Act). 

22 (d) ESTABLISHMENT OF PRIVATE PURCHASING

23 COUNCIL.— 

24 (1) IN GENERAL.—Qualified nonprofit health 

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1 gram under this section may establish a private pur2 chasing council to enter into collective purchasing 

3 arrangements for items and services that increase 

4 administrative and other cost efficiencies, including 

5 claims administration, administrative services, health 

6 information technology, and actuarial services. 

7 (2) COUNCIL MAY NOT SET PAYMENT RATES.— 

8 The private purchasing council established under 

9 paragraph (1) shall not set payment rates for health 

10 care facilities or providers participating in health in11 surance coverage provided by qualified nonprofit 

12 health insurance issuers. 

13 (3) CONTINUED APPLICATION OF ANTITRUST

14 LAWS.— 

15 (A) IN GENERAL.—Nothing in this section 

16 shall be construed to limit the application of the 

17 antitrust laws to any private purchasing council 

18 (whether or not established under this sub19 section) or to any qualified nonprofit health in20 surance issuer participating in such a council. 

21 (B) ANTITRUST LAWS.—For purposes of 

22 this subparagraph, the term ‘‘antitrust laws’’ 

23 has the meaning given the term in subsection 

24 (a) of the first section of the Clayton Act (15 

25 U.S.C. 12(a)). Such term also includes section 


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1 5 of the Federal Trade Commission Act (15 

2 U.S.C. 45) to the extent that such section 5 ap3 plies to unfair methods of competition. 

4 (e) LIMITATION ON PARTICIPATION.—No representa5 tive of any Federal, State, or local government (or of any 

6 political subdivision or instrumentality thereof), and no 

7 representative of a person described in subsection 

8 (c)(2)(A), may serve on the board of directors of a quali9 fied nonprofit health insurance issuer or with a private 

10 purchasing council established under subsection (d). 

11 (f) LIMITATIONS ON SECRETARY.— 

12 (1) IN GENERAL.—The Secretary shall not— 

13 (A) participate in any negotiations between 

14 1 or more qualified nonprofit health insurance 

15 issuers (or a private purchasing council estab16 lished under subsection (d)) and any health 

17 care facilities or providers, including any drug 

18 manufacturer, pharmacy, or hospital; and 

19 (B) establish or maintain a price structure 

20 for reimbursement of any health benefits cov21 ered by such issuers. 

22 (2) COMPETITION.—Nothing in this section 

23 shall be construed as authorizing the Secretary to 

24 interfere with the competitive nature of providing 


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1 health benefits through qualified nonprofit health in2 surance issuers. 

3 (g) APPROPRIATIONS.—There are hereby appro4 priated, out of any funds in the Treasury not otherwise 

5 appropriated, $6,000,000,000 to carry out this section. 

6 (h) TAX EXEMPTION FOR QUALIFIED NONPROFIT

7 HEALTH INSURANCE ISSUER.— 

8 (1) IN GENERAL.—Section 501(c) of the Inter9 nal Revenue Code of 1986 (relating to list of exempt 

10 organizations) is amended by adding at the end the 

11 following: 

12 ‘‘(29) CO-OP HEALTH INSURANCE ISSUERS.— 

13 ‘‘(A) IN GENERAL.—A qualified nonprofit 

14 health insurance issuer (within the meaning of 

15 section 1322 of the Patient Protection and Af16 fordable Care Act) which has received a loan or 

17 grant under the CO-OP program under such 

18 section, but only with respect to periods for 

19 which the issuer is in compliance with the re20 quirements of such section and any agreement 

21 with respect to the loan or grant. 

22 ‘‘(B) CONDITIONS FOR EXEMPTION.—Sub23 paragraph (A) shall apply to an organization 

24 only if— 


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1 ‘‘(i) the organization has given notice 

2 to the Secretary, in such manner as the 

3 Secretary may by regulations prescribe, 

4 that it is applying for recognition of its 

5 status under this paragraph, 

6 ‘‘(ii) except as provided in section 

7 1322(c)(4) of the Patient Protection and 

8 Affordable Care Act, no part of the net 

9 earnings of which inures to the benefit of 

10 any private shareholder or individual, 

11 ‘‘(iii) no substantial part of the activi12 ties of which is carrying on propaganda, or 

13 otherwise attempting, to influence legisla14 tion, and 

15 ‘‘(iv) the organization does not par16 ticipate in, or intervene in (including the 

17 publishing or distributing of statements), 

18 any political campaign on behalf of (or in 

19 opposition to) any candidate for public of20 fice.’’. 

21 (2) ADDITIONAL REPORTING REQUIREMENT.— 

22 Section 6033 of such Code (relating to returns by 

23 exempt organizations) is amended by redesignating 

24 subsection (m) as subsection (n) and by inserting 

25 after subsection (l) the following: 


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1 ‘‘(m) ADDITIONAL INFORMATION REQUIRED FROM

2 CO-OP INSURERS.—An organization described in section 

3 501(c)(29) shall include on the return required under sub4 section (a) the following information: 

5 ‘‘(1) The amount of the reserves required by 

6 each State in which the organization is licensed to 

7 issue qualified health plans. 

8 ‘‘(2) The amount of reserves on hand.’’. 

9 (3) APPLICATION OF TAX ON EXCESS BENEFIT

10 TRANSACTIONS.—Section 4958(e)(1) of such Code 

11 (defining applicable tax-exempt organization) is 

12 amended by striking ‘‘paragraph (3) or (4)’’ and in13 serting ‘‘paragraph (3), (4), or (29)’’. 

14 (i) GAO STUDY AND REPORT.— 

15 (1) STUDY.—The Comptroller General of the 

16 General Accountability Office shall conduct an ongo17 ing study on competition and market concentration 

18 in the health insurance market in the United States 

19 after the implementation of the reforms in such 

20 market under the provisions of, and the amendments 

21 made by, this Act. Such study shall include an anal22 ysis of new issuers of health insurance in such mar23 ket. 

24 (2) REPORT.—The Comptroller General shall, 

25 not later than December 31 of each even-numbered 


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1 year (beginning with 2014), report to the appro2 priate committees of the Congress the results of the 

3 study conducted under paragraph (1), including any 

4 recommendations for administrative or legislative 

5 changes the Comptroller General determines nec6 essary or appropriate to increase competition in the 

7 health insurance market. 

8 SEC. 1323. COMMUNITY HEALTH INSURANCE OPTION. 

9 (a) VOLUNTARY NATURE.— 

10 (1) NO REQUIREMENT FOR HEALTH CARE PRO11 VIDERS TO PARTICIPATE.—Nothing in this section 

12 shall be construed to require a health care provider 

13 to participate in a community health insurance op14 tion, or to impose any penalty for non-participation. 

15 (2) NO REQUIREMENT FOR INDIVIDUALS TO

16 JOIN.—Nothing in this section shall be construed to 

17 require an individual to participate in a community 

18 health insurance option, or to impose any penalty for 

19 non-participation. 

20 (3) STATE OPT OUT.— 

21 (A) IN GENERAL.—A State may elect to 

22 prohibit Exchanges in such State from offering 

23 a community health insurance option if such 

24 State enacts a law to provide for such prohibi25 tion. 


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1 (B) TERMINATION OF OPT OUT.—A State 

2 may repeal a law described in subparagraph (A) 

3 and provide for the offering of such an option 

4 through the Exchange. 

5 (b) ESTABLISHMENT OF COMMUNITY HEALTH IN6 SURANCE OPTION.— 

7 (1) ESTABLISHMENT.—The Secretary shall es8 tablish a community health insurance option to 

9 offer, through the Exchanges established under this 

10 title (other than Exchanges in States that elect to 

11 opt out as provided for in subsection (a)(3)), health 

12 care coverage that provides value, choice, competi13 tion, and stability of affordable, high quality cov14 erage throughout the United States. 

15 (2) COMMUNITY HEALTH INSURANCE OP16 TION.—In this section, the term ‘‘community health 

17 insurance option’’ means health insurance coverage 

18 that— 

19 (A) except as specifically provided for in 

20 this section, complies with the requirements for 

21 being a qualified health plan; 

22 (B) provides high value for the premium 

23 charged; 


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1 (C) reduces administrative costs and pro2 motes administrative simplification for bene3 ficiaries; 

4 (D) promotes high quality clinical care; 

5 (E) provides high quality customer service 

6 to beneficiaries; 

7 (F) offers a sufficient choice of providers; 

8 and 

9 (G) complies with State laws (if any), ex10 cept as otherwise provided for in this title, re11 lating to the laws described in section 1324(b). 

12 (3) ESSENTIAL HEALTH BENEFITS.— 

13 (A) GENERAL RULE.—Except as provided 

14 in subparagraph (B), a community health in15 surance option offered under this section shall 

16 provide coverage only for the essential health 

17 benefits described in section 1302(b). 

18 (B) STATES MAY OFFER ADDITIONAL BEN19 EFITS.—Nothing in this section shall preclude a 

20 State from requiring that benefits in addition to 

21 the essential health benefits required under sub22 paragraph (A) be provided to enrollees of a 

23 community health insurance option offered in 

24 such State. 

25 (C) CREDITS.— 


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1 (i) IN GENERAL.—An individual en2 rolled in a community health insurance op3 tion under this section shall be eligible for 

4 credits under section 36B of the Internal 

5 Revenue Code of 1986 in the same manner 

6 as an individual who is enrolled in a quali7 fied health plan. 

8 (ii) NO ADDITIONAL FEDERAL

9 COST.—A requirement by a State under 

10 subparagraph (B) that benefits in addition 

11 to the essential health benefits required 

12 under subparagraph (A) be provided to en13 rollees of a community health insurance 

14 option shall not affect the amount of a pre15 mium tax credit provided under section 

16 36B of the Internal Revenue Code of 1986 

17 with respect to such plan. 

18 (D) STATE MUST ASSUME COST.—A State 

19 shall make payments to or on behalf of an eligi20 ble individual to defray the cost of any addi21 tional benefits described in subparagraph (B). 

22 (E) ENSURING ACCESS TO ALL SERV23 ICES.—Nothing in this Act shall prohibit an in24 dividual enrolled in a community health insur25 ance option from paying out-of-pocket the full 


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1 cost of any item or service not included as an 

2 essential health benefit or otherwise covered as 

3 a benefit by a health plan. Nothing in subpara4 graph (B) shall prohibit any type of medical 

5 provider from accepting an out-of-pocket pay6 ment from an individual enrolled in a commu7 nity health insurance option for a service other8 wise not included as an essential health benefit. 

9 (F) PROTECTING ACCESS TO END OF LIFE

10 CARE.—A community health insurance option 

11 offered under this section shall be prohibited 

12 from limiting access to end of life care. 

13 (4) COST SHARING.—A community health in14 surance option shall offer coverage at each of the 

15 levels of coverage described in section 1302(d). 

16 (5) PREMIUMS.— 

17 (A) PREMIUMS SUFFICIENT TO COVER

18 COSTS.—The Secretary shall establish geo19 graphically adjusted premium rates in an 

20 amount sufficient to cover expected costs (in21 cluding claims and administrative costs) using 

22 methods in general use by qualified health 

23 plans. 

24 (B) APPLICABLE RULES.—The provisions 

25 of title XXVII of the Public Health Service Act 


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1 relating to premiums shall apply to community 

2 health insurance options under this section, in3 cluding modified community rating provisions 

4 under section 2701 of such Act. 

5 (C) COLLECTION OF DATA.—The Sec6 retary shall collect data as necessary to set pre7 mium rates under subparagraph (A). 

8 (D) NATIONAL POOLING.—Notwith9 standing any other provision of law, the Sec10 retary may treat all enrollees in community 

11 health insurance options as members of a single 

12 pool. 

13 (E) CONTINGENCY MARGIN.—In estab14 lishing premium rates under subparagraph (A), 

15 the Secretary shall include an appropriate 

16 amount for a contingency margin. 

17 (6) REIMBURSEMENT RATES.— 

18 (A) NEGOTIATED RATES.—The Secretary 

19 shall negotiate rates for the reimbursement of 

20 health care providers for benefits covered under 

21 a community health insurance option. 

22 (B) LIMITATION.—The rates described in 

23 subparagraph (A) shall not be higher, in aggre24 gate, than the average reimbursement rates 


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1 paid by health insurance issuers offering quali2 fied health plans through the Exchange. 

3 (C) INNOVATION.—Subject to the limits 

4 contained in subparagraph (A), a State Advi5 sory Council established or designated under 

6 subsection (d) may develop or encourage the 

7 use of innovative payment policies that promote 

8 quality, efficiency and savings to consumers. 

9 (7) SOLVENCY AND CONSUMER PROTECTION.— 

10 (A) SOLVENCY.—The Secretary shall es11 tablish a Federal solvency standard to be ap12 plied with respect to a community health insur13 ance option. A community health insurance op14 tion shall also be subject to the solvency stand15 ard of each State in which such community 

16 health insurance option is offered. 

17 (B) MINIMUM REQUIRED.—In establishing 

18 the standard described under subparagraph 

19 (A), the Secretary shall require a reserve fund 

20 that shall be equal to at least the dollar value 

21 of the incurred but not reported claims of a 

22 community health insurance option. 

23 (C) CONSUMER PROTECTIONS.—The con24 sumer protection laws of a State shall apply to 

25 a community health insurance option. 


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1 (8) REQUIREMENTS ESTABLISHED IN PARTNER2 SHIP WITH INSURANCE COMMISSIONERS.— 

3 (A) IN GENERAL.—The Secretary, in col4 laboration with the National Association of In5 surance Commissioners (in this paragraph re6 ferred to as the ‘‘NAIC’’), may promulgate reg7 ulations to establish additional requirements for 

8 a community health insurance option. 

9 (B) APPLICABILITY.—Any requirement 

10 promulgated under subparagraph (A) shall be 

11 applicable to such option beginning 90 days 

12 after the date on which the regulation involved 

13 becomes final. 

14 (c) START-UP FUND.— 

15 (1) ESTABLISHMENT OF FUND.— 

16 (A) IN GENERAL.—There is established in 

17 the Treasury of the United States a trust fund 

18 to be known as the ‘‘Health Benefit Plan Start19 Up Fund’’ (referred to in this section as the 

20 ‘‘Start-Up Fund’’), that shall consist of such 

21 amounts as may be appropriated or credited to 

22 the Start-Up Fund as provided for in this sub23 section to provide loans for the initial oper24 ations of a community health insurance option. 


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1 Such amounts shall remain available until ex2 pended. 

3 (B) FUNDING.—There is hereby appro4 priated to the Start-Up Fund, out of any mon5 eys in the Treasury not otherwise appropriated 

6 an amount requested by the Secretary of 

7 Health and Human Services as necessary to— 

8 (i) pay the start-up costs associated 

9 with the initial operations of a community 

10 health insurance option; and 

11 (ii) pay the costs of making payments 

12 on claims submitted during the period that 

13 is not more than 90 days from the date on 

14 which such option is offered. 

15 (2) USE OF START-UP FUND.—The Secretary 

16 shall use amounts contained in the Start-Up Fund 

17 to make payments (subject to the repayment re18 quirements in paragraph (4)) for the purposes de19 scribed in paragraph (1)(B). 

20 (3) PASS THROUGH OF REBATES.—The Sec21 retary may establish procedures for reducing the 

22 amount of payments to a contracting administrator 

23 to take into account any rebates or price conces24 sions. 

25 (4) REPAYMENT.— 


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1 (A) IN GENERAL.—A community health in2 surance option shall be required to repay the 

3 Secretary of the Treasury (on such terms as the 

4 Secretary may require) for any payments made 

5 under paragraph (1)(B) by the date that is not 

6 later than 9 years after the date on which the 

7 payment is made. The Secretary may require 

8 the payment of interest with respect to such re9 payments at rates that do not exceed the mar10 ket interest rate (as determined by the Sec11 retary). 

12 (B) SANCTIONS IN CASE OF FOR-PROFIT

13 CONVERSION.—In any case in which the Sec14 retary enters into a contract with a qualified 

15 entity for the offering of a community health 

16 insurance option and such entity is determined 

17 to be a for-profit entity by the Secretary, such 

18 entity shall be— 

19 (i) immediately liable to the Secretary 

20 for any payments received by such entity 

21 from the Start-Up Fund; and 

22 (ii) permanently ineligible to offer a 

23 qualified health plan. 

24 (d) STATE ADVISORY COUNCIL.— 


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1 (1) ESTABLISHMENT.—A State (other than a 

2 State that elects to opt out as provided for in sub3 section (a)(3)) shall establish or designate a public 

4 or non-profit private entity to serve as the State Ad5 visory Council to provide recommendations to the 

6 Secretary on the operations and policies of a com7 munity health insurance option in the State. Such 

8 Council shall provide recommendations on at least 

9 the following: 

10 (A) policies and procedures to integrate 

11 quality improvement and cost containment 

12 mechanisms into the health care delivery sys13 tem; 

14 (B) mechanisms to facilitate public aware15 ness of the availability of a community health 

16 insurance option; and 

17 (C) alternative payment structures under a 

18 community health insurance option for health 

19 care providers that encourage quality improve20 ment and cost control. 

21 (2) MEMBERS.—The members of the State Ad22 visory Council shall be representatives of the public 

23 and shall include health care consumers and pro24 viders. 


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1 (3) APPLICABILITY OF RECOMMENDATIONS.— 

2 The Secretary may apply the recommendations of a 

3 State Advisory Council to a community health insur4 ance option in that State, in any other State, or in 

5 all States. 

6 (e) AUTHORITY TO CONTRACT; TERMS OF CON7 TRACT.— 

8 (1) AUTHORITY.— 

9 (A) IN GENERAL.—The Secretary may 

10 enter into a contract or contracts with one or 

11 more qualified entities for the purpose of per12 forming administrative functions (including 

13 functions described in subsection (a)(4) of sec14 tion 1874A of the Social Security Act) with re15 spect to a community health insurance option in 

16 the same manner as the Secretary may enter 

17 into contracts under subsection (a)(1) of such 

18 section. The Secretary shall have the same au19 thority with respect to a community health in20 surance option under this section as the Sec21 retary has under subsections (a)(1) and (b) of 

22 section 1874A of the Social Security Act with 

23 respect to title XVIII of such Act. 

24 (B) REQUIREMENTS APPLY.—If the Sec25 retary enters into a contract with a qualified 


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1 entity to offer a community health insurance 

2 option, under such contract such entity— 

3 (i) shall meet the criteria established 

4 under paragraph (2); and 

5 (ii) shall receive an administrative fee 

6 under paragraph (7). 

7 (C) LIMITATION.—Contracts under this 

8 subsection shall not involve the transfer of in9 surance risk to the contracting administrator. 

10 (D) REFERENCE.—An entity with which 

11 the Secretary has entered into a contract under 

12 this paragraph shall be referred to as a ‘‘con13 tracting administrator’’. 

14 (2) QUALIFIED ENTITY.—To be qualified to be 

15 selected by the Secretary to offer a community 

16 health insurance option, an entity shall— 

17 (A) meet the criteria established under sec18 tion 1874A(a)(2) of the Social Security Act; 

19 (B) be a nonprofit entity for purposes of 

20 offering such option; 

21 (C) meet the solvency standards applicable 

22 under subsection (b)(7); 

23 (D) be eligible to offer health insurance or 

24 health benefits coverage; 


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1 (E) meet quality standards specified by the 

2 Secretary; 

3 (F) have in place effective procedures to 

4 control fraud, abuse, and waste; and 

5 (G) meet such other requirements as the 

6 Secretary may impose. 

7 Procedures described under subparagraph (F) shall 

8 include the implementation of procedures to use ben9 eficiary identifiers to identify individuals entitled to 

10 benefits so that such an individual’s social security 

11 account number is not used, and shall also include 

12 procedures for the use of technology (including 

13 front-end, prepayment intelligent data-matching 

14 technology similar to that used by hedge funds, in15 vestment funds, and banks) to provide real-time 

16 data analysis of claims for payment under this title 

17 to identify and investigate unusual billing or order 

18 practices under this title that could indicate fraud or 

19 abuse. 

20 (3) TERM.—A contract provided for under 

21 paragraph (1) shall be for a term of at least 5 years 

22 but not more than 10 years, as determined by the 

23 Secretary. At the end of each such term, the Sec24 retary shall conduct a competitive bidding process 

25 for the purposes of renewing existing contracts or 


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1 selecting new qualified entities with which to enter 

2 into contracts under such paragraph. 

3 (4) LIMITATION.—A contract may not be re4 newed under this subsection unless the Secretary de5 termines that the contracting administrator has met 

6 performance requirements established by the Sec7 retary in the areas described in paragraph (7)(B). 

8 (5) AUDITS.—The Inspector General shall con9 duct periodic audits with respect to contracting ad10 ministrators under this subsection to ensure that the 

11 administrator involved is in compliance with this sec12 tion. 

13 (6) REVOCATION.—A contract awarded under 

14 this subsection shall be revoked by the Secretary, 

15 upon the recommendation of the Inspector General, 

16 only after notice to the contracting administrator in17 volved and an opportunity for a hearing. The Sec18 retary may revoke such contract if the Secretary de19 termines that such administrator has engaged in 

20 fraud, deception, waste, abuse of power, negligence, 

21 mismanagement of taxpayer dollars, or gross mis22 management. An entity that has had a contract re23 voked under this paragraph shall not be qualified to 

24 enter into a subsequent contract under this sub25 section. 


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1 (7) FEE FOR ADMINISTRATION.— 

2 (A) IN GENERAL.—The Secretary shall pay 

3 the contracting administrator a fee for the 

4 management, administration, and delivery of 

5 the benefits under this section. 

6 (B) REQUIREMENT FOR HIGH QUALITY

7 ADMINISTRATION.—The Secretary may increase 

8 the fee described in subparagraph (A) by not 

9 more than 10 percent, or reduce the fee de10 scribed in subparagraph (A) by not more than 

11 50 percent, based on the extent to which the 

12 contracting administrator, in the determination 

13 of the Secretary, meets performance require14 ments established by the Secretary, in at least 

15 the following areas: 

16 (i) Maintaining low premium costs 

17 and low cost sharing requirements, pro18 vided that such requirements are con19 sistent with section 1302. 

20 (ii) Reducing administrative costs and 

21 promoting administrative simplification for 

22 beneficiaries. 

23 (iii) Promoting high quality clinical 

24 care. 


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1 (iv) Providing high quality customer 

2 service to beneficiaries. 

3 (C) NON-RENEWAL.—The Secretary may 

4 not renew a contract to offer a community 

5 health insurance option under this section with 

6 any contracting entity that has been assessed 

7 more than one reduction under subparagraph 

8 (B) during the contract period. 

9 (8) LIMITATION.—Notwithstanding the terms 

10 of a contract under this subsection, the Secretary 

11 shall negotiate the reimbursement rates for purposes 

12 of subsection (b)(6). 

13 (f) REPORT BY HHS AND INSOLVENCY WARN14 INGS.— 

15 (1) IN GENERAL.—On an annual basis, the Sec16 retary shall conduct a study on the solvency of a 

17 community health insurance option and submit to 

18 Congress a report describing the results of such 

19 study. 

20 (2) RESULT.—If, in any year, the result of the 

21 study under paragraph (1) is that a community 

22 health insurance option is insolvent, such result shall 

23 be treated as a community health insurance option 

24 solvency warning. 

25 (3) SUBMISSION OF PLAN AND PROCEDURE.— 


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1 (A) IN GENERAL.—If there is a community 

2 health insurance option solvency warning under 

3 paragraph (2) made in a year, the President 

4 shall submit to Congress, within the 15-day pe5 riod beginning on the date of the budget sub6 mission to Congress under section 1105(a) of 

7 title 31, United States Code, for the succeeding 

8 year, proposed legislation to respond to such 

9 warning. 

10 (B) PROCEDURE.—In the case of a legisla11 tive proposal submitted by the President pursu12 ant to subparagraph (A), such proposal shall be 

13 considered by Congress using the same proce14 dures described under sections 803 and 804 of 

15 the Medicare Prescription Drug, Improvement, 

16 and Modernization Act of 2003 that shall be 

17 used for a medicare funding warning. 

18 (g) MARKETING PARITY.—In a facility controlled by 

19 the Federal Government, or by a State, where marketing 

20 or promotional materials related to a community health 

21 insurance option are made available to the public, making 

22 available marketing or promotional materials relating to 

23 private health insurance plans shall not be prohibited. 

24 Such materials include informational pamphlets, guideVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00199 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 books, enrollment forms, or other materials determined 

2 reasonable for display. 

3 (h) AUTHORIZATION OF APPROPRIATIONS.—There is 

4 authorized to be appropriated such sums as may be nec5 essary to carry out this section. 

6 SEC. 1324. LEVEL PLAYING FIELD. 

7 (a) IN GENERAL.—Notwithstanding any other provi8 sion of law, any health insurance coverage offered by a 

9 private health insurance issuer shall not be subject to any 

10 Federal or State law described in subsection (b) if a quali11 fied health plan offered under the Consumer Operated and 

12 Oriented Plan program under section 1322, a community 

13 health insurance option under section 1323, or a nation14 wide qualified health plan under section 1333(b), is not 

15 subject to such law. 

16 (b) LAWS DESCRIBED.—The Federal and State laws 

17 described in this subsection are those Federal and State 

18 laws relating to— 

19 (1) guaranteed renewal; 

20 (2) rating; 

21 (3) preexisting conditions; 

22 (4) non-discrimination; 

23 (5) quality improvement and reporting; 

24 (6) fraud and abuse; 

25 (7) solvency and financial requirements; 


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1 (8) market conduct; 

2 (9) prompt payment; 

3 (10) appeals and grievances; 

4 (11) privacy and confidentiality; 

5 (12) licensure; and 

6 (13) benefit plan material or information. 

7 PART IV—STATE FLEXIBILITY TO ESTABLISH 

8 ALTERNATIVE PROGRAMS 

9 SEC. 1331. STATE FLEXIBILITY TO ESTABLISH BASIC 

10 HEALTH PROGRAMS FOR LOW-INCOME INDI11 VIDUALS NOT ELIGIBLE FOR MEDICAID. 

12 (a) ESTABLISHMENT OF PROGRAM.— 

13 (1) IN GENERAL.—The Secretary shall establish 

14 a basic health program meeting the requirements of 

15 this section under which a State may enter into con16 tracts to offer 1 or more standard health plans pro17 viding at least the essential health benefits described 

18 in section 1302(b) to eligible individuals in lieu of 

19 offering such individuals coverage through an Ex20 change. 

21 (2) CERTIFICATIONS AS TO BENEFIT COVERAGE

22 AND COSTS.—Such program shall provide that a 

23 State may not establish a basic health program 

24 under this section unless the State establishes to the 


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1 satisfaction of the Secretary, and the Secretary cer2 tifies, that— 

3 (A) in the case of an eligible individual en4 rolled in a standard health plan offered through 

5 the program, the State provides— 

6 (i) that the amount of the monthly 

7 premium an eligible individual is required 

8 to pay for coverage under the standard 

9 health plan for the individual and the indi10 vidual’s dependents does not exceed the 

11 amount of the monthly premium that the 

12 eligible individual would have been required 

13 to pay (in the rating area in which the in14 dividual resides) if the individual had en15 rolled in the applicable second lowest cost 

16 silver plan (as defined in section 

17 36B(b)(3)(B) of the Internal Revenue 

18 Code of 1986) offered to the individual 

19 through an Exchange; and 

20 (ii) that the cost-sharing an eligible 

21 individual is required to pay under the 

22 standard health plan does not exceed— 

23 (I) the cost-sharing required 

24 under a platinum plan in the case of 

25 an eligible individual with household 


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1 income not in excess of 150 percent of 

2 the poverty line for the size of the 

3 family involved; and 

4 (II) the cost-sharing required 

5 under a gold plan in the case of an el6 igible individual not described in sub7 clause (I); and 

8 (B) the benefits provided under the stand9 ard health plans offered through the program 

10 cover at least the essential health benefits de11 scribed in section 1302(b). 

12 For purposes of subparagraph (A)(i), the amount of 

13 the monthly premium an individual is required to 

14 pay under either the standard health plan or the ap15 plicable second lowest cost silver plan shall be deter16 mined after reduction for any premium tax credits 

17 and cost-sharing reductions allowable with respect to 

18 either plan. 

19 (b) STANDARD HEALTH PLAN.—In this section, the 

20 term ‘‘standard heath plan’’ means a health benefits plan 

21 that the State contracts with under this section— 

22 (1) under which the only individuals eligible to 

23 enroll are eligible individuals; 

24 (2) that provides at least the essential health 

25 benefits described in section 1302(b); and 


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1 (3) in the case of a plan that provides health 

2 insurance coverage offered by a health insurance 

3 issuer, that has a medical loss ratio of at least 85 

4 percent. 

5 (c) CONTRACTING PROCESS.— 

6 (1) IN GENERAL.—A State basic health pro7 gram shall establish a competitive process for enter8 ing into contracts with standard health plans under 

9 subsection (a), including negotiation of premiums 

10 and cost-sharing and negotiation of benefits in addi11 tion to the essential health benefits described in sec12 tion 1302(b). 

13 (2) SPECIFIC ITEMS TO BE CONSIDERED.—A 

14 State shall, as part of its competitive process under 

15 paragraph (1), include at least the following: 

16 (A) INNOVATION.—Negotiation with 

17 offerors of a standard health plan for the inclu18 sion of innovative features in the plan, includ19 ing— 

20 (i) care coordination and care man21 agement for enrollees, especially for those 

22 with chronic health conditions; 

23 (ii) incentives for use of preventive 

24 services; and 


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1 (iii) the establishment of relationships 

2 between providers and patients that maxi3 mize patient involvement in health care de4 cision-making, including providing incen5 tives for appropriate utilization under the 

6 plan. 

7 (B) HEALTH AND RESOURCE DIF8 FERENCES.—Consideration of, and the making 

9 of suitable allowances for, differences in health 

10 care needs of enrollees and differences in local 

11 availability of, and access to, health care pro12 viders. Nothing in this subparagraph shall be 

13 construed as allowing discrimination on the 

14 basis of pre-existing conditions or other health 

15 status-related factors. 

16 (C) MANAGED CARE.—Contracting with 

17 managed care systems, or with systems that 

18 offer as many of the attributes of managed care 

19 as are feasible in the local health care market. 

20 (D) PERFORMANCE MEASURES.—Estab21 lishing specific performance measures and 

22 standards for issuers of standard health plans 

23 that focus on quality of care and improved 

24 health outcomes, requiring such plans to report 

25 to the State with respect to the measures and 


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1 standards, and making the performance and 

2 quality information available to enrollees in a 

3 useful form. 

4 (3) ENHANCED AVAILABILITY.— 

5 (A) MULTIPLE PLANS.—A State shall, to 

6 the maximum extent feasible, seek to make 

7 multiple standard health plans available to eligi8 ble individuals within a State to ensure individ9 uals have a choice of such plans. 

10 (B) REGIONAL COMPACTS.—A State may 

11 negotiate a regional compact with other States 

12 to include coverage of eligible individuals in all 

13 such States in agreements with issuers of 

14 standard health plans. 

15 (4) COORDINATION WITH OTHER STATE PRO16 GRAMS.—A State shall seek to coordinate the admin17 istration of, and provision of benefits under, its pro18 gram under this section with the State medicaid pro19 gram under title XIX of the Social Security Act, the 

20 State child health plan under title XXI of such Act, 

21 and other State-administered health programs to 

22 maximize the efficiency of such programs and to im23 prove the continuity of care. 

24 (d) TRANSFER OF FUNDS TO STATES.— 


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1 (1) IN GENERAL.—If the Secretary determines 

2 that a State electing the application of this section 

3 meets the requirements of the program established 

4 under subsection (a), the Secretary shall transfer to 

5 the State for each fiscal year for which 1 or more 

6 standard health plans are operating within the State 

7 the amount determined under paragraph (3). 

8 (2) USE OF FUNDS.—A State shall establish a 

9 trust for the deposit of the amounts received under 

10 paragraph (1) and amounts in the trust fund shall 

11 only be used to reduce the premiums and cost-shar12 ing of, or to provide additional benefits for, eligible 

13 individuals enrolled in standard health plans within 

14 the State. Amounts in the trust fund, and expendi15 tures of such amounts, shall not be included in de16 termining the amount of any non-Federal funds for 

17 purposes of meeting any matching or expenditure re18 quirement of any federally-funded program. 

19 (3) AMOUNT OF PAYMENT.— 

20 (A) SECRETARIAL DETERMINATION.— 

21 (i) IN GENERAL.—The amount deter22 mined under this paragraph for any fiscal 

23 year is the amount the Secretary deter24 mines is equal to 85 percent of the pre25 mium tax credits under section 36B of the 


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1 Internal Revenue Code of 1986, and the 

2 cost-sharing reductions under section 

3 1402, that would have been provided for 

4 the fiscal year to eligible individuals en5 rolled in standard health plans in the State 

6 if such eligible individuals were allowed to 

7 enroll in qualified health plans through an 

8 Exchange established under this subtitle. 

9 (ii) SPECIFIC REQUIREMENTS.—The 

10 Secretary shall make the determination 

11 under clause (i) on a per enrollee basis and 

12 shall take into account all relevant factors 

13 necessary to determine the value of the 

14 premium tax credits and cost-sharing re15 ductions that would have been provided to 

16 eligible individuals described in clause (i), 

17 including the age and income of the en18 rollee, whether the enrollment is for self19 only or family coverage, geographic dif20 ferences in average spending for health 

21 care across rating areas, the health status 

22 of the enrollee for purposes of determining 

23 risk adjustment payments and reinsurance 

24 payments that would have been made if 

25 the enrollee had enrolled in a qualified 


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1 health plan through an Exchange, and 

2 whether any reconciliation of the credit or 

3 cost-sharing reductions would have oc4 curred if the enrollee had been so enrolled. 

5 This determination shall take into consid6 eration the experience of other States with 

7 respect to participation in an Exchange 

8 and such credits and reductions provided 

9 to residents of the other States, with a spe10 cial focus on enrollees with income below 

11 200 percent of poverty. 

12 (iii) CERTIFICATION.—The Chief Ac13 tuary of the Centers for Medicare & Med14 icaid Services, in consultation with the Of15 fice of Tax Analysis of the Department of 

16 the Treasury, shall certify whether the 

17 methodology used to make determinations 

18 under this subparagraph, and such deter19 minations, meet the requirements of clause 

20 (ii). Such certifications shall be based on 

21 sufficient data from the State and from 

22 comparable States about their experience 

23 with programs created by this Act. 

24 (B) CORRECTIONS.—The Secretary shall 

25 adjust the payment for any fiscal year to reflect 


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1 any error in the determinations under subpara2 graph (A) for any preceding fiscal year. 

3 (4) APPLICATION OF SPECIAL RULES.—The 

4 provisions of section 1303 shall apply to a State 

5 basic health program, and to standard health plans 

6 offered through such program, in the same manner 

7 as such rules apply to qualified health plans. 

8 (e) ELIGIBLE INDIVIDUAL.— 

9 (1) IN GENERAL.—In this section, the term ‘‘el10 igible individual’’ means, with respect to any State, 

11 an individual— 

12 (A) who a resident of the State who is not 

13 eligible to enroll in the State’s medicaid pro14 gram under title XIX of the Social Security Act 

15 for benefits that at a minimum consist of the 

16 essential health benefits described in section 

17 1302(b); 

18 (B) whose household income exceeds 133 

19 percent but does not exceed 200 percent of the 

20 poverty line for the size of the family involved; 

21 (C) who is not eligible for minimum essen22 tial coverage (as defined in section 5000A(f) of 

23 the Internal Revenue Code of 1986) or is eligi24 ble for an employer-sponsored plan that is not 


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1 affordable coverage (as determined under sec2 tion 5000A(e)(2) of such Code); and 

3 (D) who has not attained age 65 as of the 

4 beginning of the plan year. 

5 Such term shall not include any individual who is 

6 not a qualified individual under section 1312 who is 

7 eligible to be covered by a qualified health plan of8 fered through an Exchange. 

9 (2) ELIGIBLE INDIVIDUALS MAY NOT USE EX10 CHANGE.—An eligible individual shall not be treated 

11 as a qualified individual under section 1312 eligible 

12 for enrollment in a qualified health plan offered 

13 through an Exchange established under section 

14 1311. 

15 (f) SECRETARIAL OVERSIGHT.—The Secretary shall 

16 each year conduct a review of each State program to en17 sure compliance with the requirements of this section, in18 cluding ensuring that the State program meets— 

19 (1) eligibility verification requirements for par20 ticipation in the program; 

21 (2) the requirements for use of Federal funds 

22 received by the program; and 

23 (3) the quality and performance standards 

24 under this section. 


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1 (g) STANDARD HEALTH PLAN OFFERORS.—A State 

2 may provide that persons eligible to offer standard health 

3 plans under a basic health program established under this 

4 section may include a licensed health maintenance organi5 zation, a licensed health insurance insurer, or a network 

6 of health care providers established to offer services under 

7 the program. 

8 (h) DEFINITIONS.—Any term used in this section 

9 which is also used in section 36B of the Internal Revenue 

10 Code of 1986 shall have the meaning given such term by 

11 such section. 

12 SEC. 1332. WAIVER FOR STATE INNOVATION. 

13 (a) APPLICATION.— 

14 (1) IN GENERAL.—A State may apply to the 

15 Secretary for the waiver of all or any requirements 

16 described in paragraph (2) with respect to health in17 surance coverage within that State for plan years be18 ginning on or after January 1, 2017. Such applica19 tion shall— 

20 (A) be filed at such time and in such man21 ner as the Secretary may require; 

22 (B) contain such information as the Sec23 retary may require, including— 

24 (i) a comprehensive description of the 

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1 ment a plan meeting the requirements for 

2 a waiver under this section; and 

3 (ii) a 10-year budget plan for such 

4 plan that is budget neutral for the Federal 

5 Government; and 

6 (C) provide an assurance that the State 

7 has enacted the law described in subsection 

8 (b)(2). 

9 (2) REQUIREMENTS.—The requirements de10 scribed in this paragraph with respect to health in11 surance coverage within the State for plan years be12 ginning on or after January 1, 2014, are as follows: 

13 (A) Part I of subtitle D. 

14 (B) Part II of subtitle D. 

15 (C) Section 1402. 

16 (D) Sections 36B, 4980H, and 5000A of 

17 the Internal Revenue Code of 1986. 

18 (3) PASS THROUGH OF FUNDING.—With re19 spect to a State waiver under paragraph (1), under 

20 which, due to the structure of the State plan, indi21 viduals and small employers in the State would not 

22 qualify for the premium tax credits, cost-sharing re23 ductions, or small business credits under sections 

24 36B of the Internal Revenue Code of 1986 or under 

25 part I of subtitle E for which they would otherwise 


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1 be eligible, the Secretary shall provide for an alter2 native means by which the aggregate amount of such 

3 credits or reductions that would have been paid on 

4 behalf of participants in the Exchanges established 

5 under this title had the State not received such waiv6 er, shall be paid to the State for purposes of imple7 menting the State plan under the waiver. Such 

8 amount shall be determined annually by the Sec9 retary, taking into consideration the experience of 

10 other States with respect to participation in an Ex11 change and credits and reductions provided under 

12 such provisions to residents of the other States. 

13 (4) WAIVER CONSIDERATION AND TRANS14 PARENCY.— 

15 (A) IN GENERAL.—An application for a 

16 waiver under this section shall be considered by 

17 the Secretary in accordance with the regula18 tions described in subparagraph (B). 

19 (B) REGULATIONS.—Not later than 180 

20 days after the date of enactment of this Act, 

21 the Secretary shall promulgate regulations re22 lating to waivers under this section that pro23 vide— 

24 (i) a process for public notice and 

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1 lic hearings, sufficient to ensure a mean2 ingful level of public input; 

3 (ii) a process for the submission of an 

4 application that ensures the disclosure of— 

5 (I) the provisions of law that the 

6 State involved seeks to waive; and 

7 (II) the specific plans of the 

8 State to ensure that the waiver will be 

9 in compliance with subsection (b); 

10 (iii) a process for providing public no11 tice and comment after the application is 

12 received by the Secretary, that is sufficient 

13 to ensure a meaningful level of public 

14 input and that does not impose require15 ments that are in addition to, or duplica16 tive of, requirements imposed under the 

17 Administrative Procedures Act, or require18 ments that are unreasonable or unneces19 sarily burdensome with respect to State 

20 compliance; 

21 (iv) a process for the submission to 

22 the Secretary of periodic reports by the 

23 State concerning the implementation of the 

24 program under the waiver; and 


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1 (v) a process for the periodic evalua2 tion by the Secretary of the program under 

3 the waiver. 

4 (C) REPORT.—The Secretary shall annu5 ally report to Congress concerning actions 

6 taken by the Secretary with respect to applica7 tions for waivers under this section. 

8 (5) COORDINATED WAIVER PROCESS.—The Sec9 retary shall develop a process for coordinating and 

10 consolidating the State waiver processes applicable 

11 under the provisions of this section, and the existing 

12 waiver processes applicable under titles XVIII, XIX, 

13 and XXI of the Social Security Act, and any other 

14 Federal law relating to the provision of health care 

15 items or services. Such process shall permit a State 

16 to submit a single application for a waiver under any 

17 or all of such provisions. 

18 (6) DEFINITION.—In this section, the term 

19 ‘‘Secretary’’ means— 

20 (A) the Secretary of Health and Human 

21 Services with respect to waivers relating to the 

22 provisions described in subparagraph (A) 

23 through (C) of paragraph (2); and 


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1 (B) the Secretary of the Treasury with re2 spect to waivers relating to the provisions de3 scribed in paragraph (2)(D). 

4 (b) GRANTING OF WAIVERS.— 

5 (1) IN GENERAL.—The Secretary may grant a 

6 request for a waiver under subsection (a)(1) only if 

7 the Secretary determines that the State plan— 

8 (A) will provide coverage that is at least as 

9 comprehensive as the coverage defined in sec10 tion 1302(b) and offered through Exchanges es11 tablished under this title as certified by Office 

12 of the Actuary of the Centers for Medicare & 

13 Medicaid Services based on sufficient data from 

14 the State and from comparable States about 

15 their experience with programs created by this 

16 Act and the provisions of this Act that would 

17 be waived; 

18 (B) will provide coverage and cost sharing 

19 protections against excessive out-of-pocket 

20 spending that are at least as affordable as the 

21 provisions of this title would provide; 

22 (C) will provide coverage to at least a com23 parable number of its residents as the provi24 sions of this title would provide; and 

25 (D) will not increase the Federal deficit. 


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1 (2) REQUIREMENT TO ENACT A LAW.— 

2 (A) IN GENERAL.—A law described in this 

3 paragraph is a State law that provides for State 

4 actions under a waiver under this section, in5 cluding the implementation of the State plan 

6 under subsection (a)(1)(B). 

7 (B) TERMINATION OF OPT OUT.—A State 

8 may repeal a law described in subparagraph (A) 

9 and terminate the authority provided under the 

10 waiver with respect to the State. 

11 (c) SCOPE OF WAIVER.— 

12 (1) IN GENERAL.—The Secretary shall deter13 mine the scope of a waiver of a requirement de14 scribed in subsection (a)(2) granted to a State under 

15 subsection (a)(1). 

16 (2) LIMITATION.—The Secretary may not waive 

17 under this section any Federal law or requirement 

18 that is not within the authority of the Secretary. 

19 (d) DETERMINATIONS BY SECRETARY.— 

20 (1) TIME FOR DETERMINATION.—The Sec21 retary shall make a determination under subsection 

22 (a)(1) not later than 180 days after the receipt of 

23 an application from a State under such subsection. 

24 (2) EFFECT OF DETERMINATION.— 


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1 (A) GRANTING OF WAIVERS.—If the Sec2 retary determines to grant a waiver under sub3 section (a)(1), the Secretary shall notify the 

4 State involved of such determination and the 

5 terms and effectiveness of such waiver. 

6 (B) DENIAL OF WAIVER.—If the Secretary 

7 determines a waiver should not be granted 

8 under subsection (a)(1), the Secretary shall no9 tify the State involved, and the appropriate 

10 committees of Congress of such determination 

11 and the reasons therefore. 

12 (e) TERM OF WAIVER.—No waiver under this section 

13 may extend over a period of longer than 5 years unless 

14 the State requests continuation of such waiver, and such 

15 request shall be deemed granted unless the Secretary, 

16 within 90 days after the date of its submission to the Sec17 retary, either denies such request in writing or informs 

18 the State in writing with respect to any additional infor19 mation which is needed in order to make a final deter20 mination with respect to the request. 

21 SEC. 1333. PROVISIONS RELATING TO OFFERING OF PLANS 

22 IN MORE THAN ONE STATE. 

23 (a) HEALTH CARE CHOICE COMPACTS.— 

24 (1) IN GENERAL.—Not later than July 1, 2013, 

25 the Secretary shall, in consultation with the National 


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1 Association of Insurance Commissioners, issue regu2 lations for the creation of health care choice com3 pacts under which 2 or more States may enter into 

4 an agreement under which— 

5 (A) 1 or more qualified health plans could 

6 be offered in the individual markets in all such 

7 States but, except as provided in subparagraph 

8 (B), only be subject to the laws and regulations 

9 of the State in which the plan was written or 

10 issued; 

11 (B) the issuer of any qualified health plan 

12 to which the compact applies— 

13 (i) would continue to be subject to 

14 market conduct, unfair trade practices, 

15 network adequacy, and consumer protec16 tion standards (including standards relat17 ing to rating), including addressing dis18 putes as to the performance of the con19 tract, of the State in which the purchaser 

20 resides; 

21 (ii) would be required to be licensed in 

22 each State in which it offers the plan 

23 under the compact or to submit to the ju24 risdiction of each such State with regard to 

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1 cluding allowing access to records as if the 

2 insurer were licensed in the State); and 

3 (iii) must clearly notify consumers 

4 that the policy may not be subject to all 

5 the laws and regulations of the State in 

6 which the purchaser resides. 

7 (2) STATE AUTHORITY.—A State may not enter 

8 into an agreement under this subsection unless the 

9 State enacts a law after the date of the enactment 

10 of this title that specifically authorizes the State to 

11 enter into such agreements. 

12 (3) APPROVAL OF COMPACTS.—The Secretary 

13 may approve interstate health care choice compacts 

14 under paragraph (1) only if the Secretary deter15 mines that such health care choice compact— 

16 (A) will provide coverage that is at least as 

17 comprehensive as the coverage defined in sec18 tion 1302(b) and offered through Exchanges es19 tablished under this title; 

20 (B) will provide coverage and cost sharing 

21 protections against excessive out-of-pocket 

22 spending that are at least as affordable as the 

23 provisions of this title would provide; 


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1 (C) will provide coverage to at least a com2 parable number of its residents as the provi3 sions of this title would provide; 

4 (D) will not increase the Federal deficit; 

5 and 

6 (E) will not weaken enforcement of laws 

7 and regulations described in paragraph 

8 (1)(B)(i) in any State that is included in such 

9 compact. 

10 (4) EFFECTIVE DATE.—A health care choice 

11 compact described in paragraph (1) shall not take 

12 effect before January 1, 2016. 

13 (b) AUTHORITY FOR NATIONWIDE PLANS.— 

14 (1) IN GENERAL.—Except as provided in para15 graph (2), if an issuer (including a group of health 

16 insurance issuers affiliated either by common owner17 ship and control or by the common use of a nation18 ally licensed service mark) of a qualified health plan 

19 in the individual or small group market meets the 

20 requirements of this subsection (in this subsection a 

21 ‘‘nationwide qualified health plan’’)— 

22 (A) the issuer of the plan may offer the 

23 nationwide qualified health plan in the indi24 vidual or small group market in more than 1 

25 State; and 


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1 (B) with respect to State laws mandating 

2 benefit coverage by a health plan, only the 

3 State laws of the State in which such plan is 

4 written or issued shall apply to the nationwide 

5 qualified health plan. 

6 (2) STATE OPT-OUT.—A State may, by specific 

7 reference in a law enacted after the date of enact8 ment of this title, provide that this subsection shall 

9 not apply to that State. Such opt-out shall be effec10 tive until such time as the State by law revokes it. 

11 (3) PLAN REQUIREMENTS.—An issuer meets 

12 the requirements of this subsection with respect to 

13 a nationwide qualified health plan if, in the deter14 mination of the Secretary— 

15 (A) the plan offers a benefits package that 

16 is uniform in each State in which the plan is of17 fered and meets the requirements set forth in 

18 paragraphs (4) through (6); 

19 (B) the issuer is licensed in each State in 

20 which it offers the plan and is subject to all re21 quirements of State law not inconsistent with 

22 this section, including but not limited to, the 

23 standards and requirements that a State im24 poses that do not prevent the application of a 

25 requirement of part A of title XXVII of the 


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1 Public Health Service Act or a requirement of 

2 this title; 

3 (C) the issuer meets all requirements of 

4 this title with respect to a qualified health plan, 

5 including the requirement to offer the silver and 

6 gold levels of the plan in each Exchange in the 

7 State for the market in which the plan is of8 fered; 

9 (D) the issuer determines the premiums 

10 for the plan in any State on the basis of the 

11 rating rules in effect in that State for the rat12 ing areas in which it is offered; 

13 (E) the issuer offers the nationwide quali14 fied health plan in at least 60 percent of the 

15 participating States in the first year in which 

16 the plan is offered, 65 percent of such States 

17 in the second year, 70 percent of such States in 

18 the third year, 75 percent of such States in the 

19 fourth year, and 80 percent of such States in 

20 the fifth and subsequent years; 

21 (F) the issuer shall offer the plan in par22 ticipating States across the country, in all geo23 graphic regions, and in all States that have 

24 adopted adjusted community rating before the 

25 date of enactment of this Act; and 


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1 (G) the issuer clearly notifies consumers 

2 that the policy may not contain some benefits 

3 otherwise mandated for plans in the State in 

4 which the purchaser resides and provides a de5 tailed statement of the benefits offered and the 

6 benefit differences in that State, in accordance 

7 with rules promulgated by the Secretary. 

8 (4) FORM REVIEW FOR NATIONWIDE PLANS.— 

9 Notwithstanding any contrary provision of State 

10 law, at least 3 months before any nationwide quali11 fied health plan is offered, the issuer shall file all na12 tionwide qualified health plan forms with the regu13 lator in each participating State in which the plan 

14 will be offered. An issuer may appeal the disapproval 

15 of a nationwide qualified health plan form to the 

16 Secretary. 

17 (5) APPLICABLE RULES.—The Secretary shall, 

18 in consultation with the National Association of In19 surance Commissioners, issue rules for the offering 

20 of nationwide qualified health plans under this sub21 section. Nationwide qualified health plans may be of22 fered only after such rules have taken effect. 

23 (6) COVERAGE.—The Secretary shall provide 

24 that the health benefits coverage provided to an indi25 vidual through a nationwide qualified health plan 


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1 under this subsection shall include at least the es2 sential benefits package described in section 1302. 

3 (7) STATE LAW MANDATING BENEFIT COV4 ERAGE BY A HEALTH BENEFITS PLAN.—For the 

5 purposes of this subsection, a State law mandating 

6 benefit coverage by a health plan is a law that man7 dates health insurance coverage or the offer of 

8 health insurance coverage for specific health services 

9 or specific diseases. A law that mandates health in10 surance coverage or reimbursement for services pro11 vided by certain classes of providers of health care 

12 services, or a law that mandates that certain classes 

13 of individuals must be covered as a group or as de14 pendents, is not a State law mandating benefit cov15 erage by a health benefits plan. 

16 PART V—REINSURANCE AND RISK ADJUSTMENT 

17 SEC. 1341. TRANSITIONAL REINSURANCE PROGRAM FOR 

18 INDIVIDUAL AND SMALL GROUP MARKETS IN 

19 EACH STATE. 

20 (a) IN GENERAL.—Each State shall, not later than 

21 January 1, 2014— 

22 (1) include in the Federal standards or State 

23 law or regulation the State adopts and has in effect 

24 under section 1321(b) the provisions described in 

25 subsection (b); and 


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1 (2) establish (or enter into a contract with) 1 

2 or more applicable reinsurance entities to carry out 

3 the reinsurance program under this section. 

4 (b) MODEL REGULATION.— 

5 (1) IN GENERAL.—In establishing the Federal 

6 standards under section 1321(a), the Secretary, in 

7 consultation with the National Association of Insur8 ance Commissioners (the ‘‘NAIC’’), shall include 

9 provisions that enable States to establish and main10 tain a program under which— 

11 (A) health insurance issuers, and third 

12 party administrators on behalf of group health 

13 plans, are required to make payments to an ap14 plicable reinsurance entity for any plan year be15 ginning in the 3-year period beginning January 

16 1, 2014 (as specified in paragraph (3); and 

17 (B) the applicable reinsurance entity col18 lects payments under subparagraph (A) and 

19 uses amounts so collected to make reinsurance 

20 payments to health insurance issuers described 

21 in subparagraph (A) that cover high risk indi22 viduals in the individual market (excluding 

23 grandfathered health plans) for any plan year 

24 beginning in such 3-year period. 


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1 (2) HIGH-RISK INDIVIDUAL; PAYMENT

2 AMOUNTS.—The Secretary shall include the fol3 lowing in the provisions under paragraph (1): 

4 (A) DETERMINATION OF HIGH-RISK INDI5 VIDUALS.—The method by which individuals 

6 will be identified as high risk individuals for 

7 purposes of the reinsurance program estab8 lished under this section. Such method shall 

9 provide for identification of individuals as high10 risk individuals on the basis of— 

11 (i) a list of at least 50 but not more 

12 than 100 medical conditions that are iden13 tified as high-risk conditions and that may 

14 be based on the identification of diagnostic 

15 and procedure codes that are indicative of 

16 individuals with pre-existing, high-risk con17 ditions; or 

18 (ii) any other comparable objective 

19 method of identification recommended by 

20 the American Academy of Actuaries. 

21 (B) PAYMENT AMOUNT.—The formula for 

22 determining the amount of payments that will 

23 be paid to health insurance issuers described in 

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1 table allocation of available funds through rec2 onciliation and may be designed— 

3 (i) to provide a schedule of payments 

4 that specifies the amount that will be paid 

5 for each of the conditions identified under 

6 subparagraph (A); or 

7 (ii) to use any other comparable meth8 od for determining payment amounts that 

9 is recommended by the American Academy 

10 of Actuaries and that encourages the use 

11 of care coordination and care management 

12 programs for high risk conditions. 

13 (3) DETERMINATION OF REQUIRED CONTRIBU14 TIONS.— 

15 (A) IN GENERAL.—The Secretary shall in16 clude in the provisions under paragraph (1) the 

17 method for determining the amount each health 

18 insurance issuer and group health plan de19 scribed in paragraph (1)(A) contributing to the 

20 reinsurance program under this section is re21 quired to contribute under such paragraph for 

22 each plan year beginning in the 36-month pe23 riod beginning January 1, 2014. The contribu24 tion amount for any plan year may be based on 

25 the percentage of revenue of each issuer and 


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1 the total costs of providing benefits to enrollees 

2 in self-insured plans or on a specified amount 

3 per enrollee and may be required to be paid in 

4 advance or periodically throughout the plan 

5 year. 

6 (B) SPECIFIC REQUIREMENTS.—The meth7 od under this paragraph shall be designed so 

8 that— 

9 (i) the contribution amount for each 

10 issuer proportionally reflects each issuer’s 

11 fully insured commercial book of business 

12 for all major medical products and the 

13 total value of all fees charged by the issuer 

14 and the costs of coverage administered by 

15 the issuer as a third party administrator; 

16 (ii) the contribution amount can in17 clude an additional amount to fund the ad18 ministrative expenses of the applicable re19 insurance entity; 

20 (iii) the aggregate contribution 

21 amounts for all States shall, based on the 

22 best estimates of the NAIC and without 

23 regard to amounts described in clause (ii), 

24 equal $10,000,000,000 for plan years be25 ginning in 2014, $6,000,000,000 for plan 


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1 years beginning 2015, and $4,000,000,000 

2 for plan years beginning in 2016; and 

3 (iv) in addition to the aggregate con4 tribution amounts under clause (iii), each 

5 issuer’s contribution amount for any cal6 endar year under clause (iii) reflects its 

7 proportionate share of an additional 

8 $2,000,000,000 for 2014, an additional 

9 $2,000,000,000 for 2015, and an addi10 tional $1,000,000,000 for 2016. 

11 Nothing in this subparagraph shall be con12 strued to preclude a State from collecting addi13 tional amounts from issuers on a voluntary 

14 basis. 

15 (4) EXPENDITURE OF FUNDS.—The provisions 

16 under paragraph (1) shall provide that— 

17 (A) the contribution amounts collected for 

18 any calendar year may be allocated and used in 

19 any of the three calendar years for which 

20 amounts are collected based on the reinsurance 

21 needs of a particular period or to reflect experi22 ence in a prior period; and 

23 (B) amounts remaining unexpended as of 

24 December, 2016, may be used to make pay25 ments under any reinsurance program of a 


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1 State in the individual market in effect in the 

2 2-year period beginning on January 1, 2017. 

3 Notwithstanding the preceding sentence, any con4 tribution amounts described in paragraph (3)(B)(iv) 

5 shall be deposited into the general fund of the 

6 Treasury of the United States and may not be used 

7 for the program established under this section. 

8 (c) APPLICABLE REINSURANCE ENTITY.—For pur9 poses of this section— 

10 (1) IN GENERAL.—The term ‘‘applicable rein11 surance entity’’ means a not-for-profit organiza12 tion— 

13 (A) the purpose of which is to help sta14 bilize premiums for coverage in the individual 

15 and small group markets in a State during the 

16 first 3 years of operation of an Exchange for 

17 such markets within the State when the risk of 

18 adverse selection related to new rating rules 

19 and market changes is greatest; and 

20 (B) the duties of which shall be to carry 

21 out the reinsurance program under this section 

22 by coordinating the funding and operation of 

23 the risk-spreading mechanisms designed to im24 plement the reinsurance program. 


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1 (2) STATE DISCRETION.—A State may have 

2 more than 1 applicable reinsurance entity to carry 

3 out the reinsurance program under this section with4 in the State and 2 or more States may enter into 

5 agreements to provide for an applicable reinsurance 

6 entity to carry out such program in all such States. 

7 (3) ENTITIES ARE TAX-EXEMPT.—An applicable 

8 reinsurance entity established under this section 

9 shall be exempt from taxation under chapter 1 of 

10 the Internal Revenue Code of 1986. The preceding 

11 sentence shall not apply to the tax imposed by sec12 tion 511 such Code (relating to tax on unrelated 

13 business taxable income of an exempt organization). 

14 (d) COORDINATION WITH STATE HIGH-RISK

15 POOLS.—The State shall eliminate or modify any State 

16 high-risk pool to the extent necessary to carry out the re17 insurance program established under this section. The 

18 State may coordinate the State high-risk pool with such 

19 program to the extent not inconsistent with the provisions 

20 of this section. 

21 SEC. 1342. ESTABLISHMENT OF RISK CORRIDORS FOR 

22 PLANS IN INDIVIDUAL AND SMALL GROUP 

23 MARKETS. 

24 (a) IN GENERAL.—The Secretary shall establish and 

25 administer a program of risk corridors for calendar years 


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1 2014, 2015, and 2016 under which a qualified health plan 

2 offered in the individual or small group market shall par3 ticipate in a payment adjustment system based on the 

4 ratio of the allowable costs of the plan to the plan’s aggre5 gate premiums. Such program shall be based on the pro6 gram for regional participating provider organizations 

7 under part D of title XVIII of the Social Security Act. 

8 (b) PAYMENT METHODOLOGY.— 

9 (1) PAYMENTS OUT.—The Secretary shall pro10 vide under the program established under subsection 

11 (a) that if— 

12 (A) a participating plan’s allowable costs 

13 for any plan year are more than 103 percent 

14 but not more than 108 percent of the target 

15 amount, the Secretary shall pay to the plan an 

16 amount equal to 50 percent of the target 

17 amount in excess of 103 percent of the target 

18 amount; and 

19 (B) a participating plan’s allowable costs 

20 for any plan year are more than 108 percent of 

21 the target amount, the Secretary shall pay to 

22 the plan an amount equal to the sum of 2.5 

23 percent of the target amount plus 80 percent of 

24 allowable costs in excess of 108 percent of the 

25 target amount. 


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1 (2) PAYMENTS IN.—The Secretary shall provide 

2 under the program established under subsection (a) 

3 that if— 

4 (A) a participating plan’s allowable costs 

5 for any plan year are less than 97 percent but 

6 not less than 92 percent of the target amount, 

7 the plan shall pay to the Secretary an amount 

8 equal to 50 percent of the excess of 97 percent 

9 of the target amount over the allowable costs; 

10 and 

11 (B) a participating plan’s allowable costs 

12 for any plan year are less than 92 percent of 

13 the target amount, the plan shall pay to the 

14 Secretary an amount equal to the sum of 2.5 

15 percent of the target amount plus 80 percent of 

16 the excess of 92 percent of the target amount 

17 over the allowable costs. 

18 (c) DEFINITIONS.—In this section: 

19 (1) ALLOWABLE COSTS.— 

20 (A) IN GENERAL.—The amount of allow21 able costs of a plan for any year is an amount 

22 equal to the total costs (other than administra23 tive costs) of the plan in providing benefits cov24 ered by the plan. 


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1 (B) REDUCTION FOR RISK ADJUSTMENT

2 AND REINSURANCE PAYMENTS.—Allowable 

3 costs shall reduced by any risk adjustment and 

4 reinsurance payments received under section 

5 1341 and 1343. 

6 (2) TARGET AMOUNT.—The target amount of a 

7 plan for any year is an amount equal to the total 

8 premiums (including any premium subsidies under 

9 any governmental program), reduced by the adminis10 trative costs of the plan. 

11 SEC. 1343. RISK ADJUSTMENT. 

12 (a) IN GENERAL.— 

13 (1) LOW ACTUARIAL RISK PLANS.—Using the 

14 criteria and methods developed under subsection (b), 

15 each State shall assess a charge on health plans and 

16 health insurance issuers (with respect to health in17 surance coverage) described in subsection (c) if the 

18 actuarial risk of the enrollees of such plans or cov19 erage for a year is less than the average actuarial 

20 risk of all enrollees in all plans or coverage in such 

21 State for such year that are not self-insured group 

22 health plans (which are subject to the provisions of 

23 the Employee Retirement Income Security Act of 

24 1974). 


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1 (2) HIGH ACTUARIAL RISK PLANS.—Using the 

2 criteria and methods developed under subsection (b), 

3 each State shall provide a payment to health plans 

4 and health insurance issuers (with respect to health 

5 insurance coverage) described in subsection (c) if the 

6 actuarial risk of the enrollees of such plans or cov7 erage for a year is greater than the average actu8 arial risk of all enrollees in all plans and coverage 

9 in such State for such year that are not self-insured 

10 group health plans (which are subject to the provi11 sions of the Employee Retirement Income Security 

12 Act of 1974). 

13 (b) CRITERIA AND METHODS.—The Secretary, in 

14 consultation with States, shall establish criteria and meth15 ods to be used in carrying out the risk adjustment activi16 ties under this section. The Secretary may utilize criteria 

17 and methods similar to the criteria and methods utilized 

18 under part C or D of title XVIII of the Social Security 

19 Act. Such criteria and methods shall be included in the 

20 standards and requirements the Secretary prescribes 

21 under section 1321. 

22 (c) SCOPE.—A health plan or a health insurance 

23 issuer is described in this subsection if such health plan 

24 or health insurance issuer provides coverage in the indi25 vidual or small group market within the State. This subVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00237 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 section shall not apply to a grandfathered health plan or 

2 the issuer of a grandfathered health plan with respect to 

3 that plan. 

4 Subtitle E—Affordable Coverage 

5 Choices for All Americans 

6 PART I—PREMIUM TAX CREDITS AND COST7 SHARING REDUCTIONS 

8 Subpart A—Premium Tax Credits and Cost-sharing 

9 Reductions 

10 SEC. 1401. REFUNDABLE TAX CREDIT PROVIDING PREMIUM 

11 ASSISTANCE FOR COVERAGE UNDER A 

12 QUALIFIED HEALTH PLAN. 

13 (a) IN GENERAL.—Subpart C of part IV of sub14 chapter A of chapter 1 of the Internal Revenue Code of 

15 1986 (relating to refundable credits) is amended by insert16 ing after section 36A the following new section: 

17 ‘‘SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A 

18 QUALIFIED HEALTH PLAN. 

19 ‘‘(a) IN GENERAL.—In the case of an applicable tax20 payer, there shall be allowed as a credit against the tax 

21 imposed by this subtitle for any taxable year an amount 

22 equal to the premium assistance credit amount of the tax23 payer for the taxable year. 

24 ‘‘(b) PREMIUM ASSISTANCE CREDIT AMOUNT.—For 

25 purposes of this section— 


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1 ‘‘(1) IN GENERAL.—The term ‘premium assist2 ance credit amount’ means, with respect to any tax3 able year, the sum of the premium assistance 

4 amounts determined under paragraph (2) with re5 spect to all coverage months of the taxpayer occur6 ring during the taxable year. 

7 ‘‘(2) PREMIUM ASSISTANCE AMOUNT.—The pre8 mium assistance amount determined under this sub9 section with respect to any coverage month is the 

10 amount equal to the lesser of— 

11 ‘‘(A) the monthly premiums for such 

12 month for 1 or more qualified health plans of13 fered in the individual market within a State 

14 which cover the taxpayer, the taxpayer’s spouse, 

15 or any dependent (as defined in section 152) of 

16 the taxpayer and which were enrolled in 

17 through an Exchange established by the State 

18 under 1311 of the Patient Protection and Af19 fordable Care Act, or 

20 ‘‘(B) the excess (if any) of— 

21 ‘‘(i) the adjusted monthly premium 

22 for such month for the applicable second 

23 lowest cost silver plan with respect to the 

24 taxpayer, over 


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1 ‘‘(ii) an amount equal to 1/12 of the 

2 product of the applicable percentage and 

3 the taxpayer’s household income for the 

4 taxable year. 

5 ‘‘(3) OTHER TERMS AND RULES RELATING TO

6 PREMIUM ASSISTANCE AMOUNTS.—For purposes of 

7 paragraph (2)— 

8 ‘‘(A) APPLICABLE PERCENTAGE.— 

9 ‘‘(i) IN GENERAL.—Except as pro10 vided in clause (ii), the applicable percent11 age with respect to any taxpayer for any 

12 taxable year is equal to 2.8 percent, in13 creased by the number of percentage 

14 points (not greater than 7) which bears the 

15 same ratio to 7 percentage points as— 

16 ‘‘(I) the taxpayer’s household in17 come for the taxable year in excess of 

18 100 percent of the poverty line for a 

19 family of the size involved, bears to 

20 ‘‘(II) an amount equal to 200 

21 percent of the poverty line for a fam22 ily of the size involved. 

23 ‘‘(ii) SPECIAL RULE FOR TAXPAYERS

24 UNDER 133 PERCENT OF POVERTY LINE.— 

25 If a taxpayer’s household income for the 


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1 taxable year is in excess of 100 percent, 

2 but not more than 133 percent, of the pov3 erty line for a family of the size involved, 

4 the taxpayer’s applicable percentage shall 

5 be 2 percent. 

6 ‘‘(iii) INDEXING.—In the case of tax7 able years beginning in any calendar year 

8 after 2014, the Secretary shall adjust the 

9 initial and final applicable percentages 

10 under clause (i), and the 2 percent under 

11 clause (ii), for the calendar year to reflect 

12 the excess of the rate of premium growth 

13 between the preceding calendar year and 

14 2013 over the rate of income growth for 

15 such period. 

16 ‘‘(B) APPLICABLE SECOND LOWEST COST

17 SILVER PLAN.—The applicable second lowest 

18 cost silver plan with respect to any applicable 

19 taxpayer is the second lowest cost silver plan of 

20 the individual market in the rating area in 

21 which the taxpayer resides which— 

22 ‘‘(i) is offered through the same Ex23 change through which the qualified health 

24 plans taken into account under paragraph 

25 (2)(A) were offered, and 


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1 ‘‘(ii) provides— 

2 ‘‘(I) self-only coverage in the case 

3 of an applicable taxpayer— 

4 ‘‘(aa) whose tax for the tax5 able year is determined under 

6 section 1(c) (relating to unmar7 ried individuals other than sur8 viving spouses and heads of 

9 households) and who is not al10 lowed a deduction under section 

11 151 for the taxable year with re12 spect to a dependent, or 

13 ‘‘(bb) who is not described 

14 in item (aa) but who purchases 

15 only self-only coverage, and 

16 ‘‘(II) family coverage in the case 

17 of any other applicable taxpayer. 

18 If a taxpayer files a joint return and no credit 

19 is allowed under this section with respect to 1 

20 of the spouses by reason of subsection (e), the 

21 taxpayer shall be treated as described in clause 

22 (ii)(I) unless a deduction is allowed under sec23 tion 151 for the taxable year with respect to a 

24 dependent other than either spouse and sub25 section (e) does not apply to the dependent. 


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1 ‘‘(C) ADJUSTED MONTHLY PREMIUM.— 

2 The adjusted monthly premium for an applica3 ble second lowest cost silver plan is the monthly 

4 premium which would have been charged (for 

5 the rating area with respect to which the pre6 miums under paragraph (2)(A) were deter7 mined) for the plan if each individual covered 

8 under a qualified health plan taken into account 

9 under paragraph (2)(A) were covered by such 

10 silver plan and the premium was adjusted only 

11 for the age of each such individual in the man12 ner allowed under section 2701 of the Public 

13 Health Service Act. In the case of a State par14 ticipating in the wellness discount demonstra15 tion project under section 2705(d) of the Public 

16 Health Service Act, the adjusted monthly pre17 mium shall be determined without regard to 

18 any premium discount or rebate under such 

19 project. 

20 ‘‘(D) ADDITIONAL BENEFITS.—If— 

21 ‘‘(i) a qualified health plan under sec22 tion 1302(b)(5) of the Patient Protection 

23 and Affordable Care Act offers benefits in 

24 addition to the essential health benefits re25 quired to be provided by the plan, or 


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1 ‘‘(ii) a State requires a qualified 

2 health plan under section 1311(d)(3)(B) of 

3 such Act to cover benefits in addition to 

4 the essential health benefits required to be 

5 provided by the plan, 

6 the portion of the premium for the plan prop7 erly allocable (under rules prescribed by the 

8 Secretary of Health and Human Services) to 

9 such additional benefits shall not be taken into 

10 account in determining either the monthly pre11 mium or the adjusted monthly premium under 

12 paragraph (2). 

13 ‘‘(E) SPECIAL RULE FOR PEDIATRIC DEN14 TAL COVERAGE.—For purposes of determining 

15 the amount of any monthly premium, if an indi16 vidual enrolls in both a qualified health plan 

17 and a plan described in section 

18 1311(d)(2)(B)(ii)(I) of the Patient Protection 

19 and Affordable Care Act for any plan year, the 

20 portion of the premium for the plan described 

21 in such section that (under regulations pre22 scribed by the Secretary) is properly allocable 

23 to pediatric dental benefits which are included 

24 in the essential health benefits required to be 

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1 tion 1302(b)(1)(J) of such Act shall be treated 

2 as a premium payable for a qualified health 

3 plan. 

4 ‘‘(c) DEFINITION AND RULES RELATING TO APPLI5 CABLE TAXPAYERS, COVERAGE MONTHS, AND QUALIFIED

6 HEALTH PLAN.—For purposes of this section— 

7 ‘‘(1) APPLICABLE TAXPAYER.— 

8 ‘‘(A) IN GENERAL.—The term ‘applicable 

9 taxpayer’ means, with respect to any taxable 

10 year, a taxpayer whose household income for 

11 the taxable year exceeds 100 percent but does 

12 not exceed 400 percent of an amount equal to 

13 the poverty line for a family of the size in14 volved. 

15 ‘‘(B) SPECIAL RULE FOR CERTAIN INDI16 VIDUALS LAWFULLY PRESENT IN THE UNITED

17 STATES.—If— 

18 ‘‘(i) a taxpayer has a household in19 come which is not greater than 100 per20 cent of an amount equal to the poverty line 

21 for a family of the size involved, and 

22 ‘‘(ii) the taxpayer is an alien lawfully 

23 present in the United States, but is not eli24 gible for the medicaid program under title 


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1 XIX of the Social Security Act by reason 

2 of such alien status, 

3 the taxpayer shall, for purposes of the credit 

4 under this section, be treated as an applicable 

5 taxpayer with a household income which is 

6 equal to 100 percent of the poverty line for a 

7 family of the size involved. 

8 ‘‘(C) MARRIED COUPLES MUST FILE JOINT

9 RETURN.—If the taxpayer is married (within 

10 the meaning of section 7703) at the close of the 

11 taxable year, the taxpayer shall be treated as an 

12 applicable taxpayer only if the taxpayer and the 

13 taxpayer’s spouse file a joint return for the tax14 able year. 

15 ‘‘(D) DENIAL OF CREDIT TO DEPEND16 ENTS.—No credit shall be allowed under this 

17 section to any individual with respect to whom 

18 a deduction under section 151 is allowable to 

19 another taxpayer for a taxable year beginning 

20 in the calendar year in which such individual’s 

21 taxable year begins. 

22 ‘‘(2) COVERAGE MONTH.—For purposes of this 

23 subsection— 


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1 ‘‘(A) IN GENERAL.—The term ‘coverage 

2 month’ means, with respect to an applicable 

3 taxpayer, any month if— 

4 ‘‘(i) as of the first day of such month 

5 the taxpayer, the taxpayer’s spouse, or any 

6 dependent of the taxpayer is covered by a 

7 qualified health plan described in sub8 section (b)(2)(A) that was enrolled in 

9 through an Exchange established by the 

10 State under section 1311 of the Patient 

11 Protection and Affordable Care Act, and 

12 ‘‘(ii) the premium for coverage under 

13 such plan for such month is paid by the 

14 taxpayer (or through advance payment of 

15 the credit under subsection (a) under sec16 tion 1412 of the Patient Protection and 

17 Affordable Care Act). 

18 ‘‘(B) EXCEPTION FOR MINIMUM ESSEN19 TIAL COVERAGE.— 

20 ‘‘(i) IN GENERAL.—The term ‘cov21 erage month’ shall not include any month 

22 with respect to an individual if for such 

23 month the individual is eligible for min24 imum essential coverage other than eligi25 bility for coverage described in section 


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1 5000A(f)(1)(C) (relating to coverage in the 

2 individual market). 

3 ‘‘(ii) MINIMUM ESSENTIAL COV4 ERAGE.—The term ‘minimum essential 

5 coverage’ has the meaning given such term 

6 by section 5000A(f). 

7 ‘‘(C) SPECIAL RULE FOR EMPLOYER-SPON8 SORED MINIMUM ESSENTIAL COVERAGE.—For 

9 purposes of subparagraph (B)— 

10 ‘‘(i) COVERAGE MUST BE AFFORD11 ABLE.—Except as provided in clause (iii), 

12 an employee shall not be treated as eligible 

13 for minimum essential coverage if such 

14 coverage— 

15 ‘‘(I) consists of an eligible em16 ployer-sponsored plan (as defined in 

17 section 5000A(f)(2)), and 

18 ‘‘(II) the employee’s required 

19 contribution (within the meaning of 

20 section 5000A(e)(1)(B)) with respect 

21 to the plan exceeds 9.8 percent of the 

22 applicable taxpayer’s household in23 come. 

24 This clause shall also apply to an indi25 vidual who is eligible to enroll in the plan 


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•AMDT. NO. 2786 

1 by reason of a relationship the individual 

2 bears to the employee. 

3 ‘‘(ii) COVERAGE MUST PROVIDE MIN4 IMUM VALUE.—Except as provided in 

5 clause (iii), an employee shall not be treat6 ed as eligible for minimum essential cov7 erage if such coverage consists of an eligi8 ble employer-sponsored plan (as defined in 

9 section 5000A(f)(2)) and the plan’s share 

10 of the total allowed costs of benefits pro11 vided under the plan is less than 60 per12 cent of such costs. 

13 ‘‘(iii) EMPLOYEE OR FAMILY MUST

14 NOT BE COVERED UNDER EMPLOYER

15 PLAN.—Clauses (i) and (ii) shall not apply 

16 if the employee (or any individual de17 scribed in the last sentence of clause (i)) is 

18 covered under the eligible employer-spon19 sored plan or the grandfathered health 

20 plan. 

21 ‘‘(iv) INDEXING.—In the case of plan 

22 years beginning in any calendar year after 

23 2014, the Secretary shall adjust the 9.8 

24 percent under clause (i)(II) in the same 


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•AMDT. NO. 2786 

1 manner as the percentages are adjusted 

2 under subsection (b)(3)(A)(ii). 

3 ‘‘(3) DEFINITIONS AND OTHER RULES.— 

4 ‘‘(A) QUALIFIED HEALTH PLAN.—The 

5 term ‘qualified health plan’ has the meaning 

6 given such term by section 1301(a) of the Pa7 tient Protection and Affordable Care Act, ex8 cept that such term shall not include a qualified 

9 health plan which is a catastrophic plan de10 scribed in section 1302(e) of such Act. 

11 ‘‘(B) GRANDFATHERED HEALTH PLAN.— 

12 The term ‘grandfathered health plan’ has the 

13 meaning given such term by section 1251 of the 

14 Patient Protection and Affordable Care Act. 

15 ‘‘(d) TERMS RELATING TO INCOME AND FAMILIES.— 

16 For purposes of this section— 

17 ‘‘(1) FAMILY SIZE.—The family size involved 

18 with respect to any taxpayer shall be equal to the 

19 number of individuals for whom the taxpayer is al20 lowed a deduction under section 151 (relating to al21 lowance of deduction for personal exemptions) for 

22 the taxable year. 

23 ‘‘(2) HOUSEHOLD INCOME.— 


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•AMDT. NO. 2786 

1 ‘‘(A) HOUSEHOLD INCOME.—The term 

2 ‘household income’ means, with respect to any 

3 taxpayer, an amount equal to the sum of— 

4 ‘‘(i) the modified gross income of the 

5 taxpayer, plus 

6 ‘‘(ii) the aggregate modified gross in7 comes of all other individuals who— 

8 ‘‘(I) were taken into account in 

9 determining the taxpayer’s family size 

10 under paragraph (1), and 

11 ‘‘(II) were required to file a re12 turn of tax imposed by section 1 for 

13 the taxable year. 

14 ‘‘(B) MODIFIED GROSS INCOME.—The 

15 term ‘modified gross income’ means gross in16 come— 

17 ‘‘(i) decreased by the amount of any 

18 deduction allowable under paragraph (1), 

19 (3), (4), or (10) of section 62(a), 

20 ‘‘(ii) increased by the amount of inter21 est received or accrued during the taxable 

22 year which is exempt from tax imposed by 

23 this chapter, and 

24 ‘‘(iii) determined without regard to 

25 sections 911, 931, and 933. 


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1 ‘‘(3) POVERTY LINE.— 

2 ‘‘(A) IN GENERAL.—The term ‘poverty 

3 line’ has the meaning given that term in section 

4 2110(c)(5) of the Social Security Act (42 

5 U.S.C. 1397jj(c)(5)). 

6 ‘‘(B) POVERTY LINE USED.—In the case of 

7 any qualified health plan offered through an 

8 Exchange for coverage during a taxable year 

9 beginning in a calendar year, the poverty line 

10 used shall be the most recently published pov11 erty line as of the 1st day of the regular enroll12 ment period for coverage during such calendar 

13 year. 

14 ‘‘(e) RULES FOR INDIVIDUALS NOT LAWFULLY

15 PRESENT.— 

16 ‘‘(1) IN GENERAL.—If 1 or more individuals for 

17 whom a taxpayer is allowed a deduction under sec18 tion 151 (relating to allowance of deduction for per19 sonal exemptions) for the taxable year (including the 

20 taxpayer or his spouse) are individuals who are not 

21 lawfully present— 

22 ‘‘(A) the aggregate amount of premiums 

23 otherwise taken into account under clauses (i) 

24 and (ii) of subsection (b)(2)(A) shall be reduced 


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•AMDT. NO. 2786 

1 by the portion (if any) of such premiums which 

2 is attributable to such individuals, and 

3 ‘‘(B) for purposes of applying this section, 

4 the determination as to what percentage a tax5 payer’s household income bears to the poverty 

6 level for a family of the size involved shall be 

7 made under one of the following methods: 

8 ‘‘(i) A method under which— 

9 ‘‘(I) the taxpayer’s family size is 

10 determined by not taking such indi11 viduals into account, and 

12 ‘‘(II) the taxpayer’s household in13 come is equal to the product of the 

14 taxpayer’s household income (deter15 mined without regard to this sub16 section) and a fraction— 

17 ‘‘(aa) the numerator of 

18 which is the poverty line for the 

19 taxpayer’s family size determined 

20 after application of subclause (I), 

21 and 

22 ‘‘(bb) the denominator of 

23 which is the poverty line for the 

24 taxpayer’s family size determined 

25 without regard to subclause (I). 


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•AMDT. NO. 2786 

1 ‘‘(ii) A comparable method reaching 

2 the same result as the method under 

3 clause (i). 

4 ‘‘(2) LAWFULLY PRESENT.—For purposes of 

5 this section, an individual shall be treated as law6 fully present only if the individual is, and is reason7 ably expected to be for the entire period of enroll8 ment for which the credit under this section is being 

9 claimed, a citizen or national of the United States 

10 or an alien lawfully present in the United States. 

11 ‘‘(3) SECRETARIAL AUTHORITY.—The Secretary 

12 of Health and Human Services, in consultation with 

13 the Secretary, shall prescribe rules setting forth the 

14 methods by which calculations of family size and 

15 household income are made for purposes of this sub16 section. Such rules shall be designed to ensure that 

17 the least burden is placed on individuals enrolling in 

18 qualified health plans through an Exchange and tax19 payers eligible for the credit allowable under this 

20 section. 

21 ‘‘(f) RECONCILIATION OF CREDIT AND ADVANCE

22 CREDIT.— 

23 ‘‘(1) IN GENERAL.—The amount of the credit 

24 allowed under this section for any taxable year shall 

25 be reduced (but not below zero) by the amount of 


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•AMDT. NO. 2786 

1 any advance payment of such credit under section 

2 1412 of the Patient Protection and Affordable Care 

3 Act. 

4 ‘‘(2) EXCESS ADVANCE PAYMENTS.— 

5 ‘‘(A) IN GENERAL.—If the advance pay6 ments to a taxpayer under section 1412 of the 

7 Patient Protection and Affordable Care Act for 

8 a taxable year exceed the credit allowed by this 

9 section (determined without regard to para10 graph (1)), the tax imposed by this chapter for 

11 the taxable year shall be increased by the 

12 amount of such excess. 

13 ‘‘(B) LIMITATION ON INCREASE WHERE

14 INCOME LESS THAN 400 PERCENT OF POVERTY

15 LINE.— 

16 ‘‘(i) IN GENERAL.—In the case of an 

17 applicable taxpayer whose household in18 come is less than 400 percent of the pov19 erty line for the size of the family involved 

20 for the taxable year, the amount of the in21 crease under subparagraph (A) shall in no 

22 event exceed $400 ($250 in the case of a 

23 taxpayer whose tax is determined under 

24 section 1(c) for the taxable year). 


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1 ‘‘(ii) INDEXING OF AMOUNT.—In the 

2 case of any calendar year beginning after 

3 2014, each of the dollar amounts under 

4 clause (i) shall be increased by an amount 

5 equal to— 

6 ‘‘(I) such dollar amount, multi7 plied by 

8 ‘‘(II) the cost-of-living adjust9 ment determined under section 1(f)(3) 

10 for the calendar year, determined by 

11 substituting ‘calendar year 2013’ for 

12 ‘calendar year 1992’ in subparagraph 

13 (B) thereof. 

14 If the amount of any increase under clause 

15 (i) is not a multiple of $50, such increase 

16 shall be rounded to the next lowest mul17 tiple of $50. 

18 ‘‘(g) REGULATIONS.—The Secretary shall prescribe 

19 such regulations as may be necessary to carry out the pro20 visions of this section, including regulations which provide 

21 for— 

22 ‘‘(1) the coordination of the credit allowed 

23 under this section with the program for advance 

24 payment of the credit under section 1412 of the Pa25 tient Protection and Affordable Care Act, and 


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•AMDT. NO. 2786 

1 ‘‘(2) the application of subsection (f) where the 

2 filing status of the taxpayer for a taxable year is dif3 ferent from such status used for determining the ad4 vance payment of the credit.’’. 

5 (b) DISALLOWANCE OF DEDUCTION.—Section 280C 

6 of the Internal Revenue Code of 1986 is amended by add7 ing at the end the following new subsection: 

8 ‘‘(g) CREDIT FOR HEALTH INSURANCE PREMIUMS.— 

9 No deduction shall be allowed for the portion of the pre10 miums paid by the taxpayer for coverage of 1 or more 

11 individuals under a qualified health plan which is equal 

12 to the amount of the credit determined for the taxable 

13 year under section 36B(a) with respect to such pre14 miums.’’. 

15 (c) STUDY ON AFFORDABLE COVERAGE.— 

16 (1) STUDY AND REPORT.— 

17 (A) IN GENERAL.—Not later than 5 years 

18 after the date of the enactment of this Act, the 

19 Comptroller General shall conduct a study on 

20 the affordability of health insurance coverage, 

21 including— 

22 (i) the impact of the tax credit for 

23 qualified health insurance coverage of indi24 viduals under section 36B of the Internal 

25 Revenue Code of 1986 and the tax credit 


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•AMDT. NO. 2786 

1 for employee health insurance expenses of 

2 small employers under section 45R of such 

3 Code on maintaining and expanding the 

4 health insurance coverage of individuals; 

5 (ii) the availability of affordable 

6 health benefits plans, including a study of 

7 whether the percentage of household in8 come used for purposes of section 

9 36B(c)(2)(C) of the Internal Revenue Code 

10 of 1986 (as added by this section) is the 

11 appropriate level for determining whether 

12 employer-provided coverage is affordable 

13 for an employee and whether such level 

14 may be lowered without significantly in15 creasing the costs to the Federal Govern16 ment and reducing employer-provided cov17 erage; and 

18 (iii) the ability of individuals to main19 tain essential health benefits coverage (as 

20 defined in section 5000A(f) of the Internal 

21 Revenue Code of 1986). 

22 (B) REPORT.—The Comptroller General 

23 shall submit to the appropriate committees of 

24 Congress a report on the study conducted under 

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•AMDT. NO. 2786 

1 ommendations relating to the matters studied 

2 under such subparagraph. 

3 (2) APPROPRIATE COMMITTEES OF CON4 GRESS.—In this subsection, the term ‘‘appropriate 

5 committees of Congress’’ means the Committee on 

6 Ways and Means, the Committee on Education and 

7 Labor, and the Committee on Energy and Com8 merce of the House of Representatives and the Com9 mittee on Finance and the Committee on Health, 

10 Education, Labor and Pensions of the Senate. 

11 (d) CONFORMING AMENDMENTS.— 

12 (1) Paragraph (2) of section 1324(b) of title 

13 31, United States Code, is amended by inserting 

14 ‘‘36B,’’ after ‘‘36A,’’. 

15 (2) The table of sections for subpart C of part 

16 IV of subchapter A of chapter 1 of the Internal Rev17 enue Code of 1986 is amended by inserting after the 

18 item relating to section 36A the following new item: 

‘‘Sec. 36B. Refundable credit for coverage under a qualified health plan.’’. 

19 (e) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to taxable years ending after De21 cember 31, 2013. 

22 SEC. 1402. REDUCED COST-SHARING FOR INDIVIDUALS EN23 ROLLING IN QUALIFIED HEALTH PLANS. 

24 (a) IN GENERAL.—In the case of an eligible insured 

25 enrolled in a qualified health plan— 


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1 (1) the Secretary shall notify the issuer of the 

2 plan of such eligibility; and 

3 (2) the issuer shall reduce the cost-sharing 

4 under the plan at the level and in the manner speci5 fied in subsection (c). 

6 (b) ELIGIBLE INSURED.—In this section, the term 

7 ‘‘eligible insured’’ means an individual— 

8 (1) who enrolls in a qualified health plan in the 

9 silver level of coverage in the individual market of10 fered through an Exchange; and 

11 (2) whose household income exceeds 100 per12 cent but does not exceed 400 percent of the poverty 

13 line for a family of the size involved. 

14 In the case of an individual described in section 

15 36B(c)(1)(B) of the Internal Revenue Code of 1986, the 

16 individual shall be treated as having household income 

17 equal to 100 percent for purposes of applying this section. 

18 (c) DETERMINATION OF REDUCTION IN COST-SHAR19 ING.— 

20 (1) REDUCTION IN OUT-OF-POCKET LIMIT.— 

21 (A) IN GENERAL.—The reduction in cost22 sharing under this subsection shall first be 

23 achieved by reducing the applicable out-of pock24 et limit under section 1302(c)(1) in the case 

25 of— 


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1 (i) an eligible insured whose household 

2 income is more than 100 percent but not 

3 more than 200 percent of the poverty line 

4 for a family of the size involved, by two5 thirds; 

6 (ii) an eligible insured whose house7 hold income is more than 200 percent but 

8 not more than 300 percent of the poverty 

9 line for a family of the size involved, by 

10 one-half; and 

11 (iii) an eligible insured whose house12 hold income is more than 300 percent but 

13 not more than 400 percent of the poverty 

14 line for a family of the size involved, by 

15 one-third. 

16 (B) COORDINATION WITH ACTUARIAL

17 VALUE LIMITS.— 

18 (i) IN GENERAL.—The Secretary shall 

19 ensure the reduction under this paragraph 

20 shall not result in an increase in the plan’s 

21 share of the total allowed costs of benefits 

22 provided under the plan above— 

23 (I) 90 percent in the case of an 

24 eligible insured described in para25 graph (2)(A); 


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1 (II) 80 percent in the case of an 

2 eligible insured described in para3 graph (2)(B); and 

4 (III) 70 percent in the case of an 

5 eligible insured described in clause (ii) 

6 or (iii) of subparagraph (A). 

7 (ii) ADJUSTMENT.—The Secretary 

8 shall adjust the out-of pocket limits under 

9 paragraph (1) if necessary to ensure that 

10 such limits do not cause the respective ac11 tuarial values to exceed the levels specified 

12 in clause (i). 

13 (2) ADDITIONAL REDUCTION FOR LOWER IN14 COME INSUREDS.—The Secretary shall establish pro15 cedures under which the issuer of a qualified health 

16 plan to which this section applies shall further re17 duce cost-sharing under the plan in a manner suffi18 cient to— 

19 (A) in the case of an eligible insured whose 

20 household income is not less than 100 percent 

21 but not more than 150 percent of the poverty 

22 line for a family of the size involved, increase 

23 the plan’s share of the total allowed costs of 

24 benefits provided under the plan to 90 percent 

25 of such costs; and 


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1 (B) in the case of an eligible insured whose 

2 household income is more than 150 percent but 

3 not more than 200 percent of the poverty line 

4 for a family of the size involved, increase the 

5 plan’s share of the total allowed costs of bene6 fits provided under the plan to 80 percent of 

7 such costs. 

8 (3) METHODS FOR REDUCING COST-SHARING.— 

9 (A) IN GENERAL.—An issuer of a qualified 

10 health plan making reductions under this sub11 section shall notify the Secretary of such reduc12 tions and the Secretary shall make periodic and 

13 timely payments to the issuer equal to the value 

14 of the reductions. 

15 (B) CAPITATED PAYMENTS.—The Sec16 retary may establish a capitated payment sys17 tem to carry out the payment of cost-sharing 

18 reductions under this section. Any such system 

19 shall take into account the value of the reduc20 tions and make appropriate risk adjustments to 

21 such payments. 

22 (4) ADDITIONAL BENEFITS.—If a qualified 

23 health plan under section 1302(b)(5) offers benefits 

24 in addition to the essential health benefits required 

25 to be provided by the plan, or a State requires a 


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1 qualified health plan under section 1311(d)(3)(B) to 

2 cover benefits in addition to the essential health ben3 efits required to be provided by the plan, the reduc4 tions in cost-sharing under this section shall not 

5 apply to such additional benefits. 

6 (5) SPECIAL RULE FOR PEDIATRIC DENTAL

7 PLANS.—If an individual enrolls in both a qualified 

8 health plan and a plan described in section 

9 1311(d)(2)(B)(ii)(I) for any plan year, subsection 

10 (a) shall not apply to that portion of any reduction 

11 in cost-sharing under subsection (c) that (under reg12 ulations prescribed by the Secretary) is properly al13 locable to pediatric dental benefits which are in14 cluded in the essential health benefits required to be 

15 provided by a qualified health plan under section 

16 1302(b)(1)(J). 

17 (d) SPECIAL RULES FOR INDIANS.— 

18 (1) INDIANS UNDER 300 PERCENT OF POV19 ERTY.—If an individual enrolled in any qualified 

20 health plan in the individual market through an Ex21 change is an Indian (as defined in section 4(d) of 

22 the Indian Self-Determination and Education Assist23 ance Act (25 U.S.C. 450b(d))) whose household in24 come is not more than 300 percent of the poverty 


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1 line for a family of the size involved, then, for pur2 poses of this section— 

3 (A) such individual shall be treated as an 

4 eligible insured; and 

5 (B) the issuer of the plan shall eliminate 

6 any cost-sharing under the plan. 

7 (2) ITEMS OR SERVICES FURNISHED THROUGH

8 INDIAN HEALTH PROVIDERS.—If an Indian (as so 

9 defined) enrolled in a qualified health plan is fur10 nished an item or service directly by the Indian 

11 Health Service, an Indian Tribe, Tribal Organiza12 tion, or Urban Indian Organization or through refer13 ral under contract health services— 

14 (A) no cost-sharing under the plan shall be 

15 imposed under the plan for such item or serv16 ice; and 

17 (B) the issuer of the plan shall not reduce 

18 the payment to any such entity for such item 

19 or service by the amount of any cost-sharing 

20 that would be due from the Indian but for sub21 paragraph (A). 

22 (3) PAYMENT.—The Secretary shall pay to the 

23 issuer of a qualified health plan the amount nec24 essary to reflect the increase in actuarial value of 

25 the plan required by reason of this subsection. 


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1 (e) RULES FOR INDIVIDUALS NOT LAWFULLY

2 PRESENT.— 

3 (1) IN GENERAL.—If an individual who is an el4 igible insured is not lawfully present— 

5 (A) no cost-sharing reduction under this 

6 section shall apply with respect to the indi7 vidual; and 

8 (B) for purposes of applying this section, 

9 the determination as to what percentage a tax10 payer’s household income bears to the poverty 

11 level for a family of the size involved shall be 

12 made under one of the following methods: 

13 (i) A method under which— 

14 (I) the taxpayer’s family size is 

15 determined by not taking such indi16 viduals into account, and 

17 (II) the taxpayer’s household in18 come is equal to the product of the 

19 taxpayer’s household income (deter20 mined without regard to this sub21 section) and a fraction— 

22 (aa) the numerator of which 

23 is the poverty line for the tax24 payer’s family size determined 


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1 after application of subclause (I), 

2 and 

3 (bb) the denominator of 

4 which is the poverty line for the 

5 taxpayer’s family size determined 

6 without regard to subclause (I). 

7 (ii) A comparable method reaching the 

8 same result as the method under clause (i). 

9 (2) LAWFULLY PRESENT.—For purposes of this 

10 section, an individual shall be treated as lawfully 

11 present only if the individual is, and is reasonably 

12 expected to be for the entire period of enrollment for 

13 which the cost-sharing reduction under this section 

14 is being claimed, a citizen or national of the United 

15 States or an alien lawfully present in the United 

16 States. 

17 (3) SECRETARIAL AUTHORITY.—The Secretary, 

18 in consultation with the Secretary of the Treasury, 

19 shall prescribe rules setting forth the methods by 

20 which calculations of family size and household in21 come are made for purposes of this subsection. Such 

22 rules shall be designed to ensure that the least bur23 den is placed on individuals enrolling in qualified 

24 health plans through an Exchange and taxpayers eli25 gible for the credit allowable under this section. 


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1 (f) DEFINITIONS AND SPECIAL RULES.—In this sec2 tion: 

3 (1) IN GENERAL.—Any term used in this sec4 tion which is also used in section 36B of the Inter5 nal Revenue Code of 1986 shall have the meaning 

6 given such term by such section. 

7 (2) LIMITATIONS ON REDUCTION.—No cost8 sharing reduction shall be allowed under this section 

9 with respect to coverage for any month unless the 

10 month is a coverage month with respect to which a 

11 credit is allowed to the insured (or an applicable tax12 payer on behalf of the insured) under section 36B 

13 of such Code. 

14 (3) DATA USED FOR ELIGIBILITY.—Any deter15 mination under this section shall be made on the 

16 basis of the taxable year for which the advance de17 termination is made under section 1412 and not the 

18 taxable year for which the credit under section 36B 

19 of such Code is allowed. 


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1 Subpart B—Eligibility Determinations 

2 SEC. 1411. PROCEDURES FOR DETERMINING ELIGIBILITY 

3 FOR EXCHANGE PARTICIPATION, PREMIUM 

4 TAX CREDITS AND REDUCED COST-SHARING , 

5 AND INDIVIDUAL RESPONSIBILITY EXEMP6 TIONS. 

7 (a) ESTABLISHMENT OF PROGRAM.—The Secretary 

8 shall establish a program meeting the requirements of this 

9 section for determining— 

10 (1) whether an individual who is to be covered 

11 in the individual market by a qualified health plan 

12 offered through an Exchange, or who is claiming a 

13 premium tax credit or reduced cost-sharing, meets 

14 the requirements of sections 1312(f)(3), 1402(e), 

15 and 1412(d) of this title and section 36B(e) of the 

16 Internal Revenue Code of 1986 that the individual 

17 be a citizen or national of the United States or an 

18 alien lawfully present in the United States; 

19 (2) in the case of an individual claiming a pre20 mium tax credit or reduced cost-sharing under sec21 tion 36B of such Code or section 1402— 

22 (A) whether the individual meets the in23 come and coverage requirements of such sec24 tions; and 

25 (B) the amount of the tax credit or re26 duced cost-sharing; 


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1 (3) whether an individual’s coverage under an 

2 employer-sponsored health benefits plan is treated as 

3 unaffordable under sections 36B(c)(2)(C) and 

4 5000A(e)(2); and 

5 (4) whether to grant a certification under sec6 tion 1311(d)(4)(H) attesting that, for purposes of 

7 the individual responsibility requirement under sec8 tion 5000A of the Internal Revenue Code of 1986, 

9 an individual is entitled to an exemption from either 

10 the individual responsibility requirement or the pen11 alty imposed by such section. 

12 (b) INFORMATION REQUIRED TO BE PROVIDED BY

13 APPLICANTS.— 

14 (1) IN GENERAL.—An applicant for enrollment 

15 in a qualified health plan offered through an Ex16 change in the individual market shall provide— 

17 (A) the name, address, and date of birth of 

18 each individual who is to be covered by the plan 

19 (in this subsection referred to as an ‘‘enrollee’’); 

20 and 

21 (B) the information required by any of the 

22 following paragraphs that is applicable to an 

23 enrollee. 


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1 (2) CITIZENSHIP OR IMMIGRATION STATUS.— 

2 The following information shall be provided with re3 spect to every enrollee: 

4 (A) In the case of an enrollee whose eligi5 bility is based on an attestation of citizenship of 

6 the enrollee, the enrollee’s social security num7 ber. 

8 (B) In the case of an individual whose eli9 gibility is based on an attestation of the enroll10 ee’s immigration status, the enrollee’s social se11 curity number (if applicable) and such identi12 fying information with respect to the enrollee’s 

13 immigration status as the Secretary, after con14 sultation with the Secretary of Homeland Secu15 rity, determines appropriate. 

16 (3) ELIGIBILITY AND AMOUNT OF TAX CREDIT

17 OR REDUCED COST-SHARING.—In the case of an en18 rollee with respect to whom a premium tax credit or 

19 reduced cost-sharing under section 36B of such 

20 Code or section 1402 is being claimed, the following 

21 information: 

22 (A) INFORMATION REGARDING INCOME

23 AND FAMILY SIZE.—The information described 

24 in section 6103(l)(21) for the taxable year end25 ing with or within the second calendar year preVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00271 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ceding the calendar year in which the plan year 

2 begins. 

3 (B) CHANGES IN CIRCUMSTANCES.—The 

4 information described in section 1412(b)(2), in5 cluding information with respect to individuals 

6 who were not required to file an income tax re7 turn for the taxable year described in subpara8 graph (A) or individuals who experienced 

9 changes in marital status or family size or sig10 nificant reductions in income. 

11 (4) EMPLOYER-SPONSORED COVERAGE.—In the 

12 case of an enrollee with respect to whom eligibility 

13 for a premium tax credit under section 36B of such 

14 Code or cost-sharing reduction under section 1402 is 

15 being established on the basis that the enrollee’s (or 

16 related individual’s) employer is not treated under 

17 section 36B(c)(2)(C) of such Code as providing min18 imum essential coverage or affordable minimum es19 sential coverage, the following information: 

20 (A) The name, address, and employer iden21 tification number (if available) of the employer. 

22 (B) Whether the enrollee or individual is a 

23 full-time employee and whether the employer 

24 provides such minimum essential coverage. 


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1 (C) If the employer provides such min2 imum essential coverage, the lowest cost option 

3 for the enrollee’s or individual’s enrollment sta4 tus and the enrollee’s or individual’s required 

5 contribution (within the meaning of section 

6 5000A(e)(1)(B) of such Code) under the em7 ployer-sponsored plan. 

8 (D) If an enrollee claims an employer’s 

9 minimum essential coverage is unaffordable, the 

10 information described in paragraph (3). 

11 If an enrollee changes employment or obtains addi12 tional employment while enrolled in a qualified 

13 health plan for which such credit or reduction is al14 lowed, the enrollee shall notify the Exchange of such 

15 change or additional employment and provide the in16 formation described in this paragraph with respect 

17 to the new employer. 

18 (5) EXEMPTIONS FROM INDIVIDUAL RESPONSI19 BILITY REQUIREMENTS.—In the case of an indi20 vidual who is seeking an exemption certificate under 

21 section 1311(d)(4)(H) from any requirement or pen22 alty imposed by section 5000A, the following infor23 mation: 

24 (A) In the case of an individual seeking ex25 emption based on the individual’s status as a 


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•AMDT. NO. 2786 

1 member of an exempt religious sect or division, 

2 as a member of a health care sharing ministry, 

3 as an Indian, or as an individual eligible for a 

4 hardship exemption, such information as the 

5 Secretary shall prescribe. 

6 (B) In the case of an individual seeking ex7 emption based on the lack of affordable cov8 erage or the individual’s status as a taxpayer 

9 with household income less than 100 percent of 

10 the poverty line, the information described in 

11 paragraphs (3) and (4), as applicable. 

12 (c) VERIFICATION OF INFORMATION CONTAINED IN

13 RECORDS OF SPECIFIC FEDERAL OFFICIALS.— 

14 (1) INFORMATION TRANSFERRED TO SEC15 RETARY.—An Exchange shall submit the informa16 tion provided by an applicant under subsection (b) 

17 to the Secretary for verification in accordance with 

18 the requirements of this subsection and subsection 

19 (d). 

20 (2) CITIZENSHIP OR IMMIGRATION STATUS.— 

21 (A) COMMISSIONER OF SOCIAL SECU22 RITY.—The Secretary shall submit to the Com23 missioner of Social Security the following infor24 mation for a determination as to whether the 


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1 information provided is consistent with the in2 formation in the records of the Commissioner: 

3 (i) The name, date of birth, and social 

4 security number of each individual for 

5 whom such information was provided 

6 under subsection (b)(2). 

7 (ii) The attestation of an individual 

8 that the individual is a citizen. 

9 (B) SECRETARY OF HOMELAND SECU10 RITY.— 

11 (i) IN GENERAL.—In the case of an 

12 individual— 

13 (I) who attests that the indi14 vidual is an alien lawfully present in 

15 the United States; or 

16 (II) who attests that the indi17 vidual is a citizen but with respect to 

18 whom the Commissioner of Social Se19 curity has notified the Secretary 

20 under subsection (e)(3) that the attes21 tation is inconsistent with information 

22 in the records maintained by the 

23 Commissioner; 

24 the Secretary shall submit to the Secretary 

25 of Homeland Security the information deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00275 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 scribed in clause (ii) for a determination as 

2 to whether the information provided is con3 sistent with the information in the records 

4 of the Secretary of Homeland Security. 

5 (ii) INFORMATION.—The information 

6 described in clause (ii) is the following: 

7 (I) The name, date of birth, and 

8 any identifying information with re9 spect to the individual’s immigration 

10 status provided under subsection 

11 (b)(2). 

12 (II) The attestation that the indi13 vidual is an alien lawfully present in 

14 the United States or in the case of an 

15 individual described in clause (i)(II), 

16 the attestation that the individual is a 

17 citizen. 

18 (3) ELIGIBILITY FOR TAX CREDIT AND COST19 SHARING REDUCTION.—The Secretary shall submit 

20 the information described in subsection (b)(3)(A) 

21 provided under paragraph (3), (4), or (5) of sub22 section (b) to the Secretary of the Treasury for 

23 verification of household income and family size for 

24 purposes of eligibility. 

25 (4) METHODS.— 


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•AMDT. NO. 2786 

1 (A) IN GENERAL.—The Secretary, in con2 sultation with the Secretary of the Treasury, 

3 the Secretary of Homeland Security, and the 

4 Commissioner of Social Security, shall provide 

5 that verifications and determinations under this 

6 subsection shall be done— 

7 (i) through use of an on-line system 

8 or otherwise for the electronic submission 

9 of, and response to, the information sub10 mitted under this subsection with respect 

11 to an applicant; or 

12 (ii) by determining the consistency of 

13 the information submitted with the infor14 mation maintained in the records of the 

15 Secretary of the Treasury, the Secretary of 

16 Homeland Security, or the Commissioner 

17 of Social Security through such other 

18 method as is approved by the Secretary. 

19 (B) FLEXIBILITY.—The Secretary may 

20 modify the methods used under the program es21 tablished by this section for the Exchange and 

22 verification of information if the Secretary de23 termines such modifications would reduce the 

24 administrative costs and burdens on the appli25 cant, including allowing an applicant to request 


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1 the Secretary of the Treasury to provide the in2 formation described in paragraph (3) directly to 

3 the Exchange or to the Secretary. The Sec4 retary shall not make any such modification un5 less the Secretary determines that any applica6 ble requirements under this section and section 

7 6103 of the Internal Revenue Code of 1986 

8 with respect to the confidentiality, disclosure, 

9 maintenance, or use of information will be met. 

10 (d) VERIFICATION BY SECRETARY.—In the case of 

11 information provided under subsection (b) that is not re12 quired under subsection (c) to be submitted to another 

13 person for verification, the Secretary shall verify the accu14 racy of such information in such manner as the Secretary 

15 determines appropriate, including delegating responsibility 

16 for verification to the Exchange. 

17 (e) ACTIONS RELATING TO VERIFICATION.— 

18 (1) IN GENERAL.—Each person to whom the 

19 Secretary provided information under subsection (c) 

20 shall report to the Secretary under the method es21 tablished under subsection (c)(4) the results of its 

22 verification and the Secretary shall notify the Ex23 change of such results. Each person to whom the 

24 Secretary provided information under subsection (d) 


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1 shall report to the Secretary in such manner as the 

2 Secretary determines appropriate. 

3 (2) VERIFICATION.— 

4 (A) ELIGIBILITY FOR ENROLLMENT AND

5 PREMIUM TAX CREDITS AND COST-SHARING RE6 DUCTIONS.—If information provided by an ap7 plicant under paragraphs (1), (2), (3), and (4) 

8 of subsection (b) is verified under subsections 

9 (c) and (d)— 

10 (i) the individual’s eligibility to enroll 

11 through the Exchange and to apply for 

12 premium tax credits and cost-sharing re13 ductions shall be satisfied; and 

14 (ii) the Secretary shall, if applicable, 

15 notify the Secretary of the Treasury under 

16 section 1412(c) of the amount of any ad17 vance payment to be made. 

18 (B) EXEMPTION FROM INDIVIDUAL RE19 SPONSIBILITY.—If information provided by an 

20 applicant under subsection (b)(5) is verified 

21 under subsections (c) and (d), the Secretary 

22 shall issue the certification of exemption de23 scribed in section 1311(d)(4)(H). 

24 (3) INCONSISTENCIES INVOLVING ATTESTATION

25 OF CITIZENSHIP OR LAWFUL PRESENCE.—If the inVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00279 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 formation provided by any applicant under sub2 section (b)(2) is inconsistent with information in the 

3 records maintained by the Commissioner of Social 

4 Security or Secretary of Homeland Security, which5 ever is applicable, the applicant’s eligibility will be 

6 determined in the same manner as an individual’s 

7 eligibility under the medicaid program is determined 

8 under section 1902(ee) of the Social Security Act (as 

9 in effect on January 1, 2010). 

10 (4) INCONSISTENCIES INVOLVING OTHER IN11 FORMATION.— 

12 (A) IN GENERAL.—If the information pro13 vided by an applicant under subsection (b) 

14 (other than subsection (b)(2)) is inconsistent 

15 with information in the records maintained by 

16 persons under subsection (c) or is not verified 

17 under subsection (d), the Secretary shall notify 

18 the Exchange and the Exchange shall take the 

19 following actions: 

20 (i) REASONABLE EFFORT.—The Ex21 change shall make a reasonable effort to 

22 identify and address the causes of such in23 consistency, including through typo24 graphical or other clerical errors, by con25 tacting the applicant to confirm the accuVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00280 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 racy of the information, and by taking 

2 such additional actions as the Secretary, 

3 through regulation or other guidance, may 

4 identify. 

5 (ii) NOTICE AND OPPORTUNITY TO

6 CORRECT.—In the case the inconsistency 

7 or inability to verify is not resolved under 

8 subparagraph (A), the Exchange shall— 

9 (I) notify the applicant of such 

10 fact; 

11 (II) provide the applicant an op12 portunity to either present satisfac13 tory documentary evidence or resolve 

14 the inconsistency with the person 

15 verifying the information under sub16 section (c) or (d) during the 90-day 

17 period beginning the date on which 

18 the notice required under subclause 

19 (I) is sent to the applicant. 

20 The Secretary may extend the 90-day pe21 riod under subclause (II) for enrollments 

22 occurring during 2014. 

23 (B) SPECIFIC ACTIONS NOT INVOLVING

24 CITIZENSHIP OR LAWFUL PRESENCE.— 


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1 (i) IN GENERAL.—Except as provided 

2 in paragraph (3), the Exchange shall, dur3 ing any period before the close of the pe4 riod under subparagraph (A)(ii)(II), make 

5 any determination under paragraphs (2), 

6 (3), and (4) of subsection (a) on the basis 

7 of the information contained on the appli8 cation. 

9 (ii) ELIGIBILITY OR AMOUNT OF

10 CREDIT OR REDUCTION.—If an inconsist11 ency involving the eligibility for, or amount 

12 of, any premium tax credit or cost-sharing 

13 reduction is unresolved under this sub14 section as of the close of the period under 

15 subparagraph (A)(ii)(II), the Exchange 

16 shall notify the applicant of the amount (if 

17 any) of the credit or reduction that is de18 termined on the basis of the records main19 tained by persons under subsection (c). 

20 (iii) EMPLOYER AFFORDABILITY.—If 

21 the Secretary notifies an Exchange that an 

22 enrollee is eligible for a premium tax credit 

23 under section 36B of such Code or cost24 sharing reduction under section 1402 be25 cause the enrollee’s (or related individVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00282 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ual’s) employer does not provide minimum 

2 essential coverage through an employer3 sponsored plan or that the employer does 

4 provide that coverage but it is not afford5 able coverage, the Exchange shall notify 

6 the employer of such fact and that the em7 ployer may be liable for the payment as8 sessed under section 4980H of such Code. 

9 (iv) EXEMPTION.—In any case where 

10 the inconsistency involving, or inability to 

11 verify, information provided under sub12 section (b)(5) is not resolved as of the 

13 close of the period under subparagraph 

14 (A)(ii)(II), the Exchange shall notify an 

15 applicant that no certification of exemption 

16 from any requirement or payment under 

17 section 5000A of such Code will be issued. 

18 (C) APPEALS PROCESS.—The Exchange 

19 shall also notify each person receiving notice 

20 under this paragraph of the appeals processes 

21 established under subsection (f). 

22 (f) APPEALS AND REDETERMINATIONS.— 

23 (1) IN GENERAL.—The Secretary, in consulta24 tion with the Secretary of the Treasury, the Sec25 retary of Homeland Security, and the Commissioner 


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1 of Social Security, shall establish procedures by 

2 which the Secretary or one of such other Federal of3 ficers— 

4 (A) hears and makes decisions with respect 

5 to appeals of any determination under sub6 section (e); and 

7 (B) redetermines eligibility on a periodic 

8 basis in appropriate circumstances. 

9 (2) EMPLOYER LIABILITY.— 

10 (A) IN GENERAL.—The Secretary shall es11 tablish a separate appeals process for employers 

12 who are notified under subsection (e)(4)(C) that 

13 the employer may be liable for a tax imposed by 

14 section 4980H of the Internal Revenue Code of 

15 1986 with respect to an employee because of a 

16 determination that the employer does not pro17 vide minimum essential coverage through an 

18 employer-sponsored plan or that the employer 

19 does provide that coverage but it is not afford20 able coverage with respect to an employee. Such 

21 process shall provide an employer the oppor22 tunity to— 

23 (i) present information to the Ex24 change for review of the determination ei25 ther by the Exchange or the person makVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00284 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ing the determination, including evidence 

2 of the employer-sponsored plan and em3 ployer contributions to the plan; and 

4 (ii) have access to the data used to 

5 make the determination to the extent al6 lowable by law. 

7 Such process shall be in addition to any rights 

8 of appeal the employer may have under subtitle 

9 F of such Code. 

10 (B) CONFIDENTIALITY.—Notwithstanding 

11 any provision of this title (or the amendments 

12 made by this title) or section 6103 of the Inter13 nal Revenue Code of 1986, an employer shall 

14 not be entitled to any taxpayer return informa15 tion with respect to an employee for purposes of 

16 determining whether the employer is subject to 

17 the penalty under section 4980H of such Code 

18 with respect to the employee, except that— 

19 (i) the employer may be notified as to 

20 the name of an employee and whether or 

21 not the employee’s income is above or 

22 below the threshold by which the afford23 ability of an employer’s health insurance 

24 coverage is measured; and 


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1 (ii) this subparagraph shall not apply 

2 to an employee who provides a waiver (at 

3 such time and in such manner as the Sec4 retary may prescribe) authorizing an em5 ployer to have access to the employee’s tax6 payer return information. 

7 (g) CONFIDENTIALITY OF APPLICANT INFORMA8 TION.— 

9 (1) IN GENERAL.—An applicant for insurance 

10 coverage or for a premium tax credit or cost-sharing 

11 reduction shall be required to provide only the infor12 mation strictly necessary to authenticate identity, 

13 determine eligibility, and determine the amount of 

14 the credit or reduction. 

15 (2) RECEIPT OF INFORMATION.—Any person 

16 who receives information provided by an applicant 

17 under subsection (b) (whether directly or by another 

18 person at the request of the applicant), or receives 

19 information from a Federal agency under subsection 

20 (c), (d), or (e), shall— 

21 (A) use the information only for the pur22 poses of, and to the extent necessary in, ensur23 ing the efficient operation of the Exchange, in24 cluding verifying the eligibility of an individual 

25 to enroll through an Exchange or to claim a 


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1 premium tax credit or cost-sharing reduction or 

2 the amount of the credit or reduction; and 

3 (B) not disclose the information to any 

4 other person except as provided in this section. 

5 (h) PENALTIES.— 

6 (1) FALSE OR FRAUDULENT INFORMATION.— 

7 (A) CIVIL PENALTY.— 

8 (i) IN GENERAL.—If— 

9 (I) any person fails to provides 

10 correct information under subsection 

11 (b); and 

12 (II) such failure is attributable to 

13 negligence or disregard of any rules or 

14 regulations of the Secretary, 

15 such person shall be subject, in addition to 

16 any other penalties that may be prescribed 

17 by law, to a civil penalty of not more than 

18 $25,000 with respect to any failures involv19 ing an application for a plan year. For 

20 purposes of this subparagraph, the terms 

21 ‘‘negligence’’ and ‘‘disregard’’ shall have 

22 the same meanings as when used in section 

23 6662 of the Internal Revenue Code of 

24 1986. 


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1 (ii) REASONABLE CAUSE EXCEP2 TION.—No penalty shall be imposed under 

3 clause (i) if the Secretary determines that 

4 there was a reasonable cause for the fail5 ure and that the person acted in good 

6 faith. 

7 (B) KNOWING AND WILLFUL VIOLA8 TIONS.—Any person who knowingly and will9 fully provides false or fraudulent information 

10 under subsection (b) shall be subject, in addi11 tion to any other penalties that may be pre12 scribed by law, to a civil penalty of not more 

13 than $250,000. 

14 (2) IMPROPER USE OR DISCLOSURE OF INFOR15 MATION.—Any person who knowingly and willfully 

16 uses or discloses information in violation of sub17 section (g) shall be subject, in addition to any other 

18 penalties that may be prescribed by law, to a civil 

19 penalty of not more than $25,000. 

20 (3) LIMITATIONS ON LIENS AND LEVIES.—The 

21 Secretary (or, if applicable, the Attorney General of 

22 the United States) shall not— 

23 (A) file notice of lien with respect to any 

24 property of a person by reason of any failure to 

25 pay the penalty imposed by this subsection; or 


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1 (B) levy on any such property with respect 

2 to such failure. 

3 (i) STUDY OF ADMINISTRATION OF EMPLOYER RE4 SPONSIBILITY.— 

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

6 Human Services shall, in consultation with the Sec7 retary of the Treasury, conduct a study of the proce8 dures that are necessary to ensure that in the ad9 ministration of this title and section 4980H of the 

10 Internal Revenue Code of 1986 (as added by section 

11 1513) that the following rights are protected: 

12 (A) The rights of employees to preserve 

13 their right to confidentiality of their taxpayer 

14 return information and their right to enroll in 

15 a qualified health plan through an Exchange if 

16 an employer does not provide affordable cov17 erage. 

18 (B) The rights of employers to adequate 

19 due process and access to information necessary 

20 to accurately determine any payment assessed 

21 on employers. 

22 (2) REPORT.—Not later than January 1, 2013, 

23 the Secretary of Health and Human Services shall 

24 report the results of the study conducted under 

25 paragraph (1), including any recommendations for 


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1 legislative changes, to the Committees on Finance 

2 and Health, Education, Labor and Pensions of the 

3 Senate and the Committees of Education and Labor 

4 and Ways and Means of the House of Representa5 tives. 

6 SEC. 1412. ADVANCE DETERMINATION AND PAYMENT OF 

7 PREMIUM TAX CREDITS AND COST-SHARING 

8 REDUCTIONS. 

9 (a) IN GENERAL.—The Secretary, in consultation 

10 with the Secretary of the Treasury, shall establish a pro11 gram under which— 

12 (1) upon request of an Exchange, advance de13 terminations are made under section 1411 with re14 spect to the income eligibility of individuals enrolling 

15 in a qualified health plan in the individual market 

16 through the Exchange for the premium tax credit al17 lowable under section 36B of the Internal Revenue 

18 Code of 1986 and the cost-sharing reductions under 

19 section 1402; 

20 (2) the Secretary notifies— 

21 (A) the Exchange and the Secretary of the 

22 Treasury of the advance determinations; and 

23 (B) the Secretary of the Treasury of the 

24 name and employer identification number of 

25 each employer with respect to whom 1 or more 


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1 employee of the employer were determined to be 

2 eligible for the premium tax credit under sec3 tion 36B of the Internal Revenue Code of 1986 

4 and the cost-sharing reductions under section 

5 1402 because— 

6 (i) the employer did not provide min7 imum essential coverage; or 

8 (ii) the employer provided such min9 imum essential coverage but it was deter10 mined under section 36B(c)(2)(C) of such 

11 Code to either be unaffordable to the em12 ployee or not provide the required min13 imum actuarial value; and 

14 (3) the Secretary of the Treasury makes ad15 vance payments of such credit or reductions to the 

16 issuers of the qualified health plans in order to re17 duce the premiums payable by individuals eligible for 

18 such credit. 

19 (b) ADVANCE DETERMINATIONS.— 

20 (1) IN GENERAL.—The Secretary shall provide 

21 under the program established under subsection (a) 

22 that advance determination of eligibility with respect 

23 to any individual shall be made— 

24 (A) during the annual open enrollment pe25 riod applicable to the individual (or such other 


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1 enrollment period as may be specified by the 

2 Secretary); and 

3 (B) on the basis of the individual’s house4 hold income for the most recent taxable year for 

5 which the Secretary, after consultation with the 

6 Secretary of the Treasury, determines informa7 tion is available. 

8 (2) CHANGES IN CIRCUMSTANCES.—The Sec9 retary shall provide procedures for making advance 

10 determinations on the basis of information other 

11 than that described in paragraph (1)(B) in cases 

12 where information included with an application form 

13 demonstrates substantial changes in income, changes 

14 in family size or other household circumstances, 

15 change in filing status, the filing of an application 

16 for unemployment benefits, or other significant 

17 changes affecting eligibility, including— 

18 (A) allowing an individual claiming a de19 crease of 20 percent or more in income, or fil20 ing an application for unemployment benefits, 

21 to have eligibility for the credit determined on 

22 the basis of household income for a later period 

23 or on the basis of the individual’s estimate of 

24 such income for the taxable year; and 


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1 (B) the determination of household income 

2 in cases where the taxpayer was not required to 

3 file a return of tax imposed by this chapter for 

4 the second preceding taxable year. 

5 (c) PAYMENT OF PREMIUM TAX CREDITS AND COST6 SHARING REDUCTIONS.— 

7 (1) IN GENERAL.—The Secretary shall notify 

8 the Secretary of the Treasury and the Exchange 

9 through which the individual is enrolling of the ad10 vance determination under section 1411. 

11 (2) PREMIUM TAX CREDIT.— 

12 (A) IN GENERAL.—The Secretary of the 

13 Treasury shall make the advance payment 

14 under this section of any premium tax credit al15 lowed under section 36B of the Internal Rev16 enue Code of 1986 to the issuer of a qualified 

17 health plan on a monthly basis (or such other 

18 periodic basis as the Secretary may provide). 

19 (B) ISSUER RESPONSIBILITIES.—An issuer 

20 of a qualified health plan receiving an advance 

21 payment with respect to an individual enrolled 

22 in the plan shall— 

23 (i) reduce the premium charged the 

24 insured for any period by the amount of 

25 the advance payment for the period; 


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1 (ii) notify the Exchange and the Sec2 retary of such reduction; 

3 (iii) include with each billing state4 ment the amount by which the premium 

5 for the plan has been reduced by reason of 

6 the advance payment; and 

7 (iv) in the case of any nonpayment of 

8 premiums by the insured— 

9 (I) notify the Secretary of such 

10 nonpayment; and 

11 (II) allow a 3-month grace period 

12 for nonpayment of premiums before 

13 discontinuing coverage. 

14 (3) COST-SHARING REDUCTIONS.—The Sec15 retary shall also notify the Secretary of the Treasury 

16 and the Exchange under paragraph (1) if an ad17 vance payment of the cost-sharing reductions under 

18 section 1402 is to be made to the issuer of any 

19 qualified health plan with respect to any individual 

20 enrolled in the plan. The Secretary of the Treasury 

21 shall make such advance payment at such time and 

22 in such amount as the Secretary specifies in the no23 tice. 

24 (d) NO FEDERAL PAYMENTS FOR INDIVIDUALS NOT

25 LAWFULLY PRESENT.—Nothing in this subtitle or the 


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1 amendments made by this subtitle allows Federal pay2 ments, credits, or cost-sharing reductions for individuals 

3 who are not lawfully present in the United States. 

4 (e) STATE FLEXIBILITY.—Nothing in this subtitle or 

5 the amendments made by this subtitle shall be construed 

6 to prohibit a State from making payments to or on behalf 

7 of an individual for coverage under a qualified health plan 

8 offered through an Exchange that are in addition to any 

9 credits or cost-sharing reductions allowable to the indi10 vidual under this subtitle and such amendments. 

11 SEC. 1413. STREAMLINING OF PROCEDURES FOR ENROLL12 MENT THROUGH AN EXCHANGE AND STATE 

13 MEDICAID, CHIP, AND HEALTH SUBSIDY PRO14 GRAMS. 

15 (a) IN GENERAL.—The Secretary shall establish a 

16 system meeting the requirements of this section under 

17 which residents of each State may apply for enrollment 

18 in, receive a determination of eligibility for participation 

19 in, and continue participation in, applicable State health 

20 subsidy programs. Such system shall ensure that if an in21 dividual applying to an Exchange is found through screen22 ing to be eligible for medical assistance under the State 

23 medicaid plan under title XIX, or eligible for enrollment 

24 under a State children’s health insurance program 


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1 (CHIP) under title XXI of such Act, the individual is en2 rolled for assistance under such plan or program. 

3 (b) REQUIREMENTS RELATING TO FORMS AND NO4 TICE.— 

5 (1) REQUIREMENTS RELATING TO FORMS.— 

6 (A) IN GENERAL.—The Secretary shall de7 velop and provide to each State a single, 

8 streamlined form that— 

9 (i) may be used to apply for all appli10 cable State health subsidy programs within 

11 the State; 

12 (ii) may be filed online, in person, by 

13 mail, or by telephone; 

14 (iii) may be filed with an Exchange or 

15 with State officials operating one of the 

16 other applicable State health subsidy pro17 grams; and 

18 (iv) is structured to maximize an ap19 plicant’s ability to complete the form satis20 factorily, taking into account the charac21 teristics of individuals who qualify for ap22 plicable State health subsidy programs. 

23 (B) STATE AUTHORITY TO ESTABLISH

24 FORM.—A State may develop and use its own 

25 single, streamlined form as an alternative to the 


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1 form developed under subparagraph (A) if the 

2 alternative form is consistent with standards 

3 promulgated by the Secretary under this sec4 tion. 

5 (C) SUPPLEMENTAL ELIGIBILITY

6 FORMS.—The Secretary may allow a State to 

7 use a supplemental or alternative form in the 

8 case of individuals who apply for eligibility that 

9 is not determined on the basis of the household 

10 income (as defined in section 36B of the Inter11 nal Revenue Code of 1986). 

12 (2) NOTICE.—The Secretary shall provide that 

13 an applicant filing a form under paragraph (1) shall 

14 receive notice of eligibility for an applicable State 

15 health subsidy program without any need to provide 

16 additional information or paperwork unless such in17 formation or paperwork is specifically required by 

18 law when information provided on the form is incon19 sistent with data used for the electronic verification 

20 under paragraph (3) or is otherwise insufficient to 

21 determine eligibility. 

22 (c) REQUIREMENTS RELATING TO ELIGIBILITY

23 BASED ON DATA EXCHANGES.— 

24 (1) DEVELOPMENT OF SECURE INTERFACES.— 

25 Each State shall develop for all applicable State 


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1 health subsidy programs a secure, electronic inter2 face allowing an exchange of data (including infor3 mation contained in the application forms described 

4 in subsection (b)) that allows a determination of eli5 gibility for all such programs based on a single ap6 plication. Such interface shall be compatible with the 

7 method established for data verification under sec8 tion 1411(c)(4). 

9 (2) DATA MATCHING PROGRAM.—Each applica10 ble State health subsidy program shall participate in 

11 a data matching arrangement for determining eligi12 bility for participation in the program under para13 graph (3) that— 

14 (A) provides access to data described in 

15 paragraph (3); 

16 (B) applies only to individuals who— 

17 (i) receive assistance from an applica18 ble State health subsidy program; or 

19 (ii) apply for such assistance— 

20 (I) by filing a form described in 

21 subsection (b); or 

22 (II) by requesting a determina23 tion of eligibility and authorizing dis24 closure of the information described in 

25 paragraph (3) to applicable State 


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1 health coverage subsidy programs for 

2 purposes of determining and estab3 lishing eligibility; and 

4 (C) consistent with standards promulgated 

5 by the Secretary, including the privacy and data 

6 security safeguards described in section 1942 of 

7 the Social Security Act or that are otherwise 

8 applicable to such programs. 

9 (3) DETERMINATION OF ELIGIBILITY.— 

10 (A) IN GENERAL.—Each applicable State 

11 health subsidy program shall, to the maximum 

12 extent practicable— 

13 (i) establish, verify, and update eligi14 bility for participation in the program 

15 using the data matching arrangement 

16 under paragraph (2); and 

17 (ii) determine such eligibility on the 

18 basis of reliable, third party data, includ19 ing information described in sections 1137, 

20 453(i), and 1942(a) of the Social Security 

21 Act, obtained through such arrangement. 

22 (B) EXCEPTION.—This paragraph shall 

23 not apply in circumstances with respect to 

24 which the Secretary determines that the admin25 istrative and other costs of use of the data 


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1 matching arrangement under paragraph (2) 

2 outweigh its expected gains in accuracy, effi3 ciency, and program participation. 

4 (4) SECRETARIAL STANDARDS.—The Secretary 

5 shall, after consultation with persons in possession 

6 of the data to be matched and representatives of ap7 plicable State health subsidy programs, promulgate 

8 standards governing the timing, contents, and proce9 dures for data matching described in this subsection. 

10 Such standards shall take into account administra11 tive and other costs and the value of data matching 

12 to the establishment, verification, and updating of 

13 eligibility for applicable State health subsidy pro14 grams. 

15 (d) ADMINISTRATIVE AUTHORITY.— 

16 (1) AGREEMENTS.—Subject to section 1411 

17 and section 6103(l)(21) of the Internal Revenue 

18 Code of 1986 and any other requirement providing 

19 safeguards of privacy and data integrity, the Sec20 retary may establish model agreements, and enter 

21 into agreements, for the sharing of data under this 

22 section. 

23 (2) AUTHORITY OF EXCHANGE TO CONTRACT

24 OUT.—Nothing in this section shall be construed 

25 to— 


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1 (A) prohibit contractual arrangements 

2 through which a State medicaid agency deter3 mines eligibility for all applicable State health 

4 subsidy programs, but only if such agency com5 plies with the Secretary’s requirements ensuring 

6 reduced administrative costs, eligibility errors, 

7 and disruptions in coverage; or 

8 (B) change any requirement under title 

9 XIX that eligibility for participation in a 

10 State’s medicaid program must be determined 

11 by a public agency. 

12 (e) APPLICABLE STATE HEALTH SUBSIDY PRO13 GRAM.—In this section, the term ‘‘applicable State health 

14 subsidy program’’ means— 

15 (1) the program under this title for the enroll16 ment in qualified health plans offered through an 

17 Exchange, including the premium tax credits under 

18 section 36B of the Internal Revenue Code of 1986 

19 and cost-sharing reductions under section 1402; 

20 (2) a State medicaid program under title XIX 

21 of the Social Security Act; 

22 (3) a State children’s health insurance program 

23 (CHIP) under title XXI of such Act; and 

24 (4) a State program under section 1331 estab25 lishing qualified basic health plans. 


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1 SEC. 1414. DISCLOSURES TO CARRY OUT ELIGIBILITY RE2 QUIREMENTS FOR CERTAIN PROGRAMS. 

3 (a) DISCLOSURE OF TAXPAYER RETURN INFORMA4 TION AND SOCIAL SECURITY NUMBERS.— 

5 (1) TAXPAYER RETURN INFORMATION.—Sub6 section (l) of section 6103 of the Internal Revenue 

7 Code of 1986 is amended by adding at the end the 

8 following new paragraph: 

9 ‘‘(21) DISCLOSURE OF RETURN INFORMATION

10 TO CARRY OUT ELIGIBILITY REQUIREMENTS FOR

11 CERTAIN PROGRAMS.— 

12 ‘‘(A) IN GENERAL.—The Secretary, upon 

13 written request from the Secretary of Health 

14 and Human Services, shall disclose to officers, 

15 employees, and contractors of the Department 

16 of Health and Human Services return informa17 tion of any taxpayer whose income is relevant 

18 in determining any premium tax credit under 

19 section 36B or any cost-sharing reduction 

20 under section 1402 of the Patient Protection 

21 and Affordable Care Act or eligibility for par22 ticipation in a State medicaid program under 

23 title XIX of the Social Security Act, a State’s 

24 children’s health insurance program under title 

25 XXI of the Social Security Act, or a basic 

26 health program under section 1331 of Patient 


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1 Protection and Affordable Care Act. Such re2 turn information shall be limited to— 

3 ‘‘(i) taxpayer identity information 

4 with respect to such taxpayer, 

5 ‘‘(ii) the filing status of such tax6 payer, 

7 ‘‘(iii) the number of individuals for 

8 whom a deduction is allowed under section 

9 151 with respect to the taxpayer (including 

10 the taxpayer and the taxpayer’s spouse), 

11 ‘‘(iv) the modified gross income (as 

12 defined in section 36B) of such taxpayer 

13 and each of the other individuals included 

14 under clause (iii) who are required to file 

15 a return of tax imposed by chapter 1 for 

16 the taxable year, 

17 ‘‘(v) such other information as is pre18 scribed by the Secretary by regulation as 

19 might indicate whether the taxpayer is eli20 gible for such credit or reduction (and the 

21 amount thereof), and 

22 ‘‘(vi) the taxable year with respect to 

23 which the preceding information relates or, 

24 if applicable, the fact that such informa25 tion is not available. 


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1 ‘‘(B) INFORMATION TO EXCHANGE AND

2 STATE AGENCIES.—The Secretary of Health 

3 and Human Services may disclose to an Ex4 change established under the Patient Protection 

5 and Affordable Care Act or its contractors, or 

6 to a State agency administering a State pro7 gram described in subparagraph (A) or its con8 tractors, any inconsistency between the infor9 mation provided by the Exchange or State 

10 agency to the Secretary and the information 

11 provided to the Secretary under subparagraph 

12 (A). 

13 ‘‘(C) RESTRICTION ON USE OF DISCLOSED

14 INFORMATION.—Return information disclosed 

15 under subparagraph (A) or (B) may be used by 

16 officers, employees, and contractors of the De17 partment of Health and Human Services, an 

18 Exchange, or a State agency only for the pur19 poses of, and to the extent necessary in— 

20 ‘‘(i) establishing eligibility for partici21 pation in the Exchange, and verifying the 

22 appropriate amount of, any credit or re23 duction described in subparagraph (A), 


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1 ‘‘(ii) determining eligibility for partici2 pation in the State programs described in 

3 subparagraph (A).’’. 

4 (2) SOCIAL SECURITY NUMBERS.—Section 

5 205(c)(2)(C) of the Social Security Act is amended 

6 by adding at the end the following new clause: 

7 ‘‘(x) The Secretary of Health and 

8 Human Services, and the Exchanges estab9 lished under section 1311 of the Patient 

10 Protection and Affordable Care Act, are 

11 authorized to collect and use the names 

12 and social security account numbers of in13 dividuals as required to administer the pro14 visions of, and the amendments made by, 

15 the such Act.’’. 

16 (b) CONFIDENTIALITY AND DISCLOSURE.—Para17 graph (3) of section 6103(a) of such Code is amended by 

18 striking ‘‘or (20)’’ and inserting ‘‘(20), or (21)’’. 

19 (c) PROCEDURES AND RECORDKEEPING RELATED

20 TO DISCLOSURES.—Paragraph (4) of section 6103(p) of 

21 such Code is amended— 

22 (1) by inserting ‘‘, or any entity described in 

23 subsection (l)(21),’’ after ‘‘or (20)’’ in the matter 

24 preceding subparagraph (A), 


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1 (2) by inserting ‘‘or any entity described in sub2 section (l)(21),’’ after ‘‘or (o)(1)(A)’’ in subpara3 graph (F)(ii), and 

4 (3) by inserting ‘‘or any entity described in sub5 section (l)(21),’’ after ‘‘or (20)’’ both places it ap6 pears in the matter after subparagraph (F). 

7 (d) UNAUTHORIZED DISCLOSURE OR INSPECTION.— 

8 Paragraph (2) of section 7213(a) of such Code is amended 

9 by striking ‘‘or (20)’’ and inserting ‘‘(20), or (21)’’. 

10 SEC. 1415. PREMIUM TAX CREDIT AND COST-SHARING RE11 DUCTION PAYMENTS DISREGARDED FOR 

12 FEDERAL AND FEDERALLY-ASSISTED PRO13 GRAMS. 

14 For purposes of determining the eligibility of any in15 dividual for benefits or assistance, or the amount or extent 

16 of benefits or assistance, under any Federal program or 

17 under any State or local program financed in whole or in 

18 part with Federal funds— 

19 (1) any credit or refund allowed or made to any 

20 individual by reason of section 36B of the Internal 

21 Revenue Code of 1986 (as added by section 1401) 

22 shall not be taken into account as income and shall 

23 not be taken into account as resources for the month 

24 of receipt and the following 2 months; and 


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1 (2) any cost-sharing reduction payment or ad2 vance payment of the credit allowed under such sec3 tion 36B that is made under section 1402 or 1412 

4 shall be treated as made to the qualified health plan 

5 in which an individual is enrolled and not to that in6 dividual. 

7 PART II—SMALL BUSINESS TAX CREDIT 

8 SEC. 1421. CREDIT FOR EMPLOYEE HEALTH INSURANCE 

9 EXPENSES OF SMALL BUSINESSES. 

10 (a) IN GENERAL.—Subpart D of part IV of sub11 chapter A of chapter 1 of the Internal Revenue Code of 

12 1986 (relating to business-related credits) is amended by 

13 inserting after section 45Q the following: 

14 ‘‘SEC. 45R. EMPLOYEE HEALTH INSURANCE EXPENSES OF 

15 SMALL EMPLOYERS. 

16 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

17 in the case of an eligible small employer, the small em18 ployer health insurance credit determined under this sec19 tion for any taxable year in the credit period is the amount 

20 determined under subsection (b). 

21 ‘‘(b) HEALTH INSURANCE CREDIT AMOUNT.—Sub22 ject to subsection (c), the amount determined under this 

23 subsection with respect to any eligible small employer is 

24 equal to 50 percent (35 percent in the case of a tax-exempt 

25 eligible small employer) of the lesser of— 


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1 ‘‘(1) the aggregate amount of nonelective con2 tributions the employer made on behalf of its em3 ployees during the taxable year under the arrange4 ment described in subsection (d)(4) for premiums 

5 for qualified health plans offered by the employer to 

6 its employees through an Exchange, or 

7 ‘‘(2) the aggregate amount of nonelective con8 tributions which the employer would have made dur9 ing the taxable year under the arrangement if each 

10 employee taken into account under paragraph (1) 

11 had enrolled in a qualified health plan which had a 

12 premium equal to the average premium (as deter13 mined by the Secretary of Health and Human Serv14 ices) for the small group market in the rating area 

15 in which the employee enrolls for coverage. 

16 ‘‘(c) PHASEOUT OF CREDIT AMOUNT BASED ON

17 NUMBER OF EMPLOYEES AND AVERAGE WAGES.—The 

18 amount of the credit determined under subsection (b) 

19 without regard to this subsection shall be reduced (but not 

20 below zero) by the sum of the following amounts: 

21 ‘‘(1) Such amount multiplied by a fraction the 

22 numerator of which is the total number of full-time 

23 equivalent employees of the employer in excess of 10 

24 and the denominator of which is 15. 


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1 ‘‘(2) Such amount multiplied by a fraction the 

2 numerator of which is the average annual wages of 

3 the employer in excess of the dollar amount in effect 

4 under subsection (d)(3)(B) and the denominator of 

5 which is such dollar amount. 

6 ‘‘(d) ELIGIBLE SMALL EMPLOYER.—For purposes of 

7 this section— 

8 ‘‘(1) IN GENERAL.—The term ‘eligible small 

9 employer’ means, with respect to any taxable year, 

10 an employer— 

11 ‘‘(A) which has no more than 25 full-time 

12 equivalent employees for the taxable year, 

13 ‘‘(B) the average annual wages of which do 

14 not exceed an amount equal to twice the dollar 

15 amount in effect under paragraph (3)(B) for 

16 the taxable year, and 

17 ‘‘(C) which has in effect an arrangement 

18 described in paragraph (4). 

19 ‘‘(2) FULL-TIME EQUIVALENT EMPLOYEES.— 

20 ‘‘(A) IN GENERAL.—The term ‘full-time 

21 equivalent employees’ means a number of em22 ployees equal to the number determined by di23 viding— 

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1 ployer to employees during the taxable 

2 year, by 

3 ‘‘(ii) 2,080. 

4 Such number shall be rounded to the next low5 est whole number if not otherwise a whole num6 ber. 

7 ‘‘(B) EXCESS HOURS NOT COUNTED.—If 

8 an employee works in excess of 2,080 hours of 

9 service during any taxable year, such excess 

10 shall not be taken into account under subpara11 graph (A). 

12 ‘‘(C) HOURS OF SERVICE.—The Secretary, 

13 in consultation with the Secretary of Labor, 

14 shall prescribe such regulations, rules, and 

15 guidance as may be necessary to determine the 

16 hours of service of an employee, including rules 

17 for the application of this paragraph to employ18 ees who are not compensated on an hourly 

19 basis. 

20 ‘‘(3) AVERAGE ANNUAL WAGES.— 

21 ‘‘(A) IN GENERAL.—The average annual 

22 wages of an eligible small employer for any tax23 able year is the amount determined by divid24 ing— 


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1 ‘‘(i) the aggregate amount of wages 

2 which were paid by the employer to em3 ployees during the taxable year, by 

4 ‘‘(ii) the number of full-time equiva5 lent employees of the employee determined 

6 under paragraph (2) for the taxable year. 

7 Such amount shall be rounded to the next low8 est multiple of $1,000 if not otherwise such a 

9 multiple. 

10 ‘‘(B) DOLLAR AMOUNT.—For purposes of 

11 paragraph (1)(B)— 

12 ‘‘(i) 2011, 2012, AND 2013.—The dollar 

13 amount in effect under this paragraph for 

14 taxable years beginning in 2011, 2012, or 

15 2013 is $20,000. 

16 ‘‘(ii) SUBSEQUENT YEARS.—In the 

17 case of a taxable year beginning in a cal18 endar year after 2013, the dollar amount 

19 in effect under this paragraph shall be 

20 equal to $20,000, multiplied by the cost-of21 living adjustment determined under section 

22 1(f)(3) for the calendar year, determined 

23 by substituting ‘calendar year 2012’ for 

24 ‘calendar year 1992’ in subparagraph (B) 

25 thereof. 


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1 ‘‘(4) CONTRIBUTION ARRANGEMENT.—An ar2 rangement is described in this paragraph if it re3 quires an eligible small employer to make a nonelec4 tive contribution on behalf of each employee who en5 rolls in a qualified health plan offered to employees 

6 by the employer through an exchange in an amount 

7 equal to a uniform percentage (not less than 50 per8 cent) of the premium cost of the qualified health 

9 plan. 

10 ‘‘(5) SEASONAL WORKER HOURS AND WAGES

11 NOT COUNTED.—For purposes of this subsection— 

12 ‘‘(A) IN GENERAL.—The number of hours 

13 of service worked by, and wages paid to, a sea14 sonal worker of an employer shall not be taken 

15 into account in determining the full-time equiv16 alent employees and average annual wages of 

17 the employer unless the worker works for the 

18 employer on more than 120 days during the 

19 taxable year. 

20 ‘‘(B) DEFINITION OF SEASONAL WORK21 ER.—The term ‘seasonal worker’ means a work22 er who performs labor or services on a seasonal 

23 basis as defined by the Secretary of Labor, in24 cluding workers covered by section 500.20(s)(1) 

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1 tail workers employed exclusively during holiday 

2 seasons. 

3 ‘‘(e) OTHER RULES AND DEFINITIONS.—For pur4 poses of this section— 

5 ‘‘(1) EMPLOYEE.— 

6 ‘‘(A) CERTAIN EMPLOYEES EXCLUDED.— 

7 The term ‘employee’ shall not include— 

8 ‘‘(i) an employee within the meaning 

9 of section 401(c)(1), 

10 ‘‘(ii) any 2-percent shareholder (as de11 fined in section 1372(b)) of an eligible 

12 small business which is an S corporation, 

13 ‘‘(iii) any 5-percent owner (as defined 

14 in section 416(i)(1)(B)(i)) of an eligible 

15 small business, or 

16 ‘‘(iv) any individual who bears any of 

17 the relationships described in subpara18 graphs (A) through (G) of section 

19 152(d)(2) to, or is a dependent described 

20 in section 152(d)(2)(H) of, an individual 

21 described in clause (i), (ii), or (iii). 

22 ‘‘(B) LEASED EMPLOYEES.—The term 

23 ‘employee’ shall include a leased employee with24 in the meaning of section 414(n). 


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1 ‘‘(2) CREDIT PERIOD.—The term ‘credit period’ 

2 means, with respect to any eligible small employer, 

3 the 2-consecutive-taxable year period beginning with 

4 the 1st taxable year in which the employer (or any 

5 predecessor) offers 1 or more qualified health plans 

6 to its employees through an Exchange. 

7 ‘‘(3) NONELECTIVE CONTRIBUTION.—The term 

8 ‘nonelective contribution’ means an employer con9 tribution other than an employer contribution pursu10 ant to a salary reduction arrangement. 

11 ‘‘(4) WAGES.—The term ‘wages’ has the mean12 ing given such term by section 3121(a) (determined 

13 without regard to any dollar limitation contained in 

14 such section). 

15 ‘‘(5) AGGREGATION AND OTHER RULES MADE

16 APPLICABLE.— 

17 ‘‘(A) AGGREGATION RULES.—All employ18 ers treated as a single employer under sub19 section (b), (c), (m), or (o) of section 414 shall 

20 be treated as a single employer for purposes of 

21 this section. 

22 ‘‘(B) OTHER RULES.—Rules similar to the 

23 rules of subsections (c), (d), and (e) of section 

24 52 shall apply. 


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1 ‘‘(f) CREDIT MADE AVAILABLE TO TAX-EXEMPT ELI2 GIBLE SMALL EMPLOYERS.— 

3 ‘‘(1) IN GENERAL.—In the case of a tax-exempt 

4 eligible small employer, there shall be treated as a 

5 credit allowable under subpart C (and not allowable 

6 under this subpart) the lesser of— 

7 ‘‘(A) the amount of the credit determined 

8 under this section with respect to such em9 ployer, or 

10 ‘‘(B) the amount of the payroll taxes of the 

11 employer during the calendar year in which the 

12 taxable year begins. 

13 ‘‘(2) TAX-EXEMPT ELIGIBLE SMALL EM14 PLOYER.—For purposes of this section, the term 

15 ‘tax-exempt eligible small employer’ means an eligi16 ble small employer which is any organization de17 scribed in section 501(c) which is exempt from tax18 ation under section 501(a). 

19 ‘‘(3) PAYROLL TAXES.—For purposes of this 

20 subsection— 

21 ‘‘(A) IN GENERAL.—The term ‘payroll 

22 taxes’ means— 

23 ‘‘(i) amounts required to be withheld 

24 from the employees of the tax-exempt eligi25 ble small employer under section 3401(a), 


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1 ‘‘(ii) amounts required to be withheld 

2 from such employees under section 

3 3101(b), and 

4 ‘‘(iii) amounts of the taxes imposed on 

5 the tax-exempt eligible small employer 

6 under section 3111(b). 

7 ‘‘(B) SPECIAL RULE.—A rule similar to 

8 the rule of section 24(d)(2)(C) shall apply for 

9 purposes of subparagraph (A). 

10 ‘‘(g) APPLICATION OF SECTION FOR CALENDAR

11 YEARS 2011, 2012, AND 2013.—In the case of any tax12 able year beginning in 2011, 2012, or 2013, the following 

13 modifications to this section shall apply in determining the 

14 amount of the credit under subsection (a): 

15 ‘‘(1) NO CREDIT PERIOD REQUIRED.—The 

16 credit shall be determined without regard to whether 

17 the taxable year is in a credit period and for pur18 poses of applying this section to taxable years begin19 ning after 2013, no credit period shall be treated as 

20 beginning with a taxable year beginning before 

21 2014. 

22 ‘‘(2) AMOUNT OF CREDIT.—The amount of the 

23 credit determined under subsection (b) shall be de24 termined— 


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1 ‘‘(A) by substituting ‘35 percent (25 per2 cent in the case of a tax-exempt eligible small 

3 employer)’ for ‘50 percent (35 percent in the 

4 case of a tax-exempt eligible small employer)’, 

5 ‘‘(B) by reference to an eligible small em6 ployer’s nonelective contributions for premiums 

7 paid for health insurance coverage (within the 

8 meaning of section 9832(b)(1)) of an employee, 

9 and 

10 ‘‘(C) by substituting for the average pre11 mium determined under subsection (b)(2) the 

12 amount the Secretary of Health and Human 

13 Services determines is the average premium for 

14 the small group market in the State in which 

15 the employer is offering health insurance cov16 erage (or for such area within the State as is 

17 specified by the Secretary). 

18 ‘‘(3) CONTRIBUTION ARRANGEMENT.—An ar19 rangement shall not fail to meet the requirements of 

20 subsection (d)(4) solely because it provides for the 

21 offering of insurance outside of an Exchange. 

22 ‘‘(h) INSURANCE DEFINITIONS.—Any term used in 

23 this section which is also used in the Public Health Service 

24 Act or subtitle A of title I of the Patient Protection and 


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1 Affordable Care Act shall have the meaning given such 

2 term by such Act or subtitle. 

3 ‘‘(i) REGULATIONS.—The Secretary shall prescribe 

4 such regulations as may be necessary to carry out the pro5 visions of this section, including regulations to prevent the 

6 avoidance of the 2-year limit on the credit period through 

7 the use of successor entities and the avoidance of the limi8 tations under subsection (c) through the use of multiple 

9 entities.’’. 

10 (b) CREDIT TO BE PART OF GENERAL BUSINESS

11 CREDIT.—Section 38(b) of the Internal Revenue Code of 

12 1986 (relating to current year business credit) is amended 

13 by striking ‘‘plus’’ at the end of paragraph (34), by strik14 ing the period at the end of paragraph (35) and inserting 

15 ‘‘, plus’’, and by inserting after paragraph (35) the fol16 lowing: 

17 ‘‘(36) the small employer health insurance cred18 it determined under section 45R.’’. 

19 (c) CREDIT ALLOWED AGAINST ALTERNATIVE MIN20 IMUM TAX.—Section 38(c)(4)(B) of the Internal Revenue 

21 Code of 1986 (defining specified credits) is amended by 

22 redesignating clauses (vi), (vii), and (viii) as clauses (vii), 

23 (viii), and (ix), respectively, and by inserting after clause 

24 (v) the following new clause: 


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1 ‘‘(vi) the credit determined under sec2 tion 45R,’’. 

3 (d) DISALLOWANCE OF DEDUCTION FOR CERTAIN

4 EXPENSES FOR WHICH CREDIT ALLOWED.— 

5 (1) IN GENERAL.—Section 280C of the Internal 

6 Revenue Code of 1986 (relating to disallowance of 

7 deduction for certain expenses for which credit al8 lowed), as amended by section 1401(b), is amended 

9 by adding at the end the following new subsection: 

10 ‘‘(h) CREDIT FOR EMPLOYEE HEALTH INSURANCE

11 EXPENSES OF SMALL EMPLOYERS.—No deduction shall 

12 be allowed for that portion of the premiums for qualified 

13 health plans (as defined in section 1301(a) of the Patient 

14 Protection and Affordable Care Act), or for health insur15 ance coverage in the case of taxable years beginning in 

16 2011, 2012, or 2013, paid by an employer which is equal 

17 to the amount of the credit determined under section 

18 45R(a) with respect to the premiums.’’. 

19 (2) DEDUCTION FOR EXPIRING CREDITS.—Sec20 tion 196(c) of such Code is amended by striking 

21 ‘‘and’’ at the end of paragraph (12), by striking the 

22 period at the end of paragraph (13) and inserting ‘‘, 

23 and’’, and by adding at the end the following new 

24 paragraph: 


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1 ‘‘(14) the small employer health insurance cred2 it determined under section 45R(a).’’. 

3 (e) CLERICAL AMENDMENT.—The table of sections 

4 for subpart D of part IV of subchapter A of chapter 1 

5 of the Internal Revenue Code of 1986 is amended by add6 ing at the end the following: 

‘‘Sec. 45R. Employee health insurance expenses of small employers.’’. 

7 (f) EFFECTIVE DATES.— 

8 (1) IN GENERAL.—The amendments made by 

9 this section shall apply to amounts paid or incurred 

10 in taxable years beginning after December 31, 2010. 

11 (2) MINIMUM TAX.—The amendments made by 

12 subsection (c) shall apply to credits determined 

13 under section 45R of the Internal Revenue Code of 

14 1986 in taxable years beginning after December 31, 

15 2010, and to carrybacks of such credits. 

16 Subtitle F—Shared Responsibility 

17 for Health Care 

18 PART I—INDIVIDUAL RESPONSIBILITY 

19 SEC. 1501. REQUIREMENT TO MAINTAIN MINIMUM ESSEN20 TIAL COVERAGE. 

21 (a) FINDINGS.—Congress makes the following find22 ings: 

23 (1) IN GENERAL.—The individual responsibility 

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1 cial and economic in nature, and substantially af2 fects interstate commerce, as a result of the effects 

3 described in paragraph (2). 

4 (2) EFFECTS ON THE NATIONAL ECONOMY AND

5 INTERSTATE COMMERCE.—The effects described in 

6 this paragraph are the following: 

7 (A) The requirement regulates activity that 

8 is commercial and economic in nature: economic 

9 and financial decisions about how and when 

10 health care is paid for, and when health insur11 ance is purchased. 

12 (B) Health insurance and health care serv13 ices are a significant part of the national econ14 omy. National health spending is projected to 

15 increase from $2,500,000,000,000, or 17.6 per16 cent of the economy, in 2009 to 

17 $4,700,000,000,000 in 2019. Private health in18 surance spending is projected to be 

19 $854,000,000,000 in 2009, and pays for med20 ical supplies, drugs, and equipment that are 

21 shipped in interstate commerce. Since most 

22 health insurance is sold by national or regional 

23 health insurance companies, health insurance is 

24 sold in interstate commerce and claims pay25 ments flow through interstate commerce. 


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1 (C) The requirement, together with the 

2 other provisions of this Act, will add millions of 

3 new consumers to the health insurance market, 

4 increasing the supply of, and demand for, 

5 health care services. According to the Congres6 sional Budget Office, the requirement will in7 crease the number and share of Americans who 

8 are insured. 

9 (D) The requirement achieves near-uni10 versal coverage by building upon and strength11 ening the private employer-based health insur12 ance system, which covers 176,000,000 Ameri13 cans nationwide. In Massachusetts, a similar re14 quirement has strengthened private employer15 based coverage: despite the economic downturn, 

16 the number of workers offered employer-based 

17 coverage has actually increased. 

18 (E) Half of all personal bankruptcies are 

19 caused in part by medical expenses. By signifi20 cantly increasing health insurance coverage, the 

21 requirement, together with the other provisions 

22 of this Act, will improve financial security for 

23 families. 

24 (F) Under the Employee Retirement In25 come Security Act of 1974 (29 U.S.C. 1001 et 


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1 seq.), the Public Health Service Act (42 U.S.C. 

2 201 et seq.), and this Act, the Federal Govern3 ment has a significant role in regulating health 

4 insurance which is in interstate commerce. 

5 (G) Under sections 2704 and 2705 of the 

6 Public Health Service Act (as added by section 

7 1201 of this Act), if there were no requirement, 

8 many individuals would wait to purchase health 

9 insurance until they needed care. By signifi10 cantly increasing health insurance coverage, the 

11 requirement, together with the other provisions 

12 of this Act, will minimize this adverse selection 

13 and broaden the health insurance risk pool to 

14 include healthy individuals, which will lower 

15 health insurance premiums. The requirement is 

16 essential to creating effective health insurance 

17 markets in which improved health insurance 

18 products that are guaranteed issue and do not 

19 exclude coverage of pre-existing conditions can 

20 be sold. 

21 (H) Administrative costs for private health 

22 insurance, which were $90,000,000,000 in 

23 2006, are 26 to 30 percent of premiums in the 

24 current individual and small group markets. By 

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1 erage and the size of purchasing pools, which 

2 will increase economies of scale, the require3 ment, together with the other provisions of this 

4 Act, will significantly reduce administrative 

5 costs and lower health insurance premiums. 

6 The requirement is essential to creating effec7 tive health insurance markets that do not re8 quire underwriting and eliminate its associated 

9 administrative costs. 

10 (3) SUPREME COURT RULING.—In United 

11 States v. South-Eastern Underwriters Association 

12 (322 U.S. 533 (1944)), the Supreme Court of the 

13 United States ruled that insurance is interstate com14 merce subject to Federal regulation. 

15 (b) IN GENERAL.—Subtitle D of the Internal Rev16 enue Code of 1986 is amended by adding at the end the 

17 following new chapter: 

18 ‘‘CHAPTER 48—MAINTENANCE OF 

19 MINIMUM ESSENTIAL COVERAGE 

‘‘Sec. 5000A. Requirement to maintain minimum essential coverage. 

20 ‘‘SEC. 5000A. REQUIREMENT TO MAINTAIN MINIMUM ES21 SENTIAL COVERAGE. 

22 ‘‘(a) REQUIREMENT TO MAINTAIN MINIMUM ESSEN23 TIAL COVERAGE.—An applicable individual shall for each 

24 month beginning after 2013 ensure that the individual, 


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1 and any dependent of the individual who is an applicable 

2 individual, is covered under minimum essential coverage 

3 for such month. 

4 ‘‘(b) SHARED RESPONSIBILITY PAYMENT.— 

5 ‘‘(1) IN GENERAL.—If an applicable individual 

6 fails to meet the requirement of subsection (a) for 

7 1 or more months during any calendar year begin8 ning after 2013, then, except as provided in sub9 section (d), there is hereby imposed a penalty with 

10 respect to the individual in the amount determined 

11 under subsection (c). 

12 ‘‘(2) INCLUSION WITH RETURN.—Any penalty 

13 imposed by this section with respect to any month 

14 shall be included with a taxpayer’s return under 

15 chapter 1 for the taxable year which includes such 

16 month. 

17 ‘‘(3) PAYMENT OF PENALTY.—If an individual 

18 with respect to whom a penalty is imposed by this 

19 section for any month— 

20 ‘‘(A) is a dependent (as defined in section 

21 152) of another taxpayer for the other tax22 payer’s taxable year including such month, such 

23 other taxpayer shall be liable for such penalty, 

24 or 


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1 ‘‘(B) files a joint return for the taxable 

2 year including such month, such individual and 

3 the spouse of such individual shall be jointly lia4 ble for such penalty. 

5 ‘‘(c) AMOUNT OF PENALTY.— 

6 ‘‘(1) IN GENERAL.—The penalty determined 

7 under this subsection for any month with respect to 

any individual is an amount equal to 1 8 ⁄12 of the ap9 plicable dollar amount for the calendar year. 

10 ‘‘(2) DOLLAR LIMITATION.—The amount of the 

11 penalty imposed by this section on any taxpayer for 

12 any taxable year with respect to all individuals for 

13 whom the taxpayer is liable under subsection (b)(3) 

14 shall not exceed an amount equal to 300 percent the 

15 applicable dollar amount (determined without regard 

16 to paragraph (3)(C)) for the calendar year with or 

17 within which the taxable year ends. 

18 ‘‘(3) APPLICABLE DOLLAR AMOUNT.—For pur19 poses of paragraph (1)— 

20 ‘‘(A) IN GENERAL.—Except as provided in 

21 subparagraphs (B) and (C), the applicable dol22 lar amount is $750. 

23 ‘‘(B) PHASE IN.—The applicable dollar 

24 amount is $95 for 2014 and $350 for 2015. 


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1 ‘‘(C) SPECIAL RULE FOR INDIVIDUALS

2 UNDER AGE 18.—If an applicable individual has 

3 not attained the age of 18 as of the beginning 

4 of a month, the applicable dollar amount with 

5 respect to such individual for the month shall 

6 be equal to one-half of the applicable dollar 

7 amount for the calendar year in which the 

8 month occurs. 

9 ‘‘(D) INDEXING OF AMOUNT.—In the case 

10 of any calendar year beginning after 2016, the 

11 applicable dollar amount shall be equal to $750, 

12 increased by an amount equal to— 

13 ‘‘(i) $750, multiplied by 

14 ‘‘(ii) the cost-of-living adjustment de15 termined under section 1(f)(3) for the cal16 endar year, determined by substituting 

17 ‘calendar year 2015’ for ‘calendar year 

18 1992’ in subparagraph (B) thereof. 

19 If the amount of any increase under clause (i) 

20 is not a multiple of $50, such increase shall be 

21 rounded to the next lowest multiple of $50. 

22 ‘‘(4) TERMS RELATING TO INCOME AND FAMI23 LIES.—For purposes of this section— 

24 ‘‘(A) FAMILY SIZE.—The family size in25 volved with respect to any taxpayer shall be 


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1 equal to the number of individuals for whom 

2 the taxpayer is allowed a deduction under sec3 tion 151 (relating to allowance of deduction for 

4 personal exemptions) for the taxable year. 

5 ‘‘(B) HOUSEHOLD INCOME.—The term 

6 ‘household income’ means, with respect to any 

7 taxpayer for any taxable year, an amount equal 

8 to the sum of— 

9 ‘‘(i) the modified gross income of the 

10 taxpayer, plus 

11 ‘‘(ii) the aggregate modified gross in12 comes of all other individuals who— 

13 ‘‘(I) were taken into account in 

14 determining the taxpayer’s family size 

15 under paragraph (1), and 

16 ‘‘(II) were required to file a re17 turn of tax imposed by section 1 for 

18 the taxable year. 

19 ‘‘(C) MODIFIED GROSS INCOME.—The 

20 term ‘modified gross income’ means gross in21 come— 

22 ‘‘(i) decreased by the amount of any 

23 deduction allowable under paragraph (1), 

24 (3), (4), or (10) of section 62(a), 


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1 ‘‘(ii) increased by the amount of inter2 est received or accrued during the taxable 

3 year which is exempt from tax imposed by 

4 this chapter, and 

5 ‘‘(iii) determined without regard to 

6 sections 911, 931, and 933. 

7 ‘‘(D) POVERTY LINE.— 

8 ‘‘(i) IN GENERAL.—The term ‘poverty 

9 line’ has the meaning given that term in 

10 section 2110(c)(5) of the Social Security 

11 Act (42 U.S.C. 1397jj(c)(5)). 

12 ‘‘(ii) POVERTY LINE USED.—In the 

13 case of any taxable year ending with or 

14 within a calendar year, the poverty line 

15 used shall be the most recently published 

16 poverty line as of the 1st day of such cal17 endar year. 

18 ‘‘(d) APPLICABLE INDIVIDUAL.—For purposes of this 

19 section— 

20 ‘‘(1) IN GENERAL.—The term ‘applicable indi21 vidual’ means, with respect to any month, an indi22 vidual other than an individual described in para23 graph (2), (3), or (4). 

24 ‘‘(2) RELIGIOUS EXEMPTIONS.— 


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1 ‘‘(A) RELIGIOUS CONSCIENCE EXEMP2 TION.—Such term shall not include any indi3 vidual for any month if such individual has in 

4 effect an exemption under section 

5 1311(d)(4)(H) of the Patient Protection and 

6 Affordable Care Act which certifies that such 

7 individual is a member of a recognized religious 

8 sect or division thereof described in section 

9 1402(g)(1) and an adherent of established te10 nets or teachings of such sect or division as de11 scribed in such section. 

12 ‘‘(B) HEALTH CARE SHARING MINISTRY.— 

13 ‘‘(i) IN GENERAL.—Such term shall 

14 not include any individual for any month if 

15 such individual is a member of a health 

16 care sharing ministry for the month. 

17 ‘‘(ii) HEALTH CARE SHARING MIN18 ISTRY.—The term ‘health care sharing 

19 ministry’ means an organization— 

20 ‘‘(I) which is described in section 

21 501(c)(3) and is exempt from taxation 

22 under section 501(a), 

23 ‘‘(II) members of which share a 

24 common set of ethical or religious be25 liefs and share medical expenses 


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1 among members in accordance with 

2 those beliefs and without regard to 

3 the State in which a member resides 

4 or is employed, 

5 ‘‘(III) members of which retain 

6 membership even after they develop a 

7 medical condition, 

8 ‘‘(IV) which (or a predecessor of 

9 which) has been in existence at all 

10 times since December 31, 1999, and 

11 medical expenses of its members have 

12 been shared continuously and without 

13 interruption since at least December 

14 31, 1999, and 

15 ‘‘(V) which conducts an annual 

16 audit which is performed by an inde17 pendent certified public accounting 

18 firm in accordance with generally ac19 cepted accounting principles and 

20 which is made available to the public 

21 upon request. 

22 ‘‘(3) INDIVIDUALS NOT LAWFULLY PRESENT.— 

23 Such term shall not include an individual for any 

24 month if for the month the individual is not a citizen 


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1 or national of the United States or an alien lawfully 

2 present in the United States. 

3 ‘‘(4) INCARCERATED INDIVIDUALS.—Such term 

4 shall not include an individual for any month if for 

5 the month the individual is incarcerated, other than 

6 incarceration pending the disposition of charges. 

7 ‘‘(e) EXEMPTIONS.—No penalty shall be imposed 

8 under subsection (a) with respect to— 

9 ‘‘(1) INDIVIDUALS WHO CANNOT AFFORD COV10 ERAGE.— 

11 ‘‘(A) IN GENERAL.—Any applicable indi12 vidual for any month if the applicable individ13 ual’s required contribution (determined on an 

14 annual basis) for coverage for the month ex15 ceeds 8 percent of such individual’s household 

16 income for the taxable year described in section 

17 1412(b)(1)(B) of the Patient Protection and 

18 Affordable Care Act. For purposes of applying 

19 this subparagraph, the taxpayer’s household in20 come shall be increased by any exclusion from 

21 gross income for any portion of the required 

22 contribution made through a salary reduction 

23 arrangement. 


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1 ‘‘(B) REQUIRED CONTRIBUTION.—For 

2 purposes of this paragraph, the term ‘required 

3 contribution’ means— 

4 ‘‘(i) in the case of an individual eligi5 ble to purchase minimum essential cov6 erage consisting of coverage through an el7 igible-employer-sponsored plan, the portion 

8 of the annual premium which would be 

9 paid by the individual (without regard to 

10 whether paid through salary reduction or 

11 otherwise) for self-only coverage, or 

12 ‘‘(ii) in the case of an individual eligi13 ble only to purchase minimum essential 

14 coverage described in subsection (f)(1)(C), 

15 the annual premium for the lowest cost 

16 bronze plan available in the individual 

17 market through the Exchange in the State 

18 in the rating area in which the individual 

19 resides (without regard to whether the in20 dividual purchased a qualified health plan 

21 through the Exchange), reduced by the 

22 amount of the credit allowable under sec23 tion 36B for the taxable year (determined 

24 as if the individual was covered by a qualiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00333 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 fied health plan offered through the Ex2 change for the entire taxable year). 

3 ‘‘(C) SPECIAL RULES FOR INDIVIDUALS

4 RELATED TO EMPLOYEES.—For purposes of 

5 subparagraph (B)(i), if an applicable individual 

6 is eligible for minimum essential coverage 

7 through an employer by reason of a relationship 

8 to an employee, the determination shall be 

9 made by reference to the affordability of the 

10 coverage to the employee. 

11 ‘‘(D) INDEXING.—In the case of plan years 

12 beginning in any calendar year after 2014, sub13 paragraph (A) shall be applied by substituting 

14 for ‘8 percent’ the percentage the Secretary of 

15 Health and Human Services determines reflects 

16 the excess of the rate of premium growth be17 tween the preceding calendar year and 2013 

18 over the rate of income growth for such period. 

19 ‘‘(2) TAXPAYERS WITH INCOME UNDER 100

20 PERCENT OF POVERTY LINE.—Any applicable indi21 vidual for any month during a calendar year if the 

22 individual’s household income for the taxable year 

23 described in section 1412(b)(1)(B) of the Patient 

24 Protection and Affordable Care Act is less than 100 

25 percent of the poverty line for the size of the family 


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1 involved (determined in the same manner as under 

2 subsection (b)(4)). 

3 ‘‘(3) MEMBERS OF INDIAN TRIBES.—Any appli4 cable individual for any month during which the in5 dividual is a member of an Indian tribe (as defined 

6 in section 45A(c)(6)). 

7 ‘‘(4) MONTHS DURING SHORT COVERAGE

8 GAPS.— 

9 ‘‘(A) IN GENERAL.—Any month the last 

10 day of which occurred during a period in which 

11 the applicable individual was not covered by 

12 minimum essential coverage for a continuous 

13 period of less than 3 months. 

14 ‘‘(B) SPECIAL RULES.—For purposes of 

15 applying this paragraph— 

16 ‘‘(i) the length of a continuous period 

17 shall be determined without regard to the 

18 calendar years in which months in such pe19 riod occur, 

20 ‘‘(ii) if a continuous period is greater 

21 than the period allowed under subpara22 graph (A), no exception shall be provided 

23 under this paragraph for any month in the 

24 period, and 


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1 ‘‘(iii) if there is more than 1 contin2 uous period described in subparagraph (A) 

3 covering months in a calendar year, the ex4 ception provided by this paragraph shall 

5 only apply to months in the first of such 

6 periods. 

7 The Secretary shall prescribe rules for the col8 lection of the penalty imposed by this section in 

9 cases where continuous periods include months 

10 in more than 1 taxable year. 

11 ‘‘(5) HARDSHIPS.—Any applicable individual 

12 who for any month is determined by the Secretary 

13 of Health and Human Services under section 

14 1311(d)(4)(H) to have suffered a hardship with re15 spect to the capability to obtain coverage under a 

16 qualified health plan. 

17 ‘‘(f) MINIMUM ESSENTIAL COVERAGE.—For pur18 poses of this section— 

19 ‘‘(1) IN GENERAL.—The term ‘minimum essen20 tial coverage’ means any of the following: 

21 ‘‘(A) GOVERNMENT SPONSORED PRO22 GRAMS.—Coverage under— 

23 ‘‘(i) the Medicare program under part 

24 A of title XVIII of the Social Security Act, 


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1 ‘‘(ii) the Medicaid program under title 

2 XIX of the Social Security Act, 

3 ‘‘(iii) the CHIP program under title 

4 XXI of the Social Security Act, 

5 ‘‘(iv) the TRICARE for Life program, 

6 ‘‘(v) the veteran’s health care program 

7 under chapter 17 of title 38, United States 

8 Code, or 

9 ‘‘(vi) a health plan under section 

10 2504(e) of title 22, United States Code 

11 (relating to Peace Corps volunteers). 

12 ‘‘(B) EMPLOYER-SPONSORED PLAN.—Cov13 erage under an eligible employer-sponsored 

14 plan. 

15 ‘‘(C) PLANS IN THE INDIVIDUAL MAR16 KET.—Coverage under a health plan offered in 

17 the individual market within a State. 

18 ‘‘(D) GRANDFATHERED HEALTH PLAN.— 

19 Coverage under a grandfathered health plan. 

20 ‘‘(E) OTHER COVERAGE.—Such other 

21 health benefits coverage, such as a State health 

22 benefits risk pool, as the Secretary of Health 

23 and Human Services, in coordination with the 

24 Secretary, recognizes for purposes of this sub25 section. 


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1 ‘‘(2) ELIGIBLE EMPLOYER-SPONSORED PLAN.— 

2 The term ‘eligible employer-sponsored plan’ means, 

3 with respect to any employee, a group health plan or 

4 group health insurance coverage offered by an em5 ployer to the employee which is— 

6 ‘‘(A) a governmental plan (within the 

7 meaning of section 2791(d)(8) of the Public 

8 Health Service Act), or 

9 ‘‘(B) any other plan or coverage offered in 

10 the small or large group market within a State. 

11 Such term shall include a grandfathered health plan 

12 described in paragraph (1)(D) offered in a group 

13 market. 

14 ‘‘(3) EXCEPTED BENEFITS NOT TREATED AS

15 MINIMUM ESSENTIAL COVERAGE.—The term ‘min16 imum essential coverage’ shall not include health in17 surance coverage which consists of coverage of ex18 cepted benefits— 

19 ‘‘(A) described in paragraph (1) of sub20 section (c) of section 2791 of the Public Health 

21 Service Act; or 

22 ‘‘(B) described in paragraph (2), (3), or 

23 (4) of such subsection if the benefits are pro24 vided under a separate policy, certificate, or 

25 contract of insurance. 


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1 ‘‘(4) INDIVIDUALS RESIDING OUTSIDE UNITED

2 STATES OR RESIDENTS OF TERRITORIES.—Any ap3 plicable individual shall be treated as having min4 imum essential coverage for any month— 

5 ‘‘(A) if such month occurs during any pe6 riod described in subparagraph (A) or (B) of 

7 section 911(d)(1) which is applicable to the in8 dividual, or 

9 ‘‘(B) if such individual is a bona fide resi10 dent of any possession of the United States (as 

11 determined under section 937(a)) for such 

12 month. 

13 ‘‘(5) INSURANCE-RELATED TERMS.—Any term 

14 used in this section which is also used in title I of 

15 the Patient Protection and Affordable Care Act shall 

16 have the same meaning as when used in such title. 

17 ‘‘(g) ADMINISTRATION AND PROCEDURE.— 

18 ‘‘(1) IN GENERAL.—The penalty provided by 

19 this section shall be paid upon notice and demand by 

20 the Secretary, and except as provided in paragraph 

21 (2), shall be assessed and collected in the same man22 ner as an assessable penalty under subchapter B of 

23 chapter 68. 

24 ‘‘(2) SPECIAL RULES.—Notwithstanding any 

25 other provision of law— 


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1 ‘‘(A) WAIVER OF CRIMINAL PENALTIES.— 

2 In the case of any failure by a taxpayer to time3 ly pay any penalty imposed by this section, such 

4 taxpayer shall not be subject to any criminal 

5 prosecution or penalty with respect to such fail6 ure. 

7 ‘‘(B) LIMITATIONS ON LIENS AND LEV8 IES.—The Secretary shall not— 

9 ‘‘(i) file notice of lien with respect to 

10 any property of a taxpayer by reason of 

11 any failure to pay the penalty imposed by 

12 this section, or 

13 ‘‘(ii) levy on any such property with 

14 respect to such failure.’’. 

15 (c) CLERICAL AMENDMENT.—The table of chapters 

16 for subtitle D of the Internal Revenue Code of 1986 is 

17 amended by inserting after the item relating to chapter 

18 47 the following new item: 

‘‘CHAPTER 48—MAINTENANCE OF MINIMUM ESSENTIAL COVERAGE.’’. 

19 (d) EFFECTIVE DATE.—The amendments made by 

20 this section shall apply to taxable years ending after De21 cember 31, 2013. 

22 SEC. 1502. REPORTING OF HEALTH INSURANCE COVERAGE. 

23 (a) IN GENERAL.—Part III of subchapter A of chap24 ter 61 of the Internal Revenue Code of 1986 is amended 

25 by inserting after subpart C the following new subpart: 


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1 ‘‘Subpart D—Information Regarding Health 

2 Insurance Coverage 

‘‘Sec. 6055. Reporting of health insurance coverage. 

3 ‘‘SEC. 6055. REPORTING OF HEALTH INSURANCE COV4 ERAGE. 

5 ‘‘(a) IN GENERAL.—Every person who provides min6 imum essential coverage to an individual during a calendar 

7 year shall, at such time as the Secretary may prescribe, 

8 make a return described in subsection (b). 

9 ‘‘(b) FORM AND MANNER OF RETURN.— 

10 ‘‘(1) IN GENERAL.—A return is described in 

11 this subsection if such return— 

12 ‘‘(A) is in such form as the Secretary may 

13 prescribe, and 

14 ‘‘(B) contains— 

15 ‘‘(i) the name, address and TIN of 

16 the primary insured and the name and 

17 TIN of each other individual obtaining cov18 erage under the policy, 

19 ‘‘(ii) the dates during which such indi20 vidual was covered under minimum essen21 tial coverage during the calendar year, 

22 ‘‘(iii) in the case of minimum essential 

23 coverage which consists of health insurance 

24 coverage, information concerning— 


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1 ‘‘(I) whether or not the coverage 

2 is a qualified health plan offered 

3 through an Exchange established 

4 under section 1311 of the Patient 

5 Protection and Affordable Care Act, 

6 and 

7 ‘‘(II) in the case of a qualified 

8 health plan, the amount (if any) of 

9 any advance payment under section 

10 1412 of the Patient Protection and 

11 Affordable Care Act of any cost-shar12 ing reduction under section 1402 of 

13 such Act or of any premium tax credit 

14 under section 36B with respect to 

15 such coverage, and 

16 ‘‘(iv) such other information as the 

17 Secretary may require. 

18 ‘‘(2) INFORMATION RELATING TO EMPLOYER19 PROVIDED COVERAGE.—If minimum essential cov20 erage provided to an individual under subsection (a) 

21 consists of health insurance coverage of a health in22 surance issuer provided through a group health plan 

23 of an employer, a return described in this subsection 

24 shall include— 


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1 ‘‘(A) the name, address, and employer 

2 identification number of the employer maintain3 ing the plan, 

4 ‘‘(B) the portion of the premium (if any) 

5 required to be paid by the employer, and 

6 ‘‘(C) if the health insurance coverage is a 

7 qualified health plan in the small group market 

8 offered through an Exchange, such other infor9 mation as the Secretary may require for admin10 istration of the credit under section 45R (relat11 ing to credit for employee health insurance ex12 penses of small employers). 

13 ‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVID14 UALS WITH RESPECT TO WHOM INFORMATION IS RE15 PORTED.— 

16 ‘‘(1) IN GENERAL.—Every person required to 

17 make a return under subsection (a) shall furnish to 

18 each individual whose name is required to be set 

19 forth in such return a written statement showing— 

20 ‘‘(A) the name and address of the person 

21 required to make such return and the phone 

22 number of the information contact for such per23 son, and 

24 ‘‘(B) the information required to be shown 

25 on the return with respect to such individual. 


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1 ‘‘(2) TIME FOR FURNISHING STATEMENTS.— 

2 The written statement required under paragraph (1) 

3 shall be furnished on or before January 31 of the 

4 year following the calendar year for which the return 

5 under subsection (a) was required to be made. 

6 ‘‘(d) COVERAGE PROVIDED BY GOVERNMENTAL

7 UNITS.—In the case of coverage provided by any govern8 mental unit or any agency or instrumentality thereof, the 

9 officer or employee who enters into the agreement to pro10 vide such coverage (or the person appropriately designated 

11 for purposes of this section) shall make the returns and 

12 statements required by this section. 

13 ‘‘(e) MINIMUM ESSENTIAL COVERAGE.—For pur14 poses of this section, the term ‘minimum essential cov15 erage’ has the meaning given such term by section 

16 5000A(f).’’. 

17 (b) ASSESSABLE PENALTIES.— 

18 (1) Subparagraph (B) of section 6724(d)(1) of 

19 the Internal Revenue Code of 1986 (relating to defi20 nitions) is amended by striking ‘‘or’’ at the end of 

21 clause (xxii), by striking ‘‘and’’ at the end of clause 

22 (xxiii) and inserting ‘‘or’’, and by inserting after 

23 clause (xxiii) the following new clause: 


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1 ‘‘(xxiv) section 6055 (relating to re2 turns relating to information regarding 

3 health insurance coverage), and’’. 

4 (2) Paragraph (2) of section 6724(d) of such 

5 Code is amended by striking ‘‘or’’ at the end of sub6 paragraph (EE), by striking the period at the end 

7 of subparagraph (FF) and inserting ‘‘, or’’ and by 

8 inserting after subparagraph (FF) the following new 

9 subparagraph: 

10 ‘‘(GG) section 6055(c) (relating to state11 ments relating to information regarding health 

12 insurance coverage).’’. 

13 (c) NOTIFICATION OF NONENROLLMENT.—Not later 

14 than June 30 of each year, the Secretary of the Treasury, 

15 acting through the Internal Revenue Service and in con16 sultation with the Secretary of Health and Human Serv17 ices, shall send a notification to each individual who files 

18 an individual income tax return and who is not enrolled 

19 in minimum essential coverage (as defined in section 

20 5000A of the Internal Revenue Code of 1986). Such noti21 fication shall contain information on the services available 

22 through the Exchange operating in the State in which 

23 such individual resides. 

24 (d) CONFORMING AMENDMENT.—The table of sub25 parts for part III of subchapter A of chapter 61 of such 


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1 Code is amended by inserting after the item relating to 

2 subpart C the following new item: 

‘‘SUBPART D—INFORMATION REGARDING HEALTH INSURANCE COVERAGE’’. 

3 (e) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to calendar years beginning after 

5 2013. 

6 PART II—EMPLOYER RESPONSIBILITIES 

7 SEC. 1511. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF 

8 LARGE EMPLOYERS. 

9 The Fair Labor Standards Act of 1938 is amended 

10 by inserting after section 18 (29 U.S.C. 218) the fol11 lowing: 

12 ‘‘SEC. 18A. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF 

13 LARGE EMPLOYERS. 

14 ‘‘In accordance with regulations promulgated by the 

15 Secretary, an employer to which this Act applies that has 

16 more than 200 full-time employees and that offers employ17 ees enrollment in 1 or more health benefits plans shall 

18 automatically enroll new full-time employees in one of the 

19 plans offered (subject to any waiting period authorized by 

20 law) and to continue the enrollment of current employees 

21 in a health benefits plan offered through the employer. 

22 Any automatic enrollment program shall include adequate 

23 notice and the opportunity for an employee to opt out of 

24 any coverage the individual or employee were automati25 cally enrolled in. Nothing in this section shall be construed 


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1 to supersede any State law which establishes, implements, 

2 or continues in effect any standard or requirement relating 

3 to employers in connection with payroll except to the ex4 tent that such standard or requirement prevents an em5 ployer from instituting the automatic enrollment program 

6 under this section.’’. 

7 SEC. 1512. EMPLOYER REQUIREMENT TO INFORM EMPLOY8 EES OF COVERAGE OPTIONS. 

9 The Fair Labor Standards Act of 1938 is amended 

10 by inserting after section 18A (as added by section 1513) 

11 the following: 

12 ‘‘SEC. 18B. NOTICE TO EMPLOYEES. 

13 ‘‘(a) IN GENERAL.—In accordance with regulations 

14 promulgated by the Secretary, an employer to which this 

15 Act applies, shall provide to each employee at the time 

16 of hiring (or with respect to current employees, not later 

17 than March 1, 2013), written notice— 

18 ‘‘(1) informing the employee of the existence of 

19 an Exchange, including a description of the services 

20 provided by such Exchange, and the manner in 

21 which the employee may contact the Exchange to re22 quest assistance; 

23 ‘‘(2) if the employer plan’s share of the total al24 lowed costs of benefits provided under the plan is 

25 less than 60 percent of such costs, that the employee 


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1 may be eligible for a premium tax credit under sec2 tion 36B of the Internal Revenue Code of 1986 and 

3 a cost sharing reduction under section 1402 of the 

4 Patient Protection and Affordable Care Act if the 

5 employee purchases a qualified health plan through 

6 the Exchange; and 

7 ‘‘(3) if the employee purchases a qualified 

8 health plan through the Exchange, the employee will 

9 lose the employer contribution (if any) to any health 

10 benefits plan offered by the employer and that all or 

11 a portion of such contribution may be excludable 

12 from income for Federal income tax purposes. 

13 ‘‘(b) EFFECTIVE DATE.—Subsection (a) shall take 

14 effect with respect to employers in a State beginning on 

15 March 1, 2013.’’. 

16 SEC. 1513. SHARED RESPONSIBILITY FOR EMPLOYERS. 

17 (a) IN GENERAL.—Chapter 43 of the Internal Rev18 enue Code of 1986 is amended by adding at the end the 

19 following: 

20 ‘‘SEC. 4980H. SHARED RESPONSIBILITY FOR EMPLOYERS 

21 REGARDING HEALTH COVERAGE. 

22 ‘‘(a) LARGE EMPLOYERS NOT OFFERING HEALTH

23 COVERAGE.—If— 

24 ‘‘(1) any applicable large employer fails to offer 

25 to its full-time employees (and their dependents) the 


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1 opportunity to enroll in minimum essential coverage 

2 under an eligible employer-sponsored plan (as de3 fined in section 5000A(f)(2)) for any month, and 

4 ‘‘(2) at least one full-time employee of the ap5 plicable large employer has been certified to the em6 ployer under section 1411 of the Patient Protection 

7 and Affordable Care Act as having enrolled for such 

8 month in a qualified health plan with respect to 

9 which an applicable premium tax credit or cost-shar10 ing reduction is allowed or paid with respect to the 

11 employee, 

12 then there is hereby imposed on the employer an assess13 able payment equal to the product of the applicable pay14 ment amount and the number of individuals employed by 

15 the employer as full-time employees during such month. 

16 ‘‘(b) LARGE EMPLOYERS WITH WAITING PERIODS

17 EXCEEDING 30 DAYS.— 

18 ‘‘(1) IN GENERAL.—In the case of any applica19 ble large employer which requires an extended wait20 ing period to enroll in any minimum essential cov21 erage under an employer-sponsored plan (as defined 

22 in section 5000A(f)(2)), there is hereby imposed on 

23 the employer an assessable payment, in the amount 

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1 ployee of the employer to whom the extended waiting 

2 period applies. 

3 ‘‘(2) AMOUNT.—For purposes of paragraph (1), 

4 the amount specified in this paragraph for a full5 time employee is— 

6 ‘‘(A) in the case of an extended waiting pe7 riod which exceeds 30 days but does not exceed 

8 60 days, $400, and 

9 ‘‘(B) in the case of an extended waiting pe10 riod which exceeds 60 days, $600. 

11 ‘‘(3) EXTENDED WAITING PERIOD.—The term 

12 ‘extended waiting period’ means any waiting period 

13 (as defined in section 2701(b)(4) of the Public 

14 Health Service Act) which exceeds 30 days. 

15 ‘‘(c) LARGE EMPLOYERS OFFERING COVERAGE

16 WITH EMPLOYEES WHO QUALIFY FOR PREMIUM TAX

17 CREDITS OR COST-SHARING REDUCTIONS.— 

18 ‘‘(1) IN GENERAL.—If— 

19 ‘‘(A) an applicable large employer offers to 

20 its full-time employees (and their dependents) 

21 the opportunity to enroll in minimum essential 

22 coverage under an eligible employer-sponsored 

23 plan (as defined in section 5000A(f)(2)) for any 

24 month, and 


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1 ‘‘(B) 1 or more full-time employees of the 

2 applicable large employer has been certified to 

3 the employer under section 1411 of the Patient 

4 Protection and Affordable Care Act as having 

5 enrolled for such month in a qualified health 

6 plan with respect to which an applicable pre7 mium tax credit or cost-sharing reduction is al8 lowed or paid with respect to the employee, 

9 then there is hereby imposed on the employer an as10 sessable payment equal to the product of the number 

11 of full-time employees of the applicable large em12 ployer described in subparagraph (B) for such 

13 month and 400 percent of the applicable payment 

14 amount. 

15 ‘‘(2) OVERALL LIMITATION.—The aggregate 

16 amount of tax determined under paragraph (1) with 

17 respect to all employees of an applicable large em18 ployer for any month shall not exceed the product of 

19 the applicable payment amount and the number of 

20 individuals employed by the employer as full-time 

21 employees during such month. 

22 ‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur23 poses of this section— 


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1 ‘‘(1) APPLICABLE PAYMENT AMOUNT.—The 

2 term ‘applicable payment amount’ means, with respect to any month, 1 3 ⁄12 of $750. 

4 ‘‘(2) APPLICABLE LARGE EMPLOYER.— 

5 ‘‘(A) IN GENERAL.—The term ‘applicable 

6 large employer’ means, with respect to a cal7 endar year, an employer who employed an aver8 age of at least 50 full-time employees on busi9 ness days during the preceding calendar year. 

10 ‘‘(B) EXEMPTION FOR CERTAIN EMPLOY11 ERS.— 

12 ‘‘(i) IN GENERAL.—An employer shall 

13 not be considered to employ more than 50 

14 full-time employees if— 

15 ‘‘(I) the employer’s workforce ex16 ceeds 50 full-time employees for 120 

17 days or fewer during the calendar 

18 year, and 

19 ‘‘(II) the employees in excess of 

20 50 employed during such 120-day pe21 riod were seasonal workers. 

22 ‘‘(ii) DEFINITION OF SEASONAL

23 WORKERS.—The term ‘seasonal worker’ 

24 means a worker who performs labor or 

25 services on a seasonal basis as defined by 


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1 the Secretary of Labor, including workers 

2 covered by section 500.20(s)(1) of title 29, 

3 Code of Federal Regulations and retail 

4 workers employed exclusively during holi5 day seasons. 

6 ‘‘(C) RULES FOR DETERMINING EMPLOYER

7 SIZE.—For purposes of this paragraph— 

8 ‘‘(i) APPLICATION OF AGGREGATION

9 RULE FOR EMPLOYERS.—All persons treat10 ed as a single employer under subsection 

11 (b), (c), (m), or (o) of section 414 of the 

12 Internal Revenue Code of 1986 shall be 

13 treated as 1 employer. 

14 ‘‘(ii) EMPLOYERS NOT IN EXISTENCE

15 IN PRECEDING YEAR.—In the case of an 

16 employer which was not in existence 

17 throughout the preceding calendar year, 

18 the determination of whether such em19 ployer is an applicable large employer shall 

20 be based on the average number of employ21 ees that it is reasonably expected such em22 ployer will employ on business days in the 

23 current calendar year. 

24 ‘‘(iii) PREDECESSORS.—Any reference 

25 in this subsection to an employer shall inVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00353 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 clude a reference to any predecessor of 

2 such employer. 

3 ‘‘(3) APPLICABLE PREMIUM TAX CREDIT AND

4 COST-SHARING REDUCTION.—The term ‘applicable 

5 premium tax credit and cost-sharing reduction’ 

6 means— 

7 ‘‘(A) any premium tax credit allowed under 

8 section 36B, 

9 ‘‘(B) any cost-sharing reduction under sec10 tion 1402 of the Patient Protection and Afford11 able Care Act, and 

12 ‘‘(C) any advance payment of such credit 

13 or reduction under section 1412 of such Act. 

14 ‘‘(4) FULL-TIME EMPLOYEE.— 

15 ‘‘(A) IN GENERAL.—The term ‘full-time 

16 employee’ means an employee who is employed 

17 on average at least 30 hours of service per 

18 week. 

19 ‘‘(B) HOURS OF SERVICE.—The Secretary, 

20 in consultation with the Secretary of Labor, 

21 shall prescribe such regulations, rules, and 

22 guidance as may be necessary to determine the 

23 hours of service of an employee, including rules 

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1 ees who are not compensated on an hourly 

2 basis. 

3 ‘‘(5) INFLATION ADJUSTMENT.— 

4 ‘‘(A) IN GENERAL.—In the case of any cal5 endar year after 2014, each of the dollar 

6 amounts in subsection (b)(2) and (d)(1) shall 

7 be increased by an amount equal to the product 

8 of— 

9 ‘‘(i) such dollar amount, and 

10 ‘‘(ii) the premium adjustment percent11 age (as defined in section 1302(c)(4) of 

12 the Patient Protection and Affordable Care 

13 Act) for the calendar year. 

14 ‘‘(B) ROUNDING.—If the amount of any 

15 increase under subparagraph (A) is not a mul16 tiple of $10, such increase shall be rounded to 

17 the next lowest multiple of $10. 

18 ‘‘(6) OTHER DEFINITIONS.—Any term used in 

19 this section which is also used in the Patient Protec20 tion and Affordable Care Act shall have the same 

21 meaning as when used in such Act. 

22 ‘‘(7) TAX NONDEDUCTIBLE.—For denial of de23 duction for the tax imposed by this section, see sec24 tion 275(a)(6). 

25 ‘‘(e) ADMINISTRATION AND PROCEDURE.— 


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1 ‘‘(1) IN GENERAL.—Any assessable payment 

2 provided by this section shall be paid upon notice 

3 and demand by the Secretary, and shall be assessed 

4 and collected in the same manner as an assessable 

5 penalty under subchapter B of chapter 68. 

6 ‘‘(2) TIME FOR PAYMENT.—The Secretary may 

7 provide for the payment of any assessable payment 

8 provided by this section on an annual, monthly, or 

9 other periodic basis as the Secretary may prescribe. 

10 ‘‘(3) COORDINATION WITH CREDITS, ETC..— 

11 The Secretary shall prescribe rules, regulations, or 

12 guidance for the repayment of any assessable pay13 ment (including interest) if such payment is based 

14 on the allowance or payment of an applicable pre15 mium tax credit or cost-sharing reduction with re16 spect to an employee, such allowance or payment is 

17 subsequently disallowed, and the assessable payment 

18 would not have been required to be made but for 

19 such allowance or payment.’’. 

20 (b) CLERICAL AMENDMENT.—The table of sections 

21 for chapter 43 of such Code is amended by adding at the 

22 end the following new item: 

‘‘Sec. 4980H. Shared responsibility for employers regarding health coverage.’’. 

23 (c) STUDY AND REPORT OF EFFECT OF TAX ON

24 WORKERS’ WAGES.— 


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1 (1) IN GENERAL.—The Secretary of Labor shall 

2 conduct a study to determine whether employees’ 

3 wages are reduced by reason of the application of 

4 the assessable payments under section 4980H of the 

5 Internal Revenue Code of 1986 (as added by the 

6 amendments made by this section). The Secretary 

7 shall make such determination on the basis of the 

8 National Compensation Survey published by the Bu9 reau of Labor Statistics. 

10 (2) REPORT.—The Secretary shall report the 

11 results of the study under paragraph (1) to the 

12 Committee on Ways and Means of the House of 

13 Representatives and to the Committee on Finance of 

14 the Senate. 

15 (d) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to months beginning after Decem17 ber 31, 2013. 

18 SEC. 1514. REPORTING OF EMPLOYER HEALTH INSURANCE 

19 COVERAGE. 

20 (a) IN GENERAL.—Subpart D of part III of sub21 chapter A of chapter 61 of the Internal Revenue Code of 

22 1986, as added by section 1502, is amended by inserting 

23 after section 6055 the following new section: 


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1 ‘‘SEC. 6056. LARGE EMPLOYERS REQUIRED TO REPORT ON 

2 HEALTH INSURANCE COVERAGE. 

3 ‘‘(a) IN GENERAL.—Every applicable large employer 

4 required to meet the requirements of section 4980H with 

5 respect to its full-time employees during a calendar year 

6 shall, at such time as the Secretary may prescribe, make 

7 a return described in subsection (b). 

8 ‘‘(b) FORM AND MANNER OF RETURN.—A return is 

9 described in this subsection if such return— 

10 ‘‘(1) is in such form as the Secretary may pre11 scribe, and 

12 ‘‘(2) contains— 

13 ‘‘(A) the name, date, and employer identi14 fication number of the employer, 

15 ‘‘(B) a certification as to whether the em16 ployer offers to its full-time employees (and 

17 their dependents) the opportunity to enroll in 

18 minimum essential coverage under an eligible 

19 employer-sponsored plan (as defined in section 

20 5000A(f)(2)), 

21 ‘‘(C) if the employer certifies that the em22 ployer did offer to its full-time employees (and 

23 their dependents) the opportunity to so enroll— 

24 ‘‘(i) the length of any waiting period 

25 (as defined in section 2701(b)(4) of the 


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1 Public Health Service Act) with respect to 

2 such coverage, 

3 ‘‘(ii) the months during the calendar 

4 year for which coverage under the plan was 

5 available, 

6 ‘‘(iii) the monthly premium for the 

7 lowest cost option in each of the enroll8 ment categories under the plan, and 

9 ‘‘(iv) the applicable large employer’s 

10 share of the total allowed costs of benefits 

11 provided under the plan, 

12 ‘‘(D) the number of full-time employees for 

13 each month during the calendar year, 

14 ‘‘(E) the name, address, and TIN of each 

15 full-time employee during the calendar year and 

16 the months (if any) during which such employee 

17 (and any dependents) were covered under any 

18 such health benefits plans, and 

19 ‘‘(F) such other information as the Sec20 retary may require. 

21 ‘‘(c) STATEMENTS TO BE FURNISHED TO INDIVID22 UALS WITH RESPECT TO WHOM INFORMATION IS RE23 PORTED.— 

24 ‘‘(1) IN GENERAL.—Every person required to 

25 make a return under subsection (a) shall furnish to 


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1 each full-time employee whose name is required to 

2 be set forth in such return under subsection 

3 (b)(2)(E) a written statement showing— 

4 ‘‘(A) the name and address of the person 

5 required to make such return and the phone 

6 number of the information contact for such per7 son, and 

8 ‘‘(B) the information required to be shown 

9 on the return with respect to such individual. 

10 ‘‘(2) TIME FOR FURNISHING STATEMENTS.— 

11 The written statement required under paragraph (1) 

12 shall be furnished on or before January 31 of the 

13 year following the calendar year for which the return 

14 under subsection (a) was required to be made. 

15 ‘‘(d) COORDINATION WITH OTHER REQUIRE16 MENTS.—To the maximum extent feasible, the Secretary 

17 may provide that— 

18 ‘‘(1) any return or statement required to be 

19 provided under this section may be provided as part 

20 of any return or statement required under section 

21 6051 or 6055, and 

22 ‘‘(2) in the case of an applicable large employer 

23 offering health insurance coverage of a health insur24 ance issuer, the employer may enter into an agree25 ment with the issuer to include information required 


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1 under this section with the return and statement re2 quired to be provided by the issuer under section 

3 6055. 

4 ‘‘(e) COVERAGE PROVIDED BY GOVERNMENTAL

5 UNITS.—In the case of any applicable large employer 

6 which is a governmental unit or any agency or instrumen7 tality thereof, the person appropriately designated for pur8 poses of this section shall make the returns and state9 ments required by this section. 

10 ‘‘(f) DEFINITIONS.—For purposes of this section, any 

11 term used in this section which is also used in section 

12 4980H shall have the meaning given such term by section 

13 4980H.’’. 

14 (b) ASSESSABLE PENALTIES.— 

15 (1) Subparagraph (B) of section 6724(d)(1) of 

16 the Internal Revenue Code of 1986 (relating to defi17 nitions), as amended by section 1502, is amended by 

18 striking ‘‘or’’ at the end of clause (xxiii), by striking 

19 ‘‘and’’ at the end of clause (xxiv) and inserting ‘‘or’’, 

20 and by inserting after clause (xxiv) the following 

21 new clause: 

22 ‘‘(xxv) section 6056 (relating to re23 turns relating to large employers required 

24 to report on health insurance coverage), 

25 and’’. 


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1 (2) Paragraph (2) of section 6724(d) of such 

2 Code, as so amended, is amended by striking ‘‘or’’ 

3 at the end of subparagraph (FF), by striking the pe4 riod at the end of subparagraph (GG) and inserting 

5 ‘‘, or’’ and by inserting after subparagraph (GG) the 

6 following new subparagraph: 

7 ‘‘(HH) section 6056(c) (relating to state8 ments relating to large employers required to 

9 report on health insurance coverage).’’. 

10 (c) CONFORMING AMENDMENT.—The table of sec11 tions for subpart D of part III of subchapter A of chapter 

12 61 of such Code, as added by section 1502, is amended 

13 by adding at the end the following new item: 

‘‘Sec. 6056. Large employers required to report on health insurance coverage.’’. 

14 (d) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to periods beginning after Decem16 ber 31, 2013. 

17 SEC. 1515. OFFERING OF EXCHANGE-PARTICIPATING 

18 QUALIFIED HEALTH PLANS THROUGH CAFE19 TERIA PLANS. 

20 (a) IN GENERAL.—Subsection (f) of section 125 of 

21 the Internal Revenue Code of 1986 is amended by adding 

22 at the end the following new paragraph: 

23 ‘‘(3) CERTAIN EXCHANGE-PARTICIPATING

24 QUALIFIED HEALTH PLANS NOT QUALIFIED.— 


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1 ‘‘(A) IN GENERAL.—The term ‘qualified 

2 benefit’ shall not include any qualified health 

3 plan (as defined in section 1301(a) of the Pa4 tient Protection and Affordable Care Act) of5 fered through an Exchange established under 

6 section 1311 of such Act. 

7 ‘‘(B) EXCEPTION FOR EXCHANGE-ELIGI8 BLE EMPLOYERS.—Subparagraph (A) shall not 

9 apply with respect to any employee if such em10 ployee’s employer is a qualified employer (as de11 fined in section 1312(f)(2) of the Patient Pro12 tection and Affordable Care Act) offering the 

13 employee the opportunity to enroll through such 

14 an Exchange in a qualified health plan in a 

15 group market.’’. 

16 (b) CONFORMING AMENDMENTS.—Subsection (f) of 

17 section 125 of such Code is amended— 

18 (1) by striking ‘‘For purposes of this section, 

19 the term’’ and inserting ‘‘For purposes of this sec20 tion— 

21 ‘‘(1) IN GENERAL.—The term’’, and 

22 (2) by striking ‘‘Such term shall not include’’ 

23 and inserting the following: 


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1 ‘‘(2) LONG-TERM CARE INSURANCE NOT QUALI2 FIED.—The term ‘qualified benefit’ shall not in3 clude’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to taxable years beginning after 

6 December 31, 2013. 

7 Subtitle G—Miscellaneous 

8 Provisions 

9 SEC. 1551. DEFINITIONS. 

10 Unless specifically provided for otherwise, the defini11 tions contained in section 2791 of the Public Health Serv12 ice Act (42 U.S.C. 300gg-91) shall apply with respect to 

13 this title. 

14 SEC. 1552. TRANSPARENCY IN GOVERNMENT. 

15 Not later than 30 days after the date of enactment 

16 of this Act, the Secretary of Health and Human Services 

17 shall publish on the Internet website of the Department 

18 of Health and Human Services, a list of all of the authori19 ties provided to the Secretary under this Act (and the 

20 amendments made by this Act). 

21 SEC. 1553. PROHIBITION AGAINST DISCRIMINATION ON AS22 SISTED SUICIDE. 

23 (a) IN GENERAL.—The Federal Government, and 

24 any State or local government or health care provider that 

25 receives Federal financial assistance under this Act (or 


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1 under an amendment made by this Act) or any health plan 

2 created under this Act (or under an amendment made by 

3 this Act), may not subject an individual or institutional 

4 health care entity to discrimination on the basis that the 

5 entity does not provide any health care item or service fur6 nished for the purpose of causing, or for the purpose of 

7 assisting in causing, the death of any individual, such as 

8 by assisted suicide, euthanasia, or mercy killing. 

9 (b) DEFINITION.—In this section, the term ‘‘health 

10 care entity’’ includes an individual physician or other 

11 health care professional, a hospital, a provider-sponsored 

12 organization, a health maintenance organization, a health 

13 insurance plan, or any other kind of health care facility, 

14 organization, or plan. 

15 (c) CONSTRUCTION AND TREATMENT OF CERTAIN

16 SERVICES.—Nothing in subsection (a) shall be construed 

17 to apply to, or to affect, any limitation relating to— 

18 (1) the withholding or withdrawing of medical 

19 treatment or medical care; 

20 (2) the withholding or withdrawing of nutrition 

21 or hydration; 

22 (3) abortion; or 

23 (4) the use of an item, good, benefit, or service 

24 furnished for the purpose of alleviating pain or dis25 comfort, even if such use may increase the risk of 


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1 death, so long as such item, good, benefit, or service 

2 is not also furnished for the purpose of causing, or 

3 the purpose of assisting in causing, death, for any 

4 reason. 

5 (d) ADMINISTRATION.—The Office for Civil Rights of 

6 the Department of Health and Human Services is des7 ignated to receive complaints of discrimination based on 

8 this section. 

9 SEC. 1554. ACCESS TO THERAPIES. 

10 Notwithstanding any other provision of this Act, the 

11 Secretary of Health and Human Services shall not pro12 mulgate any regulation that— 

13 (1) creates any unreasonable barriers to the 

14 ability of individuals to obtain appropriate medical 

15 care; 

16 (2) impedes timely access to health care serv17 ices; 

18 (3) interferes with communications regarding a 

19 full range of treatment options between the patient 

20 and the provider; 

21 (4) restricts the ability of health care providers 

22 to provide full disclosure of all relevant information 

23 to patients making health care decisions; 


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1 (5) violates the principles of informed consent 

2 and the ethical standards of health care profes3 sionals; or 

4 (6) limits the availability of health care treat5 ment for the full duration of a patient’s medical 

6 needs. 

7 SEC. 1555. FREEDOM NOT TO PARTICIPATE IN FEDERAL 

8 HEALTH INSURANCE PROGRAMS. 

9 No individual, company, business, nonprofit entity, or 

10 health insurance issuer offering group or individual health 

11 insurance coverage shall be required to participate in any 

12 Federal health insurance program created under this Act 

13 (or any amendments made by this Act), or in any Federal 

14 health insurance program expanded by this Act (or any 

15 such amendments), and there shall be no penalty or fine 

16 imposed upon any such issuer for choosing not to partici17 pate in such programs. 

18 SEC. 1556. EQUITY FOR CERTAIN ELIGIBLE SURVIVORS. 

19 (a) REBUTTABLE PRESUMPTION.—Section 411(c)(4) 

20 of the Black Lung Benefits Act (30 U.S.C. 921(c)(4)) is 

21 amended by striking the last sentence. 

22 (b) CONTINUATION OF BENEFITS.—Section 422(l) of 

23 the Black Lung Benefits Act (30 U.S.C. 932(l)) is amend24 ed by striking ‘‘, except with respect to a claim filed under 


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1 this part on or after the effective date of the Black Lung 

2 Benefits Amendments of 1981’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply with respect to claims filed under 

5 part B or part C of the Black Lung Benefits Act (30 

6 U.S.C. 921 et seq., 931 et seq.) after January 1, 2005, 

7 that are pending on or after the date of enactment of this 

8 Act. 

9 SEC. 1557. NONDISCRIMINATION. 

10 (a) IN GENERAL.—Except as otherwise provided for 

11 in this title (or an amendment made by this title), an indi12 vidual shall not, on the ground prohibited under title VI 

13 of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.), 

14 title IX of the Education Amendments of 1972 (20 U.S.C. 

15 1681 et seq.), the Age Discrimination Act of 1975 (42 

16 U.S.C. 6101 et seq.), or section 504 of the Rehabilitation 

17 Act of 1973 (29 U.S.C. 794), be excluded from participa18 tion in, be denied the benefits of, or be subjected to dis19 crimination under, any health program or activity, any 

20 part of which is receiving Federal financial assistance, in21 cluding credits, subsidies, or contracts of insurance, or 

22 under any program or activity that is administered by an 

23 Executive Agency or any entity established under this title 

24 (or amendments). The enforcement mechanisms provided 

25 for and available under such title VI, title IX, section 504, 


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1 or such Age Discrimination Act shall apply for purposes 

2 of violations of this subsection. 

3 (b) CONTINUED APPLICATION OF LAWS.—Nothing in 

4 this title (or an amendment made by this title) shall be 

5 construed to invalidate or limit the rights, remedies, proce6 dures, or legal standards available to individuals aggrieved 

7 under title VI of the Civil Rights Act of 1964 (42 U.S.C. 

8 2000d et seq.), title VII of the Civil Rights Act of 1964 

9 (42 U.S.C. 2000e et seq.), title IX of the Education 

10 Amendments of 1972 (20 U.S.C. 1681 et seq.), section 

11 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794), 

12 or the Age Discrimination Act of 1975 (42 U.S.C. 611 

13 et seq.), or to supersede State laws that provide additional 

14 protections against discrimination on any basis described 

15 in subsection (a). 

16 (c) REGULATIONS.—The Secretary may promulgate 

17 regulations to implement this section. 

18 SEC. 1558. PROTECTIONS FOR EMPLOYEES. 

19 The Fair Labor Standards Act of 1938 is amended 

20 by inserting after section 18B (as added by section 1512) 

21 the following: 

22 ‘‘SEC. 18C. PROTECTIONS FOR EMPLOYEES. 

23 ‘‘(a) PROHIBITION.—No employer shall discharge or 

24 in any manner discriminate against any employee with re25 spect to his or her compensation, terms, conditions, or 


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1 other privileges of employment because the employee (or 

2 an individual acting at the request of the employee) has— 

3 ‘‘(1) received a credit under section 36B of the 

4 Internal Revenue Code of 1986 or a subsidy under 

5 section 1402 of this Act; 

6 ‘‘(2) provided, caused to be provided, or is 

7 about to provide or cause to be provided to the em8 ployer, the Federal Government, or the attorney 

9 general of a State information relating to any viola10 tion of, or any act or omission the employee reason11 ably believes to be a violation of, any provision of 

12 this title (or an amendment made by this title); 

13 ‘‘(3) testified or is about to testify in a pro14 ceeding concerning such violation; 

15 ‘‘(4) assisted or participated, or is about to as16 sist or participate, in such a proceeding; or 

17 ‘‘(5) objected to, or refused to participate in, 

18 any activity, policy, practice, or assigned task that 

19 the employee (or other such person) reasonably be20 lieved to be in violation of any provision of this title 

21 (or amendment), or any order, rule, regulation, 

22 standard, or ban under this title (or amendment). 

23 ‘‘(b) COMPLAINT PROCEDURE.— 

24 ‘‘(1) IN GENERAL.—An employee who believes 

25 that he or she has been discharged or otherwise disVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00370 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 criminated against by any employer in violation of 

2 this section may seek relief in accordance with the 

3 procedures, notifications, burdens of proof, remedies, 

4 and statutes of limitation set forth in section 

5 2087(b) of title 15, United States Code. 

6 ‘‘(2) NO LIMITATION ON RIGHTS.—Nothing in 

7 this section shall be deemed to diminish the rights, 

8 privileges, or remedies of any employee under any 

9 Federal or State law or under any collective bar10 gaining agreement. The rights and remedies in this 

11 section may not be waived by any agreement, policy, 

12 form, or condition of employment.’’. 

13 SEC. 1559. OVERSIGHT. 

14 The Inspector General of the Department of Health 

15 and Human Services shall have oversight authority with 

16 respect to the administration and implementation of this 

17 title as it relates to such Department. 

18 SEC. 1560. RULES OF CONSTRUCTION. 

19 (a) NO EFFECT ON ANTITRUST LAWS.—Nothing in 

20 this title (or an amendment made by this title) shall be 

21 construed to modify, impair, or supersede the operation 

22 of any of the antitrust laws. For the purposes of this sec23 tion, the term ‘‘antitrust laws’’ has the meaning given 

24 such term in subsection (a) of the first section of the Clay25 ton Act, except that such term includes section 5 of the 


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1 Federal Trade Commission Act to the extent that such 

2 section 5 applies to unfair methods of competition. 

3 (b) RULE OF CONSTRUCTION REGARDING HAWAII’S

4 PREPAID HEALTH CARE ACT.—Nothing in this title (or 

5 an amendment made by this title) shall be construed to 

6 modify or limit the application of the exemption for Ha7 waii’s Prepaid Health Care Act (Haw. Rev. Stat. §§ 393- 

8 1 et seq.) as provided for under section 514(b)(5) of the 

9 Employee Retirement Income Security Act of 1974 (29 

10 U.S.C. 1144(b)(5)). 

11 (c) STUDENT HEALTH INSURANCE PLANS.—Nothing 

12 in this title (or an amendment made by this title) shall 

13 be construed to prohibit an institution of higher education 

14 (as such term is defined for purposes of the Higher Edu15 cation Act of 1965) from offering a student health insur16 ance plan, to the extent that such requirement is otherwise 

17 permitted under applicable Federal, State or local law. 

18 (d) NO EFFECT ON EXISTING REQUIREMENTS.— 

19 Nothing in this title (or an amendment made by this title, 

20 unless specified by direct statutory reference) shall be con21 strued to modify any existing Federal requirement con22 cerning the State agency responsible for determining eligi23 bility for programs identified in section 1413. 


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1 SEC. 1561. HEALTH INFORMATION TECHNOLOGY ENROLL2 MENT STANDARDS AND PROTOCOLS. 

3 Title XXX of the Public Health Service Act (42 

4 U.S.C. 300jj et seq.) is amended by adding at the end 

5 the following: 

6 ‘‘Subtitle C—Other Provisions 

7 ‘‘SEC. 3021. HEALTH INFORMATION TECHNOLOGY ENROLL8 MENT STANDARDS AND PROTOCOLS. 

9 ‘‘(a) IN GENERAL.— 

10 ‘‘(1) STANDARDS AND PROTOCOLS.—Not later 

11 than 180 days after the date of enactment of this 

12 title, the Secretary, in consultation with the HIT 

13 Policy Committee and the HIT Standards Com14 mittee, shall develop interoperable and secure stand15 ards and protocols that facilitate enrollment of indi16 viduals in Federal and State health and human serv17 ices programs, as determined by the Secretary. 

18 ‘‘(2) METHODS.—The Secretary shall facilitate 

19 enrollment in such programs through methods deter20 mined appropriate by the Secretary, which shall in21 clude providing individuals and third parties author22 ized by such individuals and their designees notifica23 tion of eligibility and verification of eligibility re24 quired under such programs. 


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1 ‘‘(b) CONTENT.—The standards and protocols for 

2 electronic enrollment in the Federal and State programs 

3 described in subsection (a) shall allow for the following: 

4 ‘‘(1) Electronic matching against existing Fed5 eral and State data, including vital records, employ6 ment history, enrollment systems, tax records, and 

7 other data determined appropriate by the Secretary 

8 to serve as evidence of eligibility and in lieu of 

9 paper-based documentation. 

10 ‘‘(2) Simplification and submission of electronic 

11 documentation, digitization of documents, and sys12 tems verification of eligibility. 

13 ‘‘(3) Reuse of stored eligibility information (in14 cluding documentation) to assist with retention of el15 igible individuals. 

16 ‘‘(4) Capability for individuals to apply, recer17 tify and manage their eligibility information online, 

18 including at home, at points of service, and other 

19 community-based locations. 

20 ‘‘(5) Ability to expand the enrollment system to 

21 integrate new programs, rules, and functionalities, to 

22 operate at increased volume, and to apply stream23 lined verification and eligibility processes to other 

24 Federal and State programs, as appropriate. 


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1 ‘‘(6) Notification of eligibility, recertification, 

2 and other needed communication regarding eligi3 bility, which may include communication via email 

4 and cellular phones. 

5 ‘‘(7) Other functionalities necessary to provide 

6 eligibles with streamlined enrollment process. 

7 ‘‘(c) APPROVAL AND NOTIFICATION.—With respect 

8 to any standard or protocol developed under subsection (a) 

9 that has been approved by the HIT Policy Committee and 

10 the HIT Standards Committee, the Secretary— 

11 ‘‘(1) shall notify States of such standards or 

12 protocols; and 

13 ‘‘(2) may require, as a condition of receiving 

14 Federal funds for the health information technology 

15 investments, that States or other entities incorporate 

16 such standards and protocols into such investments. 

17 ‘‘(d) GRANTS FOR IMPLEMENTATION OF APPRO18 PRIATE ENROLLMENT HIT.— 

19 ‘‘(1) IN GENERAL.—The Secretary shall award 

20 grant to eligible entities to develop new, and adapt 

21 existing, technology systems to implement the HIT 

22 enrollment standards and protocols developed under 

23 subsection (a) (referred to in this subsection as ‘ap24 propriate HIT technology’). 


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1 ‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a 

2 grant under this subsection, an entity shall— 

3 ‘‘(A) be a State, political subdivision of a 

4 State, or a local governmental entity; and 

5 ‘‘(B) submit to the Secretary an applica6 tion at such time, in such manner, and con7 taining— 

8 ‘‘(i) a plan to adopt and implement 

9 appropriate enrollment technology that in10 cludes— 

11 ‘‘(I) proposed reduction in main12 tenance costs of technology systems; 

13 ‘‘(II) elimination or updating of 

14 legacy systems; and 

15 ‘‘(III) demonstrated collaboration 

16 with other entities that may receive a 

17 grant under this section that are lo18 cated in the same State, political sub19 division, or locality; 

20 ‘‘(ii) an assurance that the entity will 

21 share such appropriate enrollment tech22 nology in accordance with paragraph (4); 

23 and 

24 ‘‘(iii) such other information as the 

25 Secretary may require. 


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1 ‘‘(3) SHARING.— 

2 ‘‘(A) IN GENERAL.—The Secretary shall 

3 ensure that appropriate enrollment HIT adopt4 ed under grants under this subsection is made 

5 available to other qualified State, qualified po6 litical subdivisions of a State, or other appro7 priate qualified entities (as described in sub8 paragraph (B)) at no cost. 

9 ‘‘(B) QUALIFIED ENTITIES.—The Sec10 retary shall determine what entities are quali11 fied to receive enrollment HIT under subpara12 graph (A), taking into consideration the rec13 ommendations of the HIT Policy Committee 

14 and the HIT Standards Committee.’’. 

15 SEC. 1562. CONFORMING AMENDMENTS. 

16 (a) APPLICABILITY.—Section 2735 of the Public 

17 Health Service Act (42 U.S.C. 300gg-21), as so redesig18 nated by section 1001(4), is amended— 

19 (1) by striking subsection (a); 

20 (2) in subsection (b)— 

21 (A) in paragraph (1), by striking ‘‘1 

22 through 3’’ and inserting ‘‘1 and 2’’; and 

23 (B) in paragraph (2)— 


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1 (i) in subparagraph (A), by striking 

2 ‘‘subparagraph (D)’’ and inserting ‘‘sub3 paragraph (D) or (E)’’; 

4 (ii) by striking ‘‘1 through 3’’ and in5 serting ‘‘1 and 2’’; and 

6 (iii) by adding at the end the fol7 lowing: 

8 ‘‘(E) ELECTION NOT APPLICABLE.—The 

9 election described in subparagraph (A) shall not 

10 be available with respect to the provisions of 

11 subpart 1.’’; 

12 (3) in subsection (c), by striking ‘‘1 through 3 

13 shall not apply to any group’’ and inserting ‘‘1 and 

14 2 shall not apply to any individual coverage or any 

15 group’’; and 

16 (4) in subsection (d)— 

17 (A) in paragraph (1), by striking ‘‘1 

18 through 3 shall not apply to any group’’ and in19 serting ‘‘1 and 2 shall not apply to any indi20 vidual coverage or any group’’; 

21 (B) in paragraph (2)— 

22 (i) in the matter preceding subpara23 graph (A), by striking ‘‘1 through 3 shall 

24 not apply to any group’’ and inserting ‘‘1 


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1 and 2 shall not apply to any individual cov2 erage or any group’’; and 

3 (ii) in subparagraph (C), by inserting 

4 ‘‘or, with respect to individual coverage, 

5 under any health insurance coverage main6 tained by the same health insurance 

7 issuer’’; and 

8 (C) in paragraph (3), by striking ‘‘any 

9 group’’ and inserting ‘‘any individual coverage 

10 or any group’’. 

11 (b) DEFINITIONS.—Section 2791(d) of the Public 

12 Health Service Act (42 U.S.C. 300gg-91(d)) is amended 

13 by adding at the end the following: 

14 ‘‘(20) QUALIFIED HEALTH PLAN.—The term 

15 ‘qualified health plan’ has the meaning given such 

16 term in section 1301(a) of the Patient Protection 

17 and Affordable Care Act. 

18 ‘‘(21) EXCHANGE.—The term ‘Exchange’ 

19 means an American Health Benefit Exchange estab20 lished under section 1311 of the Patient Protection 

21 and Affordable Care Act.’’. 

22 (c) TECHNICAL AND CONFORMING AMENDMENTS.— 

23 Title XXVII of the Public Health Service Act (42 U.S.C. 

24 300gg et seq.) is amended— 


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1 (1) in section 2704 (42 U.S.C. 300gg), as so 

2 redesignated by section 1201(2)— 

3 (A) in subsection (c)— 

4 (i) in paragraph (2), by striking 

5 ‘‘group health plan’’ each place that such 

6 term appears and inserting ‘‘group or indi7 vidual health plan’’; and 

8 (ii) in paragraph (3)— 

9 (I) by striking ‘‘group health in10 surance’’ each place that such term 

11 appears and inserting ‘‘group or indi12 vidual health insurance’’; and 

13 (II) in subparagraph (D), by 

14 striking ‘‘small or large’’ and insert15 ing ‘‘individual or group’’; 

16 (B) in subsection (d), by striking ‘‘group 

17 health insurance’’ each place that such term ap18 pears and inserting ‘‘group or individual health 

19 insurance’’; and 

20 (C) in subsection (e)(1)(A), by striking 

21 ‘‘group health insurance’’ and inserting ‘‘group 

22 or individual health insurance’’; 

23 (2) by striking the second heading for subpart 

24 2 of part A (relating to other requirements); 


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•AMDT. NO. 2786 

1 (3) in section 2725 (42 U.S.C. 300gg-4), as so 

2 redesignated by section 1001(2)— 

3 (A) in subsection (a), by striking ‘‘health 

4 insurance issuer offering group health insur5 ance coverage’’ and inserting ‘‘health insurance 

6 issuer offering group or individual health insur7 ance coverage’’; 

8 (B) in subsection (b)— 

9 (i) by striking ‘‘health insurance 

10 issuer offering group health insurance cov11 erage in connection with a group health 

12 plan’’ in the matter preceding paragraph 

13 (1) and inserting ‘‘health insurance issuer 

14 offering group or individual health insur15 ance coverage’’; and 

16 (ii) in paragraph (1), by striking 

17 ‘‘plan’’ and inserting ‘‘plan or coverage’’; 

18 (C) in subsection (c)— 

19 (i) in paragraph (2), by striking 

20 ‘‘group health insurance coverage offered 

21 by a health insurance issuer’’ and inserting 

22 ‘‘health insurance issuer offering group or 

23 individual health insurance coverage’’; and 


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•AMDT. NO. 2786 

1 (ii) in paragraph (3), by striking 

2 ‘‘issuer’’ and inserting ‘‘health insurance 

3 issuer’’; and 

4 (D) in subsection (e), by striking ‘‘health 

5 insurance issuer offering group health insur6 ance coverage’’ and inserting ‘‘health insurance 

7 issuer offering group or individual health insur8 ance coverage’’; 

9 (4) in section 2726 (42 U.S.C. 300gg-5), as so 

10 redesignated by section 1001(2)— 

11 (A) in subsection (a), by striking ‘‘(or 

12 health insurance coverage offered in connection 

13 with such a plan)’’ each place that such term 

14 appears and inserting ‘‘or a health insurance 

15 issuer offering group or individual health insur16 ance coverage’’; 

17 (B) in subsection (b), by striking ‘‘(or 

18 health insurance coverage offered in connection 

19 with such a plan)’’ each place that such term 

20 appears and inserting ‘‘or a health insurance 

21 issuer offering group or individual health insur22 ance coverage’’; and 

23 (C) in subsection (c)— 

24 (i) in paragraph (1), by striking ‘‘(and 

25 group health insurance coverage offered in 


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•AMDT. NO. 2786 

1 connection with a group health plan)’’ and 

2 inserting ‘‘and a health insurance issuer 

3 offering group or individual health insur4 ance coverage’’; 

5 (ii) in paragraph (2), by striking ‘‘(or 

6 health insurance coverage offered in con7 nection with such a plan)’’ each place that 

8 such term appears and inserting ‘‘or a 

9 health insurance issuer offering group or 

10 individual health insurance coverage’’; 

11 (5) in section 2727 (42 U.S.C. 300gg-6), as so 

12 redesignated by section 1001(2), by striking ‘‘health 

13 insurance issuers providing health insurance cov14 erage in connection with group health plans’’ and in15 serting ‘‘and health insurance issuers offering group 

16 or individual health insurance coverage’’; 

17 (6) in section 2728 (42 U.S.C. 300gg-7), as so 

18 redesignated by section 1001(2)— 

19 (A) in subsection (a), by striking ‘‘health 

20 insurance coverage offered in connection with 

21 such plan’’ and inserting ‘‘individual health in22 surance coverage’’; 

23 (B) in subsection (b)— 

24 (i) in paragraph (1), by striking ‘‘or a 

25 health insurance issuer that provides 


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•AMDT. NO. 2786 

1 health insurance coverage in connection 

2 with a group health plan’’ and inserting 

3 ‘‘or a health insurance issuer that offers 

4 group or individual health insurance cov5 erage’’; 

6 (ii) in paragraph (2), by striking 

7 ‘‘health insurance coverage offered in con8 nection with the plan’’ and inserting ‘‘indi9 vidual health insurance coverage’’; and 

10 (iii) in paragraph (3), by striking 

11 ‘‘health insurance coverage offered by an 

12 issuer in connection with such plan’’ and 

13 inserting ‘‘individual health insurance cov14 erage’’; 

15 (C) in subsection (c), by striking ‘‘health 

16 insurance issuer providing health insurance cov17 erage in connection with a group health plan’’ 

18 and inserting ‘‘health insurance issuer that of19 fers group or individual health insurance cov20 erage’’; and 

21 (D) in subsection (e)(1), by striking 

22 ‘‘health insurance coverage offered in connec23 tion with such a plan’’ and inserting ‘‘individual 

24 health insurance coverage’’; 

25 (7) by striking the heading for subpart 3; 


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1 (8) in section 2731 (42 U.S.C. 300gg-11), as so 

2 redesignated by section 1001(3)— 

3 (A) by striking the section heading and all 

4 that follows through subsection (b); 

5 (B) in subsection (c)— 

6 (i) in paragraph (1)— 

7 (I) in the matter preceding sub8 paragraph (A), by striking ‘‘small 

9 group’’ and inserting ‘‘group and indi10 vidual’’; and 

11 (II) in subparagraph (B)— 

12 (aa) in the matter preceding 

13 clause (i), by inserting ‘‘and indi14 viduals’’ after ‘‘employers’’; 

15 (bb) in clause (i), by insert16 ing ‘‘or any additional individ17 uals’’ after ‘‘additional groups’’; 

18 and 

19 (cc) in clause (ii), by strik20 ing ‘‘without regard to the claims 

21 experience of those employers 

22 and their employees (and their 

23 dependents) or any health status24 related factor relating to such’’ 

25 and inserting ‘‘and individuals 


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•AMDT. NO. 2786 

1 without regard to the claims ex2 perience of those individuals, em3 ployers and their employees (and 

4 their dependents) or any health 

5 status-related factor relating to 

6 such individuals’’; and 

7 (ii) in paragraph (2), by striking 

8 ‘‘small group’’ and inserting ‘‘group or in9 dividual’’; 

10 (C) in subsection (d)— 

11 (i) by striking ‘‘small group’’ each 

12 place that such appears and inserting 

13 ‘‘group or individual’’; and 

14 (ii) in paragraph (1)(B)— 

15 (I) by striking ‘‘all employers’’ 

16 and inserting ‘‘all employers and indi17 viduals’’; 

18 (II) by striking ‘‘those employ19 ers’’ and inserting ‘‘those individuals, 

20 employers’’; and 

21 (III) by striking ‘‘such employ22 ees’’ and inserting ‘‘such individuals, 

23 employees’’; 

24 (D) by striking subsection (e); 

25 (E) by striking subsection (f); and 


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•AMDT. NO. 2786 

1 (F) by transferring such section (as 

2 amended by this paragraph) to appear at the 

3 end of section 2702 (as added by section 

4 1001(4)); 

5 (9) in section 2732 (42 U.S.C. 300gg-12), as so 

6 redesignated by section 1001(3)— 

7 (A) by striking the section heading and all 

8 that follows through subsection (a); 

9 (B) in subsection (b)— 

10 (i) in the matter preceding paragraph 

11 (1), by striking ‘‘group health plan in the 

12 small or large group market’’ and inserting 

13 ‘‘health insurance coverage offered in the 

14 group or individual market’’; 

15 (ii) in paragraph (1), by inserting ‘‘, 

16 or individual, as applicable,’’ after ‘‘plan 

17 sponsor’’; 

18 (iii) in paragraph (2), by inserting ‘‘, 

19 or individual, as applicable,’’ after ‘‘plan 

20 sponsor’’; and 

21 (iv) by striking paragraph (3) and in22 serting the following: 

23 ‘‘(3) VIOLATION OF PARTICIPATION OR CON24 TRIBUTION RATES.—In the case of a group health 

25 plan, the plan sponsor has failed to comply with a 


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•AMDT. NO. 2786 

1 material plan provision relating to employer con2 tribution or group participation rules, pursuant to 

3 applicable State law.’’; 

4 (C) in subsection (c)— 

5 (i) in paragraph (1)— 

6 (I) in the matter preceding sub7 paragraph (A), by striking ‘‘group 

8 health insurance coverage offered in 

9 the small or large group market’’ and 

10 inserting ‘‘group or individual health 

11 insurance coverage’’; 

12 (II) in subparagraph (A), by in13 serting ‘‘or individual, as applicable,’’ 

14 after ‘‘plan sponsor’’; 

15 (III) in subparagraph (B)— 

16 (aa) by inserting ‘‘or indi17 vidual, as applicable,’’ after ‘‘plan 

18 sponsor’’; and 

19 (bb) by inserting ‘‘or indi20 vidual health insurance cov21 erage’’; and 

22 (IV) in subparagraph (C), by in23 serting ‘‘or individuals, as applicable,’’ 

24 after ‘‘those sponsors’’; and 

25 (ii) in paragraph (2)(A)— 


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•AMDT. NO. 2786 

1 (I) in the matter preceding clause 

2 (i), by striking ‘‘small group market 

3 or the large group market, or both 

4 markets,’’ and inserting ‘‘individual or 

5 group market, or all markets,’’; and 

6 (II) in clause (i), by inserting ‘‘or 

7 individual, as applicable,’’ after ‘‘plan 

8 sponsor’’; and 

9 (D) by transferring such section (as 

10 amended by this paragraph) to appear at the 

11 end of section 2703 (as added by section 

12 1001(4)); 

13 (10) in section 2733 (42 U.S.C. 300gg-13), as 

14 so redesignated by section 1001(4)— 

15 (A) in subsection (a)— 

16 (i) in the matter preceding paragraph 

17 (1), by striking ‘‘small employer’’ and in18 serting ‘‘small employer or an individual’’; 

19 (ii) in paragraph (1), by inserting ‘‘, 

20 or individual, as applicable,’’ after ‘‘em21 ployer’’ each place that such appears; and 

22 (iii) in paragraph (2), by striking 

23 ‘‘small employer’’ and inserting ‘‘employer, 

24 or individual, as applicable,’’; 

25 (B) in subsection (b)— 


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•AMDT. NO. 2786 

1 (i) in paragraph (1)— 

2 (I) in the matter preceding sub3 paragraph (A), by striking ‘‘small em4 ployer’’ and inserting ‘‘employer, or 

5 individual, as applicable,’’; 

6 (II) in subparagraph (A), by add7 ing ‘‘and’’ at the end; 

8 (III) by striking subparagraphs 

9 (B) and (C); and 

10 (IV) in subparagraph (D)— 

11 (aa) by inserting ‘‘, or indi12 vidual, as applicable,’’ after ‘‘em13 ployer’’; and 

14 (bb) by redesignating such 

15 subparagraph as subparagraph 

16 (B); 

17 (ii) in paragraph (2)— 

18 (I) by striking ‘‘small employers’’ 

19 each place that such term appears 

20 and inserting ‘‘employers, or individ21 uals, as applicable,’’; and 

22 (II) by striking ‘‘small employer’’ 

23 and inserting ‘‘employer, or indi24 vidual, as applicable,’’; and 


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1 (C) by redesignating such section (as 

2 amended by this paragraph) as section 2709 

3 and transferring such section to appear after 

4 section 2708 (as added by section 1001(5)); 

5 (11) by redesignating subpart 4 as subpart 2; 

6 (12) in section 2735 (42 U.S.C. 300gg-21), as 

7 so redesignated by section 1001(4)— 

8 (A) by striking subsection (a); 

9 (B) by striking ‘‘subparts 1 through 3’’ 

10 each place that such appears and inserting 

11 ‘‘subpart 1’’; 

12 (C) by redesignating subsections (b) 

13 through (e) as subsections (a) through (d), re14 spectively; and 

15 (D) by redesignating such section (as 

16 amended by this paragraph) as section 2722; 

17 (13) in section 2736 (42 U.S.C. 300gg-22), as 

18 so redesignated by section 1001(4)— 

19 (A) in subsection (a)— 

20 (i) in paragraph (1), by striking 

21 ‘‘small or large group markets’’ and insert22 ing ‘‘individual or group market’’; and 

23 (ii) in paragraph (2), by inserting ‘‘or 

24 individual health insurance coverage’’ after 

25 ‘‘group health plans’’; 


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1 (B) in subsection (b)(1)(B), by inserting 

2 ‘‘individual health insurance coverage or’’ after 

3 ‘‘respect to’’; and 

4 (C) by redesignating such section (as 

5 amended by this paragraph) as section 2723; 

6 (14) in section 2737(a)(1) (42 U.S.C. 300gg7 23), as so redesignated by section 1001(4)— 

8 (A) by inserting ‘‘individual or’’ before 

9 ‘‘group health insurance’’; and 

10 (B) by redesignating such section(as 

11 amended by this paragraph) as section 2724; 

12 (15) in section 2762 (42 U.S.C. 300gg-62)— 

13 (A) in the section heading by inserting 

14 ‘‘AND APPLICATION’’ before the period; and 

15 (B) by adding at the end the following: 

16 ‘‘(c) APPLICATION OF PART A PROVISIONS.— 

17 ‘‘(1) IN GENERAL.—The provisions of part A 

18 shall apply to health insurance issuers providing 

19 health insurance coverage in the individual market 

20 in a State as provided for in such part. 

21 ‘‘(2) CLARIFICATION.—To the extent that any 

22 provision of this part conflicts with a provision of 

23 part A with respect to health insurance issuers pro24 viding health insurance coverage in the individual 


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1 market in a State, the provisions of such part A 

2 shall apply.’’; and 

3 (16) in section 2791(e) (42 U.S.C. 300gg4 91(e))— 

5 (A) in paragraph (2), by striking ‘‘51’’ and 

6 inserting ‘‘101’’; and 

7 (B) in paragraph (4)— 

8 (i) by striking ‘‘at least 2’’ each place 

9 that such appears and inserting ‘‘at least 

10 1’’; and 

11 (ii) by striking ‘‘50’’ and inserting 

12 ‘‘100’’. 

13 (d) APPLICATION.—Notwithstanding any other provi14 sion of the Patient Protection and Affordable Care Act, 

15 nothing in such Act (or an amendment made by such Act) 

16 shall be construed to— 

17 (1) prohibit (or authorize the Secretary of 

18 Health and Human Services to promulgate regula19 tions that prohibit) a group health plan or health in20 surance issuer from carrying out utilization manage21 ment techniques that are commonly used as of the 

22 date of enactment of this Act; or 

23 (2) restrict the application of the amendments 

24 made by this subtitle. 


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1 (e) TECHNICAL AMENDMENT TO THE EMPLOYEE

2 RETIREMENT INCOME SECURITY ACT OF 1974.—Subpart 

3 B of part 7 of subtitle A of title I of the Employee Retire4 ment Income Security Act of 1974 (29 U.S.C. 1181 et. 

5 seq.) is amended, by adding at the end the following: 

6 ‘‘SEC. 715. ADDITIONAL MARKET REFORMS. 

7 ‘‘(a) GENERAL RULE.—Except as provided in sub8 section (b)— 

9 ‘‘(1) the provisions of part A of title XXVII of 

10 the Public Health Service Act (as amended by the 

11 Patient Protection and Affordable Care Act) shall 

12 apply to group health plans, and health insurance 

13 issuers providing health insurance coverage in con14 nection with group health plans, as if included in 

15 this subpart; and 

16 ‘‘(2) to the extent that any provision of this 

17 part conflicts with a provision of such part A with 

18 respect to group health plans, or health insurance 

19 issuers providing health insurance coverage in con20 nection with group health plans, the provisions of 

21 such part A shall apply. 

22 ‘‘(b) EXCEPTION.—Notwithstanding subsection (a), 

23 the provisions of sections 2716 and 2718 of title XXVII 

24 of the Public Health Service Act (as amended by the Pa25 tient Protection and Affordable Care Act) shall not apply 


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1 with respect to self-insured group health plans, and the 

2 provisions of this part shall continue to apply to such 

3 plans as if such sections of the Public Health Service Act 

4 (as so amended) had not been enacted.’’. 

5 (f) TECHNICAL AMENDMENT TO THE INTERNAL

6 REVENUE CODE OF 1986.—Subchapter B of chapter 100 

7 of the Internal Revenue Code of 1986 is amended by add8 ing at the end the following: 

9 ‘‘SEC. 9815. ADDITIONAL MARKET REFORMS. 

10 ‘‘(a) GENERAL RULE.—Except as provided in sub11 section (b)— 

12 ‘‘(1) the provisions of part A of title XXVII of 

13 the Public Health Service Act (as amended by the 

14 Patient Protection and Affordable Care Act) shall 

15 apply to group health plans, and health insurance 

16 issuers providing health insurance coverage in con17 nection with group health plans, as if included in 

18 this subchapter; and 

19 ‘‘(2) to the extent that any provision of this 

20 subchapter conflicts with a provision of such part A 

21 with respect to group health plans, or health insur22 ance issuers providing health insurance coverage in 

23 connection with group health plans, the provisions of 

24 such part A shall apply. 


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1 ‘‘(b) EXCEPTION.—Notwithstanding subsection (a), 

2 the provisions of sections 2716 and 2718 of title XXVII 

3 of the Public Health Service Act (as amended by the Pa4 tient Protection and Affordable Care Act) shall not apply 

5 with respect to self-insured group health plans, and the 

6 provisions of this subchapter shall continue to apply to 

7 such plans as if such sections of the Public Health Service 

8 Act (as so amended) had not been enacted.’’. 

9 TITLE II—ROLE OF PUBLIC 

10 PROGRAMS 

11 Subtitle A—Improved Access to 

12 Medicaid 

13 SEC. 2001. MEDICAID COVERAGE FOR THE LOWEST INCOME 

14 POPULATIONS. 

15 (a) COVERAGE FOR INDIVIDUALS WITH INCOME AT

16 OR BELOW 133 PERCENT OF THE POVERTY LINE.— 

17 (1) BEGINNING 2014.—Section 

18 1902(a)(10)(A)(i) of the Social Security Act (42 

19 U.S.C. 1396a) is amended— 

20 (A) by striking ‘‘or’’ at the end of sub21 clause (VI); 

22 (B) by adding ‘‘or’’ at the end of subclause 

23 (VII); and 

24 (C) by inserting after subclause (VII) the 

25 following: 


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1 ‘‘(VIII) beginning January 1, 

2 2014, who are under 65 years of age, 

3 not pregnant, not entitled to, or en4 rolled for, benefits under part A of 

5 title XVIII, or enrolled for benefits 

6 under part B of title XVIII, and are 

7 not described in a previous subclause 

8 of this clause, and whose income (as 

9 determined under subsection (e)(14)) 

10 does not exceed 133 percent of the 

11 poverty line (as defined in section 

12 2110(c)(5)) applicable to a family of 

13 the size involved, subject to subsection 

14 (k);’’. 

15 (2) PROVISION OF AT LEAST MINIMUM ESSEN16 TIAL COVERAGE.— 

17 (A) IN GENERAL.—Section 1902 of such 

18 Act (42 U.S.C. 1396a) is amended by inserting 

19 after subsection (j) the following: 

20 ‘‘(k)(1) The medical assistance provided to an indi21 vidual described in subclause (VIII) of subsection 

22 (a)(10)(A)(i) shall consist of benchmark coverage de23 scribed in section 1937(b)(1) or benchmark equivalent 

24 coverage described in section 1937(b)(2). Such medical as25 sistance shall be provided subject to the requirements of 


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1 section 1937, without regard to whether a State otherwise 

2 has elected the option to provide medical assistance 

3 through coverage under that section, unless an individual 

4 described in subclause (VIII) of subsection (a)(10)(A)(i) 

5 is also an individual for whom, under subparagraph (B) 

6 of section 1937(a)(2), the State may not require enroll7 ment in benchmark coverage described in subsection 

8 (b)(1) of section 1937 or benchmark equivalent coverage 

9 described in subsection (b)(2) of that section.’’. 

10 (B) CONFORMING AMENDMENT.—Section 

11 1903(i) of the Social Security Act, as amended 

12 by section 6402(c), is amended— 

13 (i) in paragraph (24), by striking ‘‘or’’ 

14 at the end; 

15 (ii) in paragraph (25), by striking the 

16 period and inserting ‘‘; or’’; and 

17 (iii) by adding at the end the fol18 lowing: 

19 ‘‘(26) with respect to any amounts expended for 

20 medical assistance for individuals described in sub21 clause (VIII) of subsection (a)(10)(A)(i) other than 

22 medical assistance provided through benchmark cov23 erage described in section 1937(b)(1) or benchmark 

24 equivalent coverage described in section 

25 1937(b)(2).’’. 


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1 (3) FEDERAL FUNDING FOR COST OF COVERING

2 NEWLY ELIGIBLE INDIVIDUALS.—Section 1905 of 

3 the Social Security Act (42 U.S.C. 1396d), is 

4 amended— 

5 (A) in subsection (b), in the first sentence, 

6 by inserting ‘‘subsection (y) and’’ before ‘‘sec7 tion 1933(d)’’; and 

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

9 subsection: 

10 ‘‘(y) INCREASED FMAP FOR MEDICAL ASSISTANCE

11 FOR NEWLY ELIGIBLE MANDATORY INDIVIDUALS.— 

12 ‘‘(1) AMOUNT OF INCREASE.— 

13 ‘‘(A) 100 PERCENT FMAP.—During the pe14 riod that begins on January 1, 2014, and ends 

15 on December 31, 2016, notwithstanding sub16 section (b), the Federal medical assistance per17 centage determined for a State that is one of 

18 the 50 States or the District of Columbia for 

19 each fiscal year occurring during that period 

20 with respect to amounts expended for medical 

21 assistance for newly eligible individuals de22 scribed in subclause (VIII) of section 

23 1902(a)(10)(A)(i) shall be equal to 100 percent. 

24 ‘‘(B) 2017 AND 2018.— 


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1 ‘‘(i) IN GENERAL.—During the period 

2 that begins on January 1, 2017, and ends 

3 on December 31, 2018, notwithstanding 

4 subsection (b) and subject to subparagraph 

5 (D), the Federal medical assistance per6 centage determined for a State that is one 

7 of the 50 States or the District of Colum8 bia for each fiscal year occurring during 

9 that period with respect to amounts ex10 pended for medical assistance for newly eli11 gible individuals described in subclause 

12 (VIII) of section 1902(a)(10)(A)(i), shall 

13 be increased by the applicable percentage 

14 point increase specified in clause (ii) for 

15 the quarter and the State. 

16 ‘‘(ii) APPLICABLE PERCENTAGE POINT

17 INCREASE.— 

18 ‘‘(I) IN GENERAL.—For purposes 

19 of clause (i), the applicable percentage 

20 point increase for a quarter is the fol21 lowing: 

‘‘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 


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1 ‘‘(II) EXPANSION STATE DE2 FINED.—For purposes of the table in 

3 subclause (I), a State is an expansion 

4 State if, on the date of the enactment 

5 of the Patient Protection and Afford6 able Care Act, the State offers health 

7 benefits coverage statewide to parents 

8 and nonpregnant, childless adults 

9 whose income is at least 100 percent 

10 of the poverty line, that is not depend11 ent on access to employer coverage, 

12 employer contribution, or employment 

13 and is not limited to premium assist14 ance, hospital-only benefits, a high de15 ductible health plan, or alternative 

16 benefits under a demonstration pro17 gram authorized under section 1938. 

18 A State that offers health benefits 

19 coverage to only parents or only non20 pregnant childless adults described in 

21 the preceding sentence shall not be 

22 considered to be an expansion State. 

23 ‘‘(C) 2019 AND SUCCEEDING YEARS.—Be24 ginning January 1, 2019, notwithstanding sub25 section (b) but subject to subparagraph (D), 


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1 the Federal medical assistance percentage de2 termined for a State that is one of the 50 

3 States or the District of Columbia for each fis4 cal year quarter occurring during that period 

5 with respect to amounts expended for medical 

6 assistance for newly eligible individuals de7 scribed in subclause (VIII) of section 

8 1902(a)(10)(A)(i), shall be increased by 32.3 

9 percentage points. 

10 ‘‘(D) LIMITATION.—The Federal medical 

11 assistance percentage determined for a State 

12 under subparagraph (B) or (C) shall in no case 

13 be more than 95 percent. 

14 ‘‘(2) DEFINITIONS.—In this subsection: 

15 ‘‘(A) NEWLY ELIGIBLE.—The term ‘newly 

16 eligible’ means, with respect to an individual de17 scribed in subclause (VIII) of section 

18 1902(a)(10)(A)(i), an individual who is not 

19 under 19 years of age (or such higher age as 

20 the State may have elected) and who, on the 

21 date of enactment of the Patient Protection and 

22 Affordable Care Act, is not eligible under the 

23 State plan or under a waiver of the plan for full 

24 benefits or for benchmark coverage described in 

25 subparagraph (A), (B), or (C) of section 


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1 1937(b)(1) or benchmark equivalent coverage 

2 described in section 1937(b)(2) that has an ag3 gregate actuarial value that is at least actuari4 ally equivalent to benchmark coverage described 

5 in subparagraph (A), (B), or (C) of section 

6 1937(b)(1), or is eligible but not enrolled (or is 

7 on a waiting list) for such benefits or coverage 

8 through a waiver under the plan that has a 

9 capped or limited enrollment that is full. 

10 ‘‘(B) FULL BENEFITS.—The term ‘full 

11 benefits’ means, with respect to an individual, 

12 medical assistance for all services covered under 

13 the State plan under this title that is not less 

14 in amount, duration, or scope, or is determined 

15 by the Secretary to be substantially equivalent, 

16 to the medical assistance available for an indi17 vidual described in section 1902(a)(10)(A)(i).’’. 

18 (4) STATE OPTIONS TO OFFER COVERAGE EAR19 LIER AND PRESUMPTIVE ELIGIBILITY; CHILDREN

20 REQUIRED TO HAVE COVERAGE FOR PARENTS TO BE

21 ELIGIBLE.— 

22 (A) IN GENERAL.—Subsection (k) of sec23 tion 1902 of the Social Security Act (as added 

24 by paragraph (2)), is amended by inserting 

25 after paragraph (1) the following: 


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1 ‘‘(2) Beginning with the first day of any fiscal year 

2 quarter that begins on or after January 1, 2011, and be3 fore January 1, 2014, a State may elect through a State 

4 plan amendment to provide medical assistance to individ5 uals who would be described in subclause (VIII) of sub6 section (a)(10)(A)(i) if that subclause were effective before 

7 January 1, 2014. A State may elect to phase-in the exten8 sion of eligibility for medical assistance to such individuals 

9 based on income, so long as the State does not extend 

10 such eligibility to individuals described in such subclause 

11 with higher income before making individuals described in 

12 such subclause with lower income eligible for medical as13 sistance. 

14 ‘‘(3) If an individual described in subclause (VIII) of 

15 subsection (a)(10)(A)(i) is the parent of a child who is 

16 under 19 years of age (or such higher age as the State 

17 may have elected) who is eligible for medical assistance 

18 under the State plan or under a waiver of such plan 

19 (under that subclause or under a State plan amendment 

20 under paragraph (2), the individual may not be enrolled 

21 under the State plan unless the individual’s child is en22 rolled under the State plan or under a waiver of the plan 

23 or is enrolled in other health insurance coverage. For pur24 poses of the preceding sentence, the term ‘parent’ includes 


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1 an individual treated as a caretaker relative for purposes 

2 of carrying out section 1931.’’. 

3 (B) PRESUMPTIVE ELIGIBILITY.—Section 

4 1920 of the Social Security Act (42 U.S.C. 

5 1396r–1) is amended by adding at the end the 

6 following: 

7 ‘‘(e) If the State has elected the option to provide 

8 a presumptive eligibility period under this section or sec9 tion 1920A, the State may elect to provide a presumptive 

10 eligibility period (as defined in subsection (b)(1)) for indi11 viduals who are eligible for medical assistance under 

12 clause (i)(VIII) of subsection (a)(10)(A) or section 1931 

13 in the same manner as the State provides for such a pe14 riod under this section or section 1920A, subject to such 

15 guidance as the Secretary shall establish.’’. 

16 (5) CONFORMING AMENDMENTS.— 

17 (A) Section 1902(a)(10) of such Act (42 

18 U.S.C. 1396a(a)(10)) is amended in the matter 

19 following subparagraph (G), by striking ‘‘and 

20 (XIV)’’ and inserting ‘‘(XIV)’’ and by inserting 

21 ‘‘and (XV) the medical assistance made avail22 able to an individual described in subparagraph 

23 (A)(i)(VIII) shall be limited to medical assist24 ance described in subsection (k)(1)’’ before the 

25 semicolon. 


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1 (B) Section 1902(l)(2)(C) of such Act (42 

2 U.S.C. 1396a(l)(2)(C)) is amended by striking 

3 ‘‘100’’ and inserting ‘‘133’’. 

4 (C) Section 1905(a) of such Act (42 

5 U.S.C. 1396d(a)) is amended in the matter pre6 ceding paragraph (1)— 

7 (i) by striking ‘‘or’’ at the end of 

8 clause (xii); 

9 (ii) by inserting ‘‘or’’ at the end of 

10 clause (xiii); and 

11 (iii) by inserting after clause (xiii) the 

12 following: 

13 ‘‘(xiv) individuals described in section 

14 1902(a)(10)(A)(i)(VIII),’’. 

15 (D) Section 1903(f)(4) of such Act (42 

16 U.S.C. 1396b(f)(4)) is amended by inserting 

17 ‘‘1902(a)(10)(A)(i)(VIII),’’ after 

18 ‘‘1902(a)(10)(A)(i)(VII),’’. 

19 (E) Section 1937(a)(1)(B) of such Act (42 

20 U.S.C. 1396u–7(a)(1)(B)) is amended by in21 serting ‘‘subclause (VIII) of section 

22 1902(a)(10)(A)(i) or under’’ after ‘‘eligible 

23 under’’. 


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1 (b) MAINTENANCE OF MEDICAID INCOME ELIGI2 BILITY.—Section 1902 of the Social Security Act (42 

3 U.S.C. 1396a) is amended— 

4 (1) in subsection (a)— 

5 (A) by striking ‘‘and’’ at the end of para6 graph (72); 

7 (B) by striking the period at the end of 

8 paragraph (73) and inserting ‘‘; and’’; and 

9 (C) by inserting after paragraph (73) the 

10 following new paragraph: 

11 ‘‘(74) provide for maintenance of effort under 

12 the State plan or under any waiver of the plan in 

13 accordance with subsection (gg).’’; and 

14 (2) by adding at the end the following new sub15 section: 

16 ‘‘(gg) MAINTENANCE OF EFFORT.— 

17 ‘‘(1) GENERAL REQUIREMENT TO MAINTAIN

18 ELIGIBILITY STANDARDS UNTIL STATE EXCHANGE IS

19 FULLY OPERATIONAL.—Subject to the succeeding 

20 paragraphs of this subsection, during the period that 

21 begins on the date of enactment of the Patient Pro22 tection and Affordable Care Act and ends on the 

23 date on which the Secretary determines that an Ex24 change established by the State under section 1311 

25 of the Patient Protection and Affordable Care Act is 


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1 fully operational, as a condition for receiving any 

2 Federal payments under section 1903(a) for cal3 endar quarters occurring during such period, a State 

4 shall not have in effect eligibility standards, meth5 odologies, or procedures under the State plan under 

6 this title or under any waiver of such plan that is 

7 in effect during that period, that are more restrictive 

8 than the eligibility standards, methodologies, or pro9 cedures, respectively, under the plan or waiver that 

10 are in effect on the date of enactment of the Patient 

11 Protection and Affordable Care Act. 

12 ‘‘(2) CONTINUATION OF ELIGIBILITY STAND13 ARDS FOR CHILDREN UNTIL OCTOBER 1, 2019.—The 

14 requirement under paragraph (1) shall continue to 

15 apply to a State through September 30, 2019, with 

16 respect to the eligibility standards, methodologies, 

17 and procedures under the State plan under this title 

18 or under any waiver of such plan that are applicable 

19 to determining the eligibility for medical assistance 

20 of any child who is under 19 years of age (or such 

21 higher age as the State may have elected). 

22 ‘‘(3) NONAPPLICATION.—During the period 

23 that begins on January 1, 2011, and ends on De24 cember 31, 2013, the requirement under paragraph 

25 (1) shall not apply to a State with respect to nonVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00408 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pregnant, nondisabled adults who are eligible for 

2 medical assistance under the State plan or under a 

3 waiver of the plan at the option of the State and 

4 whose income exceeds 133 percent of the poverty 

5 line (as defined in section 2110(c)(5)) applicable to 

6 a family of the size involved if, on or after December 

7 31, 2010, the State certifies to the Secretary that, 

8 with respect to the State fiscal year during which 

9 the certification is made, the State has a budget def10 icit, or with respect to the succeeding State fiscal 

11 year, the State is projected to have a budget deficit. 

12 Upon submission of such a certification to the Sec13 retary, the requirement under paragraph (1) shall 

14 not apply to the State with respect to any remaining 

15 portion of the period described in the preceding sen16 tence. 

17 ‘‘(4) DETERMINATION OF COMPLIANCE.— 

18 ‘‘(A) STATES SHALL APPLY MODIFIED

19 GROSS INCOME.—A State’s determination of in20 come in accordance with subsection (e)(14) 

21 shall not be considered to be eligibility stand22 ards, methodologies, or procedures that are 

23 more restrictive than the standards, methodolo24 gies, or procedures in effect under the State 

25 plan or under a waiver of the plan on the date 


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1 of enactment of the Patient Protection and Af2 fordable Care Act for purposes of determining 

3 compliance with the requirements of paragraph 

4 (1), (2), or (3). 

5 ‘‘(B) STATES MAY EXPAND ELIGIBILITY OR

6 MOVE WAIVERED POPULATIONS INTO COVERAGE

7 UNDER THE STATE PLAN.—With respect to any 

8 period applicable under paragraph (1), (2), or 

9 (3), a State that applies eligibility standards, 

10 methodologies, or procedures under the State 

11 plan under this title or under any waiver of the 

12 plan that are less restrictive than the eligibility 

13 standards, methodologies, or procedures, ap14 plied under the State plan or under a waiver of 

15 the plan on the date of enactment of the Pa16 tient Protection and Affordable Care Act, or 

17 that makes individuals who, on such date of en18 actment, are eligible for medical assistance 

19 under a waiver of the State plan, after such 

20 date of enactment eligible for medical assistance 

21 through a State plan amendment with an in22 come eligibility level that is not less than the in23 come eligibility level that applied under the 

24 waiver, or as a result of the application of sub25 clause (VIII) of section 1902(a)(10)(A)(i), shall 


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1 not be considered to have in effect eligibility 

2 standards, methodologies, or procedures that 

3 are more restrictive than the standards, meth4 odologies, or procedures in effect under the 

5 State plan or under a waiver of the plan on the 

6 date of enactment of the Patient Protection and 

7 Affordable Care Act for purposes of deter8 mining compliance with the requirements of 

9 paragraph (1), (2), or (3).’’. 

10 (c) MEDICAID BENCHMARK BENEFITS MUST CON11 SIST OF AT LEAST MINIMUM ESSENTIAL COVERAGE.— 

12 Section 1937(b) of such Act (42 U.S.C. 1396u–7(b)) is 

13 amended— 

14 (1) in paragraph (1), in the matter preceding 

15 subparagraph (A), by inserting ‘‘subject to para16 graphs (5) and (6),’’ before ‘‘each’’; 

17 (2) in paragraph (2)— 

18 (A) in the matter preceding subparagraph 

19 (A), by inserting ‘‘subject to paragraphs (5) 

20 and (6)’’ after ‘‘subsection (a)(1),’’; 

21 (B) in subparagraph (A)— 

22 (i) by redesignating clauses (iv) and 

23 (v) as clauses (vi) and (vii), respectively; 

24 and 


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1 (ii) by inserting after clause (iii), the 

2 following: 

3 ‘‘(iv) Coverage of prescription drugs. 

4 ‘‘(v) Mental health services.’’; and 

5 (C) in subparagraph (C)— 

6 (i) by striking clauses (i) and (ii); and 

7 (ii) by redesignating clauses (iii) and 

8 (iv) as clauses (i) and (ii), respectively; and 

9 (3) by adding at the end the following new 

10 paragraphs: 

11 ‘‘(5) MINIMUM STANDARDS.—Effective January 

12 1, 2014, any benchmark benefit package under para13 graph (1) or benchmark equivalent coverage under 

14 paragraph (2) must provide at least essential health 

15 benefits as described in section 1302(b) of the Pa16 tient Protection and Affordable Care Act. 

17 ‘‘(6) MENTAL HEALTH SERVICES PARITY.— 

18 ‘‘(A) IN GENERAL.—In the case of any 

19 benchmark benefit package under paragraph 

20 (1) or benchmark equivalent coverage under 

21 paragraph (2) that is offered by an entity that 

22 is not a medicaid managed care organization 

23 and that provides both medical and surgical 

24 benefits and mental health or substance use dis25 order benefits, the entity shall ensure that the 


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1 financial requirements and treatment limita2 tions applicable to such mental health or sub3 stance use disorder benefits comply with the re4 quirements of section 2705(a) of the Public 

5 Health Service Act in the same manner as such 

6 requirements apply to a group health plan. 

7 ‘‘(B) DEEMED COMPLIANCE.—Coverage 

8 provided with respect to an individual described 

9 in section 1905(a)(4)(B) and covered under the 

10 State plan under section 1902(a)(10)(A) of the 

11 services described in section 1905(a)(4)(B) (re12 lating to early and periodic screening, diag13 nostic, and treatment services defined in section 

14 1905(r)) and provided in accordance with sec15 tion 1902(a)(43), shall be deemed to satisfy the 

16 requirements of subparagraph (A).’’. 

17 (d) ANNUAL REPORTS ON MEDICAID ENROLL18 MENT.— 

19 (1) STATE REPORTS.—Section 1902(a) of the 

20 Social Security Act (42 U.S.C. 1396a(a)), as amend21 ed by subsection (b), is amended— 

22 (A) by striking ‘‘and’’ at the end of para23 graph (73); 

24 (B) by striking the period at the end of 

25 paragraph (74) and inserting ‘‘; and’’; and 


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1 (C) by inserting after paragraph (74) the 

2 following new paragraph: 

3 ‘‘(75) provide that, beginning January 2015, 

4 and annually thereafter, the State shall submit a re5 port to the Secretary that contains— 

6 ‘‘(A) the total number of enrolled and 

7 newly enrolled individuals in the State plan or 

8 under a waiver of the plan for the fiscal year 

9 ending on September 30 of the preceding cal10 endar year, disaggregated by population, includ11 ing children, parents, nonpregnant childless 

12 adults, disabled individuals, elderly individuals, 

13 and such other categories or sub-categories of 

14 individuals eligible for medical assistance under 

15 the State plan or under a waiver of the plan as 

16 the Secretary may require; 

17 ‘‘(B) a description, which may be specified 

18 by population, of the outreach and enrollment 

19 processes used by the State during such fiscal 

20 year; and 

21 ‘‘(C) any other data reporting determined 

22 necessary by the Secretary to monitor enroll23 ment and retention of individuals eligible for 

24 medical assistance under the State plan or 

25 under a waiver of the plan.’’. 


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1 (2) REPORTS TO CONGRESS.—Beginning April 

2 2015, and annually thereafter, the Secretary of 

3 Health and Human Services shall submit a report to 

4 the appropriate committees of Congress on the total 

5 enrollment and new enrollment in Medicaid for the 

6 fiscal year ending on September 30 of the preceding 

7 calendar year on a national and State-by-State 

8 basis, and shall include in each such report such rec9 ommendations for administrative or legislative 

10 changes to improve enrollment in the Medicaid pro11 gram as the Secretary determines appropriate. 

12 (e) STATE OPTION FOR COVERAGE FOR INDIVIDUALS

13 WITH INCOME THAT EXCEEDS 133 PERCENT OF THE

14 POVERTY LINE.— 

15 (1) COVERAGE AS OPTIONAL CATEGORICALLY

16 NEEDY GROUP.—Section 1902 of the Social Security 

17 Act (42 U.S.C. 1396a) is amended— 

18 (A) in subsection (a)(10)(A)(ii)— 

19 (i) in subclause (XVIII), by striking 

20 ‘‘or’’ at the end; 

21 (ii) in subclause (XIX), by adding 

22 ‘‘or’’ at the end; and 

23 (iii) by adding at the end the fol24 lowing new subclause: 


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1 ‘‘(XX) beginning January 1, 

2 2014, who are under 65 years of age 

3 and are not described in or enrolled 

4 under a previous subclause of this 

5 clause, and whose income (as deter6 mined under subsection (e)(14)) ex7 ceeds 133 percent of the poverty line 

8 (as defined in section 2110(c)(5)) ap9 plicable to a family of the size in10 volved but does not exceed the highest 

11 income eligibility level established 

12 under the State plan or under a waiv13 er of the plan, subject to subsection 

14 (hh);’’ and 

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

16 subsection: 

17 ‘‘(hh)(1) A State may elect to phase-in the extension 

18 of eligibility for medical assistance to individuals described 

19 in subclause (XX) of subsection (a)(10)(A)(ii) based on 

20 the categorical group (including nonpregnant childless 

21 adults) or income, so long as the State does not extend 

22 such eligibility to individuals described in such subclause 

23 with higher income before making individuals described in 

24 such subclause with lower income eligible for medical as25 sistance. 


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1 ‘‘(2) If an individual described in subclause (XX) of 

2 subsection (a)(10)(A)(ii) is the parent of a child who is 

3 under 19 years of age (or such higher age as the State 

4 may have elected) who is eligible for medical assistance 

5 under the State plan or under a waiver of such plan, the 

6 individual may not be enrolled under the State plan unless 

7 the individual’s child is enrolled under the State plan or 

8 under a waiver of the plan or is enrolled in other health 

9 insurance coverage. For purposes of the preceding sen10 tence, the term ‘parent’ includes an individual treated as 

11 a caretaker relative for purposes of carrying out section 

12 1931.’’. 

13 (2) CONFORMING AMENDMENTS.— 

14 (A) Section 1905(a) of such Act (42 

15 U.S.C. 1396d(a)), as amended by subsection 

16 (a)(5)(C), is amended in the matter preceding 

17 paragraph (1)— 

18 (i) by striking ‘‘or’’ at the end of 

19 clause (xiii); 

20 (ii) by inserting ‘‘or’’ at the end of 

21 clause (xiv); and 

22 (iii) by inserting after clause (xiv) the 

23 following: 

24 ‘‘(xv) individuals described in section 

25 1902(a)(10)(A)(ii)(XX),’’. 


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1 (B) Section 1903(f)(4) of such Act (42 

2 U.S.C. 1396b(f)(4)) is amended by inserting 

3 ‘‘1902(a)(10)(A)(ii)(XX),’’ after 

4 ‘‘1902(a)(10)(A)(ii)(XIX),’’. 

5 (C) Section 1920(e) of such Act (42 

6 U.S.C. 1396r–1(e)), as added by subsection 

7 (a)(4)(B), is amended by inserting ‘‘or clause 

8 (ii)(XX)’’ after ‘‘clause (i)(VIII)’’. 

9 SEC. 2002. INCOME ELIGIBILITY FOR NONELDERLY DETER10 MINED USING MODIFIED GROSS INCOME. 

11 (a) IN GENERAL.—Section 1902(e) of the Social Se12 curity Act (42 U.S.C. 1396a(e)) is amended by adding at 

13 the end the following: 

14 ‘‘(14) INCOME DETERMINED USING MODIFIED

15 GROSS INCOME.— 

16 ‘‘(A) IN GENERAL.—Notwithstanding sub17 section (r) or any other provision of this title, 

18 except as provided in subparagraph (D), for 

19 purposes of determining income eligibility for 

20 medical assistance under the State plan or 

21 under any waiver of such plan and for any 

22 other purpose applicable under the plan or 

23 waiver for which a determination of income is 

24 required, including with respect to the imposi25 tion of premiums and cost-sharing, a State 


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1 shall use the modified gross income of an indi2 vidual and, in the case of an individual in a 

3 family greater than 1, the household income of 

4 such family. A State shall establish income eli5 gibility thresholds for populations to be eligible 

6 for medical assistance under the State plan or 

7 a waiver of the plan using modified gross in8 come and household income that are not less 

9 than the effective income eligibility levels that 

10 applied under the State plan or waiver on the 

11 date of enactment of the Patient Protection and 

12 Affordable Care Act. For purposes of complying 

13 with the maintenance of effort requirements 

14 under subsection (gg) during the transition to 

15 modified gross income and household income, a 

16 State shall, working with the Secretary, estab17 lish an equivalent income test that ensures indi18 viduals eligible for medical assistance under the 

19 State plan or under a waiver of the plan on the 

20 date of enactment of the Patient Protection and 

21 Affordable Care Act, do not lose coverage under 

22 the State plan or under a waiver of the plan. 

23 The Secretary may waive such provisions of this 

24 title and title XXI as are necessary to ensure 


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1 that States establish income and eligibility de2 termination systems that protect beneficiaries. 

3 ‘‘(B) NO INCOME OR EXPENSE DIS4 REGARDS.—No type of expense, block, or other 

5 income disregard shall be applied by a State to 

6 determine income eligibility for medical assist7 ance under the State plan or under any waiver 

8 of such plan or for any other purpose applicable 

9 under the plan or waiver for which a determina10 tion of income is required. 

11 ‘‘(C) NO ASSETS TEST.—A State shall not 

12 apply any assets or resources test for purposes 

13 of determining eligibility for medical assistance 

14 under the State plan or under a waiver of the 

15 plan. 

16 ‘‘(D) EXCEPTIONS.— 

17 ‘‘(i) INDIVIDUALS ELIGIBLE BECAUSE

18 OF OTHER AID OR ASSISTANCE, ELDERLY

19 INDIVIDUALS, MEDICALLY NEEDY INDIVID20 UALS, AND INDIVIDUALS ELIGIBLE FOR

21 MEDICARE COST-SHARING.—Subpara22 graphs (A), (B), and (C) shall not apply to 

23 the determination of eligibility under the 

24 State plan or under a waiver for medical 

25 assistance for the following: 


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1 ‘‘(I) Individuals who are eligible 

2 for medical assistance under the State 

3 plan or under a waiver of the plan on 

4 a basis that does not require a deter5 mination of income by the State agen6 cy administering the State plan or 

7 waiver, including as a result of eligi8 bility for, or receipt of, other Federal 

9 or State aid or assistance, individuals 

10 who are eligible on the basis of receiv11 ing (or being treated as if receiving) 

12 supplemental security income benefits 

13 under title XVI, and individuals who 

14 are eligible as a result of being or 

15 being deemed to be a child in foster 

16 care under the responsibility of the 

17 State. 

18 ‘‘(II) Individuals who have at19 tained age 65. 

20 ‘‘(III) Individuals who qualify for 

21 medical assistance under the State 

22 plan or under any waiver of such plan 

23 on the basis of being blind or disabled 

24 (or being treated as being blind or 

25 disabled) without regard to whether 


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1 the individual is eligible for supple2 mental security income benefits under 

3 title XVI on the basis of being blind 

4 or disabled and including an indi5 vidual who is eligible for medical as6 sistance on the basis of section 

7 1902(e)(3). 

8 ‘‘(IV) Individuals described in 

9 subsection (a)(10)(C). 

10 ‘‘(V) Individuals described in any 

11 clause of subsection (a)(10)(E). 

12 ‘‘(ii) EXPRESS LANE AGENCY FIND13 INGS.—In the case of a State that elects 

14 the Express Lane option under paragraph 

15 (13), notwithstanding subparagraphs (A), 

16 (B), and (C), the State may rely on a find17 ing made by an Express Lane agency in 

18 accordance with that paragraph relating to 

19 the income of an individual for purposes of 

20 determining the individual’s eligibility for 

21 medical assistance under the State plan or 

22 under a waiver of the plan. 

23 ‘‘(iii) MEDICARE PRESCRIPTION DRUG

24 SUBSIDIES DETERMINATIONS.—Subpara25 graphs (A), (B), and (C) shall not apply to 


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1 any determinations of eligibility for pre2 mium and cost-sharing subsidies under 

3 and in accordance with section 1860D–14 

4 made by the State pursuant to section 

5 1935(a)(2). 

6 ‘‘(iv) LONG-TERM CARE.—Subpara7 graphs (A), (B), and (C) shall not apply to 

8 any determinations of eligibility of individ9 uals for purposes of medical assistance for 

10 nursing facility services, a level of care in 

11 any institution equivalent to that of nurs12 ing facility services, home or community13 based services furnished under a waiver or 

14 State plan amendment under section 1915 

15 or a waiver under section 1115, and serv16 ices described in section 1917(c)(1)(C)(ii). 

17 ‘‘(v) GRANDFATHER OF CURRENT EN18 ROLLEES UNTIL DATE OF NEXT REGULAR

19 REDETERMINATION.—An individual who, 

20 on January 1, 2014, is enrolled in the 

21 State plan or under a waiver of the plan 

22 and who would be determined ineligible for 

23 medical assistance solely because of the ap24 plication of the modified gross income or 

25 household income standard described in 


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1 subparagraph (A), shall remain eligible for 

2 medical assistance under the State plan or 

3 waiver (and subject to the same premiums 

4 and cost-sharing as applied to the indi5 vidual on that date) through March 31, 

6 2014, or the date on which the individual’s 

7 next regularly scheduled redetermination of 

8 eligibility is to occur, whichever is later. 

9 ‘‘(E) TRANSITION PLANNING AND OVER10 SIGHT.—Each State shall submit to the Sec11 retary for the Secretary’s approval the income 

12 eligibility thresholds proposed to be established 

13 using modified gross income and household in14 come, the methodologies and procedures to be 

15 used to determine income eligibility using modi16 fied gross income and household income and, if 

17 applicable, a State plan amendment establishing 

18 an optional eligibility category under subsection 

19 (a)(10)(A)(ii)(XX). To the extent practicable, 

20 the State shall use the same methodologies and 

21 procedures for purposes of making such deter22 minations as the State used on the date of en23 actment of the Patient Protection and Afford24 able Care Act. The Secretary shall ensure that 

25 the income eligibility thresholds proposed to be 


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1 established using modified gross income and 

2 household income, including under the eligibility 

3 category established under subsection 

4 (a)(10)(A)(ii)(XX), and the methodologies and 

5 procedures proposed to be used to determine in6 come eligibility, will not result in children who 

7 would have been eligible for medical assistance 

8 under the State plan or under a waiver of the 

9 plan on the date of enactment of the Patient 

10 Protection and Affordable Care Act no longer 

11 being eligible for such assistance. 

12 ‘‘(F) LIMITATION ON SECRETARIAL AU13 THORITY.—The Secretary shall not waive com14 pliance with the requirements of this paragraph 

15 except to the extent necessary to permit a State 

16 to coordinate eligibility requirements for dual 

17 eligible individuals (as defined in section 

18 1915(h)(2)(B)) under the State plan or under 

19 a waiver of the plan and under title XVIII and 

20 individuals who require the level of care pro21 vided in a hospital, a nursing facility, or an in22 termediate care facility for the mentally re23 tarded. 

24 ‘‘(G) DEFINITIONS OF MODIFIED GROSS

25 INCOME AND HOUSEHOLD INCOME.—In this 


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1 paragraph, the terms ‘modified gross income’ 

2 and ‘household income’ have the meanings 

3 given such terms in section 36B(d)(2) of the 

4 Internal Revenue Code of 1986. 

5 ‘‘(H) CONTINUED APPLICATION OF MED6 ICAID RULES REGARDING POINT-IN-TIME IN7 COME AND SOURCES OF INCOME.—The require8 ment under this paragraph for States to use 

9 modified gross income and household income to 

10 determine income eligibility for medical assist11 ance under the State plan or under any waiver 

12 of such plan and for any other purpose applica13 ble under the plan or waiver for which a deter14 mination of income is required shall not be con15 strued as affecting or limiting the application 

16 of— 

17 ‘‘(i) the requirement under this title 

18 and under the State plan or a waiver of 

19 the plan to determine an individual’s in20 come as of the point in time at which an 

21 application for medical assistance under 

22 the State plan or a waiver of the plan is 

23 processed; or 

24 ‘‘(ii) any rules established under this 

25 title or under the State plan or a waiver of 


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1 the plan regarding sources of countable in2 come.’’. 

3 (b) CONFORMING AMENDMENT.—Section 

4 1902(a)(17) of such Act (42 U.S.C. 1396a(a)(17)) is 

5 amended by inserting ‘‘(e)(14),’’ before ‘‘(l)(3)’’. 

6 (c) EFFECTIVE DATE.—The amendments made by 

7 subsections (a) and (b) take effect on January 1, 2014. 

8 SEC. 2003. REQUIREMENT TO OFFER PREMIUM ASSIST9 ANCE FOR EMPLOYER-SPONSORED INSUR10 ANCE. 

11 (a) IN GENERAL.—Section 1906A of such Act (42 

12 U.S.C. 1396e–1) is amended— 

13 (1) in subsection (a)— 

14 (A) by striking ‘‘may elect to’’ and insert15 ing ‘‘shall’’; 

16 (B) by striking ‘‘under age 19’’; and 

17 (C) by inserting ‘‘, in the case of an indi18 vidual under age 19,’’ after ‘‘(and’’; 

19 (2) in subsection (c), in the first sentence, by 

20 striking ‘‘under age 19’’; and 

21 (3) in subsection (d)— 

22 (A) in paragraph (2)— 

23 (i) in the first sentence, by striking 

24 ‘‘under age 19’’; and 


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1 (ii) by striking the third sentence and 

2 inserting ‘‘A State may not require, as a 

3 condition of an individual (or the individ4 ual’s parent) being or remaining eligible 

5 for medical assistance under this title, that 

6 the individual (or the individual’s parent) 

7 apply for enrollment in qualified employer8 sponsored coverage under this section.’’; 

9 and 

10 (B) in paragraph (3), by striking ‘‘the par11 ent of an individual under age 19’’ and insert12 ing ‘‘an individual (or the parent of an indi13 vidual)’’; and 

14 (4) in subsection (e), by striking ‘‘under age 

15 19’’ each place it appears. 

16 (b) CONFORMING AMENDMENT.—The heading for 

17 section 1906A of such Act (42 U.S.C. 1396e–1) is amend18 ed by striking ‘‘OPTION FOR CHILDREN’’. 

19 (c) EFFECTIVE DATE.—The amendments made by 

20 this section take effect on January 1, 2014. 

21 SEC. 2004. MEDICAID COVERAGE FOR FORMER FOSTER 

22 CARE CHILDREN. 

23 (a) IN GENERAL.—Section 1902(a)(10)(A)(i) of the 

24 Social Security Act (42 U.S.C. 1396a), as amended by 

25 section 2001(a)(1), is amended— 


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1 (1) by striking ‘‘or’’ at the end of subclause 

2 (VII); 

3 (2) by adding ‘‘or’’ at the end of subclause 

4 (VIII); and 

5 (3) by inserting after subclause (VIII) the fol6 lowing: 

7 ‘‘(IX) who were in foster care 

8 under the responsibility of a State for 

9 more than 6 months (whether or not 

10 consecutive) but are no longer in such 

11 care, who are not described in any of 

12 subclauses (I) through (VII) of this 

13 clause, and who are under 25 years of 

14 age;’’. 

15 (b) OPTION TO PROVIDE PRESUMPTIVE ELIGI16 BILITY.—Section 1920(e) of such Act (42 U.S.C. 1396r– 

17 1(e)), as added by section 2001(a)(4)(B) and amended by 

18 section 2001(e)(2)(C), is amended by inserting ‘‘, clause 

19 (i)(IX),’’ after ‘‘clause (i)(VIII)’’. 

20 (c) CONFORMING AMENDMENTS.— 

21 (1) Section 1903(f)(4) of such Act (42 U.S.C. 

22 1396b(f)(4)), as amended by section 2001(a)(5)(D), 

23 is amended by inserting ‘‘1902(a)(10)(A)(i)(IX),’’ 

24 after ‘‘1902(a)(10)(A)(i)(VIII),’’. 


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1 (2) Section 1937(a)(2)(B)(viii) of such Act (42 

2 U.S.C. 1396u–7(a)(2)(B)(viii)) is amended by in3 serting ‘‘, or the individual qualifies for medical as4 sistance on the basis of section 

5 1902(a)(10)(A)(i)(IX)’’ before the period. 

6 (d) EFFECTIVE DATE.—The amendments made by 

7 this section take effect on January 1, 2019. 

8 SEC. 2005. PAYMENTS TO TERRITORIES. 

9 (a) INCREASE IN LIMIT ON PAYMENTS.—Section 

10 1108(g) of the Social Security Act (42 U.S.C. 1308(g)) 

11 is amended— 

12 (1) in paragraph (2), in the matter preceding 

13 subparagraph (A), by striking ‘‘paragraph (3)’’ and 

14 inserting ‘‘paragraphs (3) and (5)’’; 

15 (2) in paragraph (4), by striking ‘‘and (3)’’ and 

16 inserting ‘‘(3), and (4)’’; and 

17 (3) by adding at the end the following para18 graph: 

19 ‘‘(5) FISCAL YEAR 2011 AND THEREAFTER.— 

20 The amounts otherwise determined under this sub21 section for Puerto Rico, the Virgin Islands, Guam, 

22 the Northern Mariana Islands, and American Samoa 

23 for the second, third, and fourth quarters of fiscal 

24 year 2011, and for each fiscal year after fiscal year 

25 2011 (after the application of subsection (f) and the 


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1 preceding paragraphs of this subsection), shall be in2 creased by 30 percent.’’. 

3 (b) DISREGARD OF PAYMENTS FOR MANDATORY EX4 PANDED ENROLLMENT.—Section 1108(g)(4) of such Act 

5 (42 U.S.C. 1308(g)(4)) is amended— 

6 (1) by striking ‘‘to fiscal years beginning’’ and 

7 inserting ‘‘to— 

8 ‘‘(A) fiscal years beginning’’; 

9 (2) by striking the period at the end and insert10 ing ‘‘; and’’; and 

11 (3) by adding at the end the following: 

12 ‘‘(B) fiscal years beginning with fiscal year 

13 2014, payments made to Puerto Rico, the Vir14 gin Islands, Guam, the Northern Mariana Is15 lands, or American Samoa with respect to 

16 amounts expended for medical assistance for 

17 newly eligible (as defined in section 1905(y)(2)) 

18 nonpregnant childless adults who are eligible 

19 under subclause (VIII) of section 

20 1902(a)(10)(A)(i) and whose income (as deter21 mined under section 1902(e)(14)) does not ex22 ceed (in the case of each such commonwealth 

23 and territory respectively) the income eligibility 

24 level in effect for that population under title 

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1 ment of the Patient Protection and Affordable 

2 Care Act, shall not be taken into account in ap3 plying subsection (f) (as increased in accord4 ance with paragraphs (1), (2), (3), and (5) of 

5 this subsection) to such commonwealth or terri6 tory for such fiscal year.’’. 

7 (c) INCREASED FMAP.— 

8 (1) IN GENERAL.—The first sentence of section 

9 1905(b) of the Social Security Act (42 U.S.C. 

10 1396d(b)) is amended by striking ‘‘shall be 50 per 

11 centum’’ and inserting ‘‘shall be 55 percent’’. 

12 (2) EFFECTIVE DATE.—The amendment made 

13 by paragraph (1) takes effect on January 1, 2011. 

14 SEC. 2006. SPECIAL ADJUSTMENT TO FMAP DETERMINA15 TION FOR CERTAIN STATES RECOVERING 

16 FROM A MAJOR DISASTER. 

17 Section 1905 of the Social Security Act (42 U.S.C. 

18 1396d), as amended by sections 2001(a)(3) and 

19 2001(b)(2), is amended— 

20 (1) in subsection (b), in the first sentence, by 

21 striking ‘‘subsection (y)’’ and inserting ‘‘subsections 

22 (y) and (aa)’’; and 

23 (2) by adding at the end the following new sub24 section: 


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1 ‘‘(aa)(1) Notwithstanding subsection (b), beginning 

2 January 1, 2011, the Federal medical assistance percent3 age for a fiscal year for a disaster-recovery FMAP adjust4 ment State shall be equal to the following: 

5 ‘‘(A) In the case of the first fiscal year (or part 

6 of a fiscal year) for which this subsection applies to 

7 the State, the Federal medical assistance percentage 

8 determined for the fiscal year without regard to this 

9 subsection and subsection (y), increased by 50 per10 cent of the number of percentage points by which 

11 the Federal medical assistance percentage deter12 mined for the State for the fiscal year without re13 gard to this subsection and subsection (y), is less 

14 than the Federal medical assistance percentage de15 termined for the State for the preceding fiscal year 

16 after the application of only subsection (a) of section 

17 5001 of Public Law 111–5 (if applicable to the pre18 ceding fiscal year) and without regard to this sub19 section, subsection (y), and subsections (b) and (c) 

20 of section 5001 of Public Law 111–5. 

21 ‘‘(B) In the case of the second or any suc22 ceeding fiscal year for which this subsection applies 

23 to the State, the Federal medical assistance percent24 age determined for the preceding fiscal year under 

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1 cent of the number of percentage points by which 

2 the Federal medical assistance percentage deter3 mined for the State for the fiscal year without re4 gard to this subsection and subsection (y), is less 

5 than the Federal medical assistance percentage de6 termined for the State for the preceding fiscal year 

7 under this subsection. 

8 ‘‘(2) In this subsection, the term ‘disaster-recovery 

9 FMAP adjustment State’ means a State that is one of 

10 the 50 States or the District of Columbia, for which, at 

11 any time during the preceding 7 fiscal years, the President 

12 has declared a major disaster under section 401 of the 

13 Robert T. Stafford Disaster Relief and Emergency Assist14 ance Act and determined as a result of such disaster that 

15 every county or parish in the State warrant individual and 

16 public assistance or public assistance from the Federal 

17 Government under such Act and for which— 

18 ‘‘(A) in the case of the first fiscal year (or part 

19 of a fiscal year) for which this subsection applies to 

20 the State, the Federal medical assistance percentage 

21 determined for the State for the fiscal year without 

22 regard to this subsection and subsection (y), is less 

23 than the Federal medical assistance percentage de24 termined for the State for the preceding fiscal year 

25 after the application of only subsection (a) of section 


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1 5001 of Public Law 111–5 (if applicable to the pre2 ceding fiscal year) and without regard to this sub3 section, subsection (y), and subsections (b) and (c) 

4 of section 5001 of Public Law 111–5, by at least 3 

5 percentage points; and 

6 ‘‘(B) in the case of the second or any suc7 ceeding fiscal year for which this subsection applies 

8 to the State, the Federal medical assistance percent9 age determined for the State for the fiscal year with10 out regard to this subsection and subsection (y), is 

11 less than the Federal medical assistance percentage 

12 determined for the State for the preceding fiscal 

13 year under this subsection by at least 3 percentage 

14 points. 

15 ‘‘(3) The Federal medical assistance percentage de16 termined for a disaster-recovery FMAP adjustment State 

17 under paragraph (1) shall apply for purposes of this title 

18 (other than with respect to disproportionate share hospital 

19 payments described in section 1923 and payments under 

20 this title that are based on the enhanced FMAP described 

21 in 2105(b)) and shall not apply with respect to payments 

22 under title IV (other than under part E of title IV) or 

23 payments under title XXI.’’. 


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1 SEC. 2007. MEDICAID IMPROVEMENT FUND RESCISSION. 

2 (a) RESCISSION.—Any amounts available to the Med3 icaid Improvement Fund established under section 1941 

4 of the Social Security Act (42 U.S.C. 1396w–1) for any 

5 of fiscal years 2014 through 2018 that are available for 

6 expenditure from the Fund and that are not so obligated 

7 as of the date of the enactment of this Act are rescinded. 

8 (b) CONFORMING AMENDMENTS.—Section 

9 1941(b)(1) of the Social Security Act (42 U.S.C. 1396w– 

10 1(b)(1)) is amended— 

11 (1) in subparagraph (A), by striking 

12 ‘‘$100,000,000’’ and inserting ‘‘$0’’; and 

13 (2) in subparagraph (B), by striking 

14 ‘‘$150,000,000’’ and inserting ‘‘$0’’. 

15 Subtitle B—Enhanced Support for 

16 the Children’s Health Insurance 

17 Program 

18 SEC. 2101. ADDITIONAL FEDERAL FINANCIAL PARTICIPA19 TION FOR CHIP. 

20 (a) IN GENERAL.—Section 2105(b) of the Social Se21 curity Act (42 U.S.C. 1397ee(b)) is amended by adding 

22 at the end the following: ‘‘Notwithstanding the preceding 

23 sentence, during the period that begins on October 1, 

24 2013, and ends on September 30, 2019, the enhanced 

25 FMAP determined for a State for a fiscal year (or for 

26 any portion of a fiscal year occurring during such period) 


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1 shall be increased by 23 percentage points, but in no case 

2 shall exceed 100 percent. The increase in the enhanced 

3 FMAP under the preceding sentence shall not apply with 

4 respect to determining the payment to a State under sub5 section (a)(1) for expenditures described in subparagraph 

6 (D)(iv), paragraphs (8), (9), (11) of subsection (c), or 

7 clause (4) of the first sentence of section 1905(b).’’. 

8 (b) MAINTENANCE OF EFFORT.— 

9 (1) IN GENERAL.—Section 2105(d) of the So10 cial Security Act (42 U.S.C. 1397ee(d)) is amended 

11 by adding at the end the following: 

12 ‘‘(3) CONTINUATION OF ELIGIBILITY STAND13 ARDS FOR CHILDREN UNTIL OCTOBER 1, 2019.— 

14 ‘‘(A) IN GENERAL.—During the period 

15 that begins on the date of enactment of the Pa16 tient Protection and Affordable Care Act and 

17 ends on September 30, 2019, a State shall not 

18 have in effect eligibility standards, methodolo19 gies, or procedures under its State child health 

20 plan (including any waiver under such plan) for 

21 children (including children provided medical 

22 assistance for which payment is made under 

23 section 2105(a)(1)(A)) that are more restrictive 

24 than the eligibility standards, methodologies, or 

25 procedures, respectively, under such plan (or 


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1 waiver) as in effect on the date of enactment of 

2 that Act. The preceding sentence shall not be 

3 construed as preventing a State during such pe4 riod from— 

5 ‘‘(i) applying eligibility standards, 

6 methodologies, or procedures for children 

7 under the State child health plan or under 

8 any waiver of the plan that are less restric9 tive than the eligibility standards, meth10 odologies, or procedures, respectively, for 

11 children under the plan or waiver that are 

12 in effect on the date of enactment of such 

13 Act; or 

14 ‘‘(ii) imposing a limitation described 

15 in section 2112(b)(7) for a fiscal year in 

16 order to limit expenditures under the State 

17 child health plan to those for which Fed18 eral financial participation is available 

19 under this section for the fiscal year. 

20 ‘‘(B) ASSURANCE OF EXCHANGE COV21 ERAGE FOR TARGETED LOW-INCOME CHILDREN

22 UNABLE TO BE PROVIDED CHILD HEALTH AS23 SISTANCE AS A RESULT OF FUNDING SHORT24 FALLS.—In the event that allotments provided 

25 under section 2104 are insufficient to provide 


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1 coverage to all children who are eligible to be 

2 targeted low-income children under the State 

3 child health plan under this title, a State shall 

4 establish procedures to ensure that such chil5 dren are provided coverage through an Ex6 change established by the State under section 

7 1311 of the Patient Protection and Affordable 

8 Care Act.’’. 

9 (2) CONFORMING AMENDMENT TO TITLE XXI

10 MEDICAID MAINTENANCE OF EFFORT.—Section 

11 2105(d)(1) of the Social Security Act (42 U.S.C. 

12 1397ee(d)(1)) is amended by adding before the pe13 riod ‘‘, except as required under section 

14 1902(e)(14)’’. 

15 (c) NO ENROLLMENT BONUS PAYMENTS FOR CHIL16 DREN ENROLLED AFTER FISCAL YEAR 2013.—Section 

17 2105(a)(3)(F)(iii) of the Social Security Act (42 U.S.C. 

18 1397ee(a)(3)(F)(iii)) is amended by inserting ‘‘or any chil19 dren enrolled on or after October 1, 2013’’ before the pe20 riod. 

21 (d) INCOME ELIGIBILITY DETERMINED USING MODI22 FIED GROSS INCOME.— 

23 (1) STATE PLAN REQUIREMENT.—Section 

24 2102(b)(1)(B) of the Social Security Act (42 U.S.C. 

25 1397bb(b)(1)(B)) is amended— 


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1 (A) in clause (iii), by striking ‘‘and’’ after 

2 the semicolon; 

3 (B) in clause (iv), by striking the period 

4 and inserting ‘‘; and’’; and 

5 (C) by adding at the end the following: 

6 ‘‘(v) shall, beginning January 1, 2014, 

7 use modified gross income and household 

8 income (as defined in section 36B(d)(2) of 

9 the Internal Revenue Code of 1986) to de10 termine eligibility for child health assist11 ance under the State child health plan or 

12 under any waiver of such plan and for any 

13 other purpose applicable under the plan or 

14 waiver for which a determination of income 

15 is required, including with respect to the 

16 imposition of premiums and cost-sharing, 

17 consistent with section 1902(e)(14).’’. 

18 (2) CONFORMING AMENDMENT.—Section 

19 2107(e)(1) of the Social Security Act (42 U.S.C. 

20 1397gg(e)(1)) is amended— 

21 (A) by redesignating subparagraphs (E) 

22 through (L) as subparagraphs (F) through (M), 

23 respectively; and 

24 (B) by inserting after subparagraph (D), 

25 the following: 


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1 ‘‘(E) Section 1902(e)(14) (relating to in2 come determined using modified gross income 

3 and household income).’’. 

4 (e) APPLICATION OF STREAMLINED ENROLLMENT

5 SYSTEM.—Section 2107(e)(1) of the Social Security Act 

6 (42 U.S.C. 1397gg(e)(1)), as amended by subsection 

7 (d)(2), is amended by adding at the end the following: 

8 ‘‘(N) Section 1943(b) (relating to coordi9 nation with State Exchanges and the State 

10 Medicaid agency).’’. 

11 (f) CHIP ELIGIBILITY FOR CHILDREN INELIGIBLE

12 FOR MEDICAID AS A RESULT OF ELIMINATION OF DIS13 REGARDS.—Notwithstanding any other provision of law, 

14 a State shall treat any child who is determined to be ineli15 gible for medical assistance under the State Medicaid plan 

16 or under a waiver of the plan as a result of the elimination 

17 of the application of an income disregard based on expense 

18 or type of income, as required under section 1902(e)(14) 

19 of the Social Security Act (as added by this Act), as a 

20 targeted low-income child under section 2110(b) (unless 

21 the child is excluded under paragraph (2) of that section) 

22 and shall provide child health assistance to the child under 

23 the State child health plan (whether implemented under 

24 title XIX or XXI, or both, of the Social Security Act). 


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1 SEC. 2102. TECHNICAL CORRECTIONS. 

2 (a) CHIPRA.—Effective as if included in the enact3 ment of the Children’s Health Insurance Program Reau4 thorization Act of 2009 (Public Law 111–3) (in this sec5 tion referred to as ‘‘CHIPRA’’): 

6 (1) Section 2104(m) of the Social Security Act, 

7 as added by section 102 of CHIPRA, is amended— 

8 (A) by redesignating paragraph (7) as 

9 paragraph (8); and 

10 (B) by inserting after paragraph (6), the 

11 following: 

12 ‘‘(7) ADJUSTMENT OF FISCAL YEAR 2010 AL13 LOTMENTS TO ACCOUNT FOR CHANGES IN PRO14 JECTED SPENDING FOR CERTAIN PREVIOUSLY AP15 PROVED EXPANSION PROGRAMS.—For purposes of 

16 recalculating the fiscal year 2010 allotment, in the 

17 case of one of the 50 States or the District of Co18 lumbia that has an approved State plan amendment 

19 effective January 1, 2006, to provide child health as20 sistance through the provision of benefits under the 

21 State plan under title XIX for children from birth 

22 through age 5 whose family income does not exceed 

23 200 percent of the poverty line, the Secretary shall 

24 increase the allotment by an amount that would be 

25 equal to the Federal share of expenditures that 

26 would have been claimed at the enhanced FMAP 


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1 rate rather than the Federal medical assistance per2 centage matching rate for such population.’’. 

3 (2) Section 605 of CHIPRA is amended by 

4 striking ‘‘legal residents’’ and insert ‘‘lawfully resid5 ing in the United States’’. 

6 (3) Subclauses (I) and (II) of paragraph 

7 (3)(C)(i) of section 2105(a) of the Social Security 

8 Act (42 U.S.C. 1397ee(a)(3)(ii)), as added by sec9 tion 104 of CHIPRA, are each amended by striking 

10 ‘‘, respectively’’. 

11 (4) Section 2105(a)(3)(E)(ii) of the Social Se12 curity Act (42 U.S.C. 1397ee(a)(3)(E)(ii)), as added 

13 by section 104 of CHIPRA, is amended by striking 

14 subclause (IV). 

15 (5) Section 2105(c)(9)(B) of the Social Security 

16 Act (42 U.S.C. 1397e(c)(9)(B)), as added by section 

17 211(c)(1) of CHIPRA, is amended by striking ‘‘sec18 tion 1903(a)(3)(F)’’ and inserting ‘‘section 

19 1903(a)(3)(G)’’. 

20 (6) Section 2109(b)(2)(B) of the Social Secu21 rity Act (42 U.S.C. 1397ii(b)(2)(B)), as added by 

22 section 602 of CHIPRA, is amended by striking 

23 ‘‘the child population growth factor under section 

24 2104(m)(5)(B)’’ and inserting ‘‘a high-performing 

25 State under section 2111(b)(3)(B)’’. 


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1 (7) Section 2110(c)(9)(B)(v) of the Social Secu2 rity Act (42 U.S.C. 1397jj(c)(9)(B)(v)), as added by 

3 section 505(b) of CHIPRA, is amended by striking 

4 ‘‘school or school system’’ and inserting ‘‘local edu5 cational agency (as defined under section 9101 of 

6 the Elementary and Secondary Education Act of 

7 1965’’. 

8 (8) Section 211(a)(1)(B) of CHIPRA is amend9 ed— 

10 (A) by striking ‘‘is amended’’ and all that 

11 follows through ‘‘adding’’ and inserting ‘‘is 

12 amended by adding’’; and 

13 (B) by redesignating the new subpara14 graph to be added by such section to section 

15 1903(a)(3) of the Social Security Act as a new 

16 subparagraph (H). 

17 (b) ARRA.—Effective as if included in the enactment 

18 of section 5006(a) of division B of the American Recovery 

19 and Reinvestment Act of 2009 (Public Law 111–5), the 

20 second sentence of section 1916A(a)(1) of the Social Secu21 rity Act (42 U.S.C. 1396o–1(a)(1)) is amended by striking 

22 ‘‘or (i)’’ and inserting ‘‘, (i), or (j)’’. 


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1 Subtitle C—Medicaid and CHIP 

2 Enrollment Simplification 

3 SEC. 2201. ENROLLMENT SIMPLIFICATION AND COORDINA4 TION WITH STATE HEALTH INSURANCE EX5 CHANGES. 

6 Title XIX of the Social Security Act (42 U.S.C. 

7 1397aa et seq.) is amended by adding at the end the fol8 lowing: 

9 ‘‘SEC. 1943. ENROLLMENT SIMPLIFICATION AND COORDI10 NATION WITH STATE HEALTH INSURANCE EX11 CHANGES. 

12 ‘‘(a) CONDITION FOR PARTICIPATION IN MED13 ICAID.—As a condition of the State plan under this title 

14 and receipt of any Federal financial assistance under sec15 tion 1903(a) for calendar quarters beginning after Janu16 ary 1, 2014, a State shall ensure that the requirements 

17 of subsection (b) is met. 

18 ‘‘(b) ENROLLMENT SIMPLIFICATION AND COORDINA19 TION WITH STATE HEALTH INSURANCE EXCHANGES AND

20 CHIP.— 

21 ‘‘(1) IN GENERAL.—A State shall establish pro22 cedures for— 

23 ‘‘(A) enabling individuals, through an 

24 Internet website that meets the requirements of 

25 paragraph (4), to apply for medical assistance 


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1 under the State plan or under a waiver of the 

2 plan, to be enrolled in the State plan or waiver, 

3 to renew their enrollment in the plan or waiver, 

4 and to consent to enrollment or reenrollment in 

5 the State plan through electronic signature; 

6 ‘‘(B) enrolling, without any further deter7 mination by the State and through such 

8 website, individuals who are identified by an 

9 Exchange established by the State under sec10 tion 1311 of the Patient Protection and Afford11 able Care Act as being eligible for— 

12 ‘‘(i) medical assistance under the 

13 State plan or under a waiver of the plan; 

14 or 

15 ‘‘(ii) child health assistance under the 

16 State child health plan under title XXI; 

17 ‘‘(C) ensuring that individuals who apply 

18 for but are determined to be ineligible for med19 ical assistance under the State plan or a waiver 

20 or ineligible for child health assistance under 

21 the State child health plan under title XXI, are 

22 screened for eligibility for enrollment in quali23 fied health plans offered through such an Ex24 change and, if applicable, premium assistance 

25 for the purchase of a qualified health plan 


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1 under section 36B of the Internal Revenue 

2 Code of 1986 (and, if applicable, advance pay3 ment of such assistance under section 1412 of 

4 the Patient Protection and Affordable Care 

5 Act), and, if eligible, enrolled in such a plan 

6 without having to submit an additional or sepa7 rate application, and that such individuals re8 ceive information regarding reduced cost-shar9 ing for eligible individuals under section 1402 

10 of the Patient Protection and Affordable Care 

11 Act, and any other assistance or subsidies avail12 able for coverage obtained through the Ex13 change; 

14 ‘‘(D) ensuring that the State agency re15 sponsible for administering the State plan 

16 under this title (in this section referred to as 

17 the ‘State Medicaid agency’), the State agency 

18 responsible for administering the State child 

19 health plan under title XXI (in this section re20 ferred to as the ‘State CHIP agency’) and an 

21 Exchange established by the State under sec22 tion 1311 of the Patient Protection and Afford23 able Care Act utilize a secure electronic inter24 face sufficient to allow for a determination of 

25 an individual’s eligibility for such medical asVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00447 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 sistance, child health assistance, or premium 

2 assistance, and enrollment in the State plan 

3 under this title, title XXI, or a qualified health 

4 plan, as appropriate; 

5 ‘‘(E) coordinating, for individuals who are 

6 enrolled in the State plan or under a waiver of 

7 the plan and who are also enrolled in a quali8 fied health plan offered through such an Ex9 change, and for individuals who are enrolled in 

10 the State child health plan under title XXI and 

11 who are also enrolled in a qualified health plan, 

12 the provision of medical assistance or child 

13 health assistance to such individuals with the 

14 coverage provided under the qualified health 

15 plan in which they are enrolled, including serv16 ices described in section 1905(a)(4)(B) (relating 

17 to early and periodic screening, diagnostic, and 

18 treatment services defined in section 1905(r)) 

19 and provided in accordance with the require20 ments of section 1902(a)(43); and 

21 ‘‘(F) conducting outreach to and enrolling 

22 vulnerable and underserved populations eligible 

23 for medical assistance under this title XIX or 

24 for child health assistance under title XXI, in25 cluding children, unaccompanied homeless 


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1 youth, children and youth with special health 

2 care needs, pregnant women, racial and ethnic 

3 minorities, rural populations, victims of abuse 

4 or trauma, individuals with mental health or 

5 substance-related disorders, and individuals 

6 with HIV/AIDS. 

7 ‘‘(2) AGREEMENTS WITH STATE HEALTH IN8 SURANCE EXCHANGES.—The State Medicaid agency 

9 and the State CHIP agency may enter into an 

10 agreement with an Exchange established by the 

11 State under section 1311 of the Patient Protection 

12 and Affordable Care Act under which the State 

13 Medicaid agency or State CHIP agency may deter14 mine whether a State resident is eligible for pre15 mium assistance for the purchase of a qualified 

16 health plan under section 36B of the Internal Rev17 enue Code of 1986 (and, if applicable, advance pay18 ment of such assistance under section 1412 of the 

19 Patient Protection and Affordable Care Act), so long 

20 as the agreement meets such conditions and require21 ments as the Secretary of the Treasury may pre22 scribe to reduce administrative costs and the likeli23 hood of eligibility errors and disruptions in coverage. 

24 ‘‘(3) STREAMLINED ENROLLMENT SYSTEM.— 

25 The State Medicaid agency and State CHIP agency 


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1 shall participate in and comply with the require2 ments for the system established under section 1413 

3 of the Patient Protection and Affordable Care Act 

4 (relating to streamlined procedures for enrollment 

5 through an Exchange, Medicaid, and CHIP). 

6 ‘‘(4) ENROLLMENT WEBSITE REQUIREMENTS.— 

7 The procedures established by State under para8 graph (1) shall include establishing and having in 

9 operation, not later than January 1, 2014, an Inter10 net website that is linked to any website of an Ex11 change established by the State under section 1311 

12 of the Patient Protection and Affordable Care Act 

13 and to the State CHIP agency (if different from the 

14 State Medicaid agency) and allows an individual who 

15 is eligible for medical assistance under the State 

16 plan or under a waiver of the plan and who is eligi17 ble to receive premium credit assistance for the pur18 chase of a qualified health plan under section 36B 

19 of the Internal Revenue Code of 1986 to compare 

20 the benefits, premiums, and cost-sharing applicable 

21 to the individual under the State plan or waiver with 

22 the benefits, premiums, and cost-sharing available to 

23 the individual under a qualified health plan offered 

24 through such an Exchange, including, in the case of 

25 a child, the coverage that would be provided for the 


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1 child through the State plan or waiver with the cov2 erage that would be provided to the child through 

3 enrollment in family coverage under that plan and 

4 as supplemental coverage by the State under the 

5 State plan or waiver. 

6 ‘‘(5) CONTINUED NEED FOR ASSESSMENT FOR

7 HOME AND COMMUNITY-BASED SERVICES.—Nothing 

8 in paragraph (1) shall limit or modify the require9 ment that the State assess an individual for pur10 poses of providing home and community-based serv11 ices under the State plan or under any waiver of 

12 such plan for individuals described in subsection 

13 (a)(10)(A)(ii)(VI).’’. 

14 SEC. 2202. PERMITTING HOSPITALS TO MAKE PRESUMP15 TIVE ELIGIBILITY DETERMINATIONS FOR 

16 ALL MEDICAID ELIGIBLE POPULATIONS. 

17 (a) IN GENERAL.—Section 1902(a)(47) of the Social 

18 Security Act (42 U.S.C. 1396a(a)(47)) is amended— 

19 (1) by striking ‘‘at the option of the State, pro20 vide’’ and inserting ‘‘provide— 

21 ‘‘(A) at the option of the State,’’; 

22 (2) by inserting ‘‘and’’ after the semicolon; and 

23 (3) by adding at the end the following: 

24 ‘‘(B) that any hospital that is a partici25 pating provider under the State plan may elect 


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1 to be a qualified entity for purposes of deter2 mining, on the basis of preliminary information, 

3 whether any individual is eligible for medical as4 sistance under the State plan or under a waiver 

5 of the plan for purposes of providing the indi6 vidual with medical assistance during a pre7 sumptive eligibility period, in the same manner, 

8 and subject to the same requirements, as apply 

9 to the State options with respect to populations 

10 described in section 1920, 1920A, or 1920B 

11 (but without regard to whether the State has 

12 elected to provide for a presumptive eligibility 

13 period under any such sections), subject to such 

14 guidance as the Secretary shall establish;’’. 

15 (b) CONFORMING AMENDMENT.—Section 

16 1903(u)(1)(D)(v) of such Act (42 U.S.C. 

17 1396b(u)(1)(D)v)) is amended— 

18 (1) by striking ‘‘or for’’ and inserting ‘‘for’’; 

19 and 

20 (2) by inserting before the period at the end the 

21 following: ‘‘, or for medical assistance provided to an 

22 individual during a presumptive eligibility period re23 sulting from a determination of presumptive eligi24 bility made by a hospital that elects under section 


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1 1902(a)(47)(B) to be a qualified entity for such pur2 pose’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section take effect on January 1, 2014, and apply to 

5 services furnished on or after that date. 

6 Subtitle D—Improvements to 

7 Medicaid Services 

8 SEC. 2301. COVERAGE FOR FREESTANDING BIRTH CENTER 

9 SERVICES. 

10 (a) IN GENERAL.—Section 1905 of the Social Secu11 rity Act (42 U.S.C. 1396d), is amended— 

12 (1) in subsection (a)— 

13 (A) in paragraph (27), by striking ‘‘and’’ 

14 at the end; 

15 (B) by redesignating paragraph (28) as 

16 paragraph (29); and 

17 (C) by inserting after paragraph (27) the 

18 following new paragraph: 

19 ‘‘(28) freestanding birth center services (as de20 fined in subsection (l)(3)(A)) and other ambulatory 

21 services that are offered by a freestanding birth cen22 ter (as defined in subsection (l)(3)(B)) and that are 

23 otherwise included in the plan; and’’; and 

24 (2) in subsection (l), by adding at the end the 

25 following new paragraph: 


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1 ‘‘(3)(A) The term ‘freestanding birth center services’ 

2 means services furnished to an individual at a freestanding 

3 birth center (as defined in subparagraph (B)) at such cen4 ter. 

5 ‘‘(B) The term ‘freestanding birth center’ means a 

6 health facility— 

7 ‘‘(i) that is not a hospital; 

8 ‘‘(ii) where childbirth is planned to occur away 

9 from the pregnant woman’s residence; 

10 ‘‘(iii) that is licensed or otherwise approved by 

11 the State to provide prenatal labor and delivery or 

12 postpartum care and other ambulatory services that 

13 are included in the plan; and 

14 ‘‘(iv) that complies with such other require15 ments relating to the health and safety of individuals 

16 furnished services by the facility as the State shall 

17 establish. 

18 ‘‘(C) A State shall provide separate payments to pro19 viders administering prenatal labor and delivery or 

20 postpartum care in a freestanding birth center (as defined 

21 in subparagraph (B)), such as nurse midwives and other 

22 providers of services such as birth attendants recognized 

23 under State law, as determined appropriate by the Sec24 retary. For purposes of the preceding sentence, the term 

25 ‘birth attendant’ means an individual who is recognized 


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1 or registered by the State involved to provide health care 

2 at childbirth and who provides such care within the scope 

3 of practice under which the individual is legally authorized 

4 to perform such care under State law (or the State regu5 latory mechanism provided by State law), regardless of 

6 whether the individual is under the supervision of, or asso7 ciated with, a physician or other health care provider. 

8 Nothing in this subparagraph shall be construed as chang9 ing State law requirements applicable to a birth attend10 ant.’’. 

11 (b) CONFORMING AMENDMENT.—Section 

12 1902(a)(10)(A) of the Social Security Act (42 U.S.C. 

13 1396a(a)(10)(A)), is amended in the matter preceding 

14 clause (i) by striking ‘‘and (21)’’ and inserting ‘‘, (21), 

15 and (28)’’. 

16 (c) EFFECTIVE DATE.— 

17 (1) IN GENERAL.—Except as provided in para18 graph (2), the amendments made by this section 

19 shall take effect on the date of the enactment of this 

20 Act and shall apply to services furnished on or after 

21 such date. 

22 (2) EXCEPTION IF STATE LEGISLATION RE23 QUIRED.—In the case of a State plan for medical as24 sistance under title XIX of the Social Security Act 

25 which the Secretary of Health and Human Services 


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1 determines requires State legislation (other than leg2 islation appropriating funds) in order for the plan to 

3 meet the additional requirement imposed by the 

4 amendments made by this section, the State plan 

5 shall not be regarded as failing to comply with the 

6 requirements of such title solely on the basis of its 

7 failure to meet this additional requirement before 

8 the first day of the first calendar quarter beginning 

9 after the close of the first regular session of the 

10 State legislature that begins after the date of the en11 actment of this Act. For purposes of the previous 

12 sentence, in the case of a State that has a 2-year 

13 legislative session, each year of such session shall be 

14 deemed to be a separate regular session of the State 

15 legislature. 

16 SEC. 2302. CONCURRENT CARE FOR CHILDREN. 

17 (a) IN GENERAL.—Section 1905(o)(1) of the Social 

18 Security Act (42 U.S.C. 1396d(o)(1)) is amended— 

19 (1) in subparagraph (A), by striking ‘‘subpara20 graph (B)’’ and inserting ‘‘subparagraphs (B) and 

21 (C)’’; and 

22 (2) by adding at the end the following new sub23 paragraph: 

24 ‘‘(C) A voluntary election to have payment made for 

25 hospice care for a child (as defined by the State) shall 


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1 not constitute a waiver of any rights of the child to be 

2 provided with, or to have payment made under this title 

3 for, services that are related to the treatment of the child’s 

4 condition for which a diagnosis of terminal illness has been 

5 made.’’. 

6 (b) APPLICATION TO CHIP.—Section 2110(a)(23) of 

7 the Social Security Act (42 U.S.C. 1397jj(a)(23)) is 

8 amended by inserting ‘‘(concurrent, in the case of an indi9 vidual who is a child, with care related to the treatment 

10 of the child’s condition with respect to which a diagnosis 

11 of terminal illness has been made’’ after ‘‘hospice care’’. 

12 SEC. 2303. STATE ELIGIBILITY OPTION FOR FAMILY PLAN13 NING SERVICES. 

14 (a) COVERAGE AS OPTIONAL CATEGORICALLY

15 NEEDY GROUP.— 

16 (1) IN GENERAL.—Section 1902(a)(10)(A)(ii) 

17 of the Social Security Act (42 U.S.C. 

18 1396a(a)(10)(A)(ii)), as amended by section 

19 2001(e), is amended— 

20 (A) in subclause (XIX), by striking ‘‘or’’ at 

21 the end; 

22 (B) in subclause (XX), by adding ‘‘or’’ at 

23 the end; and 

24 (C) by adding at the end the following new 

25 subclause: 


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1 ‘‘(XXI) who are described in sub2 section (ii) (relating to individuals 

3 who meet certain income standards);’’. 

4 (2) GROUP DESCRIBED.—Section 1902 of such 

5 Act (42 U.S.C. 1396a), as amended by section 

6 2001(d), is amended by adding at the end the fol7 lowing new subsection: 

8 ‘‘(ii)(1) Individuals described in this subsection are 

9 individuals— 

10 ‘‘(A) whose income does not exceed an in11 come eligibility level established by the State 

12 that does not exceed the highest income eligi13 bility level established under the State plan 

14 under this title (or under its State child health 

15 plan under title XXI) for pregnant women; and 

16 ‘‘(B) who are not pregnant. 

17 ‘‘(2) At the option of a State, individuals de18 scribed in this subsection may include individuals 

19 who, had individuals applied on or before January 1, 

20 2007, would have been made eligible pursuant to the 

21 standards and processes imposed by that State for 

22 benefits described in clause (XV) of the matter fol23 lowing subparagraph (G) of section subsection 

24 (a)(10) pursuant to a waiver granted under section 

25 1115. 


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1 ‘‘(3) At the option of a State, for purposes of 

2 subsection (a)(17)(B), in determining eligibility for 

3 services under this subsection, the State may con4 sider only the income of the applicant or recipient.’’. 

5 (3) LIMITATION ON BENEFITS.—Section 

6 1902(a)(10) of the Social Security Act (42 U.S.C. 

7 1396a(a)(10)), as amended by section 

8 2001(a)(5)(A), is amended in the matter following 

9 subparagraph (G)— 

10 (A) by striking ‘‘and (XV)’’ and inserting 

11 ‘‘(XV)’’; and 

12 (B) by inserting ‘‘, and (XVI) the medical 

13 assistance made available to an individual de14 scribed in subsection (ii) shall be limited to 

15 family planning services and supplies described 

16 in section 1905(a)(4)(C) including medical di17 agnosis and treatment services that are pro18 vided pursuant to a family planning service in 

19 a family planning setting’’ before the semicolon. 

20 (4) CONFORMING AMENDMENTS.— 

21 (A) Section 1905(a) of the Social Security 

22 Act (42 U.S.C. 1396d(a)), as amended by sec23 tion 2001(e)(2)(A), is amended in the matter 

24 preceding paragraph (1)— 


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1 (i) in clause (xiv), by striking ‘‘or’’ at 

2 the end; 

3 (ii) in clause (xv), by adding ‘‘or’’ at 

4 the end; and 

5 (iii) by inserting after clause (xv) the 

6 following: 

7 ‘‘(xvi) individuals described in section 

8 1902(ii),’’. 

9 (B) Section 1903(f)(4) of such Act (42 

10 U.S.C. 1396b(f)(4)), as amended by section 

11 2001(e)(2)(B), is amended by inserting 

12 ‘‘1902(a)(10)(A)(ii)(XXI),’’ after 

13 ‘‘1902(a)(10)(A)(ii)(XX),’’. 

14 (b) PRESUMPTIVE ELIGIBILITY.— 

15 (1) IN GENERAL.—Title XIX of the Social Se16 curity Act (42 U.S.C. 1396 et seq.) is amended by 

17 inserting after section 1920B the following: 

18 ‘‘PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING

19 SERVICES

20 ‘‘SEC. 1920C. (a) STATE OPTION.—State plan ap21 proved under section 1902 may provide for making med22 ical assistance available to an individual described in sec23 tion 1902(ii) (relating to individuals who meet certain in24 come eligibility standard) during a presumptive eligibility 

25 period. In the case of an individual described in section 

26 1902(ii), such medical assistance shall be limited to family 


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1 planning services and supplies described in 1905(a)(4)(C) 

2 and, at the State’s option, medical diagnosis and treat3 ment services that are provided in conjunction with a fam4 ily planning service in a family planning setting. 

5 ‘‘(b) DEFINITIONS.—For purposes of this section: 

6 ‘‘(1) PRESUMPTIVE ELIGIBILITY PERIOD.—The 

7 term ‘presumptive eligibility period’ means, with re8 spect to an individual described in subsection (a), 

9 the period that— 

10 ‘‘(A) begins with the date on which a 

11 qualified entity determines, on the basis of pre12 liminary information, that the individual is de13 scribed in section 1902(ii); and 

14 ‘‘(B) ends with (and includes) the earlier 

15 of— 

16 ‘‘(i) the day on which a determination 

17 is made with respect to the eligibility of 

18 such individual for services under the State 

19 plan; or 

20 ‘‘(ii) in the case of such an individual 

21 who does not file an application by the last 

22 day of the month following the month dur23 ing which the entity makes the determina24 tion referred to in subparagraph (A), such 

25 last day. 


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1 ‘‘(2) QUALIFIED ENTITY.— 

2 ‘‘(A) IN GENERAL.—Subject to subpara3 graph (B), the term ‘qualified entity’ means 

4 any entity that— 

5 ‘‘(i) is eligible for payments under a 

6 State plan approved under this title; and 

7 ‘‘(ii) is determined by the State agen8 cy to be capable of making determinations 

9 of the type described in paragraph (1)(A). 

10 ‘‘(B) RULE OF CONSTRUCTION.—Nothing 

11 in this paragraph shall be construed as pre12 venting a State from limiting the classes of en13 tities that may become qualified entities in 

14 order to prevent fraud and abuse. 

15 ‘‘(c) ADMINISTRATION.— 

16 ‘‘(1) IN GENERAL.—The State agency shall pro17 vide qualified entities with— 

18 ‘‘(A) such forms as are necessary for an 

19 application to be made by an individual de20 scribed in subsection (a) for medical assistance 

21 under the State plan; and 

22 ‘‘(B) information on how to assist such in23 dividuals in completing and filing such forms. 

24 ‘‘(2) NOTIFICATION REQUIREMENTS.—A quali25 fied entity that determines under subsection 


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1 (b)(1)(A) that an individual described in subsection 

2 (a) is presumptively eligible for medical assistance 

3 under a State plan shall— 

4 ‘‘(A) notify the State agency of the deter5 mination within 5 working days after the date 

6 on which determination is made; and 

7 ‘‘(B) inform such individual at the time 

8 the determination is made that an application 

9 for medical assistance is required to be made by 

10 not later than the last day of the month fol11 lowing the month during which the determina12 tion is made. 

13 ‘‘(3) APPLICATION FOR MEDICAL ASSIST14 ANCE.—In the case of an individual described in 

15 subsection (a) who is determined by a qualified enti16 ty to be presumptively eligible for medical assistance 

17 under a State plan, the individual shall apply for 

18 medical assistance by not later than the last day of 

19 the month following the month during which the de20 termination is made. 

21 ‘‘(d) PAYMENT.—Notwithstanding any other provi22 sion of law, medical assistance that— 

23 ‘‘(1) is furnished to an individual described in 

24 subsection (a)— 


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1 ‘‘(A) during a presumptive eligibility pe2 riod; and 

3 ‘‘(B) by a entity that is eligible for pay4 ments under the State plan; and 

5 ‘‘(2) is included in the care and services covered 

6 by the State plan, 

7 shall be treated as medical assistance provided by such 

8 plan for purposes of clause (4) of the first sentence of 

9 section 1905(b).’’. 

10 (2) CONFORMING AMENDMENTS.— 

11 (A) Section 1902(a)(47) of the Social Se12 curity Act (42 U.S.C. 1396a(a)(47)), as amend13 ed by section 2202(a), is amended— 

14 (i) in subparagraph (A), by inserting 

15 before the semicolon at the end the fol16 lowing: ‘‘and provide for making medical 

17 assistance available to individuals described 

18 in subsection (a) of section 1920C during 

19 a presumptive eligibility period in accord20 ance with such section’’; and 

21 (ii) in subparagraph (B), by striking 

22 ‘‘or 1920B’’ and inserting ‘‘1920B, or 

23 1920C’’. 

24 (B) Section 1903(u)(1)(D)(v) of such Act 

25 (42 U.S.C. 1396b(u)(1)(D)(v)), as amended by 


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1 section 2202(b), is amended by inserting ‘‘or 

2 for medical assistance provided to an individual 

3 described in subsection (a) of section 1920C 

4 during a presumptive eligibility period under 

5 such section,’’ after ‘‘1920B during a presump6 tive eligibility period under such section,’’. 

7 (c) CLARIFICATION OF COVERAGE OF FAMILY PLAN8 NING SERVICES AND SUPPLIES.—Section 1937(b) of the 

9 Social Security Act (42 U.S.C. 1396u–7(b)), as amended 

10 by section 2001(c), is amended by adding at the end the 

11 following: 

12 ‘‘(7) COVERAGE OF FAMILY PLANNING SERV13 ICES AND SUPPLIES.—Notwithstanding the previous 

14 provisions of this section, a State may not provide 

15 for medical assistance through enrollment of an indi16 vidual with benchmark coverage or benchmark-equiv17 alent coverage under this section unless such cov18 erage includes for any individual described in section 

19 1905(a)(4)(C), medical assistance for family plan20 ning services and supplies in accordance with such 

21 section.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section take effect on the date of the enactment of 

24 this Act and shall apply to items and services furnished 

25 on or after such date. 


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1 SEC. 2304. CLARIFICATION OF DEFINITION OF MEDICAL AS2 SISTANCE. 

3 Section 1905(a) of the Social Security Act (42 U.S.C. 

4 1396d(a)) is amended by inserting ‘‘or the care and serv5 ices themselves, or both’’ before ‘‘(if provided in or after’’. 

6 Subtitle E—New Options for States 

7 to Provide Long-Term Services 

8 and Supports 

9 SEC. 2401. COMMUNITY FIRST CHOICE OPTION. 

10 Section 1915 of the Social Security Act (42 U.S.C. 

11 1396n) is amended by adding at the end the following: 

12 ‘‘(k) STATE PLAN OPTION TO PROVIDE HOME AND

13 COMMUNITY-BASED ATTENDANT SERVICES AND SUP14 PORTS.— 

15 ‘‘(1) IN GENERAL.—Subject to the succeeding 

16 provisions of this subsection, beginning October 1, 

17 2010, a State may provide through a State plan 

18 amendment for the provision of medical assistance 

19 for home and community-based attendant services 

20 and supports for individuals who are eligible for 

21 medical assistance under the State plan whose in22 come does not exceed 150 percent of the poverty line 

23 (as defined in section 2110(c)(5)) or, if greater, the 

24 income level applicable for an individual who has 

25 been determined to require an institutional level of 

26 care to be eligible for nursing facility services under 


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1 the State plan and with respect to whom there has 

2 been a determination that, but for the provision of 

3 such services, the individuals would require the level 

4 of care provided in a hospital, a nursing facility, an 

5 intermediate care facility for the mentally retarded, 

6 or an institution for mental diseases, the cost of 

7 which could be reimbursed under the State plan, but 

8 only if the individual chooses to receive such home 

9 and community-based attendant services and sup10 ports, and only if the State meets the following re11 quirements: 

12 ‘‘(A) AVAILABILITY.—The State shall 

13 make available home and community-based at14 tendant services and supports to eligible indi15 viduals, as needed, to assist in accomplishing 

16 activities of daily living, instrumental activities 

17 of daily living, and health-related tasks through 

18 hands-on assistance, supervision, or cueing— 

19 ‘‘(i) under a person-centered plan of 

20 services and supports that is based on an 

21 assessment of functional need and that is 

22 agreed to in writing by the individual or, 

23 as appropriate, the individual’s representa24 tive; 


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1 ‘‘(ii) in a home or community setting, 

2 which does not include a nursing facility, 

3 institution for mental diseases, or an inter4 mediate care facility for the mentally re5 tarded; 

6 ‘‘(iii) under an agency-provider model 

7 or other model (as defined in paragraph 

8 (6)(C )); and 

9 ‘‘(iv) the furnishing of which— 

10 ‘‘(I) is selected, managed, and 

11 dismissed by the individual, or, as ap12 propriate, with assistance from the in13 dividual’s representative; 

14 ‘‘(II) is controlled, to the max15 imum extent possible, by the indi16 vidual or where appropriate, the indi17 vidual’s representative, regardless of 

18 who may act as the employer of 

19 record; and 

20 ‘‘(III) provided by an individual 

21 who is qualified to provide such serv22 ices, including family members (as de23 fined by the Secretary). 

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1 plishing activities of daily living, instrumental 

2 activities of daily living, and health related 

3 tasks, the home and community-based attend4 ant services and supports made available in5 clude— 

6 ‘‘(i) the acquisition, maintenance, and 

7 enhancement of skills necessary for the in8 dividual to accomplish activities of daily 

9 living, instrumental activities of daily liv10 ing, and health related tasks; 

11 ‘‘(ii) back-up systems or mechanisms 

12 (such as the use of beepers or other elec13 tronic devices) to ensure continuity of serv14 ices and supports; and 

15 ‘‘(iii) voluntary training on how to se16 lect, manage, and dismiss attendants. 

17 ‘‘(C) EXCLUDED SERVICES AND SUP18 PORTS.—Subject to subparagraph (D), the 

19 home and community-based attendant services 

20 and supports made available do not include— 

21 ‘‘(i) room and board costs for the in22 dividual; 

23 ‘‘(ii) special education and related 

24 services provided under the Individuals 

25 with Disabilities Education Act and vocaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00469 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tional rehabilitation services provided 

2 under the Rehabilitation Act of 1973; 

3 ‘‘(iii) assistive technology devices and 

4 assistive technology services other than 

5 those under (1)(B)(ii); 

6 ‘‘(iv) medical supplies and equipment; 

7 or 

8 ‘‘(v) home modifications. 

9 ‘‘(D) PERMISSIBLE SERVICES AND SUP10 PORTS.—The home and community-based at11 tendant services and supports may include— 

12 ‘‘(i) expenditures for transition costs 

13 such as rent and utility deposits, first 

14 month’s rent and utilities, bedding, basic 

15 kitchen supplies, and other necessities re16 quired for an individual to make the tran17 sition from a nursing facility, institution 

18 for mental diseases, or intermediate care 

19 facility for the mentally retarded to a com20 munity-based home setting where the indi21 vidual resides; and 

22 ‘‘(ii) expenditures relating to a need 

23 identified in an individual’s person-cen24 tered plan of services that increase inde25 pendence or substitute for human assistVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00470 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ance, to the extent that expenditures would 

2 otherwise be made for the human assist3 ance. 

4 ‘‘(2) INCREASED FEDERAL FINANCIAL PARTICI5 PATION.—For purposes of payments to a State 

6 under section 1903(a)(1), with respect to amounts 

7 expended by the State to provide medical assistance 

8 under the State plan for home and community-based 

9 attendant services and supports to eligible individ10 uals in accordance with this subsection during a fis11 cal year quarter occurring during the period de12 scribed in paragraph (1), the Federal medical assist13 ance percentage applicable to the State (as deter14 mined under section 1905(b)) shall be increased by 

15 6 percentage points. 

16 ‘‘(3) STATE REQUIREMENTS.—In order for a 

17 State plan amendment to be approved under this 

18 subsection, the State shall— 

19 ‘‘(A) develop and implement such amend20 ment in collaboration with a Development and 

21 Implementation Council established by the 

22 State that includes a majority of members with 

23 disabilities, elderly individuals, and their rep24 resentatives and consults and collaborates with 

25 such individuals; 


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1 ‘‘(B) provide consumer controlled home 

2 and community-based attendant services and 

3 supports to individuals on a statewide basis, in 

4 a manner that provides such services and sup5 ports in the most integrated setting appropriate 

6 to the individual’s needs, and without regard to 

7 the individual’s age, type or nature of disability, 

8 severity of disability, or the form of home and 

9 community-based attendant services and sup10 ports that the individual requires in order to 

11 lead an independent life; 

12 ‘‘(C) with respect to expenditures during 

13 the first full fiscal year in which the State plan 

14 amendment is implemented, maintain or exceed 

15 the level of State expenditures for medical as16 sistance that is provided under section 1905(a), 

17 section 1915, section 1115, or otherwise to indi18 viduals with disabilities or elderly individuals 

19 attributable to the preceding fiscal year; 

20 ‘‘(D) establish and maintain a comprehen21 sive, continuous quality assurance system with 

22 respect to community- based attendant services 

23 and supports that— 

24 ‘‘(i) includes standards for agency25 based and other delivery models with reVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00472 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 spect to training, appeals for denials and 

2 reconsideration procedures of an individual 

3 plan, and other factors as determined by 

4 the Secretary; 

5 ‘‘(ii) incorporates feedback from con6 sumers and their representatives, disability 

7 organizations, providers, families of dis8 abled or elderly individuals, members of 

9 the community, and others and maximizes 

10 consumer independence and consumer con11 trol; 

12 ‘‘(iii) monitors the health and well13 being of each individual who receives home 

14 and community-based attendant services 

15 and supports, including a process for the 

16 mandatory reporting, investigation, and 

17 resolution of allegations of neglect, abuse, 

18 or exploitation in connection with the pro19 vision of such services and supports; and 

20 ‘‘(iv) provides information about the 

21 provisions of the quality assurance re22 quired under clauses (i) through (iii) to 

23 each individual receiving such services; and 

24 ‘‘(E) collect and report information, as de25 termined necessary by the Secretary, for the 


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1 purposes of approving the State plan amend2 ment, providing Federal oversight, and con3 ducting an evaluation under paragraph (5)(A), 

4 including data regarding how the State provides 

5 home and community-based attendant services 

6 and supports and other home and community7 based services, the cost of such services and 

8 supports, and how the State provides individ9 uals with disabilities who otherwise qualify for 

10 institutional care under the State plan or under 

11 a waiver the choice to instead receive home and 

12 community-based services in lieu of institutional 

13 care. 

14 ‘‘(4) COMPLIANCE WITH CERTAIN LAWS.—A 

15 State shall ensure that, regardless of whether the 

16 State uses an agency-provider model or other models 

17 to provide home and community-based attendant 

18 services and supports under a State plan amend19 ment under this subsection, such services and sup20 ports are provided in accordance with the require21 ments of the Fair Labor Standards Act of 1938 and 

22 applicable Federal and State laws regarding— 

23 ‘‘(A) withholding and payment of Federal 

24 and State income and payroll taxes; 


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1 ‘‘(B) the provision of unemployment and 

2 workers compensation insurance; 

3 ‘‘(C) maintenance of general liability insur4 ance; and 

5 ‘‘(D) occupational health and safety. 

6 ‘‘(5) EVALUATION, DATA COLLECTION, AND RE7 PORT TO CONGRESS.— 

8 ‘‘(A) EVALUATION.—The Secretary shall 

9 conduct an evaluation of the provision of home 

10 and community-based attendant services and 

11 supports under this subsection in order to de12 termine the effectiveness of the provision of 

13 such services and supports in allowing the indi14 viduals receiving such services and supports to 

15 lead an independent life to the maximum extent 

16 possible; the impact on the physical and emo17 tional health of the individuals who receive such 

18 services; and an comparative analysis of the 

19 costs of services provided under the State plan 

20 amendment under this subsection and those 

21 provided under institutional care in a nursing 

22 facility, institution for mental diseases, or an 

23 intermediate care facility for the mentally re24 tarded. 


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1 ‘‘(B) DATA COLLECTION.—The State shall 

2 provide the Secretary with the following infor3 mation regarding the provision of home and 

4 community-based attendant services and sup5 ports under this subsection for each fiscal year 

6 for which such services and supports are pro7 vided: 

8 ‘‘(i) The number of individuals who 

9 are estimated to receive home and commu10 nity-based attendant services and supports 

11 under this subsection during the fiscal 

12 year. 

13 ‘‘(ii) The number of individuals that 

14 received such services and supports during 

15 the preceding fiscal year. 

16 ‘‘(iii) The specific number of individ17 uals served by type of disability, age, gen18 der, education level, and employment sta19 tus. 

20 ‘‘(iv) Whether the specific individuals 

21 have been previously served under any 

22 other home and community based services 

23 program under the State plan or under a 

24 waiver. 

25 ‘‘(C) REPORTS.—Not later than— 


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1 ‘‘(i) December 31, 2013, the Sec2 retary shall submit to Congress and make 

3 available to the public an interim report on 

4 the findings of the evaluation under sub5 paragraph (A); and 

6 ‘‘(ii) December 31, 2015, the Sec7 retary shall submit to Congress and make 

8 available to the public a final report on the 

9 findings of the evaluation under subpara10 graph (A). 

11 ‘‘(6) DEFINITIONS.—In this subsection: 

12 ‘‘(A) ACTIVITIES OF DAILY LIVING.—The 

13 term ‘activities of daily living’ includes tasks 

14 such as eating, toileting, grooming, dressing, 

15 bathing, and transferring. 

16 ‘‘(B) CONSUMER CONTROLLED.—The term 

17 ‘consumer controlled’ means a method of select18 ing and providing services and supports that 

19 allow the individual, or where appropriate, the 

20 individual’s representative, maximum control of 

21 the home and community-based attendant serv22 ices and supports, regardless of who acts as the 

23 employer of record. 

24 ‘‘(C) DELIVERY MODELS.— 


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1 ‘‘(i) AGENCY-PROVIDER MODEL.—The 

2 term ‘agency-provider model’ means, with 

3 respect to the provision of home and com4 munity-based attendant services and sup5 ports for an individual, subject to para6 graph (4), a method of providing consumer 

7 controlled services and supports under 

8 which entities contract for the provision of 

9 such services and supports. 

10 ‘‘(ii) OTHER MODELS.—The term 

11 ‘other models’ means, subject to paragraph 

12 (4), methods, other than an agency-pro13 vider model, for the provision of consumer 

14 controlled services and supports. Such 

15 models may include the provision of vouch16 ers, direct cash payments, or use of a fiscal 

17 agent to assist in obtaining services. 

18 ‘‘(D) HEALTH-RELATED TASKS.—The 

19 term ‘health-related tasks’ means specific tasks 

20 related to the needs of an individual, which can 

21 be delegated or assigned by licensed health-care 

22 professionals under State law to be performed 

23 by an attendant. 

24 ‘‘(E) INDIVIDUAL’S REPRESENTATIVE.— 

25 The term ‘individual’s representative’ means a 


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1 parent, family member, guardian, advocate, or 

2 other authorized representative of an individual 

3 ‘‘(F) INSTRUMENTAL ACTIVITIES OF DAILY

4 LIVING.—The term ‘instrumental activities of 

5 daily living’ includes (but is not limited to) meal 

6 planning and preparation, managing finances, 

7 shopping for food, clothing, and other essential 

8 items, performing essential household chores, 

9 communicating by phone or other media, and 

10 traveling around and participating in the com11 munity.’’. 

12 SEC. 2402. REMOVAL OF BARRIERS TO PROVIDING HOME 

13 AND COMMUNITY-BASED SERVICES. 

14 (a) OVERSIGHT AND ASSESSMENT OF THE ADMINIS15 TRATION OF HOME AND COMMUNITY-BASED SERVICES.— 

16 The Secretary of Health and Human Services shall pro17 mulgate regulations to ensure that all States develop serv18 ice systems that are designed to— 

19 (1) allocate resources for services in a manner 

20 that is responsive to the changing needs and choices 

21 of beneficiaries receiving non-institutionally-based 

22 long-term services and supports (including such 

23 services and supports that are provided under pro24 grams other the State Medicaid program), and that 

25 provides strategies for beneficiaries receiving such 


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1 services to maximize their independence, including 

2 through the use of client-employed providers; 

3 (2) provide the support and coordination needed 

4 for a beneficiary in need of such services (and their 

5 family caregivers or representative, if applicable) to 

6 design an individualized, self-directed, community7 supported life; and 

8 (3) improve coordination among, and the regu9 lation of, all providers of such services under feder10 ally and State-funded programs in order to— 

11 (A) achieve a more consistent administra12 tion of policies and procedures across programs 

13 in relation to the provision of such services; and 

14 (B) oversee and monitor all service system 

15 functions to assure— 

16 (i) coordination of, and effectiveness 

17 of, eligibility determinations and individual 

18 assessments; 

19 (ii) development and service moni20 toring of a complaint system, a manage21 ment system, a system to qualify and mon22 itor providers, and systems for role-setting 

23 and individual budget determinations; and 


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1 (iii) an adequate number of qualified 

2 direct care workers to provide self-directed 

3 personal assistance services. 

4 (b) ADDITIONAL STATE OPTIONS.—Section 1915(i) 

5 of the Social Security Act (42 U.S.C. 1396n(i)) is amend6 ed by adding at the end the following new paragraphs: 

7 ‘‘(6) STATE OPTION TO PROVIDE HOME AND

8 COMMUNITY-BASED SERVICES TO INDIVIDUALS ELI9 GIBLE FOR SERVICES UNDER A WAIVER.— 

10 ‘‘(A) IN GENERAL.—A State that provides 

11 home and community-based services in accord12 ance with this subsection to individuals who 

13 satisfy the needs-based criteria for the receipt 

14 of such services established under paragraph 

15 (1)(A) may, in addition to continuing to provide 

16 such services to such individuals, elect to pro17 vide home and community-based services in ac18 cordance with the requirements of this para19 graph to individuals who are eligible for home 

20 and community-based services under a waiver 

21 approved for the State under subsection (c), 

22 (d), or (e) or under section 1115 to provide 

23 such services, but only for those individuals 

24 whose income does not exceed 300 percent of 


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1 the supplemental security income benefit rate 

2 established by section 1611(b)(1). 

3 ‘‘(B) APPLICATION OF SAME REQUIRE4 MENTS FOR INDIVIDUALS SATISFYING NEEDS5 BASED CRITERIA.—Subject to subparagraph 

6 (C), a State shall provide home and community7 based services to individuals under this para8 graph in the same manner and subject to the 

9 same requirements as apply under the other 

10 paragraphs of this subsection to the provision 

11 of home and community-based services to indi12 viduals who satisfy the needs-based criteria es13 tablished under paragraph (1)(A). 

14 ‘‘(C) AUTHORITY TO OFFER DIFFERENT

15 TYPE, AMOUNT, DURATION, OR SCOPE OF HOME

16 AND COMMUNITY-BASED SERVICES.—A State 

17 may offer home and community-based services 

18 to individuals under this paragraph that differ 

19 in type, amount, duration, or scope from the 

20 home and community-based services offered for 

21 individuals who satisfy the needs-based criteria 

22 established under paragraph (1)(A), so long as 

23 such services are within the scope of services 

24 described in paragraph (4)(B) of subsection (c) 

25 for which the Secretary has the authority to apVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00482 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 prove a waiver and do not include room or 

2 board. 

3 ‘‘(7) STATE OPTION TO OFFER HOME AND COM4 MUNITY-BASED SERVICES TO SPECIFIC, TARGETED

5 POPULATIONS.— 

6 ‘‘(A) IN GENERAL.—A State may elect in 

7 a State plan amendment under this subsection 

8 to target the provision of home and community9 based services under this subsection to specific 

10 populations and to differ the type, amount, du11 ration, or scope of such services to such specific 

12 populations. 

13 ‘‘(B) 5-YEAR TERM.— 

14 ‘‘(i) IN GENERAL.—An election by a 

15 State under this paragraph shall be for a 

16 period of 5 years. 

17 ‘‘(ii) PHASE-IN OF SERVICES AND ELI18 GIBILITY PERMITTED DURING INITIAL 5- 

19 YEAR PERIOD.—A State making an elec20 tion under this paragraph may, during the 

21 first 5-year period for which the election is 

22 made, phase-in the enrollment of eligible 

23 individuals, or the provision of services to 

24 such individuals, or both, so long as all eli25 gible individuals in the State for such servVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00483 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ices are enrolled, and all such services are 

2 provided, before the end of the initial 5- 

3 year period. 

4 ‘‘(C) RENEWAL.—An election by a State 

5 under this paragraph may be renewed for addi6 tional 5-year terms if the Secretary determines, 

7 prior to beginning of each such renewal period, 

8 that the State has— 

9 ‘‘(i) adhered to the requirements of 

10 this subsection and paragraph in providing 

11 services under such an election; and 

12 ‘‘(ii) met the State’s objectives with 

13 respect to quality improvement and bene14 ficiary outcomes.’’. 

15 (c) REMOVAL OF LIMITATION ON SCOPE OF SERV16 ICES.—Paragraph (1) of section 1915(i) of the Social Se17 curity Act (42 U.S.C. 1396n(i)), as amended by sub18 section (a), is amended by striking ‘‘or such other services 

19 requested by the State as the Secretary may approve’’. 

20 (d) OPTIONAL ELIGIBILITY CATEGORY TO PROVIDE

21 FULL MEDICAID BENEFITS TO INDIVIDUALS RECEIVING

22 HOME AND COMMUNITY-BASED SERVICES UNDER A

23 STATE PLAN AMENDMENT.— 

24 (1) IN GENERAL.—Section 1902(a)(10)(A)(ii) 

25 of the Social Security Act (42 U.S.C. 


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1 1396a(a)(10)(A)(ii)), as amended by section 

2 2304(a)(1), is amended— 

3 (A) in subclause (XX), by striking ‘‘or’’ at 

4 the end; 

5 (B) in subclause (XXI), by adding ‘‘or’’ at 

6 the end; and 

7 (C) by inserting after subclause (XXI), the 

8 following new subclause: 

9 ‘‘(XXII) who are eligible for 

10 home and community-based services 

11 under needs-based criteria established 

12 under paragraph (1)(A) of section 

13 1915(i), or who are eligible for home 

14 and community-based services under 

15 paragraph (6) of such section, and 

16 who will receive home and community17 based services pursuant to a State 

18 plan amendment under such sub19 section;’’. 

20 (2) CONFORMING AMENDMENTS.— 

21 (A) Section 1903(f)(4) of the Social Secu22 rity Act (42 U.S.C. 1396b(f)(4)), as amended 

23 by section 2304(a)(4)(B), is amended in the 

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1 ing ‘‘1902(a)(10)(A)(ii)(XXII),’’ after 

2 ‘‘1902(a)(10)(A)(ii)(XXI),’’. 

3 (B) Section 1905(a) of the Social Security 

4 Act (42 U.S.C. 1396d(a)), as so amended, is 

5 amended in the matter preceding paragraph 

6 (1)— 

7 (i) in clause (xv), by striking ‘‘or’’ at 

8 the end; 

9 (ii) in clause (xvi), by adding ‘‘or’’ at 

10 the end; and 

11 (iii) by inserting after clause (xvi) the 

12 following new clause: 

13 ‘‘(xvii) individuals who are eligible for home and 

14 community-based services under needs-based criteria 

15 established under paragraph (1)(A) of section 

16 1915(i), or who are eligible for home and commu17 nity-based services under paragraph (6) of such sec18 tion, and who will receive home and community19 based services pursuant to a State plan amendment 

20 under such subsection,’’. 

21 (e) ELIMINATION OF OPTION TO LIMIT NUMBER OF

22 ELIGIBLE INDIVIDUALS OR LENGTH OF PERIOD FOR

23 GRANDFATHERED INDIVIDUALS IF ELIGIBILITY CRITERIA

24 IS MODIFIED.—Paragraph (1) of section 1915(i) of such 

25 Act (42 U.S.C. 1396n(i)) is amended— 


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1 (1) by striking subparagraph (C) and inserting 

2 the following: 

3 ‘‘(C) PROJECTION OF NUMBER OF INDI4 VIDUALS TO BE PROVIDED HOME AND COMMU5 NITY-BASED SERVICES.—The State submits to 

6 the Secretary, in such form and manner, and 

7 upon such frequency as the Secretary shall 

8 specify, the projected number of individuals to 

9 be provided home and community-based serv10 ices.’’; and 

11 (2) in subclause (II) of subparagraph (D)(ii), 

12 by striking ‘‘to be eligible for such services for a pe13 riod of at least 12 months beginning on the date the 

14 individual first received medical assistance for such 

15 services’’ and inserting ‘‘to continue to be eligible for 

16 such services after the effective date of the modifica17 tion and until such time as the individual no longer 

18 meets the standard for receipt of such services under 

19 such pre-modified criteria’’. 

20 (f) ELIMINATION OF OPTION TO WAIVE

21 STATEWIDENESS; ADDITION OF OPTION TO WAIVE COM22 PARABILITY.—Paragraph (3) of section 1915(i) of such 

23 Act (42 U.S.C. 1396n(3)) is amended by striking 

24 ‘‘1902(a)(1) (relating to statewideness)’’ and inserting 

25 ‘‘1902(a)(10)(B) (relating to comparability)’’. 


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1 (g) EFFECTIVE DATE.—The amendments made by 

2 subsections (b) through (f) take effect on the first day of 

3 the first fiscal year quarter that begins after the date of 

4 enactment of this Act. 

5 SEC. 2403. MONEY FOLLOWS THE PERSON REBALANCING 

6 DEMONSTRATION. 

7 (a) EXTENSION OF DEMONSTRATION.— 

8 (1) IN GENERAL.—Section 6071(h) of the Def9 icit Reduction Act of 2005 (42 U.S.C. 1396a note) 

10 is amended— 

11 (A) in paragraph (1)(E), by striking ‘‘fis12 cal year 2011’’ and inserting ‘‘each of fiscal 

13 years 2011 through 2016’’; and 

14 (B) in paragraph (2), by striking ‘‘2011’’ 

15 and inserting ‘‘2016’’. 

16 (2) EVALUATION.—Paragraphs (2) and (3) of 

17 section 6071(g) of such Act is amended are each 

18 amended by striking ‘‘2011’’ and inserting ‘‘2016’’. 

19 (b) REDUCTION OF INSTITUTIONAL RESIDENCY PE20 RIOD.— 

21 (1) IN GENERAL.—Section 6071(b)(2) of the 

22 Deficit Reduction Act of 2005 (42 U.S.C. 1396a 

23 note) is amended— 

24 (A) in subparagraph (A)(i), by striking ‘‘, 

25 for a period of not less than 6 months or for 


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1 such longer minimum period, not to exceed 2 

2 years, as may be specified by the State’’ and in3 serting ‘‘for a period of not less than 90 con4 secutive days’’; and 

5 (B) by adding at the end the following: 

6 ‘‘Any days that an individual resides in an institu7 tion on the basis of having been admitted solely for 

8 purposes of receiving short-term rehabilitative serv9 ices for a period for which payment for such services 

10 is limited under title XVIII shall not be taken into 

11 account for purposes of determining the 90-day pe12 riod required under subparagraph (A)(i).’’. 

13 (2) EFFECTIVE DATE.—The amendments made 

14 by this subsection take effect 30 days after the date 

15 of enactment of this Act. 

16 SEC. 2404. PROTECTION FOR RECIPIENTS OF HOME AND 

17 COMMUNITY-BASED SERVICES AGAINST 

18 SPOUSAL IMPOVERISHMENT. 

19 During the 5-year period that begins on January 1, 

20 2014, section 1924(h)(1)(A) of the Social Security Act (42 

21 U.S.C. 1396r–5(h)(1)(A)) shall be applied as though ‘‘is 

22 eligible for medical assistance for home and community23 based services provided under subsection (c), (d), or (i) 

24 of section 1915, under a waiver approved under section 

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1 son of being determined eligible under section 

2 1902(a)(10)(C) or by reason of section 1902(f) or other3 wise on the basis of a reduction of income based on costs 

4 incurred for medical or other remedial care, or who is eligi5 ble for medical assistance for home and community-based 

6 attendant services and supports under section 1915(k)’’ 

7 were substituted in such section for ‘‘(at the option of the 

8 State) is described in section 1902(a)(10)(A)(ii)(VI)’’. 

9 SEC. 2405. FUNDING TO EXPAND STATE AGING AND DIS10 ABILITY RESOURCE CENTERS. 

11 Out of any funds in the Treasury not otherwise ap12 propriated, there is appropriated to the Secretary of 

13 Health and Human Services, acting through the Assistant 

14 Secretary for Aging, $10,000,000 for each of fiscal years 

15 2010 through 2014, to carry out subsections 

16 (a)(20)(B)(iii) and (b)(8) of section 202 of the Older 

17 Americans Act of 1965 (42 U.S.C. 3012). 

18 SEC. 2406. SENSE OF THE SENATE REGARDING LONG-TERM 

19 CARE. 

20 (a) FINDINGS.—The Senate makes the following 

21 findings: 

22 (1) Nearly 2 decades have passed since Con23 gress seriously considered long-term care reform. 

24 The United States Bipartisan Commission on Com25 prehensive Health Care, also know as the ‘‘Pepper 


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1 Commission’’, released its ‘‘Call for Action’’ blue2 print for health reform in September 1990. In the 

3 20 years since those recommendations were made, 

4 Congress has never acted on the report. 

5 (2) In 1999, under the United States Supreme 

6 Court’s decision in Olmstead v. L.C., 527 U.S. 581 

7 (1999), individuals with disabilities have the right to 

8 choose to receive their long-term services and sup9 ports in the community, rather than in an institu10 tional setting. 

11 (3) Despite the Pepper Commission and 

12 Olmstead decision, the long-term care provided to 

13 our Nation‘s elderly and disabled has not improved. 

14 In fact, for many, it has gotten far worse. 

15 (4) In 2007, 69 percent of Medicaid long-term 

16 care spending for elderly individuals and adults with 

17 physical disabilities paid for institutional services. 

18 Only 6 states spent 50 percent or more of their 

19 Medicaid long-term care dollars on home and com20 munity-based services for elderly individuals and 

adults with physical disabilities while 1 21 ⁄2 of the 

22 States spent less than 25 percent. This disparity 

23 continues even though, on average, it is estimated 

24 that Medicaid dollars can support nearly 3 elderly 

25 individuals and adults with physical disabilities in 


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1 home and community-based services for every indi2 vidual in a nursing home. Although every State has 

3 chosen to provide certain services under home and 

4 community-based waivers, these services are un5 evenly available within and across States, and reach 

6 a small percentage of eligible individuals. 

7 (b) SENSE OF THE SENATE.—It is the sense of the 

8 Senate that— 

9 (1) during the 111th session of Congress, Con10 gress should address long-term services and supports 

11 in a comprehensive way that guarantees elderly and 

12 disabled individuals the care they need; and 

13 (2) long term services and supports should be 

14 made available in the community in addition to in 

15 institutions. 

16 Subtitle F—Medicaid Prescription 

17 Drug Coverage 

18 SEC. 2501. PRESCRIPTION DRUG REBATES. 

19 (a) INCREASE IN MINIMUM REBATE PERCENTAGE

20 FOR SINGLE SOURCE DRUGS AND INNOVATOR MULTIPLE

21 SOURCE DRUGS.— 

22 (1) IN GENERAL.—Section 1927(c)(1)(B) of the 

23 Social Security Act (42 U.S.C. 1396r–8(c)(1)(B)) is 

24 amended— 

25 (A) in clause (i)— 


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1 (i) in subclause (IV), by striking 

2 ‘‘and’’ at the end; 

3 (ii) in subclause (V)— 

4 (I) by inserting ‘‘and before Jan5 uary 1, 2010’’ after ‘‘December 31, 

6 1995,’’; and 

7 (II) by striking the period at the 

8 end and inserting ‘‘; and’’; and 

9 (iii) by adding at the end the fol10 lowing new subclause: 

11 ‘‘(VI) except as provided in 

12 clause (iii), after December 31, 2009, 

13 23.1 percent.’’; and 

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

15 clause: 

16 ‘‘(iii) MINIMUM REBATE PERCENTAGE

17 FOR CERTAIN DRUGS.— 

18 ‘‘(I) IN GENERAL.—In the case 

19 of a single source drug or an inno20 vator multiple source drug described 

21 in subclause (II), the minimum rebate 

22 percentage for rebate periods specified 

23 in clause (i)(VI) is 17.1 percent. 

24 ‘‘(II) DRUG DESCRIBED.—For 

25 purposes of subclause (I), a single 


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1 source drug or an innovator multiple 

2 source drug described in this sub3 clause is any of the following drugs: 

4 ‘‘(aa) A clotting factor for 

5 which a separate furnishing pay6 ment is made under section 

7 1842(o)(5) and which is included 

8 on a list of such factors specified 

9 and updated regularly by the 

10 Secretary. 

11 ‘‘(bb) A drug approved by 

12 the Food and Drug Administra13 tion exclusively for pediatric indi14 cations.’’. 

15 (2) RECAPTURE OF TOTAL SAVINGS DUE TO IN16 CREASE.—Section 1927(b)(1) of such Act (42 

17 U.S.C. 1396r–8(b)(1)) is amended by adding at the 

18 end the following new subparagraph: 

19 ‘‘(C) SPECIAL RULE FOR INCREASED MIN20 IMUM REBATE PERCENTAGE.— 

21 ‘‘(i) IN GENERAL.—In addition to the 

22 amounts applied as a reduction under sub23 paragraph (B), for rebate periods begin24 ning on or after January 1, 2010, during 

25 a fiscal year, the Secretary shall reduce 


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1 payments to a State under section 1903(a) 

2 in the manner specified in clause (ii), in an 

3 amount equal to the product of— 

4 ‘‘(I) 100 percent minus the Fed5 eral medical assistance percentage ap6 plicable to the rebate period for the 

7 State; and 

8 ‘‘(II) the amounts received by the 

9 State under such subparagraph that 

10 are attributable (as estimated by the 

11 Secretary based on utilization and 

12 other data) to the increase in the min13 imum rebate percentage effected by 

14 the amendments made by subsections 

15 (a)(1), (b), and (d) of section 2501 of 

16 the Patient Protection and Affordable 

17 Care Act, taking into account the ad18 ditional drugs included under the 

19 amendments made by subsection (c) 

20 of section 2501 of such Act. 

21 The Secretary shall adjust such payment 

22 reduction for a calendar quarter to the ex23 tent the Secretary determines, based upon 

24 subsequent utilization and other data, that 

25 the reduction for such quarter was greater 


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1 or less than the amount of payment reduc2 tion that should have been made. 

3 ‘‘(ii) MANNER OF PAYMENT REDUC4 TION.—The amount of the payment reduc5 tion under clause (i) for a State for a 

6 quarter shall be deemed an overpayment to 

7 the State under this title to be disallowed 

8 against the State’s regular quarterly draw 

9 for all Medicaid spending under section 

10 1903(d)(2). Such a disallowance is not 

11 subject to a reconsideration under section 

12 1116(d).’’. 

13 (b) INCREASE IN REBATE FOR OTHER DRUGS.—Sec14 tion 1927(c)(3)(B) of such Act (42 U.S.C. 1396r– 

15 8(c)(3)(B)) is amended— 

16 (1) in clause (i), by striking ‘‘and’’ at the end; 

17 (2) in clause (ii)— 

18 (A) by inserting ‘‘and before January 1, 

19 2010,’’ after ‘‘December 31, 1993,’’; and 

20 (B) by striking the period and inserting ‘‘; 

21 and’’; and 

22 (3) by adding at the end the following new 

23 clause: 

24 ‘‘(iii) after December 31, 2009, is 13 

25 percent.’’. 


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1 (c) EXTENSION OF PRESCRIPTION DRUG DISCOUNTS

2 TO ENROLLEES OF MEDICAID MANAGED CARE ORGANI3 ZATIONS.— 

4 (1) IN GENERAL.—Section 1903(m)(2)(A) of 

5 such Act (42 U.S.C. 1396b(m)(2)(A)) is amended— 

6 (A) in clause (xi), by striking ‘‘and’’ at the 

7 end; 

8 (B) in clause (xii), by striking the period 

9 at the end and inserting ‘‘; and’’; and 

10 (C) by adding at the end the following: 

11 ‘‘(xiii) such contract provides that (I) 

12 covered outpatient drugs dispensed to indi13 viduals eligible for medical assistance who 

14 are enrolled with the entity shall be subject 

15 to the same rebate required by the agree16 ment entered into under section 1927 as 

17 the State is subject to and that the State 

18 shall collect such rebates from manufactur19 ers, (II) capitation rates paid to the entity 

20 shall be based on actual cost experience re21 lated to rebates and subject to the Federal 

22 regulations requiring actuarially sound 

23 rates, and (III) the entity shall report to 

24 the State, on such timely and periodic 

25 basis as specified by the Secretary in order 


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1 to include in the information submitted by 

2 the State to a manufacturer and the Sec3 retary under section 1927(b)(2)(A), infor4 mation on the total number of units of 

5 each dosage form and strength and pack6 age size by National Drug Code of each 

7 covered outpatient drug dispensed to indi8 viduals eligible for medical assistance who 

9 are enrolled with the entity and for which 

10 the entity is responsible for coverage of 

11 such drug under this subsection (other 

12 than covered outpatient drugs that under 

13 subsection (j)(1) of section 1927 are not 

14 subject to the requirements of that section) 

15 and such other data as the Secretary de16 termines necessary to carry out this sub17 section.’’. 

18 (2) CONFORMING AMENDMENTS.—Section 1927 

19 (42 U.S.C. 1396r–8) is amended— 

20 (A) in subsection (b)— 

21 (i) in paragraph (1)(A), in the first 

22 sentence, by inserting ‘‘, including such 

23 drugs dispensed to individuals enrolled 

24 with a medicaid managed care organization 

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1 erage of such drugs’’ before the period; 

2 and 

3 (ii) in paragraph (2)(A), by inserting 

4 ‘‘including such information reported by 

5 each medicaid managed care organization,’’ 

6 after ‘‘for which payment was made under 

7 the plan during the period,’’; and 

8 (B) in subsection (j), by striking para9 graph (1) and inserting the following: 

10 ‘‘(1) Covered outpatient drugs are not subject 

11 to the requirements of this section if such drugs 

12 are— 

13 ‘‘(A) dispensed by health maintenance or14 ganizations, including Medicaid managed care 

15 organizations that contract under section 

16 1903(m); and 

17 ‘‘(B) subject to discounts under section 

18 340B of the Public Health Service Act.’’. 

19 (d) ADDITIONAL REBATE FOR NEW FORMULATIONS

20 OF EXISTING DRUGS.— 

21 (1) IN GENERAL.—Section 1927(c)(2) of the 

22 Social Security Act (42 U.S.C. 1396r–8(c)(2)) is 

23 amended by adding at the end the following new 

24 subparagraph: 


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1 ‘‘(C) TREATMENT OF NEW FORMULA2 TIONS.— 

3 ‘‘(i) IN GENERAL.—Except as pro4 vided in clause (ii), in the case of a drug 

5 that is a new formulation, such as an ex6 tended-release formulation, of a single 

7 source drug or an innovator multiple 

8 source drug, the rebate obligation with re9 spect to the drug under this section shall 

10 be the amount computed under this section 

11 for the new formulation of the drug or, if 

12 greater, the product of— 

13 ‘‘(I) the average manufacturer 

14 price for each dosage form and 

15 strength of the new formulation of the 

16 single source drug or innovator mul17 tiple source drug; 

18 ‘‘(II) the highest additional re19 bate (calculated as a percentage of av20 erage manufacturer price) under this 

21 section for any strength of the origi22 nal single source drug or innovator 

23 multiple source drug; and 

24 ‘‘(III) the total number of units 

25 of each dosage form and strength of 


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1 the new formulation paid for under 

2 the State plan in the rebate period (as 

3 reported by the State). 

4 ‘‘(ii) NO APPLICATION TO NEW FOR5 MULATIONS OF ORPHAN DRUGS.—Clause 

6 (i) shall not apply to a new formulation of 

7 a covered outpatient drug that is or has 

8 been designated under section 526 of the 

9 Federal Food, Drug, and Cosmetic Act (21 

10 U.S.C. 360bb) for a rare disease or condi11 tion, without regard to whether the period 

12 of market exclusivity for the drug under 

13 section 527 of such Act has expired or the 

14 specific indication for use of the drug.’’. 

15 (2) EFFECTIVE DATE.—The amendment made 

16 by paragraph (1) shall apply to drugs that are paid 

17 for by a State after December 31, 2009. 

18 (e) MAXIMUM REBATE AMOUNT.—Section 

19 1927(c)(2) of such Act (42 U.S.C. 1396r–8(c)(2)), as 

20 amended by subsection (d), is amended by adding at the 

21 end the following new subparagraph: 

22 ‘‘(D) MAXIMUM REBATE AMOUNT.—In no 

23 case shall the sum of the amounts applied 

24 under paragraph (1)(A)(ii) and this paragraph 

25 with respect to each dosage form and strength 


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1 of a single source drug or an innovator multiple 

2 source drug for a rebate period beginning after 

3 December 31, 2009, exceed 100 percent of the 

4 average manufacturer price of the drug.’’. 

5 (f) CONFORMING AMENDMENTS.— 

6 (1) IN GENERAL.—Section 340B of the Public 

7 Health Service Act (42 U.S.C. 256b) is amended— 

8 (A) in subsection (a)(2)(B)(i), by striking 

9 ‘‘1927(c)(4)’’ and inserting ‘‘1927(c)(3)’’; and 

10 (B) by striking subsection (c); and 

11 (C) redesignating subsection (d) as sub12 section (c). 

13 (2) EFFECTIVE DATE.—The amendments made 

14 by this subsection take effect on January 1, 2010. 

15 SEC. 2502. ELIMINATION OF EXCLUSION OF COVERAGE OF 

16 CERTAIN DRUGS. 

17 (a) IN GENERAL.—Section 1927(d) of the Social Se18 curity Act (42 U.S.C. 1397r–8(d)) is amended— 

19 (1) in paragraph (2)— 

20 (A) by striking subparagraphs (E), (I), 

21 and (J), respectively; and 

22 (B) by redesignating subparagraphs (F), 

23 (G), (H), and (K) as subparagraphs (E), (F), 

24 (G), and (H), respectively; and 


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

2 paragraph: 

3 ‘‘(7) NON-EXCLUDABLE DRUGS.—The following 

4 drugs or classes of drugs, or their medical uses, shall 

5 not be excluded from coverage: 

6 ‘‘(A) Agents when used to promote smok7 ing cessation, including agents approved by the 

8 Food and Drug Administration under the over9 the-counter monograph process for purposes of 

10 promoting, and when used to promote, tobacco 

11 cessation. 

12 ‘‘(B) Barbiturates. 

13 ‘‘(C) Benzodiazepines.’’. 

14 (b) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to services furnished on or after 

16 January 1, 2014. 

17 SEC. 2503. PROVIDING ADEQUATE PHARMACY REIMBURSE18 MENT. 

19 (a) PHARMACY REIMBURSEMENT LIMITS.— 

20 (1) IN GENERAL.—Section 1927(e) of the So21 cial Security Act (42 U.S.C. 1396r–8(e)) is amend22 ed— 

23 (A) in paragraph (4), by striking ‘‘(or, ef24 fective January 1, 2007, two or more)’’; and 


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1 (B) by striking paragraph (5) and insert2 ing the following: 

3 ‘‘(5) USE OF AMP IN UPPER PAYMENT LIM4 ITS.—The Secretary shall calculate the Federal 

5 upper reimbursement limit established under para6 graph (4) as no less than 175 percent of the weight7 ed average (determined on the basis of utilization) of 

8 the most recently reported monthly average manu9 facturer prices for pharmaceutically and therapeuti10 cally equivalent multiple source drug products that 

11 are available for purchase by retail community phar12 macies on a nationwide basis. The Secretary shall 

13 implement a smoothing process for average manu14 facturer prices. Such process shall be similar to the 

15 smoothing process used in determining the average 

16 sales price of a drug or biological under section 

17 1847A.’’. 

18 (2) DEFINITION OF AMP.—Section 1927(k)(1) 

19 of such Act (42 U.S.C. 1396r–8(k)(1)) is amend20 ed— 

21 (A) in subparagraph (A), by striking ‘‘by’’ 

22 and all that follows through the period and in23 serting ‘‘by— 

24 ‘‘(i) wholesalers for drugs distributed 

25 to retail community pharmacies; and 


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1 ‘‘(ii) retail community pharmacies 

2 that purchase drugs directly from the man3 ufacturer.’’; and 

4 (B) by striking subparagraph (B) and in5 serting the following: 

6 ‘‘(B) EXCLUSION OF CUSTOMARY PROMPT

7 PAY DISCOUNTS AND OTHER PAYMENTS.— 

8 ‘‘(i) IN GENERAL.—The average man9 ufacturer price for a covered outpatient 

10 drug shall exclude— 

11 ‘‘(I) customary prompt pay dis12 counts extended to wholesalers; 

13 ‘‘(II) bona fide service fees paid 

14 by manufacturers to wholesalers or re15 tail community pharmacies, including 

16 (but not limited to) distribution serv17 ice fees, inventory management fees, 

18 product stocking allowances, and fees 

19 associated with administrative services 

20 agreements and patient care programs 

21 (such as medication compliance pro22 grams and patient education pro23 grams); 

24 ‘‘(III) reimbursement by manu25 facturers for recalled, damaged, exVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00505 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pired, or otherwise unsalable returned 

2 goods, including (but not limited to) 

3 reimbursement for the cost of the 

4 goods and any reimbursement of costs 

5 associated with return goods handling 

6 and processing, reverse logistics, and 

7 drug destruction; and 

8 ‘‘(IV) payments received from, 

9 and rebates or discounts provided to, 

10 pharmacy benefit managers, managed 

11 care organizations, health mainte12 nance organizations, insurers, hos13 pitals, clinics, mail order pharmacies, 

14 long term care providers, manufactur15 ers, or any other entity that does not 

16 conduct business as a wholesaler or a 

17 retail community pharmacy. 

18 ‘‘(ii) INCLUSION OF OTHER DIS19 COUNTS AND PAYMENTS.—Notwith20 standing clause (i), any other discounts, 

21 rebates, payments, or other financial trans22 actions that are received by, paid by, or 

23 passed through to, retail community phar24 macies shall be included in the average 


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1 manufacturer price for a covered out2 patient drug.’’; and 

3 (C) in subparagraph (C), by striking ‘‘the 

4 retail pharmacy class of trade’’ and inserting 

5 ‘‘retail community pharmacies’’. 

6 (3) DEFINITION OF MULTIPLE SOURCE

7 DRUG.—Section 1927(k)(7) of such Act (42 U.S.C. 

8 1396r–8(k)(7)) is amended— 

9 (A) in subparagraph (A)(i)(III), by strik10 ing ‘‘the State’’ and inserting ‘‘the United 

11 States’’; and 

12 (B) in subparagraph (C)— 

13 (i) in clause (i), by inserting ‘‘and’’ 

14 after the semicolon; 

15 (ii) in clause (ii), by striking ‘‘; and’’ 

16 and inserting a period; and 

17 (iii) by striking clause (iii). 

18 (4) DEFINITIONS OF RETAIL COMMUNITY PHAR19 MACY; WHOLESALER.—Section 1927(k) of such Act 

20 (42 U.S.C. 1396r–8(k)) is amended by adding at the 

21 end the following new paragraphs: 

22 ‘‘(10) RETAIL COMMUNITY PHARMACY.—The 

23 term ‘retail community pharmacy’ means an inde24 pendent pharmacy, a chain pharmacy, a super25 market pharmacy, or a mass merchandiser pharVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00507 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 macy that is licensed as a pharmacy by the State 

2 and that dispenses medications to the general public 

3 at retail prices. Such term does not include a phar4 macy that dispenses prescription medications to pa5 tients primarily through the mail, nursing home 

6 pharmacies, long-term care facility pharmacies, hos7 pital pharmacies, clinics, charitable or not-for-profit 

8 pharmacies, government pharmacies, or pharmacy 

9 benefit managers. 

10 ‘‘(11) WHOLESALER.—The term ‘wholesaler’ 

11 means a drug wholesaler that is engaged in whole12 sale distribution of prescription drugs to retail com13 munity pharmacies, including (but not limited to) 

14 manufacturers, repackers, distributors, own-label 

15 distributors, private-label distributors, jobbers, bro16 kers, warehouses (including manufacturer’s and dis17 tributor’s warehouses, chain drug warehouses, and 

18 wholesale drug warehouses) independent wholesale 

19 drug traders, and retail community pharmacies that 

20 conduct wholesale distributions.’’. 

21 (b) DISCLOSURE OF PRICE INFORMATION TO THE

22 PUBLIC.—Section 1927(b)(3) of such Act (42 U.S.C. 

23 1396r–8(b)(3)) is amended— 

24 (1) in subparagraph (A)— 


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1 (A) in the first sentence, by inserting after 

2 clause (iii) the following: 

3 ‘‘(iv) not later than 30 days after the 

4 last day of each month of a rebate period 

5 under the agreement, on the manufactur6 er’s total number of units that are used to 

7 calculate the monthly average manufac8 turer price for each covered outpatient 

9 drug;’’; and 

10 (B) in the second sentence, by inserting 

11 ‘‘(relating to the weighted average of the most 

12 recently reported monthly average manufacturer 

13 prices)’’ after ‘‘(D)(v)’’; and 

14 (2) in subparagraph (D)(v), by striking ‘‘aver15 age manufacturer prices’’ and inserting ‘‘the weight16 ed average of the most recently reported monthly av17 erage manufacturer prices and the average retail 

18 survey price determined for each multiple source 

19 drug in accordance with subsection (f)’’. 

20 (c) CLARIFICATION OF APPLICATION OF SURVEY OF

21 RETAIL PRICES.—Section 1927(f)(1) of such Act (42 

22 U.S.C. 1396r–8(b)(1)) is amended— 

23 (1) in subparagraph (A)(i), by inserting ‘‘with 

24 respect to a retail community pharmacy,’’ before 

25 ‘‘the determination’’; and 


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1 (2) in subparagraph (C)(ii), by striking ‘‘retail 

2 pharmacies’’ and inserting ‘‘retail community phar3 macies’’. 

4 (d) EFFECTIVE DATE.—The amendments made by 

5 this section shall take effect on the first day of the first 

6 calendar year quarter that begins at least 180 days after 

7 the date of enactment of this Act, without regard to 

8 whether or not final regulations to carry out such amend9 ments have been promulgated by such date. 

10 Subtitle G—Medicaid Dispropor11 tionate Share Hospital (DSH) 

12 Payments 

13 SEC. 2551. DISPROPORTIONATE SHARE HOSPITAL PAY14 MENTS. 

15 (a) IN GENERAL.—Section 1923(f) of the Social Se16 curity Act (42 U.S.C. 1396r–4(f)) is amended— 

17 (1) in paragraph (1), by striking ‘‘and (3)’’ and 

18 inserting ‘‘, (3), and (7)’’; 

19 (2) in paragraph (3)(A), by striking ‘‘paragraph 

20 (6)’’ and inserting ‘‘paragraphs (6) and (7)’’; 

21 (3) by redesignating paragraph (7) as para22 graph (8); and 

23 (4) by inserting after paragraph (6) the fol24 lowing new paragraph: 


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1 ‘‘(7) REDUCTION OF STATE DSH ALLOTMENTS

2 ONCE REDUCTION IN UNINSURED THRESHOLD

3 REACHED.— 

4 ‘‘(A) IN GENERAL.—Subject to subpara5 graph (E), the DSH allotment for a State for 

6 fiscal years beginning with the fiscal year de7 scribed in subparagraph (C) (with respect to 

8 the State), is equal to— 

9 ‘‘(i) in the case of the first fiscal year 

10 described in subparagraph (C) with respect 

11 to a State, the DSH allotment that would 

12 be determined under this subsection for 

13 the State for the fiscal year without appli14 cation of this paragraph (but after the ap15 plication of subparagraph (D)), reduced by 

16 the applicable percentage determined for 

17 the State for the fiscal year under sub18 paragraph (B)(i); and 

19 ‘‘(ii) in the case of any subsequent fis20 cal year with respect to the State, the 

21 DSH allotment determined under this 

22 paragraph for the State for the preceding 

23 fiscal year, reduced by the applicable per24 centage determined for the State for the 

25 fiscal year under subparagraph (B)(ii). 


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1 ‘‘(B) APPLICABLE PERCENTAGE.—For 

2 purposes of subparagraph (A), the applicable 

3 percentage for a State for a fiscal year is the 

4 following: 

5 ‘‘(i) UNINSURED REDUCTION THRESH6 OLD FISCAL YEAR.—In the case of the first 

7 fiscal year described in subparagraph (C) 

8 with respect to the State— 

9 ‘‘(I) if the State is a low DSH 

10 State described in paragraph (5)(B), 

11 the applicable percentage is equal to 

12 25 percent; and 

13 ‘‘(II) if the State is any other 

14 State, the applicable percentage is 50 

15 percent. 

16 ‘‘(ii) SUBSEQUENT FISCAL YEARS IN

17 WHICH THE PERCENTAGE OF UNINSURED

18 DECREASES.—In the case of any fiscal 

19 year after the first fiscal year described in 

20 subparagraph (C) with respect to a State, 

21 if the Secretary determines on the basis of 

22 the most recent American Community Sur23 vey of the Bureau of the Census, that the 

24 percentage of uncovered individuals resid25 ing in the State is less than the percentage 


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1 of such individuals determined for the 

2 State for the preceding fiscal year— 

3 ‘‘(I) if the State is a low DSH 

4 State described in paragraph (5)(B), 

5 the applicable percentage is equal to 

6 the product of the percentage reduc7 tion in uncovered individuals for the 

8 fiscal year from the preceding fiscal 

9 year and 25 percent; and 

10 ‘‘(II) if the State is any other 

11 State, the applicable percentage is 

12 equal to the product of the percentage 

13 reduction in uncovered individuals for 

14 the fiscal year from the preceding fis15 cal year and 50 percent. 

16 ‘‘(C) FISCAL YEAR DESCRIBED.—For pur17 poses of subparagraph (A), the fiscal year de18 scribed in this subparagraph with respect to a 

19 State is the first fiscal year that occurs after 

20 fiscal year 2012 for which the Secretary deter21 mines, on the basis of the most recent Amer22 ican Community Survey of the Bureau of the 

23 Census, that the percentage of uncovered indi24 viduals residing in the State is at least 45 per25 cent less than the percentage of such individVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00513 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 uals determined for the State for fiscal year 

2 2009. 

3 ‘‘(D) EXCLUSION OF PORTIONS DIVERTED

4 FOR COVERAGE EXPANSIONS.—For purposes of 

5 applying the applicable percentage reduction 

6 under subparagraph (A) to the DSH allotment 

7 for a State for a fiscal year, the DSH allotment 

8 for a State that would be determined under this 

9 subsection for the State for the fiscal year with10 out the application of this paragraph (and prior 

11 to any such reduction) shall not include any 

12 portion of the allotment for which the Secretary 

13 has approved the State’s diversion to the costs 

14 of providing medical assistance or other health 

15 benefits coverage under a waiver that is in ef16 fect on July 2009. 

17 ‘‘(E) MINIMUM ALLOTMENT.—In no event 

18 shall the DSH allotment determined for a State 

19 in accordance with this paragraph for fiscal 

20 year 2013 or any succeeding fiscal year be less 

21 than the amount equal to 35 percent of the 

22 DSH allotment determined for the State for fis23 cal year 2012 under this subsection (and after 

24 the application of this paragraph, if applicable), 

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1 sumer price index for all urban consumers (all 

2 items, U.S. city average) for each previous fis3 cal year occurring before the fiscal year. 

4 ‘‘(F) UNCOVERED INDIVIDUALS.—In this 

5 paragraph, the term ‘uncovered individuals’ 

6 means individuals with no health insurance cov7 erage at any time during a year (as determined 

8 by the Secretary based on the most recent data 

9 available).’’. 

10 (b) EFFECTIVE DATE.—The amendments made by 

11 subsection (a) take effect on October 1, 2011. 

12 Subtitle H—Improved Coordina13 tion for Dual Eligible Bene14 ficiaries 

15 SEC. 2601. 5-YEAR PERIOD FOR DEMONSTRATION 

16 PROJECTS. 

17 (a) IN GENERAL.—Section 1915(h) of the Social Se18 curity Act (42 U.S.C. 1396n(h)) is amended— 

19 (1) by inserting ‘‘(1)’’ after ‘‘(h)’’; 

20 (2) by inserting ‘‘, or a waiver described in 

21 paragraph (2)’’ after ‘‘(e)’’; and 

22 (3) by adding at the end the following new 

23 paragraph: 

24 ‘‘(2)(A) Notwithstanding subsections (c)(3) and (d) 

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1 er under section 1115, that provides medical assistance 

2 for dual eligible individuals (including any such waivers 

3 under which non dual eligible individuals may be enrolled 

4 in addition to dual eligible individuals) may be conducted 

5 for a period of 5 years and, upon the request of the State, 

6 may be extended for additional 5-year periods unless the 

7 Secretary determines that for the previous waiver period 

8 the conditions for the waiver have not been met or it would 

9 no longer be cost-effective and efficient, or consistent with 

10 the purposes of this title, to extend the waiver. 

11 ‘‘(B) In this paragraph, the term ‘dual eligible indi12 vidual’ means an individual who is entitled to, or enrolled 

13 for, benefits under part A of title XVIII, or enrolled for 

14 benefits under part B of title XVIII, and is eligible for 

15 medical assistance under the State plan under this title 

16 or under a waiver of such plan.’’. 

17 (b) CONFORMING AMENDMENTS.— 

18 (1) Section 1915 of such Act (42 U.S.C. 

19 1396n) is amended— 

20 (A) in subsection (b), by adding at the end 

21 the following new sentence: ‘‘Subsection (h)(2) 

22 shall apply to a waiver under this subsection.’’; 

23 (B) in subsection (c)(3), in the second sen24 tence, by inserting ‘‘(other than a waiver deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00516 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 scribed in subsection (h)(2))’’ after ‘‘A waiver 

2 under this subsection’’; 

3 (C) in subsection (d)(3), in the second sen4 tence, by inserting ‘‘(other than a waiver de5 scribed in subsection (h)(2))’’ after ‘‘A waiver 

6 under this subsection’’. 

7 (2) Section 1115 of such Act (42 U.S.C. 1315) 

8 is amended— 

9 (A) in subsection (e)(2), by inserting ‘‘(5 

10 years, in the case of a waiver described in sec11 tion 1915(h)(2))’’ after ‘‘3 years’’; and 

12 (B) in subsection (f)(6), by inserting ‘‘(5 

13 years, in the case of a waiver described in sec14 tion 1915(h)(2))’’ after ‘‘3 years’’. 

15 SEC. 2602. PROVIDING FEDERAL COVERAGE AND PAYMENT 

16 COORDINATION FOR DUAL ELIGIBLE BENE17 FICIARIES. 

18 (a) ESTABLISHMENT OF FEDERAL COORDINATED

19 HEALTH CARE OFFICE.— 

20 (1) IN GENERAL.—Not later than March 1, 

21 2010, the Secretary of Health and Human Services 

22 (in this section referred to as the ‘‘Secretary’’) shall 

23 establish a Federal Coordinated Health Care Office. 


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1 (2) ESTABLISHMENT AND REPORTING TO CMS

2 ADMINISTRATOR.—The Federal Coordinated Health 

3 Care Office— 

4 (A) shall be established within the Centers 

5 for Medicare & Medicaid Services; and 

6 (B) have as the Office a Director who shall 

7 be appointed by, and be in direct line of author8 ity to, the Administrator of the Centers for 

9 Medicare & Medicaid Services. 

10 (b) PURPOSE.—The purpose of the Federal Coordi11 nated Health Care Office is to bring together officers and 

12 employees of the Medicare and Medicaid programs at the 

13 Centers for Medicare & Medicaid Services in order to— 

14 (1) more effectively integrate benefits under the 

15 Medicare program under title XVIII of the Social 

16 Security Act and the Medicaid program under title 

17 XIX of such Act; and 

18 (2) improve the coordination between the Fed19 eral Government and States for individuals eligible 

20 for benefits under both such programs in order to 

21 ensure that such individuals get full access to the 

22 items and services to which they are entitled under 

23 titles XVIII and XIX of the Social Security Act. 

24 (c) GOALS.—The goals of the Federal Coordinated 

25 Health Care Office are as follows: 


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1 (1) Providing dual eligible individuals full ac2 cess to the benefits to which such individuals are en3 titled under the Medicare and Medicaid programs. 

4 (2) Simplifying the processes for dual eligible 

5 individuals to access the items and services they are 

6 entitled to under the Medicare and Medicaid pro7 grams. 

8 (3) Improving the quality of health care and 

9 long-term services for dual eligible individuals. 

10 (4) Increasing dual eligible individuals’ under11 standing of and satisfaction with coverage under the 

12 Medicare and Medicaid programs. 

13 (5) Eliminating regulatory conflicts between 

14 rules under the Medicare and Medicaid programs. 

15 (6) Improving care continuity and ensuring safe 

16 and effective care transitions for dual eligible indi17 viduals. 

18 (7) Eliminating cost-shifting between the Medi19 care and Medicaid program and among related 

20 health care providers. 

21 (8) Improving the quality of performance of 

22 providers of services and suppliers under the Medi23 care and Medicaid programs. 


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1 (d) SPECIFIC RESPONSIBILITIES.—The specific re2 sponsibilities of the Federal Coordinated Health Care Of3 fice are as follows: 

4 (1) Providing States, specialized MA plans for 

5 special needs individuals (as defined in section 

6 1859(b)(6) of the Social Security Act (42 U.S.C. 

7 1395w–28(b)(6))), physicians and other relevant en8 tities or individuals with the education and tools nec9 essary for developing programs that align benefits 

10 under the Medicare and Medicaid programs for dual 

11 eligible individuals. 

12 (2) Supporting State efforts to coordinate and 

13 align acute care and long-term care services for dual 

14 eligible individuals with other items and services fur15 nished under the Medicare program. 

16 (3) Providing support for coordination of con17 tracting and oversight by States and the Centers for 

18 Medicare & Medicaid Services with respect to the in19 tegration of the Medicare and Medicaid programs in 

20 a manner that is supportive of the goals described 

21 in paragraph (3). 

22 (4) To consult and coordinate with the Medi23 care Payment Advisory Commission established 

24 under section 1805 of the Social Security Act (42 

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1 ment and Access Commission established under sec2 tion 1900 of such Act (42 U.S.C. 1396) with respect 

3 to policies relating to the enrollment in, and provi4 sion of, benefits to dual eligible individuals under the 

5 Medicare program under title XVIII of the Social 

6 Security Act and the Medicaid program under title 

7 XIX of such Act. 

8 (5) To study the provision of drug coverage for 

9 new full-benefit dual eligible individuals (as defined 

10 in section 1935(c)(6) of the Social Security Act (42 

11 U.S.C. 1396u–5(c)(6)), as well as to monitor and re12 port annual total expenditures, health outcomes, and 

13 access to benefits for all dual eligible individuals. 

14 (e) REPORT.—The Secretary shall, as part of the 

15 budget transmitted under section 1105(a) of title 31, 

16 United States Code, submit to Congress an annual report 

17 containing recommendations for legislation that would im18 prove care coordination and benefits for dual eligible indi19 viduals. 

20 (f) DUAL ELIGIBLE DEFINED.—In this section, the 

21 term ‘‘dual eligible individual’’ means an individual who 

22 is entitled to, or enrolled for, benefits under part A of title 

23 XVIII of the Social Security Act, or enrolled for benefits 

24 under part B of title XVIII of such Act, and is eligible 


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1 for medical assistance under a State plan under title XIX 

2 of such Act or under a waiver of such plan. 

3 Subtitle I—Improving the Quality 

4 of Medicaid for Patients and 

5 Providers 

6 SEC. 2701. ADULT HEALTH QUALITY MEASURES. 

7 Title XI of the Social Security Act (42 U.S.C. 1301 

8 et seq.), as amended by section 401 of the Children’s 

9 Health Insurance Program Reauthorization Act of 2009 

10 (Public Law 111-3), is amended by inserting after section 

11 1139A the following new section: 

12 ‘‘SEC. 1139B. ADULT HEALTH QUALITY MEASURES. 

13 ‘‘(a) DEVELOPMENT OF CORE SET OF HEALTH CARE

14 QUALITY MEASURES FOR ADULTS ELIGIBLE FOR BENE15 FITS UNDER MEDICAID.—The Secretary shall identify 

16 and publish a recommended core set of adult health qual17 ity measures for Medicaid eligible adults in the same man18 ner as the Secretary identifies and publishes a core set 

19 of child health quality measures under section 1139A, in20 cluding with respect to identifying and publishing existing 

21 adult health quality measures that are in use under public 

22 and privately sponsored health care coverage arrange23 ments, or that are part of reporting systems that measure 

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1 erage over time, that may be applicable to Medicaid eligi2 ble adults. 

3 ‘‘(b) DEADLINES.— 

4 ‘‘(1) RECOMMENDED MEASURES.—Not later 

5 than January 1, 2011, the Secretary shall identify 

6 and publish for comment a recommended core set of 

7 adult health quality measures for Medicaid eligible 

8 adults. 

9 ‘‘(2) DISSEMINATION.—Not later than January 

10 1, 2012, the Secretary shall publish an initial core 

11 set of adult health quality measures that are appli12 cable to Medicaid eligible adults. 

13 ‘‘(3) STANDARDIZED REPORTING.—Not later 

14 than January 1, 2013, the Secretary, in consultation 

15 with States, shall develop a standardized format for 

16 reporting information based on the initial core set of 

17 adult health quality measures and create procedures 

18 to encourage States to use such measures to volun19 tarily report information regarding the quality of 

20 health care for Medicaid eligible adults. 

21 ‘‘(4) REPORTS TO CONGRESS.—Not later than 

22 January 1, 2014, and every 3 years thereafter, the 

23 Secretary shall include in the report to Congress re24 quired under section 1139A(a)(6) information simi25 lar to the information required under that section 


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1 with respect to the measures established under this 

2 section. 

3 ‘‘(5) ESTABLISHMENT OF MEDICAID QUALITY

4 MEASUREMENT PROGRAM.— 

5 ‘‘(A) IN GENERAL.—Not later than 12 

6 months after the release of the recommended 

7 core set of adult health quality measures under 

8 paragraph (1)), the Secretary shall establish a 

9 Medicaid Quality Measurement Program in the 

10 same manner as the Secretary establishes the 

11 pediatric quality measures program under sec12 tion 1139A(b). The aggregate amount awarded 

13 by the Secretary for grants and contracts for 

14 the development, testing, and validation of 

15 emerging and innovative evidence-based meas16 ures under such program shall equal the aggre17 gate amount awarded by the Secretary for 

18 grants under section 1139A(b)(4)(A) 

19 ‘‘(B) REVISING, STRENGTHENING, AND IM20 PROVING INITIAL CORE MEASURES.—Beginning 

21 not later than 24 months after the establish22 ment of the Medicaid Quality Measurement 

23 Program, and annually thereafter, the Sec24 retary shall publish recommended changes to 

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1 ures that shall reflect the results of the testing, 

2 validation, and consensus process for the devel3 opment of adult health quality measures. 

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

5 be construed as supporting the restriction of coverage, 

6 under title XIX or XXI or otherwise, to only those services 

7 that are evidence-based, or in anyway limiting available 

8 services. 

9 ‘‘(d) ANNUAL STATE REPORTS REGARDING STATE10 SPECIFIC QUALITY OF CARE MEASURES APPLIED UNDER

11 MEDICAID.— 

12 ‘‘(1) ANNUAL STATE REPORTS.—Each State 

13 with a State plan or waiver approved under title 

14 XIX shall annually report (separately or as part of 

15 the annual report required under section 1139A(c)), 

16 to the Secretary on the— 

17 ‘‘(A) State-specific adult health quality 

18 measures applied by the State under the such 

19 plan, including measures described in sub20 section (a)(5); and 

21 ‘‘(B) State-specific information on the 

22 quality of health care furnished to Medicaid eli23 gible adults under such plan, including informa24 tion collected through external quality reviews 


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1 of managed care organizations under section 

2 1932 and benchmark plans under section 1937. 

3 ‘‘(2) PUBLICATION.—Not later than September 

4 30, 2014, and annually thereafter, the Secretary 

5 shall collect, analyze, and make publicly available the 

6 information reported by States under paragraph (1). 

7 ‘‘(e) APPROPRIATION.—Out of any funds in the 

8 Treasury not otherwise appropriated, there is appro9 priated for each of fiscal years 2010 through 2014, 

10 $60,000,000 for the purpose of carrying out this section. 

11 Funds appropriated under this subsection shall remain 

12 available until expended.’’. 

13 SEC. 2702. PAYMENT ADJUSTMENT FOR HEALTH CARE-AC14 QUIRED CONDITIONS. 

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

16 Human Services (in this subsection referred to as the 

17 ‘‘Secretary’’) shall identify current State practices that 

18 prohibit payment for health care-acquired conditions and 

19 shall incorporate the practices identified, or elements of 

20 such practices, which the Secretary determines appro21 priate for application to the Medicaid program in regula22 tions. Such regulations shall be effective as of July 1, 

23 2011, and shall prohibit payments to States under section 

24 1903 of the Social Security Act for any amounts expended 

25 for providing medical assistance for health care-acquired 


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1 conditions specified in the regulations. The regulations 

2 shall ensure that the prohibition on payment for health 

3 care-acquired conditions shall not result in a loss of access 

4 to care or services for Medicaid beneficiaries. 

5 (b) HEALTH CARE-ACQUIRED CONDITION.—In this 

6 section. the term ‘‘health care-acquired condition’’ means 

7 a medical condition for which an individual was diagnosed 

8 that could be identified by a secondary diagnostic code de9 scribed in section 1886(d)(4)(D)(iv) of the Social Security 

10 Act (42 U.S.C. 1395ww(d)(4)(D)(iv)). 

11 (c) MEDICARE PROVISIONS.—In carrying out this 

12 section, the Secretary shall apply to State plans (or waiv13 ers) under title XIX of the Social Security Act the regula14 tions promulgated pursuant to section 1886(d)(4)(D) of 

15 such Act (42 U.S.C. 1395ww(d)(4)(D)) relating to the 

16 prohibition of payments based on the presence of a sec17 ondary diagnosis code specified by the Secretary in such 

18 regulations, as appropriate for the Medicaid program. The 

19 Secretary may exclude certain conditions identified under 

20 title XVIII of the Social Security Act for non-payment 

21 under title XIX of such Act when the Secretary finds the 

22 inclusion of such conditions to be inapplicable to bene23 ficiaries under title XIX. 


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1 SEC. 2703. STATE OPTION TO PROVIDE HEALTH HOMES 

2 FOR ENROLLEES WITH CHRONIC CONDI3 TIONS. 

4 (a) STATE PLAN AMENDMENT.—Title XIX of the So5 cial Security Act (42 U.S.C. 1396a et seq.), as amended 

6 by sections 2201 and 2305, is amended by adding at the 

7 end the following new section: 

8 ‘‘SEC. 1945. STATE OPTION TO PROVIDE COORDI9 NATED CARE THROUGH A HEALTH HOME FOR INDIVID10 UALS WITH CHRONIC CONDITIONS.— 

11 ‘‘(a) IN GENERAL.—Notwithstanding section 

12 1902(a)(1) (relating to statewideness), section 

13 1902(a)(10)(B) (relating to comparability), and any other 

14 provision of this title for which the Secretary determines 

15 it is necessary to waive in order to implement this section, 

16 beginning January 1, 2011, a State, at its option as a 

17 State plan amendment, may provide for medical assistance 

18 under this title to eligible individuals with chronic condi19 tions who select a designated provider (as described under 

20 subsection (h)(5)), a team of health care professionals (as 

21 described under subsection (h)(6)) operating with such a 

22 provider, or a health team (as described under subsection 

23 (h)(7)) as the individual’s health home for purposes of 

24 providing the individual with health home services. 

25 ‘‘(b) HEALTH HOME QUALIFICATION STANDARDS.— 

26 The Secretary shall establish standards for qualification 


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1 as a designated provider for the purpose of being eligible 

2 to be a health home for purposes of this section. 

3 ‘‘(c) PAYMENTS.— 

4 ‘‘(1) IN GENERAL.—A State shall provide a des5 ignated provider, a team of health care professionals 

6 operating with such a provider, or a health team 

7 with payments for the provision of health home serv8 ices to each eligible individual with chronic condi9 tions that selects such provider, team of health care 

10 professionals, or health team as the individual’s 

11 health home. Payments made to a designated pro12 vider, a team of health care professionals operating 

13 with such a provider, or a health team for such serv14 ices shall be treated as medical assistance for pur15 poses of section 1903(a), except that, during the 

16 first 8 fiscal year quarters that the State plan 

17 amendment is in effect, the Federal medical assist18 ance percentage applicable to such payments shall be 

19 equal to 90 percent. 

20 ‘‘(2) METHODOLOGY.— 

21 ‘‘(A) IN GENERAL.—The State shall speci22 fy in the State plan amendment the method23 ology the State will use for determining pay24 ment for the provision of health home services. 

25 Such methodology for determining payment— 


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1 ‘‘(i) may be tiered to reflect, with re2 spect to each eligible individual with chron3 ic conditions provided such services by a 

4 designated provider, a team of health care 

5 professionals operating with such a pro6 vider, or a health team, as well as the se7 verity or number of each such individual’s 

8 chronic conditions or the specific capabili9 ties of the provider, team of health care 

10 professionals, or health team; and 

11 ‘‘(ii) shall be established consistent 

12 with section 1902(a)(30)(A). 

13 ‘‘(B) ALTERNATE MODELS OF PAYMENT.— 

14 The methodology for determining payment for 

15 provision of health home services under this 

16 section shall not be limited to a per-member 

17 per-month basis and may provide (as proposed 

18 by the State and subject to approval by the 

19 Secretary) for alternate models of payment. 

20 ‘‘(3) PLANNING GRANTS.— 

21 ‘‘(A) IN GENERAL.—Beginning January 1, 

22 2011, the Secretary may award planning grants 

23 to States for purposes of developing a State 

24 plan amendment under this section. A planning 


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1 grant awarded to a State under this paragraph 

2 shall remain available until expended. 

3 ‘‘(B) STATE CONTRIBUTION.—A State 

4 awarded a planning grant shall contribute an 

5 amount equal to the State percentage deter6 mined under section 1905(b) (without regard to 

7 section 5001 of Public Law 111–5) for each fis8 cal year for which the grant is awarded. 

9 ‘‘(C) LIMITATION.—The total amount of 

10 payments made to States under this paragraph 

11 shall not exceed $25,000,000. 

12 ‘‘(d) HOSPITAL REFERRALS.—A State shall include 

13 in the State plan amendment a requirement for hospitals 

14 that are participating providers under the State plan or 

15 a waiver of such plan to establish procedures for referring 

16 any eligible individuals with chronic conditions who seek 

17 or need treatment in a hospital emergency department to 

18 designated providers. 

19 ‘‘(e) COORDINATION.—A State shall consult and co20 ordinate, as appropriate, with the Substance Abuse and 

21 Mental Health Services Administration in addressing 

22 issues regarding the prevention and treatment of mental 

23 illness and substance abuse among eligible individuals with 

24 chronic conditions. 


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1 ‘‘(f) MONITORING.—A State shall include in the State 

2 plan amendment— 

3 ‘‘(1) a methodology for tracking avoidable hos4 pital readmissions and calculating savings that re5 sult from improved chronic care coordination and 

6 management under this section; and 

7 ‘‘(2) a proposal for use of health information 

8 technology in providing health home services under 

9 this section and improving service delivery and co10 ordination across the care continuum (including the 

11 use of wireless patient technology to improve coordi12 nation and management of care and patient adher13 ence to recommendations made by their provider). 

14 ‘‘(g) REPORT ON QUALITY MEASURES.—As a condi15 tion for receiving payment for health home services pro16 vided to an eligible individual with chronic conditions, a 

17 designated provider shall report to the State, in accord18 ance with such requirements as the Secretary shall specify, 

19 on all applicable measures for determining the quality of 

20 such services. When appropriate and feasible, a designated 

21 provider shall use health information technology in pro22 viding the State with such information. 

23 ‘‘(h) DEFINITIONS.—In this section: 

24 ‘‘(1) ELIGIBLE INDIVIDUAL WITH CHRONIC

25 CONDITIONS.— 


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1 ‘‘(A) IN GENERAL.—Subject to subpara2 graph (B), the term ‘eligible individual with 

3 chronic conditions’ means an individual who— 

4 ‘‘(i) is eligible for medical assistance 

5 under the State plan or under a waiver of 

6 such plan; and 

7 ‘‘(ii) has at least— 

8 ‘‘(I) 2 chronic conditions; 

9 ‘‘(II) 1 chronic condition and is 

10 at risk of having a second chronic 

11 condition; or 

12 ‘‘(III) 1 serious and persistent 

13 mental health condition. 

14 ‘‘(B) RULE OF CONSTRUCTION.—Nothing 

15 in this paragraph shall prevent the Secretary 

16 from establishing higher levels as to the number 

17 or severity of chronic or mental health condi18 tions for purposes of determining eligibility for 

19 receipt of health home services under this sec20 tion. 

21 ‘‘(2) CHRONIC CONDITION.—The term ‘chronic 

22 condition’ has the meaning given that term by the 

23 Secretary and shall include, but is not limited to, the 

24 following: 

25 ‘‘(A) A mental health condition. 


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1 ‘‘(B) Substance use disorder. 

2 ‘‘(C) Asthma. 

3 ‘‘(D) Diabetes. 

4 ‘‘(E) Heart disease. 

5 ‘‘(F) Being overweight, as evidenced by 

6 having a Body Mass Index (BMI) over 25. 

7 ‘‘(3) HEALTH HOME.—The term ‘health home’ 

8 means a designated provider (including a provider 

9 that operates in coordination with a team of health 

10 care professionals) or a health team selected by an 

11 eligible individual with chronic conditions to provide 

12 health home services. 

13 ‘‘(4) HEALTH HOME SERVICES.— 

14 ‘‘(A) IN GENERAL.—The term ‘health 

15 home services’ means comprehensive and timely 

16 high-quality services described in subparagraph 

17 (B) that are provided by a designated provider, 

18 a team of health care professionals operating 

19 with such a provider, or a health team. 

20 ‘‘(B) SERVICES DESCRIBED.—The services 

21 described in this subparagraph are— 

22 ‘‘(i) comprehensive care management; 

23 ‘‘(ii) care coordination and health pro24 motion; 


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1 ‘‘(iii) comprehensive transitional care, 

2 including appropriate follow-up, from inpa3 tient to other settings; 

4 ‘‘(iv) patient and family support (in5 cluding authorized representatives); 

6 ‘‘(v) referral to community and social 

7 support services, if relevant; and 

8 ‘‘(vi) use of health information tech9 nology to link services, as feasible and ap10 propriate. 

11 ‘‘(5) DESIGNATED PROVIDER.—The term ‘des12 ignated provider’ means a physician, clinical practice 

13 or clinical group practice, rural clinic, community 

14 health center, community mental health center, 

15 home health agency, or any other entity or provider 

16 (including pediatricians, gynecologists, and obstetri17 cians) that is determined by the State and approved 

18 by the Secretary to be qualified to be a health home 

19 for eligible individuals with chronic conditions on the 

20 basis of documentation evidencing that the physi21 cian, practice, or clinic— 

22 ‘‘(A) has the systems and infrastructure in 

23 place to provide health home services; and 


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1 ‘‘(B) satisfies the qualification standards 

2 established by the Secretary under subsection 

3 (b). 

4 ‘‘(6) TEAM OF HEALTH CARE PROFES5 SIONALS.—The term ‘team of health care profes6 sionals’ means a team of health professionals (as de7 scribed in the State plan amendment) that may— 

8 ‘‘(A) include physicians and other profes9 sionals, such as a nurse care coordinator, nutri10 tionist, social worker, behavioral health profes11 sional, or any professionals deemed appropriate 

12 by the State; and 

13 ‘‘(B) be free standing, virtual, or based at 

14 a hospital, community health center, community 

15 mental health center, rural clinic, clinical prac16 tice or clinical group practice, academic health 

17 center, or any entity deemed appropriate by the 

18 State and approved by the Secretary. 

19 ‘‘(7) HEALTH TEAM.—The term ‘health team’ 

20 has the meaning given such term for purposes of 

21 section 3502 of the Patient Protection and Afford22 able Care Act.’’. 

23 (b) EVALUATION.— 

24 (1) INDEPENDENT EVALUATION.— 


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1 (A) IN GENERAL.—The Secretary shall 

2 enter into a contract with an independent entity 

3 or organization to conduct an evaluation and 

4 assessment of the States that have elected the 

5 option to provide coordinated care through a 

6 health home for Medicaid beneficiaries with 

7 chronic conditions under section 1945 of the 

8 Social Security Act (as added by subsection (a)) 

9 for the purpose of determining the effect of 

10 such option on reducing hospital admissions, 

11 emergency room visits, and admissions to 

12 skilled nursing facilities. 

13 (B) EVALUATION REPORT.—Not later than 

14 January 1, 2017, the Secretary shall report to 

15 Congress on the evaluation and assessment con16 ducted under subparagraph (A). 

17 (2) SURVEY AND INTERIM REPORT.— 

18 (A) IN GENERAL.—Not later than January 

19 1, 2014, the Secretary of Health and Human 

20 Services shall survey States that have elected 

21 the option under section 1945 of the Social Se22 curity Act (as added by subsection (a)) and re23 port to Congress on the nature, extent, and use 

24 of such option, particularly as it pertains to— 

25 (i) hospital admission rates; 


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1 (ii) chronic disease management; 

2 (iii) coordination of care for individ3 uals with chronic conditions; 

4 (iv) assessment of program implemen5 tation; 

6 (v) processes and lessons learned (as 

7 described in subparagraph (B)); 

8 (vi) assessment of quality improve9 ments and clinical outcomes under such 

10 option; and 

11 (vii) estimates of cost savings. 

12 (B) IMPLEMENTATION REPORTING.—A 

13 State that has elected the option under section 

14 1945 of the Social Security Act (as added by 

15 subsection (a)) shall report to the Secretary, as 

16 necessary, on processes that have been devel17 oped and lessons learned regarding provision of 

18 coordinated care through a health home for 

19 Medicaid beneficiaries with chronic conditions 

20 under such option. 

21 SEC. 2704. DEMONSTRATION PROJECT TO EVALUATE INTE22 GRATED CARE AROUND A HOSPITALIZATION. 

23 (a) AUTHORITY TO CONDUCT PROJECT.— 

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

25 Human Services (in this section referred to as the 


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1 ‘‘Secretary’’) shall establish a demonstration project 

2 under title XIX of the Social Security Act to evalu3 ate the use of bundled payments for the provision of 

4 integrated care for a Medicaid beneficiary— 

5 (A) with respect to an episode of care that 

6 includes a hospitalization; and 

7 (B) for concurrent physicians services pro8 vided during a hospitalization. 

9 (2) DURATION.—The demonstration project 

10 shall begin on January 1, 2012, and shall end on 

11 December 31, 2016. 

12 (b) REQUIREMENTS.—The demonstration project 

13 shall be conducted in accordance with the following: 

14 (1) The demonstration project shall be con15 ducted in up to 8 States, determined by the Sec16 retary based on consideration of the potential to 

17 lower costs under the Medicaid program while im18 proving care for Medicaid beneficiaries. A State se19 lected to participate in the demonstration project 

20 may target the demonstration project to particular 

21 categories of beneficiaries, beneficiaries with par22 ticular diagnoses, or particular geographic regions of 

23 the State, but the Secretary shall insure that, as a 

24 whole, the demonstration project is, to the greatest 

25 extent possible, representative of the demographic 


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1 and geographic composition of Medicaid beneficiaries 

2 nationally. 

3 (2) The demonstration project shall focus on 

4 conditions where there is evidence of an opportunity 

5 for providers of services and suppliers to improve the 

6 quality of care furnished to Medicaid beneficiaries 

7 while reducing total expenditures under the State 

8 Medicaid programs selected to participate, as deter9 mined by the Secretary. 

10 (3) A State selected to participate in the dem11 onstration project shall specify the 1 or more epi12 sodes of care the State proposes to address in the 

13 project, the services to be included in the bundled 

14 payments, and the rationale for the selection of such 

15 episodes of care and services. The Secretary may 

16 modify the episodes of care as well as the services 

17 to be included in the bundled payments prior to or 

18 after approving the project. The Secretary may also 

19 vary such factors among the different States partici20 pating in the demonstration project. 

21 (4) The Secretary shall ensure that payments 

22 made under the demonstration project are adjusted 

23 for severity of illness and other characteristics of 

24 Medicaid beneficiaries within a category or having a 

25 diagnosis targeted as part of the demonstration 


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1 project. States shall ensure that Medicaid bene2 ficiaries are not liable for any additional cost sharing 

3 than if their care had not been subject to payment 

4 under the demonstration project. 

5 (5) Hospitals participating in the demonstration 

6 project shall have or establish robust discharge plan7 ning programs to ensure that Medicaid beneficiaries 

8 requiring post-acute care are appropriately placed in, 

9 or have ready access to, post-acute care settings. 

10 (6) The Secretary and each State selected to 

11 participate in the demonstration project shall ensure 

12 that the demonstration project does not result in the 

13 Medicaid beneficiaries whose care is subject to pay14 ment under the demonstration project being pro15 vided with less items and services for which medical 

16 assistance is provided under the State Medicaid pro17 gram than the items and services for which medical 

18 assistance would have been provided to such bene19 ficiaries under the State Medicaid program in the 

20 absence of the demonstration project. 

21 (c) WAIVER OF PROVISIONS.—Notwithstanding sec22 tion 1115(a) of the Social Security Act (42 U.S.C. 

23 1315(a)), the Secretary may waive such provisions of titles 

24 XIX, XVIII, and XI of that Act as may be necessary to 

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1 ficiary access to acute and post-acute care, and maintain 

2 quality of care. 

3 (d) EVALUATION AND REPORT.— 

4 (1) DATA.—Each State selected to participate 

5 in the demonstration project under this section shall 

6 provide to the Secretary, in such form and manner 

7 as the Secretary shall specify, relevant data nec8 essary to monitor outcomes, costs, and quality, and 

9 evaluate the rationales for selection of the episodes 

10 of care and services specified by States under sub11 section (b)(3). 

12 (2) REPORT.—Not later than 1 year after the 

13 conclusion of the demonstration project, the Sec14 retary shall submit a report to Congress on the re15 sults of the demonstration project. 

16 SEC. 2705. MEDICAID GLOBAL PAYMENT SYSTEM DEM17 ONSTRATION PROJECT. 

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

19 Human Services (referred to in this section as the ‘‘Sec20 retary’’) shall, in coordination with the Center for Medi21 care and Medicaid Innovation (as established under sec22 tion 1115A of the Social Security Act, as added by section 

23 3021 of this Act), establish the Medicaid Global Payment 

24 System Demonstration Project under which a partici25 pating State shall adjust the payments made to an eligible 


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1 safety net hospital system or network from a fee-for-serv2 ice payment structure to a global capitated payment 

3 model. 

4 (b) DURATION AND SCOPE.—The demonstration 

5 project conducted under this section shall operate during 

6 a period of fiscal years 2010 through 2012. The Secretary 

7 shall select not more than 5 States to participate in the 

8 demonstration project. 

9 (c) ELIGIBLE SAFETY NET HOSPITAL SYSTEM OR

10 NETWORK.—For purposes of this section, the term ‘‘eligi11 ble safety net hospital system or network’’ means a large, 

12 safety net hospital system or network (as defined by the 

13 Secretary) that operates within a State selected by the 

14 Secretary under subsection (b). 

15 (d) EVALUATION.— 

16 (1) TESTING.—The Innovation Center shall test 

17 and evaluate the demonstration project conducted 

18 under this section to examine any changes in health 

19 care quality outcomes and spending by the eligible 

20 safety net hospital systems or networks. 

21 (2) BUDGET NEUTRALITY.—During the testing 

22 period under paragraph (1), any budget neutrality 

23 requirements under section 1115A(b)(3) of the So24 cial Security Act (as so added) shall not be applica25 ble. 


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1 (3) MODIFICATION.—During the testing period 

2 under paragraph (1), the Secretary may, in the Sec3 retary’s discretion, modify or terminate the dem4 onstration project conducted under this section. 

5 (e) REPORT.—Not later than 12 months after the 

6 date of completion of the demonstration project under this 

7 section, the Secretary shall submit to Congress a report 

8 containing the results of the evaluation and testing con9 ducted under subsection (d), together with recommenda10 tions for such legislation and administrative action as the 

11 Secretary determines appropriate. 

12 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

13 are authorized to be appropriated such sums as are nec14 essary to carry out this section. 

15 SEC. 2706. PEDIATRIC ACCOUNTABLE CARE ORGANIZATION 

16 DEMONSTRATION PROJECT. 

17 (a) AUTHORITY TO CONDUCT DEMONSTRATION.— 

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

19 Human Services (referred to in this section as the 

20 ‘‘Secretary’’) shall establish the Pediatric Account21 able Care Organization Demonstration Project to 

22 authorize a participating State to allow pediatric 

23 medical providers that meet specified requirements 

24 to be recognized as an accountable care organization 

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1 scribed under subsection (d)), in the same manner 

2 as an accountable care organization is recognized 

3 and provided with incentive payments under section 

4 1899 of the Social Security Act (as added by section 

5 3022). 

6 (2) DURATION.—The demonstration project 

7 shall begin on January 1, 2012, and shall end on 

8 December 31, 2016. 

9 (b) APPLICATION.—A State that desires to partici10 pate in the demonstration project under this section shall 

11 submit to the Secretary an application at such time, in 

12 such manner, and containing such information as the Sec13 retary may require. 

14 (c) REQUIREMENTS.— 

15 (1) PERFORMANCE GUIDELINES.—The Sec16 retary, in consultation with the States and pediatric 

17 providers, shall establish guidelines to ensure that 

18 the quality of care delivered to individuals by a pro19 vider recognized as an accountable care organization 

20 under this section is not less than the quality of care 

21 that would have otherwise been provided to such in22 dividuals. 

23 (2) SAVINGS REQUIREMENT.—A participating 

24 State, in consultation with the Secretary, shall es25 tablish an annual minimal level of savings in expendVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00545 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 itures for items and services covered under the Med2 icaid program under title XIX of the Social Security 

3 Act and the CHIP program under title XXI of such 

4 Act that must be reached by an accountable care or5 ganization in order for such organization to receive 

6 an incentive payment under subsection (d). 

7 (3) MINIMUM PARTICIPATION PERIOD.—A pro8 vider desiring to be recognized as an accountable 

9 care organization under the demonstration project 

10 shall enter into an agreement with the State to par11 ticipate in the project for not less than a 3-year pe12 riod. 

13 (d) INCENTIVE PAYMENT.—An accountable care or14 ganization that meets the performance guidelines estab15 lished by the Secretary under subsection (c)(1) and 

16 achieves savings greater than the annual minimal savings 

17 level established by the State under subsection (c)(2) shall 

18 receive an incentive payment for such year equal to a por19 tion (as determined appropriate by the Secretary) of the 

20 amount of such excess savings. The Secretary may estab21 lish an annual cap on incentive payments for an account22 able care organization. 

23 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

24 are authorized to be appropriated such sums as are nec25 essary to carry out this section. 


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1 SEC. 2707. MEDICAID EMERGENCY PSYCHIATRIC DEM2 ONSTRATION PROJECT. 

3 (a) AUTHORITY TO CONDUCT DEMONSTRATION

4 PROJECT.—The Secretary of Health and Human Services 

5 (in this section referred to as the ‘‘Secretary’’) shall estab6 lish a demonstration project under which an eligible State 

7 (as described in subsection (c)) shall provide payment 

8 under the State Medicaid plan under title XIX of the So9 cial Security Act to an institution for mental diseases that 

10 is not publicly owned or operated and that is subject to 

11 the requirements of section 1867 of the Social Security 

12 Act (42 U.S.C. 1395dd) for the provision of medical as13 sistance available under such plan to individuals who— 

14 (1) have attained age 21, but have not attained 

15 age 65; 

16 (2) are eligible for medical assistance under 

17 such plan; and 

18 (3) require such medical assistance to stabilize 

19 an emergency medical condition. 

20 (b) STABILIZATION REVIEW.—A State shall specify 

21 in its application described in subsection (c)(1) establish 

22 a mechanism for how it will ensure that institutions par23 ticipating in the demonstration will determine whether or 

24 not such individuals have been stabilized (as defined in 

25 subsection (h)(5)) . This mechanism shall commence be26 fore the third day of the inpatient stay. States particiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00547 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pating in the demonstration project may manage the pro2 vision of services for the stabilization of medical emer3 gency conditions through utilization review, authorization, 

4 or management practices, or the application of medical ne5 cessity and appropriateness criteria applicable to behav6 ioral health. 

7 (c) ELIGIBLE STATE DEFINED.— 

8 (1) IN GENERAL.—An eligible State is a State 

9 that has made an application and has been selected 

10 pursuant to paragraphs (2) and (3). 

11 (2) APPLICATION.—A State seeking to partici12 pate in the demonstration project under this section 

13 shall submit to the Secretary, at such time and in 

14 such format as the Secretary requires, an applica15 tion that includes such information, provisions, and 

16 assurances, as the Secretary may require. 

17 (3) SELECTION.—A State shall be determined 

18 eligible for the demonstration by the Secretary on a 

19 competitive basis among States with applications 

20 meeting the requirements of paragraph (1). In se21 lecting State applications for the demonstration 

22 project, the Secretary shall seek to achieve an appro23 priate national balance in the geographic distribu24 tion of such projects. 


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1 (d) LENGTH OF DEMONSTRATION PROJECT.—The 

2 demonstration project established under this section shall 

3 be conducted for a period of 3 consecutive years. 

4 (e) LIMITATIONS ON FEDERAL FUNDING.— 

5 (1) APPROPRIATION.— 

6 (A) IN GENERAL.—Out of any funds in the 

7 Treasury not otherwise appropriated, there is 

8 appropriated to carry out this section, 

9 $75,000,000 for fiscal year 2011. 

10 (B) BUDGET AUTHORITY.—Subparagraph 

11 (A) constitutes budget authority in advance of 

12 appropriations Act and represents the obliga13 tion of the Federal Government to provide for 

14 the payment of the amounts appropriated under 

15 that subparagraph. 

16 (2) 5-YEAR AVAILABILITY.—Funds appro17 priated under paragraph (1) shall remain available 

18 for obligation through December 31, 2015. 

19 (3) LIMITATION ON PAYMENTS.—In no case 

20 may— 

21 (A) the aggregate amount of payments 

22 made by the Secretary to eligible States under 

23 this section exceed $75,000,000; or 

24 (B) payments be provided by the Secretary 

25 under this section after December 31, 2015. 


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1 (4) FUNDS ALLOCATED TO STATES.—Funds 

2 shall be allocated to eligible States on the basis of 

3 criteria, including a State’s application and the 

4 availability of funds, as determined by the Secretary. 

5 (5) PAYMENTS TO STATES.—The Secretary 

6 shall pay to each eligible State, from its allocation 

7 under paragraph (4), an amount each quarter equal 

8 to the Federal medical assistance percentage of ex9 penditures in the quarter for medical assistance de10 scribed in subsection (a). As a condition of receiving 

11 payment, a State shall collect and report informa12 tion, as determined necessary by the Secretary, for 

13 the purposes of providing Federal oversight and con14 ducting an evaluation under subsection (f)(1). 

15 (f) EVALUATION AND REPORT TO CONGRESS.— 

16 (1) EVALUATION.—The Secretary shall conduct 

17 an evaluation of the demonstration project in order 

18 to determine the impact on the functioning of the 

19 health and mental health service system and on indi20 viduals enrolled in the Medicaid program and shall 

21 include the following: 

22 (A) An assessment of access to inpatient 

23 mental health services under the Medicaid pro24 gram; average lengths of inpatient stays; and 

25 emergency room visits. 


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1 (B) An assessment of discharge planning 

2 by participating hospitals. 

3 (C) An assessment of the impact of the 

4 demonstration project on the costs of the full 

5 range of mental health services (including inpa6 tient, emergency and ambulatory care). 

7 (D) An analysis of the percentage of con8 sumers with Medicaid coverage who are admit9 ted to inpatient facilities as a result of the dem10 onstration project as compared to those admit11 ted to these same facilities through other 

12 means. 

13 (E) A recommendation regarding whether 

14 the demonstration project should be continued 

15 after December 31, 2013, and expanded on a 

16 national basis. 

17 (2) REPORT.—Not later than December 31, 

18 2013, the Secretary shall submit to Congress and 

19 make available to the public a report on the findings 

20 of the evaluation under paragraph (1). 

21 (g) WAIVER AUTHORITY.— 

22 (1) IN GENERAL.—The Secretary shall waive 

23 the limitation of subdivision (B) following paragraph 

24 (28) of section 1905(a) of the Social Security Act 

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1 ments for care or services for individuals under 65 

2 years of age who are patients in an institution for 

3 mental diseases) for purposes of carrying out the 

4 demonstration project under this section. 

5 (2) LIMITED OTHER WAIVER AUTHORITY.—The 

6 Secretary may waive other requirements of titles XI 

7 and XIX of the Social Security Act (including the 

8 requirements of sections 1902(a)(1) (relating to 

9 statewideness) and 1902(1)(10)(B) (relating to com10 parability)) only to extent necessary to carry out the 

11 demonstration project under this section. 

12 (h) DEFINITIONS.—In this section: 

13 (1) EMERGENCY MEDICAL CONDITION.—The 

14 term ‘‘emergency medical condition’’ means, with re15 spect to an individual, an individual who expresses 

16 suicidal or homicidal thoughts or gestures, if deter17 mined dangerous to self or others. 

18 (2) FEDERAL MEDICAL ASSISTANCE PERCENT19 AGE.—The term ‘‘Federal medical assistance per20 centage’’ has the meaning given that term with re21 spect to a State under section 1905(b) of the Social 

22 Security Act (42 U.S.C. 1396d(b)). 

23 (3) INSTITUTION FOR MENTAL DISEASES.—The 

24 term ‘‘institution for mental diseases’’ has the meanVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00552 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ing given to that term in section 1905(i) of the So2 cial Security Act (42 U.S.C. 1396d(i)). 

3 (4) MEDICAL ASSISTANCE.—The term ‘‘medical 

4 assistance’’ has the meaning given that term in sec5 tion 1905(a) of the Social Security Act (42 U.S.C. 

6 1396d(a)). 

7 (5) STABILIZED.—The term ‘‘stabilized’’ 

8 means, with respect to an individual, that the emer9 gency medical condition no longer exists with respect 

10 to the individual and the individual is no longer dan11 gerous to self or others. 

12 (6) STATE.—The term ‘‘State’’ has the mean13 ing given that term for purposes of title XIX of the 

14 Social Security Act (42 U.S.C. 1396 et seq.). 

15 Subtitle J—Improvements to the 

16 Medicaid and CHIP Payment 

17 and Access Commission 

18 (MACPAC) 

19 SEC. 2801. MACPAC ASSESSMENT OF POLICIES AFFECTING 

20 ALL MEDICAID BENEFICIARIES. 

21 (a) IN GENERAL.—Section 1900 of the Social Secu22 rity Act (42 U.S.C. 1396) is amended— 

23 (1) in subsection (b)— 

24 (A) in paragraph (1)— 


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1 (i) in the paragraph heading, by in2 serting ‘‘FOR ALL STATES’’ before ‘‘AND

3 ANNUAL’’; and 

4 (ii) in subparagraph (A), by striking 

5 ‘‘children’s’’; 

6 (iii) in subparagraph (B), by inserting 

7 ‘‘, the Secretary, and States’’ after ‘‘Con8 gress’’; 

9 (iv) in subparagraph (C), by striking 

10 ‘‘March 1’’ and inserting ‘‘March 15’’; and 

11 (v) in subparagraph (D), by striking 

12 ‘‘June 1’’ and inserting ‘‘June 15’’; 

13 (B) in paragraph (2)— 

14 (i) in subparagraph (A)— 

15 (I) in clause (i)— 

16 (aa) by inserting ‘‘the effi17 cient provision of’’ after ‘‘expend18 itures for’’; and 

19 (bb) by striking ‘‘hospital, 

20 skilled nursing facility, physician, 

21 Federally-qualified health center, 

22 rural health center, and other 

23 fees’’ and inserting ‘‘payments to 

24 medical, dental, and health pro25 fessionals, hospitals, residential 


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1 and long-term care providers, 

2 providers of home and commu3 nity based services, Federally4 qualified health centers and rural 

5 health clinics, managed care enti6 ties, and providers of other cov7 ered items and services’’; and 

8 (II) in clause (iii), by inserting 

9 ‘‘(including how such factors and 

10 methodologies enable such bene11 ficiaries to obtain the services for 

12 which they are eligible, affect provider 

13 supply, and affect providers that serve 

14 a disproportionate share of low-income 

15 and other vulnerable populations)’’ 

16 after ‘‘beneficiaries’’; 

17 (ii) by redesignating subparagraphs 

18 (B) and (C) as subparagraphs (F) and 

19 (H), respectively; 

20 (iii) by inserting after subparagraph 

21 (A), the following: 

22 ‘‘(B) ELIGIBILITY POLICIES.—Medicaid 

23 and CHIP eligibility policies, including a deter24 mination of the degree to which Federal and 


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1 State policies provide health care coverage to 

2 needy populations. 

3 ‘‘(C) ENROLLMENT AND RETENTION PROC4 ESSES.—Medicaid and CHIP enrollment and 

5 retention processes, including a determination 

6 of the degree to which Federal and State poli7 cies encourage the enrollment of individuals 

8 who are eligible for such programs and screen 

9 out individuals who are ineligible, while mini10 mizing the share of program expenses devoted 

11 to such processes. 

12 ‘‘(D) COVERAGE POLICIES.—Medicaid and 

13 CHIP benefit and coverage policies, including a 

14 determination of the degree to which Federal 

15 and State policies provide access to the services 

16 enrollees require to improve and maintain their 

17 health and functional status. 

18 ‘‘(E) QUALITY OF CARE.—Medicaid and 

19 CHIP policies as they relate to the quality of 

20 care provided under those programs, including 

21 a determination of the degree to which Federal 

22 and State policies achieve their stated goals and 

23 interact with similar goals established by other 

24 purchasers of health care services.’’; 


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1 (iv) by inserting after subparagraph 

2 (F) (as redesignated by clause (ii) of this 

3 subparagraph), the following: 

4 ‘‘(G) INTERACTIONS WITH MEDICARE AND

5 MEDICAID.—Consistent with paragraph (11), 

6 the interaction of policies under Medicaid and 

7 the Medicare program under title XVIII, in8 cluding with respect to how such interactions 

9 affect access to services, payments, and dual el10 igible individuals.’’ and 

11 (v) in subparagraph (H) (as so redes12 ignated), by inserting ‘‘and preventive, 

13 acute, and long-term services and sup14 ports’’ after ‘‘barriers’’; 

15 (C) by redesignating paragraphs (3) 

16 through (9) as paragraphs (4) through (10), re17 spectively; 

18 (D) by inserting after paragraph (2), the 

19 following new paragraph: 

20 ‘‘(3) RECOMMENDATIONS AND REPORTS OF

21 STATE-SPECIFIC DATA.—MACPAC shall— 

22 ‘‘(A) review national and State-specific 

23 Medicaid and CHIP data; and 


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1 ‘‘(B) submit reports and recommendations 

2 to Congress, the Secretary, and States based on 

3 such reviews.’’; 

4 (E) in paragraph (4), as redesignated by 

5 subparagraph (C), by striking ‘‘or any other 

6 problems’’ and all that follows through the pe7 riod and inserting ‘‘, as well as other factors 

8 that adversely affect, or have the potential to 

9 adversely affect, access to care by, or the health 

10 care status of, Medicaid and CHIP bene11 ficiaries. MACPAC shall include in the annual 

12 report required under paragraph (1)(D) a de13 scription of all such areas or problems identi14 fied with respect to the period addressed in the 

15 report.’’; 

16 (F) in paragraph (5), as so redesig17 nated,— 

18 (i) in the paragraph heading, by in19 serting ‘‘AND REGULATIONS’’ after ‘‘RE20 PORTS’’; and 

21 (ii) by striking ‘‘If’’ and inserting the 

22 following: 

23 ‘‘(A) CERTAIN SECRETARIAL REPORTS.— 

24 If’’; and 


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1 (iii) in the second sentence, by insert2 ing ‘‘and the Secretary’’ after ‘‘appropriate 

3 committees of Congress’’; and 

4 (iv) by adding at the end the fol5 lowing: 

6 ‘‘(B) REGULATIONS.—MACPAC shall re7 view Medicaid and CHIP regulations and may 

8 comment through submission of a report to the 

9 appropriate committees of Congress and the 

10 Secretary, on any such regulations that affect 

11 access, quality, or efficiency of health care.’’; 

12 (G) in paragraph (10), as so redesignated, 

13 by inserting ‘‘, and shall submit with any rec14 ommendations, a report on the Federal and 

15 State-specific budget consequences of the rec16 ommendations’’ before the period; and 

17 (H) by adding at the end the following: 

18 ‘‘(11) CONSULTATION AND COORDINATION

19 WITH MEDPAC.— 

20 ‘‘(A) IN GENERAL.—MACPAC shall con21 sult with the Medicare Payment Advisory Com22 mission (in this paragraph referred to as 

23 ‘MedPAC’) established under section 1805 in 

24 carrying out its duties under this section, as ap25 propriate and particularly with respect to the 


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1 issues specified in paragraph (2) as they relate 

2 to those Medicaid beneficiaries who are dually 

3 eligible for Medicaid and the Medicare program 

4 under title XVIII, adult Medicaid beneficiaries 

5 (who are not dually eligible for Medicare), and 

6 beneficiaries under Medicare. Responsibility for 

7 analysis of and recommendations to change 

8 Medicare policy regarding Medicare bene9 ficiaries, including Medicare beneficiaries who 

10 are dually eligible for Medicare and Medicaid, 

11 shall rest with MedPAC. 

12 ‘‘(B) INFORMATION SHARING.—MACPAC 

13 and MedPAC shall have access to deliberations 

14 and records of the other such entity, respec15 tively, upon the request of the other such enti16 ty. 

17 ‘‘(12) CONSULTATION WITH STATES.— 

18 MACPAC shall regularly consult with States in car19 rying out its duties under this section, including 

20 with respect to developing processes for carrying out 

21 such duties, and shall ensure that input from States 

22 is taken into account and represented in MACPAC’s 

23 recommendations and reports. 

24 ‘‘(13) COORDINATE AND CONSULT WITH THE

25 FEDERAL COORDINATED HEALTH CARE OFFICE.— 


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1 MACPAC shall coordinate and consult with the Fed2 eral Coordinated Health Care Office established 

3 under section 2081 of the Patient Protection and 

4 Affordable Care Act before making any rec5 ommendations regarding dual eligible individuals. 

6 ‘‘(14) PROGRAMMATIC OVERSIGHT VESTED IN

7 THE SECRETARY.—MACPAC’s authority to make 

8 recommendations in accordance with this section 

9 shall not affect, or be considered to duplicate, the 

10 Secretary’s authority to carry out Federal respon11 sibilities with respect to Medicaid and CHIP.’’; 

12 (2) in subsection (c)(2)— 

13 (A) by striking subparagraphs (A) and (B) 

14 and inserting the following: 

15 ‘‘(A) IN GENERAL.—The membership of 

16 MACPAC shall include individuals who have 

17 had direct experience as enrollees or parents or 

18 caregivers of enrollees in Medicaid or CHIP and 

19 individuals with national recognition for their 

20 expertise in Federal safety net health programs, 

21 health finance and economics, actuarial science, 

22 health plans and integrated delivery systems, 

23 reimbursement for health care, health informa24 tion technology, and other providers of health 

25 services, public health, and other related fields, 


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1 who provide a mix of different professions, 

2 broad geographic representation, and a balance 

3 between urban and rural representation. 

4 ‘‘(B) INCLUSION.—The membership of 

5 MACPAC shall include (but not be limited to) 

6 physicians, dentists, and other health profes7 sionals, employers, third-party payers, and indi8 viduals with expertise in the delivery of health 

9 services. Such membership shall also include 

10 representatives of children, pregnant women, 

11 the elderly, individuals with disabilities, care12 givers, and dual eligible individuals, current or 

13 former representatives of State agencies respon14 sible for administering Medicaid, and current or 

15 former representatives of State agencies respon16 sible for administering CHIP.’’. 

17 (3) in subsection (d)(2), by inserting ‘‘and 

18 State’’ after ‘‘Federal’’; 

19 (4) in subsection (e)(1), in the first sentence, by 

20 inserting ‘‘and, as a condition for receiving payments 

21 under sections 1903(a) and 2105(a), from any State 

22 agency responsible for administering Medicaid or 

23 CHIP,’’ after ‘‘United States’’; and 

24 (5) in subsection (f)— 


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1 (A) in the subsection heading, by striking 

2 ‘‘AUTHORIZATION OF APPROPRIATIONS’’ and 

3 inserting ‘‘FUNDING’’; 

4 (B) in paragraph (1), by inserting ‘‘(other 

5 than for fiscal year 2010)’’ before ‘‘in the same 

6 manner’’; and 

7 (C) by adding at the end the following: 

8 ‘‘(3) FUNDING FOR FISCAL YEAR 2010.— 

9 ‘‘(A) IN GENERAL.—Out of any funds in 

10 the Treasury not otherwise appropriated, there 

11 is appropriated to MACPAC to carry out the 

12 provisions of this section for fiscal year 2010, 

13 $9,000,000. 

14 ‘‘(B) TRANSFER OF FUNDS.—Notwith15 standing section 2104(a)(13), from the 

16 amounts appropriated in such section for fiscal 

17 year 2010, $2,000,000 is hereby transferred 

18 and made available in such fiscal year to 

19 MACPAC to carry out the provisions of this 

20 section. 

21 ‘‘(4) AVAILABILITY.—Amounts made available 

22 under paragraphs (2) and (3) to MACPAC to carry 

23 out the provisions of this section shall remain avail24 able until expended.’’. 


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1 (b) CONFORMING MEDPAC AMENDMENTS.—Section 

2 1805(b) of the Social Security Act (42 U.S.C. 1395b– 

3 6(b)), is amended— 

4 (1) in paragraph (1)(C), by striking ‘‘March 1 

5 of each year (beginning with 1998)’’ and inserting 

6 ‘‘March 15’’; 

7 (2) in paragraph (1)(D), by inserting ‘‘, and 

8 (beginning with 2012) containing an examination of 

9 the topics described in paragraph (9), to the extent 

10 feasible’’ before the period; and 

11 (3) by adding at the end the following: 

12 ‘‘(9) REVIEW AND ANNUAL REPORT ON MED13 ICAID AND COMMERCIAL TRENDS.—The Commission 

14 shall review and report on aggregate trends in 

15 spending, utilization, and financial performance 

16 under the Medicaid program under title XIX and 

17 the private market for health care services with re18 spect to providers for which, on an aggregate na19 tional basis, a significant portion of revenue or serv20 ices is associated with the Medicaid program. Where 

21 appropriate, the Commission shall conduct such re22 view in consultation with the Medicaid and CHIP 

23 Payment and Access Commission established under 

24 section 1900 (in this section referred to as 

25 ‘MACPAC’). 


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1 ‘‘(10) COORDINATE AND CONSULT WITH THE

2 FEDERAL COORDINATED HEALTH CARE OFFICE.— 

3 The Commission shall coordinate and consult with 

4 the Federal Coordinated Health Care Office estab5 lished under section 2081 of the Patient Protection 

6 and Affordable Care Act before making any rec7 ommendations regarding dual eligible individuals. 

8 ‘‘(11) INTERACTION OF MEDICAID AND MEDI9 CARE.—The Commission shall consult with 

10 MACPAC in carrying out its duties under this sec11 tion, as appropriate. Responsibility for analysis of 

12 and recommendations to change Medicare policy re13 garding Medicare beneficiaries, including Medicare 

14 beneficiaries who are dually eligible for Medicare and 

15 Medicaid, shall rest with the Commission. Responsi16 bility for analysis of and recommendations to change 

17 Medicaid policy regarding Medicaid beneficiaries, in18 cluding Medicaid beneficiaries who are dually eligible 

19 for Medicare and Medicaid, shall rest with 

20 MACPAC.’’. 

21 Subtitle K—Protections for Amer22 ican Indians and Alaska Natives 

23 SEC. 2901. SPECIAL RULES RELATING TO INDIANS. 

24 (a) NO COST-SHARING FOR INDIANS WITH INCOME

25 AT OR BELOW 300 PERCENT OF POVERTY ENROLLED IN


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1 COVERAGE THROUGH A STATE EXCHANGE.—For provi2 sions prohibiting cost sharing for Indians enrolled in any 

3 qualified health plan in the individual market through an 

4 Exchange, see section 1402(d) of the Patient Protection 

5 and Affordable Care Act. 

6 (b) PAYER OF LAST RESORT.—Health programs op7 erated by the Indian Health Service, Indian tribes, tribal 

8 organizations, and Urban Indian organizations (as those 

9 terms are defined in section 4 of the Indian Health Care 

10 Improvement Act (25 U.S.C. 1603)) shall be the payer 

11 of last resort for services provided by such Service, tribes, 

12 or organizations to individuals eligible for services through 

13 such programs, notwithstanding any Federal, State, or 

14 local law to the contrary. 

15 (c) FACILITATING ENROLLMENT OF INDIANS UNDER

16 THE EXPRESS LANE OPTION.—Section 

17 1902(e)(13)(F)(ii) of the Social Security Act (42 U.S.C. 

18 1396a(e)(13)(F)(ii)) is amended— 

19 (1) in the clause heading, by inserting ‘‘AND IN20 DIAN TRIBES AND TRIBAL ORGANIZATIONS’’ after 

21 ‘‘AGENCIES’’; and 

22 (2) by adding at the end the following: 

23 ‘‘(IV) The Indian Health Service, 

24 an Indian Tribe, Tribal Organization, 


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1 or Urban Indian Organization (as de2 fined in section 1139(c)).’’. 

3 (d) TECHNICAL CORRECTIONS.—Section 1139(c) of 

4 the Social Security Act (42 U.S.C. 1320b–9(c)) is amend5 ed by striking ‘‘In this section’’ and inserting ‘‘For pur6 poses of this section, title XIX, and title XXI’’. 

7 SEC. 2902. ELIMINATION OF SUNSET FOR REIMBURSEMENT 

8 FOR ALL MEDICARE PART B SERVICES FUR9 NISHED BY CERTAIN INDIAN HOSPITALS AND 

10 CLINICS. 

11 (a) REIMBURSEMENT FOR ALL MEDICARE PART B 

12 SERVICES FURNISHED BY CERTAIN INDIAN HOSPITALS

13 AND CLINICS.—Section 1880(e)(1)(A) of the Social Secu14 rity Act (42 U.S.C. 1395qq(e)(1)(A)) is amended by strik15 ing ‘‘during the 5-year period beginning on’’ and inserting 

16 ‘‘on or after’’. 

17 (b) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to items or services furnished on 

19 or after January 1, 2010. 


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1 Subtitle L—Maternal and Child 

2 Health Services 

3 SEC. 2951. MATERNAL, INFANT, AND EARLY CHILDHOOD 

4 HOME VISITING PROGRAMS. 

5 Title V of the Social Security Act (42 U.S.C. 701 

6 et seq.) is amended by adding at the end the following 

7 new section: 

8 ‘‘SEC. 511. MATERNAL, INFANT, AND EARLY CHILDHOOD 

9 HOME VISITING PROGRAMS. 

10 ‘‘(a) PURPOSES.—The purposes of this section are— 

11 ‘‘(1) to strengthen and improve the programs 

12 and activities carried out under this title; 

13 ‘‘(2) to improve coordination of services for at 

14 risk communities; and 

15 ‘‘(3) to identify and provide comprehensive 

16 services to improve outcomes for families who reside 

17 in at risk communities. 

18 ‘‘(b) REQUIREMENT FOR ALL STATES TO ASSESS

19 STATEWIDE NEEDS AND IDENTIFY AT RISK COMMU20 NITIES.— 

21 ‘‘(1) IN GENERAL.—Not later than 6 months 

22 after the date of enactment of this section, each 

23 State shall, as a condition of receiving payments 

24 from an allotment for the State under section 502 

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1 sessment (which shall be separate from the statewide 

2 needs assessment required under section 505(a)) 

3 that identifies— 

4 ‘‘(A) communities with concentrations of— 

5 ‘‘(i) premature birth, low-birth weight 

6 infants, and infant mortality, including in7 fant death due to neglect, or other indica8 tors of at-risk prenatal, maternal, newborn, 

9 or child health; 

10 ‘‘(ii) poverty; 

11 ‘‘(iii) crime; 

12 ‘‘(iv) domestic violence; 

13 ‘‘(v) high rates of high-school drop14 outs; 

15 ‘‘(vi) substance abuse; 

16 ‘‘(vii) unemployment; or 

17 ‘‘(viii) child maltreatment; 

18 ‘‘(B) the quality and capacity of existing 

19 programs or initiatives for early childhood home 

20 visitation in the State including— 

21 ‘‘(i) the number and types of individ22 uals and families who are receiving services 

23 under such programs or initiatives; 

24 ‘‘(ii) the gaps in early childhood home 

25 visitation in the State; and 


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1 ‘‘(iii) the extent to which such pro2 grams or initiatives are meeting the needs 

3 of eligible families described in subsection 

4 (k)(2); and 

5 ‘‘(C) the State’s capacity for providing 

6 substance abuse treatment and counseling serv7 ices to individuals and families in need of such 

8 treatment or services. 

9 ‘‘(2) COORDINATION WITH OTHER ASSESS10 MENTS.—In conducting the statewide needs assess11 ment required under paragraph (1), the State shall 

12 coordinate with, and take into account, other appro13 priate needs assessments conducted by the State, as 

14 determined by the Secretary, including the needs as15 sessment required under section 505(a) (both the 

16 most recently completed assessment and any such 

17 assessment in progress), the communitywide stra18 tegic planning and needs assessments conducted in 

19 accordance with section 640(g)(1)(C) of the Head 

20 Start Act, and the inventory of current unmet needs 

21 and current community-based and prevention-fo22 cused programs and activities to prevent child abuse 

23 and neglect, and other family resource services oper24 ating in the State required under section 205(3) of 

25 the Child Abuse Prevention and Treatment Act. 


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1 ‘‘(3) SUBMISSION TO THE SECRETARY.—Each 

2 State shall submit to the Secretary, in such form 

3 and manner as the Secretary shall require— 

4 ‘‘(A) the results of the statewide needs as5 sessment required under paragraph (1); and 

6 ‘‘(B) a description of how the State in7 tends to address needs identified by the assess8 ment, particularly with respect to communities 

9 identified under paragraph (1)(A), which may 

10 include applying for a grant to conduct an early 

11 childhood home visitation program in accord12 ance with the requirements of this section. 

13 ‘‘(c) GRANTS FOR EARLY CHILDHOOD HOME VISITA14 TION PROGRAMS.— 

15 ‘‘(1) AUTHORITY TO MAKE GRANTS.—In addi16 tion to any other payments made under this title to 

17 a State, the Secretary shall make grants to eligible 

18 entities to enable the entities to deliver services 

19 under early childhood home visitation programs that 

20 satisfy the requirements of subsection (d) to eligible 

21 families in order to promote improvements in mater22 nal and prenatal health, infant health, child health 

23 and development, parenting related to child develop24 ment outcomes, school readiness, and the socioVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00571 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 economic status of such families, and reductions in 

2 child abuse, neglect, and injuries. 

3 ‘‘(2) AUTHORITY TO USE INITIAL GRANT FUNDS

4 FOR PLANNING OR IMPLEMENTATION.—An eligible 

5 entity that receives a grant under paragraph (1) 

6 may use a portion of the funds made available to the 

7 entity during the first 6 months of the period for 

8 which the grant is made for planning or implementa9 tion activities to assist with the establishment of 

10 early childhood home visitation programs that sat11 isfy the requirements of subsection (d). 

12 ‘‘(3) GRANT DURATION.—The Secretary shall 

13 determine the period of years for which a grant is 

14 made to an eligible entity under paragraph (1). 

15 ‘‘(4) TECHNICAL ASSISTANCE.—The Secretary 

16 shall provide an eligible entity that receives a grant 

17 under paragraph (1) with technical assistance in ad18 ministering programs or activities conducted in 

19 whole or in part with grant funds. 

20 ‘‘(d) REQUIREMENTS.—The requirements of this sub21 section for an early childhood home visitation program 

22 conducted with a grant made under this section are as 

23 follows: 

24 ‘‘(1) QUANTIFIABLE, MEASURABLE IMPROVE25 MENT IN BENCHMARK AREAS.— 


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1 ‘‘(A) IN GENERAL.—The eligible entity es2 tablishes, subject to the approval of the Sec3 retary, quantifiable, measurable 3- and 5-year 

4 benchmarks for demonstrating that the pro5 gram results in improvements for the eligible 

6 families participating in the program in each of 

7 the following areas: 

8 ‘‘(i) Improved maternal and newborn 

9 health. 

10 ‘‘(ii) Prevention of child injuries, child 

11 abuse, neglect, or maltreatment, and re12 duction of emergency department visits. 

13 ‘‘(iii) Improvement in school readiness 

14 and achievement. 

15 ‘‘(iv) Reduction in crime or domestic 

16 violence. 

17 ‘‘(v) Improvements in family economic 

18 self-sufficiency. 

19 ‘‘(vi) Improvements in the coordina20 tion and referrals for other community re21 sources and supports. 

22 ‘‘(B) DEMONSTRATION OF IMPROVEMENTS

23 AFTER 3 YEARS.— 

24 ‘‘(i) REPORT TO THE SECRETARY.— 

25 Not later than 30 days after the end of the 


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1 3rd year in which the eligible entity con2 ducts the program, the entity submits to 

3 the Secretary a report demonstrating im4 provement in at least 4 of the areas speci5 fied in subparagraph (A). 

6 ‘‘(ii) CORRECTIVE ACTION PLAN.—If 

7 the report submitted by the eligible entity 

8 under clause (i) fails to demonstrate im9 provement in at least 4 of the areas speci10 fied in subparagraph (A), the entity shall 

11 develop and implement a plan to improve 

12 outcomes in each of the areas specified in 

13 subparagraph (A), subject to approval by 

14 the Secretary. The plan shall include provi15 sions for the Secretary to monitor imple16 mentation of the plan and conduct contin17 ued oversight of the program, including 

18 through submission by the entity of reg19 ular reports to the Secretary. 

20 ‘‘(iii) TECHNICAL ASSISTANCE.— 

21 ‘‘(I) IN GENERAL.—The Sec22 retary shall provide an eligible entity 

23 required to develop and implement an 

24 improvement plan under clause (ii) 

25 with technical assistance to develop 


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1 and implement the plan. The Sec2 retary may provide the technical as3 sistance directly or through grants, 

4 contracts, or cooperative agreements. 

5 ‘‘(II) ADVISORY PANEL.—The 

6 Secretary shall establish an advisory 

7 panel for purposes of obtaining rec8 ommendations regarding the technical 

9 assistance provided to entities in ac10 cordance with subclause (I). 

11 ‘‘(iv) NO IMPROVEMENT OR FAILURE

12 TO SUBMIT REPORT.—If the Secretary de13 termines after a period of time specified by 

14 the Secretary that an eligible entity imple15 menting an improvement plan under clause 

16 (ii) has failed to demonstrate any improve17 ment in the areas specified in subpara18 graph (A), or if the Secretary determines 

19 that an eligible entity has failed to submit 

20 the report required under clause (i), the 

21 Secretary shall terminate the entity’s grant 

22 and may include any unexpended grant 

23 funds in grants made to nonprofit organi24 zations under subsection (h)(2)(B). 


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1 ‘‘(C) FINAL REPORT.—Not later than De2 cember 31, 2015, the eligible entity shall sub3 mit a report to the Secretary demonstrating im4 provements (if any) in each of the areas speci5 fied in subparagraph (A). 

6 ‘‘(2) IMPROVEMENTS IN OUTCOMES FOR INDI7 VIDUAL FAMILIES.— 

8 ‘‘(A) IN GENERAL.—The program is de9 signed, with respect to an eligible family partici10 pating in the program, to result in the partici11 pant outcomes described in subparagraph (B) 

12 that the eligible entity identifies on the basis of 

13 an individualized assessment of the family, are 

14 relevant for that family. 

15 ‘‘(B) PARTICIPANT OUTCOMES.—The par16 ticipant outcomes described in this subpara17 graph are the following: 

18 ‘‘(i) Improvements in prenatal, mater19 nal, and newborn health, including im20 proved pregnancy outcomes 

21 ‘‘(ii) Improvements in child health 

22 and development, including the prevention 

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1 emotional, and physical developmental indi2 cators. 

3 ‘‘(iii) Improvements in parenting 

4 skills. 

5 ‘‘(iv) Improvements in school readi6 ness and child academic achievement. 

7 ‘‘(v) Reductions in crime or domestic 

8 violence. 

9 ‘‘(vi) Improvements in family eco10 nomic self-sufficiency. 

11 ‘‘(vii) Improvements in the coordina12 tion of referrals for, and the provision of, 

13 other community resources and supports 

14 for eligible families, consistent with State 

15 child welfare agency training. 

16 ‘‘(3) CORE COMPONENTS.—The program in17 cludes the following core components: 

18 ‘‘(A) SERVICE DELIVERY MODEL OR MOD19 ELS.— 

20 ‘‘(i) IN GENERAL.—Subject to clause 

21 (ii), the program is conducted using 1 or 

22 more of the service delivery models de23 scribed in item (aa) or (bb) of subclause 

24 (I) or in subclause (II) selected by the eli25 gible entity: 


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1 ‘‘(I) The model conforms to a 

2 clear consistent home visitation model 

3 that has been in existence for at least 

4 3 years and is research-based, ground5 ed in relevant empirically-based 

6 knowledge, linked to program deter7 mined outcomes, associated with a na8 tional organization or institution of 

9 higher education that has comprehen10 sive home visitation program stand11 ards that ensure high quality service 

12 delivery and continuous program qual13 ity improvement, and has dem14 onstrated significant, (and in the case 

15 of the service delivery model described 

16 in item (aa), sustained) positive out17 comes, as described in the benchmark 

18 areas specified in paragraph (1)(A) 

19 and the participant outcomes de20 scribed in paragraph (2)(B), when 

21 evaluated using well-designed and rig22 orous— 

23 ‘‘(aa) randomized controlled 

24 research designs, and the evaluaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00578 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tion results have been published 

2 in a peer-reviewed journal; or 

3 ‘‘(bb) quasi-experimental re4 search designs. 

5 ‘‘(II) The model conforms to a 

6 promising and new approach to 

7 achieving the benchmark areas speci8 fied in paragraph (1)(A) and the par9 ticipant outcomes described in para10 graph (2)(B), has been developed or 

11 identified by a national organization 

12 or institution of higher education, and 

13 will be evaluated through well-de14 signed and rigorous process. 

15 ‘‘(ii) MAJORITY OF GRANT FUNDS

16 USED FOR EVIDENCE-BASED MODELS.—An 

17 eligible entity shall use not more than 25 

18 percent of the amount of the grant paid to 

19 the entity for a fiscal year for purposes of 

20 conducting a program using the service de21 livery model described in clause (i)(II). 

22 ‘‘(iii) CRITERIA FOR EVIDENCE OF EF23 FECTIVENESS OF MODELS.—The Secretary 

24 shall establish criteria for evidence of effec25 tiveness of the service delivery models and 


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1 shall ensure that the process for estab2 lishing the criteria is transparent and pro3 vides the opportunity for public comment. 

4 ‘‘(B) ADDITIONAL REQUIREMENTS.— 

5 ‘‘(i) The program adheres to a clear, 

6 consistent model that satisfies the require7 ments of being grounded in empirically8 based knowledge related to home visiting 

9 and linked to the benchmark areas speci10 fied in paragraph (1)(A) and the partici11 pant outcomes described in paragraph 

12 (2)(B) related to the purposes of the pro13 gram. 

14 ‘‘(ii) The program employs well15 trained and competent staff, as dem16 onstrated by education or training, such as 

17 nurses, social workers, educators, child de18 velopment specialists, or other well-trained 

19 and competent staff, and provides ongoing 

20 and specific training on the model being 

21 delivered. 

22 ‘‘(iii) The program maintains high 

23 quality supervision to establish home vis24 itor competencies. 


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1 ‘‘(iv) The program demonstrates 

2 strong organizational capacity to imple3 ment the activities involved. 

4 ‘‘(v) The program establishes appro5 priate linkages and referral networks to 

6 other community resources and supports 

7 for eligible families. 

8 ‘‘(vi) The program monitors the fidel9 ity of program implementation to ensure 

10 that services are delivered pursuant to the 

11 specified model. 

12 ‘‘(4) PRIORITY FOR SERVING HIGH-RISK POPU13 LATIONS.—The eligible entity gives priority to pro14 viding services under the program to the following: 

15 ‘‘(A) Eligible families who reside in com16 munities in need of such services, as identified 

17 in the statewide needs assessment required 

18 under subsection (b)(1)(A). 

19 ‘‘(B) Low-income eligible families. 

20 ‘‘(C) Eligible families who are pregnant 

21 women who have not attained age 21. 

22 ‘‘(D) Eligible families that have a history 

23 of child abuse or neglect or have had inter24 actions with child welfare services. 


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1 ‘‘(E) Eligible families that have a history 

2 of substance abuse or need substance abuse 

3 treatment. 

4 ‘‘(F) Eligible families that have users of 

5 tobacco products in the home. 

6 ‘‘(G) Eligible families that are or have chil7 dren with low student achievement. 

8 ‘‘(H) Eligible families with children with 

9 developmental delays or disabilities. 

10 ‘‘(I) Eligible families who, or that include 

11 individuals who, are serving or formerly served 

12 in the Armed Forces, including such families 

13 that have members of the Armed Forces who 

14 have had multiple deployments outside of the 

15 United States. 

16 ‘‘(e) APPLICATION REQUIREMENTS.—An eligible en17 tity desiring a grant under this section shall submit an 

18 application to the Secretary for approval, in such manner 

19 as the Secretary may require, that includes the following: 

20 ‘‘(1) A description of the populations to be 

21 served by the entity, including specific information 

22 regarding how the entity will serve high risk popu23 lations described in subsection (d)(4). 

24 ‘‘(2) An assurance that the entity will give pri25 ority to serving low-income eligible families and eligiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00582 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ble families who reside in at risk communities identi2 fied in the statewide needs assessment required 

3 under subsection (b)(1)(A). 

4 ‘‘(3) The service delivery model or models de5 scribed in subsection (d)(3)(A) that the entity will 

6 use under the program and the basis for the selec7 tion of the model or models. 

8 ‘‘(4) A statement identifying how the selection 

9 of the populations to be served and the service deliv10 ery model or models that the entity will use under 

11 the program for such populations is consistent with 

12 the results of the statewide needs assessment con13 ducted under subsection (b). 

14 ‘‘(5) The quantifiable, measurable benchmarks 

15 established by the State to demonstrate that the 

16 program contributes to improvements in the areas 

17 specified in subsection (d)(1)(A). 

18 ‘‘(6) An assurance that the entity will obtain 

19 and submit documentation or other appropriate evi20 dence from the organization or entity that developed 

21 the service delivery model or models used under the 

22 program to verify that the program is implemented 

23 and services are delivered according to the model 

24 specifications. 


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1 ‘‘(7) Assurances that the entity will establish 

2 procedures to ensure that— 

3 ‘‘(A) the participation of each eligible fam4 ily in the program is voluntary; and 

5 ‘‘(B) services are provided to an eligible 

6 family in accordance with the individual assess7 ment for that family. 

8 ‘‘(8) Assurances that the entity will— 

9 ‘‘(A) submit annual reports to the Sec10 retary regarding the program and activities car11 ried out under the program that include such 

12 information and data as the Secretary shall re13 quire; and 

14 ‘‘(B) participate in, and cooperate with, 

15 data and information collection necessary for 

16 the evaluation required under subsection (g)(2) 

17 and other research and evaluation activities car18 ried out under subsection (h)(3). 

19 ‘‘(9) A description of other State programs that 

20 include home visitation services, including, if appli21 cable to the State, other programs carried out under 

22 this title with funds made available from allotments 

23 under section 502(c), programs funded under title 

24 IV, title II of the Child Abuse Prevention and Treat25 ment Act (relating to community-based grants for 


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1 the prevention of child abuse and neglect), and sec2 tion 645A of the Head Start Act (relating to Early 

3 Head Start programs). 

4 ‘‘(10) Other information as required by the Sec5 retary. 

6 ‘‘(f) MAINTENANCE OF EFFORT.—Funds provided to 

7 an eligible entity receiving a grant under this section shall 

8 supplement, and not supplant, funds from other sources 

9 for early childhood home visitation programs or initiatives. 

10 ‘‘(g) EVALUATION.— 

11 ‘‘(1) INDEPENDENT, EXPERT ADVISORY

12 PANEL.—The Secretary, in accordance with sub13 section (h)(1)(A), shall appoint an independent advi14 sory panel consisting of experts in program evalua15 tion and research, education, and early childhood de16 velopment— 

17 ‘‘(A) to review, and make recommendations 

18 on, the design and plan for the evaluation re19 quired under paragraph (2) within 1 year after 

20 the date of enactment of this section; 

21 ‘‘(B) to maintain and advise the Secretary 

22 regarding the progress of the evaluation; and 

23 ‘‘(C) to comment, if the panel so desires, 

24 on the report submitted under paragraph (3). 


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1 ‘‘(2) AUTHORITY TO CONDUCT EVALUATION.— 

2 On the basis of the recommendations of the advisory 

3 panel under paragraph (1), the Secretary shall, by 

4 grant, contract, or interagency agreement, conduct 

5 an evaluation of the statewide needs assessments 

6 submitted under subsection (b) and the grants made 

7 under subsections (c) and (h)(3)(B). The evaluation 

8 shall include— 

9 ‘‘(A) an analysis, on a State-by-State 

10 basis, of the results of such assessments, in11 cluding indicators of maternal and prenatal 

12 health and infant health and mortality, and 

13 State actions in response to the assessments; 

14 and 

15 ‘‘(B) an assessment of— 

16 ‘‘(i) the effect of early childhood home 

17 visitation programs on child and parent 

18 outcomes, including with respect to each of 

19 the benchmark areas specified in sub20 section (d)(1)(A) and the participant out21 comes described in subsection (d)(2)(B); 

22 ‘‘(ii) the effectiveness of such pro23 grams on different populations, including 

24 the extent to which the ability of programs 


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1 to improve participant outcomes varies 

2 across programs and populations; and 

3 ‘‘(iii) the potential for the activities 

4 conducted under such programs, if scaled 

5 broadly, to improve health care practices, 

6 eliminate health disparities, and improve 

7 health care system quality, efficiencies, and 

8 reduce costs. 

9 ‘‘(3) REPORT.—Not later than March 31, 2015, 

10 the Secretary shall submit a report to Congress on 

11 the results of the evaluation conducted under para12 graph (2) and shall make the report publicly avail13 able. 

14 ‘‘(h) OTHER PROVISIONS.— 

15 ‘‘(1) INTRA-AGENCY COLLABORATION.—The 

16 Secretary shall ensure that the Maternal and Child 

17 Health Bureau and the Administration for Children 

18 and Families collaborate with respect to carrying out 

19 this section, including with respect to— 

20 ‘‘(A) reviewing and analyzing the statewide 

21 needs assessments required under subsection 

22 (b), the awarding and oversight of grants 

23 awarded under this section, the establishment 

24 of the advisory panels required under sub25 sections (d)(1)(B)(iii)(II) and (g)(1), and the 


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1 evaluation and report required under subsection 

2 (g); and 

3 ‘‘(B) consulting with other Federal agen4 cies with responsibility for administering or 

5 evaluating programs that serve eligible families 

6 to coordinate and collaborate with respect to re7 search related to such programs and families, 

8 including the Office of the Assistant Secretary 

9 for Planning and Evaluation of the Department 

10 of Health and Human Services, the Centers for 

11 Disease Control and Prevention, the National 

12 Institute of Child Health and Human Develop13 ment of the National Institutes of Health, the 

14 Office of Juvenile Justice and Delinquency Pre15 vention of the Department of Justice, and the 

16 Institute of Education Sciences of the Depart17 ment of Education. 

18 ‘‘(2) GRANTS TO ELIGIBLE ENTITIES THAT ARE

19 NOT STATES.— 

20 ‘‘(A) INDIAN TRIBES, TRIBAL ORGANIZA21 TIONS, OR URBAN INDIAN ORGANIZATIONS.— 

22 The Secretary shall specify requirements for eli23 gible entities that are Indian Tribes (or a con24 sortium of Indian Tribes), Tribal Organiza25 tions, or Urban Indian Organizations to apply 


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1 for and conduct an early childhood home visita2 tion program with a grant under this section. 

3 Such requirements shall, to the greatest extent 

4 practicable, be consistent with the requirements 

5 applicable to eligible entities that are States 

6 and shall require an Indian Tribe (or consor7 tium), Tribal Organization, or Urban Indian 

8 Organization to— 

9 ‘‘(i) conduct a needs assessment simi10 lar to the assessment required for all 

11 States under subsection (b); and 

12 ‘‘(ii) establish quantifiable, measur13 able 3- and 5-year benchmarks consistent 

14 with subsection (d)(1)(A). 

15 ‘‘(B) NONPROFIT ORGANIZATIONS.—If, as 

16 of the beginning of fiscal year 2012, a State 

17 has not applied or been approved for a grant 

18 under this section, the Secretary may use 

19 amounts appropriated under paragraph (1) of 

20 subsection (j) that are available for expenditure 

21 under paragraph (3) of that subsection to make 

22 a grant to an eligible entity that is a nonprofit 

23 organization described in subsection (k)(1)(B) 

24 to conduct an early childhood home visitation 

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1 fy the requirements for such an organization to 

2 apply for and conduct the program which shall, 

3 to the greatest extent practicable, be consistent 

4 with the requirements applicable to eligible enti5 ties that are States and shall require the orga6 nization to— 

7 ‘‘(i) carry out the program based on 

8 the needs assessment conducted by the 

9 State under subsection (b); and 

10 ‘‘(ii) establish quantifiable, measur11 able 3- and 5-year benchmarks consistent 

12 with subsection (d)(1)(A). 

13 ‘‘(3) RESEARCH AND OTHER EVALUATION AC14 TIVITIES.— 

15 ‘‘(A) IN GENERAL.—The Secretary shall 

16 carry out a continuous program of research and 

17 evaluation activities in order to increase knowl18 edge about the implementation and effective19 ness of home visiting programs, using random 

20 assignment designs to the maximum extent fea21 sible. The Secretary may carry out such activi22 ties directly, or through grants, cooperative 

23 agreements, or contracts. 

24 ‘‘(B) REQUIREMENTS.—The Secretary 

25 shall ensure that— 


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1 ‘‘(i) evaluation of a specific program 

2 or project is conducted by persons or indi3 viduals not directly involved in the oper4 ation of such program or project; and 

5 ‘‘(ii) the conduct of research and eval6 uation activities includes consultation with 

7 independent researchers, State officials, 

8 and developers and providers of home vis9 iting programs on topics including research 

10 design and administrative data matching. 

11 ‘‘(4) REPORT AND RECOMMENDATION.—Not 

12 later than December 31, 2015, the Secretary shall 

13 submit a report to Congress regarding the programs 

14 conducted with grants under this section. The report 

15 required under this paragraph shall include— 

16 ‘‘(A) information regarding the extent to 

17 which eligible entities receiving grants under 

18 this section demonstrated improvements in each 

19 of the areas specified in subsection (d)(1)(A); 

20 ‘‘(B) information regarding any technical 

21 assistance provided under subsection 

22 (d)(1)(B)(iii)(I), including the type of any such 

23 assistance provided; and 


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1 ‘‘(C) recommendations for such legislative 

2 or administrative action as the Secretary deter3 mines appropriate. 

4 ‘‘(i) APPLICATION OF OTHER PROVISIONS OF

5 TITLE.— 

6 ‘‘(1) IN GENERAL.—Except as provided in para7 graph (2), the other provisions of this title shall not 

8 apply to a grant made under this section. 

9 ‘‘(2) EXCEPTIONS.—The following provisions of 

10 this title shall apply to a grant made under this sec11 tion to the same extent and in the same manner as 

12 such provisions apply to allotments made under sec13 tion 502(c): 

14 ‘‘(A) Section 504(b)(6) (relating to prohi15 bition on payments to excluded individuals and 

16 entities). 

17 ‘‘(B) Section 504(c) (relating to the use of 

18 funds for the purchase of technical assistance). 

19 ‘‘(C) Section 504(d) (relating to a limita20 tion on administrative expenditures). 

21 ‘‘(D) Section 506 (relating to reports and 

22 audits), but only to the extent determined by 

23 the Secretary to be appropriate for grants made 

24 under this section. 


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1 ‘‘(E) Section 507 (relating to penalties for 

2 false statements). 

3 ‘‘(F) Section 508 (relating to non4 discrimination). 

5 ‘‘(G) Section 509(a) (relating to the ad6 ministration of the grant program). 

7 ‘‘(j) APPROPRIATIONS.— 

8 ‘‘(1) IN GENERAL.—Out of any funds in the 

9 Treasury not otherwise appropriated, there are ap10 propriated to the Secretary to carry out this sec11 tion— 

12 ‘‘(A) $100,000,000 for fiscal year 2010; 

13 ‘‘(B) $250,000,000 for fiscal year 2011; 

14 ‘‘(C) $350,000,000 for fiscal year 2012; 

15 ‘‘(D) $400,000,000 for fiscal year 2013; 

16 and 

17 ‘‘(E) $400,000,000 for fiscal year 2014. 

18 ‘‘(2) RESERVATIONS.—Of the amount appro19 priated under this subsection for a fiscal year, the 

20 Secretary shall reserve— 

21 ‘‘(A) 3 percent of such amount for pur22 poses of making grants to eligible entities that 

23 are Indian Tribes (or a consortium of Indian 

24 Tribes), Tribal Organizations, or Urban Indian 

25 Organizations; and 


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1 ‘‘(B) 3 percent of such amount for pur2 poses of carrying out subsections (d)(1)(B)(iii), 

3 (g), and (h)(3). 

4 ‘‘(3) AVAILABILITY.—Funds made available to 

5 an eligible entity under this section for a fiscal year 

6 shall remain available for expenditure by the eligible 

7 entity through the end of the second succeeding fis8 cal year after award. Any funds that are not ex9 pended by the eligible entity during the period in 

10 which the funds are available under the preceding 

11 sentence may be used for grants to nonprofit organi12 zations under subsection (h)(2)(B). 

13 ‘‘(k) DEFINITIONS.—In this section: 

14 ‘‘(1) ELIGIBLE ENTITY.— 

15 ‘‘(A) IN GENERAL.—The term ‘eligible en16 tity’ means a State, an Indian Tribe, Tribal Or17 ganization, or Urban Indian Organization, 

18 Puerto Rico, Guam, the Virgin Islands, the 

19 Northern Mariana Islands, and American 

20 Samoa. 

21 ‘‘(B) NONPROFIT ORGANIZATIONS.—Only 

22 for purposes of awarding grants under sub23 section (h)(2)(B), such term shall include a 

24 nonprofit organization with an established 

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1 tion programs or initiatives in a State or sev2 eral States. 

3 ‘‘(2) ELIGIBLE FAMILY.—The term ‘eligible 

4 family’ means— 

5 ‘‘(A) a woman who is pregnant, and the fa6 ther of the child if the father is available; or 

7 ‘‘(B) a parent or primary caregiver of a 

8 child, including grandparents or other relatives 

9 of the child, and foster parents, who are serving 

10 as the child’s primary caregiver from birth to 

11 kindergarten entry, and including a noncusto12 dial parent who has an ongoing relationship 

13 with, and at times provides physical care for, 

14 the child. 

15 ‘‘(3) INDIAN TRIBE; TRIBAL ORGANIZATION.— 

16 The terms ‘Indian Tribe’ and ‘Tribal Organization’, 

17 and ‘Urban Indian Organization’ have the meanings 

18 given such terms in section 4 of the Indian Health 

19 Care Improvement Act.’’. 

20 SEC. 2952. SUPPORT, EDUCATION, AND RESEARCH FOR 

21 POSTPARTUM DEPRESSION. 

22 (a) RESEARCH ON POSTPARTUM CONDITIONS.— 

23 (1) EXPANSION AND INTENSIFICATION OF AC24 TIVITIES.—The Secretary of Health and Human 

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1 ferred to as the ‘‘Secretary’’) is encouraged to con2 tinue activities on postpartum depression or 

3 postpartum psychosis (in this subsection and sub4 section (c) referred to as ‘‘postpartum conditions’’), 

5 including research to expand the understanding of 

6 the causes of, and treatments for, postpartum condi7 tions. Activities under this paragraph shall include 

8 conducting and supporting the following: 

9 (A) Basic research concerning the etiology 

10 and causes of the conditions. 

11 (B) Epidemiological studies to address the 

12 frequency and natural history of the conditions 

13 and the differences among racial and ethnic 

14 groups with respect to the conditions. 

15 (C) The development of improved screen16 ing and diagnostic techniques. 

17 (D) Clinical research for the development 

18 and evaluation of new treatments. 

19 (E) Information and education programs 

20 for health care professionals and the public, 

21 which may include a coordinated national cam22 paign to increase the awareness and knowledge 

23 of postpartum conditions. Activities under such 

24 a national campaign may— 


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1 (i) include public service announce2 ments through television, radio, and other 

3 means; and 

4 (ii) focus on— 

5 (I) raising awareness about 

6 screening; 

7 (II) educating new mothers and 

8 their families about postpartum condi9 tions to promote earlier diagnosis and 

10 treatment; and 

11 (III) ensuring that such edu12 cation includes complete information 

13 concerning postpartum conditions, in14 cluding its symptoms, methods of cop15 ing with the illness, and treatment re16 sources. 

17 (2) SENSE OF CONGRESS REGARDING LONGITU18 DINAL STUDY OF RELATIVE MENTAL HEALTH CON19 SEQUENCES FOR WOMEN OF RESOLVING A PREG20 NANCY.— 

21 (A) SENSE OF CONGRESS.—It is the sense 

22 of Congress that the Director of the National 

23 Institute of Mental Health may conduct a na24 tionally representative longitudinal study (dur25 ing the period of fiscal years 2010 through 


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1 2019) of the relative mental health con2 sequences for women of resolving a pregnancy 

3 (intended and unintended) in various ways, in4 cluding carrying the pregnancy to term and 

5 parenting the child, carrying the pregnancy to 

6 term and placing the child for adoption, mis7 carriage, and having an abortion. This study 

8 may assess the incidence, timing, magnitude, 

9 and duration of the immediate and long-term 

10 mental health consequences (positive or nega11 tive) of these pregnancy outcomes. 

12 (B) REPORT.—Subject to the completion 

13 of the study under subsection (a), beginning not 

14 later than 5 years after the date of the enact15 ment of this Act, and periodically thereafter for 

16 the duration of the study, such Director may 

17 prepare and submit to the Congress reports on 

18 the findings of the study. 

19 (b) GRANTS TO PROVIDE SERVICES TO INDIVIDUALS

20 WITH A POSTPARTUM CONDITION AND THEIR FAMI21 LIES.—Title V of the Social Security Act (42 U.S.C. 701 

22 et seq.), as amended by section 2951, is amended by add23 ing at the end the following new section: 


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1 ‘‘SEC. 512. SERVICES TO INDIVIDUALS WITH A 

2 POSTPARTUM CONDITION AND THEIR FAMI3 LIES. 

4 ‘‘(a) IN GENERAL.—In addition to any other pay5 ments made under this title to a State, the Secretary may 

6 make grants to eligible entities for projects for the estab7 lishment, operation, and coordination of effective and cost8 efficient systems for the delivery of essential services to 

9 individuals with or at risk for postpartum conditions and 

10 their families. 

11 ‘‘(b) CERTAIN ACTIVITIES.—To the extent prac12 ticable and appropriate, the Secretary shall ensure that 

13 projects funded under subsection (a) provide education 

14 and services with respect to the diagnosis and manage15 ment of postpartum conditions for individuals with or at 

16 risk for postpartum conditions and their families. The Sec17 retary may allow such projects to include the following: 

18 ‘‘(1) Delivering or enhancing outpatient and 

19 home-based health and support services, including 

20 case management and comprehensive treatment 

21 services. 

22 ‘‘(2) Delivering or enhancing inpatient care 

23 management services that ensure the well-being of 

24 the mother and family and the future development 

25 of the infant. 


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1 ‘‘(3) Improving the quality, availability, and or2 ganization of health care and support services (in3 cluding transportation services, attendant care, 

4 homemaker services, day or respite care, and pro5 viding counseling on financial assistance and insur6 ance). 

7 ‘‘(4) Providing education about postpartum 

8 conditions to promote earlier diagnosis and treat9 ment. Such education may include— 

10 ‘‘(A) providing complete information on 

11 postpartum conditions, symptoms, methods of 

12 coping with the illness, and treatment re13 sources; and 

14 ‘‘(B) in the case of a grantee that is a 

15 State, hospital, or birthing facility— 

16 ‘‘(i) providing education to new moth17 ers and fathers, and other family members 

18 as appropriate, concerning postpartum 

19 conditions before new mothers leave the 

20 health facility; and 

21 ‘‘(ii) ensuring that training programs 

22 regarding such education are carried out 

23 at the health facility. 

24 ‘‘(c) INTEGRATION WITH OTHER PROGRAMS.—To 

25 the extent practicable and appropriate, the Secretary may 


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1 integrate the grant program under this section with other 

2 grant programs carried out by the Secretary, including the 

3 program under section 330 of the Public Health Service 

4 Act. 

5 ‘‘(d) REQUIREMENTS.—The Secretary shall establish 

6 requirements for grants made under this section that in7 clude a limit on the amount of grants funds that may be 

8 used for administration, accounting, reporting, or program 

9 oversight functions and a requirement for each eligible en10 tity that receives a grant to submit, for each grant period, 

11 a report to the Secretary that describes how grant funds 

12 were used during such period. 

13 ‘‘(e) TECHNICAL ASSISTANCE.—The Secretary may 

14 provide technical assistance to entities seeking a grant 

15 under this section in order to assist such entities in com16 plying with the requirements of this section. 

17 ‘‘(f) APPLICATION OF OTHER PROVISIONS OF

18 TITLE.— 

19 ‘‘(1) IN GENERAL.—Except as provided in para20 graph (2), the other provisions of this title shall not 

21 apply to a grant made under this section. 

22 ‘‘(2) EXCEPTIONS.—The following provisions of 

23 this title shall apply to a grant made under this sec24 tion to the same extent and in the same manner as 


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1 such provisions apply to allotments made under sec2 tion 502(c): 

3 ‘‘(A) Section 504(b)(6) (relating to prohi4 bition on payments to excluded individuals and 

5 entities). 

6 ‘‘(B) Section 504(c) (relating to the use of 

7 funds for the purchase of technical assistance). 

8 ‘‘(C) Section 504(d) (relating to a limita9 tion on administrative expenditures). 

10 ‘‘(D) Section 506 (relating to reports and 

11 audits), but only to the extent determined by 

12 the Secretary to be appropriate for grants made 

13 under this section. 

14 ‘‘(E) Section 507 (relating to penalties for 

15 false statements). 

16 ‘‘(F) Section 508 (relating to non17 discrimination). 

18 ‘‘(G) Section 509(a) (relating to the ad19 ministration of the grant program). 

20 ‘‘(g) DEFINITIONS.—In this section: 

21 ‘‘(1) The term ‘eligible entity’— 

22 ‘‘(A) means a public or nonprofit private 

23 entity; and 

24 ‘‘(B) includes a State or local government, 

25 public-private partnership, recipient of a grant 


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1 under section 330H of the Public Health Serv2 ice Act (relating to the Healthy Start Initia3 tive), public or nonprofit private hospital, com4 munity-based organization, hospice, ambulatory 

5 care facility, community health center, migrant 

6 health center, public housing primary care cen7 ter, or homeless health center. 

8 ‘‘(2) The term ‘postpartum condition’ means 

9 postpartum depression or postpartum psychosis.’’. 

10 (c) GENERAL PROVISIONS.— 

11 (1) AUTHORIZATION OF APPROPRIATIONS.—To 

12 carry out this section and the amendment made by 

13 subsection (b), there are authorized to be appro14 priated, in addition to such other sums as may be 

15 available for such purpose— 

16 (A) $3,000,000 for fiscal year 2010; and 

17 (B) such sums as may be necessary for fis18 cal years 2011 and 2012. 

19 (2) REPORT BY THE SECRETARY.— 

20 (A) STUDY.—The Secretary shall conduct 

21 a study on the benefits of screening for 

22 postpartum conditions. 

23 (B) REPORT.—Not later than 2 years after 

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1 paragraph (A) and submit a report to the Con2 gress on the results of such study. 

3 SEC. 2953. PERSONAL RESPONSIBILITY EDUCATION. 

4 Title V of the Social Security Act (42 U.S.C. 701 

5 et seq.), as amended by sections 2951 and 2952(c), is 

6 amended by adding at the end the following: 

7 ‘‘SEC. 513. PERSONAL RESPONSIBILITY EDUCATION. 

8 ‘‘(a) ALLOTMENTS TO STATES.— 

9 ‘‘(1) AMOUNT.— 

10 ‘‘(A) IN GENERAL.—For the purpose de11 scribed in subsection (b), subject to the suc12 ceeding provisions of this section, for each of 

13 fiscal years 2010 through 2014, the Secretary 

14 shall allot to each State an amount equal to the 

15 product of— 

16 ‘‘(i) the amount appropriated under 

17 subsection (f) for the fiscal year and avail18 able for allotments to States after the ap19 plication of subsection (c); and 

20 ‘‘(ii) the State youth population per21 centage determined under paragraph (2). 

22 ‘‘(B) MINIMUM ALLOTMENT.— 

23 ‘‘(i) IN GENERAL.—Each State allot24 ment under this paragraph for a fiscal 

25 year shall be at least $250,000. 


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1 ‘‘(ii) PRO RATA ADJUSTMENTS.—The 

2 Secretary shall adjust on a pro rata basis 

3 the amount of the State allotments deter4 mined under this paragraph for a fiscal 

5 year to the extent necessary to comply with 

6 clause (i). 

7 ‘‘(C) APPLICATION REQUIRED TO ACCESS

8 ALLOTMENTS.— 

9 ‘‘(i) IN GENERAL.—A State shall not 

10 be paid from its allotment for a fiscal year 

11 unless the State submits an application to 

12 the Secretary for the fiscal year and the 

13 Secretary approves the application (or re14 quires changes to the application that the 

15 State satisfies) and meets such additional 

16 requirements as the Secretary may specify. 

17 ‘‘(ii) REQUIREMENTS.—The State ap18 plication shall contain an assurance that 

19 the State has complied with the require20 ments of this section in preparing and sub21 mitting the application and shall include 

22 the following as well as such additional in23 formation as the Secretary may require: 

24 ‘‘(I) Based on data from the 

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1 vention National Center for Health 

2 Statistics, the most recent pregnancy 

3 rates for the State for youth ages 10 

4 to 14 and youth ages 15 to 19 for 

5 which data are available, the most re6 cent birth rates for such youth popu7 lations in the State for which data are 

8 available, and trends in those rates 

9 for the most recently preceding 5-year 

10 period for which such data are avail11 able. 

12 ‘‘(II) State-established goals for 

13 reducing the pregnancy rates and 

14 birth rates for such youth populations. 

15 ‘‘(III) A description of the 

16 State’s plan for using the State allot17 ments provided under this section to 

18 achieve such goals, especially among 

19 youth populations that are the most 

20 high-risk or vulnerable for pregnancies 

21 or otherwise have special cir22 cumstances, including youth in foster 

23 care, homeless youth, youth with HIV/ 

24 AIDS, pregnant youth who are under 

25 21 years of age, mothers who are 


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1 under 21 years of age, and youth re2 siding in areas with high birth rates 

3 for youth. 

4 ‘‘(2) STATE YOUTH POPULATION PERCENT5 AGE.— 

6 ‘‘(A) IN GENERAL.—For purposes of para7 graph (1)(A)(ii), the State youth population 

8 percentage is, with respect to a State, the pro9 portion (expressed as a percentage) of— 

10 ‘‘(i) the number of individuals who 

11 have attained age 10 but not attained age 

12 20 in the State; to 

13 ‘‘(ii) the number of such individuals in 

14 all States. 

15 ‘‘(B) DETERMINATION OF NUMBER OF

16 YOUTH.—The number of individuals described 

17 in clauses (i) and (ii) of subparagraph (A) in a 

18 State shall be determined on the basis of the 

19 most recent Bureau of the Census data. 

20 ‘‘(3) AVAILABILITY OF STATE ALLOTMENTS.— 

21 Subject to paragraph (4)(A), amounts allotted to a 

22 State pursuant to this subsection for a fiscal year 

23 shall remain available for expenditure by the State 

24 through the end of the second succeeding fiscal year. 


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1 ‘‘(4) AUTHORITY TO AWARD GRANTS FROM

2 STATE ALLOTMENTS TO LOCAL ORGANIZATIONS AND

3 ENTITIES IN NONPARTICIPATING STATES.— 

4 ‘‘(A) GRANTS FROM UNEXPENDED ALLOT5 MENTS.—If a State does not submit an applica6 tion under this section for fiscal year 2010 or 

7 2011, the State shall no longer be eligible to 

8 submit an application to receive funds from the 

9 amounts allotted for the State for each of fiscal 

10 years 2010 through 2014 and such amounts 

11 shall be used by the Secretary to award grants 

12 under this paragraph for each of fiscal years 

13 2012 through 2014. The Secretary also shall 

14 use any amounts from the allotments of States 

15 that submit applications under this section for 

16 a fiscal year that remain unexpended as of the 

17 end of the period in which the allotments are 

18 available for expenditure under paragraph (3) 

19 for awarding grants under this paragraph. 

20 ‘‘(B) 3-YEAR GRANTS.— 

21 ‘‘(i) IN GENERAL.—The Secretary 

22 shall solicit applications to award 3-year 

23 grants in each of fiscal years 2012, 2013, 

24 and 2014 to local organizations and enti25 ties to conduct, consistent with subsection 


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1 (b), programs and activities in States that 

2 do not submit an application for an allot3 ment under this section for fiscal year 

4 2010 or 2011. 

5 ‘‘(ii) FAITH-BASED ORGANIZATIONS

6 OR CONSORTIA.—The Secretary may solicit 

7 and award grants under this paragraph to 

8 faith-based organizations or consortia. 

9 ‘‘(C) EVALUATION.—An organization or 

10 entity awarded a grant under this paragraph 

11 shall agree to participate in a rigorous Federal 

12 evaluation. 

13 ‘‘(5) MAINTENANCE OF EFFORT.—No payment 

14 shall be made to a State from the allotment deter15 mined for the State under this subsection or to a 

16 local organization or entity awarded a grant under 

17 paragraph (4), if the expenditure of non-federal 

18 funds by the State, organization, or entity for activi19 ties, programs, or initiatives for which amounts from 

20 allotments and grants under this subsection may be 

21 expended is less than the amount expended by the 

22 State, organization, or entity for such programs or 

23 initiatives for fiscal year 2009. 

24 ‘‘(6) DATA COLLECTION AND REPORTING.—A 

25 State or local organization or entity receiving funds 


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1 under this section shall cooperate with such require2 ments relating to the collection of data and informa3 tion and reporting on outcomes regarding the pro4 grams and activities carried out with such funds, as 

5 the Secretary shall specify. 

6 ‘‘(b) PURPOSE.— 

7 ‘‘(1) IN GENERAL.—The purpose of an allot8 ment under subsection (a)(1) to a State is to enable 

9 the State (or, in the case of grants made under sub10 section (a)(4)(B), to enable a local organization or 

11 entity) to carry out personal responsibility education 

12 programs consistent with this subsection. 

13 ‘‘(2) PERSONAL RESPONSIBILITY EDUCATION

14 PROGRAMS.— 

15 ‘‘(A) IN GENERAL.—In this section, the 

16 term ‘personal responsibility education pro17 gram’ means a program that is designed to 

18 educate adolescents on— 

19 ‘‘(i) both abstinence and contraception 

20 for the prevention of pregnancy and sexu21 ally transmitted infections, including HIV/ 

22 AIDS, consistent with the requirements of 

23 subparagraph (B); and 


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1 ‘‘(ii) at least 3 of the adulthood prep2 aration subjects described in subparagraph 

3 (C). 

4 ‘‘(B) REQUIREMENTS.—The requirements 

5 of this subparagraph are the following: 

6 ‘‘(i) The program replicates evidence7 based effective programs or substantially 

8 incorporates elements of effective programs 

9 that have been proven on the basis of rig10 orous scientific research to change behav11 ior, which means delaying sexual activity, 

12 increasing condom or contraceptive use for 

13 sexually active youth, or reducing preg14 nancy among youth. 

15 ‘‘(ii) The program is medically-accu16 rate and complete. 

17 ‘‘(iii) The program includes activities 

18 to educate youth who are sexually active 

19 regarding responsible sexual behavior with 

20 respect to both abstinence and the use of 

21 contraception. 

22 ‘‘(iv) The program places substantial 

23 emphasis on both abstinence and contra24 ception for the prevention of pregnancy 


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1 among youth and sexually transmitted in2 fections. 

3 ‘‘(v) The program provides age-appro4 priate information and activities. 

5 ‘‘(vi) The information and activities 

6 carried out under the program are pro7 vided in the cultural context that is most 

8 appropriate for individuals in the par9 ticular population group to which they are 

10 directed. 

11 ‘‘(C) ADULTHOOD PREPARATION SUB12 JECTS.—The adulthood preparation subjects 

13 described in this subparagraph are the fol14 lowing: 

15 ‘‘(i) Healthy relationships, such as 

16 positive self-esteem and relationship dy17 namics, friendships, dating, romantic in18 volvement, marriage, and family inter19 actions. 

20 ‘‘(ii) Adolescent development, such as 

21 the development of healthy attitudes and 

22 values about adolescent growth and devel23 opment, body image, racial and ethnic di24 versity, and other related subjects. 

25 ‘‘(iii) Financial literacy. 


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1 ‘‘(iv) Parent-child communication. 

2 ‘‘(v) Educational and career success, 

3 such as developing skills for employment 

4 preparation, job seeking, independent liv5 ing, financial self-sufficiency, and work6 place productivity. 

7 ‘‘(vi) Healthy life skills, such as goal8 setting, decision making, negotiation, com9 munication and interpersonal skills, and 

10 stress management. 

11 ‘‘(c) RESERVATIONS OF FUNDS.— 

12 ‘‘(1) GRANTS TO IMPLEMENT INNOVATIVE

13 STRATEGIES.—From the amount appropriated under 

14 subsection (f) for the fiscal year, the Secretary shall 

15 reserve $10,000,000 of such amount for purposes of 

16 awarding grants to entities to implement innovative 

17 youth pregnancy prevention strategies and target 

18 services to high-risk, vulnerable, and culturally 

19 under-represented youth populations, including 

20 youth in foster care, homeless youth, youth with 

21 HIV/AIDS, pregnant women who are under 21 years 

22 of age and their partners, mothers who are under 21 

23 years of age and their partners, and youth residing 

24 in areas with high birth rates for youth. An entity 

25 awarded a grant under this paragraph shall agree to 


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1 participate in a rigorous Federal evaluation of the 

2 activities carried out with grant funds. 

3 ‘‘(2) OTHER RESERVATIONS.—From the 

4 amount appropriated under subsection (f) for the 

5 fiscal year that remains after the application of 

6 paragraph (1), the Secretary shall reserve the fol7 lowing amounts: 

8 ‘‘(A) GRANTS FOR INDIAN TRIBES OR

9 TRIBAL ORGANIZATIONS.—The Secretary shall 

10 reserve 5 percent of such remainder for pur11 poses of awarding grants to Indian tribes and 

12 tribal organizations in such manner, and sub13 ject to such requirements, as the Secretary, in 

14 consultation with Indian tribes and tribal orga15 nizations, determines appropriate. 

16 ‘‘(B) SECRETARIAL RESPONSIBILITIES.— 

17 ‘‘(i) RESERVATION OF FUNDS.—The 

18 Secretary shall reserve 10 percent of such 

19 remainder for expenditures by the Sec20 retary for the activities described in 

21 clauses (ii) and (iii). 

22 ‘‘(ii) PROGRAM SUPPORT.—The Sec23 retary shall provide, directly or through a 

24 competitive grant process, research, train25 ing and technical assistance, including disVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00614 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 semination of research and information re2 garding effective and promising practices, 

3 providing consultation and resources on a 

4 broad array of teen pregnancy prevention 

5 strategies, including abstinence and contra6 ception, and developing resources and ma7 terials to support the activities of recipi8 ents of grants and other State, tribal, and 

9 community organizations working to re10 duce teen pregnancy. In carrying out such 

11 functions, the Secretary shall collaborate 

12 with a variety of entities that have exper13 tise in the prevention of teen pregnancy, 

14 HIV and sexually transmitted infections, 

15 healthy relationships, financial literacy, 

16 and other topics addressed through the 

17 personal responsibility education programs. 

18 ‘‘(iii) EVALUATION.—The Secretary 

19 shall evaluate the programs and activities 

20 carried out with funds made available 

21 through allotments or grants under this 

22 section. 

23 ‘‘(d) ADMINISTRATION.— 

24 ‘‘(1) IN GENERAL.—The Secretary shall admin25 ister this section through the Assistant Secretary for 


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1 the Administration for Children and Families within 

2 the Department of Health and Human Services. 

3 ‘‘(2) APPLICATION OF OTHER PROVISIONS OF

4 TITLE.— 

5 ‘‘(A) IN GENERAL.—Except as provided in 

6 subparagraph (B), the other provisions of this 

7 title shall not apply to allotments or grants 

8 made under this section. 

9 ‘‘(B) EXCEPTIONS.—The following provi10 sions of this title shall apply to allotments and 

11 grants made under this section to the same ex12 tent and in the same manner as such provisions 

13 apply to allotments made under section 502(c): 

14 ‘‘(i) Section 504(b)(6) (relating to 

15 prohibition on payments to excluded indi16 viduals and entities). 

17 ‘‘(ii) Section 504(c) (relating to the 

18 use of funds for the purchase of technical 

19 assistance). 

20 ‘‘(iii) Section 504(d) (relating to a 

21 limitation on administrative expenditures). 

22 ‘‘(iv) Section 506 (relating to reports 

23 and audits), but only to the extent deter24 mined by the Secretary to be appropriate 

25 for grants made under this section. 


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1 ‘‘(v) Section 507 (relating to penalties 

2 for false statements). 

3 ‘‘(vi) Section 508 (relating to non4 discrimination). 

5 ‘‘(e) DEFINITIONS.—In this section: 

6 ‘‘(1) AGE-APPROPRIATE.—The term ‘age-appro7 priate’, with respect to the information in pregnancy 

8 prevention, means topics, messages, and teaching 

9 methods suitable to particular ages or age groups of 

10 children and adolescents, based on developing cog11 nitive, emotional, and behavioral capacity typical for 

12 the age or age group. 

13 ‘‘(2) MEDICALLY ACCURATE AND COMPLETE.— 

14 The term ‘medically accurate and complete’ means 

15 verified or supported by the weight of research con16 ducted in compliance with accepted scientific meth17 ods and— 

18 ‘‘(A) published in peer-reviewed journals, 

19 where applicable; or 

20 ‘‘(B) comprising information that leading 

21 professional organizations and agencies with 

22 relevant expertise in the field recognize as accu23 rate, objective, and complete. 

24 ‘‘(3) INDIAN TRIBES; TRIBAL ORGANIZA25 TIONS.—The terms ‘Indian tribe’ and ‘Tribal organiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00617 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 zation’ have the meanings given such terms in sec2 tion 4 of the Indian Health Care Improvement Act 

3 (25 U.S.C. 1603)). 

4 ‘‘(4) YOUTH.—The term ‘youth’ means an indi5 vidual who has attained age 10 but has not attained 

6 age 20. 

7 ‘‘(f) APPROPRIATION.—For the purpose of carrying 

8 out this section, there is appropriated, out of any money 

9 in the Treasury not otherwise appropriated, $75,000,000 

10 for each of fiscal years 2010 through 2014. Amounts ap11 propriated under this subsection shall remain available 

12 until expended.’’. 

13 SEC. 2954. RESTORATION OF FUNDING FOR ABSTINENCE 

14 EDUCATION. 

15 Section 510 of the Social Security Act (42 U.S.C. 

16 710) is amended— 

17 (1) in subsection (a), by striking ‘‘fiscal year 

18 1998 and each subsequent fiscal year’’ and inserting 

19 ‘‘each of fiscal years 2010 through 2014’’; and 

20 (2) in subsection (d)— 

21 (A) in the first sentence, by striking ‘‘1998 

22 through 2003’’ and inserting ‘‘2010 through 

23 2014’’; and 

24 (B) in the second sentence, by inserting 

25 ‘‘(except that such appropriation shall be made 


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1 on the date of enactment of the Patient Protec2 tion and Affordable Care Act in the case of fis3 cal year 2010)’’ before the period. 

4 SEC. 2955. INCLUSION OF INFORMATION ABOUT THE IM5 PORTANCE OF HAVING A HEALTH CARE 

6 POWER OF ATTORNEY IN TRANSITION PLAN7 NING FOR CHILDREN AGING OUT OF FOSTER 

8 CARE AND INDEPENDENT LIVING PROGRAMS. 

9 (a) TRANSITION PLANNING.—Section 475(5)(H) of 

10 the Social Security Act (42 U.S.C. 675(5)(H)) is amended 

11 by inserting ‘‘includes information about the importance 

12 of designating another individual to make health care 

13 treatment decisions on behalf of the child if the child be14 comes unable to participate in such decisions and the child 

15 does not have, or does not want, a relative who would oth16 erwise be authorized under State law to make such deci17 sions, and provides the child with the option to execute 

18 a health care power of attorney, health care proxy, or 

19 other similar document recognized under State law,’’ after 

20 ‘‘employment services,’’. 

21 (b) INDEPENDENT LIVING EDUCATION.—Section 

22 477(b)(3) of such Act (42 U.S.C. 677(b)(3)) is amended 

23 by adding at the end the following: 

24 ‘‘(K) A certification by the chief executive 

25 officer of the State that the State will ensure 


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1 that an adolescent participating in the program 

2 under this section are provided with education 

3 about the importance of designating another in4 dividual to make health care treatment deci5 sions on behalf of the adolescent if the adoles6 cent becomes unable to participate in such deci7 sions and the adolescent does not have, or does 

8 not want, a relative who would otherwise be au9 thorized under State law to make such deci10 sions, whether a health care power of attorney, 

11 health care proxy, or other similar document is 

12 recognized under State law, and how to execute 

13 such a document if the adolescent wants to do 

14 so.’’. 

15 (c) HEALTH OVERSIGHT AND COORDINATION

16 PLAN.—Section 422(b)(15)(A) of such Act (42 U.S.C. 

17 622(b)(15)(A)) is amended— 

18 (1) in clause (v), by striking ‘‘and’’ at the end; 

19 and 

20 (2) by adding at the end the following: 

21 ‘‘(vii) steps to ensure that the compo22 nents of the transition plan development 

23 process required under section 475(5)(H) 

24 that relate to the health care needs of chil25 dren aging out of foster care, including the 


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1 requirements to include options for health 

2 insurance, information about a health care 

3 power of attorney, health care proxy, or 

4 other similar document recognized under 

5 State law, and to provide the child with the 

6 option to execute such a document, are 

7 met; and’’. 

8 (d) EFFECTIVE DATE.—The amendments made by 

9 this section take effect on October 1, 2010. 

10 TITLE III—IMPROVING THE 

11 QUALITY AND EFFICIENCY OF 

12 HEALTH CARE 

13 Subtitle A—Transforming the 

14 Health Care Delivery System 

15 PART I—LINKING PAYMENT TO QUALITY 

16 OUTCOMES UNDER THE MEDICARE PROGRAM 

17 SEC. 3001. HOSPITAL VALUE-BASED PURCHASING PRO18 GRAM. 

19 (a) PROGRAM.— 

20 (1) IN GENERAL.—Section 1886 of the Social 

21 Security Act (42 U.S.C. 1395ww), as amended by 

22 section 4102(a) of the HITECH Act (Public Law 

23 111–5), is amended by adding at the end the fol24 lowing new subsection: 


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1 ‘‘(o) HOSPITAL VALUE-BASED PURCHASING PRO2 GRAM.— 

3 ‘‘(1) ESTABLISHMENT.— 

4 ‘‘(A) IN GENERAL.—Subject to the suc5 ceeding provisions of this subsection, the Sec6 retary shall establish a hospital value-based 

7 purchasing program (in this subsection referred 

8 to as the ‘Program’) under which value-based 

9 incentive payments are made in a fiscal year to 

10 hospitals that meet the performance standards 

11 under paragraph (3) for the performance period 

12 for such fiscal year (as established under para13 graph (4)). 

14 ‘‘(B) PROGRAM TO BEGIN IN FISCAL YEAR

15 2013.—The Program shall apply to payments 

16 for discharges occurring on or after October 1, 

17 2012. 

18 ‘‘(C) APPLICABILITY OF PROGRAM TO HOS19 PITALS.— 

20 ‘‘(i) IN GENERAL.—For purposes of 

21 this subsection, subject to clause (ii), the 

22 term ‘hospital’ means a subsection (d) hos23 pital (as defined in subsection (d)(1)(B)). 


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1 ‘‘(ii) EXCLUSIONS.—The term ‘hos2 pital’ shall not include, with respect to a 

3 fiscal year, a hospital— 

4 ‘‘(I) that is subject to the pay5 ment reduction under subsection 

6 (b)(3)(B)(viii)(I) for such fiscal year; 

7 ‘‘(II) for which, during the per8 formance period for such fiscal year, 

9 the Secretary has cited deficiencies 

10 that pose immediate jeopardy to the 

11 health or safety of patients; 

12 ‘‘(III) for which there are not a 

13 minimum number (as determined by 

14 the Secretary) of measures that apply 

15 to the hospital for the performance 

16 period for such fiscal year; or 

17 ‘‘(IV) for which there are not a 

18 minimum number (as determined by 

19 the Secretary) of cases for the meas20 ures that apply to the hospital for the 

21 performance period for such fiscal 

22 year. 

23 ‘‘(iii) INDEPENDENT ANALYSIS.—For 

24 purposes of determining the minimum 

25 numbers under subclauses (III) and (IV) 


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1 of clause (ii), the Secretary shall have con2 ducted an independent analysis of what 

3 numbers are appropriate. 

4 ‘‘(iv) EXEMPTION.—In the case of a 

5 hospital that is paid under section 

6 1814(b)(3), the Secretary may exempt 

7 such hospital from the application of this 

8 subsection if the State which is paid under 

9 such section submits an annual report to 

10 the Secretary describing how a similar pro11 gram in the State for a participating hos12 pital or hospitals achieves or surpasses the 

13 measured results in terms of patient health 

14 outcomes and cost savings established 

15 under this subsection. 

16 ‘‘(2) MEASURES.— 

17 ‘‘(A) IN GENERAL.—The Secretary shall 

18 select measures for purposes of the Program. 

19 Such measures shall be selected from the meas20 ures specified under subsection (b)(3)(B)(viii). 

21 ‘‘(B) REQUIREMENTS.— 

22 ‘‘(i) FOR FISCAL YEAR 2013.—For 

23 value-based incentive payments made with 

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1 cal year 2013, the Secretary shall ensure 

2 the following: 

3 ‘‘(I) CONDITIONS OR PROCE4 DURES.—Measures are selected under 

5 subparagraph (A) that cover at least 

6 the following 5 specific conditions or 

7 procedures: 

8 ‘‘(aa) Acute myocardial in9 farction (AMI). 

10 ‘‘(bb) Heart failure. 

11 ‘‘(cc) Pneumonia. 

12 ‘‘(dd) Surgeries, as meas13 ured by the Surgical Care Im14 provement Project (formerly re15 ferred to as ‘Surgical Infection 

16 Prevention’ for discharges occur17 ring before July 2006). 

18 ‘‘(ee) Healthcare-associated 

19 infections, as measured by the 

20 prevention metrics and targets 

21 established in the HHS Action 

22 Plan to Prevent Healthcare-Asso23 ciated Infections (or any suc24 cessor plan) of the Department 

25 of Health and Human Services. 


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1 ‘‘(II) HCAHPS.—Measures se2 lected under subparagraph (A) shall 

3 be related to the Hospital Consumer 

4 Assessment of Healthcare Providers 

5 and Systems survey (HCAHPS). 

6 ‘‘(ii) INCLUSION OF EFFICIENCY

7 MEASURES.—For value-based incentive 

8 payments made with respect to discharges 

9 occurring during fiscal year 2014 or a sub10 sequent fiscal year, the Secretary shall en11 sure that measures selected under subpara12 graph (A) include efficiency measures, in13 cluding measures of ‘Medicare spending 

14 per beneficiary’. Such measures shall be 

15 adjusted for factors such as age, sex, race, 

16 severity of illness, and other factors that 

17 the Secretary determines appropriate. 

18 ‘‘(C) LIMITATIONS.— 

19 ‘‘(i) TIME REQUIREMENT FOR PRIOR

20 REPORTING AND NOTICE.—The Secretary 

21 may not select a measure under subpara22 graph (A) for use under the Program with 

23 respect to a performance period for a fiscal 

24 year (as established under paragraph (4)) 

25 unless such measure has been specified 


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1 under subsection (b)(3)(B)(viii) and in2 cluded on the Hospital Compare Internet 

3 website for at least 1 year prior to the be4 ginning of such performance period. 

5 ‘‘(ii) MEASURE NOT APPLICABLE UN6 LESS HOSPITAL FURNISHES SERVICES AP7 PROPRIATE TO THE MEASURE.—A measure 

8 selected under subparagraph (A) shall not 

9 apply to a hospital if such hospital does 

10 not furnish services appropriate to such 

11 measure. 

12 ‘‘(D) REPLACING MEASURES.—Subclause 

13 (VI) of subsection (b)(3)(B)(viii) shall apply to 

14 measures selected under subparagraph (A) in 

15 the same manner as such subclause applies to 

16 measures selected under such subsection. 

17 ‘‘(3) PERFORMANCE STANDARDS.— 

18 ‘‘(A) ESTABLISHMENT.—The Secretary 

19 shall establish performance standards with re20 spect to measures selected under paragraph (2) 

21 for a performance period for a fiscal year (as 

22 established under paragraph (4)). 

23 ‘‘(B) ACHIEVEMENT AND IMPROVE24 MENT.—The performance standards established 


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1 under subparagraph (A) shall include levels of 

2 achievement and improvement. 

3 ‘‘(C) TIMING.—The Secretary shall estab4 lish and announce the performance standards 

5 under subparagraph (A) not later than 60 days 

6 prior to the beginning of the performance pe7 riod for the fiscal year involved. 

8 ‘‘(D) CONSIDERATIONS IN ESTABLISHING

9 STANDARDS.—In establishing performance 

10 standards with respect to measures under this 

11 paragraph, the Secretary shall take into ac12 count appropriate factors, such as— 

13 ‘‘(i) practical experience with the 

14 measures involved, including whether a sig15 nificant proportion of hospitals failed to 

16 meet the performance standard during pre17 vious performance periods; 

18 ‘‘(ii) historical performance standards; 

19 ‘‘(iii) improvement rates; and 

20 ‘‘(iv) the opportunity for continued 

21 improvement. 

22 ‘‘(4) PERFORMANCE PERIOD.—For purposes of 

23 the Program, the Secretary shall establish the per24 formance period for a fiscal year. Such performance 


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1 period shall begin and end prior to the beginning of 

2 such fiscal year. 

3 ‘‘(5) HOSPITAL PERFORMANCE SCORE.— 

4 ‘‘(A) IN GENERAL.—Subject to subpara5 graph (B), the Secretary shall develop a meth6 odology for assessing the total performance of 

7 each hospital based on performance standards 

8 with respect to the measures selected under 

9 paragraph (2) for a performance period (as es10 tablished under paragraph (4)). Using such 

11 methodology, the Secretary shall provide for an 

12 assessment (in this subsection referred to as the 

13 ‘hospital performance score’) for each hospital 

14 for each performance period. 

15 ‘‘(B) APPLICATION.— 

16 ‘‘(i) APPROPRIATE DISTRIBUTION.— 

17 The Secretary shall ensure that the appli18 cation of the methodology developed under 

19 subparagraph (A) results in an appropriate 

20 distribution of value-based incentive pay21 ments under paragraph (6) among hos22 pitals achieving different levels of hospital 

23 performance scores, with hospitals achiev24 ing the highest hospital performance scores 


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1 receiving the largest value-based incentive 

2 payments. 

3 ‘‘(ii) HIGHER OF ACHIEVEMENT OR

4 IMPROVEMENT.—The methodology devel5 oped under subparagraph (A) shall provide 

6 that the hospital performance score is de7 termined using the higher of its achieve8 ment or improvement score for each meas9 ure. 

10 ‘‘(iii) WEIGHTS.—The methodology 

11 developed under subparagraph (A) shall 

12 provide for the assignment of weights for 

13 categories of measures as the Secretary de14 termines appropriate. 

15 ‘‘(iv) NO MINIMUM PERFORMANCE

16 STANDARD.—The Secretary shall not set a 

17 minimum performance standard in deter18 mining the hospital performance score for 

19 any hospital. 

20 ‘‘(v) REFLECTION OF MEASURES AP21 PLICABLE TO THE HOSPITAL.—The hos22 pital performance score for a hospital shall 

23 reflect the measures that apply to the hos24 pital. 


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1 ‘‘(6) CALCULATION OF VALUE-BASED INCEN2 TIVE PAYMENTS.— 

3 ‘‘(A) IN GENERAL.—In the case of a hos4 pital that the Secretary determines meets (or 

5 exceeds) the performance standards under para6 graph (3) for the performance period for a fis7 cal year (as established under paragraph (4)), 

8 the Secretary shall increase the base operating 

9 DRG payment amount (as defined in paragraph 

10 (7)(D)), as determined after application of 

11 paragraph (7)(B)(i), for a hospital for each dis12 charge occurring in such fiscal year by the 

13 value-based incentive payment amount. 

14 ‘‘(B) VALUE-BASED INCENTIVE PAYMENT

15 AMOUNT.—The value-based incentive payment 

16 amount for each discharge of a hospital in a fis17 cal year shall be equal to the product of— 

18 ‘‘(i) the base operating DRG payment 

19 amount (as defined in paragraph (7)(D)) 

20 for the discharge for the hospital for such 

21 fiscal year; and 

22 ‘‘(ii) the value-based incentive pay23 ment percentage specified under subpara24 graph (C) for the hospital for such fiscal 

25 year. 


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1 ‘‘(C) VALUE-BASED INCENTIVE PAYMENT

2 PERCENTAGE.— 

3 ‘‘(i) IN GENERAL.—The Secretary 

4 shall specify a value-based incentive pay5 ment percentage for a hospital for a fiscal 

6 year. 

7 ‘‘(ii) REQUIREMENTS.—In specifying 

8 the value-based incentive payment percent9 age for each hospital for a fiscal year 

10 under clause (i), the Secretary shall ensure 

11 that— 

12 ‘‘(I) such percentage is based on 

13 the hospital performance score of the 

14 hospital under paragraph (5); and 

15 ‘‘(II) the total amount of value16 based incentive payments under this 

17 paragraph to all hospitals in such fis18 cal year is equal to the total amount 

19 available for value-based incentive 

20 payments for such fiscal year under 

21 paragraph (7)(A), as estimated by the 

22 Secretary. 

23 ‘‘(7) FUNDING FOR VALUE-BASED INCENTIVE

24 PAYMENTS.— 


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1 ‘‘(A) AMOUNT.—The total amount avail2 able for value-based incentive payments under 

3 paragraph (6) for all hospitals for a fiscal year 

4 shall be equal to the total amount of reduced 

5 payments for all hospitals under subparagraph 

6 (B) for such fiscal year, as estimated by the 

7 Secretary. 

8 ‘‘(B) ADJUSTMENT TO PAYMENTS.— 

9 ‘‘(i) IN GENERAL.—The Secretary 

10 shall reduce the base operating DRG pay11 ment amount (as defined in subparagraph 

12 (D)) for a hospital for each discharge in a 

13 fiscal year (beginning with fiscal year 

14 2013) by an amount equal to the applica15 ble percent (as defined in subparagraph 

16 (C)) of the base operating DRG payment 

17 amount for the discharge for the hospital 

18 for such fiscal year. The Secretary shall 

19 make such reductions for all hospitals in 

20 the fiscal year involved, regardless of 

21 whether or not the hospital has been deter22 mined by the Secretary to have earned a 

23 value-based incentive payment under para24 graph (6) for such fiscal year. 


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1 ‘‘(ii) NO EFFECT ON OTHER PAY2 MENTS.—Payments described in items (aa) 

3 and (bb) of subparagraph (D)(i)(II) for a 

4 hospital shall be determined as if this sub5 section had not been enacted. 

6 ‘‘(C) APPLICABLE PERCENT DEFINED.— 

7 For purposes of subparagraph (B), the term 

8 ‘applicable percent’ means— 

9 ‘‘(i) with respect to fiscal year 2013, 

10 1.0 percent; 

11 ‘‘(ii) with respect to fiscal year 2014, 

12 1.25 percent; 

13 ‘‘(iii) with respect to fiscal year 2015, 

14 1.5 percent; 

15 ‘‘(iv) with respect to fiscal year 2016, 

16 1.75 percent; and 

17 ‘‘(v) with respect to fiscal year 2017 

18 and succeeding fiscal years, 2 percent. 

19 ‘‘(D) BASE OPERATING DRG PAYMENT

20 AMOUNT DEFINED.— 

21 ‘‘(i) IN GENERAL.—Except as pro22 vided in clause (ii), in this subsection, the 

23 term ‘base operating DRG payment 

24 amount’ means, with respect to a hospital 

25 for a fiscal year— 


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1 ‘‘(I) the payment amount that 

2 would otherwise be made under sub3 section (d) (determined without re4 gard to subsection (q)) for a discharge 

5 if this subsection did not apply; re6 duced by 

7 ‘‘(II) any portion of such pay8 ment amount that is attributable to— 

9 ‘‘(aa) payments under para10 graphs (5)(A), (5)(B), (5)(F), 

11 and (12) of subsection (d); and 

12 ‘‘(bb) such other payments 

13 under subsection (d) determined 

14 appropriate by the Secretary. 

15 ‘‘(ii) SPECIAL RULES FOR CERTAIN

16 HOSPITALS.— 

17 ‘‘(I) SOLE COMMUNITY HOS18 PITALS AND MEDICARE-DEPENDENT, 

19 SMALL RURAL HOSPITALS.—In the 

20 case of a medicare-dependent, small 

21 rural hospital (with respect to dis22 charges occurring during fiscal year 

23 2012 and 2013) or a sole community 

24 hospital, in applying subparagraph 

25 (A)(i), the payment amount that 


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1 would otherwise be made under sub2 section (d) shall be determined with3 out regard to subparagraphs (I) and 

4 (L) of subsection (b)(3) and subpara5 graphs (D) and (G) of subsection 

6 (d)(5). 

7 ‘‘(II) HOSPITALS PAID UNDER

8 SECTION 1814.—In the case of a hos9 pital that is paid under section 

10 1814(b)(3), the term ‘base operating 

11 DRG payment amount’ means the 

12 payment amount under such section. 

13 ‘‘(8) ANNOUNCEMENT OF NET RESULT OF AD14 JUSTMENTS.—Under the Program, the Secretary 

15 shall, not later than 60 days prior to the fiscal year 

16 involved, inform each hospital of the adjustments to 

17 payments to the hospital for discharges occurring in 

18 such fiscal year under paragraphs (6) and (7)(B)(i). 

19 ‘‘(9) NO EFFECT IN SUBSEQUENT FISCAL

20 YEARS.—The value-based incentive payment under 

21 paragraph (6) and the payment reduction under 

22 paragraph (7)(B)(i) shall each apply only with re23 spect to the fiscal year involved, and the Secretary 

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1 ments to a hospital under this section in a subse2 quent fiscal year. 

3 ‘‘(10) PUBLIC REPORTING.— 

4 ‘‘(A) HOSPITAL SPECIFIC INFORMATION.— 

5 ‘‘(i) IN GENERAL.—The Secretary 

6 shall make information available to the 

7 public regarding the performance of indi8 vidual hospitals under the Program, in9 cluding— 

10 ‘‘(I) the performance of the hos11 pital with respect to each measure 

12 that applies to the hospital; 

13 ‘‘(II) the performance of the hos14 pital with respect to each condition or 

15 procedure; and 

16 ‘‘(III) the hospital performance 

17 score assessing the total performance 

18 of the hospital. 

19 ‘‘(ii) OPPORTUNITY TO REVIEW AND

20 SUBMIT CORRECTIONS.—The Secretary 

21 shall ensure that a hospital has the oppor22 tunity to review, and submit corrections 

23 for, the information to be made public with 

24 respect to the hospital under clause (i) 


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1 prior to such information being made pub2 lic. 

3 ‘‘(iii) WEBSITE.—Such information 

4 shall be posted on the Hospital Compare 

5 Internet website in an easily understand6 able format. 

7 ‘‘(B) AGGREGATE INFORMATION.—The 

8 Secretary shall periodically post on the Hospital 

9 Compare Internet website aggregate informa10 tion on the Program, including— 

11 ‘‘(i) the number of hospitals receiving 

12 value-based incentive payments under 

13 paragraph (6) and the range and total 

14 amount of such value-based incentive pay15 ments; and 

16 ‘‘(ii) the number of hospitals receiving 

17 less than the maximum value-based incen18 tive payment available to the hospital for 

19 the fiscal year involved and the range and 

20 amount of such payments. 

21 ‘‘(11) IMPLEMENTATION.— 

22 ‘‘(A) APPEALS.—The Secretary shall es23 tablish a process by which hospitals may appeal 

24 the calculation of a hospital’s performance as25 sessment with respect to the performance 


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1 standards established under paragraph (3)(A) 

2 and the hospital performance score under para3 graph (5). The Secretary shall ensure that such 

4 process provides for resolution of such appeals 

5 in a timely manner. 

6 ‘‘(B) LIMITATION ON REVIEW.—Except as 

7 provided in subparagraph (A), there shall be no 

8 administrative or judicial review under section 

9 1869, section 1878, or otherwise of the fol10 lowing: 

11 ‘‘(i) The methodology used to deter12 mine the amount of the value-based incen13 tive payment under paragraph (6) and the 

14 determination of such amount. 

15 ‘‘(ii) The determination of the amount 

16 of funding available for such value-based 

17 incentive payments under paragraph 

18 (7)(A) and the payment reduction under 

19 paragraph (7)(B)(i). 

20 ‘‘(iii) The establishment of the per21 formance standards under paragraph (3) 

22 and the performance period under para23 graph (4). 


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1 ‘‘(iv) The measures specified under 

2 subsection (b)(3)(B)(viii) and the measures 

3 selected under paragraph (2). 

4 ‘‘(v) The methodology developed under 

5 paragraph (5) that is used to calculate 

6 hospital performance scores and the cal7 culation of such scores. 

8 ‘‘(vi) The validation methodology 

9 specified in subsection (b)(3)(B)(viii)(XI). 

10 ‘‘(C) CONSULTATION WITH SMALL HOS11 PITALS.—The Secretary shall consult with small 

12 rural and urban hospitals on the application of 

13 the Program to such hospitals. 

14 ‘‘(12) PROMULGATION OF REGULATIONS.—The 

15 Secretary shall promulgate regulations to carry out 

16 the Program, including the selection of measures 

17 under paragraph (2), the methodology developed 

18 under paragraph (5) that is used to calculate hos19 pital performance scores, and the methodology used 

20 to determine the amount of value-based incentive 

21 payments under paragraph (6).’’. 

22 (2) AMENDMENTS FOR REPORTING OF HOS23 PITAL QUALITY INFORMATION.—Section 

24 1886(b)(3)(B)(viii) of the Social Security Act (42 

25 U.S.C. 1395ww(b)(3)(B)(viii)) is amended— 


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1 (A) in subclause (II), by adding at the end 

2 the following sentence: ‘‘The Secretary may re3 quire hospitals to submit data on measures that 

4 are not used for the determination of value5 based incentive payments under subsection 

6 (o).’’; 

7 (B) in subclause (V), by striking ‘‘begin8 ning with fiscal year 2008’’ and inserting ‘‘for 

9 fiscal years 2008 through 2012’’; 

10 (C) in subclause (VII), in the first sen11 tence, by striking ‘‘data submitted’’ and insert12 ing ‘‘information regarding measures sub13 mitted’’; and 

14 (D) by adding at the end the following new 

15 subclauses: 

16 ‘‘(VIII) Effective for payments beginning with fiscal 

17 year 2013, with respect to quality measures for outcomes 

18 of care, the Secretary shall provide for such risk adjust19 ment as the Secretary determines to be appropriate to 

20 maintain incentives for hospitals to treat patients with se21 vere illnesses or conditions. 

22 ‘‘(IX)(aa) Subject to item (bb), effective for payments 

23 beginning with fiscal year 2013, each measure specified 

24 by the Secretary under this clause shall be endorsed by 

25 the entity with a contract under section 1890(a). 


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1 ‘‘(bb) In the case of a specified area or medical topic 

2 determined appropriate by the Secretary for which a fea3 sible and practical measure has not been endorsed by the 

4 entity with a contract under section 1890(a), the Sec5 retary may specify a measure that is not so endorsed as 

6 long as due consideration is given to measures that have 

7 been endorsed or adopted by a consensus organization 

8 identified by the Secretary. 

9 ‘‘(X) To the extent practicable, the Secretary shall, 

10 with input from consensus organizations and other stake11 holders, take steps to ensure that the measures specified 

12 by the Secretary under this clause are coordinated and 

13 aligned with quality measures applicable to— 

14 ‘‘(aa) physicians under section 1848(k); and 

15 ‘‘(bb) other providers of services and suppliers 

16 under this title. 

17 ‘‘(XI) The Secretary shall establish a process to vali18 date measures specified under this clause as appropriate. 

19 Such process shall include the auditing of a number of 

20 randomly selected hospitals sufficient to ensure validity of 

21 the reporting program under this clause as a whole and 

22 shall provide a hospital with an opportunity to appeal the 

23 validation of measures reported by such hospital.’’. 

24 (3) WEBSITE IMPROVEMENTS.—Section 

25 1886(b)(3)(B) of the Social Security Act (42 U.S.C. 


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1 1395ww(b)(3)(B)), as amended by section 4102(b) 

2 of the HITECH Act (Public Law 111–5), is amend3 ed by adding at the end the following new clause: 

4 ‘‘(x)(I) The Secretary shall develop standard Internet 

5 website reports tailored to meet the needs of various stake6 holders such as hospitals, patients, researchers, and pol7 icymakers. The Secretary shall seek input from such 

8 stakeholders in determining the type of information that 

9 is useful and the formats that best facilitate the use of 

10 the information. 

11 ‘‘(II) The Secretary shall modify the Hospital Com12 pare Internet website to make the use and navigation of 

13 that website readily available to individuals accessing it.’’. 

14 (4) GAO STUDY AND REPORT.— 

15 (A) STUDY.—The Comptroller General of 

16 the United States shall conduct a study on the 

17 performance of the hospital value-based pur18 chasing program established under section 

19 1886(o) of the Social Security Act, as added by 

20 paragraph (1). Such study shall include an 

21 analysis of the impact of such program on— 

22 (i) the quality of care furnished to 

23 Medicare beneficiaries, including diverse 

24 Medicare beneficiary populations (such as 


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1 diverse in terms of race, ethnicity, and so2 cioeconomic status); 

3 (ii) expenditures under the Medicare 

4 program, including any reduced expendi5 tures under Part A of title XVIII of such 

6 Act that are attributable to the improve7 ment in the delivery of inpatient hospital 

8 services by reason of such hospital value9 based purchasing program; 

10 (iii) the quality performance among 

11 safety net hospitals and any barriers such 

12 hospitals face in meeting the performance 

13 standards applicable under such hospital 

14 value-based purchasing program; and 

15 (iv) the quality performance among 

16 small rural and small urban hospitals and 

17 any barriers such hospitals face in meeting 

18 the performance standards applicable 

19 under such hospital value-based purchasing 

20 program. 

21 (B) REPORTS.— 

22 (i) INTERIM REPORT.—Not later than 

23 October 1, 2015, the Comptroller General 

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1 sults of the study conducted under sub2 paragraph (A), together with recommenda3 tions for such legislation and administra4 tive action as the Comptroller General de5 termines appropriate. 

6 (ii) FINAL REPORT.—Not later than 

7 July 1, 2017, the Comptroller General of 

8 the United States shall submit to Congress 

9 a report containing the results of the study 

10 conducted under subparagraph (A), to11 gether with recommendations for such leg12 islation and administrative action as the 

13 Comptroller General determines appro14 priate. 

15 (5) HHS STUDY AND REPORT.— 

16 (A) STUDY.—The Secretary of Health and 

17 Human Services shall conduct a study on the 

18 performance of the hospital value-based pur19 chasing program established under section 

20 1886(o) of the Social Security Act, as added by 

21 paragraph (1). Such study shall include an 

22 analysis— 

23 (i) of ways to improve the hospital 

24 value-based purchasing program and ways 

25 to address any unintended consequences 


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1 that may occur as a result of such pro2 gram; 

3 (ii) of whether the hospital value4 based purchasing program resulted in 

5 lower spending under the Medicare pro6 gram under title XVIII of such Act or 

7 other financial savings to hospitals; 

8 (iii) the appropriateness of the Medi9 care program sharing in any savings gen10 erated through the hospital value-based 

11 purchasing program; and 

12 (iv) any other area determined appro13 priate by the Secretary. 

14 (B) REPORT.—Not later than January 1, 

15 2016, the Secretary of Health and Human 

16 Services shall submit to Congress a report con17 taining the results of the study conducted under 

18 subparagraph (A), together with recommenda19 tions for such legislation and administrative ac20 tion as the Secretary determines appropriate. 

21 (b) VALUE-BASED PURCHASING DEMONSTRATION

22 PROGRAMS.— 

23 (1) VALUE-BASED PURCHASING DEMONSTRA24 TION PROGRAM FOR INPATIENT CRITICAL ACCESS

25 HOSPITALS.— 


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1 (A) ESTABLISHMENT.— 

2 (i) IN GENERAL.—Not later than 2 

3 years after the date of enactment of this 

4 Act, the Secretary of Health and Human 

5 Services (in this subsection referred to as 

6 the ‘‘Secretary’’) shall establish a dem7 onstration program under which the Sec8 retary establishes a value-based purchasing 

9 program under the Medicare program 

10 under title XVIII of the Social Security 

11 Act for critical access hospitals (as defined 

12 in paragraph (1) of section 1861(mm) of 

13 such Act (42 U.S.C. 1395x(mm))) with re14 spect to inpatient critical access hospital 

15 services (as defined in paragraph (2) of 

16 such section) in order to test innovative 

17 methods of measuring and rewarding qual18 ity and efficient health care furnished by 

19 such hospitals. 

20 (ii) DURATION.—The demonstration 

21 program under this paragraph shall be 

22 conducted for a 3-year period. 

23 (iii) SITES.—The Secretary shall con24 duct the demonstration program under this 

25 paragraph at an appropriate number (as 


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1 determined by the Secretary) of critical ac2 cess hospitals. The Secretary shall ensure 

3 that such hospitals are representative of 

4 the spectrum of such hospitals that partici5 pate in the Medicare program. 

6 (B) WAIVER AUTHORITY.—The Secretary 

7 may waive such requirements of titles XI and 

8 XVIII of the Social Security Act as may be nec9 essary to carry out the demonstration program 

10 under this paragraph. 

11 (C) BUDGET NEUTRALITY REQUIRE12 MENT.—In conducting the demonstration pro13 gram under this section, the Secretary shall en14 sure that the aggregate payments made by the 

15 Secretary do not exceed the amount which the 

16 Secretary would have paid if the demonstration 

17 program under this section was not imple18 mented. 

19 (D) REPORT.—Not later than 18 months 

20 after the completion of the demonstration pro21 gram under this paragraph, the Secretary shall 

22 submit to Congress a report on the demonstra23 tion program together with— 

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1 chasing program under the Medicare pro2 gram for critical access hospitals with re3 spect to inpatient critical access hospital 

4 services; and 

5 (ii) recommendations for such other 

6 legislation and administrative action as the 

7 Secretary determines appropriate. 

8 (2) VALUE-BASED PURCHASING DEMONSTRA9 TION PROGRAM FOR HOSPITALS EXCLUDED FROM

10 HOSPITAL VALUE-BASED PURCHASING PROGRAM AS

11 A RESULT OF INSUFFICIENT NUMBERS OF MEAS12 URES AND CASES.— 

13 (A) ESTABLISHMENT.— 

14 (i) IN GENERAL.—Not later than 2 

15 years after the date of enactment of this 

16 Act, the Secretary shall establish a dem17 onstration program under which the Sec18 retary establishes a value-based purchasing 

19 program under the Medicare program 

20 under title XVIII of the Social Security 

21 Act for applicable hospitals (as defined in 

22 clause (ii)) with respect to inpatient hos23 pital services (as defined in section 

24 1861(b) of the Social Security Act (42 

25 U.S.C. 1395x(b))) in order to test innovaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00649 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tive methods of measuring and rewarding 

2 quality and efficient health care furnished 

3 by such hospitals. 

4 (ii) APPLICABLE HOSPITAL DE5 FINED.—For purposes of this paragraph, 

6 the term ‘‘applicable hospital’’ means a 

7 hospital described in subclause (III) or 

8 (IV) of section 1886(o)(1)(C)(ii) of the So9 cial Security Act, as added by subsection 

10 (a)(1). 

11 (iii) DURATION.—The demonstration 

12 program under this paragraph shall be 

13 conducted for a 3-year period. 

14 (iv) SITES.—The Secretary shall con15 duct the demonstration program under this 

16 paragraph at an appropriate number (as 

17 determined by the Secretary) of applicable 

18 hospitals. The Secretary shall ensure that 

19 such hospitals are representative of the 

20 spectrum of such hospitals that participate 

21 in the Medicare program. 

22 (B) WAIVER AUTHORITY.—The Secretary 

23 may waive such requirements of titles XI and 

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1 essary to carry out the demonstration program 

2 under this paragraph. 

3 (C) BUDGET NEUTRALITY REQUIRE4 MENT.—In conducting the demonstration pro5 gram under this section, the Secretary shall en6 sure that the aggregate payments made by the 

7 Secretary do not exceed the amount which the 

8 Secretary would have paid if the demonstration 

9 program under this section was not imple10 mented. 

11 (D) REPORT.—Not later than 18 months 

12 after the completion of the demonstration pro13 gram under this paragraph, the Secretary shall 

14 submit to Congress a report on the demonstra15 tion program together with— 

16 (i) recommendations on the establish17 ment of a permanent value-based pur18 chasing program under the Medicare pro19 gram for applicable hospitals with respect 

20 to inpatient hospital services; and 

21 (ii) recommendations for such other 

22 legislation and administrative action as the 

23 Secretary determines appropriate. 


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1 SEC. 3002. IMPROVEMENTS TO THE PHYSICIAN QUALITY 

2 REPORTING SYSTEM. 

3 (a) EXTENSION.—Section 1848(m) of the Social Se4 curity Act (42 U.S.C. 1395w–4(m)) is amended— 

5 (1) in paragraph (1)— 

6 (A) in subparagraph (A), in the matter 

7 preceding clause (i), by striking ‘‘2010’’ and in8 serting ‘‘2014’’; and 

9 (B) in subparagraph (B)— 

10 (i) in clause (i), by striking ‘‘and’’ at 

11 the end; 

12 (ii) in clause (ii), by striking the pe13 riod at the end and inserting a semicolon; 

14 and 

15 (iii) by adding at the end the fol16 lowing new clauses: 

17 ‘‘(iii) for 2011, 1.0 percent; and 

18 ‘‘(iv) for 2012, 2013, and 2014, 0.5 

19 percent.’’; 

20 (2) in paragraph (3)— 

21 (A) in subparagraph (A), in the matter 

22 preceding clause (i), by inserting ‘‘(or, for pur23 poses of subsection (a)(8), for the quality re24 porting period for the year)’’ after ‘‘reporting 

25 period’’; and 


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1 (B) in subparagraph (C)(i), by inserting ‘‘, 

2 or, for purposes of subsection (a)(8), for a qual3 ity reporting period for the year’’ after ‘‘(a)(5), 

4 for a reporting period for a year’’; 

5 (3) in paragraph (5)(E)(iv), by striking ‘‘sub6 section (a)(5)(A)’’ and inserting ‘‘paragraphs (5)(A) 

7 and (8)(A) of subsection (a)’’; and 

8 (4) in paragraph (6)(C)— 

9 (A) in clause (i)(II), by striking ‘‘, 2009, 

10 2010, and 2011’’ and inserting ‘‘and subse11 quent years’’; and 

12 (B) in clause (iii)— 

13 (i) by inserting ‘‘(a)(8)’’ after 

14 ‘‘(a)(5)’’; and 

15 (ii) by striking ‘‘under subparagraph 

16 (D)(iii) of such subsection’’ and inserting 

17 ‘‘under subsection (a)(5)(D)(iii) or the 

18 quality reporting period under subsection 

19 (a)(8)(D)(iii), respectively’’. 

20 (b) INCENTIVE PAYMENT ADJUSTMENT FOR QUAL21 ITY REPORTING.—Section 1848(a) of the Social Security 

22 Act (42 U.S.C. 1395w–4(a)) is amended by adding at the 

23 end the following new paragraph: 

24 ‘‘(8) INCENTIVES FOR QUALITY REPORTING.— 

25 ‘‘(A) ADJUSTMENT.— 


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1 ‘‘(i) IN GENERAL.—With respect to 

2 covered professional services furnished by 

3 an eligible professional during 2015 or any 

4 subsequent year, if the eligible professional 

5 does not satisfactorily submit data on qual6 ity measures for covered professional serv7 ices for the quality reporting period for the 

8 year (as determined under subsection 

9 (m)(3)(A)), the fee schedule amount for 

10 such services furnished by such profes11 sional during the year (including the fee 

12 schedule amount for purposes of deter13 mining a payment based on such amount) 

14 shall be equal to the applicable percent of 

15 the fee schedule amount that would other16 wise apply to such services under this sub17 section (determined after application of 

18 paragraphs (3), (5), and (7), but without 

19 regard to this paragraph). 

20 ‘‘(ii) APPLICABLE PERCENT.—For 

21 purposes of clause (i), the term ‘applicable 

22 percent’ means— 

23 ‘‘(I) for 2015, 98.5 percent; and 

24 ‘‘(II) for 2016 and each subse25 quent year, 98 percent. 


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1 ‘‘(B) APPLICATION.— 

2 ‘‘(i) PHYSICIAN REPORTING SYSTEM

3 RULES.—Paragraphs (5), (6), and (8) of 

4 subsection (k) shall apply for purposes of 

5 this paragraph in the same manner as they 

6 apply for purposes of such subsection. 

7 ‘‘(ii) INCENTIVE PAYMENT VALIDA8 TION RULES.—Clauses (ii) and (iii) of sub9 section (m)(5)(D) shall apply for purposes 

10 of this paragraph in a similar manner as 

11 they apply for purposes of such subsection. 

12 ‘‘(C) DEFINITIONS.—For purposes of this 

13 paragraph: 

14 ‘‘(i) ELIGIBLE PROFESSIONAL; COV15 ERED PROFESSIONAL SERVICES.—The 

16 terms ‘eligible professional’ and ‘covered 

17 professional services’ have the meanings 

18 given such terms in subsection (k)(3). 

19 ‘‘(ii) PHYSICIAN REPORTING SYS20 TEM.—The term ‘physician reporting sys21 tem’ means the system established under 

22 subsection (k). 

23 ‘‘(iii) QUALITY REPORTING PERIOD.— 

24 The term ‘quality reporting period’ means, 


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1 with respect to a year, a period specified 

2 by the Secretary.’’. 

3 (c) MAINTENANCE OF CERTIFICATION PROGRAMS.— 

4 (1) IN GENERAL.—Section 1848(k)(4) of the 

5 Social Security Act (42 U.S.C. 1395w–4(k)(4)) is 

6 amended by inserting ‘‘or through a Maintenance of 

7 Certification program operated by a specialty body 

8 of the American Board of Medical Specialties that 

9 meets the criteria for such a registry’’ after ‘‘Data10 base)’’. 

11 (2) EFFECTIVE DATE.—The amendment made 

12 by paragraph (1) shall apply for years after 2010. 

13 (d) INTEGRATION OF PHYSICIAN QUALITY REPORT14 ING AND EHR REPORTING.—Section 1848(m) of the So15 cial Security Act (42 U.S.C. 1395w–4(m)) is amended by 

16 adding at the end the following new paragraph: 

17 ‘‘(7) INTEGRATION OF PHYSICIAN QUALITY RE18 PORTING AND EHR REPORTING.—Not later than 

19 January 1, 2012, the Secretary shall develop a plan 

20 to integrate reporting on quality measures under 

21 this subsection with reporting requirements under 

22 subsection (o) relating to the meaningful use of elec23 tronic health records. Such integration shall consist 

24 of the following: 


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1 ‘‘(A) The selection of measures, the report2 ing of which would both demonstrate— 

3 ‘‘(i) meaningful use of an electronic 

4 health record for purposes of subsection 

5 (o); and 

6 ‘‘(ii) quality of care furnished to an 

7 individual. 

8 ‘‘(B) Such other activities as specified by 

9 the Secretary.’’. 

10 (e) FEEDBACK.—Section 1848(m)(5) of the Social 

11 Security Act (42 U.S.C. 1395w–4(m)(5)) is amended by 

12 adding at the end the following new subparagraph: 

13 ‘‘(H) FEEDBACK.—The Secretary shall 

14 provide timely feedback to eligible professionals 

15 on the performance of the eligible professional 

16 with respect to satisfactorily submitting data on 

17 quality measures under this subsection.’’. 

18 (f) APPEALS.—Such section is further amended— 

19 (1) in subparagraph (E), by striking ‘‘There 

20 shall’’ and inserting ‘‘Except as provided in subpara21 graph (I), there shall’’; and 

22 (2) by adding at the end the following new sub23 paragraph: 

24 ‘‘(I) INFORMAL APPEALS PROCESS.—The 

25 Secretary shall, by not later than January 1, 


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1 2011, establish and have in place an informal 

2 process for eligible professionals to seek a re3 view of the determination that an eligible pro4 fessional did not satisfactorily submit data on 

5 quality measures under this subsection.’’. 

6 SEC. 3003. IMPROVEMENTS TO THE PHYSICIAN FEEDBACK 

7 PROGRAM. 

8 (a) IN GENERAL.—Section 1848(n) of the Social Se9 curity Act (42 U.S.C. 1395w–4(n)) is amended— 

10 (1) in paragraph (1)— 

11 (A) in subparagraph (A)— 

12 (i) by striking ‘‘GENERAL.—The Sec13 retary’’ and inserting ‘‘GENERAL.— 

14 ‘‘(i) ESTABLISHMENT.—The Sec15 retary’’; 

16 (ii) in clause (i), as added by clause 

17 (i), by striking ‘‘the ‘Program’)’’ and all 

18 that follows through the period at the end 

19 of the second sentence and inserting ‘‘the 

20 ‘Program’).’’; and 

21 (iii) by adding at the end the fol22 lowing new clauses: 

23 ‘‘(ii) REPORTS ON RESOURCES.—The 

24 Secretary shall use claims data under this 

25 title (and may use other data) to provide 


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1 confidential reports to physicians (and, as 

2 determined appropriate by the Secretary, 

3 to groups of physicians) that measure the 

4 resources involved in furnishing care to in5 dividuals under this title. 

6 ‘‘(iii) INCLUSION OF CERTAIN INFOR7 MATION.—If determined appropriate by 

8 the Secretary, the Secretary may include 

9 information on the quality of care fur10 nished to individuals under this title by the 

11 physician (or group of physicians) in such 

12 reports.’’; and 

13 (B) in subparagraph (B), by striking ‘‘sub14 paragraph (A)’’ and inserting ‘‘subparagraph 

15 (A)(ii)’’; 

16 (2) in paragraph (4)— 

17 (A) in the heading, by inserting ‘‘INITIAL’’ 

18 after ‘‘FOCUS’’; and 

19 (B) in the matter preceding subparagraph 

20 (A), by inserting ‘‘initial’’ after ‘‘focus the’’; 

21 (3) in paragraph (6), by adding at the end the 

22 following new sentence: ‘‘For adjustments for re23 ports on utilization under paragraph (9), see sub24 paragraph (D) of such paragraph.’’; and 


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1 (4) by adding at the end the following new 

2 paragraphs: 

3 ‘‘(9) REPORTS ON UTILIZATION.— 

4 ‘‘(A) DEVELOPMENT OF EPISODE GROUP5 ER.— 

6 ‘‘(i) IN GENERAL.—The Secretary 

7 shall develop an episode grouper that com8 bines separate but clinically related items 

9 and services into an episode of care for an 

10 individual, as appropriate. 

11 ‘‘(ii) TIMELINE FOR DEVELOP12 MENT.—The episode grouper described in 

13 subparagraph (A) shall be developed by not 

14 later than January 1, 2012. 

15 ‘‘(iii) PUBLIC AVAILABILITY.—The 

16 Secretary shall make the details of the epi17 sode grouper described in subparagraph 

18 (A) available to the public. 

19 ‘‘(iv) ENDORSEMENT.—The Secretary 

20 shall seek endorsement of the episode 

21 grouper described in subparagraph (A) by 

22 the entity with a contract under section 

23 1890(a). 

24 ‘‘(B) REPORTS ON UTILIZATION.—Effec25 tive beginning with 2012, the Secretary shall 


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1 provide reports to physicians that compare, as 

2 determined appropriate by the Secretary, pat3 terns of resource use of the individual physician 

4 to such patterns of other physicians. 

5 ‘‘(C) ANALYSIS OF DATA.—The Secretary 

6 shall, for purposes of preparing reports under 

7 this paragraph, establish methodologies as ap8 propriate, such as to— 

9 ‘‘(i) attribute episodes of care, in 

10 whole or in part, to physicians; 

11 ‘‘(ii) identify appropriate physicians 

12 for purposes of comparison under subpara13 graph (B); and 

14 ‘‘(iii) aggregate episodes of care at15 tributed to a physician under clause (i) 

16 into a composite measure per individual. 

17 ‘‘(D) DATA ADJUSTMENT.—In preparing 

18 reports under this paragraph, the Secretary 

19 shall make appropriate adjustments, including 

20 adjustments— 

21 ‘‘(i) to account for differences in so22 cioeconomic and demographic characteris23 tics, ethnicity, and health status of individ24 uals (such as to recognize that less healthy 


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1 individuals may require more intensive 

2 interventions); and 

3 ‘‘(ii) to eliminate the effect of geo4 graphic adjustments in payment rates (as 

5 described in subsection (e)). 

6 ‘‘(E) PUBLIC AVAILABILITY OF METHOD7 OLOGY.—The Secretary shall make available to 

8 the public— 

9 ‘‘(i) the methodologies established 

10 under subparagraph (C); 

11 ‘‘(ii) information regarding any ad12 justments made to data under subpara13 graph (D); and 

14 ‘‘(iii) aggregate reports with respect 

15 to physicians. 

16 ‘‘(F) DEFINITION OF PHYSICIAN.—In this 

17 paragraph: 

18 ‘‘(i) IN GENERAL.—The term ‘physi19 cian’ has the meaning given that term in 

20 section 1861(r)(1). 

21 ‘‘(ii) TREATMENT OF GROUPS.—Such 

22 term includes, as the Secretary determines 

23 appropriate, a group of physicians. 

24 ‘‘(G) LIMITATIONS ON REVIEW.—There 

25 shall be no administrative or judicial review 


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1 under section 1869, section 1878, or otherwise 

2 of the establishment of the methodology under 

3 subparagraph (C), including the determination 

4 of an episode of care under such methodology. 

5 ‘‘(10) COORDINATION WITH OTHER VALUE6 BASED PURCHASING REFORMS.—The Secretary shall 

7 coordinate the Program with the value-based pay8 ment modifier established under subsection (p) and, 

9 as the Secretary determines appropriate, other simi10 lar provisions of this title.’’. 

11 (b) CONFORMING AMENDMENT.—Section 1890(b) of 

12 the Social Security Act (42 U.S.C. 1395aaa(b)) is amend13 ed by adding at the end the following new paragraph: 

14 ‘‘(6) REVIEW AND ENDORSEMENT OF EPISODE

15 GROUPER UNDER THE PHYSICIAN FEEDBACK PRO16 GRAM.—The entity shall provide for the review and, 

17 as appropriate, the endorsement of the episode 

18 grouper developed by the Secretary under section 

19 1848(n)(9)(A). Such review shall be conducted on an 

20 expedited basis.’’. 

21 SEC. 3004. QUALITY REPORTING FOR LONG-TERM CARE 

22 HOSPITALS, INPATIENT REHABILITATION 

23 HOSPITALS, AND HOSPICE PROGRAMS. 

24 (a) LONG-TERM CARE HOSPITALS.—Section 

25 1886(m) of the Social Security Act (42 U.S.C. 


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1 1395ww(m)), as amended by section 3401(c), is amended 

2 by adding at the end the following new paragraph: 

3 ‘‘(5) QUALITY REPORTING.— 

4 ‘‘(A) REDUCTION IN UPDATE FOR FAILURE

5 TO REPORT.— 

6 ‘‘(i) IN GENERAL.—Under the system 

7 described in paragraph (1), for rate year 

8 2014 and each subsequent rate year, in the 

9 case of a long-term care hospital that does 

10 not submit data to the Secretary in accord11 ance with subparagraph (C) with respect 

12 to such a rate year, any annual update to 

13 a standard Federal rate for discharges for 

14 the hospital during the rate year, and after 

15 application of paragraph (3), shall be re16 duced by 2 percentage points. 

17 ‘‘(ii) SPECIAL RULE.—The application 

18 of this subparagraph may result in such 

19 annual update being less than 0.0 for a 

20 rate year, and may result in payment rates 

21 under the system described in paragraph 

22 (1) for a rate year being less than such 

23 payment rates for the preceding rate year. 

24 ‘‘(B) NONCUMULATIVE APPLICATION.— 

25 Any reduction under subparagraph (A) shall 


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1 apply only with respect to the rate year involved 

2 and the Secretary shall not take into account 

3 such reduction in computing the payment 

4 amount under the system described in para5 graph (1) for a subsequent rate year. 

6 ‘‘(C) SUBMISSION OF QUALITY DATA.—For 

7 rate year 2014 and each subsequent rate year, 

8 each long-term care hospital shall submit to the 

9 Secretary data on quality measures specified 

10 under subparagraph (D). Such data shall be 

11 submitted in a form and manner, and at a time, 

12 specified by the Secretary for purposes of this 

13 subparagraph. 

14 ‘‘(D) QUALITY MEASURES.— 

15 ‘‘(i) IN GENERAL.—Subject to clause 

16 (ii), any measure specified by the Secretary 

17 under this subparagraph must have been 

18 endorsed by the entity with a contract 

19 under section 1890(a). 

20 ‘‘(ii) EXCEPTION.—In the case of a 

21 specified area or medical topic determined 

22 appropriate by the Secretary for which a 

23 feasible and practical measure has not 

24 been endorsed by the entity with a contract 

25 under section 1890(a), the Secretary may 


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1 specify a measure that is not so endorsed 

2 as long as due consideration is given to 

3 measures that have been endorsed or 

4 adopted by a consensus organization iden5 tified by the Secretary. 

6 ‘‘(iii) TIME FRAME.—Not later than 

7 October 1, 2012, the Secretary shall pub8 lish the measures selected under this sub9 paragraph that will be applicable with re10 spect to rate year 2014. 

11 ‘‘(E) PUBLIC AVAILABILITY OF DATA SUB12 MITTED.—The Secretary shall establish proce13 dures for making data submitted under sub14 paragraph (C) available to the public. Such pro15 cedures shall ensure that a long-term care hos16 pital has the opportunity to review the data 

17 that is to be made public with respect to the 

18 hospital prior to such data being made public. 

19 The Secretary shall report quality measures 

20 that relate to services furnished in inpatient 

21 settings in long-term care hospitals on the 

22 Internet website of the Centers for Medicare & 

23 Medicaid Services.’’. 


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1 (b) INPATIENT REHABILITATION HOSPITALS.—Sec2 tion 1886(j) of the Social Security Act (42 U.S.C. 

3 1395ww(j)) is amended— 

4 (1) by redesignating paragraph (7) as para5 graph (8); and 

6 (2) by inserting after paragraph (6) the fol7 lowing new paragraph: 

8 ‘‘(7) QUALITY REPORTING.— 

9 ‘‘(A) REDUCTION IN UPDATE FOR FAILURE

10 TO REPORT.— 

11 ‘‘(i) IN GENERAL.—For purposes of 

12 fiscal year 2014 and each subsequent fiscal 

13 year, in the case of a rehabilitation facility 

14 that does not submit data to the Secretary 

15 in accordance with subparagraph (C) with 

16 respect to such a fiscal year, after deter17 mining the increase factor described in 

18 paragraph (3)(C), and after application of 

19 paragraph (3)(D), the Secretary shall re20 duce such increase factor for payments for 

21 discharges occurring during such fiscal 

22 year by 2 percentage points. 

23 ‘‘(ii) SPECIAL RULE.—The application 

24 of this subparagraph may result in the in25 crease factor described in paragraph (3)(C) 


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1 being less than 0.0 for a fiscal year, and 

2 may result in payment rates under this 

3 subsection for a fiscal year being less than 

4 such payment rates for the preceding fiscal 

5 year. 

6 ‘‘(B) NONCUMULATIVE APPLICATION.— 

7 Any reduction under subparagraph (A) shall 

8 apply only with respect to the fiscal year in9 volved and the Secretary shall not take into ac10 count such reduction in computing the payment 

11 amount under this subsection for a subsequent 

12 fiscal year. 

13 ‘‘(C) SUBMISSION OF QUALITY DATA.—For 

14 fiscal year 2014 and each subsequent rate year, 

15 each rehabilitation facility shall submit to the 

16 Secretary data on quality measures specified 

17 under subparagraph (D). Such data shall be 

18 submitted in a form and manner, and at a time, 

19 specified by the Secretary for purposes of this 

20 subparagraph. 

21 ‘‘(D) QUALITY MEASURES.— 

22 ‘‘(i) IN GENERAL.—Subject to clause 

23 (ii), any measure specified by the Secretary 

24 under this subparagraph must have been 


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1 endorsed by the entity with a contract 

2 under section 1890(a). 

3 ‘‘(ii) EXCEPTION.—In the case of a 

4 specified area or medical topic determined 

5 appropriate by the Secretary for which a 

6 feasible and practical measure has not 

7 been endorsed by the entity with a contract 

8 under section 1890(a), the Secretary may 

9 specify a measure that is not so endorsed 

10 as long as due consideration is given to 

11 measures that have been endorsed or 

12 adopted by a consensus organization iden13 tified by the Secretary. 

14 ‘‘(iii) TIME FRAME.—Not later than 

15 October 1, 2012, the Secretary shall pub16 lish the measures selected under this sub17 paragraph that will be applicable with re18 spect to fiscal year 2014. 

19 ‘‘(E) PUBLIC AVAILABILITY OF DATA SUB20 MITTED.—The Secretary shall establish proce21 dures for making data submitted under sub22 paragraph (C) available to the public. Such pro23 cedures shall ensure that a rehabilitation facil24 ity has the opportunity to review the data that 

25 is to be made public with respect to the facility 


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1 prior to such data being made public. The Sec2 retary shall report quality measures that relate 

3 to services furnished in inpatient settings in re4 habilitation facilities on the Internet website of 

5 the Centers for Medicare & Medicaid Services.’’. 

6 (c) HOSPICE PROGRAMS.—Section 1814(i) of the So7 cial Security Act (42 U.S.C. 1395f(i)) is amended— 

8 (1) by redesignating paragraph (5) as para9 graph (6); and 

10 (2) by inserting after paragraph (4) the fol11 lowing new paragraph: 

12 ‘‘(5) QUALITY REPORTING.— 

13 ‘‘(A) REDUCTION IN UPDATE FOR FAILURE

14 TO REPORT.— 

15 ‘‘(i) IN GENERAL.—For purposes of 

16 fiscal year 2014 and each subsequent fiscal 

17 year, in the case of a hospice program that 

18 does not submit data to the Secretary in 

19 accordance with subparagraph (C) with re20 spect to such a fiscal year, after deter21 mining the market basket percentage in22 crease under paragraph (1)(C)(ii)(VII) or 

23 paragraph (1)(C)(iii), as applicable, and 

24 after application of paragraph (1)(C)(iv), 

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1 retary shall reduce such market basket 

2 percentage increase by 2 percentage points. 

3 ‘‘(ii) SPECIAL RULE.—The application 

4 of this subparagraph may result in the 

5 market basket percentage increase under 

6 paragraph (1)(C)(ii)(VII) or paragraph 

7 (1)(C)(iii), as applicable, being less than 

8 0.0 for a fiscal year, and may result in 

9 payment rates under this subsection for a 

10 fiscal year being less than such payment 

11 rates for the preceding fiscal year. 

12 ‘‘(B) NONCUMULATIVE APPLICATION.— 

13 Any reduction under subparagraph (A) shall 

14 apply only with respect to the fiscal year in15 volved and the Secretary shall not take into ac16 count such reduction in computing the payment 

17 amount under this subsection for a subsequent 

18 fiscal year. 

19 ‘‘(C) SUBMISSION OF QUALITY DATA.—For 

20 fiscal year 2014 and each subsequent fiscal 

21 year, each hospice program shall submit to the 

22 Secretary data on quality measures specified 

23 under subparagraph (D). Such data shall be 

24 submitted in a form and manner, and at a time, 


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1 specified by the Secretary for purposes of this 

2 subparagraph. 

3 ‘‘(D) QUALITY MEASURES.— 

4 ‘‘(i) IN GENERAL.—Subject to clause 

5 (ii), any measure specified by the Secretary 

6 under this subparagraph must have been 

7 endorsed by the entity with a contract 

8 under section 1890(a). 

9 ‘‘(ii) EXCEPTION.—In the case of a 

10 specified area or medical topic determined 

11 appropriate by the Secretary for which a 

12 feasible and practical measure has not 

13 been endorsed by the entity with a contract 

14 under section 1890(a), the Secretary may 

15 specify a measure that is not so endorsed 

16 as long as due consideration is given to 

17 measures that have been endorsed or 

18 adopted by a consensus organization iden19 tified by the Secretary. 

20 ‘‘(iii) TIME FRAME.—Not later than 

21 October 1, 2012, the Secretary shall pub22 lish the measures selected under this sub23 paragraph that will be applicable with re24 spect to fiscal year 2014. 


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1 ‘‘(E) PUBLIC AVAILABILITY OF DATA SUB2 MITTED.—The Secretary shall establish proce3 dures for making data submitted under sub4 paragraph (C) available to the public. Such pro5 cedures shall ensure that a hospice program has 

6 the opportunity to review the data that is to be 

7 made public with respect to the hospice pro8 gram prior to such data being made public. The 

9 Secretary shall report quality measures that re10 late to hospice care provided by hospice pro11 grams on the Internet website of the Centers 

12 for Medicare & Medicaid Services.’’. 

13 SEC. 3005. QUALITY REPORTING FOR PPS-EXEMPT CANCER 

14 HOSPITALS. 

15 Section 1866 of the Social Security Act (42 U.S.C. 

16 1395cc) is amended— 

17 (1) in subsection (a)(1)— 

18 (A) in subparagraph (U), by striking 

19 ‘‘and’’ at the end; 

20 (B) in subparagraph (V), by striking the 

21 period at the end and inserting ‘‘, and’’; and 

22 (C) by adding at the end the following new 

23 subparagraph: 

24 ‘‘(W) in the case of a hospital described in 

25 section 1886(d)(1)(B)(v), to report quality data 


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1 to the Secretary in accordance with subsection 

2 (k).’’; and 

3 (2) by adding at the end the following new sub4 section: 

5 ‘‘(k) QUALITY REPORTING BY CANCER HOS6 PITALS.— 

7 ‘‘(1) IN GENERAL.—For purposes of fiscal year 

8 2014 and each subsequent fiscal year, a hospital de9 scribed in section 1886(d)(1)(B)(v) shall submit 

10 data to the Secretary in accordance with paragraph 

11 (2) with respect to such a fiscal year. 

12 ‘‘(2) SUBMISSION OF QUALITY DATA.—For fis13 cal year 2014 and each subsequent fiscal year, each 

14 hospital described in such section shall submit to the 

15 Secretary data on quality measures specified under 

16 paragraph (3). Such data shall be submitted in a 

17 form and manner, and at a time, specified by the 

18 Secretary for purposes of this subparagraph. 

19 ‘‘(3) QUALITY MEASURES.— 

20 ‘‘(A) IN GENERAL.—Subject to subpara21 graph (B), any measure specified by the Sec22 retary under this paragraph must have been en23 dorsed by the entity with a contract under sec24 tion 1890(a). 


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1 ‘‘(B) EXCEPTION.—In the case of a speci2 fied area or medical topic determined appro3 priate by the Secretary for which a feasible and 

4 practical measure has not been endorsed by the 

5 entity with a contract under section 1890(a), 

6 the Secretary may specify a measure that is not 

7 so endorsed as long as due consideration is 

8 given to measures that have been endorsed or 

9 adopted by a consensus organization identified 

10 by the Secretary. 

11 ‘‘(C) TIME FRAME.—Not later than Octo12 ber 1, 2012, the Secretary shall publish the 

13 measures selected under this paragraph that 

14 will be applicable with respect to fiscal year 

15 2014. 

16 ‘‘(4) PUBLIC AVAILABILITY OF DATA SUB17 MITTED.—The Secretary shall establish procedures 

18 for making data submitted under paragraph (4) 

19 available to the public. Such procedures shall ensure 

20 that a hospital described in section 1886(d)(1)(B)(v) 

21 has the opportunity to review the data that is to be 

22 made public with respect to the hospital prior to 

23 such data being made public. The Secretary shall re24 port quality measures of process, structure, outcome, 

25 patients’ perspective on care, efficiency, and costs of 


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1 care that relate to services furnished in such hos2 pitals on the Internet website of the Centers for 

3 Medicare & Medicaid Services.’’. 

4 SEC. 3006. PLANS FOR A VALUE-BASED PURCHASING PRO5 GRAM FOR SKILLED NURSING FACILITIES 

6 AND HOME HEALTH AGENCIES. 

7 (a) SKILLED NURSING FACILITIES.— 

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

9 Human Services (in this section referred to as the 

10 ‘‘Secretary’’) shall develop a plan to implement a 

11 value-based purchasing program for payments under 

12 the Medicare program under title XVIII of the So13 cial Security Act for skilled nursing facilities (as de14 fined in section 1819(a) of such Act (42 U.S.C. 

15 1395i–3(a))). 

16 (2) DETAILS.—In developing the plan under 

17 paragraph (1), the Secretary shall consider the fol18 lowing issues: 

19 (A) The ongoing development, selection, 

20 and modification process for measures (includ21 ing under section 1890 of the Social Security 

22 Act (42 U.S.C. 1395aaa) and section 1890A 

23 such Act, as added by section 3014), to the ex24 tent feasible and practicable, of all dimensions 


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1 of quality and efficiency in skilled nursing fa2 cilities. 

3 (i) IN GENERAL.—Subject to clause 

4 (ii), any measure specified by the Secretary 

5 under subparagraph (A)(iii) must have 

6 been endorsed by the entity with a contract 

7 under section 1890(a). 

8 (ii) EXCEPTION.—In the case of a 

9 specified area or medical topic determined 

10 appropriate by the Secretary for which a 

11 feasible and practical measure has not 

12 been endorsed by the entity with a contract 

13 under section 1890(a), the Secretary may 

14 specify a measure that is not so endorsed 

15 as long as due consideration is given to 

16 measures that have been endorsed or 

17 adopted by a consensus organization iden18 tified by the Secretary. 

19 (B) The reporting, collection, and valida20 tion of quality data. 

21 (C) The structure of value-based payment 

22 adjustments, including the determination of 

23 thresholds or improvements in quality that 

24 would substantiate a payment adjustment, the 


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1 size of such payments, and the sources of fund2 ing for the value-based bonus payments. 

3 (D) Methods for the public disclosure of 

4 information on the performance of skilled nurs5 ing facilities. 

6 (E) Any other issues determined appro7 priate by the Secretary. 

8 (3) CONSULTATION.—In developing the plan 

9 under paragraph (1), the Secretary shall— 

10 (A) consult with relevant affected parties; 

11 and 

12 (B) consider experience with such dem13 onstrations that the Secretary determines are 

14 relevant to the value-based purchasing program 

15 described in paragraph (1). 

16 (4) REPORT TO CONGRESS.—Not later than Oc17 tober 1, 2011, the Secretary shall submit to Con18 gress a report containing the plan developed under 

19 paragraph (1). 

20 (b) HOME HEALTH AGENCIES.— 

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

22 Human Services (in this section referred to as the 

23 ‘‘Secretary’’) shall develop a plan to implement a 

24 value-based purchasing program for payments under 

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1 cial Security Act for home health agencies (as de2 fined in section 1861(o) of such Act (42 U.S.C. 

3 1395x(o))). 

4 (2) DETAILS.—In developing the plan under 

5 paragraph (1), the Secretary shall consider the fol6 lowing issues: 

7 (A) The ongoing development, selection, 

8 and modification process for measures (includ9 ing under section 1890 of the Social Security 

10 Act (42 U.S.C. 1395aaa) and section 1890A 

11 such Act, as added by section 3014), to the ex12 tent feasible and practicable, of all dimensions 

13 of quality and efficiency in home health agen14 cies. 

15 (B) The reporting, collection, and valida16 tion of quality data. 

17 (C) The structure of value-based payment 

18 adjustments, including the determination of 

19 thresholds or improvements in quality that 

20 would substantiate a payment adjustment, the 

21 size of such payments, and the sources of fund22 ing for the value-based bonus payments. 

23 (D) Methods for the public disclosure of 

24 information on the performance of home health 

25 agencies. 


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1 (E) Any other issues determined appro2 priate by the Secretary. 

3 (3) CONSULTATION.—In developing the plan 

4 under paragraph (1), the Secretary shall— 

5 (A) consult with relevant affected parties; 

6 and 

7 (B) consider experience with such dem8 onstrations that the Secretary determines are 

9 relevant to the value-based purchasing program 

10 described in paragraph (1). 

11 (4) REPORT TO CONGRESS.—Not later than Oc12 tober 1, 2011, the Secretary shall submit to Con13 gress a report containing the plan developed under 

14 paragraph (1). 

15 SEC. 3007. VALUE-BASED PAYMENT MODIFIER UNDER THE 

16 PHYSICIAN FEE SCHEDULE. 

17 Section 1848 of the Social Security Act (42 U.S.C. 

18 1395w–4) is amended— 

19 (1) in subsection (b)(1), by inserting ‘‘subject 

20 to subsection (p),’’ after ‘‘1998,’’; and 

21 (2) by adding at the end the following new sub22 section: 

23 ‘‘(p) ESTABLISHMENT OF VALUE-BASED PAYMENT

24 MODIFIER.— 


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1 ‘‘(1) IN GENERAL.—The Secretary shall estab2 lish a payment modifier that provides for differential 

3 payment to a physician or a group of physicians 

4 under the fee schedule established under subsection 

5 (b) based upon the quality of care furnished com6 pared to cost (as determined under paragraphs (2) 

7 and (3), respectively) during a performance period. 

8 Such payment modifier shall be separate from the 

9 geographic adjustment factors established under 

10 subsection (e). 

11 ‘‘(2) QUALITY.— 

12 ‘‘(A) IN GENERAL.—For purposes of para13 graph (1), quality of care shall be evaluated, to 

14 the extent practicable, based on a composite of 

15 measures of the quality of care furnished (as 

16 established by the Secretary under subpara17 graph (B)). 

18 ‘‘(B) MEASURES.— 

19 ‘‘(i) The Secretary shall establish ap20 propriate measures of the quality of care 

21 furnished by a physician or group of physi22 cians to individuals enrolled under this 

23 part, such as measures that reflect health 

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1 justed as determined appropriate by the 

2 Secretary. 

3 ‘‘(ii) The Secretary shall seek endorse4 ment of the measures established under 

5 this subparagraph by the entity with a 

6 contract under section 1890(a). 

7 ‘‘(3) COSTS.—For purposes of paragraph (1), 

8 costs shall be evaluated, to the extent practicable, 

9 based on a composite of appropriate measures of 

10 costs established by the Secretary (such as the com11 posite measure under the methodology established 

12 under subsection (n)(9)(C)(iii)) that eliminate the 

13 effect of geographic adjustments in payment rates 

14 (as described in subsection (e)), and take into ac15 count risk factors (such as socioeconomic and demo16 graphic characteristics, ethnicity, and health status 

17 of individuals (such as to recognize that less healthy 

18 individuals may require more intensive interventions) 

19 and other factors determined appropriate by the 

20 Secretary. 

21 ‘‘(4) IMPLEMENTATION.— 

22 ‘‘(A) PUBLICATION OF MEASURES, DATES

23 OF IMPLEMENTATION, PERFORMANCE PE24 RIOD.—Not later than January 1, 2012, the 

25 Secretary shall publish the following: 


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1 ‘‘(i) The measures of quality of care 

2 and costs established under paragraphs (2) 

3 and (3), respectively. 

4 ‘‘(ii) The dates for implementation of 

5 the payment modifier (as determined under 

6 subparagraph (B)). 

7 ‘‘(iii) The initial performance period 

8 (as specified under subparagraph (B)(ii)). 

9 ‘‘(B) DEADLINES FOR IMPLEMENTA10 TION.— 

11 ‘‘(i) INITIAL IMPLEMENTATION.—Sub12 ject to the preceding provisions of this sub13 paragraph, the Secretary shall begin imple14 menting the payment modifier established 

15 under this subsection through the rule16 making process during 2013 for the physi17 cian fee schedule established under sub18 section (b). 

19 ‘‘(ii) INITIAL PERFORMANCE PE20 RIOD.— 

21 ‘‘(I) IN GENERAL.—The Sec22 retary shall specify an initial perform23 ance period for application of the pay24 ment modifier established under this 

25 subsection with respect to 2015. 


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1 ‘‘(II) PROVISION OF INFORMA2 TION DURING INITIAL PERFORMANCE

3 PERIOD.—During the initial perform4 ance period, the Secretary shall, to 

5 the extent practicable, provide infor6 mation to physicians and groups of 

7 physicians about the quality of care 

8 furnished by the physician or group of 

9 physicians to individuals enrolled 

10 under this part compared to cost (as 

11 determined under paragraphs (2) and 

12 (3), respectively) with respect to the 

13 performance period. 

14 ‘‘(iii) APPLICATION.—The Secretary 

15 shall apply the payment modifier estab16 lished under this subsection for items and 

17 services furnished— 

18 ‘‘(I) beginning on January 1, 

19 2015, with respect to specific physi20 cians and groups of physicians the 

21 Secretary determines appropriate; and 

22 ‘‘(II) beginning not later than 

23 January 1, 2017, with respect to all 

24 physicians and groups of physicians. 


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1 ‘‘(C) BUDGET NEUTRALITY.—The pay2 ment modifier established under this subsection 

3 shall be implemented in a budget neutral man4 ner. 

5 ‘‘(5) SYSTEMS-BASED CARE.—The Secretary 

6 shall, as appropriate, apply the payment modifier es7 tablished under this subsection in a manner that 

8 promotes systems-based care. 

9 ‘‘(6) CONSIDERATION OF SPECIAL CIR10 CUMSTANCES OF CERTAIN PROVIDERS.—In applying 

11 the payment modifier under this subsection, the Sec12 retary shall, as appropriate, take into account the 

13 special circumstances of physicians or groups of phy14 sicians in rural areas and other underserved commu15 nities. 

16 ‘‘(7) APPLICATION.—For purposes of the initial 

17 application of the payment modifier established 

18 under this subsection during the period beginning on 

19 January 1, 2015, and ending on December 31, 

20 2016, the term ‘physician’ has the meaning given 

21 such term in section 1861(r). On or after January 

22 1, 2017, the Secretary may apply this subsection to 

23 eligible professionals (as defined in subsection 

24 (k)(3)(B)) as the Secretary determines appropriate. 


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1 ‘‘(8) DEFINITIONS.—For purposes of this sub2 section: 

3 ‘‘(A) COSTS.—The term ‘costs’ means ex4 penditures per individual as determined appro5 priate by the Secretary. In making the deter6 mination under the preceding sentence, the Sec7 retary may take into account the amount of 

8 growth in expenditures per individual for a phy9 sician compared to the amount of such growth 

10 for other physicians. 

11 ‘‘(B) PERFORMANCE PERIOD.—The term 

12 ‘performance period’ means a period specified 

13 by the Secretary. 

14 ‘‘(9) COORDINATION WITH OTHER VALUE15 BASED PURCHASING REFORMS.—The Secretary shall 

16 coordinate the value-based payment modifier estab17 lished under this subsection with the Physician 

18 Feedback Program under subsection (n) and, as the 

19 Secretary determines appropriate, other similar pro20 visions of this title. 

21 ‘‘(10) LIMITATIONS ON REVIEW.—There shall 

22 be no administrative or judicial review under section 

23 1869, section 1878, or otherwise of— 

24 ‘‘(A) the establishment of the value-based 

25 payment modifier under this subsection; 


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1 ‘‘(B) the evaluation of quality of care 

2 under paragraph (2), including the establish3 ment of appropriate measures of the quality of 

4 care under paragraph (2)(B); 

5 ‘‘(C) the evaluation of costs under para6 graph (3), including the establishment of appro7 priate measures of costs under such paragraph; 

8 ‘‘(D) the dates for implementation of the 

9 value-based payment modifier; 

10 ‘‘(E) the specification of the initial per11 formance period and any other performance pe12 riod under paragraphs (4)(B)(ii) and (8)(B), 

13 respectively; 

14 ‘‘(F) the application of the value-based 

15 payment modifier under paragraph (7); and 

16 ‘‘(G) the determination of costs under 

17 paragraph (8)(A).’’. 

18 SEC. 3008. PAYMENT ADJUSTMENT FOR CONDITIONS AC19 QUIRED IN HOSPITALS. 

20 (a) IN GENERAL.—Section 1886 of the Social Secu21 rity Act (42 U.S.C. 1395ww), as amended by section 

22 3001, is amended by adding at the end the following new 

23 subsection: 

24 ‘‘(p) ADJUSTMENT TO HOSPITAL PAYMENTS FOR

25 HOSPITAL ACQUIRED CONDITIONS.— 


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1 ‘‘(1) IN GENERAL.—In order to provide an in2 centive for applicable hospitals to reduce hospital ac3 quired conditions under this title, with respect to 

4 discharges from an applicable hospital occurring 

5 during fiscal year 2015 or a subsequent fiscal year, 

6 the amount of payment under this section or section 

7 1814(b)(3), as applicable, for such discharges during 

8 the fiscal year shall be equal to 99 percent of the 

9 amount of payment that would otherwise apply to 

10 such discharges under this section or section 

11 1814(b)(3) (determined after the application of sub12 sections (o) and (q) and section 1814(l)(4) but with13 out regard to this subsection). 

14 ‘‘(2) APPLICABLE HOSPITALS.— 

15 ‘‘(A) IN GENERAL.—For purposes of this 

16 subsection, the term ‘applicable hospital’ means 

17 a subsection (d) hospital that meets the criteria 

18 described in subparagraph (B). 

19 ‘‘(B) CRITERIA DESCRIBED.— 

20 ‘‘(i) IN GENERAL.—The criteria de21 scribed in this subparagraph, with respect 

22 to a subsection (d) hospital, is that the 

23 subsection (d) hospital is in the top quar24 tile of all subsection (d) hospitals, relative 

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1 quired conditions during the applicable pe2 riod, as determined by the Secretary. 

3 ‘‘(ii) RISK ADJUSTMENT.—In carrying 

4 out clause (i), the Secretary shall establish 

5 and apply an appropriate risk adjustment 

6 methodology. 

7 ‘‘(C) EXEMPTION.—In the case of a hos8 pital that is paid under section 1814(b)(3), the 

9 Secretary may exempt such hospital from the 

10 application of this subsection if the State which 

11 is paid under such section submits an annual 

12 report to the Secretary describing how a similar 

13 program in the State for a participating hos14 pital or hospitals achieves or surpasses the 

15 measured results in terms of patient health out16 comes and cost savings established under this 

17 subsection. 

18 ‘‘(3) HOSPITAL ACQUIRED CONDITIONS.—For 

19 purposes of this subsection, the term ‘hospital ac20 quired condition’ means a condition identified for 

21 purposes of subsection (d)(4)(D)(iv) and any other 

22 condition determined appropriate by the Secretary 

23 that an individual acquires during a stay in an ap24 plicable hospital, as determined by the Secretary. 


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1 ‘‘(4) APPLICABLE PERIOD.—In this subsection, 

2 the term ‘applicable period’ means, with respect to 

3 a fiscal year, a period specified by the Secretary. 

4 ‘‘(5) REPORTING TO HOSPITALS.—Prior to fis5 cal year 2015 and each subsequent fiscal year, the 

6 Secretary shall provide confidential reports to appli7 cable hospitals with respect to hospital acquired con8 ditions of the applicable hospital during the applica9 ble period. 

10 ‘‘(6) REPORTING HOSPITAL SPECIFIC INFORMA11 TION.— 

12 ‘‘(A) IN GENERAL.—The Secretary shall 

13 make information available to the public re14 garding hospital acquired conditions of each ap15 plicable hospital. 

16 ‘‘(B) OPPORTUNITY TO REVIEW AND SUB17 MIT CORRECTIONS.—The Secretary shall ensure 

18 that an applicable hospital has the opportunity 

19 to review, and submit corrections for, the infor20 mation to be made public with respect to the 

21 hospital under subparagraph (A) prior to such 

22 information being made public. 

23 ‘‘(C) WEBSITE.—Such information shall be 

24 posted on the Hospital Compare Internet 

25 website in an easily understandable format. 


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1 ‘‘(7) LIMITATIONS ON REVIEW.—There shall be 

2 no administrative or judicial review under section 

3 1869, section 1878, or otherwise of the following: 

4 ‘‘(A) The criteria described in paragraph 

5 (2)(A). 

6 ‘‘(B) The specification of hospital acquired 

7 conditions under paragraph (3). 

8 ‘‘(C) The specification of the applicable pe9 riod under paragraph (4). 

10 ‘‘(D) The provision of reports to applicable 

11 hospitals under paragraph (5) and the informa12 tion made available to the public under para13 graph (6).’’. 

14 (b) STUDY AND REPORT ON EXPANSION OF

15 HEALTHCARE ACQUIRED CONDITIONS POLICY TO OTHER

16 PROVIDERS.— 

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

18 Human Services shall conduct a study on expanding 

19 the healthcare acquired conditions policy under sub20 section (d)(4)(D) of section 1886 of the Social Secu21 rity Act (42 U.S.C. 1395ww) to payments made to 

22 other facilities under the Medicare program under 

23 title XVIII of the Social Security Act, including such 

24 payments made to inpatient rehabilitation facilities, 

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1 section(d)(1)(B)(iv) of such section), hospital out2 patient departments, and other hospitals excluded 

3 from the inpatient prospective payment system 

4 under such section, skilled nursing facilities, ambula5 tory surgical centers, and health clinics. Such study 

6 shall include an analysis of how such policies could 

7 impact quality of patient care, patient safety, and 

8 spending under the Medicare program. 

9 (2) REPORT.—Not later than January 1, 2012, 

10 the Secretary shall submit to Congress a report con11 taining the results of the study conducted under 

12 paragraph (1), together with recommendations for 

13 such legislation and administrative action as the 

14 Secretary determines appropriate. 

15 PART II—NATIONAL STRATEGY TO IMPROVE 

16 HEALTH CARE QUALITY 

17 SEC. 3011. NATIONAL STRATEGY. 

18 Title III of the Public Health Service Act (42 U.S.C. 

19 241 et seq.) is amended by adding at the end the fol20 lowing: 


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1 ‘‘PART S—HEALTH CARE QUALITY PROGRAMS 

2 ‘‘Subpart I—National Strategy for Quality 

3 Improvement in Health Care 

4 ‘‘SEC. 399HH. NATIONAL STRATEGY FOR QUALITY IM5 PROVEMENT IN HEALTH CARE. 

6 ‘‘(a) ESTABLISHMENT OF NATIONAL STRATEGY AND

7 PRIORITIES.— 

8 ‘‘(1) NATIONAL STRATEGY.—The Secretary, 

9 through a transparent collaborative process, shall es10 tablish a national strategy to improve the delivery of 

11 health care services, patient health outcomes, and 

12 population health. 

13 ‘‘(2) IDENTIFICATION OF PRIORITIES.— 

14 ‘‘(A) IN GENERAL.—The Secretary shall 

15 identify national priorities for improvement in 

16 developing the strategy under paragraph (1). 

17 ‘‘(B) REQUIREMENTS.—The Secretary 

18 shall ensure that priorities identified under sub19 paragraph (A) will— 

20 ‘‘(i) have the greatest potential for im21 proving the health outcomes, efficiency, 

22 and patient-centeredness of health care for 

23 all populations, including children and vul24 nerable populations; 

25 ‘‘(ii) identify areas in the delivery of 

26 health care services that have the potential 


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1 for rapid improvement in the quality and 

2 efficiency of patient care; 

3 ‘‘(iii) address gaps in quality, effi4 ciency, comparative effectiveness informa5 tion, and health outcomes measures and 

6 data aggregation techniques; 

7 ‘‘(iv) improve Federal payment policy 

8 to emphasize quality and efficiency; 

9 ‘‘(v) enhance the use of health care 

10 data to improve quality, efficiency, trans11 parency, and outcomes; 

12 ‘‘(vi) address the health care provided 

13 to patients with high-cost chronic diseases; 

14 ‘‘(vii) improve research and dissemi15 nation of strategies and best practices to 

16 improve patient safety and reduce medical 

17 errors, preventable admissions and re18 admissions, and health care-associated in19 fections; 

20 ‘‘(viii) reduce health disparities across 

21 health disparity populations (as defined in 

22 section 485E) and geographic areas; and 

23 ‘‘(ix) address other areas as deter24 mined appropriate by the Secretary. 


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1 ‘‘(C) CONSIDERATIONS.—In identifying 

2 priorities under subparagraph (A), the Sec3 retary shall take into consideration the rec4 ommendations submitted by the entity with a 

5 contract under section 1890(a) of the Social Se6 curity Act and other stakeholders. 

7 ‘‘(D) COORDINATION WITH STATE AGEN8 CIES.—The Secretary shall collaborate, coordi9 nate, and consult with State agencies respon10 sible for administering the Medicaid program 

11 under title XIX of the Social Security Act and 

12 the Children’s Health Insurance Program under 

13 title XXI of such Act with respect to developing 

14 and disseminating strategies, goals, models, and 

15 timetables that are consistent with the national 

16 priorities identified under subparagraph (A). 

17 ‘‘(b) STRATEGIC PLAN.— 

18 ‘‘(1) IN GENERAL.—The national strategy shall 

19 include a comprehensive strategic plan to achieve the 

20 priorities described in subsection (a). 

21 ‘‘(2) REQUIREMENTS.—The strategic plan shall 

22 include provisions for addressing, at a minimum, the 

23 following: 

24 ‘‘(A) Coordination among agencies within 

25 the Department, which shall include steps to 


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1 minimize duplication of efforts and utilization 

2 of common quality measures, where available. 

3 Such common quality measures shall be meas4 ures identified by the Secretary under section 

5 1139A or 1139B of the Social Security Act or 

6 endorsed under section 1890 of such Act. 

7 ‘‘(B) Agency-specific strategic plans to 

8 achieve national priorities. 

9 ‘‘(C) Establishment of annual benchmarks 

10 for each relevant agency to achieve national pri11 orities. 

12 ‘‘(D) A process for regular reporting by 

13 the agencies to the Secretary on the implemen14 tation of the strategic plan. 

15 ‘‘(E) Strategies to align public and private 

16 payers with regard to quality and patient safety 

17 efforts. 

18 ‘‘(F) Incorporating quality improvement 

19 and measurement in the strategic plan for 

20 health information technology required by the 

21 American Recovery and Reinvestment Act of 

22 2009 (Public Law 111–5). 

23 ‘‘(c) PERIODIC UPDATE OF NATIONAL STRATEGY.— 

24 The Secretary shall update the national strategy not less 


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1 than annually. Any such update shall include a review of 

2 short- and long-term goals. 

3 ‘‘(d) SUBMISSION AND AVAILABILITY OF NATIONAL

4 STRATEGY AND UPDATES.— 

5 ‘‘(1) DEADLINE FOR INITIAL SUBMISSION OF

6 NATIONAL STRATEGY.—Not later than January 1, 

7 2011, the Secretary shall submit to the relevant 

8 committees of Congress the national strategy de9 scribed in subsection (a). 

10 ‘‘(2) UPDATES.— 

11 ‘‘(A) IN GENERAL.—The Secretary shall 

12 submit to the relevant committees of Congress 

13 an annual update to the strategy described in 

14 paragraph (1). 

15 ‘‘(B) INFORMATION SUBMITTED.—Each 

16 update submitted under subparagraph (A) shall 

17 include— 

18 ‘‘(i) a review of the short- and long19 term goals of the national strategy and any 

20 gaps in such strategy; 

21 ‘‘(ii) an analysis of the progress, or 

22 lack of progress, in meeting such goals and 

23 any barriers to such progress; 

24 ‘‘(iii) the information reported under 

25 section 1139A of the Social Security Act, 


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1 consistent with the reporting requirements 

2 of such section; and 

3 ‘‘(iv) in the case of an update required 

4 to be submitted on or after January 1, 

5 2014, the information reported under sec6 tion 1139B(b)(4) of the Social Security 

7 Act, consistent with the reporting require8 ments of such section. 

9 ‘‘(C) SATISFACTION OF OTHER REPORTING

10 REQUIREMENTS.—Compliance with the require11 ments of clauses (iii) and (iv) of subparagraph 

12 (B) shall satisfy the reporting requirements 

13 under sections 1139A(a)(6) and 1139B(b)(4), 

14 respectively, of the Social Security Act. 

15 ‘‘(e) HEALTH CARE QUALITY INTERNET

16 WEBSITE.—Not later than January 1, 2011, the Sec17 retary shall create an Internet website to make public in18 formation regarding— 

19 ‘‘(1) the national priorities for health care qual20 ity improvement established under subsection (a)(2); 

21 ‘‘(2) the agency-specific strategic plans for 

22 health care quality described in subsection (b)(2)(B); 

23 and 

24 ‘‘(3) other information, as the Secretary deter25 mines to be appropriate.’’. 


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1 SEC. 3012. INTERAGENCY WORKING GROUP ON HEALTH 

2 CARE QUALITY. 

3 (a) IN GENERAL.—The President shall convene a 

4 working group to be known as the Interagency Working 

5 Group on Health Care Quality (referred to in this section 

6 as the ‘‘Working Group’’). 

7 (b) GOALS.—The goals of the Working Group shall 

8 be to achieve the following: 

9 (1) Collaboration, cooperation, and consultation 

10 between Federal departments and agencies with re11 spect to developing and disseminating strategies, 

12 goals, models, and timetables that are consistent 

13 with the national priorities identified under section 

14 399HH(a)(2) of the Public Health Service Act (as 

15 added by section 3011). 

16 (2) Avoidance of inefficient duplication of qual17 ity improvement efforts and resources, where prac18 ticable, and a streamlined process for quality report19 ing and compliance requirements. 

20 (3) Assess alignment of quality efforts in the 

21 public sector with private sector initiatives. 

22 (c) COMPOSITION.— 

23 (1) IN GENERAL.—The Working Group shall be 

24 composed of senior level representatives of— 

25 (A) the Department of Health and Human 

26 Services; 


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1 (B) the Centers for Medicare & Medicaid 

2 Services; 

3 (C) the National Institutes of Health; 

4 (D) the Centers for Disease Control and 

5 Prevention; 

6 (E) the Food and Drug Administration; 

7 (F) the Health Resources and Services Ad8 ministration; 

9 (G) the Agency for Healthcare Research 

10 and Quality; 

11 (H) the Office of the National Coordinator 

12 for Health Information Technology; 

13 (I) the Substance Abuse and Mental 

14 Health Services Administration; 

15 (J) the Administration for Children and 

16 Families; 

17 (K) the Department of Commerce; 

18 (L) the Office of Management and Budget; 

19 (M) the United States Coast Guard; 

20 (N) the Federal Bureau of Prisons; 

21 (O) the National Highway Traffic Safety 

22 Administration; 

23 (P) the Federal Trade Commission; 

24 (Q) the Social Security Administration; 

25 (R) the Department of Labor; 


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1 (S) the United States Office of Personnel 

2 Management; 

3 (T) the Department of Defense; 

4 (U) the Department of Education; 

5 (V) the Department of Veterans Affairs; 

6 (W) the Veterans Health Administration; 

7 and 

8 (X) any other Federal agencies and de9 partments with activities relating to improving 

10 health care quality and safety, as determined by 

11 the President. 

12 (2) CHAIR AND VICE-CHAIR.— 

13 (A) CHAIR.—The Working Group shall be 

14 chaired by the Secretary of Health and Human 

15 Services. 

16 (B) VICE CHAIR.—Members of the Work17 ing Group, other than the Secretary of Health 

18 and Human Services, shall serve as Vice Chair 

19 of the Group on a rotating basis, as determined 

20 by the Group. 

21 (d) REPORT TO CONGRESS.—Not later than Decem22 ber 31, 2010, and annually thereafter, the Working Group 

23 shall submit to the relevant Committees of Congress, and 

24 make public on an Internet website, a report describing 


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1 the progress and recommendations of the Working Group 

2 in meeting the goals described in subsection (b). 

3 SEC. 3013. QUALITY MEASURE DEVELOPMENT. 

4 (a) PUBLIC HEALTH SERVICE ACT.—Title IX of the 

5 Public Health Service Act (42 U.S.C. 299 et seq.) is 

6 amended— 

7 (1) by redesignating part D as part E; 

8 (2) by redesignating sections 931 through 938 

9 as sections 941 through 948, respectively; 

10 (3) in section 948(1), as so redesignated, by 

11 striking ‘‘931’’ and inserting ‘‘941’’; and 

12 (4) by inserting after section 926 the following: 

13 ‘‘PART D—HEALTH CARE QUALITY 

14 IMPROVEMENT 

15 ‘‘Subpart I—Quality Measure Development 

16 ‘‘SEC. 931. QUALITY MEASURE DEVELOPMENT. 

17 ‘‘(a) QUALITY MEASURE.—In this subpart, the term 

18 ‘quality measure’ means a standard for measuring the per19 formance and improvement of population health or of 

20 health plans, providers of services, and other clinicians in 

21 the delivery of health care services. 

22 ‘‘(b) IDENTIFICATION OF QUALITY MEASURES.— 

23 ‘‘(1) IDENTIFICATION.—The Secretary, in con24 sultation with the Director of the Agency for 

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1 trator of the Centers for Medicare & Medicaid Serv2 ices, shall identify, not less often than triennially, 

3 gaps where no quality measures exist and existing 

4 quality measures that need improvement, updating, 

5 or expansion, consistent with the national strategy 

6 under section 399HH, to the extent available, for 

7 use in Federal health programs. In identifying such 

8 gaps and existing quality measures that need im9 provement, the Secretary shall take into consider10 ation— 

11 ‘‘(A) the gaps identified by the entity with 

12 a contract under section 1890(a) of the Social 

13 Security Act and other stakeholders; 

14 ‘‘(B) quality measures identified by the pe15 diatric quality measures program under section 

16 1139A of the Social Security Act; and 

17 ‘‘(C) quality measures identified through 

18 the Medicaid Quality Measurement Program 

19 under section 1139B of the Social Security Act. 

20 ‘‘(2) PUBLICATION.—The Secretary shall make 

21 available to the public on an Internet website a re22 port on any gaps identified under paragraph (1) and 

23 the process used to make such identification. 

24 ‘‘(c) GRANTS OR CONTRACTS FOR QUALITY MEAS25 URE DEVELOPMENT.— 


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1 ‘‘(1) IN GENERAL.—The Secretary shall award 

2 grants, contracts, or intergovernmental agreements 

3 to eligible entities for purposes of developing, im4 proving, updating, or expanding quality measures 

5 identified under subsection (b). 

6 ‘‘(2) PRIORITIZATION IN THE DEVELOPMENT

7 OF QUALITY MEASURES.—In awarding grants, con8 tracts, or agreements under this subsection, the Sec9 retary shall give priority to the development of qual10 ity measures that allow the assessment of— 

11 ‘‘(A) health outcomes and functional status 

12 of patients; 

13 ‘‘(B) the management and coordination of 

14 health care across episodes of care and care 

15 transitions for patients across the continuum of 

16 providers, health care settings, and health 

17 plans; 

18 ‘‘(C) the experience, quality, and use of in19 formation provided to and used by patients, 

20 caregivers, and authorized representatives to in21 form decisionmaking about treatment options, 

22 including the use of shared decisionmaking 

23 tools and preference sensitive care (as defined 

24 in section 936); 


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1 ‘‘(D) the meaningful use of health informa2 tion technology; 

3 ‘‘(E) the safety, effectiveness, patient4 centeredness, appropriateness, and timeliness of 

5 care; 

6 ‘‘(F) the efficiency of care; 

7 ‘‘(G) the equity of health services and 

8 health disparities across health disparity popu9 lations (as defined in section 485E) and geo10 graphic areas; 

11 ‘‘(H) patient experience and satisfaction; 

12 ‘‘(I) the use of innovative strategies and 

13 methodologies identified under section 933; and 

14 ‘‘(J) other areas determined appropriate by 

15 the Secretary. 

16 ‘‘(3) ELIGIBLE ENTITIES.—To be eligible for a 

17 grant or contract under this subsection, an entity 

18 shall— 

19 ‘‘(A) have demonstrated expertise and ca20 pacity in the development and evaluation of 

21 quality measures; 

22 ‘‘(B) have adopted procedures to include in 

23 the quality measure development process— 


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1 ‘‘(i) the views of those providers or 

2 payers whose performance will be assessed 

3 by the measure; and 

4 ‘‘(ii) the views of other parties who 

5 also will use the quality measures (such as 

6 patients, consumers, and health care pur7 chasers); 

8 ‘‘(C) collaborate with the entity with a con9 tract under section 1890(a) of the Social Secu10 rity Act and other stakeholders, as practicable, 

11 and the Secretary so that quality measures de12 veloped by the eligible entity will meet the re13 quirements to be considered for endorsement by 

14 the entity with a contract under such section 

15 1890(a); 

16 ‘‘(D) have transparent policies regarding 

17 governance and conflicts of interest; and 

18 ‘‘(E) submit an application to the Sec19 retary at such time and in such manner, as the 

20 Secretary may require. 

21 ‘‘(4) USE OF FUNDS.—An entity that receives 

22 a grant, contract, or agreement under this sub23 section shall use such award to develop quality 

24 measures that meet the following requirements: 


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1 ‘‘(A) Such measures support measures re2 quired to be reported under the Social Security 

3 Act, where applicable, and in support of gaps 

4 and existing quality measures that need im5 provement, as described in subsection (b)(1)(A). 

6 ‘‘(B) Such measures support measures de7 veloped under section 1139A of the Social Secu8 rity Act and the Medicaid Quality Measurement 

9 Program under section 1139B of such Act, 

10 where applicable. 

11 ‘‘(C) To the extent practicable, data on 

12 such quality measures is able to be collected 

13 using health information technologies. 

14 ‘‘(D) Each quality measure is free of 

15 charge to users of such measure. 

16 ‘‘(E) Each quality measure is publicly 

17 available on an Internet website. 

18 ‘‘(d) OTHER ACTIVITIES BY THE SECRETARY.—The 

19 Secretary may use amounts available under this section 

20 to update and test, where applicable, quality measures en21 dorsed by the entity with a contract under section 1890(a) 

22 of the Social Security Act or adopted by the Secretary. 

23 ‘‘(e) COORDINATION OF GRANTS.—The Secretary 

24 shall ensure that grants or contracts awarded under this 

25 section are coordinated with grants and contracts awarded 


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1 under sections 1139A(5) and 1139B(4)(A) of the Social 

2 Security Act.’’. 

3 (b) SOCIAL SECURITY ACT.—Section 1890A of the 

4 Social Security Act, as added by section 3014(b), is 

5 amended by adding at the end the following new sub6 section: 

7 ‘‘(e) DEVELOPMENT OF QUALITY MEASURES.—The 

8 Administrator of the Center for Medicare & Medicaid 

9 Services shall through contracts develop quality measures 

10 (as determined appropriate by the Administrator) for use 

11 under this Act. In developing such measures, the Adminis12 trator shall consult with the Director of the Agency for 

13 Healthcare Research and Quality.’’. 

14 (c) FUNDING.—There are authorized to be appro15 priated to the Secretary of Health and Human Services 

16 to carry out this section, $75,000,000 for each of fiscal 

17 years 2010 through 2014. Of the amounts appropriated 

18 under the preceding sentence in a fiscal year, not less than 

19 50 percent of such amounts shall be used pursuant to sub20 section (e) of section 1890A of the Social Security Act, 

21 as added by subsection (b), with respect to programs 

22 under such Act. Amounts appropriated under this sub23 section for a fiscal year shall remain available until ex24 pended. 


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1 SEC. 3014. QUALITY MEASUREMENT. 

2 (a) NEW DUTIES FOR CONSENSUS-BASED ENTITY.— 

3 (1) MULTI-STAKEHOLDER GROUP INPUT.—Sec4 tion 1890(b) of the Social Security Act (42 U.S.C. 

5 1395aaa(b)), as amended by section 3003, is amend6 ed by adding at the end the following new para7 graphs: 

8 ‘‘(7) CONVENING MULTI-STAKEHOLDER

9 GROUPS.— 

10 ‘‘(A) IN GENERAL.—The entity shall con11 vene multi-stakeholder groups to provide input 

12 on— 

13 ‘‘(i) the selection of quality measures 

14 described in subparagraph (B), from 

15 among— 

16 ‘‘(I) such measures that have 

17 been endorsed by the entity; and 

18 ‘‘(II) such measures that have 

19 not been considered for endorsement 

20 by such entity but are used or pro21 posed to be used by the Secretary for 

22 the collection or reporting of quality 

23 measures; and 

24 ‘‘(ii) national priorities (as identified 

25 under section 399HH of the Public Health 

26 Service Act) for improvement in population 


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1 health and in the delivery of health care 

2 services for consideration under the na3 tional strategy established under section 

4 399HH of the Public Health Service Act. 

5 ‘‘(B) QUALITY MEASURES.— 

6 ‘‘(i) IN GENERAL.—Subject to clause 

7 (ii), the quality measures described in this 

8 subparagraph are quality measures— 

9 ‘‘(I) for use pursuant to sections 

10 1814(i)(5)(D), 1833(i)(7), 

11 1833(t)(17), 1848(k)(2)(C), 

12 1866(k)(3), 1881(h)(2)(A)(iii), 

13 1886(b)(3)(B)(viii), 1886(j)(7)(D), 

14 1886(m)(5)(D), 1886(o)(2), and 

15 1895(b)(3)(B)(v); 

16 ‘‘(II) for use in reporting per17 formance information to the public; 

18 and 

19 ‘‘(III) for use in health care pro20 grams other than for use under this 

21 Act. 

22 ‘‘(ii) EXCLUSION.—Data sets (such as 

23 the outcome and assessment information 

24 set for home health services and the min25 imum data set for skilled nursing facility 


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1 services) that are used for purposes of 

2 classification systems used in establishing 

3 payment rates under this title shall not be 

4 quality measures described in this subpara5 graph. 

6 ‘‘(C) REQUIREMENT FOR TRANSPARENCY

7 IN PROCESS.— 

8 ‘‘(i) IN GENERAL.—In convening 

9 multi-stakeholder groups under subpara10 graph (A) with respect to the selection of 

11 quality measures, the entity shall provide 

12 for an open and transparent process for 

13 the activities conducted pursuant to such 

14 convening. 

15 ‘‘(ii) SELECTION OF ORGANIZATIONS

16 PARTICIPATING IN MULTI-STAKEHOLDER

17 GROUPS.—The process described in clause 

18 (i) shall ensure that the selection of rep19 resentatives comprising such groups pro20 vides for public nominations for, and the 

21 opportunity for public comment on, such 

22 selection. 

23 ‘‘(D) MULTI-STAKEHOLDER GROUP DE24 FINED.—In this paragraph, the term ‘multi25 stakeholder group’ means, with respect to a 


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1 quality measure, a voluntary collaborative of or2 ganizations representing a broad group of 

3 stakeholders interested in or affected by the use 

4 of such quality measure. 

5 ‘‘(8) TRANSMISSION OF MULTI-STAKEHOLDER

6 INPUT.—Not later than February 1 of each year 

7 (beginning with 2012), the entity shall transmit to 

8 the Secretary the input of multi-stakeholder groups 

9 provided under paragraph (7).’’. 

10 (2) ANNUAL REPORT.—Section 1890(b)(5)(A) 

11 of the Social Security Act (42 U.S.C. 

12 1395aaa(b)(5)(A)) is amended— 

13 (A) in clause (ii), by striking ‘‘and’’ at the 

14 end; 

15 (B) in clause (iii), by striking the period at 

16 the end and inserting a semicolon; and 

17 (C) by adding at the end the following new 

18 clauses: 

19 ‘‘(iv) gaps in endorsed quality meas20 ures, which shall include measures that are 

21 within priority areas identified by the Sec22 retary under the national strategy estab23 lished under section 399HH of the Public 

24 Health Service Act, and where quality 


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1 measures are unavailable or inadequate to 

2 identify or address such gaps; 

3 ‘‘(v) areas in which evidence is insuffi4 cient to support endorsement of quality 

5 measures in priority areas identified by the 

6 Secretary under the national strategy es7 tablished under section 399HH of the 

8 Public Health Service Act and where tar9 geted research may address such gaps; and 

10 ‘‘(vi) the matters described in clauses 

11 (i) and (ii) of paragraph (7)(A).’’. 

12 (b) MULTI-STAKEHOLDER GROUP INPUT INTO SE13 LECTION OF QUALITY MEASURES.—Title XVIII of the So14 cial Security Act (42 U.S.C. 1395 et seq.) is amended by 

15 inserting after section 1890 the following: 

16 ‘‘QUALITY MEASUREMENT

17 ‘‘SEC. 1890A. (a) MULTI-STAKEHOLDER GROUP

18 INPUT INTO SELECTION OF QUALITY MEASURES.—The 

19 Secretary shall establish a pre-rulemaking process under 

20 which the following steps occur with respect to the selec21 tion of quality measures described in section 

22 1890(b)(7)(B): 

23 ‘‘(1) INPUT.—Pursuant to section 1890(b)(7), 

24 the entity with a contract under section 1890 shall 

25 convene multi-stakeholder groups to provide input to 


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1 the Secretary on the selection of quality measures 

2 described in subparagraph (B) of such paragraph. 

3 ‘‘(2) PUBLIC AVAILABILITY OF MEASURES CON4 SIDERED FOR SELECTION.—Not later than Decem5 ber 1 of each year (beginning with 2011), the Sec6 retary shall make available to the public a list of 

7 quality measures described in section 1890(b)(7)(B) 

8 that the Secretary is considering under this title. 

9 ‘‘(3) TRANSMISSION OF MULTI-STAKEHOLDER

10 INPUT.—Pursuant to section 1890(b)(8), not later 

11 than February 1 of each year (beginning with 

12 2012), the entity shall transmit to the Secretary the 

13 input of multi-stakeholder groups described in para14 graph (1). 

15 ‘‘(4) CONSIDERATION OF MULTI-STAKEHOLDER

16 INPUT.—The Secretary shall take into consideration 

17 the input from multi-stakeholder groups described in 

18 paragraph (1) in selecting quality measures de19 scribed in section 1890(b)(7)(B) that have been en20 dorsed by the entity with a contract under section 

21 1890 and measures that have not been endorsed by 

22 such entity. 

23 ‘‘(5) RATIONALE FOR USE OF QUALITY MEAS24 URES.—The Secretary shall publish in the Federal 

25 Register the rationale for the use of any quality 


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1 measure described in section 1890(b)(7)(B) that has 

2 not been endorsed by the entity with a contract 

3 under section 1890. 

4 ‘‘(6) ASSESSMENT OF IMPACT.—Not later than 

5 March 1, 2012, and at least once every three years 

6 thereafter, the Secretary shall— 

7 ‘‘(A) conduct an assessment of the quality 

8 impact of the use of endorsed measures de9 scribed in section 1890(b)(7)(B); and 

10 ‘‘(B) make such assessment available to 

11 the public. 

12 ‘‘(b) PROCESS FOR DISSEMINATION OF MEASURES

13 USED BY THE SECRETARY.— 

14 ‘‘(1) IN GENERAL.—The Secretary shall estab15 lish a process for disseminating quality measures 

16 used by the Secretary. Such process shall include the 

17 following: 

18 ‘‘(A) The incorporation of such measures, 

19 where applicable, in workforce programs, train20 ing curricula, and any other means of dissemi21 nation determined appropriate by the Secretary. 

22 ‘‘(B) The dissemination of such quality 

23 measures through the national strategy devel24 oped under section 399HH of the Public Health 

25 Service Act. 


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1 ‘‘(2) EXISTING METHODS.—To the extent prac2 ticable, the Secretary shall utilize and expand exist3 ing dissemination methods in disseminating quality 

4 measures under the process established under para5 graph (1). 

6 ‘‘(c) REVIEW OF QUALITY MEASURES USED BY THE

7 SECRETARY.— 

8 ‘‘(1) IN GENERAL.—The Secretary shall— 

9 ‘‘(A) periodically (but in no case less often 

10 than once every 3 years) review quality meas11 ures described in section 1890(b)(7)(B); and 

12 ‘‘(B) with respect to each such measure, 

13 determine whether to— 

14 ‘‘(i) maintain the use of such meas15 ure; or 

16 ‘‘(ii) phase out such measure. 

17 ‘‘(2) CONSIDERATIONS.—In conducting the re18 view under paragraph (1), the Secretary shall take 

19 steps to— 

20 ‘‘(A) seek to avoid duplication of measures 

21 used; and 

22 ‘‘(B) take into consideration current inno23 vative methodologies and strategies for quality 

24 improvement practices in the delivery of health 

25 care services that represent best practices for 


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1 such quality improvement and measures en2 dorsed by the entity with a contract under sec3 tion 1890 since the previous review by the Sec4 retary. 

5 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec6 tion shall preclude a State from using the quality meas7 ures identified under sections 1139A and 1139B.’’. 

8 (c) FUNDING.—For purposes of carrying out the 

9 amendments made by this section, the Secretary shall pro10 vide for the transfer, from the Federal Hospital Insurance 

11 Trust Fund under section 1817 of the Social Security Act 

12 (42 U.S.C. 1395i) and the Federal Supplementary Med13 ical Insurance Trust Fund under section 1841 of such Act 

14 (42 U.S.C. 1395t), in such proportion as the Secretary 

15 determines appropriate, of $20,000,000, to the Centers for 

16 Medicare & Medicaid Services Program Management Ac17 count for each of fiscal years 2010 through 2014. 

18 Amounts transferred under the preceding sentence shall 

19 remain available until expended. 

20 SEC. 3015. DATA COLLECTION; PUBLIC REPORTING. 

21 Title III of the Public Health Service Act (42 U.S.C. 

22 241 et seq.), as amended by section 3011, is further 

23 amended by adding at the end the following: 


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1 ‘‘SEC. 399II. COLLECTION AND ANALYSIS OF DATA FOR 

2 QUALITY AND RESOURCE USE MEASURES. 

3 ‘‘(a) IN GENERAL.—The Secretary shall collect and 

4 aggregate consistent data on quality and resource use 

5 measures from information systems used to support health 

6 care delivery to implement the public reporting of perform7 ance information, as described in section 399JJ, and may 

8 award grants or contracts for this purpose. The Secretary 

9 shall ensure that such collection, aggregation, and analysis 

10 systems span an increasingly broad range of patient popu11 lations, providers, and geographic areas over time. 

12 ‘‘(b) GRANTS OR CONTRACTS FOR DATA COLLEC13 TION.— 

14 ‘‘(1) IN GENERAL.—The Secretary may award 

15 grants or contracts to eligible entities to support 

16 new, or improve existing, efforts to collect and ag17 gregate quality and resource use measures described 

18 under subsection (c). 

19 ‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a 

20 grant or contract under this subsection, an entity 

21 shall— 

22 ‘‘(A) be— 

23 ‘‘(i) a multi-stakeholder entity that co24 ordinates the development of methods and 

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1 porting of summary quality and cost infor2 mation; 

3 ‘‘(ii) an entity capable of submitting 

4 such summary data for a particular popu5 lation and providers, such as a disease reg6 istry, regional collaboration, health plan 

7 collaboration, or other population-wide 

8 source; or 

9 ‘‘(iii) a Federal Indian Health Service 

10 program or a health program operated by 

11 an Indian tribe (as defined in section 4 of 

12 the Indian Health Care Improvement Act); 

13 ‘‘(B) promote the use of the systems that 

14 provide data to improve and coordinate patient 

15 care; 

16 ‘‘(C) support the provision of timely, con17 sistent quality and resource use information to 

18 health care providers, and other groups and or19 ganizations as appropriate, with an opportunity 

20 for providers to correct inaccurate measures; 

21 and 

22 ‘‘(D) agree to report, as determined by the 

23 Secretary, measures on quality and resource use 

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1 porting process established under section 

2 399JJ. 

3 ‘‘(c) CONSISTENT DATA AGGREGATION.—The Sec4 retary may award grants or contracts under this section 

5 only to entities that enable summary data that can be inte6 grated and compared across multiple sources. The Sec7 retary shall provide standards for the protection of the se8 curity and privacy of patient data. 

9 ‘‘(d) MATCHING FUNDS.—The Secretary may not 

10 award a grant or contract under this section to an entity 

11 unless the entity agrees that it will make available (di12 rectly or through contributions from other public or pri13 vate entities) non-Federal contributions toward the activi14 ties to be carried out under the grant or contract in an 

15 amount equal to $1 for each $5 of Federal funds provided 

16 under the grant or contract. Such non-Federal matching 

17 funds may be provided directly or through donations from 

18 public or private entities and may be in cash or in-kind, 

19 fairly evaluated, including plant, equipment, or services. 

20 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—To 

21 carry out this section, there are authorized to be appro22 priated such sums as may be necessary for fiscal years 

23 2010 through 2014. 


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1 ‘‘SEC. 399JJ. PUBLIC REPORTING OF PERFORMANCE IN2 FORMATION. 

3 ‘‘(a) DEVELOPMENT OF PERFORMANCE

4 WEBSITES.—The Secretary shall make available to the 

5 public, through standardized Internet websites, perform6 ance information summarizing data on quality measures. 

7 Such information shall be tailored to respond to the dif8 fering needs of hospitals and other institutional health 

9 care providers, physicians and other clinicians, patients, 

10 consumers, researchers, policymakers, States, and other 

11 stakeholders, as the Secretary may specify. 

12 ‘‘(b) INFORMATION ON CONDITIONS.—The perform13 ance information made publicly available on an Internet 

14 website, as described in subsection (a), shall include infor15 mation regarding clinical conditions to the extent such in16 formation is available, and the information shall, where 

17 appropriate, be provider-specific and sufficiently 

18 disaggregated and specific to meet the needs of patients 

19 with different clinical conditions. 

20 ‘‘(c) CONSULTATION.— 

21 ‘‘(1) IN GENERAL.—In carrying out this sec22 tion, the Secretary shall consult with the entity with 

23 a contract under section 1890(a) of the Social Secu24 rity Act, and other entities, as appropriate, to deter25 mine the type of information that is useful to stake26 holders and the format that best facilitates use of 


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1 the reports and of performance reporting Internet 

2 websites. 

3 ‘‘(2) CONSULTATION WITH STAKEHOLDERS.— 

4 The entity with a contract under section 1890(a) of 

5 the Social Security Act shall convene multi-stake6 holder groups, as described in such section, to review 

7 the design and format of each Internet website made 

8 available under subsection (a) and shall transmit to 

9 the Secretary the views of such multi-stakeholder 

10 groups with respect to each such design and format. 

11 ‘‘(d) COORDINATION.—Where appropriate, the Sec12 retary shall coordinate the manner in which data are pre13 sented through Internet websites described in subsection 

14 (a) and for public reporting of other quality measures by 

15 the Secretary, including such quality measures under title 

16 XVIII of the Social Security Act. 

17 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—To 

18 carry out this section, there are authorized to be appro19 priated such sums as may be necessary for fiscal years 

20 2010 through 2014.’’. 


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1 PART III—ENCOURAGING DEVELOPMENT OF 

2 NEW PATIENT CARE MODELS 

3 SEC. 3021. ESTABLISHMENT OF CENTER FOR MEDICARE 

4 AND MEDICAID INNOVATION WITHIN CMS. 

5 (a) IN GENERAL.—Title XI of the Social Security Act 

6 is amended by inserting after section 1115 the following 

7 new section: 

8 ‘‘CENTER FOR MEDICARE AND MEDICAID INNOVATION

9 ‘‘SEC. 1115A. (a) CENTER FOR MEDICARE AND

10 MEDICAID INNOVATION ESTABLISHED.— 

11 ‘‘(1) IN GENERAL.—There is created within the 

12 Centers for Medicare & Medicaid Services a Center 

13 for Medicare and Medicaid Innovation (in this sec14 tion referred to as the ‘CMI’) to carry out the duties 

15 described in this section. The purpose of the CMI is 

16 to test innovative payment and service delivery mod17 els to reduce program expenditures under the appli18 cable titles while preserving or enhancing the quality 

19 of care furnished to individuals under such titles. In 

20 selecting such models, the Secretary shall give pref21 erence to models that also improve the coordination, 

22 quality, and efficiency of health care services fur23 nished to applicable individuals defined in paragraph 

24 (4)(A). 


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1 ‘‘(2) DEADLINE.—The Secretary shall ensure 

2 that the CMI is carrying out the duties described in 

3 this section by not later than January 1, 2011. 

4 ‘‘(3) CONSULTATION.—In carrying out the du5 ties under this section, the CMI shall consult rep6 resentatives of relevant Federal agencies, and clin7 ical and analytical experts with expertise in medicine 

8 and health care management. The CMI shall use 

9 open door forums or other mechanisms to seek input 

10 from interested parties. 

11 ‘‘(4) DEFINITIONS.—In this section: 

12 ‘‘(A) APPLICABLE INDIVIDUAL.—The term 

13 ‘applicable individual’ means— 

14 ‘‘(i) an individual who is entitled to, 

15 or enrolled for, benefits under part A of 

16 title XVIII or enrolled for benefits under 

17 part B of such title; 

18 ‘‘(ii) an individual who is eligible for 

19 medical assistance under title XIX, under 

20 a State plan or waiver; or 

21 ‘‘(iii) an individual who meets the cri22 teria of both clauses (i) and (ii). 

23 ‘‘(B) APPLICABLE TITLE.—The term ‘ap24 plicable title’ means title XVIII, title XIX, or 

25 both. 


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1 ‘‘(b) TESTING OF MODELS (PHASE I).— 

2 ‘‘(1) IN GENERAL.—The CMI shall test pay3 ment and service delivery models in accordance with 

4 selection criteria under paragraph (2) to determine 

5 the effect of applying such models under the applica6 ble title (as defined in subsection (a)(4)(B)) on pro7 gram expenditures under such titles and the quality 

8 of care received by individuals receiving benefits 

9 under such title. 

10 ‘‘(2) SELECTION OF MODELS TO BE TESTED.— 

11 ‘‘(A) IN GENERAL.—The Secretary shall 

12 select models to be tested from models where 

13 the Secretary determines that there is evidence 

14 that the model addresses a defined population 

15 for which there are deficits in care leading to 

16 poor clinical outcomes or potentially avoidable 

17 expenditures. The models selected under the 

18 preceding sentence may include the models de19 scribed in subparagraph (B). 

20 ‘‘(B) OPPORTUNITIES.—The models de21 scribed in this subparagraph are the following 

22 models: 

23 ‘‘(i) Promoting broad payment and 

24 practice reform in primary care, including 

25 patient-centered medical home models for 


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1 high-need applicable individuals, medical 

2 homes that address women’s unique health 

3 care needs, and models that transition pri4 mary care practices away from fee-for-serv5 ice based reimbursement and toward com6 prehensive payment or salary-based pay7 ment. 

8 ‘‘(ii) Contracting directly with groups 

9 of providers of services and suppliers to 

10 promote innovative care delivery models, 

11 such as through risk-based comprehensive 

12 payment or salary-based payment. 

13 ‘‘(iii) Utilizing geriatric assessments 

14 and comprehensive care plans to coordinate 

15 the care (including through interdiscipli16 nary teams) of applicable individuals with 

17 multiple chronic conditions and at least 

18 one of the following: 

19 ‘‘(I) An inability to perform 2 or 

20 more activities of daily living. 

21 ‘‘(II) Cognitive impairment, in22 cluding dementia. 

23 ‘‘(iv) Promote care coordination be24 tween providers of services and suppliers 

25 that transition health care providers away 


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1 from fee-for-service based reimbursement 

2 and toward salary-based payment. 

3 ‘‘(v) Supporting care coordination for 

4 chronically-ill applicable individuals at high 

5 risk of hospitalization through a health in6 formation technology-enabled provider net7 work that includes care coordinators, a 

8 chronic disease registry, and home tele9 health technology. 

10 ‘‘(vi) Varying payment to physicians 

11 who order advanced diagnostic imaging 

12 services (as defined in section 

13 1834(e)(1)(B)) according to the physi14 cian’s adherence to appropriateness criteria 

15 for the ordering of such services, as deter16 mined in consultation with physician spe17 cialty groups and other relevant stake18 holders. 

19 ‘‘(vii) Utilizing medication therapy 

20 management services, such as those de21 scribed in section 935 of the Public Health 

22 Service Act. 

23 ‘‘(viii) Establishing community-based 

24 health teams to support small-practice 

25 medical homes by assisting the primary 


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1 care practitioner in chronic care manage2 ment, including patient self-management, 

3 activities. 

4 ‘‘(ix) Assisting applicable individuals 

5 in making informed health care choices by 

6 paying providers of services and suppliers 

7 for using patient decision-support tools, in8 cluding tools that meet the standards de9 veloped and identified under section 

10 936(c)(2)(A) of the Public Health Service 

11 Act, that improve applicable individual and 

12 caregiver understanding of medical treat13 ment options. 

14 ‘‘(x) Allowing States to test and 

15 evaluate fully integrating care for dual eli16 gible individuals in the State, including the 

17 management and oversight of all funds 

18 under the applicable titles with respect to 

19 such individuals. 

20 ‘‘(xi) Allowing States to test and 

21 evaluate systems of all-payer payment re22 form for the medical care of residents of 

23 the State, including dual eligible individ24 uals. 


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1 ‘‘(xii) Aligning nationally recognized, 

2 evidence-based guidelines of cancer care 

3 with payment incentives under title XVIII 

4 in the areas of treatment planning and fol5 low-up care planning for applicable individ6 uals described in clause (i) or (iii) of sub7 section (a)(4)(A) with cancer, including the 

8 identification of gaps in applicable quality 

9 measures. 

10 ‘‘(xiii) Improving post-acute care 

11 through continuing care hospitals that 

12 offer inpatient rehabilitation, long-term 

13 care hospitals, and home health or skilled 

14 nursing care during an inpatient stay and 

15 the 30 days immediately following dis16 charge. 

17 ‘‘(xiv) Funding home health providers 

18 who offer chronic care management serv19 ices to applicable individuals in cooperation 

20 with interdisciplinary teams. 

21 ‘‘(xv) Promoting improved quality and 

22 reduced cost by developing a collaborative 

23 of high-quality, low-cost health care insti24 tutions that is responsible for— 


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1 ‘‘(I) developing, documenting, 

2 and disseminating best practices and 

3 proven care methods; 

4 ‘‘(II) implementing such best 

5 practices and proven care methods 

6 within such institutions to dem7 onstrate further improvements in 

8 quality and efficiency; and 

9 ‘‘(III) providing assistance to 

10 other health care institutions on how 

11 best to employ such best practices and 

12 proven care methods to improve 

13 health care quality and lower costs. 

14 ‘‘(xvi) Facilitate inpatient care, in15 cluding intensive care, of hospitalized ap16 plicable individuals at their local hospital 

17 through the use of electronic monitoring by 

18 specialists, including intensivists and crit19 ical care specialists, based at integrated 

20 health systems. 

21 ‘‘(xvii) Promoting greater efficiencies 

22 and timely access to outpatient services 

23 (such as outpatient physical therapy serv24 ices) through models that do not require a 

25 physician or other health professional to 


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1 refer the service or be involved in estab2 lishing the plan of care for the service, 

3 when such service is furnished by a health 

4 professional who has the authority to fur5 nish the service under existing State law. 

6 ‘‘(xviii) Establishing comprehensive 

7 payments to Healthcare Innovation Zones, 

8 consisting of groups of providers that in9 clude a teaching hospital, physicians, and 

10 other clinical entities, that, through their 

11 structure, operations, and joint-activity de12 liver a full spectrum of integrated and 

13 comprehensive health care services to ap14 plicable individuals while also incorporating 

15 innovative methods for the clinical training 

16 of future health care professionals. 

17 ‘‘(C) ADDITIONAL FACTORS FOR CONSID18 ERATION.—In selecting models for testing 

19 under subparagraph (A), the CMI may consider 

20 the following additional factors: 

21 ‘‘(i) Whether the model includes a 

22 regular process for monitoring and updat23 ing patient care plans in a manner that is 

24 consistent with the needs and preferences 

25 of applicable individuals. 


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1 ‘‘(ii) Whether the model places the ap2 plicable individual, including family mem3 bers and other informal caregivers of the 

4 applicable individual, at the center of the 

5 care team of the applicable individual. 

6 ‘‘(iii) Whether the model provides for 

7 in-person contact with applicable individ8 uals. 

9 ‘‘(iv) Whether the model utilizes tech10 nology, such as electronic health records 

11 and patient-based remote monitoring sys12 tems, to coordinate care over time and 

13 across settings. 

14 ‘‘(v) Whether the model provides for 

15 the maintenance of a close relationship be16 tween care coordinators, primary care 

17 practitioners, specialist physicians, commu18 nity-based organizations, and other pro19 viders of services and suppliers. 

20 ‘‘(vi) Whether the model relies on a 

21 team-based approach to interventions, such 

22 as comprehensive care assessments, care 

23 planning, and self-management coaching. 

24 ‘‘(vii) Whether, under the model, pro25 viders of services and suppliers are able to 


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1 share information with patients, caregivers, 

2 and other providers of services and sup3 pliers on a real time basis. 

4 ‘‘(3) BUDGET NEUTRALITY.— 

5 ‘‘(A) INITIAL PERIOD.—The Secretary 

6 shall not require, as a condition for testing a 

7 model under paragraph (1), that the design of 

8 such model ensure that such model is budget 

9 neutral initially with respect to expenditures 

10 under the applicable title. 

11 ‘‘(B) TERMINATION OR MODIFICATION.— 

12 The Secretary shall terminate or modify the de13 sign and implementation of a model unless the 

14 Secretary determines (and the Chief Actuary of 

15 the Centers for Medicare & Medicaid Services, 

16 with respect to program spending under the ap17 plicable title, certifies), after testing has begun, 

18 that the model is expected to— 

19 ‘‘(i) improve the quality of care (as 

20 determined by the Administrator of the 

21 Centers for Medicare & Medicaid Services) 

22 without increasing spending under the ap23 plicable title; 


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1 ‘‘(ii) reduce spending under the appli2 cable title without reducing the quality of 

3 care; or 

4 ‘‘(iii) improve the quality of care and 

5 reduce spending. 

6 Such termination may occur at any time after 

7 such testing has begun and before completion of 

8 the testing. 

9 ‘‘(4) EVALUATION.— 

10 ‘‘(A) IN GENERAL.—The Secretary shall 

11 conduct an evaluation of each model tested 

12 under this subsection. Such evaluation shall in13 clude an analysis of— 

14 ‘‘(i) the quality of care furnished 

15 under the model, including the measure16 ment of patient-level outcomes and patient17 centeredness criteria determined appro18 priate by the Secretary; and 

19 ‘‘(ii) the changes in spending under 

20 the applicable titles by reason of the 

21 model. 

22 ‘‘(B) INFORMATION.—The Secretary shall 

23 make the results of each evaluation under this 

24 paragraph available to the public in a timely 

25 fashion and may establish requirements for 


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1 States and other entities participating in the 

2 testing of models under this section to collect 

3 and report information that the Secretary de4 termines is necessary to monitor and evaluate 

5 such models. 

6 ‘‘(c) EXPANSION OF MODELS (PHASE II).—Taking 

7 into account the evaluation under subsection (b)(4), the 

8 Secretary may, through rulemaking, expand (including im9 plementation on a nationwide basis) the duration and the 

10 scope of a model that is being tested under subsection (b) 

11 or a demonstration project under section 1866C, to the 

12 extent determined appropriate by the Secretary, if— 

13 ‘‘(1) the Secretary determines that such expan14 sion is expected to— 

15 ‘‘(A) reduce spending under applicable title 

16 without reducing the quality of care; or 

17 ‘‘(B) improve the quality of care and re18 duce spending; and 

19 ‘‘(2) the Chief Actuary of the Centers for Medi20 care & Medicaid Services certifies that such expan21 sion would reduce program spending under applica22 ble titles. 

23 ‘‘(d) IMPLEMENTATION.— 

24 ‘‘(1) WAIVER AUTHORITY.—The Secretary may 

25 waive such requirements of titles XI and XVIII and 


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1 of sections 1902(a)(1), 1902(a)(13), and 

2 1903(m)(2)(A)(iii) as may be necessary solely for 

3 purposes of carrying out this section with respect to 

4 testing models described in subsection (b). 

5 ‘‘(2) LIMITATIONS ON REVIEW.—There shall be 

6 no administrative or judicial review under section 

7 1869, section 1878, or otherwise of— 

8 ‘‘(A) the selection of models for testing or 

9 expansion under this section; 

10 ‘‘(B) the selection of organizations, sites, 

11 or participants to test those models selected; 

12 ‘‘(C) the elements, parameters, scope, and 

13 duration of such models for testing or dissemi14 nation; 

15 ‘‘(D) determinations regarding budget neu16 trality under subsection (b)(3); 

17 ‘‘(E) the termination or modification of the 

18 design and implementation of a model under 

19 subsection (b)(3)(B); and 

20 ‘‘(F) determinations about expansion of 

21 the duration and scope of a model under sub22 section (c), including the determination that a 

23 model is not expected to meet criteria described 

24 in paragraph (1) or (2) of such subsection. 


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1 ‘‘(3) ADMINISTRATION.—Chapter 35 of title 44, 

2 United States Code, shall not apply to the testing 

3 and evaluation of models or expansion of such mod4 els under this section. 

5 ‘‘(e) APPLICATION TO CHIP.—The Center may carry 

6 out activities under this section with respect to title XXI 

7 in the same manner as provided under this section with 

8 respect to the program under the applicable titles. 

9 ‘‘(f) FUNDING.— 

10 ‘‘(1) IN GENERAL.—There are appropriated, 

11 from amounts in the Treasury not otherwise appro12 priated— 

13 ‘‘(A) $5,000,000 for the design, implemen14 tation, and evaluation of models under sub15 section (b) for fiscal year 2010; 

16 ‘‘(B) $10,000,000,000 for the activities 

17 initiated under this section for the period of fis18 cal years 2011 through 2019; and 

19 ‘‘(C) the amount described in subpara20 graph (B) for the activities initiated under this 

21 section for each subsequent 10-year fiscal pe22 riod (beginning with the 10-year fiscal period 

23 beginning with fiscal year 2020). 

24 Amounts appropriated under the preceding sentence 

25 shall remain available until expended. 


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1 ‘‘(2) USE OF CERTAIN FUNDS.—Out of 

2 amounts appropriated under subparagraphs (B) and 

3 (C) of paragraph (1), not less than $25,000,000 

4 shall be made available each such fiscal year to de5 sign, implement, and evaluate models under sub6 section (b). 

7 ‘‘(g) REPORT TO CONGRESS.—Beginning in 2012, 

8 and not less than once every other year thereafter, the 

9 Secretary shall submit to Congress a report on activities 

10 under this section. Each such report shall describe the 

11 models tested under subsection (b), including the number 

12 of individuals described in subsection (a)(4)(A)(i) and of 

13 individuals described in subsection (a)(4)(A)(ii) partici14 pating in such models and payments made under applica15 ble titles for services on behalf of such individuals, any 

16 models chosen for expansion under subsection (c), and the 

17 results from evaluations under subsection (b)(4). In addi18 tion, each such report shall provide such recommendations 

19 as the Secretary determines are appropriate for legislative 

20 action to facilitate the development and expansion of suc21 cessful payment models.’’. 

22 (b) MEDICAID CONFORMING AMENDMENT.—Section 

23 1902(a) of the Social Security Act (42 U.S.C. 1396a(a)), 

24 as amended by section 8002(b), is amended— 


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1 (1) in paragraph (81), by striking ‘‘and’’ at the 

2 end; 

3 (2) in paragraph (82), by striking the period at 

4 the end and inserting ‘‘; and’’; and 

5 (3) by inserting after paragraph (82) the fol6 lowing new paragraph: 

7 ‘‘(83) provide for implementation of the pay8 ment models specified by the Secretary under section 

9 1115A(c) for implementation on a nationwide basis 

10 unless the State demonstrates to the satisfaction of 

11 the Secretary that implementation would not be ad12 ministratively feasible or appropriate to the health 

13 care delivery system of the State.’’. 

14 (c) REVISIONS TO HEALTH CARE QUALITY DEM15 ONSTRATION PROGRAM.—Subsections (b) and (f) of sec16 tion 1866C of the Social Security Act (42 U.S.C. 1395cc– 

17 3) are amended by striking ‘‘5-year’’ each place it appears. 

18 SEC. 3022. MEDICARE SHARED SAVINGS PROGRAM. 

19 Title XVIII of the Social Security Act (42 U.S.C. 

20 1395 et seq.) is amended by adding at the end the fol21 lowing new section: 

22 ‘‘SHARED SAVINGS PROGRAM

23 ‘‘SEC. 1899. (a) ESTABLISHMENT.— 

24 ‘‘(1) IN GENERAL.—Not later than January 1, 

25 2012, the Secretary shall establish a shared savings 

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1 gram’) that promotes accountability for a patient 

2 population and coordinates items and services under 

3 parts A and B, and encourages investment in infra4 structure and redesigned care processes for high 

5 quality and efficient service delivery. Under such 

6 program— 

7 ‘‘(A) groups of providers of services and 

8 suppliers meeting criteria specified by the Sec9 retary may work together to manage and co10 ordinate care for Medicare fee-for-service bene11 ficiaries through an accountable care organiza12 tion (referred to in this section as an ‘ACO’); 

13 and 

14 ‘‘(B) ACOs that meet quality performance 

15 standards established by the Secretary are eligi16 ble to receive payments for shared savings 

17 under subsection (d)(2). 

18 ‘‘(b) ELIGIBLE ACOS.— 

19 ‘‘(1) IN GENERAL.—Subject to the succeeding 

20 provisions of this subsection, as determined appro21 priate by the Secretary, the following groups of pro22 viders of services and suppliers which have estab23 lished a mechanism for shared governance are eligi24 ble to participate as ACOs under the program under 

25 this section: 


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1 ‘‘(A) ACO professionals in group practice 

2 arrangements. 

3 ‘‘(B) Networks of individual practices of 

4 ACO professionals. 

5 ‘‘(C) Partnerships or joint venture ar6 rangements between hospitals and ACO profes7 sionals. 

8 ‘‘(D) Hospitals employing ACO profes9 sionals. 

10 ‘‘(E) Such other groups of providers of 

11 services and suppliers as the Secretary deter12 mines appropriate. 

13 ‘‘(2) REQUIREMENTS.—An ACO shall meet the 

14 following requirements: 

15 ‘‘(A) The ACO shall be willing to become 

16 accountable for the quality, cost, and overall 

17 care of the Medicare fee-for-service beneficiaries 

18 assigned to it. 

19 ‘‘(B) The ACO shall enter into an agree20 ment with the Secretary to participate in the 

21 program for not less than a 3-year period (re22 ferred to in this section as the ‘agreement pe23 riod’). 

24 ‘‘(C) The ACO shall have a formal legal 

25 structure that would allow the organization to 


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1 receive and distribute payments for shared sav2 ings under subsection (d)(2) to participating 

3 providers of services and suppliers. 

4 ‘‘(D) The ACO shall include primary care 

5 ACO professionals that are sufficient for the 

6 number of Medicare fee-for-service beneficiaries 

7 assigned to the ACO under subsection (c). At a 

8 minimum, the ACO shall have at least 5,000 

9 such beneficiaries assigned to it under sub10 section (c) in order to be eligible to participate 

11 in the ACO program. 

12 ‘‘(E) The ACO shall provide the Secretary 

13 with such information regarding ACO profes14 sionals participating in the ACO as the Sec15 retary determines necessary to support the as16 signment of Medicare fee-for-service bene17 ficiaries to an ACO, the implementation of 

18 quality and other reporting requirements under 

19 paragraph (3), and the determination of pay20 ments for shared savings under subsection 

21 (d)(2). 

22 ‘‘(F) The ACO shall have in place a leader23 ship and management structure that includes 

24 clinical and administrative systems. 


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1 ‘‘(G) The ACO shall define processes to 

2 promote evidence-based medicine and patient 

3 engagement, report on quality and cost meas4 ures, and coordinate care, such as through the 

5 use of telehealth, remote patient monitoring, 

6 and other such enabling technologies. 

7 ‘‘(H) The ACO shall demonstrate to the 

8 Secretary that it meets patient-centeredness cri9 teria specified by the Secretary, such as the use 

10 of patient and caregiver assessments or the use 

11 of individualized care plans. 

12 ‘‘(3) QUALITY AND OTHER REPORTING RE13 QUIREMENTS.— 

14 ‘‘(A) IN GENERAL.—The Secretary shall 

15 determine appropriate measures to assess the 

16 quality of care furnished by the ACO, such as 

17 measures of— 

18 ‘‘(i) clinical processes and outcomes; 

19 ‘‘(ii) patient and, where practicable, 

20 caregiver experience of care; and 

21 ‘‘(iii) utilization (such as rates of hos22 pital admissions for ambulatory care sen23 sitive conditions). 

24 ‘‘(B) REPORTING REQUIREMENTS.—An 

25 ACO shall submit data in a form and manner 


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1 specified by the Secretary on measures the Sec2 retary determines necessary for the ACO to re3 port in order to evaluate the quality of care fur4 nished by the ACO. Such data may include care 

5 transitions across health care settings, including 

6 hospital discharge planning and post-hospital 

7 discharge follow-up by ACO professionals, as 

8 the Secretary determines appropriate. 

9 ‘‘(C) QUALITY PERFORMANCE STAND10 ARDS.—The Secretary shall establish quality 

11 performance standards to assess the quality of 

12 care furnished by ACOs. The Secretary shall 

13 seek to improve the quality of care furnished by 

14 ACOs over time by specifying higher standards, 

15 new measures, or both for purposes of assessing 

16 such quality of care. 

17 ‘‘(D) OTHER REPORTING REQUIRE18 MENTS.—The Secretary may, as the Secretary 

19 determines appropriate, incorporate reporting 

20 requirements and incentive payments related to 

21 the physician quality reporting initiative 

22 (PQRI) under section 1848, including such re23 quirements and such payments related to elec24 tronic prescribing, electronic health records, 

25 and other similar initiatives under section 1848, 


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1 and may use alternative criteria than would 

2 otherwise apply under such section for deter3 mining whether to make such payments. The 

4 incentive payments described in the preceding 

5 sentence shall not be taken into consideration 

6 when calculating any payments otherwise made 

7 under subsection (d). 

8 ‘‘(4) NO DUPLICATION IN PARTICIPATION IN

9 SHARED SAVINGS PROGRAMS.—A provider of services 

10 or supplier that participates in any of the following 

11 shall not be eligible to participate in an ACO under 

12 this section: 

13 ‘‘(A) A model tested or expanded under 

14 section 1115A that involves shared savings 

15 under this title, or any other program or dem16 onstration project that involves such shared 

17 savings. 

18 ‘‘(B) The independence at home medical 

19 practice pilot program under section 1866E. 

20 ‘‘(c) ASSIGNMENT OF MEDICARE FEE-FOR-SERVICE

21 BENEFICIARIES TO ACOS.—The Secretary shall deter22 mine an appropriate method to assign Medicare fee-for23 service beneficiaries to an ACO based on their utilization 

24 of primary care services provided under this title by an 

25 ACO professional described in subsection (h)(1)(A). 


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1 ‘‘(d) PAYMENTS AND TREATMENT OF SAVINGS.— 

2 ‘‘(1) PAYMENTS.— 

3 ‘‘(A) IN GENERAL.—Under the program, 

4 subject to paragraph (3), payments shall con5 tinue to be made to providers of services and 

6 suppliers participating in an ACO under the 

7 original Medicare fee-for-service program under 

8 parts A and B in the same manner as they 

9 would otherwise be made except that a partici10 pating ACO is eligible to receive payment for 

11 shared savings under paragraph (2) if— 

12 ‘‘(i) the ACO meets quality perform13 ance standards established by the Sec14 retary under subsection (b)(3); and 

15 ‘‘(ii) the ACO meets the requirement 

16 under subparagraph (B)(i). 

17 ‘‘(B) SAVINGS REQUIREMENT AND BENCH18 MARK.— 

19 ‘‘(i) DETERMINING SAVINGS.—In each 

20 year of the agreement period, an ACO 

21 shall be eligible to receive payment for 

22 shared savings under paragraph (2) only if 

23 the estimated average per capita Medicare 

24 expenditures under the ACO for Medicare 

25 fee-for-service beneficiaries for parts A and 


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1 B services, adjusted for beneficiary charac2 teristics, is at least the percent specified by 

3 the Secretary below the applicable bench4 mark under clause (ii). The Secretary shall 

5 determine the appropriate percent de6 scribed in the preceding sentence to ac7 count for normal variation in expenditures 

8 under this title, based upon the number of 

9 Medicare fee-for-service beneficiaries as10 signed to an ACO. 

11 ‘‘(ii) ESTABLISH AND UPDATE

12 BENCHMARK.—The Secretary shall esti13 mate a benchmark for each agreement pe14 riod for each ACO using the most recent 

15 available 3 years of per-beneficiary expend16 itures for parts A and B services for Medi17 care fee-for-service beneficiaries assigned 

18 to the ACO. Such benchmark shall be ad19 justed for beneficiary characteristics and 

20 such other factors as the Secretary deter21 mines appropriate and updated by the pro22 jected absolute amount of growth in na23 tional per capita expenditures for parts A 

24 and B services under the original Medicare 

25 fee-for-service program, as estimated by 


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1 the Secretary. Such benchmark shall be 

2 reset at the start of each agreement pe3 riod. 

4 ‘‘(2) PAYMENTS FOR SHARED SAVINGS.—Sub5 ject to performance with respect to the quality per6 formance standards established by the Secretary 

7 under subsection (b)(3), if an ACO meets the re8 quirements under paragraph (1), a percent (as de9 termined appropriate by the Secretary) of the dif10 ference between such estimated average per capita 

11 Medicare expenditures in a year, adjusted for bene12 ficiary characteristics, under the ACO and such 

13 benchmark for the ACO may be paid to the ACO as 

14 shared savings and the remainder of such difference 

15 shall be retained by the program under this title. 

16 The Secretary shall establish limits on the total 

17 amount of shared savings that may be paid to an 

18 ACO under this paragraph. 

19 ‘‘(3) MONITORING AVOIDANCE OF AT-RISK PA20 TIENTS.—If the Secretary determines that an ACO 

21 has taken steps to avoid patients at risk in order to 

22 reduce the likelihood of increasing costs to the ACO 

23 the Secretary may impose an appropriate sanction 

24 on the ACO, including termination from the pro25 gram. 


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1 ‘‘(4) TERMINATION.—The Secretary may termi2 nate an agreement with an ACO if it does not meet 

3 the quality performance standards established by the 

4 Secretary under subsection (b)(3). 

5 ‘‘(e) ADMINISTRATION.—Chapter 35 of title 44, 

6 United States Code, shall not apply to the program. 

7 ‘‘(f) WAIVER AUTHORITY.—The Secretary may waive 

8 such requirements of sections 1128A and 1128B and title 

9 XVIII of this Act as may be necessary to carry out the 

10 provisions of this section. 

11 ‘‘(g) LIMITATIONS ON REVIEW.—There shall be no 

12 administrative or judicial review under section 1869, sec13 tion 1878, or otherwise of— 

14 ‘‘(1) the specification of criteria under sub15 section (a)(1)(B); 

16 ‘‘(2) the assessment of the quality of care fur17 nished by an ACO and the establishment of perform18 ance standards under subsection (b)(3); 

19 ‘‘(3) the assignment of Medicare fee-for-service 

20 beneficiaries to an ACO under subsection (c); 

21 ‘‘(4) the determination of whether an ACO is 

22 eligible for shared savings under subsection (d)(2) 

23 and the amount of such shared savings, including 

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1 care fee-for-service beneficiaries assigned to the ACO 

2 and the average benchmark for the ACO under sub3 section (d)(1)(B); 

4 ‘‘(5) the percent of shared savings specified by 

5 the Secretary under subsection (d)(2) and any limit 

6 on the total amount of shared savings established by 

7 the Secretary under such subsection; and 

8 ‘‘(6) the termination of an ACO under sub9 section (d)(4). 

10 ‘‘(h) DEFINITIONS.—In this section: 

11 ‘‘(1) ACO PROFESSIONAL.—The term ‘ACO 

12 professional’ means— 

13 ‘‘(A) a physician (as defined in section 

14 1861(r)(1)); and 

15 ‘‘(B) a practitioner described in section 

16 1842(b)(18)(C)(i). 

17 ‘‘(2) HOSPITAL.—The term ‘hospital’ means a 

18 subsection (d) hospital (as defined in section 

19 1886(d)(1)(B)). 

20 ‘‘(3) MEDICARE FEE-FOR-SERVICE BENE21 FICIARY.—The term ‘Medicare fee-for-service bene22 ficiary’ means an individual who is enrolled in the 

23 original Medicare fee-for-service program under 

24 parts A and B and is not enrolled in an MA plan 


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1 under part C, an eligible organization under section 

2 1876, or a PACE program under section 1894.’’. 

3 SEC. 3023. NATIONAL PILOT PROGRAM ON PAYMENT BUN4 DLING. 

5 Title XVIII of the Social Security Act, as amended 

6 by section 3021, is amended by inserting after section 

7 1886C the following new section: 

8 ‘‘NATIONAL PILOT PROGRAM ON PAYMENT BUNDLING

9 ‘‘SEC. 1866D. (a) IMPLEMENTATION.— 

10 ‘‘(1) IN GENERAL.—The Secretary shall estab11 lish a pilot program for integrated care during an 

12 episode of care provided to an applicable beneficiary 

13 around a hospitalization in order to improve the co14 ordination, quality, and efficiency of health care 

15 services under this title. 

16 ‘‘(2) DEFINITIONS.—In this section: 

17 ‘‘(A) APPLICABLE BENEFICIARY.—The 

18 term ‘applicable beneficiary’ means an indi19 vidual who— 

20 ‘‘(i) is entitled to, or enrolled for, ben21 efits under part A and enrolled for benefits 

22 under part B of such title, but not enrolled 

23 under part C or a PACE program under 

24 section 1894; and 

25 ‘‘(ii) is admitted to a hospital for an 

26 applicable condition. 


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1 ‘‘(B) APPLICABLE CONDITION.—The term 

2 ‘applicable condition’ means 1 or more of 8 con3 ditions selected by the Secretary. In selecting 

4 conditions under the preceding sentence, the 

5 Secretary shall take into consideration the fol6 lowing factors: 

7 ‘‘(i) Whether the conditions selected 

8 include a mix of chronic and acute condi9 tions. 

10 ‘‘(ii) Whether the conditions selected 

11 include a mix of surgical and medical con12 ditions. 

13 ‘‘(iii) Whether a condition is one for 

14 which there is evidence of an opportunity 

15 for providers of services and suppliers to 

16 improve the quality of care furnished while 

17 reducing total expenditures under this 

18 title. 

19 ‘‘(iv) Whether a condition has signifi20 cant variation in— 

21 ‘‘(I) the number of readmissions; 

22 and 

23 ‘‘(II) the amount of expenditures 

24 for post-acute care spending under 

25 this title. 


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1 ‘‘(v) Whether a condition is high-vol2 ume and has high post-acute care expendi3 tures under this title. 

4 ‘‘(vi) Which conditions the Secretary 

5 determines are most amenable to bundling 

6 across the spectrum of care given practice 

7 patterns under this title. 

8 ‘‘(C) APPLICABLE SERVICES.—The term 

9 ‘applicable services’ means the following: 

10 ‘‘(i) Acute care inpatient services. 

11 ‘‘(ii) Physicians’ services delivered in 

12 and outside of an acute care hospital set13 ting. 

14 ‘‘(iii) Outpatient hospital services, in15 cluding emergency department services. 

16 ‘‘(iv) Post-acute care services, includ17 ing home health services, skilled nursing 

18 services, inpatient rehabilitation services, 

19 and inpatient hospital services furnished by 

20 a long-term care hospital. 

21 ‘‘(v) Other services the Secretary de22 termines appropriate. 

23 ‘‘(D) EPISODE OF CARE.— 

24 ‘‘(i) IN GENERAL.—Subject to clause 

25 (ii), the term ‘episode of care’ means, with 


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1 respect to an applicable condition and an 

2 applicable beneficiary, the period that in3 cludes— 

4 ‘‘(I) the 3 days prior to the ad5 mission of the applicable beneficiary 

6 to a hospital for the applicable condi7 tion; 

8 ‘‘(II) the length of stay of the ap9 plicable beneficiary in such hospital; 

10 and 

11 ‘‘(III) the 30 days following the 

12 discharge of the applicable beneficiary 

13 from such hospital. 

14 ‘‘(ii) ESTABLISHMENT OF PERIOD BY

15 THE SECRETARY.—The Secretary, as ap16 propriate, may establish a period (other 

17 than the period described in clause (i)) for 

18 an episode of care under the pilot program. 

19 ‘‘(E) PHYSICIANS’ SERVICES.—The term 

20 ‘physicians’ services’ has the meaning given 

21 such term in section 1861(q). 

22 ‘‘(F) PILOT PROGRAM.—The term ‘pilot 

23 program’ means the pilot program under this 

24 section. 


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1 ‘‘(G) PROVIDER OF SERVICES.—The term 

2 ‘provider of services’ has the meaning given 

3 such term in section 1861(u). 

4 ‘‘(H) READMISSION.—The term ‘readmis5 sion’ has the meaning given such term in sec6 tion 1886(q)(5)(E). 

7 ‘‘(I) SUPPLIER.—The term ‘supplier’ has 

8 the meaning given such term in section 

9 1861(d). 

10 ‘‘(3) DEADLINE FOR IMPLEMENTATION.—The 

11 Secretary shall establish the pilot program not later 

12 than January 1, 2013. 

13 ‘‘(b) DEVELOPMENTAL PHASE.— 

14 ‘‘(1) DETERMINATION OF PATIENT ASSESS15 MENT INSTRUMENT.—The Secretary shall determine 

16 which patient assessment instrument (such as the 

17 Continuity Assessment Record and Evaluation 

18 (CARE) tool) shall be used under the pilot program 

19 to evaluate the applicable condition of an applicable 

20 beneficiary for purposes of determining the most 

21 clinically appropriate site for the provision of post22 acute care to the applicable beneficiary. 

23 ‘‘(2) DEVELOPMENT OF QUALITY MEASURES

24 FOR AN EPISODE OF CARE AND FOR POST-ACUTE

25 CARE.— 


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1 ‘‘(A) IN GENERAL.—The Secretary, in con2 sultation with the Agency for Healthcare Re3 search and Quality and the entity with a con4 tract under section 1890(a) of the Social Secu5 rity Act, shall develop quality measures for use 

6 in the pilot program— 

7 ‘‘(i) for episodes of care; and 

8 ‘‘(ii) for post-acute care. 

9 ‘‘(B) SITE-NEUTRAL POST-ACUTE CARE

10 QUALITY MEASURES.—Any quality measures 

11 developed under subparagraph (A)(ii) shall be 

12 site-neutral. 

13 ‘‘(C) COORDINATION WITH QUALITY MEAS14 URE DEVELOPMENT AND ENDORSEMENT PRO15 CEDURES.—The Secretary shall ensure that the 

16 development of quality measures under sub17 paragraph (A) is done in a manner that is con18 sistent with the measures developed and en19 dorsed under section 1890 and 1890A that are 

20 applicable to all post-acute care settings. 

21 ‘‘(c) DETAILS.— 

22 ‘‘(1) DURATION.— 

23 ‘‘(A) IN GENERAL.—Subject to subpara24 graph (B), the pilot program shall be conducted 

25 for a period of 5 years. 


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1 ‘‘(B) EXTENSION.—The Secretary may ex2 tend the duration of the pilot program for pro3 viders of services and suppliers participating in 

4 the pilot program as of the day before the end 

5 of the 5-year period described in subparagraph 

6 (A), for a period determined appropriate by the 

7 Secretary, if the Secretary determines that such 

8 extension will result in improving or not reduc9 ing the quality of patient care and reducing 

10 spending under this title. 

11 ‘‘(2) PARTICIPATING PROVIDERS OF SERVICES

12 AND SUPPLIERS.— 

13 ‘‘(A) IN GENERAL.—An entity comprised 

14 of providers of services and suppliers, including 

15 a hospital, a physician group, a skilled nursing 

16 facility, and a home health agency, who are oth17 erwise participating under this title, may sub18 mit an application to the Secretary to provide 

19 applicable services to applicable individuals 

20 under this section. 

21 ‘‘(B) REQUIREMENTS.—The Secretary 

22 shall develop requirements for entities to par23 ticipate in the pilot program under this section. 

24 Such requirements shall ensure that applicable 

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1 viders of services and suppliers under the pilot 

2 program. 

3 ‘‘(3) PAYMENT METHODOLOGY.— 

4 ‘‘(A) IN GENERAL.— 

5 ‘‘(i) ESTABLISHMENT OF PAYMENT

6 METHODS.—The Secretary shall develop 

7 payment methods for the pilot program for 

8 entities participating in the pilot program. 

9 Such payment methods may include bun10 dled payments and bids from entities for 

11 episodes of care. The Secretary shall make 

12 payments to the entity for services covered 

13 under this section. 

14 ‘‘(ii) NO ADDITIONAL PROGRAM EX15 PENDITURES.—Payments under this sec16 tion for applicable items and services under 

17 this title (including payment for services 

18 described in subparagraph (B)) for appli19 cable beneficiaries for a year shall be es20 tablished in a manner that does not result 

21 in spending more for such entity for such 

22 beneficiaries than would otherwise be ex23 pended for such entity for such bene24 ficiaries for such year if the pilot program 


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1 were not implemented, as estimated by the 

2 Secretary. 

3 ‘‘(B) INCLUSION OF CERTAIN SERVICES.— 

4 A payment methodology tested under the pilot 

5 program shall include payment for the fur6 nishing of applicable services and other appro7 priate services, such as care coordination, medi8 cation reconciliation, discharge planning, transi9 tional care services, and other patient-centered 

10 activities as determined appropriate by the Sec11 retary. 

12 ‘‘(C) BUNDLED PAYMENTS.— 

13 ‘‘(i) IN GENERAL.—A bundled pay14 ment under the pilot program shall— 

15 ‘‘(I) be comprehensive, covering 

16 the costs of applicable services and 

17 other appropriate services furnished to 

18 an individual during an episode of 

19 care (as determined by the Secretary); 

20 and 

21 ‘‘(II) be made to the entity which 

22 is participating in the pilot program. 

23 ‘‘(ii) REQUIREMENT FOR PROVISION

24 OF APPLICABLE SERVICES AND OTHER AP25 PROPRIATE SERVICES.—Applicable services 


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1 and other appropriate services for which 

2 payment is made under this subparagraph 

3 shall be furnished or directed by the entity 

4 which is participating in the pilot program. 

5 ‘‘(D) PAYMENT FOR POST-ACUTE CARE

6 SERVICES AFTER THE EPISODE OF CARE.—The 

7 Secretary shall establish procedures, in the case 

8 where an applicable beneficiary requires contin9 ued post-acute care services after the last day 

10 of the episode of care, under which payment for 

11 such services shall be made. 

12 ‘‘(4) QUALITY MEASURES.— 

13 ‘‘(A) IN GENERAL.—The Secretary shall 

14 establish quality measures (including quality 

15 measures of process, outcome, and structure) 

16 related to care provided by entities participating 

17 in the pilot program. Quality measures estab18 lished under the preceding sentence shall in19 clude measures of the following: 

20 ‘‘(i) Functional status improvement. 

21 ‘‘(ii) Reducing rates of avoidable hos22 pital readmissions. 

23 ‘‘(iii) Rates of discharge to the com24 munity. 


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1 ‘‘(iv) Rates of admission to an emer2 gency room after a hospitalization. 

3 ‘‘(v) Incidence of health care acquired 

4 infections. 

5 ‘‘(vi) Efficiency measures. 

6 ‘‘(vii) Measures of patient7 centeredness of care. 

8 ‘‘(viii) Measures of patient perception 

9 of care. 

10 ‘‘(ix) Other measures, including meas11 ures of patient outcomes, determined ap12 propriate by the Secretary. 

13 ‘‘(B) REPORTING ON QUALITY MEAS14 URES.— 

15 ‘‘(i) IN GENERAL.—A entity shall sub16 mit data to the Secretary on quality meas17 ures established under subparagraph (A) 

18 during each year of the pilot program (in 

19 a form and manner, subject to clause (iii), 

20 specified by the Secretary). 

21 ‘‘(ii) SUBMISSION OF DATA THROUGH

22 ELECTRONIC HEALTH RECORD.—To the 

23 extent practicable, the Secretary shall 

24 specify that data on measures be sub25 mitted under clause (i) through the use of 


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1 an qualified electronic health record (as de2 fined in section 3000(13) of the Public 

3 Health Service Act (42 U.S.C. 300jj– 

4 11(13)) in a manner specified by the Sec5 retary. 

6 ‘‘(d) WAIVER.—The Secretary may waive such provi7 sions of this title and title XI as may be necessary to carry 

8 out the pilot program. 

9 ‘‘(e) INDEPENDENT EVALUATION AND REPORTS ON

10 PILOT PROGRAM.— 

11 ‘‘(1) INDEPENDENT EVALUATION.—The Sec12 retary shall conduct an independent evaluation of 

13 the pilot program, including the extent to which the 

14 pilot program has— 

15 ‘‘(A) improved quality measures estab16 lished under subsection (c)(4)(A); 

17 ‘‘(B) improved health outcomes; 

18 ‘‘(C) improved applicable beneficiary access 

19 to care; and 

20 ‘‘(D) reduced spending under this title. 

21 ‘‘(2) REPORTS.— 

22 ‘‘(A) INTERIM REPORT.—Not later than 2 

23 years after the implementation of the pilot pro24 gram, the Secretary shall submit to Congress a 


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1 report on the initial results of the independent 

2 evaluation conducted under paragraph (1). 

3 ‘‘(B) FINAL REPORT.—Not later than 3 

4 years after the implementation of the pilot pro5 gram, the Secretary shall submit to Congress a 

6 report on the final results of the independent 

7 evaluation conducted under paragraph (1). 

8 ‘‘(f) CONSULTATION.—The Secretary shall consult 

9 with representatives of small rural hospitals, including 

10 critical access hospitals (as defined in section 

11 1861(mm)(1)), regarding their participation in the pilot 

12 program. Such consultation shall include consideration of 

13 innovative methods of implementing bundled payments in 

14 hospitals described in the preceding sentence, taking into 

15 consideration any difficulties in doing so as a result of the 

16 low volume of services provided by such hospitals. 

17 ‘‘(g) IMPLEMENTATION PLAN.— 

18 ‘‘(1) IN GENERAL.—Not later than January 1, 

19 2016, the Secretary shall submit a plan for the im20 plementation of an expansion of the pilot program if 

21 the Secretary determines that such expansion will 

22 result in improving or not reducing the quality of 

23 patient care and reducing spending under this title. 

24 ‘‘(h) ADMINISTRATION.—Chapter 35 of title 44, 

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1 ing, and evaluation of models or the expansion of such 

2 models under this section.’’. 

3 SEC. 3024. INDEPENDENCE AT HOME DEMONSTRATION 

4 PROGRAM. 

5 Title XVIII of the Social Security Act is amended by 

6 inserting after section 1866D, as inserted by section 3023, 

7 the following new section: 

8 ‘‘INDEPENDENCE AT HOME MEDICAL PRACTICE

9 DEMONSTRATION PROGRAM

10 ‘‘SEC. 1866D. (a) ESTABLISHMENT.— 

11 ‘‘(1) IN GENERAL.—The Secretary shall con12 duct a demonstration program (in this section re13 ferred to as the ‘demonstration program’) to test a 

14 payment incentive and service delivery model that 

15 utilizes physician and nurse practitioner directed 

16 home-based primary care teams designed to reduce 

17 expenditures and improve health outcomes in the 

18 provision of items and services under this title to ap19 plicable beneficiaries (as defined in subsection (d)). 

20 ‘‘(2) REQUIREMENT.—The demonstration pro21 gram shall test whether a model described in para22 graph (1), which is accountable for providing com23 prehensive, coordinated, continuous, and accessible 

24 care to high-need populations at home and coordi25 nating health care across all treatment settings, re26 sults in— 


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1 ‘‘(A) reducing preventable hospitalizations; 

2 ‘‘(B) preventing hospital readmissions; 

3 ‘‘(C) reducing emergency room visits; 

4 ‘‘(D) improving health outcomes commen5 surate with the beneficiaries’ stage of chronic 

6 illness; 

7 ‘‘(E) improving the efficiency of care, such 

8 as by reducing duplicative diagnostic and lab9 oratory tests; 

10 ‘‘(F) reducing the cost of health care serv11 ices covered under this title; and 

12 ‘‘(G) achieving beneficiary and family care13 giver satisfaction. 

14 ‘‘(b) INDEPENDENCE AT HOME MEDICAL PRAC15 TICE.— 

16 ‘‘(1) INDEPENDENCE AT HOME MEDICAL PRAC17 TICE DEFINED.—In this section: 

18 ‘‘(A) IN GENERAL.—The term ‘independ19 ence at home medical practice’ means a legal 

20 entity that— 

21 ‘‘(i) is comprised of an individual phy22 sician or nurse practitioner or group of 

23 physicians and nurse practitioners that 

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1 ants, pharmacists, and other health and 

2 social services staff as appropriate who 

3 have experience providing home-based pri4 mary care to applicable beneficiaries, make 

5 in-home visits, and are available 24 hours 

6 per day, 7 days per week to carry out 

7 plans of care that are tailored to the indi8 vidual beneficiary’s chronic conditions and 

9 designed to achieve the results in sub10 section (a); 

11 ‘‘(ii) is organized at least in part for 

12 the purpose of providing physicians’ serv13 ices; 

14 ‘‘(iii) has documented experience in 

15 providing home-based primary care serv16 ices to high-cost chronically ill bene17 ficiaries, as determined appropriate by the 

18 Secretary; 

19 ‘‘(iv) furnishes services to at least 200 

20 applicable beneficiaries (as defined in sub21 section (d)) during each year of the dem22 onstration program; 

23 ‘‘(v) has entered into an agreement 

24 with the Secretary; 


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1 ‘‘(vi) uses electronic health informa2 tion systems, remote monitoring, and mo3 bile diagnostic technology; and 

4 ‘‘(vii) meets such other criteria as the 

5 Secretary determines to be appropriate to 

6 participate in the demonstration program. 

7 The entity shall report on quality measures (in 

8 such form, manner, and frequency as specified 

9 by the Secretary, which may be for the group, 

10 for providers of services and suppliers, or both) 

11 and report to the Secretary (in a form, manner, 

12 and frequency as specified by the Secretary) 

13 such data as the Secretary determines appro14 priate to monitor and evaluate the demonstra15 tion program. 

16 ‘‘(B) PHYSICIAN.—The term ‘physician’ in17 cludes, except as the Secretary may otherwise 

18 provide, any individual who furnishes services 

19 for which payment may be made as physicians’ 

20 services and has the medical training or experi21 ence to fulfill the physician’s role described in 

22 subparagraph (A)(i). 

23 ‘‘(2) PARTICIPATION OF NURSE PRACTITIONERS

24 AND PHYSICIAN ASSISTANTS.—Nothing in this sec25 tion shall be construed to prevent a nurse practiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00767 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tioner or physician assistant from participating in, 

2 or leading, a home-based primary care team as part 

3 of an independence at home medical practice if— 

4 ‘‘(A) all the requirements of this section 

5 are met; 

6 ‘‘(B) the nurse practitioner or physician 

7 assistant, as the case may be, is acting con8 sistent with State law; and 

9 ‘‘(C) the nurse practitioner or physician 

10 assistant has the medical training or experience 

11 to fulfill the nurse practitioner or physician as12 sistant role described in paragraph (1)(A)(i). 

13 ‘‘(3) INCLUSION OF PROVIDERS AND PRACTI14 TIONERS.—Nothing in this subsection shall be con15 strued as preventing an independence at home med16 ical practice from including a provider of services or 

17 a participating practitioner described in section 

18 1842(b)(18)(C) that is affiliated with the practice 

19 under an arrangement structured so that such pro20 vider of services or practitioner participates in the 

21 demonstration program and shares in any savings 

22 under the demonstration program. 

23 ‘‘(4) QUALITY AND PERFORMANCE STAND24 ARDS.—The Secretary shall develop quality perform25 ance standards for independence at home medical 


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1 practices participating in the demonstration pro2 gram. 

3 ‘‘(c) PAYMENT METHODOLOGY.— 

4 ‘‘(1) ESTABLISHMENT OF TARGET SPENDING

5 LEVEL.—The Secretary shall establish an estimated 

6 annual spending target, for the amount the Sec7 retary estimates would have been spent in the ab8 sence of the demonstration, for items and services 

9 covered under parts A and B furnished to applicable 

10 beneficiaries for each qualifying independence at 

11 home medical practice under this section. Such 

12 spending targets shall be determined on a per capita 

13 basis. Such spending targets shall include a risk cor14 ridor that takes into account normal variation in ex15 penditures for items and services covered under 

16 parts A and B furnished to such beneficiaries with 

17 the size of the corridor being related to the number 

18 of applicable beneficiaries furnished services by each 

19 independence at home medical practice. The spend20 ing targets may also be adjusted for other factors as 

21 the Secretary determines appropriate. 

22 ‘‘(2) INCENTIVE PAYMENTS.—Subject to per23 formance on quality measures, a qualifying inde24 pendence at home medical practice is eligible to re25 ceive an incentive payment under this section if acVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00769 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tual expenditures for a year for the applicable bene2 ficiaries it enrolls are less than the estimated spend3 ing target established under paragraph (1) for such 

4 year. An incentive payment for such year shall be 

5 equal to a portion (as determined by the Secretary) 

6 of the amount by which actual expenditures (includ7 ing incentive payments under this paragraph) for 

8 applicable beneficiaries under parts A and B for 

9 such year are estimated to be less than 5 percent 

10 less than the estimated spending target for such 

11 year, as determined under paragraph (1). 

12 ‘‘(d) APPLICABLE BENEFICIARIES.— 

13 ‘‘(1) DEFINITION.—In this section, the term 

14 ‘applicable beneficiary’ means, with respect to a 

15 qualifying independence at home medical practice, 

16 an individual who the practice has determined— 

17 ‘‘(A) is entitled to benefits under part A 

18 and enrolled for benefits under part B; 

19 ‘‘(B) is not enrolled in a Medicare Advan20 tage plan under part C or a PACE program 

21 under section 1894; 

22 ‘‘(C) has 2 or more chronic illnesses, such 

23 as congestive heart failure, diabetes, other de24 mentias designated by the Secretary, chronic 

25 obstructive pulmonary disease, ischemic heart 


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1 disease, stroke, Alzheimer’s Disease and 

2 neurodegenerative diseases, and other diseases 

3 and conditions designated by the Secretary 

4 which result in high costs under this title; 

5 ‘‘(D) within the past 12 months has had a 

6 nonelective hospital admission; 

7 ‘‘(E) within the past 12 months has re8 ceived acute or subacute rehabilitation services; 

9 ‘‘(F) has 2 or more functional depend10 encies requiring the assistance of another per11 son (such as bathing, dressing, toileting, walk12 ing, or feeding); and 

13 ‘‘(G) meets such other criteria as the Sec14 retary determines appropriate. 

15 ‘‘(2) PATIENT ELECTION TO PARTICIPATE.— 

16 The Secretary shall determine an appropriate meth17 od of ensuring that applicable beneficiaries have 

18 agreed to enroll in an independence at home medical 

19 practice under the demonstration program. Enroll20 ment in the demonstration program shall be vol21 untary. 

22 ‘‘(3) BENEFICIARY ACCESS TO SERVICES.— 

23 Nothing in this section shall be construed as encour24 aging physicians or nurse practitioners to limit ap25 plicable beneficiary access to services covered under 


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1 this title and applicable beneficiaries shall not be re2 quired to relinquish access to any benefit under this 

3 title as a condition of receiving services from an 

4 independence at home medical practice. 

5 ‘‘(e) IMPLEMENTATION.— 

6 ‘‘(1) STARTING DATE.—The demonstration pro7 gram shall begin no later than January 1, 2012. An 

8 agreement with an independence at home medical 

9 practice under the demonstration program may 

10 cover not more than a 3-year period. 

11 ‘‘(2) NO PHYSICIAN DUPLICATION IN DEM12 ONSTRATION PARTICIPATION.—The Secretary shall 

13 not pay an independence at home medical practice 

14 under this section that participates in section 1899. 

15 ‘‘(3) NO BENEFICIARY DUPLICATION IN DEM16 ONSTRATION PARTICIPATION.—The Secretary shall 

17 ensure that no applicable beneficiary enrolled in an 

18 independence at home medical practice under this 

19 section is participating in the programs under sec20 tion 1899. 

21 ‘‘(4) PREFERENCE.—In approving an independ22 ence at home medical practice, the Secretary shall 

23 give preference to practices that are— 

24 ‘‘(A) located in high-cost areas of the 

25 country; 


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1 ‘‘(B) have experience in furnishing health 

2 care services to applicable beneficiaries in the 

3 home; and 

4 ‘‘(C) use electronic medical records, health 

5 information technology, and individualized plans 

6 of care. 

7 ‘‘(5) LIMITATION ON NUMBER OF PRACTICES.— 

8 In selecting qualified independence at home medical 

9 practices to participate under the demonstration pro10 gram, the Secretary shall limit the number of such 

11 practices so that the number of applicable bene12 ficiaries that may participate in the demonstration 

13 program does not exceed 10,000. 

14 ‘‘(6) WAIVER.—The Secretary may waive such 

15 provisions of this title and title XI as the Secretary 

16 determines necessary in order to implement the dem17 onstration program. 

18 ‘‘(7) ADMINISTRATION.—Chapter 35 of title 44, 

19 United States Code, shall not apply to this section. 

20 ‘‘(f) EVALUATION AND MONITORING.— 

21 ‘‘(1) IN GENERAL.—The Secretary shall evalu22 ate each independence at home medical practice 

23 under the demonstration program to assess whether 

24 the practice achieved the results described in sub25 section (a). 


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1 ‘‘(2) MONITORING APPLICABLE BENE2 FICIARIES.—The Secretary may monitor data on ex3 penditures and quality of services under this title 

4 after an applicable beneficiary discontinues receiving 

5 services under this title through a qualifying inde6 pendence at home medical practice. 

7 ‘‘(g) REPORTS TO CONGRESS.—The Secretary shall 

8 conduct an independent evaluation of the demonstration 

9 program and submit to Congress a final report, including 

10 best practices under the demonstration program. Such re11 port shall include an analysis of the demonstration pro12 gram on coordination of care, expenditures under this 

13 title, applicable beneficiary access to services, and the 

14 quality of health care services provided to applicable bene15 ficiaries. 

16 ‘‘(h) FUNDING.—For purposes of administering and 

17 carrying out the demonstration program, other than for 

18 payments for items and services furnished under this title 

19 and incentive payments under subsection (c), in addition 

20 to funds otherwise appropriated, there shall be transferred 

21 to the Secretary for the Center for Medicare & Medicaid 

22 Services Program Management Account from the Federal 

23 Hospital Insurance Trust Fund under section 1817 and 

24 the Federal Supplementary Medical Insurance Trust 

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1 propriate by the Secretary) $5,000,000 for each of fiscal 

2 years 2010 through 2015. Amounts transferred under this 

3 subsection for a fiscal year shall be available until ex4 pended. 

5 ‘‘(i) TERMINATION.— 

6 ‘‘(1) MANDATORY TERMINATION.—The Sec7 retary shall terminate an agreement with an inde8 pendence at home medical practice if— 

9 ‘‘(A) the Secretary estimates or determines 

10 that such practice will not receive an incentive 

11 payment for the second of 2 consecutive years 

12 under the demonstration program; or 

13 ‘‘(B) such practice fails to meet quality 

14 standards during any year of the demonstration 

15 program. 

16 ‘‘(2) PERMISSIVE TERMINATION.—The Sec17 retary may terminate an agreement with an inde18 pendence at home medical practice for such other 

19 reasons determined appropriate by the Secretary.’’. 

20 SEC. 3025. HOSPITAL READMISSIONS REDUCTION PRO21 GRAM. 

22 (a) IN GENERAL.—Section 1886 of the Social Secu23 rity Act (42 U.S.C. 1395ww), as amended by sections 

24 3001 and 3008, is amended by adding at the end the fol25 lowing new subsection: 


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1 ‘‘(q) HOSPITAL READMISSIONS REDUCTION PRO2 GRAM.— 

3 ‘‘(1) IN GENERAL.—With respect to payment 

4 for discharges from an applicable hospital (as de5 fined in paragraph (5)(C)) occurring during a fiscal 

6 year beginning on or after October 1, 2012, in order 

7 to account for excess readmissions in the hospital, 

8 the Secretary shall reduce the payments that would 

9 otherwise be made to such hospital under subsection 

10 (d) (or section 1814(b)(3), as the case may be) for 

11 such a discharge by an amount equal to the product 

12 of— 

13 ‘‘(A) the base operating DRG payment 

14 amount (as defined in paragraph (2)) for the 

15 discharge; and 

16 ‘‘(B) the adjustment factor (described in 

17 paragraph (3)(A)) for the hospital for the fiscal 

18 year. 

19 ‘‘(2) BASE OPERATING DRG PAYMENT AMOUNT

20 DEFINED.— 

21 ‘‘(A) IN GENERAL.—Except as provided in 

22 subparagraph (B), in this subsection, the term 

23 ‘base operating DRG payment amount’ means, 

24 with respect to a hospital for a fiscal year— 


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1 ‘‘(i) the payment amount that would 

2 otherwise be made under subsection (d) 

3 (determined without regard to subsection 

4 (o)) for a discharge if this subsection did 

5 not apply; reduced by 

6 ‘‘(ii) any portion of such payment 

7 amount that is attributable to payments 

8 under paragraphs (5)(A), (5)(B), (5)(F), 

9 and (12) of subsection (d). 

10 ‘‘(B) SPECIAL RULES FOR CERTAIN HOS11 PITALS.— 

12 ‘‘(i) SOLE COMMUNITY HOSPITALS

13 AND MEDICARE-DEPENDENT, SMALL

14 RURAL HOSPITALS.—In the case of a medi15 care-dependent, small rural hospital (with 

16 respect to discharges occurring during fis17 cal years 2012 and 2013) or a sole com18 munity hospital, in applying subparagraph 

19 (A)(i), the payment amount that would 

20 otherwise be made under subsection (d) 

21 shall be determined without regard to sub22 paragraphs (I) and (L) of subsection 

23 (b)(3) and subparagraphs (D) and (G) of 

24 subsection (d)(5). 


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1 ‘‘(ii) HOSPITALS PAID UNDER SEC2 TION 1814.—In the case of a hospital that 

3 is paid under section 1814(b)(3), the Sec4 retary may exempt such hospitals provided 

5 that States paid under such section submit 

6 an annual report to the Secretary describ7 ing how a similar program in the State for 

8 a participating hospital or hospitals 

9 achieves or surpasses the measured results 

10 in terms of patient health outcomes and 

11 cost savings established herein with respect 

12 to this section. 

13 ‘‘(3) ADJUSTMENT FACTOR.— 

14 ‘‘(A) IN GENERAL.—For purposes of para15 graph (1), the adjustment factor under this 

16 paragraph for an applicable hospital for a fiscal 

17 year is equal to the greater of— 

18 ‘‘(i) the ratio described in subpara19 graph (B) for the hospital for the applica20 ble period (as defined in paragraph (5)(D)) 

21 for such fiscal year; or 

22 ‘‘(ii) the floor adjustment factor speci23 fied in subparagraph (C). 


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1 ‘‘(B) RATIO.—The ratio described in this 

2 subparagraph for a hospital for an applicable 

3 period is equal to 1 minus the ratio of— 

4 ‘‘(i) the aggregate payments for ex5 cess readmissions (as defined in paragraph 

6 (4)(A)) with respect to an applicable hos7 pital for the applicable period; and 

8 ‘‘(ii) the aggregate payments for all 

9 discharges (as defined in paragraph 

10 (4)(B)) with respect to such applicable 

11 hospital for such applicable period. 

12 ‘‘(C) FLOOR ADJUSTMENT FACTOR.—For 

13 purposes of subparagraph (A), the floor adjust14 ment factor specified in this subparagraph 

15 for— 

16 ‘‘(i) fiscal year 2013 is 0.99; 

17 ‘‘(ii) fiscal year 2014 is 0.98; or 

18 ‘‘(iii) fiscal year 2015 and subsequent 

19 fiscal years is 0.97. 

20 ‘‘(4) AGGREGATE PAYMENTS, EXCESS READMIS21 SION RATIO DEFINED.—For purposes of this sub22 section: 

23 ‘‘(A) AGGREGATE PAYMENTS FOR EXCESS

24 READMISSIONS.—The term ‘aggregate payments 

25 for excess readmissions’ means, for a hospital 


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1 for an applicable period, the sum, for applicable 

2 conditions (as defined in paragraph (5)(A)), of 

3 the product, for each applicable condition, of— 

4 ‘‘(i) the base operating DRG payment 

5 amount for such hospital for such applica6 ble period for such condition; 

7 ‘‘(ii) the number of admissions for 

8 such condition for such hospital for such 

9 applicable period; and 

10 ‘‘(iii) the excess readmissions ratio (as 

11 defined in subparagraph (C)) for such hos12 pital for such applicable period minus 1. 

13 ‘‘(B) AGGREGATE PAYMENTS FOR ALL DIS14 CHARGES.—The term ‘aggregate payments for 

15 all discharges’ means, for a hospital for an ap16 plicable period, the sum of the base operating 

17 DRG payment amounts for all discharges for 

18 all conditions from such hospital for such appli19 cable period. 

20 ‘‘(C) EXCESS READMISSION RATIO.— 

21 ‘‘(i) IN GENERAL.—Subject to clause 

22 (ii), the term ‘excess readmissions ratio’ 

23 means, with respect to an applicable condi24 tion for a hospital for an applicable period, 

25 the ratio (but not less than 1.0) of— 


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1 ‘‘(I) the risk adjusted readmis2 sions based on actual readmissions, as 

3 determined consistent with a readmis4 sion measure methodology that has 

5 been endorsed under paragraph 

6 (5)(A)(ii)(I), for an applicable hospital 

7 for such condition with respect to 

8 such applicable period; to 

9 ‘‘(II) the risk adjusted expected 

10 readmissions (as determined con11 sistent with such a methodology) for 

12 such hospital for such condition with 

13 respect to such applicable period. 

14 ‘‘(ii) EXCLUSION OF CERTAIN RE15 ADMISSIONS.—For purposes of clause (i), 

16 with respect to a hospital, excess readmis17 sions shall not include readmissions for an 

18 applicable condition for which there are 

19 fewer than a minimum number (as deter20 mined by the Secretary) of discharges for 

21 such applicable condition for the applicable 

22 period and such hospital. 

23 ‘‘(5) DEFINITIONS.—For purposes of this sub24 section: 


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1 ‘‘(A) APPLICABLE CONDITION.—The term 

2 ‘applicable condition’ means, subject to sub3 paragraph (B), a condition or procedure se4 lected by the Secretary among conditions and 

5 procedures for which— 

6 ‘‘(i) readmissions (as defined in sub7 paragraph (E)) that represent conditions 

8 or procedures that are high volume or high 

9 expenditures under this title (or other cri10 teria specified by the Secretary); and 

11 ‘‘(ii) measures of such readmissions— 

12 ‘‘(I) have been endorsed by the 

13 entity with a contract under section 

14 1890(a); and 

15 ‘‘(II) such endorsed measures 

16 have exclusions for readmissions that 

17 are unrelated to the prior discharge 

18 (such as a planned readmission or 

19 transfer to another applicable hos20 pital). 

21 ‘‘(B) EXPANSION OF APPLICABLE CONDI22 TIONS.—Beginning with fiscal year 2015, the 

23 Secretary shall, to the extent practicable, ex24 pand the applicable conditions beyond the 3 

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1 dorsed as described in subparagraph (A)(ii)(I) 

2 as of the date of the enactment of this sub3 section to the additional 4 conditions that have 

4 been identified by the Medicare Payment Advi5 sory Commission in its report to Congress in 

6 June 2007 and to other conditions and proce7 dures as determined appropriate by the Sec8 retary. In expanding such applicable conditions, 

9 the Secretary shall seek the endorsement de10 scribed in subparagraph (A)(ii)(I) but may 

11 apply such measures without such an endorse12 ment in the case of a specified area or medical 

13 topic determined appropriate by the Secretary 

14 for which a feasible and practical measure has 

15 not been endorsed by the entity with a contract 

16 under section 1890(a) as long as due consider17 ation is given to measures that have been en18 dorsed or adopted by a consensus organization 

19 identified by the Secretary. 

20 ‘‘(C) APPLICABLE HOSPITAL.—The term 

21 ‘applicable hospital’ means a subsection (d) hos22 pital or a hospital that is paid under section 

23 1814(b)(3), as the case may be. 


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1 ‘‘(D) APPLICABLE PERIOD.—The term ‘ap2 plicable period’ means, with respect to a fiscal 

3 year, such period as the Secretary shall specify. 

4 ‘‘(E) READMISSION.—The term ‘readmis5 sion’ means, in the case of an individual who is 

6 discharged from an applicable hospital, the ad7 mission of the individual to the same or another 

8 applicable hospital within a time period speci9 fied by the Secretary from the date of such dis10 charge. Insofar as the discharge relates to an 

11 applicable condition for which there is an en12 dorsed measure described in subparagraph 

13 (A)(ii)(I), such time period (such as 30 days) 

14 shall be consistent with the time period speci15 fied for such measure. 

16 ‘‘(6) REPORTING HOSPITAL SPECIFIC INFORMA17 TION.— 

18 ‘‘(A) IN GENERAL.—The Secretary shall 

19 make information available to the public re20 garding readmission rates of each subsection 

21 (d) hospital under the program. 

22 ‘‘(B) OPPORTUNITY TO REVIEW AND SUB23 MIT CORRECTIONS.—The Secretary shall ensure 

24 that a subsection (d) hospital has the oppor25 tunity to review, and submit corrections for, the 


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1 information to be made public with respect to 

2 the hospital under subparagraph (A) prior to 

3 such information being made public. 

4 ‘‘(C) WEBSITE.—Such information shall be 

5 posted on the Hospital Compare Internet 

6 website in an easily understandable format. 

7 ‘‘(7) LIMITATIONS ON REVIEW.—There shall be 

8 no administrative or judicial review under section 

9 1869, section 1878, or otherwise of the following: 

10 ‘‘(A) The determination of base operating 

11 DRG payment amounts. 

12 ‘‘(B) The methodology for determining the 

13 adjustment factor under paragraph (3), includ14 ing excess readmissions ratio under paragraph 

15 (4)(C), aggregate payments for excess readmis16 sions under paragraph (4)(A), and aggregate 

17 payments for all discharges under paragraph 

18 (4)(B), and applicable periods and applicable 

19 conditions under paragraph (5). 

20 ‘‘(C) The measures of readmissions as de21 scribed in paragraph (5)(A)(ii). 

22 ‘‘(8) READMISSION RATES FOR ALL PA23 TIENTS.— 

24 ‘‘(A) CALCULATION OF READMISSION.— 

25 The Secretary shall calculate readmission rates 


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1 for all patients (as defined in subparagraph 

2 (D)) for a specified hospital (as defined in sub3 paragraph (D)(ii)) for an applicable condition 

4 (as defined in paragraph (5)(B)) and other con5 ditions deemed appropriate by the Secretary for 

6 an applicable period (as defined in paragraph 

7 (5)(D)) in the same manner as used to cal8 culate such readmission rates for hospitals with 

9 respect to this title and posted on the CMS 

10 Hospital Compare website. 

11 ‘‘(B) POSTING OF HOSPITAL SPECIFIC ALL

12 PATIENT READMISSION RATES.—The Secretary 

13 shall make information on all patient readmis14 sion rates calculated under subparagraph (A) 

15 available on the CMS Hospital Compare website 

16 in a form and manner determined appropriate 

17 by the Secretary. The Secretary may also make 

18 other information determined appropriate by 

19 the Secretary available on such website. 

20 ‘‘(C) HOSPITAL SUBMISSION OF ALL PA21 TIENT DATA.— 

22 ‘‘(i) Except as provided for in clause 

23 (ii), each specified hospital (as defined in 

24 subparagraph (D)(ii)) shall submit to the 

25 Secretary, in a form, manner and time 


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1 specified by the Secretary, data and infor2 mation determined necessary by the Sec3 retary for the Secretary to calculate the all 

4 patient readmission rates described in sub5 paragraph (A). 

6 ‘‘(ii) Instead of a specified hospital 

7 submitting to the Secretary the data and 

8 information described in clause (i), such 

9 data and information may be submitted to 

10 the Secretary, on behalf of such a specified 

11 hospital, by a state or an entity determined 

12 appropriate by the Secretary. 

13 ‘‘(D) DEFINITIONS.—For purposes of this 

14 paragraph: 

15 ‘‘(i) The term ‘all patients’ means pa16 tients who are treated on an inpatient 

17 basis and discharged from a specified hos18 pital (as defined in clause (ii)). 

19 ‘‘(ii) The term ‘specified hospital’ 

20 means a subsection (d) hospital, hospitals 

21 described in clauses (i) through (v) of sub22 section (d)(1)(B) and, as determined fea23 sible and appropriate by the Secretary, 

24 other hospitals not otherwise described in 

25 this subparagraph.’’. 


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1 (b) QUALITY IMPROVEMENT.—Part S of title III of 

2 the Public Health Service Act, as amended by section 

3 3015, is further amended by adding at the end the fol4 lowing: 

5 ‘‘SEC. 399KK. QUALITY IMPROVEMENT PROGRAM FOR HOS6 PITALS WITH A HIGH SEVERITY ADJUSTED 

7 READMISSION RATE. 

8 ‘‘(a) ESTABLISHMENT.— 

9 ‘‘(1) IN GENERAL.—Not later than 2 years 

10 after the date of enactment of this section, the Sec11 retary shall make available a program for eligible 

12 hospitals to improve their readmission rates through 

13 the use of patient safety organizations (as defined in 

14 section 921(4)). 

15 ‘‘(2) ELIGIBLE HOSPITAL DEFINED.—In this 

16 subsection, the term ‘eligible hospital’ means a hos17 pital that the Secretary determines has a high rate 

18 of risk adjusted readmissions for the conditions de19 scribed in section 1886(q)(8)(A) of the Social Secu20 rity Act and has not taken appropriate steps to re21 duce such readmissions and improve patient safety 

22 as evidenced through historically high rates of re23 admissions, as determined by the Secretary. 


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1 ‘‘(3) RISK ADJUSTMENT.—The Secretary shall 

2 utilize appropriate risk adjustment measures to de3 termine eligible hospitals. 

4 ‘‘(b) REPORT TO THE SECRETARY.—As determined 

5 appropriate by the Secretary, eligible hospitals and patient 

6 safety organizations working with those hospitals shall re7 port to the Secretary on the processes employed by the 

8 hospital to improve readmission rates and the impact of 

9 such processes on readmission rates.’’. 

10 SEC. 3026. COMMUNITY-BASED CARE TRANSITIONS PRO11 GRAM. 

12 (a) IN GENERAL.—The Secretary shall establish a 

13 Community-Based Care Transitions Program under which 

14 the Secretary provides funding to eligible entities that fur15 nish improved care transition services to high-risk Medi16 care beneficiaries. 

17 (b) DEFINITIONS.—In this section: 

18 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti19 ty’’ means the following: 

20 (A) A subsection (d) hospital (as defined in 

21 section 1886(d)(1)(B) of the Social Security 

22 Act (42 U.S.C. 1395ww(d)(1)(B))) identified by 

23 the Secretary as having a high readmission 

24 rate, such as under section 1886(q) of the So25 cial Security Act, as added by section 3025. 


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1 (B) An appropriate community-based orga2 nization that provides care transition services 

3 under this section across a continuum of care 

4 through arrangements with subsection (d) hos5 pitals (as so defined) to furnish the services de6 scribed in subsection (c)(2)(B)(i) and whose 

7 governing body includes sufficient representa8 tion of multiple health care stakeholders (in9 cluding consumers). 

10 (2) HIGH-RISK MEDICARE BENEFICIARY.—The 

11 term ‘‘high-risk Medicare beneficiary’’ means a 

12 Medicare beneficiary who has attained a minimum 

13 hierarchical condition category score, as determined 

14 by the Secretary, based on a diagnosis of multiple 

15 chronic conditions or other risk factors associated 

16 with a hospital readmission or substandard transi17 tion into post-hospitalization care, which may in18 clude 1 or more of the following: 

19 (A) Cognitive impairment. 

20 (B) Depression. 

21 (C) A history of multiple readmissions. 

22 (D) Any other chronic disease or risk fac23 tor as determined by the Secretary. 

24 (3) MEDICARE BENEFICIARY.—The term 

25 ‘‘Medicare beneficiary’’ means an individual who is 


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1 entitled to benefits under part A of title XVIII of 

2 the Social Security Act (42 U.S.C. 1395 et seq.) and 

3 enrolled under part B of such title, but not enrolled 

4 under part C of such title. 

5 (4) PROGRAM.—The term ‘‘program’’ means 

6 the program conducted under this section. 

7 (5) READMISSION.—The term ‘‘readmission’’ 

8 has the meaning given such term in section 

9 1886(q)(5)(E) of the Social Security Act, as added 

10 by section 3025. 

11 (6) SECRETARY.—The term ‘‘Secretary’’ means 

12 the Secretary of Health and Human Services. 

13 (c) REQUIREMENTS.— 

14 (1) DURATION.— 

15 (A) IN GENERAL.—The program shall be 

16 conducted for a 5-year period, beginning Janu17 ary 1, 2011. 

18 (B) EXPANSION.—The Secretary may ex19 pand the duration and the scope of the pro20 gram, to the extent determined appropriate by 

21 the Secretary, if the Secretary determines (and 

22 the Chief Actuary of the Centers for Medicare 

23 & Medicaid Services, with respect to spending 

24 under this title, certifies) that such expansion 


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1 would reduce spending under this title without 

2 reducing quality. 

3 (2) APPLICATION; PARTICIPATION.— 

4 (A) IN GENERAL.— 

5 (i) APPLICATION.—An eligible entity 

6 seeking to participate in the program shall 

7 submit an application to the Secretary at 

8 such time, in such manner, and containing 

9 such information as the Secretary may re10 quire. 

11 (ii) PARTNERSHIP.—If an eligible en12 tity is a hospital, such hospital shall enter 

13 into a partnership with a community-based 

14 organization to participate in the program. 

15 (B) INTERVENTION PROPOSAL.—Subject 

16 to subparagraph (C), an application submitted 

17 under subparagraph (A)(i) shall include a de18 tailed proposal for at least 1 care transition 

19 intervention, which may include the following: 

20 (i) Initiating care transition services 

21 for a high-risk Medicare beneficiary not 

22 later than 24 hours prior to the discharge 

23 of the beneficiary from the eligible entity. 

24 (ii) Arranging timely post-discharge 

25 follow-up services to the high-risk Medicare 


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1 beneficiary to provide the beneficiary (and, 

2 as appropriate, the primary caregiver of 

3 the beneficiary) with information regarding 

4 responding to symptoms that may indicate 

5 additional health problems or a deterio6 rating condition. 

7 (iii) Providing the high-risk Medicare 

8 beneficiary (and, as appropriate, the pri9 mary caregiver of the beneficiary) with as10 sistance to ensure productive and timely 

11 interactions between patients and post12 acute and outpatient providers. 

13 (iv) Assessing and actively engaging 

14 with a high-risk Medicare beneficiary (and, 

15 as appropriate, the primary caregiver of 

16 the beneficiary) through the provision of 

17 self-management support and relevant in18 formation that is specific to the bene19 ficiary’s condition. 

20 (v) Conducting comprehensive medica21 tion review and management (including, if 

22 appropriate, counseling and self-manage23 ment support). 

24 (C) LIMITATION.—A care transition inter25 vention proposed under subparagraph (B) may 


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1 not include payment for services required under 

2 the discharge planning process described in sec3 tion 1861(ee) of the Social Security Act (42 

4 U.S.C. 1395x(ee)). 

5 (3) SELECTION.—In selecting eligible entities to 

6 participate in the program, the Secretary shall give 

7 priority to eligible entities that— 

8 (A) participate in a program administered 

9 by the Administration on Aging to provide con10 current care transitions interventions with mul11 tiple hospitals and practitioners; or 

12 (B) provide services to medically under13 served populations, small communities, and 

14 rural areas. 

15 (d) IMPLEMENTATION.—Notwithstanding any other 

16 provision of law, the Secretary may implement the provi17 sions of this section by program instruction or otherwise. 

18 (e) WAIVER AUTHORITY.—The Secretary may waive 

19 such requirements of titles XI and XVIII of the Social 

20 Security Act as may be necessary to carry out the pro21 gram. 

22 (f) FUNDING.—For purposes of carrying out this sec23 tion, the Secretary of Health and Human Services shall 

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1 rity Act (42 U.S.C. 1395i) and the Federal Supple2 mentary Medical Insurance Trust Fund under section 

3 1841 of such Act (42 U.S.C. 1395t), in such proportion 

4 as the Secretary determines appropriate, of $500,000,000, 

5 to the Centers for Medicare & Medicaid Services Program 

6 Management Account for the period of fiscal years 2011 

7 through 2015. Amounts transferred under the preceding 

8 sentence shall remain available until expended. 

9 SEC. 3027. EXTENSION OF GAINSHARING DEMONSTRATION. 

10 (a) IN GENERAL.—Subsection (d)(3) of section 5007 

11 of the Deficit Reduction Act of 2005 (Public Law 109– 

12 171) is amended by inserting ‘‘(or September 30, 2011, 

13 in the case of a demonstration project in operation as of 

14 October 1, 2008)’’ after ‘‘December 31, 2009’’. 

15 (b) FUNDING.— 

16 (1) IN GENERAL.—Subsection (f)(1) of such 

17 section is amended by inserting ‘‘and for fiscal year 

18 2010, $1,600,000,’’ after ‘‘$6,000,000,’’. 

19 (2) AVAILABILITY.—Subsection (f)(2) of such 

20 section is amended by striking ‘‘2010’’ and inserting 

21 ‘‘2014 or until expended’’. 

22 (c) REPORTS.— 

23 (1) QUALITY IMPROVEMENT AND SAVINGS.— 

24 Subsection (e)(3) of such section is amended by 


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1 striking ‘‘December 1, 2008’’ and inserting ‘‘March 

2 31, 2011’’. 

3 (2) FINAL REPORT.—Subsection (e)(4) of such 

4 section is amended by striking ‘‘May 1, 2010’’ and 

5 inserting ‘‘March 31, 2013’’. 

6 Subtitle B—Improving Medicare 

7 for Patients and Providers 

8 PART I—ENSURING BENEFICIARY ACCESS TO 

9 PHYSICIAN CARE AND OTHER SERVICES 

10 SEC. 3101. INCREASE IN THE PHYSICIAN PAYMENT UPDATE. 

11 Section 1848(d) of the Social Security Act (42 U.S.C. 

12 1395w–4(d)) is amended by adding at the end the fol13 lowing new paragraph: 

14 ‘‘(10) UPDATE FOR 2010.— 

15 ‘‘(A) IN GENERAL.—Subject to paragraphs 

16 (7)(B), (8)(B), and (9)(B), in lieu of the update 

17 to the single conversion factor established in 

18 paragraph (1)(C) that would otherwise apply 

19 for 2010, the update to the single conversion 

20 factor shall be 0.5 percent. 

21 ‘‘(B) NO EFFECT ON COMPUTATION OF

22 CONVERSION FACTOR FOR 2011 AND SUBSE23 QUENT YEARS.—The conversion factor under 

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1 graph (1)(A) for 2011 and subsequent years as 

2 if subparagraph (A) had never applied.’’. 

3 SEC. 3102. EXTENSION OF THE WORK GEOGRAPHIC INDEX 

4 FLOOR AND REVISIONS TO THE PRACTICE 

5 EXPENSE GEOGRAPHIC ADJUSTMENT UNDER 

6 THE MEDICARE PHYSICIAN FEE SCHEDULE. 

7 (a) EXTENSION OF WORK GPCI FLOOR.—Section 

8 1848(e)(1)(E) of the Social Security Act (42 U.S.C. 

9 1395w–4(e)(1)(E)) is amended by striking ‘‘before Janu10 ary 1, 2010’’ and inserting ‘‘before January 1, 2011’’. 

11 (b) PRACTICE EXPENSE GEOGRAPHIC ADJUSTMENT

12 FOR 2010 AND SUBSEQUENT YEARS.—Section 1848(e)(1) 

13 of the Social Security Act (42 U.S.C. 1395w4(e)(1)) is 

14 amended— 

15 (1) in subparagraph (A), by striking ‘‘and (G)’’ 

16 and inserting ‘‘(G), and (H)’’; and 

17 (2) by adding at the end the following new sub18 paragraph: 

19 ‘‘(H) PRACTICE EXPENSE GEOGRAPHIC

20 ADJUSTMENT FOR 2010 AND SUBSEQUENT

21 YEARS.— 

22 ‘‘(i) FOR 2010.—Subject to clause (iii), 

23 for services furnished during 2010, the em24 ployee wage and rent portions of the prac25 tice expense geographic index described in 


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subparagraph (A)(i) shall reflect 3 1 ⁄4 of the 

2 difference between the relative costs of em3 ployee wages and rents in each of the dif4 ferent fee schedule areas and the national 

5 average of such employee wages and rents. 

6 ‘‘(ii) FOR 2011.—Subject to clause 

7 (iii), for services furnished during 2011, 

8 the employee wage and rent portions of the 

9 practice expense geographic index de10 scribed in subparagraph (A)(i) shall reflect 

1 11 ⁄2 of the difference between the relative 

12 costs of employee wages and rents in each 

13 of the different fee schedule areas and the 

14 national average of such employee wages 

15 and rents. 

16 ‘‘(iii) HOLD HARMLESS.—The practice 

17 expense portion of the geographic adjust18 ment factor applied in a fee schedule area 

19 for services furnished in 2010 or 2011 

20 shall not, as a result of the application of 

21 clause (i) or (ii), be reduced below the 

22 practice expense portion of the geographic 

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1 tion of such clause (i) or (ii), respectively) 

2 for such area for such year. 

3 ‘‘(iv) ANALYSIS.—The Secretary shall 

4 analyze current methods of establishing 

5 practice expense geographic adjustments 

6 under subparagraph (A)(i) and evaluate 

7 data that fairly and reliably establishes 

8 distinctions in the costs of operating a 

9 medical practice in the different fee sched10 ule areas. Such analysis shall include an 

11 evaluation of the following: 

12 ‘‘(I) The feasibility of using ac13 tual data or reliable survey data devel14 oped by medical organizations on the 

15 costs of operating a medical practice, 

16 including office rents and non-physi17 cian staff wages, in different fee 

18 schedule areas. 

19 ‘‘(II) The office expense portion 

20 of the practice expense geographic ad21 justment described in subparagraph 

22 (A)(i), including the extent to which 

23 types of office expenses are deter24 mined in local markets instead of na25 tional markets. 


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1 ‘‘(III) The weights assigned to 

2 each of the categories within the prac3 tice expense geographic adjustment 

4 described in subparagraph (A)(i). 

5 ‘‘(v) REVISION FOR 2012 AND SUBSE6 QUENT YEARS.—As a result of the analysis 

7 described in clause (iv), the Secretary 

8 shall, not later than January 1, 2012, 

9 make appropriate adjustments to the prac10 tice expense geographic adjustment de11 scribed in subparagraph (A)(i) to ensure 

12 accurate geographic adjustments across fee 

13 schedule areas, including— 

14 ‘‘(I) basing the office rents com15 ponent and its weight on office ex16 penses that vary among fee schedule 

17 areas; and 

18 ‘‘(II) considering a representative 

19 range of professional and non-profes20 sional personnel employed in a med21 ical office based on the use of the 

22 American Community Survey data or 

23 other reliable data for wage adjust24 ments. 


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1 Such adjustments shall be made without 

2 regard to adjustments made pursuant to 

3 clauses (i) and (ii) and shall be made in a 

4 budget neutral manner.’’. 

5 SEC. 3103. EXTENSION OF EXCEPTIONS PROCESS FOR 

6 MEDICARE THERAPY CAPS. 

7 Section 1833(g)(5) of the Social Security Act (42 

8 U.S.C. 1395l(g)(5)) is amended by striking ‘‘December 

9 31, 2009’’ and inserting ‘‘December 31, 2010’’. 

10 SEC. 3104. EXTENSION OF PAYMENT FOR TECHNICAL COM11 PONENT OF CERTAIN PHYSICIAN PATHOL12 OGY SERVICES. 

13 Section 542(c) of the Medicare, Medicaid, and 

14 SCHIP Benefits Improvement and Protection Act of 2000 

15 (as enacted into law by section 1(a)(6) of Public Law 106– 

16 554), as amended by section 732 of the Medicare Prescrip17 tion Drug, Improvement, and Modernization Act of 2003 

18 (42 U.S.C. 1395w–4 note), section 104 of division B of 

19 the Tax Relief and Health Care Act of 2006 (42 U.S.C. 

20 1395w–4 note), section 104 of the Medicare, Medicaid, 

21 and SCHIP Extension Act of 2007 (Public Law 110– 

22 173), and section 136 of the Medicare Improvements for 

23 Patients and Providers Act of 2008 (Public Law 110– 

24 275), is amended by striking ‘‘and 2009’’ and inserting 

25 ‘‘2009, and 2010’’. 


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1 SEC. 3105. EXTENSION OF AMBULANCE ADD-ONS. 

2 (a) GROUND AMBULANCE.—Section 1834(l)(13)(A) 

3 of the Social Security Act (42 U.S.C. 1395m(l)(13)(A)) 

4 is amended— 

5 (1) in the matter preceding clause (i)— 

6 (A) by striking ‘‘2007, and for’’ and in7 serting ‘‘2007, for’’; and 

8 (B) by striking ‘‘2010’’ and inserting 

9 ‘‘2010, and for such services furnished on or 

10 after April 1, 2010, and before January 1, 

11 2011,’’; and 

12 (2) in each of clauses (i) and (ii), by inserting 

13 ‘‘, and on or after April 1, 2010, and before January 

14 1, 2011’’ after ‘‘January 1, 2010’’ each place it ap15 pears. 

16 (b) AIR AMBULANCE.—Section 146(b)(1) of the 

17 Medicare Improvements for Patients and Providers Act of 

18 2008 (Public Law 110–275) is amended by striking ‘‘De19 cember 31, 2009’’ and inserting ‘‘December 31, 2009, and 

20 during the period beginning on April 1, 2010, and ending 

21 on January 1, 2011’’. 

22 (c) SUPER RURAL AMBULANCE.—Section 

23 1834(l)(12)(A) of the Social Security Act (42 U.S.C. 

24 1395m(l)(12)(A)) is amended by striking ‘‘2010’’ and in25 serting ‘‘2010, and on or after April 1, 2010, and before 

26 January 1, 2011’’. 


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1 SEC. 3106. EXTENSION OF CERTAIN PAYMENT RULES FOR 

2 LONG-TERM CARE HOSPITAL SERVICES AND 

3 OF MORATORIUM ON THE ESTABLISHMENT 

4 OF CERTAIN HOSPITALS AND FACILITIES. 

5 (a) EXTENSION OF CERTAIN PAYMENT RULES.— 

6 Section 114(c) of the Medicare, Medicaid, and SCHIP Ex7 tension Act of 2007 (42 U.S.C. 1395ww note), as amend8 ed by section 4302(a) of the American Recovery and Rein9 vestment Act (Public Law 111–5), is further amended by 

10 striking ‘‘3-year period’’ each place it appears and insert11 ing ‘‘4-year period’’. 

12 (b) EXTENSION OF MORATORIUM.—Section 

13 114(d)(1) of such Act (42 U.S.C. 1395ww note), in the 

14 matter preceding subparagraph (A), is amended by strik15 ing ‘‘3-year period’’ and inserting ‘‘4-year period’’. 

16 SEC. 3107. EXTENSION OF PHYSICIAN FEE SCHEDULE MEN17 TAL HEALTH ADD-ON. 

18 Section 138(a)(1) of the Medicare Improvements for 

19 Patients and Providers Act of 2008 (Public Law 110–275) 

20 is amended by striking ‘‘December 31, 2009’’ and insert21 ing ‘‘December 31, 2010’’. 

22 SEC. 3108. PERMITTING PHYSICIAN ASSISTANTS TO ORDER 

23 POST-HOSPITAL EXTENDED CARE SERVICES. 

24 (a) ORDERING POST-HOSPITAL EXTENDED CARE

25 SERVICES.— 


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1 (1) IN GENERAL.—Section 1814(a)(2) of the 

2 Social Security Act (42 U.S.C. 1395f(a)(2)), in the 

3 matter preceding subparagraph (A), is amended by 

4 striking ‘‘or clinical nurse specialist’’ and inserting 

5 ‘‘, a clinical nurse specialist, or a physician assistant 

6 (as those terms are defined in section 1861(aa)(5))’’ 

7 after ‘‘nurse practitioner’’. 

8 (2) CONFORMING AMENDMENT.—Section 

9 1814(a) of the Social Security Act (42 U.S.C. 

10 1395f(a)) is amended, in the second sentence, by 

11 striking ‘‘or clinical nurse specialist’’ and inserting 

12 ‘‘clinical nurse specialist, or physician assistant’’ 

13 after ‘‘nurse practitioner,’’. 

14 (b) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to items and services furnished on 

16 or after January 1, 2011. 

17 SEC. 3109. EXEMPTION OF CERTAIN PHARMACIES FROM 

18 ACCREDITATION REQUIREMENTS. 

19 (a) IN GENERAL.—Section 1834(a)(20) of the Social 

20 Security Act (42 U.S.C. 1395m(a)(20)), as added by sec21 tion 154(b)(1)(A) of the Medicare Improvements for Pa22 tients and Providers Act of 2008 (Public Law 100–275), 

23 is amended— 

24 (1) in subparagraph (F)(i)— 


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1 (A) by inserting ‘‘and subparagraph (G)’’ 

2 after ‘‘clause (ii)’’; and 

3 (B) by inserting ‘‘, except that the Sec4 retary shall not require a pharmacy to have 

5 submitted to the Secretary such evidence of ac6 creditation prior to January 1, 2011’’ before 

7 the semicolon at the end; and 

8 (2) by adding at the end the following new sub9 paragraph: 

10 ‘‘(G) APPLICATION OF ACCREDITATION RE11 QUIREMENT TO CERTAIN PHARMACIES.— 

12 ‘‘(i) IN GENERAL.—With respect to 

13 items and services furnished on or after 

14 January 1, 2011, in implementing quality 

15 standards under this paragraph— 

16 ‘‘(I) subject to subclause (II), in 

17 applying such standards and the ac18 creditation requirement of subpara19 graph (F)(i) with respect to phar20 macies described in clause (ii) fur21 nishing such items and services, such 

22 standards and accreditation require23 ment shall not apply to such phar24 macies; and 


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1 ‘‘(II) the Secretary may apply to 

2 such pharmacies an alternative ac3 creditation requirement established by 

4 the Secretary if the Secretary deter5 mines such alternative accreditation 

6 requirement is more appropriate for 

7 such pharmacies. 

8 ‘‘(ii) PHARMACIES DESCRIBED.—A 

9 pharmacy described in this clause is a 

10 pharmacy that meets each of the following 

11 criteria: 

12 ‘‘(I) The total billings by the 

13 pharmacy for such items and services 

14 under this title are less than 5 percent 

15 of total pharmacy sales, as determined 

16 based on the average total pharmacy 

17 sales for the previous 3 calendar 

18 years, 3 fiscal years, or other yearly 

19 period specified by the Secretary. 

20 ‘‘(II) The pharmacy has been en21 rolled under section 1866(j) as a sup22 plier of durable medical equipment, 

23 prosthetics, orthotics, and supplies, 

24 has been issued (which may include 

25 the renewal of) a provider number for 


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1 at least 5 years, and for which a final 

2 adverse action (as defined in section 

3 424.57(a) of title 42, Code of Federal 

4 Regulations) has not been imposed in 

5 the past 5 years. 

6 ‘‘(III) The pharmacy submits to 

7 the Secretary an attestation, in a 

8 form and manner, and at a time, 

9 specified by the Secretary, that the 

10 pharmacy meets the criteria described 

11 in subclauses (I) and (II). Such attes12 tation shall be subject to section 1001 

13 of title 18, United States Code. 

14 ‘‘(IV) The pharmacy agrees to 

15 submit materials as requested by the 

16 Secretary, or during the course of an 

17 audit conducted on a random sample 

18 of pharmacies selected annually, to 

19 verify that the pharmacy meets the 

20 criteria described in subclauses (I) 

21 and (II). Materials submitted under 

22 the preceding sentence shall include a 

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1 macy during the relevant periods, as 

2 requested by the Secretary.’’. 

3 (b) ADMINISTRATION.—Notwithstanding any other 

4 provision of law, the Secretary may implement the amend5 ments made by subsection (a) by program instruction or 

6 otherwise. 

7 (c) RULE OF CONSTRUCTION.—Nothing in the provi8 sions of or amendments made by this section shall be con9 strued as affecting the application of an accreditation re10 quirement for pharmacies to qualify for bidding in a com11 petitive acquisition area under section 1847 of the Social 

12 Security Act (42 U.S.C. 1395w–3). 

13 SEC. 3110. PART B SPECIAL ENROLLMENT PERIOD FOR DIS14 ABLED TRICARE BENEFICIARIES. 

15 (a) IN GENERAL.— 

16 (1) IN GENERAL.—Section 1837 of the Social 

17 Security Act (42 U.S.C. 1395p) is amended by add18 ing at the end the following new subsection: 

19 ‘‘(l)(1) In the case of any individual who is a covered 

20 beneficiary (as defined in section 1072(5) of title 10, 

21 United States Code) at the time the individual is entitled 

22 to part A under section 226(b) or section 226A and who 

23 is eligible to enroll but who has elected not to enroll (or 

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1 rollment period, there shall be a special enrollment period 

2 described in paragraph (2). 

3 ‘‘(2) The special enrollment period described in this 

4 paragraph, with respect to an individual, is the 12-month 

5 period beginning on the day after the last day of the initial 

6 enrollment period of the individual or, if later, the 12- 

7 month period beginning with the month the individual is 

8 notified of enrollment under this section. 

9 ‘‘(3) In the case of an individual who enrolls during 

10 the special enrollment period provided under paragraph 

11 (1), the coverage period under this part shall begin on the 

12 first day of the month in which the individual enrolls, or, 

13 at the option of the individual, the first month after the 

14 end of the individual’s initial enrollment period. 

15 ‘‘(4) An individual may only enroll during the special 

16 enrollment period provided under paragraph (1) one time 

17 during the individual’s lifetime. 

18 ‘‘(5) The Secretary shall ensure that the materials 

19 relating to coverage under this part that are provided to 

20 an individual described in paragraph (1) prior to the indi21 vidual’s initial enrollment period contain information con22 cerning the impact of not enrolling under this part, includ23 ing the impact on health care benefits under the 

24 TRICARE program under chapter 55 of title 10, United 

25 States Code. 


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1 ‘‘(6) The Secretary of Defense shall collaborate with 

2 the Secretary of Health and Human Services and the 

3 Commissioner of Social Security to provide for the accu4 rate identification of individuals described in paragraph 

5 (1). The Secretary of Defense shall provide such individ6 uals with notification with respect to this subsection. The 

7 Secretary of Defense shall collaborate with the Secretary 

8 of Health and Human Services and the Commissioner of 

9 Social Security to ensure appropriate follow up pursuant 

10 to any notification provided under the preceding sen11 tence.’’. 

12 (2) EFFECTIVE DATE.—The amendment made 

13 by paragraph (1) shall apply to elections made with 

14 respect to initial enrollment periods that end after 

15 the date of the enactment of this Act. 

16 (b) WAIVER OF INCREASE OF PREMIUM.—Section 

17 1839(b) of the Social Security Act (42 U.S.C. 1395r(b)) 

18 is amended by striking ‘‘section 1837(i)(4)’’ and inserting 

19 ‘‘subsection (i)(4) or (l) of section 1837’’. 

20 SEC. 3111. PAYMENT FOR BONE DENSITY TESTS. 

21 (a) PAYMENT.— 

22 (1) IN GENERAL.—Section 1848 of the Social 

23 Security Act (42 U.S.C. 1395w–4) is amended— 

24 (A) in subsection (b)— 


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1 (i) in paragraph (4)(B), by inserting 

2 ‘‘, and for 2010 and 2011, dual-energy x3 ray absorptiometry services (as described 

4 in paragraph (6))’’ before the period at the 

5 end; and 

6 (ii) by adding at the end the following 

7 new paragraph: 

8 ‘‘(6) TREATMENT OF BONE MASS SCANS.—For 

9 dual-energy x-ray absorptiometry services (identified 

10 in 2006 by HCPCS codes 76075 and 76077 (and 

11 any succeeding codes)) furnished during 2010 and 

12 2011, instead of the payment amount that would 

13 otherwise be determined under this section for such 

14 years, the payment amount shall be equal to 70 per15 cent of the product of— 

16 ‘‘(A) the relative value for the service (as 

17 determined in subsection (c)(2)) for 2006; 

18 ‘‘(B) the conversion factor (established 

19 under subsection (d)) for 2006; and 

20 ‘‘(C) the geographic adjustment factor (es21 tablished under subsection (e)(2)) for the serv22 ice for the fee schedule area for 2010 and 2011, 

23 respectively.’’; and 

24 (B) in subsection (c)(2)(B)(iv)— 


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1 (i) in subclause (II), by striking 

2 ‘‘and’’ at the end; 

3 (ii) in subclause (III), by striking the 

4 period at the end and inserting ‘‘; and’’; 

5 and 

6 (iii) by adding at the end the fol7 lowing new subclause: 

8 ‘‘(IV) subsection (b)(6) shall not 

9 be taken into account in applying 

10 clause (ii)(II) for 2010 or 2011.’’. 

11 (2) IMPLEMENTATION.—Notwithstanding any 

12 other provision of law, the Secretary may implement 

13 the amendments made by paragraph (1) by program 

14 instruction or otherwise. 

15 (b) STUDY AND REPORT BY THE INSTITUTE OF

16 MEDICINE.— 

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

18 Human Services is authorized to enter into an 

19 agreement with the Institute of Medicine of the Na20 tional Academies to conduct a study on the ramifica21 tions of Medicare payment reductions for dual-en22 ergy x-ray absorptiometry (as described in section 

23 1848(b)(6) of the Social Security Act, as added by 

24 subsection (a)(1)) during 2007, 2008, and 2009 on 

25 beneficiary access to bone mass density tests. 


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1 (2) REPORT.—An agreement entered into under 

2 paragraph (1) shall provide for the Institute of Med3 icine to submit to the Secretary and to Congress a 

4 report containing the results of the study conducted 

5 under such paragraph. 

6 SEC. 3112. REVISION TO THE MEDICARE IMPROVEMENT 

7 FUND. 

8 Section 1898(b)(1)(A) of the Social Security Act (42 

9 U.S.C. 1395iii) is amended by striking 

10 ‘‘$22,290,000,000’’ and inserting ‘‘$0’’. 

11 SEC. 3113. TREATMENT OF CERTAIN COMPLEX DIAGNOSTIC 

12 LABORATORY TESTS. 

13 (a) DEMONSTRATION PROJECT.— 

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

15 Human Services (in this section referred to as the 

16 ‘‘Secretary’’) shall conduct a demonstration project 

17 under part B title XVIII of the Social Security Act 

18 under which separate payments are made under 

19 such part for complex diagnostic laboratory tests 

20 provided to individuals under such part. Under the 

21 demonstration project, the Secretary shall establish 

22 appropriate payment rates for such tests. 

23 (2) COVERED COMPLEX DIAGNOSTIC LABORA24 TORY TEST DEFINED.—In this section, the term 


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1 ‘‘complex diagnostic laboratory test’’ means a diag2 nostic laboratory test— 

3 (A) that is an analysis of gene protein ex4 pression, topographic genotyping, or a cancer 

5 chemotherapy sensitivity assay; 

6 (B) that is determined by the Secretary to 

7 be a laboratory test for which there is not an 

8 alternative test having equivalent performance 

9 characteristics; 

10 (C) which is billed using a Health Care 

11 Procedure Coding System (HCPCS) code other 

12 than a not otherwise classified code under such 

13 Coding System; 

14 (D) which is approved or cleared by the 

15 Food and Drug Administration or is covered 

16 under title XVIII of the Social Security Act; 

17 and 

18 (E) is described in section 1861(s)(3) of 

19 the Social Security Act (42 U.S.C. 

20 1395x(s)(3)). 

21 (3) SEPARATE PAYMENT DEFINED.—In this 

22 section, the term ‘‘separate payment’’ means direct 

23 payment to a laboratory (including a hospital-based 

24 or independent laboratory) that performs a complex 

25 diagnostic laboratory test with respect to a specimen 


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1 collected from an individual during a period in which 

2 the individual is a patient of a hospital if the test 

3 is performed after such period of hospitalization and 

4 if separate payment would not otherwise be made 

5 under title XVIII of the Social Security Act by rea6 son of sections 1862(a)(14) and 1866(a)(1)(H)(i) of 

7 the such Act (42 U.S.C. 1395y(a)(14); 42 U.S.C. 

8 1395cc(a)(1)(H)(i)). 

9 (b) DURATION.—Subject to subsection (c)(2), the 

10 Secretary shall conduct the demonstration project under 

11 this section for the 2-year period beginning on July 1, 

12 2011. 

13 (c) PAYMENTS AND LIMITATION.—Payments under 

14 the demonstration project under this section shall— 

15 (1) be made from the Federal Supplemental 

16 Medical Insurance Trust Fund under section 1841 

17 of the Social Security Act (42 U.S.C. 1395t); and 

18 (2) may not exceed $100,000,000. 

19 (d) REPORT.—Not later than 2 years after the com20 pletion of the demonstration project under this section, the 

21 Secretary shall submit to Congress a report on the project. 

22 Such report shall include— 

23 (1) an assessment of the impact of the dem24 onstration project on access to care, quality of care, 

25 health outcomes, and expenditures under title XVIII 


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1 of the Social Security Act (including any savings 

2 under such title); and 

3 (2) such recommendations as the Secretary de4 termines appropriate. 

5 (e) IMPLEMENTATION FUNDING.—For purposes of 

6 administering this section (including preparing and sub7 mitting the report under subsection (d)), the Secretary 

8 shall provide for the transfer, from the Federal Supple9 mental Medical Insurance Trust Fund under section 1841 

10 of the Social Security Act (42 U.S.C. 1395t), to the Cen11 ters for Medicare & Medicaid Services Program Manage12 ment Account, of $5,000,000. Amounts transferred under 

13 the preceding sentence shall remain available until ex14 pended. 

15 SEC. 3114. IMPROVED ACCESS FOR CERTIFIED NURSE-MID16 WIFE SERVICES. 

17 Section 1833(a)(1)(K) of the Social Security Act (42 

18 U.S.C. 1395l(a)(1)(K)) is amended by inserting ‘‘(or 100 

19 percent for services furnished on or after January 1, 

20 2011)’’ after ‘‘1992, 65 percent’’. 


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1 PART II—RURAL PROTECTIONS 

2 SEC. 3121. EXTENSION OF OUTPATIENT HOLD HARMLESS 

3 PROVISION. 

4 (a) IN GENERAL.—Section 1833(t)(7)(D)(i) of the 

5 Social Security Act (42 U.S.C. 1395l(t)(7)(D)(i)) is 

6 amended— 

7 (1) in subclause (II)— 

8 (A) in the first sentence, by striking 

9 ‘‘2010’’and inserting ‘‘2011’’; and 

10 (B) in the second sentence, by striking ‘‘or 

11 2009’’ and inserting ‘‘, 2009, or 2010’’; and 

12 (2) in subclause (III), by striking ‘‘January 1, 

13 2010’’ and inserting ‘‘January 1, 2011’’. 

14 (b) PERMITTING ALL SOLE COMMUNITY HOSPITALS

15 TO BE ELIGIBLE FOR HOLD HARMLESS.—Section 

16 1833(t)(7)(D)(i)(III) of the Social Security Act (42 

17 U.S.C. 1395l(t)(7)(D)(i)(III)) is amended by adding at 

18 the end the following new sentence: ‘‘In the case of covered 

19 OPD services furnished on or after January 1, 2010, and 

20 before January 1, 2011, the preceding sentence shall be 

21 applied without regard to the 100-bed limitation.’’. 


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1 SEC. 3122. EXTENSION OF MEDICARE REASONABLE COSTS 

2 PAYMENTS FOR CERTAIN CLINICAL DIAG3 NOSTIC LABORATORY TESTS FURNISHED TO 

4 HOSPITAL PATIENTS IN CERTAIN RURAL 

5 AREAS. 

6 Section 416(b) of the Medicare Prescription Drug, 

7 Improvement, and Modernization Act of 2003 (42 U.S.C. 

8 1395l–4), as amended by section 105 of division B of the 

9 Tax Relief and Health Care Act of 2006 (42 U.S.C. 1395l 

10 note) and section 107 of the Medicare, Medicaid, and 

11 SCHIP Extension Act of 2007 (42 U.S.C. 1395l note), 

12 is amended by inserting ‘‘or during the 1-year period be13 ginning on July 1, 2010’’ before the period at the end. 

14 SEC. 3123. EXTENSION OF THE RURAL COMMUNITY HOS15 PITAL DEMONSTRATION PROGRAM. 

16 (a) ONE-YEAR EXTENSION.—Section 410A of the 

17 Medicare Prescription Drug, Improvement, and Mod18 ernization Act of 2003 (Public Law 108–173; 117 Stat. 

19 2272) is amended by adding at the end the following new 

20 subsection: 

21 ‘‘(g) ONE-YEAR EXTENSION OF DEMONSTRATION

22 PROGRAM.— 

23 ‘‘(1) IN GENERAL.—Subject to the succeeding 

24 provisions of this subsection, the Secretary shall con25 duct the demonstration program under this section 

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1 ferred to as the ‘1-year extension period’) that be2 gins on the date immediately following the last day 

3 of the initial 5-year period under subsection (a)(5). 

4 ‘‘(2) EXPANSION OF DEMONSTRATION

5 STATES.—Notwithstanding subsection (a)(2), during 

6 the 1-year extension period, the Secretary shall ex7 pand the number of States with low population den8 sities determined by the Secretary under such sub9 section to 20. In determining which States to include 

10 in such expansion, the Secretary shall use the same 

11 criteria and data that the Secretary used to deter12 mine the States under such subsection for purposes 

13 of the initial 5-year period. 

14 ‘‘(3) INCREASE IN MAXIMUM NUMBER OF HOS15 PITALS PARTICIPATING IN THE DEMONSTRATION

16 PROGRAM.—Notwithstanding subsection (a)(4), dur17 ing the 1-year extension period, not more than 30 

18 rural community hospitals may participate in the 

19 demonstration program under this section. 

20 ‘‘(4) NO AFFECT ON HOSPITALS IN DEM21 ONSTRATION PROGRAM ON DATE OF ENACTMENT.— 

22 In the case of a rural community hospital that is 

23 participating in the demonstration program under 

24 this section as of the last day of the initial 5-year 

25 period, the Secretary shall provide for the continued 


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1 participation of such rural community hospital in 

2 the demonstration program during the 1-year exten3 sion period unless the rural community hospital 

4 makes an election, in such form and manner as the 

5 Secretary may specify, to discontinue such participa6 tion.’’. 

7 (b) CONFORMING AMENDMENTS.—Subsection (a)(5) 

8 of section 410A of the Medicare Prescription Drug, Im9 provement, and Modernization Act of 2003 (Public Law 

10 108–173; 117 Stat. 2272) is amended by inserting ‘‘(in 

11 this section referred to as the ‘initial 5-year period’) and, 

12 as provided in subsection (g), for the 1-year extension pe13 riod’’ after ‘‘5-year period’’. 

14 (c) TECHNICAL AMENDMENTS.— 

15 (1) Subsection (b) of section 410A of the Medi16 care Prescription Drug, Improvement, and Mod17 ernization Act of 2003 (Public Law 108–173; 117 

18 Stat. 2272) is amended— 

19 (A) in paragraph (1)(B)(ii), by striking 

20 ‘‘2)’’ and inserting ‘‘2))’’; and 

21 (B) in paragraph (2), by inserting ‘‘cost’’ 

22 before ‘‘reporting period’’ the first place such 

23 term appears in each of subparagraphs (A) and 

24 (B). 


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1 (2) Subsection (f)(1) of section 410A of the 

2 Medicare Prescription Drug, Improvement, and 

3 Modernization Act of 2003 (Public Law 108–173; 

4 117 Stat. 2272) is amended— 

5 (A) in subparagraph (A)(ii), by striking 

6 ‘‘paragraph (2)’’ and inserting ‘‘subparagraph 

7 (B)’’; and 

8 (B) in subparagraph (B), by striking 

9 ‘‘paragraph (1)(B)’’ and inserting ‘‘subpara10 graph (A)(ii)’’. 

11 SEC. 3124. EXTENSION OF THE MEDICARE-DEPENDENT 

12 HOSPITAL (MDH) PROGRAM. 

13 (a) EXTENSION OF PAYMENT METHODOLOGY.—Sec14 tion 1886(d)(5)(G) of the Social Security Act (42 U.S.C. 

15 1395ww(d)(5)(G)) is amended— 

16 (1) in clause (i), by striking ‘‘October 1, 2011’’ 

17 and inserting ‘‘October 1, 2012’’; and 

18 (2) in clause (ii)(II), by striking ‘‘October 1, 

19 2011’’ and inserting ‘‘October 1, 2012’’. 

20 (b) CONFORMING AMENDMENTS.— 

21 (1) EXTENSION OF TARGET AMOUNT.—Section 

22 1886(b)(3)(D) of the Social Security Act (42 U.S.C. 

23 1395ww(b)(3)(D)) is amended— 


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1 (A) in the matter preceding clause (i), by 

2 striking ‘‘October 1, 2011’’ and inserting ‘‘Oc3 tober 1, 2012’’; and 

4 (B) in clause (iv), by striking ‘‘through fis5 cal year 2011’’ and inserting ‘‘through fiscal 

6 year 2012’’. 

7 (2) PERMITTING HOSPITALS TO DECLINE RE8 CLASSIFICATION.—Section 13501(e)(2) of the Omni9 bus Budget Reconciliation Act of 1993 (42 U.S.C. 

10 1395ww note) is amended by striking ‘‘through fis11 cal year 2011’’ and inserting ‘‘through fiscal year 

12 2012’’. 

13 SEC. 3125. TEMPORARY IMPROVEMENTS TO THE MEDICARE 

14 INPATIENT HOSPITAL PAYMENT ADJUST15 MENT FOR LOW-VOLUME HOSPITALS. 

16 Section 1886(d)(12) of the Social Security Act (42 

17 U.S.C. 1395ww(d)(12)) is amended— 

18 (1) in subparagraph (A), by inserting ‘‘or (D)’’ 

19 after ‘‘subparagraph (B)’’; 

20 (2) in subparagraph (B), in the matter pre21 ceding clause (i), by striking ‘‘The Secretary’’ and 

22 inserting ‘‘For discharges occurring in fiscal years 

23 2005 through 2010 and for discharges occurring in 

24 fiscal year 2013 and subsequent fiscal years, the 

25 Secretary’’; 


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1 (3) in subparagraph (C)(i)— 

2 (A) by inserting ‘‘(or, with respect to fiscal 

3 years 2011 and 2012, 15 road miles)’’ after 

4 ‘‘25 road miles’’; and 

5 (B) by inserting ‘‘(or, with respect to fiscal 

6 years 2011 and 2012, 1,500 discharges of indi7 viduals entitled to, or enrolled for, benefits 

8 under part A)’’ after ‘‘800 discharges’’; and 

9 (4) by adding at the end the following new sub10 paragraph: 

11 ‘‘(D) TEMPORARY APPLICABLE PERCENT12 AGE INCREASE.—For discharges occurring in 

13 fiscal years 2011 and 2012, the Secretary shall 

14 determine an applicable percentage increase for 

15 purposes of subparagraph (A) using a contin16 uous linear sliding scale ranging from 25 per17 cent for low-volume hospitals with 200 or fewer 

18 discharges of individuals entitled to, or enrolled 

19 for, benefits under part A in the fiscal year to 

20 0 percent for low-volume hospitals with greater 

21 than 1,500 discharges of such individuals in the 

22 fiscal year.’’. 


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1 SEC. 3126. IMPROVEMENTS TO THE DEMONSTRATION 

2 PROJECT ON COMMUNITY HEALTH INTEGRA3 TION MODELS IN CERTAIN RURAL COUNTIES. 

4 (a) REMOVAL OF LIMITATION ON NUMBER OF ELIGI5 BLE COUNTIES SELECTED.—Subsection (d)(3) of section 

6 123 of the Medicare Improvements for Patients and Pro7 viders Act of 2008 (42 U.S.C. 1395i–4 note) is amended 

8 by striking ‘‘not more than 6’’. 

9 (b) REMOVAL OF REFERENCES TO RURAL HEALTH

10 CLINIC SERVICES AND INCLUSION OF PHYSICIANS’ SERV11 ICES IN SCOPE OF DEMONSTRATION PROJECT.—Such 

12 section 123 is amended— 

13 (1) in subsection (d)(4)(B)(i)(3), by striking 

14 subclause (III); and 

15 (2) in subsection (j)— 

16 (A) in paragraph (8), by striking subpara17 graph (B) and inserting the following: 

18 ‘‘(B) Physicians’ services (as defined in 

19 section 1861(q) of the Social Security Act (42 

20 U.S.C. 1395x(q)).’’; 

21 (B) by striking paragraph (9); and 

22 (C) by redesignating paragraph (10) as 

23 paragraph (9). 


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1 SEC. 3127. MEDPAC STUDY ON ADEQUACY OF MEDICARE 

2 PAYMENTS FOR HEALTH CARE PROVIDERS 

3 SERVING IN RURAL AREAS. 

4 (a) STUDY.—The Medicare Payment Advisory Com5 mission shall conduct a study on the adequacy of pay6 ments for items and services furnished by providers of 

7 services and suppliers in rural areas under the Medicare 

8 program under title XVIII of the Social Security Act (42 

9 U.S.C. 1395 et seq.). Such study shall include an analysis 

10 of— 

11 (1) any adjustments in payments to providers 

12 of services and suppliers that furnish items and 

13 services in rural areas; 

14 (2) access by Medicare beneficiaries to items 

15 and services in rural areas; 

16 (3) the adequacy of payments to providers of 

17 services and suppliers that furnish items and serv18 ices in rural areas; and 

19 (4) the quality of care furnished in rural areas. 

20 (b) REPORT.—Not later than January 1, 2011, the 

21 Medicare Payment Advisory Commission shall submit to 

22 Congress a report containing the results of the study con23 ducted under subsection (a). Such report shall include rec24 ommendations on appropriate modifications to any adjust25 ments in payments to providers of services and suppliers 

26 that furnish items and services in rural areas, together 


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1 with recommendations for such legislation and administra2 tive action as the Medicare Payment Advisory Commission 

3 determines appropriate. 

4 SEC. 3128. TECHNICAL CORRECTION RELATED TO CRIT5 ICAL ACCESS HOSPITAL SERVICES. 

6 (a) IN GENERAL.—Subsections (g)(2)(A) and (l)(8) 

7 of section 1834 of the Social Security Act (42 U.S.C. 

8 1395m) are each amended by inserting ‘‘101 percent of’’ 

9 before ‘‘the reasonable costs’’. 

10 (b) EFFECTIVE DATE.—The amendments made by 

11 subsection (a) shall take effect as if included in the enact12 ment of section 405(a) of the Medicare Prescription Drug, 

13 Improvement, and Modernization Act of 2003 (Public Law 

14 108–173; 117 Stat. 2266). 

15 SEC. 3129. EXTENSION OF AND REVISIONS TO MEDICARE 

16 RURAL HOSPITAL FLEXIBILITY PROGRAM. 

17 (a) AUTHORIZATION.—Section 1820(j) of the Social 

18 Security Act (42 U.S.C. 1395i–4(j)) is amended— 

19 (1) by striking ‘‘2010, and for’’ and inserting 

20 ‘‘2010, for’’; and 

21 (2) by inserting ‘‘and for making grants to all 

22 States under subsection (g), such sums as may be 

23 necessary in each of fiscal years 2011 and 2012, to 

24 remain available until expended’’ before the period 

25 at the end. 


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1 (b) USE OF FUNDS.—Section 1820(g)(3) of the So2 cial Security Act (42 U.S.C. 1395i–4(g)(3)) is amended— 

3 (1) in subparagraph (A), by inserting ‘‘and to 

4 assist such hospitals in participating in delivery sys5 tem reforms under the provisions of and amend6 ments made by the Patient Protection and Afford7 able Care Act, such as value-based purchasing pro8 grams, accountable care organizations under section 

9 1899, the National pilot program on payment bun10 dling under section 1866D, and other delivery sys11 tem reform programs determined appropriate by the 

12 Secretary’’ before the period at the end; and 

13 (2) in subparagraph (E)— 

14 (A) by striking ‘‘, and to offset’’ and in15 serting ‘‘, to offset’’; and 

16 (B) by inserting ‘‘and to participate in de17 livery system reforms under the provisions of 

18 and amendments made by the Patient Protec19 tion and Affordable Care Act, such as value20 based purchasing programs, accountable care 

21 organizations under section 1899, the National 

22 pilot program on payment bundling under sec23 tion 1866D, and other delivery system reform 

24 programs determined appropriate by the Sec25 retary’’ before the period at the end. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to grants made on or after January 

3 1, 2010. 

4 PART III—IMPROVING PAYMENT ACCURACY 

5 SEC. 3131. PAYMENT ADJUSTMENTS FOR HOME HEALTH 

6 CARE. 

7 (a) REBASING HOME HEALTH PROSPECTIVE PAY8 MENT AMOUNT.— 

9 (1) IN GENERAL.—Section 1895(b)(3)(A) of the 

10 Social Security Act (42 U.S.C. 1395fff(b)(3)(A)) is 

11 amended— 

12 (A) in clause (i)(III), by striking ‘‘For pe13 riods’’ and inserting ‘‘Subject to clause (iii), for 

14 periods’’; and 

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

16 clause: 

17 ‘‘(iii) ADJUSTMENT FOR 2013 AND

18 SUBSEQUENT YEARS.— 

19 ‘‘(I) IN GENERAL.—Subject to 

20 subclause (II), for 2013 and subse21 quent years, the amount (or amounts) 

22 that would otherwise be applicable 

23 under clause (i)(III) shall be adjusted 

24 by a percentage determined appro25 priate by the Secretary to reflect such 


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1 factors as changes in the number of 

2 visits in an episode, the mix of serv3 ices in an episode, the level of inten4 sity of services in an episode, the av5 erage cost of providing care per epi6 sode, and other factors that the Sec7 retary considers to be relevant. In 

8 conducting the analysis under the pre9 ceding sentence, the Secretary may 

10 consider differences between hospital11 based and freestanding agencies, be12 tween for-profit and nonprofit agen13 cies, and between the resource costs of 

14 urban and rural agencies. Such ad15 justment shall be made before the up16 date under subparagraph (B) is ap17 plied for the year. 

18 ‘‘(II) TRANSITION.—The Sec19 retary shall provide for a 4-year 

20 phase-in (in equal increments) of the 

21 adjustment under subclause (I), with 

22 such adjustment being fully imple23 mented for 2016. During each year of 

24 such phase-in, the amount of any ad25 justment under subclause (I) for the 


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1 year may not exceed 3.5 percent of 

2 the amount (or amounts) applicable 

3 under clause (i)(III) as of the date of 

4 enactment of the Patient Protection 

5 and Affordable Care Act.’’. 

6 (2) MEDPAC STUDY AND REPORT.— 

7 (A) STUDY.—The Medicare Payment Advi8 sory Commission shall conduct a study on the 

9 implementation of the amendments made by 

10 paragraph (1). Such study shall include an 

11 analysis of the impact of such amendments 

12 on— 

13 (i) access to care; 

14 (ii) quality outcomes; 

15 (iii) the number of home health agen16 cies; and 

17 (iv) rural agencies, urban agencies, 

18 for-profit agencies, and nonprofit agencies. 

19 (B) REPORT.—Not later than January 1, 

20 2015, the Medicare Payment Advisory Commis21 sion shall submit to Congress a report on the 

22 study conducted under subparagraph (A), to23 gether with recommendations for such legisla24 tion and administrative action as the Commis25 sion determines appropriate. 


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1 (b) PROGRAM-SPECIFIC OUTLIER CAP.—Section 

2 1895(b) of the Social Security Act (42 U.S.C. 1395fff(b)) 

3 is amended— 

4 (1) in paragraph (3)(C), by striking ‘‘the aggre5 gate’’ and all that follows through the period at the 

6 end and inserting ‘‘5 percent of the total payments 

7 estimated to be made based on the prospective pay8 ment system under this subsection for the period.’’; 

9 and 

10 (2) in paragraph (5)— 

11 (A) by striking ‘‘OUTLIERS.—The Sec12 retary’’ and inserting the following: 

13 ‘‘OUTLIERS.— 

14 ‘‘(A) IN GENERAL.—Subject to subpara15 graph (B), the Secretary’’; 

16 (B) in subparagraph (A), as added by sub17 paragraph (A), by striking ‘‘5 percent’’ and in18 serting ‘‘2.5 percent’’; and 

19 (C) by adding at the end the following new 

20 subparagraph: 

21 ‘‘(B) PROGRAM SPECIFIC OUTLIER CAP.— 

22 The estimated total amount of additional pay23 ments or payment adjustments made under 

24 subparagraph (A) with respect to a home health 

25 agency for a year (beginning with 2011) may 


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1 not exceed an amount equal to 10 percent of 

2 the estimated total amount of payments made 

3 under this section (without regard to this para4 graph) with respect to the home health agency 

5 for the year.’’. 

6 (c) APPLICATION OF THE MEDICARE RURAL HOME

7 HEALTH ADD-ON POLICY.—Section 421 of the Medicare 

8 Prescription Drug, Improvement, and Modernization Act 

9 of 2003 (Public Law 108–173; 117 Stat. 2283), as 

10 amended by section 5201(b) of the Deficit Reduction Act 

11 of 2005 (Public Law 109–171; 120 Stat. 46), is amend12 ed— 

13 (1) in the section heading, by striking ‘‘ONE14 YEAR’’ and inserting ‘‘TEMPORARY’’; and 

15 (2) in subsection (a)— 

16 (A) by striking ‘‘, and episodes’’ and in17 serting ‘‘, episodes’’; 

18 (B) by inserting ‘‘and episodes and visits 

19 ending on or after April 1, 2010, and before 

20 January 1, 2016,’’ after ‘‘January 1, 2007,’’; 

21 and 

22 (C) by inserting ‘‘(or, in the case of epi23 sodes and visits ending on or after April 1, 

24 2010, and before January 1, 2016, 3 percent)’’ 

25 before the period at the end. 


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1 (d) STUDY AND REPORT ON THE DEVELOPMENT OF

2 HOME HEALTH PAYMENT REFORMS IN ORDER TO EN3 SURE ACCESS TO CARE AND QUALITY SERVICES.— 

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

5 Human Services (in this section referred to as the 

6 ‘‘Secretary’’) shall conduct a study to evaluate the 

7 costs and quality of care among efficient home 

8 health agencies relative to other such agencies in 

9 providing ongoing access to care and in treating 

10 Medicare beneficiaries with varying severity levels of 

11 illness. Such study shall include an analysis of the 

12 following: 

13 (A) Methods to revise the home health pro14 spective payment system under section 1895 of 

15 the Social Security Act (42 U.S.C. 1395fff) to 

16 more accurately account for the costs related to 

17 patient severity of illness or to improving bene18 ficiary access to care, including— 

19 (i) payment adjustments for services 

20 that may be under- or over-valued; 

21 (ii) necessary changes to reflect the 

22 resource use relative to providing home 

23 health services to low-income Medicare 

24 beneficiaries or Medicare beneficiaries liv25 ing in medically underserved areas; 


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1 (iii) ways the outlier payment may be 

2 improved to more accurately reflect the 

3 cost of treating Medicare beneficiaries with 

4 high severity levels of illness; 

5 (iv) the role of quality of care incen6 tives and penalties in driving provider and 

7 patient behavior; 

8 (v) improvements in the application of 

9 a wage index; and 

10 (vi) other areas determined appro11 priate by the Secretary. 

12 (B) The validity and reliability of re13 sponses on the OASIS instrument with par14 ticular emphasis on questions that relate to 

15 higher payment under the home health prospec16 tive payment system and higher outcome scores 

17 under Home Care Compare. 

18 (C) Additional research or payment revi19 sions under the home health prospective pay20 ment system that may be necessary to set the 

21 payment rates for home health services based 

22 on costs of high-quality and efficient home 

23 health agencies or to improve Medicare bene24 ficiary access to care. 


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1 (D) A timetable for implementation of any 

2 appropriate changes based on the analysis of 

3 the matters described in subparagraphs (A), 

4 (B), and (C). 

5 (E) Other areas determined appropriate by 

6 the Secretary. 

7 (2) CONSIDERATIONS.—In conducting the study 

8 under paragraph (1), the Secretary shall consider 

9 whether certain factors should be used to measure 

10 patient severity of illness and access to care, such 

11 as— 

12 (A) population density and relative patient 

13 access to care; 

14 (B) variations in service costs for providing 

15 care to individuals who are dually eligible under 

16 the Medicare and Medicaid programs; 

17 (C) the presence of severe or chronic dis18 eases, as evidenced by multiple, discontinuous 

19 home health episodes; 

20 (D) poverty status, as evidenced by the re21 ceipt of Supplemental Security Income under 

22 title XVI of the Social Security Act; 

23 (E) the absence of caregivers; 

24 (F) language barriers; 

25 (G) atypical transportation costs; 


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1 (H) security costs; and 

2 (I) other factors determined appropriate by 

3 the Secretary. 

4 (3) REPORT.—Not later than March 1, 2011, 

5 the Secretary shall submit to Congress a report on 

6 the study conducted under paragraph (1), together 

7 with recommendations for such legislation and ad8 ministrative action as the Secretary determines ap9 propriate. 

10 (4) CONSULTATIONS.—In conducting the study 

11 under paragraph (1) and preparing the report under 

12 paragraph (3), the Secretary shall consult with— 

13 (A) stakeholders representing home health 

14 agencies; 

15 (B) groups representing Medicare bene16 ficiaries; 

17 (C) the Medicare Payment Advisory Com18 mission; 

19 (D) the Inspector General of the Depart20 ment of Health and Human Services; and 

21 (E) the Comptroller General of the United 

22 States. 

23 SEC. 3132. HOSPICE REFORM. 

24 (a) HOSPICE CARE PAYMENT REFORMS.— 


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1 (1) IN GENERAL.—Section 1814(i) of the Social 

2 Security Act (42 U.S.C. 1395f(i)), as amended by 

3 section 3004(c), is amended— 

4 (A) by redesignating paragraph (6) as 

5 paragraph (7); and 

6 (B) by inserting after paragraph (5) the 

7 following new paragraph: 

8 ‘‘(6)(A) The Secretary shall collect additional 

9 data and information as the Secretary determines 

10 appropriate to revise payments for hospice care 

11 under this subsection pursuant to subparagraph (D) 

12 and for other purposes as determined appropriate by 

13 the Secretary. The Secretary shall begin to collect 

14 such data by not later than January 1, 2011. 

15 ‘‘(B) The additional data and information to be 

16 collected under subparagraph (A) may include data 

17 and information on— 

18 ‘‘(i) charges and payments; 

19 ‘‘(ii) the number of days of hospice care 

20 which are attributable to individuals who are 

21 entitled to, or enrolled for, benefits under part 

22 A; and 

23 ‘‘(iii) with respect to each type of service 

24 included in hospice care— 


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1 ‘‘(I) the number of days of hospice 

2 care attributable to the type of service; 

3 ‘‘(II) the cost of the type of service; 

4 and 

5 ‘‘(III) the amount of payment for the 

6 type of service; 

7 ‘‘(iv) charitable contributions and other 

8 revenue of the hospice program; 

9 ‘‘(v) the number of hospice visits; 

10 ‘‘(vi) the type of practitioner providing the 

11 visit; and 

12 ‘‘(vii) the length of the visit and other 

13 basic information with respect to the visit. 

14 ‘‘(C) The Secretary may collect the additional 

15 data and information under subparagraph (A) on 

16 cost reports, claims, or other mechanisms as the 

17 Secretary determines to be appropriate. 

18 ‘‘(D)(i) Notwithstanding the preceding para19 graphs of this subsection, not earlier than October 

20 1, 2013, the Secretary shall, by regulation, imple21 ment revisions to the methodology for determining 

22 the payment rates for routine home care and other 

23 services included in hospice care under this part, as 

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1 formation collected under subparagraph (A). Such 

2 revisions may include adjustments to per diem pay3 ments that reflect changes in resource intensity in 

4 providing such care and services during the course 

5 of the entire episode of hospice care. 

6 ‘‘(ii) Revisions in payment implemented pursu7 ant to clause (i) shall result in the same estimated 

8 amount of aggregate expenditures under this title 

9 for hospice care furnished in the fiscal year in which 

10 such revisions in payment are implemented as would 

11 have been made under this title for such care in 

12 such fiscal year if such revisions had not been imple13 mented. 

14 ‘‘(E) The Secretary shall consult with hospice 

15 programs and the Medicare Payment Advisory Com16 mission regarding the additional data and informa17 tion to be collected under subparagraph (A) and the 

18 payment revisions under subparagraph (D).’’. 

19 (2) CONFORMING AMENDMENTS.—Section 

20 1814(i)(1)(C) of the Social Security Act (42 U.S.C. 

21 1395f(i)(1)(C)) is amended— 

22 (A) in clause (ii)— 

23 (i) in the matter preceding subclause 

24 (I), by inserting ‘‘(before the first fiscal 

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1 scribed in paragraph (6)(D) are imple2 mented)’’ after ‘‘subsequent fiscal year’’; 

3 and 

4 (ii) in subclause (VII), by inserting 

5 ‘‘(before the first fiscal year in which the 

6 payment revisions described in paragraph 

7 (6)(D) are implemented), subject to clause 

8 (iv),’’ after ‘‘subsequent fiscal year’’; and 

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

10 clause: 

11 ‘‘(iii) With respect to routine home 

12 care and other services included in hospice 

13 care furnished during fiscal years subse14 quent to the first fiscal year in which pay15 ment revisions described in paragraph 

16 (6)(D) are implemented, the payment rates 

17 for such care and services shall be the pay18 ment rates in effect under this clause dur19 ing the preceding fiscal year increased by, 

20 subject to clause (iv), the market basket 

21 percentage increase (as defined in section 

22 1886(b)(3)(B)(iii)) for the fiscal year.’’. 

23 (b) ADOPTION OF MEDPAC HOSPICE PROGRAM ELI24 GIBILITY RECERTIFICATION RECOMMENDATIONS.—SecVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00840 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tion 1814(a)(7) of the Social Security Act (42 U.S.C. 

2 1395f(a)(7)) is amended— 

3 (1) in subparagraph (B), by striking ‘‘and’’ at 

4 the end; and 

5 (2) by adding at the end the following new sub6 paragraph: 

7 ‘‘(D) on and after January 1, 2011— 

8 ‘‘(i) a hospice physician or nurse prac9 titioner has a face-to-face encounter with 

10 the individual to determine continued eligi11 bility of the individual for hospice care 

12 prior to the 180th-day recertification and 

13 each subsequent recertification under sub14 paragraph (A)(ii) and attests that such 

15 visit took place (in accordance with proce16 dures established by the Secretary); and 

17 ‘‘(ii) in the case of hospice care pro18 vided an individual for more than 180 days 

19 by a hospice program for which the num20 ber of such cases for such program com21 prises more than a percent (specified by 

22 the Secretary) of the total number of such 

23 cases for all programs under this title, the 

24 hospice care provided to such individual is 

25 medically reviewed (in accordance with 


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1 procedures established by the Secretary); 

2 and’’. 

3 SEC. 3133. IMPROVEMENT TO MEDICARE DISPROPOR4 TIONATE SHARE HOSPITAL (DSH) PAYMENTS. 

5 Section 1886 of the Social Security Act (42 U.S.C. 

6 1395ww), as amended by sections 3001, 3008, and 3025, 

7 is amended— 

8 (1) in subsection (d)(5)(F)(i), by striking 

9 ‘‘For’’ and inserting ‘‘Subject to subsection (r), for’’; 

10 and 

11 (2) by adding at the end the following new sub12 section: 

13 ‘‘(r) ADJUSTMENTS TO MEDICARE DSH PAY14 MENTS.— 

15 ‘‘(1) EMPIRICALLY JUSTIFIED DSH PAY16 MENTS.—For fiscal year 2015 and each subsequent 

17 fiscal year, instead of the amount of dispropor18 tionate share hospital payment that would otherwise 

19 be made under subsection (d)(5)(F) to a subsection 

20 (d) hospital for the fiscal year, the Secretary shall 

21 pay to the subsection (d) hospital 25 percent of such 

22 amount (which represents the empirically justified 

23 amount for such payment, as determined by the 

24 Medicare Payment Advisory Commission in its 

25 March 2007 Report to the Congress). 


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1 ‘‘(2) ADDITIONAL PAYMENT.—In addition to 

2 the payment made to a subsection (d) hospital under 

3 paragraph (1), for fiscal year 2015 and each subse4 quent fiscal year, the Secretary shall pay to such 

5 subsection (d) hospitals an additional amount equal 

6 to the product of the following factors: 

7 ‘‘(A) FACTOR ONE.—A factor equal to the 

8 difference between— 

9 ‘‘(i) the aggregate amount of pay10 ments that would be made to subsection 

11 (d) hospitals under subsection (d)(5)(F) if 

12 this subsection did not apply for such fis13 cal year (as estimated by the Secretary); 

14 and 

15 ‘‘(ii) the aggregate amount of pay16 ments that are made to subsection (d) hos17 pitals under paragraph (1) for such fiscal 

18 year (as so estimated). 

19 ‘‘(B) FACTOR TWO.— 

20 ‘‘(i) FISCAL YEARS 2015, 2016, AND

21 2017.—For each of fiscal years 2015, 2016, 

22 and 2017, a factor equal to 1 minus the 

23 percent change (divided by 100) in the per24 cent of individuals under the age of 65 who 


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1 are uninsured, as determined by comparing 

2 the percent of such individuals— 

3 ‘‘(I) who are uninsured in 2012, 

4 the last year before coverage expan5 sion under the Patient Protection and 

6 Affordable Care Act (as calculated by 

7 the Secretary based on the most re8 cent estimates available from the Di9 rector of the Congressional Budget 

10 Office before a vote in either House 

11 on such Act that, if determined in the 

12 affirmative, would clear such Act for 

13 enrollment); and 

14 ‘‘(II) who are uninsured in the 

15 most recent period for which data is 

16 available (as so calculated). 

17 ‘‘(ii) 2018 AND SUBSEQUENT

18 YEARS.—For fiscal year 2018 and each 

19 subsequent fiscal year, a factor equal to 1 

20 minus the percent change (divided by 100) 

21 in the percent of individuals who are unin22 sured, as determined by comparing the 

23 percent of individuals— 

24 ‘‘(I) who are uninsured in 2012 

25 (as estimated by the Secretary, based 


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1 on data from the Census Bureau or 

2 other sources the Secretary deter3 mines appropriate, and certified by 

4 the Chief Actuary of the Centers for 

5 Medicare & Medicaid Services); and 

6 ‘‘(II) who are uninsured in the 

7 most recent period for which data is 

8 available (as so estimated and cer9 tified). 

10 ‘‘(C) FACTOR THREE.—A factor equal to 

11 the percent, for each subsection (d) hospital, 

12 that represents the quotient of— 

13 ‘‘(i) the amount of uncompensated 

14 care for such hospital for a period selected 

15 by the Secretary (as estimated by the Sec16 retary, based on appropriate data (includ17 ing, in the case where the Secretary deter18 mines that alternative data is available 

19 which is a better proxy for the costs of 

20 subsection (d) hospitals for treating the 

21 uninsured, the use of such alternative 

22 data)); and 

23 ‘‘(ii) the aggregate amount of uncom24 pensated care for all subsection (d) hos25 pitals that receive a payment under this 


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1 subsection for such period (as so esti2 mated, based on such data). 

3 ‘‘(3) LIMITATIONS ON REVIEW.—There shall be 

4 no administrative or judicial review under section 

5 1869, section 1878, or otherwise of the following: 

6 ‘‘(A) Any estimate of the Secretary for 

7 purposes of determining the factors described in 

8 paragraph (2). 

9 ‘‘(B) Any period selected by the Secretary 

10 for such purposes.’’. 

11 SEC. 3134. MISVALUED CODES UNDER THE PHYSICIAN FEE 

12 SCHEDULE. 

13 (a) IN GENERAL.—Section 1848(c)(2) of the Social 

14 Security Act (42 U.S.C. 1395w–4(c)(2)) is amended by 

15 adding at the end the following new subparagraphs: 

16 ‘‘(K) POTENTIALLY MISVALUED CODES.— 

17 ‘‘(i) IN GENERAL.—The Secretary 

18 shall— 

19 ‘‘(I) periodically identify services 

20 as being potentially misvalued using 

21 criteria specified in clause (ii); and 

22 ‘‘(II) review and make appro23 priate adjustments to the relative val24 ues established under this paragraph 


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1 for services identified as being poten2 tially misvalued under subclause (I). 

3 ‘‘(ii) IDENTIFICATION OF POTEN4 TIALLY MISVALUED CODES.—For purposes 

5 of identifying potentially misvalued services 

6 pursuant to clause (i)(I), the Secretary 

7 shall examine (as the Secretary determines 

8 to be appropriate) codes (and families of 

9 codes as appropriate) for which there has 

10 been the fastest growth; codes (and fami11 lies of codes as appropriate) that have ex12 perienced substantial changes in practice 

13 expenses; codes for new technologies or 

14 services within an appropriate period (such 

15 as 3 years) after the relative values are ini16 tially established for such codes; multiple 

17 codes that are frequently billed in conjunc18 tion with furnishing a single service; codes 

19 with low relative values, particularly those 

20 that are often billed multiple times for a 

21 single treatment; codes which have not 

22 been subject to review since the implemen23 tation of the RBRVS (the so-called ‘Har24 vard-valued codes’); and such other codes 


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1 determined to be appropriate by the Sec2 retary. 

3 ‘‘(iii) REVIEW AND ADJUSTMENTS.— 

4 ‘‘(I) The Secretary may use ex5 isting processes to receive rec6 ommendations on the review and ap7 propriate adjustment of potentially 

8 misvalued services described in clause 

9 (i)(II). 

10 ‘‘(II) The Secretary may conduct 

11 surveys, other data collection activi12 ties, studies, or other analyses as the 

13 Secretary determines to be appro14 priate to facilitate the review and ap15 propriate adjustment described in 

16 clause (i)(II). 

17 ‘‘(III) The Secretary may use 

18 analytic contractors to identify and 

19 analyze services identified under 

20 clause (i)(I), conduct surveys or col21 lect data, and make recommendations 

22 on the review and appropriate adjust23 ment of services described in clause 

24 (i)(II). 


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1 ‘‘(IV) The Secretary may coordi2 nate the review and appropriate ad3 justment described in clause (i)(II) 

4 with the periodic review described in 

5 subparagraph (B). 

6 ‘‘(V) As part of the review and 

7 adjustment described in clause (i)(II), 

8 including with respect to codes with 

9 low relative values described in clause 

10 (ii), the Secretary may make appro11 priate coding revisions (including 

12 using existing processes for consider13 ation of coding changes) which may 

14 include consolidation of individual 

15 services into bundled codes for pay16 ment under the fee schedule under 

17 subsection (b). 

18 ‘‘(VI) The provisions of subpara19 graph (B)(ii)(II) shall apply to adjust20 ments to relative value units made 

21 pursuant to this subparagraph in the 

22 same manner as such provisions apply 

23 to adjustments under subparagraph 

24 (B)(ii)(II). 


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1 ‘‘(L) VALIDATING RELATIVE VALUE

2 UNITS.— 

3 ‘‘(i) IN GENERAL.—The Secretary 

4 shall establish a process to validate relative 

5 value units under the fee schedule under 

6 subsection (b). 

7 ‘‘(ii) COMPONENTS AND ELEMENTS

8 OF WORK.—The process described in 

9 clause (i) may include validation of work 

10 elements (such as time, mental effort and 

11 professional judgment, technical skill and 

12 physical effort, and stress due to risk) in13 volved with furnishing a service and may 

14 include validation of the pre-, post-, and 

15 intra-service components of work. 

16 ‘‘(iii) SCOPE OF CODES.—The valida17 tion of work relative value units shall in18 clude a sampling of codes for services that 

19 is the same as the codes listed under sub20 paragraph (K)(ii). 

21 ‘‘(iv) METHODS.—The Secretary may 

22 conduct the validation under this subpara23 graph using methods described in sub24 clauses (I) through (V) of subparagraph 


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1 (K)(iii) as the Secretary determines to be 

2 appropriate. 

3 ‘‘(v) ADJUSTMENTS.—The Secretary 

4 shall make appropriate adjustments to the 

5 work relative value units under the fee 

6 schedule under subsection (b). The provi7 sions of subparagraph (B)(ii)(II) shall 

8 apply to adjustments to relative value units 

9 made pursuant to this subparagraph in the 

10 same manner as such provisions apply to 

11 adjustments under subparagraph 

12 (B)(ii)(II).’’. 

13 (b) IMPLEMENTATION.— 

14 (1) ADMINISTRATION.— 

15 (A) Chapter 35 of title 44, United States 

16 Code and the provisions of the Federal Advisory 

17 Committee Act (5 U.S.C. App.) shall not apply 

18 to this section or the amendment made by this 

19 section. 

20 (B) Notwithstanding any other provision of 

21 law, the Secretary may implement subpara22 graphs (K) and (L) of 1848(c)(2) of the Social 

23 Security Act, as added by subsection (a), by 

24 program instruction or otherwise. 


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1 (C) Section 4505(d) of the Balanced 

2 Budget Act of 1997 is repealed. 

3 (D) Except for provisions related to con4 fidentiality of information, the provisions of the 

5 Federal Acquisition Regulation shall not apply 

6 to this section or the amendment made by this 

7 section. 

8 (2) FOCUSING CMS RESOURCES ON POTEN9 TIALLY OVERVALUED CODES.—Section 1868(a) of 

10 the Social Security Act (42 U.S.C. 1395ee(a)) is re11 pealed. 

12 SEC. 3135. MODIFICATION OF EQUIPMENT UTILIZATION 

13 FACTOR FOR ADVANCED IMAGING SERVICES. 

14 (a) ADJUSTMENT IN PRACTICE EXPENSE TO RE15 FLECT HIGHER PRESUMED UTILIZATION.—Section 1848 

16 of the Social Security Act (42 U.S.C. 1395w–4) is amend17 ed— 

18 (1) in subsection (b)(4)— 

19 (A) in subparagraph (B), by striking ‘‘sub20 paragraph (A)’’ and inserting ‘‘this paragraph’’; 

21 and 

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

23 subparagraph: 

24 ‘‘(C) ADJUSTMENT IN PRACTICE EXPENSE

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1 TION.—Consistent with the methodology for 

2 computing the number of practice expense rel3 ative value units under subsection (c)(2)(C)(ii) 

4 with respect to advanced diagnostic imaging 

5 services (as defined in section 1834(e)(1)(B)) 

6 furnished on or after January 1, 2010, the Sec7 retary shall adjust such number of units so it 

8 reflects— 

9 ‘‘(i) in the case of services furnished 

10 on or after January 1, 2010, and before 

11 January 1, 2013, a 65 percent (rather 

12 than 50 percent) presumed rate of utiliza13 tion of imaging equipment; 

14 ‘‘(ii) in the case of services furnished 

15 on or after January 1, 2013, and before 

16 January 1, 2014, a 70 percent (rather 

17 than 50 percent) presumed rate of utiliza18 tion of imaging equipment; and 

19 ‘‘(iii) in the case of services furnished 

20 on or after January 1, 2014, a 75 percent 

21 (rather than 50 percent) presumed rate of 

22 utilization of imaging equipment.’’; and 

23 (2) in subsection (c)(2)(B)(v), by adding at the 

24 end the following new subclauses: 


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1 ‘‘(III) CHANGE IN PRESUMED

2 UTILIZATION LEVEL OF CERTAIN AD3 VANCED DIAGNOSTIC IMAGING SERV4 ICES FOR 2010 THROUGH 2012.—Effec5 tive for fee schedules established be6 ginning with 2010 and ending with 

7 2012, reduced expenditures attrib8 utable to the presumed rate of utiliza9 tion of imaging equipment of 65 per10 cent under subsection (b)(4)(C)(i) in11 stead of a presumed rate of utilization 

12 of such equipment of 50 percent. 

13 ‘‘(IV) CHANGE IN PRESUMED

14 UTILIZATION LEVEL OF CERTAIN AD15 VANCED DIAGNOSTIC IMAGING SERV16 ICES FOR 2013.—Effective for fee 

17 schedules established for 2013, re18 duced expenditures attributable to the 

19 presumed rate of utilization of imag20 ing equipment of 70 percent under 

21 subsection (b)(4)(C)(ii) instead of a 

22 presumed rate of utilization of such 

23 equipment of 50 percent. 

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1 VANCED DIAGNOSTIC IMAGING SERV2 ICES FOR 2014 AND SUBSEQUENT

3 YEARS.—Effective for fee schedules 

4 established beginning with 2014, re5 duced expenditures attributable to the 

6 presumed rate of utilization of imag7 ing equipment of 75 percent under 

8 subsection (b)(4)(C)(iii) instead of a 

9 presumed rate of utilization of such 

10 equipment of 50 percent.’’. 

11 (b) ADJUSTMENT IN TECHNICAL COMPONENT ‘‘DIS12 COUNT’’ ON SINGLE-SESSION IMAGING TO CONSECUTIVE

13 BODY PARTS.—Section 1848 of the Social Security Act 

14 (42 U.S.C. 1395w–4), as amended by subsection (a), is 

15 amended— 

16 (1) in subsection (b)(4), by adding at the end 

17 the following new subparagraph: 

18 ‘‘(D) ADJUSTMENT IN TECHNICAL COMPO19 NENT DISCOUNT ON SINGLE-SESSION IMAGING

20 INVOLVING CONSECUTIVE BODY PARTS.—For 

21 services furnished on or after July 1, 2010, the 

22 Secretary shall increase the reduction in pay23 ments attributable to the multiple procedure 

24 payment reduction applicable to the technical 

25 component for imaging under the final rule 


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1 published by the Secretary in the Federal Reg2 ister on November 21, 2005 (part 405 of title 

3 42, Code of Federal Regulations) from 25 per4 cent to 50 percent.’’; and 

5 (2) in subsection (c)(2)(B)(v), by adding at the 

6 end the following new subclause: 

7 ‘‘(VI) ADDITIONAL REDUCED

8 PAYMENT FOR MULTIPLE IMAGING

9 PROCEDURES.—Effective for fee 

10 schedules established beginning with 

11 2010 (but not applied for services fur12 nished prior to July 1, 2010), reduced 

13 expenditures attributable to the in14 crease in the multiple procedure pay15 ment reduction from 25 to 50 percent 

16 (as described in subsection 

17 (b)(4)(D)).’’. 

18 (c) ANALYSIS BY THE CHIEF ACTUARY OF THE CEN19 TERS FOR MEDICARE & MEDICAID SERVICES.—Not later 

20 than January 1, 2013, the Chief Actuary of the Centers 

21 for Medicare & Medicaid Services shall make publicly 

22 available an analysis of whether, for the period of 2010 

23 through 2019, the cumulative expenditure reductions 

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1 tributable to the adjustments under the amendments made 

2 by this section are projected to exceed $3,000,000,000. 

3 SEC. 3136. REVISION OF PAYMENT FOR POWER-DRIVEN 

4 WHEELCHAIRS. 

5 (a) IN GENERAL.—Section 1834(a)(7)(A) of the So6 cial Security Act (42 U.S.C. 1395m(a)(7)(A)) is amend7 ed— 

8 (1) in clause (i)— 

9 (A) in subclause (II), by inserting ‘‘sub10 clause (III) and’’ after ‘‘Subject to’’; and 

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

12 subclause: 

13 ‘‘(III) SPECIAL RULE FOR

14 POWER-DRIVEN WHEELCHAIRS.—For 

15 purposes of payment for power-driven 

16 wheelchairs, subclause (II) shall be 

17 applied by substituting ‘15 percent’ 

18 and ‘6 percent’ for ‘10 percent’ and 

19 ‘7.5 percent’, respectively.’’; and 

20 (2) in clause (iii)— 

21 (A) in the heading, by inserting ‘‘COM22 PLEX, REHABILITATIVE’’ before ‘‘POWER-DRIV23 EN’’; and 

24 (B) by inserting ‘‘complex, rehabilitative’’ 

25 before ‘‘power-driven’’. 


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1 (b) TECHNICAL AMENDMENT.—Section 

2 1834(a)(7)(C)(ii)(II) of the Social Security Act (42 U.S.C. 

3 1395m(a)(7)(C)(ii)(II)) is amended by striking ‘‘(A)(ii) 

4 or’’. 

5 (c) EFFECTIVE DATE.— 

6 (1) IN GENERAL.—Subject to paragraph (2), 

7 the amendments made by subsection (a) shall take 

8 effect on January 1, 2011, and shall apply to power9 driven wheelchairs furnished on or after such date. 

10 (2) APPLICATION TO COMPETITIVE BIDDING.— 

11 The amendments made by subsection (a) shall not 

12 apply to payment made for items and services fur13 nished pursuant to contracts entered into under sec14 tion 1847 of the Social Security Act (42 U.S.C. 

15 1395w–3) prior to January 1, 2011, pursuant to the 

16 implementation of subsection (a)(1)(B)(i)(I) of such 

17 section 1847. 

18 SEC. 3137. HOSPITAL WAGE INDEX IMPROVEMENT. 

19 (a) EXTENSION OF SECTION 508 HOSPITAL RECLAS20 SIFICATIONS.— 

21 (1) IN GENERAL.—Subsection (a) of section 

22 106 of division B of the Tax Relief and Health Care 

23 Act of 2006 (42 U.S.C. 1395 note), as amended by 

24 section 117 of the Medicare, Medicaid, and SCHIP 

25 Extension Act of 2007 (Public Law 110–173) and 


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1 section 124 of the Medicare Improvements for Pa2 tients and Providers Act of 2008 (Public Law 110– 

3 275), is amended by striking ‘‘September 30, 2009’’ 

4 and inserting ‘‘September 30, 2010’’. 

5 (2) USE OF PARTICULAR WAGE INDEX IN FIS6 CAL YEAR 2010.—For purposes of implementation of 

7 the amendment made by this subsection during fis8 cal year 2010, the Secretary shall use the hospital 

9 wage index that was promulgated by the Secretary 

10 in the Federal Register on August 27, 2009 (74 

11 Fed. Reg. 43754), and any subsequent corrections. 

12 (b) PLAN FOR REFORMING THE MEDICARE HOS13 PITAL WAGE INDEX SYSTEM.— 

14 (1) IN GENERAL.—Not later than December 31, 

15 2011, the Secretary of Health and Human Services 

16 (in this section referred to as the ‘‘Secretary’’) shall 

17 submit to Congress a report that includes a plan to 

18 reform the hospital wage index system under section 

19 1886 of the Social Security Act. 

20 (2) DETAILS.—In developing the plan under 

21 paragraph (1), the Secretary shall take into account 

22 the goals for reforming such system set forth in the 

23 Medicare Payment Advisory Commission June 2007 

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1 lishing a new hospital compensation index system 

2 that— 

3 (A) uses Bureau of Labor Statistics data, 

4 or other data or methodologies, to calculate rel5 ative wages for each geographic area involved; 

6 (B) minimizes wage index adjustments be7 tween and within metropolitan statistical areas 

8 and statewide rural areas; 

9 (C) includes methods to minimize the vola10 tility of wage index adjustments that result 

11 from implementation of policy, while maintain12 ing budget neutrality in applying such adjust13 ments; 

14 (D) takes into account the effect that im15 plementation of the system would have on 

16 health care providers and on each region of the 

17 country; 

18 (E) addresses issues related to occupa19 tional mix, such as staffing practices and ratios, 

20 and any evidence on the effect on quality of 

21 care or patient safety as a result of the imple22 mentation of the system; and 

23 (F) provides for a transition. 


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1 (3) CONSULTATION.—In developing the plan 

2 under paragraph (1), the Secretary shall consult 

3 with relevant affected parties. 

4 (c) USE OF PARTICULAR CRITERIA FOR DETER5 MINING RECLASSIFICATIONS.—Notwithstanding any other 

6 provision of law, in making decisions on applications for 

7 reclassification of a subsection (d) hospital (as defined in 

8 paragraph (1)(B) of section 1886(d) of the Social Security 

9 Act (42 U.S.C. 1395ww(d)) for the purposes described in 

10 paragraph (10)(D)(v) of such section for fiscal year 2011 

11 and each subsequent fiscal year (until the first fiscal year 

12 beginning on or after the date that is 1 year after the 

13 Secretary of Health and Human Services submits the re14 port to Congress under subsection (b)), the Geographic 

15 Classification Review Board established under paragraph 

16 (10) of such section shall use the average hourly wage 

17 comparison criteria used in making such decisions as of 

18 September 30, 2008. The preceding sentence shall be ef19 fected in a budget neutral manner. 

20 SEC. 3138. TREATMENT OF CERTAIN CANCER HOSPITALS. 

21 Section 1833(t) of the Social Security Act (42 U.S.C. 

22 1395l(t)) is amended by adding at the end the following 

23 new paragraph: 

24 ‘‘(18) AUTHORIZATION OF ADJUSTMENT FOR

25 CANCER HOSPITALS.— 


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1 ‘‘(A) STUDY.—The Secretary shall conduct 

2 a study to determine if, under the system under 

3 this subsection, costs incurred by hospitals de4 scribed in section 1886(d)(1)(B)(v) with respect 

5 to ambulatory payment classification groups ex6 ceed those costs incurred by other hospitals fur7 nishing services under this subsection (as deter8 mined appropriate by the Secretary). In con9 ducting the study under this subparagraph, the 

10 Secretary shall take into consideration the cost 

11 of drugs and biologicals incurred by such hos12 pitals. 

13 ‘‘(B) AUTHORIZATION OF ADJUSTMENT.— 

14 Insofar as the Secretary determines under sub15 paragraph (A) that costs incurred by hospitals 

16 described in section 1886(d)(1)(B)(v) exceed 

17 those costs incurred by other hospitals fur18 nishing services under this subsection, the Sec19 retary shall provide for an appropriate adjust20 ment under paragraph (2)(E) to reflect those 

21 higher costs effective for services furnished on 

22 or after January 1, 2011.’’. 


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1 SEC. 3139. PAYMENT FOR BIOSIMILAR BIOLOGICAL PROD2 UCTS. 

3 (a) IN GENERAL.—Section 1847A of the Social Secu4 rity Act (42 U.S.C. 1395w–3a) is amended— 

5 (1) in subsection (b)— 

6 (A) in paragraph (1)— 

7 (i) in subparagraph (A), by striking 

8 ‘‘or’’ at the end; 

9 (ii) in subparagraph (B), by striking 

10 the period at the end and inserting ‘‘; or’’; 

11 and 

12 (iii) by adding at the end the fol13 lowing new subparagraph: 

14 ‘‘(C) in the case of a biosimilar biological 

15 product (as defined in subsection (c)(6)(H)), 

16 the amount determined under paragraph (8).’’; 

17 and 

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

19 paragraph: 

20 ‘‘(8) BIOSIMILAR BIOLOGICAL PRODUCT.—The 

21 amount specified in this paragraph for a biosimilar 

22 biological product described in paragraph (1)(C) is 

23 the sum of— 

24 ‘‘(A) the average sales price as determined 

25 using the methodology described under para26 graph (6) applied to a biosimilar biological 


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1 product for all National Drug Codes assigned to 

2 such product in the same manner as such para3 graph is applied to drugs described in such 

4 paragraph; and 

5 ‘‘(B) 6 percent of the amount determined 

6 under paragraph (4) for the reference biological 

7 product (as defined in subsection (c)(6)(I)).’’; 

8 and 

9 (2) in subsection (c)(6), by adding at the end 

10 the following new subparagraph: 

11 ‘‘(H) BIOSIMILAR BIOLOGICAL PRODUCT.— 

12 The term ‘biosimilar biological product’ means 

13 a biological product approved under an abbre14 viated application for a license of a biological 

15 product that relies in part on data or informa16 tion in an application for another biological 

17 product licensed under section 351 of the Pub18 lic Health Service Act. 

19 ‘‘(I) REFERENCE BIOLOGICAL PRODUCT.— 

20 The term ‘reference biological product’ means 

21 the biological product licensed under such sec22 tion 351 that is referred to in the application 

23 described in subparagraph (H) of the biosimilar 

24 biological product.’’. 


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1 (b) EFFECTIVE DATE.—The amendments made by 

2 subsection (a) shall apply to payments for biosimilar bio3 logical products beginning with the first day of the second 

4 calendar quarter after enactment of legislation providing 

5 for a biosimilar pathway (as determined by the Secretary). 

6 SEC. 3140. MEDICARE HOSPICE CONCURRENT CARE DEM7 ONSTRATION PROGRAM. 

8 (a) ESTABLISHMENT.— 

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

10 Human Services (in this section referred to as the 

11 ‘‘Secretary’’) shall establish a Medicare Hospice 

12 Concurrent Care demonstration program at partici13 pating hospice programs under which Medicare 

14 beneficiaries are furnished, during the same period, 

15 hospice care and any other items or services covered 

16 under title XVIII of the Social Security Act (42 

17 U.S.C. 1395 et seq.) from funds otherwise paid 

18 under such title to such hospice programs. 

19 (2) DURATION.—The demonstration program 

20 under this section shall be conducted for a 3-year 

21 period. 

22 (3) SITES.—The Secretary shall select not more 

23 than 15 hospice programs at which the demonstra24 tion program under this section shall be conducted. 


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1 Such hospice programs shall be located in urban and 

2 rural areas. 

3 (b) INDEPENDENT EVALUATION AND REPORTS.— 

4 (1) INDEPENDENT EVALUATION.—The Sec5 retary shall provide for the conduct of an inde6 pendent evaluation of the demonstration program 

7 under this section. Such independent evaluation 

8 shall determine whether the demonstration program 

9 has improved patient care, quality of life, and cost10 effectiveness for Medicare beneficiaries participating 

11 in the demonstration program. 

12 (2) REPORTS.—The Secretary shall submit to 

13 Congress a report containing the results of the eval14 uation conducted under paragraph (1), together with 

15 such recommendations as the Secretary determines 

16 appropriate. 

17 (c) BUDGET NEUTRALITY.—With respect to the 3- 

18 year period of the demonstration program under this sec19 tion, the Secretary shall ensure that the aggregate expend20 itures under title XVIII for such period shall not exceed 

21 the aggregate expenditures that would have been expended 

22 under such title if the demonstration program under this 

23 section had not been implemented. 


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1 SEC. 3141. APPLICATION OF BUDGET NEUTRALITY ON A NA2 TIONAL BASIS IN THE CALCULATION OF THE 

3 MEDICARE HOSPITAL WAGE INDEX FLOOR. 

4 In the case of discharges occurring on or after Octo5 ber 1, 2010, for purposes of applying section 4410 of the 

6 Balanced Budget Act of 1997 (42 U.S.C. 1395ww note) 

7 and paragraph (h)(4) of section 412.64 of title 42, Code 

8 of Federal Regulations, the Secretary of Health and 

9 Human Services shall administer subsection (b) of such 

10 section 4410 and paragraph (e) of such section 412.64 

11 in the same manner as the Secretary administered such 

12 subsection (b) and paragraph (e) for discharges occurring 

13 during fiscal year 2008 (through a uniform, national ad14 justment to the area wage index). 

15 SEC. 3142. HHS STUDY ON URBAN MEDICARE-DEPENDENT 

16 HOSPITALS. 

17 (a) STUDY.— 

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

19 Human Services (in this section referred to as the 

20 ‘‘Secretary’’) shall conduct a study on the need for 

21 an additional payment for urban Medicare-depend22 ent hospitals for inpatient hospital services under 

23 section 1886 of the Social Security Act (42 U.S.C. 

24 1395ww). Such study shall include an analysis of— 

25 (A) the Medicare inpatient margins of 

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1 pared to other hospitals which receive 1 or more 

2 additional payments or adjustments under such 

3 section (including those payments or adjust4 ments described in paragraph (2)(A)); and 

5 (B) whether payments to medicare-depend6 ent, small rural hospitals under subsection 

7 (d)(5)(G) of such section should be applied to 

8 urban Medicare-dependent hospitals. 

9 (2) URBAN MEDICARE-DEPENDENT HOSPITAL

10 DEFINED.—For purposes of this section, the term 

11 ‘‘urban Medicare-dependent hospital’’ means a sub12 section (d) hospital (as defined in subsection 

13 (d)(1)(B) of such section) that— 

14 (A) does not receive any additional pay15 ment or adjustment under such section, such as 

16 payments for indirect medical education costs 

17 under subsection (d)(5)(B) of such section, dis18 proportionate share payments under subsection 

19 (d)(5)(A) of such section, payments to a rural 

20 referral center under subsection (d)(5)(C) of 

21 such section, payments to a critical access hos22 pital under section 1814(l) of such Act (42 

23 U.S.C. 1395f(l)), payments to a sole community 

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1 ent, small rural hospital under subsection 

2 (d)(5)(G) of such section 1886; and 

3 (B) for which more than 60 percent of its 

4 inpatient days or discharges during 2 of the 3 

5 most recently audited cost reporting periods for 

6 which the Secretary has a settled cost report 

7 were attributable to inpatients entitled to bene8 fits under part A of title XVIII of such Act. 

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

10 of enactment of this Act, the Secretary shall submit to 

11 Congress a report containing the results of the study con12 ducted under subsection (a), together with recommenda13 tions for such legislation and administrative action as the 

14 Secretary determines appropriate. 

15 Subtitle C—Provisions Relating to 

16 Part C 

17 SEC. 3201. MEDICARE ADVANTAGE PAYMENT. 

18 (a) MA BENCHMARK BASED ON PLAN’S COMPETI19 TIVE BIDS.— 

20 (1) IN GENERAL.—Section 1853(j) of the Social 

21 Security Act (42 U.S.C. 1395w–23(j)) is amended— 

22 (A) by striking ‘‘AMOUNTS.—For pur23 poses’’ and inserting ′′AMOUNTS.— 

24 ‘‘(1) IN GENERAL.—For purposes’’; 


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1 (B) by redesignating paragraphs (1) and 

2 (2) as subparagraphs (A) and (B), respectively, 

3 and indenting the subparagraphs appropriately; 

4 (C) in subparagraph (A), as redesignated 

5 by subparagraph (B)— 

6 (i) by redesignating subparagraphs 

7 (A) and (B) as clauses (i) and (ii), respec8 tively, and indenting the clauses appro9 priately; and 

10 (ii) in clause (i), as redesignated by 

11 clause (i), by striking ‘‘an amount equal 

12 to’’ and all that follows through the end 

13 and inserting ‘‘an amount equal to— 

‘‘(I) for years before 2007, 1 14 ⁄12 of 

15 the annual MA capitation rate under 

16 section 1853(c)(1) for the area for the 

17 year, adjusted as appropriate for the 

18 purpose of risk adjustment; 

‘‘(II) for 2007 through 2011, 1 19 ⁄12

20 of the applicable amount determined 

21 under subsection (k)(1) for the area 

22 for the year; 

23 ‘‘(III) for 2012, the sum of— 

‘‘(aa) 2 24 ⁄3 of the quotient 

25 of— 


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1 ‘‘(AA) the applicable 

2 amount determined under 

3 subsection (k)(1) for the 

4 area for the year; and 

5 ‘‘(BB) 12; and 

‘‘(bb) 1 6 ⁄3 of the MA competi7 tive benchmark amount (deter8 mined under paragraph (2)) for 

9 the area for the month; 

10 ‘‘(IV) for 2013, the sum of— 

‘‘(aa) 1 11 ⁄3 of the quotient 

12 of— 

13 ‘‘(AA) the applicable 

14 amount determined under 

15 subsection (k)(1) for the 

16 area for the year; and 

17 ‘‘(BB) 12; and 

‘‘(bb) 2 18 ⁄3 of the MA competi19 tive benchmark amount (as so 

20 determined) for the area for the 

21 month; 

22 ‘‘(V) for 2014, the MA competi23 tive benchmark amount for the area 

24 for a month in 2013 (as so deter25 mined), increased by the national per 


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1 capita MA growth percentage, de2 scribed in subsection (c)(6) for 2014, 

3 but not taking into account any ad4 justment under subparagraph (C) of 

5 such subsection for a year before 

6 2004; and 

7 ‘‘(VI) for 2015 and each subse8 quent year, the MA competitive 

9 benchmark amount (as so determined) 

10 for the area for the month; or’’; 

11 (iii) in clause (ii), as redesignated by 

12 clause (i), by striking ‘‘subparagraph (A)’’ 

13 and inserting ‘‘clause (i)’’; 

14 (D) by adding at the end the following new 

15 paragraphs: 

16 ‘‘(2) COMPUTATION OF MA COMPETITIVE

17 BENCHMARK AMOUNT.— 

18 ‘‘(A) IN GENERAL.—Subject to subpara19 graph (B) and paragraph (3), for months in 

20 each year (beginning with 2012) for each MA 

21 payment area the Secretary shall compute an 

22 MA competitive benchmark amount equal to the 

23 weighted average of the unadjusted MA statu24 tory non-drug monthly bid amount (as defined 

25 in section 1854(b)(2)(E)) for each MA plan in 


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1 the area, with the weight for each plan being 

2 equal to the average number of beneficiaries en3 rolled under such plan in the reference month 

4 (as defined in section 1858(f)(4), except that, 

5 in applying such definition for purposes of this 

6 paragraph, ‘to compute the MA competitive 

7 benchmark amount under section 1853(j)(2)’ 

8 shall be substituted for ‘to compute the percent9 age specified in subparagraph (A) and other 

10 relevant percentages under this part’). 

11 ‘‘(B) WEIGHTING RULES.— 

12 ‘‘(i) SINGLE PLAN RULE.—In the case 

13 of an MA payment area in which only a 

14 single MA plan is being offered, the weight 

15 under subparagraph (A) shall be equal to 

16 1. 

17 ‘‘(ii) USE OF SIMPLE AVERAGE AMONG

18 MULTIPLE PLANS IF NO PLANS OFFERED

19 IN PREVIOUS YEAR.—In the case of an MA 

20 payment area in which no MA plan was of21 fered in the previous year and more than 

22 1 MA plan is offered in the current year, 

23 the Secretary shall use a simple average of 

24 the unadjusted MA statutory non-drug 

25 monthly bid amount (as so defined) for 


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1 purposes of computing the MA competitive 

2 benchmark amount under subparagraph 

3 (A). 

4 ‘‘(3) CAP ON MA COMPETITIVE BENCHMARK

5 AMOUNT.—In no case shall the MA competitive 

6 benchmark amount for an area for a month in a 

7 year be greater than the applicable amount that 

8 would (but for the application of this subsection) be 

9 determined under subsection (k)(1) for the area for 

10 the month in the year.’’; and 

11 (E) in subsection (k)(2)(B)(ii)(III), by 

12 striking ‘‘(j)(1)(A)’’ and inserting 

13 ‘‘(j)(1)(A)(i)’’. 

14 (2) CONFORMING AMENDMENTS.— 

15 (A) Section 1853(k)(2) of the Social Secu16 rity Act (42 U.S.C. 1395w–23(k)(2)) is amend17 ed— 

18 (i) in subparagraph (A), by striking 

19 ‘‘through 2010’’ and inserting ‘‘and subse20 quent years’’; and 

21 (ii) in subparagraph (C)— 

22 (I) in clause (iii), by striking 

23 ‘‘and’’ at the end; 


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1 (II) in clause (iv), by striking the 

2 period at the end and inserting ‘‘; 

3 and’’; and 

4 (III) by adding at the end the 

5 following new clause: 

6 ‘‘(v) for 2011 and subsequent years, 

7 0.00.’’. 

8 (B) Section 1854(b) of the Social Security 

9 Act (42 U.S.C. 1395w–24(b)) is amended— 

10 (i) in paragraph (3)(B)(i), by striking 

11 ‘‘1853(j)(1)’’ and inserting 

12 ‘‘1853(j)(1)(A)’’; and 

13 (ii) in paragraph (4)(B)(i), by striking 

14 ‘‘1853(j)(2)’’ and inserting 

15 ‘‘1853(j)(1)(B)’’. 

16 (C) Section 1858(f) of the Social Security 

17 Act (42 U.S.C. 1395w–27(f)) is amended— 

18 (i) in paragraph (1), by striking 

19 ‘‘1853(j)(2)’’ and inserting 

20 ‘‘1853(j)(1)(B)’’; and 

21 (ii) in paragraph (3)(A), by striking 

22 ‘‘1853(j)(1)(A)’’ and inserting 

23 ‘‘1853(j)(1)(A)(i)’’. 

24 (D) Section 1860C–1(d)(1)(A) of the So25 cial Security Act (42 U.S.C. 1395w– 


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1 29(d)(1)(A)) is amended by striking 

2 ‘‘1853(j)(1)(A)’’ and inserting 

3 ‘‘1853(j)(1)(A)(i)’’. 

4 (b) REDUCTION OF NATIONAL PER CAPITA GROWTH

5 PERCENTAGE FOR 2011.—Section 1853(c)(6) of the So6 cial Security Act (42 U.S.C. 1395w–23(c)(6)) is amend7 ed— 

8 (1) in clause (v), by striking ‘‘and’’ at the end; 

9 (2) in clause (vi)— 

10 (A) by striking ‘‘for a year after 2002’’ 

11 and inserting ‘‘for 2003 through 2010’’; and 

12 (B) by striking the period at the end and 

13 inserting a comma; and 

14 (C) by adding at the end the following new 

15 clauses: 

16 ‘‘(vii) for 2011, 3 percentage points; 

17 and 

18 ‘‘(viii) for a year after 2011, 0 per19 centage points.’’. 

20 (c) ENHANCEMENT OF BENEFICIARY REBATES.— 

21 Section 1854(b)(1)(C)(i) of the Social Security Act (42 

22 U.S.C. 1395w–24(b)(1)(C)(i)) is amended by inserting 

23 ‘‘(or 100 percent in the case of plan years beginning on 

24 or after January 1, 2014)’’ after ‘‘75 percent’’. 

25 (d) BIDDING RULES.— 


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1 (1) REQUIREMENTS FOR INFORMATION SUB2 MITTED.—Section 1854(a)(6)(A) of the Social Secu3 rity Act (42 U.S.C. 1395w–24(a)(6)(A)) is amended, 

4 in the flush matter following clause (v), by adding 

5 at the end the following sentence: ‘‘Information to 

6 be submitted under this paragraph shall be certified 

7 by a qualified member of the American Academy of 

8 Actuaries and shall meet actuarial guidelines and 

9 rules established by the Secretary under subpara10 graph (B)(v).’’. 

11 (2) ESTABLISHMENT OF ACTUARIAL GUIDE12 LINES.—Section 1854(a)(6)(B) of the Social Secu13 rity Act (42 U.S.C. 1395w–24(a)(6)(B)) is amend14 ed— 

15 (A) in clause (i), by striking ‘‘(iii) and 

16 (iv)’’ and inserting ‘‘(iii), (iv), and (v)’’; and 

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

18 clause: 

19 ‘‘(v) ESTABLISHMENT OF ACTUARIAL

20 GUIDELINES.— 

21 ‘‘(I) IN GENERAL.—In order to 

22 establish fair MA competitive bench23 marks under section 1853(j)(1)(A)(i), 

24 the Secretary, acting through the 

25 Chief Actuary of the Centers for 


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1 Medicare & Medicaid Services (in this 

2 clause referred to as the ‘Chief Actu3 ary’), shall establish— 

4 ‘‘(aa) actuarial guidelines 

5 for the submission of bid infor6 mation under this paragraph; 

7 and 

8 ‘‘(bb) bidding rules that are 

9 appropriate to ensure accurate 

10 bids and fair competition among 

11 MA plans. 

12 ‘‘(II) DENIAL OF BID

13 AMOUNTS.—The Secretary shall deny 

14 monthly bid amounts submitted under 

15 subparagraph (A) that do not meet 

16 the actuarial guidelines and rules es17 tablished under subclause (I). 

18 ‘‘(III) REFUSAL TO ACCEPT CER19 TAIN BIDS DUE TO MISREPRESENTA20 TIONS AND FAILURES TO ADE21 QUATELY MEET REQUIREMENTS.—In 

22 the case where the Secretary deter23 mines that information submitted by 

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1 representations and failures to ade2 quately meet requirements of the or3 ganization, the Secretary may refuse 

4 to accept any additional such bid 

5 amounts from the organization for the 

6 plan year and the Chief Actuary shall, 

7 if the Chief Actuary determines that 

8 the actuaries of the organization were 

9 complicit in those misrepresentations 

10 and failures, report those actuaries to 

11 the Actuarial Board for Counseling 

12 and Discipline.’’. 

13 (3) EFFECTIVE DATE.—The amendments made 

14 by this subsection shall apply to bid amounts sub15 mitted on or after January 1, 2012. 

16 (e) MA LOCAL PLAN SERVICE AREAS.— 

17 (1) IN GENERAL.—Section 1853(d) of the So18 cial Security Act (42 U.S.C. 1395w–23(d)) is 

19 amended— 

20 (A) in the subsection heading, by striking 

21 ‘‘MA REGION’’ and inserting ‘‘MA REGION; MA 

22 LOCAL PLAN SERVICE AREA’’; 

23 (B) in paragraph (1), by striking subpara24 graph (A) and inserting the following: 

25 ‘‘(A) with respect to an MA local plan— 


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1 ‘‘(i) for years before 2012, an MA 

2 local area (as defined in paragraph (2)); 

3 and 

4 ‘‘(ii) for 2012 and succeeding years, a 

5 service area that is an entire urban or 

6 rural area, as applicable (as described in 

7 paragraph (5)); and’’; and 

8 (C) by adding at the end the following new 

9 paragraph: 

10 ‘‘(5) MA LOCAL PLAN SERVICE AREA.—For 

11 2012 and succeeding years, the service area for an 

12 MA local plan shall be an entire urban or rural area 

13 in each State as follows: 

14 ‘‘(A) URBAN AREAS.— 

15 ‘‘(i) IN GENERAL.—Subject to clause 

16 (ii) and subparagraphs (C) and (D), the 

17 service area for an MA local plan in an 

18 urban area shall be the Core Based Statis19 tical Area (in this paragraph referred to as 

20 a ‘CBSA’) or, if applicable, a conceptually 

21 similar alternative classification, as defined 

22 by the Director of the Office of Manage23 ment and Budget. 

24 ‘‘(ii) CBSA COVERING MORE THAN

25 ONE STATE.—In the case of a CBSA (or 


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1 alternative classification) that covers more 

2 than one State, the Secretary shall divide 

3 the CBSA (or alternative classification) 

4 into separate service areas with respect to 

5 each State covered by the CBSA (or alter6 native classification). 

7 ‘‘(B) RURAL AREAS.—Subject to subpara8 graphs (C) and (D), the service area for an MA 

9 local plan in a rural area shall be a county that 

10 does not qualify for inclusion in a CBSA (or al11 ternative classification), as defined by the Di12 rector of the Office of Management and Budg13 et. 

14 ‘‘(C) REFINEMENTS TO SERVICE AREAS.— 

15 For 2015 and succeeding years, in order to re16 flect actual patterns of health care service utili17 zation, the Secretary may adjust the boundaries 

18 of service areas for MA local plans in urban 

19 areas and rural areas under subparagraphs (A) 

20 and (B), respectively, but may only do so based 

21 on recent analyses of actual patterns of care. 

22 ‘‘(D) ADDITIONAL AUTHORITY TO MAKE

23 LIMITED EXCEPTIONS TO SERVICE AREA RE24 QUIREMENTS FOR MA LOCAL PLANS.—The Sec25 retary may, in addition to any adjustments 


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1 under subparagraph (C), make limited excep2 tions to service area requirements otherwise ap3 plicable under this part for MA local plans that 

4 have in effect (as of the date of enactment of 

5 the Patient Protection and Affordable Care 

6 Act)— 

7 ‘‘(i) agreements with another MA or8 ganization or MA plan that preclude the 

9 offering of benefits throughout an entire 

10 service area; or 

11 ‘‘(ii) limitations in their structural ca12 pacity to support adequate networks 

13 throughout an entire service area as a re14 sult of the delivery system model of the 

15 MA local plan.’’. 

16 (2) CONFORMING AMENDMENTS.— 

17 (A) IN GENERAL.— 

18 (i) Section 1851(b)(1) of the Social 

19 Security Act (42 U.S.C. 1395w–21(b)(1)) 

20 is amended by striking subparagraph (C). 

21 (ii) Section 1853(b)(1)(B)(i) of such 

22 Act (42 U.S.C. 1395w–23(b)(1)(B)(i))— 

23 (I) in the matter preceding sub24 clause (I), by striking ‘‘MA payment 


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1 area’’ and inserting ‘‘MA local area 

2 (as defined in subsection (d)(2))’’; and 

3 (II) in subclause (I), by striking 

4 ‘‘MA payment area’’ and inserting 

5 ‘‘MA local area (as so defined)’’. 

6 (iii) Section 1853(b)(4) of such Act 

7 (42 U.S.C. 1395w–23(b)(4)) is amended 

8 by striking ‘‘Medicare Advantage payment 

9 area’’ and inserting ‘‘MA local area (as so 

10 defined)’’. 

11 (iv) Section 1853(c)(1) of such Act 

12 (42 U.S.C. 1395w–23(c)(1)) is amended— 

13 (I) in the matter preceding sub14 paragraph (A), by striking ‘‘a Medi15 care Advantage payment area that 

16 is’’; and 

17 (II) in subparagraph (D)(i), by 

18 striking ‘‘MA payment area’’ and in19 serting ‘‘MA local area (as defined in 

20 subsection (d)(2))’’. 

21 (v) Section 1854 of such Act (42 

22 U.S.C. 1395w–24) is amended by striking 

23 subsection (h). 


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1 (B) EFFECTIVE DATE.—The amendments 

2 made by this paragraph shall take effect on 

3 January 1, 2012. 

4 (f) PERFORMANCE BONUSES.— 

5 (1) MA PLANS.— 

6 (A) IN GENERAL.—Section 1853 of the So7 cial Security Act (42 U.S.C. 1395w–23) is 

8 amended by adding at the end the following 

9 new subsection: 

10 ‘‘(n) PERFORMANCE BONUSES.— 

11 ‘‘(1) CARE COORDINATION AND MANAGEMENT

12 PERFORMANCE BONUS.— 

13 ‘‘(A) IN GENERAL.—For years beginning 

14 with 2014, subject to subparagraph (B), in the 

15 case of an MA plan that conducts 1 or more 

16 programs described in subparagraph (C) with 

17 respect to the year, the Secretary shall, in addi18 tion to any other payment provided under this 

19 part, make monthly payments, with respect to 

20 coverage of an individual under this part, to the 

21 MA plan in an amount equal to the product 

22 of— 

23 ‘‘(i) 0.5 percent of the national 

24 monthly per capita cost for expenditures 

25 for individuals enrolled under the original 


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1 medicare fee-for-service program for the 

2 year; and 

3 ‘‘(ii) the total number of programs de4 scribed in clauses (i) through (ix) of sub5 paragraph (C) that the Secretary deter6 mines the plan is conducting for the year 

7 under such subparagraph. 

8 ‘‘(B) LIMITATION.—In no case may the 

9 total amount of payment with respect to a year 

10 under subparagraph (A) be greater than 2 per11 cent of the national monthly per capita cost for 

12 expenditures for individuals enrolled under the 

13 original medicare fee-for-service program for 

14 the year, as determined prior to the application 

15 of risk adjustment under paragraph (4). 

16 ‘‘(C) PROGRAMS DESCRIBED.—The fol17 lowing programs are described in this para18 graph: 

19 ‘‘(i) Care management programs 

20 that— 

21 ‘‘(I) target individuals with 1 or 

22 more chronic conditions; 

23 ‘‘(II) identify gaps in care; and 

24 ‘‘(III) facilitate improved care by 

25 using additional resources like nurses, 


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1 nurse practitioners, and physician as2 sistants. 

3 ‘‘(ii) Programs that focus on patient 

4 education and self-management of health 

5 conditions, including interventions that— 

6 ‘‘(I) help manage chronic condi7 tions; 

8 ‘‘(II) reduce declines in health 

9 status; and 

10 ‘‘(III) foster patient and provider 

11 collaboration. 

12 ‘‘(iii) Transitional care interventions 

13 that focus on care provided around a hos14 pital inpatient episode, including programs 

15 that target post-discharge patient care in 

16 order to reduce unnecessary health com17 plications and readmissions. 

18 ‘‘(iv) Patient safety programs, includ19 ing provisions for hospital-based patient 

20 safety programs in contracts that the 

21 Medicare Advantage organization offering 

22 the MA plan has with hospitals. 

23 ‘‘(v) Financial policies that promote 

24 systematic coordination of care by primary 

25 care physicians across the full spectrum of 


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1 specialties and sites of care, such as med2 ical homes, capitation arrangements, or 

3 pay-for-performance programs. 

4 ‘‘(vi) Programs that address, identify, 

5 and ameliorate health care disparities 

6 among principal at-risk subpopulations. 

7 ‘‘(vii) Medication therapy manage8 ment programs that are more extensive 

9 than is required under section 1860D–4(c) 

10 (as determined by the Secretary). 

11 ‘‘(viii) Health information technology 

12 programs, including clinical decision sup13 port and other tools to facilitate data col14 lection and ensure patient-centered, appro15 priate care. 

16 ‘‘(ix) Such other care management 

17 and coordination programs as the Sec18 retary determines appropriate. 

19 ‘‘(D) CONDUCT OF PROGRAM IN URBAN

20 AND RURAL AREAS.—An MA plan may conduct 

21 a program described in subparagraph (C) in a 

22 manner appropriate for an urban or rural area, 

23 as applicable. 

24 ‘‘(E) REPORTING OF DATA.—Each Medi25 care Advantage organization shall provide to 


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1 the Secretary the information needed to deter2 mine whether they are eligible for a care coordi3 nation and management performance bonus at 

4 a time and in a manner specified by the Sec5 retary. 

6 ‘‘(F) PERIODIC AUDITING.—The Secretary 

7 shall provide for the annual auditing of pro8 grams described in subparagraph (C) for which 

9 an MA plan receives a care coordination and 

10 management performance bonus under this 

11 paragraph. The Comptroller General shall mon12 itor auditing activities conducted under this 

13 subparagraph. 

14 ‘‘(2) QUALITY PERFORMANCE BONUSES.— 

15 ‘‘(A) QUALITY BONUS.—For years begin16 ning with 2014, the Secretary shall, in addition 

17 to any other payment provided under this part, 

18 make monthly payments, with respect to cov19 erage of an individual under this part, to an 

20 MA plan that achieves at least a 3 star rating 

21 (or comparable rating) on a rating system de22 scribed in subparagraph (C) in an amount 

23 equal to— 

24 ‘‘(i) in the case of a plan that achieves 

25 a 3 star rating (or comparable rating) on 


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1 such system 2 percent of the national 

2 monthly per capita cost for expenditures 

3 for individuals enrolled under the original 

4 medicare fee-for-service program for the 

5 year; and 

6 ‘‘(ii) in the case of a plan that 

7 achieves a 4 or 5 star rating (or com8 parable rating on such system, 4 percent 

9 of such national monthly per capita cost 

10 for the year. 

11 ‘‘(B) IMPROVED QUALITY BONUS.—For 

12 years beginning with 2014, in the case of an 

13 MA plan that does not receive a quality bonus 

14 under subparagraph (A) and is an improved 

15 quality MA plan with respect to the year (as 

16 identified by the Secretary), the Secretary shall, 

17 in addition to any other payment provided 

18 under this part, make monthly payments, with 

19 respect to coverage of an individual under this 

20 part, to the MA plan in an amount equal to 1 

21 percent of such national monthly per capita 

22 cost for the year. 

23 ‘‘(C) USE OF RATING SYSTEM.—For pur24 poses of subparagraph (A), a rating system de25 scribed in this paragraph is— 


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1 ‘‘(i) a rating system that uses up to 5 

2 stars to rate clinical quality and enrollee 

3 satisfaction and performance at the Medi4 care Advantage contract or MA plan level; 

5 or 

6 ‘‘(ii) such other system established by 

7 the Secretary that provides for the deter8 mination of a comparable quality perform9 ance rating to the rating system described 

10 in clause (i). 

11 ‘‘(D) DATA USED IN DETERMINING

12 SCORE.— 

13 ‘‘(i) IN GENERAL.—The rating of an 

14 MA plan under the rating system described 

15 in subparagraph (C) with respect to a year 

16 shall be based on based on the most recent 

17 data available. 

18 ‘‘(ii) PLANS THAT FAIL TO REPORT

19 DATA.—An MA plan which does not report 

20 data that enables the Secretary to rate the 

21 plan for purposes of subparagraph (A) or 

22 identify the plan for purposes of subpara23 graph (B) shall be counted, for purposes of 

24 such rating or identification, as having the 

25 lowest plan performance rating and the 


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1 lowest percentage improvement, respec2 tively. 

3 ‘‘(3) QUALITY BONUS FOR NEW AND LOW EN4 ROLLMENT MA PLANS.— 

5 ‘‘(A) NEW MA PLANS.—For years begin6 ning with 2014, in the case of an MA plan that 

7 first submits a bid under section 1854(a)(1)(A) 

8 for 2012 or a subsequent year, only receives en9 rollments made during the coverage election pe10 riods described in section 1851(e), and is not 

11 able to receive a bonus under subparagraph (A) 

12 or (B) of paragraph (2) for the year, the Sec13 retary shall, in addition to any other payment 

14 provided under this part, make monthly pay15 ments, with respect to coverage of an individual 

16 under this part, to the MA plan in an amount 

17 equal to 2 percent of national monthly per cap18 ita cost for expenditures for individuals enrolled 

19 under the original medicare fee-for-service pro20 gram for the year. In its fourth year of oper21 ation, the MA plan shall be paid in the same 

22 manner as other MA plans with comparable en23 rollment. 

24 ‘‘(B) LOW ENROLLMENT PLANS.—For 

25 years beginning with 2014, in the case of an 


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1 MA plan that has low enrollment (as defined by 

2 the Secretary) and would not otherwise be able 

3 to receive a bonus under subparagraph (A) or 

4 (B) of paragraph (2) or subparagraph (A) of 

5 this paragraph for the year (referred to in this 

6 subparagraph as a ‘low enrollment plan’), the 

7 Secretary shall use a regional or local mean of 

8 the rating of all MA plans in the region or local 

9 area, as determined appropriate by the Sec10 retary, on measures used to determine whether 

11 MA plans are eligible for a quality or an im12 proved quality bonus, as applicable, to deter13 mine whether the low enrollment plan is eligible 

14 for a bonus under such a subparagraph. 

15 ‘‘(4) RISK ADJUSTMENT.—The Secretary shall 

16 risk adjust a performance bonus under this sub17 section in the same manner as the Secretary risk ad18 justs beneficiary rebates described in section 

19 1854(b)(1)(C). 

20 ‘‘(5) NOTIFICATION.—The Secretary, in the an21 nual announcement required under subsection 

22 (b)(1)(B) for 2014 and each succeeding year, shall 

23 notify the Medicare Advantage organization of any 

24 performance bonus (including a care coordination 

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1 graph (1), a quality performance bonus under para2 graph (2), and a quality bonus for new and low en3 rollment plans under paragraph (3)) that the organi4 zation will receive under this subsection with respect 

5 to the year. The Secretary shall provide for the pub6 lication of the information described in the previous 

7 sentence on the Internet website of the Centers for 

8 Medicare & Medicaid Services.’’ 

9 (B) CONFORMING AMENDMENT.—Section 

10 1853(a)(1)(B) of the Social Security Act (42 

11 U.S.C. 1395w–23(a)(1)(B)) is amended— 

12 (i) in clause (i), by inserting ‘‘and any 

13 performance bonus under subsection (n)’’ 

14 before the period at the end; and 

15 (ii) in clause (ii), by striking ‘‘(G)’’ 

16 and inserting ‘‘(G), plus the amount (if 

17 any) of any performance bonus under sub18 section (n)’’. 

19 (2) APPLICATION OF PERFORMANCE BONUSES

20 TO MA REGIONAL PLANS.—Section 1858 of the So21 cial Security Act (42 U.S.C. 1395w–27a) is amend22 ed— 

23 (A) in subsection (f)(1), by striking ‘‘sub24 section (e)’’ and inserting ‘‘subsections (e) and 

25 (i)’’; and 


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

2 subsection: 

3 ‘‘(i) APPLICATION OF PERFORMANCE BONUSES TO

4 MA REGIONAL PLANS.—For years beginning with 2014, 

5 the Secretary shall apply the performance bonuses under 

6 section 1853(n) (relating to bonuses for care coordination 

7 and management, quality performance, and new and low 

8 enrollment MA plans) to MA regional plans in a similar 

9 manner as such performance bonuses apply to MA plans 

10 under such subsection.’’. 

11 (g) GRANDFATHERING SUPPLEMENTAL BENEFITS

12 FOR CURRENT ENROLLEES AFTER IMPLEMENTATION OF

13 COMPETITIVE BIDDING.—Section 1853 of the Social Se14 curity Act (42 U.S.C. 1395w–23), as amended by sub15 section (f), is amended by adding at the end the following 

16 new subsection: 

17 ‘‘(o) GRANDFATHERING SUPPLEMENTAL BENEFITS

18 FOR CURRENT ENROLLES AFTER IMPLEMENTATION OF

19 COMPETITIVE BIDDING.— 

20 ‘‘(1) IDENTIFICATION OF AREAS.—The Sec21 retary shall identify MA local areas in which, with 

22 respect to 2009, average bids submitted by an MA 

23 organization under section 1854(a) for MA local 

24 plans in the area are not greater than 75 percent of 

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1 volved, determined under section 1876(a)(4), for the 

2 area for individuals who are not enrolled in an MA 

3 plan under this part for the year, but adjusted to ex4 clude costs attributable to payments under section 

5 1848(o), 1886(n), and 1886(h). 

6 ‘‘(2) ELECTION TO PROVIDE REBATES TO

7 GRANDFATHERED ENROLLEES.— 

8 ‘‘(A) IN GENERAL.—For years beginning 

9 with 2012, each Medicare Advantage organiza10 tion offering an MA local plan in an area iden11 tified by the Secretary under paragraph (1) 

12 may elect to provide rebates to grandfathered 

13 enrollees under section 1854(b)(1)(C). In the 

14 case where an MA organization makes such an 

15 election, the monthly per capita dollar amount 

16 of such rebates shall not exceed the applicable 

17 amount for the year (as defined in subpara18 graph (B)). 

19 ‘‘(B) APPLICABLE AMOUNT.—For purposes 

20 of this subsection, the term ‘applicable amount’ 

21 means— 

22 ‘‘(i) for 2012, the monthly per capita 

23 dollar amount of such rebates provided to 

24 enrollees under the MA local plan with re25 spect to 2011; and 


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1 ‘‘(ii) for a subsequent year, 95 percent 

2 of the amount determined under this sub3 paragraph for the preceding year. 

4 ‘‘(3) SPECIAL RULES FOR PLANS IN IDENTI5 FIED AREAS.—Notwithstanding any other provision 

6 of this part, the following shall apply with respect to 

7 each Medicare Advantage organization offering an 

8 MA local plan in an area identified by the Secretary 

9 under paragraph (1) that makes an election de10 scribed in paragraph (2): 

11 ‘‘(A) PAYMENTS.—The amount of the 

12 monthly payment under this section to the 

13 Medicare Advantage organization, with respect 

14 to coverage of a grandfathered enrollee under 

15 this part in the area for a month, shall be equal 

16 to— 

17 ‘‘(i) for 2012 and 2013, the sum of— 

18 ‘‘(I) the bid amount under sec19 tion 1854(a) for the MA local plan; 

20 and 

21 ‘‘(II) the applicable amount (as 

22 defined in paragraph (2)(B)) for the 

23 MA local plan for the year. 

24 ‘‘(ii) for 2014 and subsequent years, 

25 the sum of— 


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1 ‘‘(I) the MA competitive bench2 mark amount under subsection 

3 (j)(1)(A)(i) for the area for the 

4 month, adjusted, only to the extent 

5 the Secretary determines necessary, to 

6 account for induced utilization as a 

7 result of rebates provided to grand8 fathered enrollees (except that such 

9 adjustment shall not exceed 0.5 per10 cent of such MA competitive bench11 mark amount); and 

12 ‘‘(II) the applicable amount (as 

13 so defined) for the MA local plan for 

14 the year. 

15 ‘‘(B) REQUIREMENT TO SUBMIT BIDS

16 UNDER COMPETITIVE BIDDING.—The Medicare 

17 Advantage organization shall submit a single 

18 bid amount under section 1854(a) for the MA 

19 local plan. The Medicare Advantage organiza20 tion shall remove from such bid amount any ef21 fects of induced demand for care that may re22 sult from the higher rebates available to grand23 fathered enrollees under this subsection. 

24 ‘‘(C) NONAPPLICATION OF BONUS PAY25 MENTS AND ANY OTHER REBATES.—The MediVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00897 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 care Advantage organization offering the MA 

2 local plan shall not be eligible for any bonus 

3 payment under subsection (n) or any rebate 

4 under this part (other than as provided under 

5 this subsection) with respect to grandfathered 

6 enrollees. 

7 ‘‘(D) NONAPPLICATION OF UNIFORM BID

8 AND PREMIUM AMOUNTS TO GRANDFATHERED

9 ENROLLEES.—Section 1854(c) shall not apply 

10 with respect to the MA local plan. 

11 ‘‘(E) NONAPPLICATION OF LIMITATION ON

12 APPLICATION OF PLAN REBATES TOWARD PAY13 MENT OF PART B PREMIUM.—Notwithstanding 

14 clause (iii) of section 1854(b)(1)(C), in the case 

15 of a grandfathered enrollee, a rebate under such 

16 section may be used for the purpose described 

17 in clause (ii)(III) of such section. 

18 ‘‘(F) RISK ADJUSTMENT.—The Secretary 

19 shall risk adjust rebates to grandfathered en20 rollees under this subsection in the same man21 ner as the Secretary risk adjusts beneficiary re22 bates described in section 1854(b)(1)(C). 

23 ‘‘(4) DEFINITION OF GRANDFATHERED EN24 ROLLEE.—In this subsection, the term ‘grand25 fathered enrollee’ means an individual who is enVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00898 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 rolled (effective as of the date of enactment of this 

2 subsection) in an MA local plan in an area that is 

3 identified by the Secretary under paragraph (1).’’. 

4 (h) TRANSITIONAL EXTRA BENEFITS.—Section 1853 

5 of the Social Security Act (42 U.S.C. 1395w–23), as 

6 amended by subsections (f) and (g), is amended by adding 

7 at the end the following new subsection: 

8 ‘‘(p) TRANSITIONAL EXTRA BENEFITS.— 

9 ‘‘(1) IN GENERAL.—For years beginning with 

10 2012, the Secretary shall provide transitional re11 bates under section 1854(b)(1)(C) for the provision 

12 of extra benefits (as specified by the Secretary) to 

13 enrollees described in paragraph (2). 

14 ‘‘(2) ENROLLEES DESCRIBED.—An enrollee de15 scribed in this paragraph is an individual who— 

16 ‘‘(A) enrolls in an MA local plan in an ap17 plicable area; and 

18 ‘‘(B) experiences a significant reduction in 

19 extra benefits described in clause (ii) of section 

20 1854(b)(1)(C) as a result of competitive bidding 

21 under this part (as determined by the Sec22 retary). 

23 ‘‘(3) APPLICABLE AREAS.—In this subsection, 

24 the term ‘applicable area’ means the following: 


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1 ‘‘(A) The 2 largest metropolitan statistical 

2 areas, if the Secretary determines that the total 

3 amount of such extra benefits for each enrollee 

4 for the month in those areas is greater than 

5 $100. 

6 ‘‘(B) A county where— 

7 ‘‘(i) the MA area-specific non-drug 

8 monthly benchmark amount for a month in 

9 2011 is equal to the legacy urban floor 

10 amount (as described in subsection 

11 (c)(1)(B)(iii)), as determined by the Sec12 retary for the area for 2011; 

13 ‘‘(ii) the percentage of Medicare Ad14 vantage eligible beneficiaries in the county 

15 who are enrolled in an MA plan for 2009 

16 is greater than 30 percent (as determined 

17 by the Secretary); and 

18 ‘‘(iii) average bids submitted by an 

19 MA organization under section 1854(a) for 

20 MA local plans in the county for 2011 are 

21 not greater than the adjusted average per 

22 capita cost for the year involved, deter23 mined under section 1876(a)(4), for the 

24 county for individuals who are not enrolled 

25 in an MA plan under this part for the 


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1 year, but adjusted to exclude costs attrib2 utable to payments under section 1848(o), 

3 1886(n), and 1886(h). 

4 ‘‘(C) If the Secretary determines appro5 priate, a county contiguous to an area or coun6 ty described in subparagraph (A) or (B), re7 spectively. 

8 ‘‘(4) REVIEW OF PLAN BIDS.—In the case of a 

9 bid submitted by an MA organization under section 

10 1854(a) for an MA local plan in an applicable area, 

11 the Secretary shall review such bid in order to en12 sure that extra benefits (as specified by the Sec13 retary) are provided to enrollees described in para14 graph (2). 

15 ‘‘(5) FUNDING.—The Secretary shall provide 

16 for the transfer from the Federal Hospital Insurance 

17 Trust Fund under section 1817 and the Federal 

18 Supplementary Medical Insurance Trust Fund es19 tablished under section 1841, in such proportion as 

20 the Secretary determines appropriate, of an amount 

21 not to exceed $5,000,000,000 for the period of fiscal 

22 years 2012 through 2019 for the purpose of pro23 viding transitional rebates under section 

24 1854(b)(1)(C) for the provision of extra benefits 

25 under this subsection.’’. 


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1 (i) NONAPPLICATION OF COMPETITIVE BIDDING AND

2 RELATED PROVISIONS AND CLARIFICATION OF MA PAY3 MENT AREA FOR PACE PROGRAMS.— 

4 (1) NONAPPLICATION OF COMPETITIVE BID5 DING AND RELATED PROVISIONS FOR PACE PRO6 GRAMS.—Section 1894 of the Social Security Act 

7 (42 U.S.C. 1395eee) is amended— 

8 (A) by redesignating subsections (h) and 

9 (i) as subsections (i) and (j), respectively; 

10 (B) by inserting after subsection (g) the 

11 following new subsection: 

12 ‘‘(h) NONAPPLICATION OF COMPETITIVE BIDDING

13 AND RELATED PROVISIONS UNDER PART C.—With re14 spect to a PACE program under this section, the following 

15 provisions (and regulations relating to such provisions) 

16 shall not apply: 

17 ‘‘(1) Section 1853(j)(1)(A)(i), relating to MA 

18 area-specific non-drug monthly benchmark amount 

19 being based on competitive bids. 

20 ‘‘(2) Section 1853(d)(5), relating to the estab21 lishment of MA local plan service areas. 

22 ‘‘(3) Section 1853(n), relating to the payment 

23 of performance bonuses. 


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1 ‘‘(4) Section 1853(o), relating to 

2 grandfathering supplemental benefits for current en3 rollees after implementation of competitive bidding. 

4 ‘‘(5) Section 1853(p), relating to transitional 

5 extra benefits.’’. 

6 (2) SPECIAL RULE FOR MA PAYMENT AREA FOR

7 PACE PROGRAMS.—Section 1853(d) of the Social Se8 curity Act (42 U.S.C. 1395w–23(d)), as amended by 

9 subsection (e), is amended by adding at the end the 

10 following new paragraph: 

11 ‘‘(6) SPECIAL RULE FOR MA PAYMENT AREA

12 FOR PACE PROGRAMS.—For years beginning with 

13 2012, in the case of a PACE program under section 

14 1894, the MA payment area shall be the MA local 

15 area (as defined in paragraph (2)).’’. 

16 SEC. 3202. BENEFIT PROTECTION AND SIMPLIFICATION. 

17 (a) LIMITATION ON VARIATION OF COST SHARING

18 FOR CERTAIN BENEFITS.— 

19 (1) IN GENERAL.—Section 1852(a)(1)(B) of the 

20 Social Security Act (42 U.S.C. 1395w–22(a)(1)(B)) 

21 is amended— 

22 (A) in clause (i), by inserting ‘‘, subject to 

23 clause (iii),’’ after ‘‘and B or’’; and 

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

25 clauses: 


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1 ‘‘(iii) LIMITATION ON VARIATION OF

2 COST SHARING FOR CERTAIN BENEFITS.— 

3 Subject to clause (v), cost-sharing for serv4 ices described in clause (iv) shall not ex5 ceed the cost-sharing required for those 

6 services under parts A and B. 

7 ‘‘(iv) SERVICES DESCRIBED.—The fol8 lowing services are described in this clause: 

9 ‘‘(I) Chemotherapy administra10 tion services. 

11 ‘‘(II) Renal dialysis services (as 

12 defined in section 1881(b)(14)(B)). 

13 ‘‘(III) Skilled nursing care. 

14 ‘‘(IV) Such other services that 

15 the Secretary determines appropriate 

16 (including services that the Secretary 

17 determines require a high level of pre18 dictability and transparency for bene19 ficiaries). 

20 ‘‘(v) EXCEPTION.—In the case of 

21 services described in clause (iv) for which 

22 there is no cost-sharing required under 

23 parts A and B, cost-sharing may be re24 quired for those services in accordance 

25 with clause (i).’’. 


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1 (2) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall apply to plan years begin3 ning on or after January 1, 2011. 

4 (b) APPLICATION OF REBATES, PERFORMANCE BO5 NUSES, AND PREMIUMS.— 

6 (1) APPLICATION OF REBATES.—Section 

7 1854(b)(1)(C) of the Social Security Act (42 U.S.C. 

8 1395w–24(b)(1)(C)) is amended— 

9 (A) in clause (ii), by striking ‘‘REBATE.— 

10 A rebate’’ and inserting ‘‘REBATE FOR PLAN

11 YEARS BEFORE 2012.—For plan years before 

12 2012, a rebate’’; 

13 (B) by redesignating clauses (iii) and (iv) 

14 as clauses (iv) and (v); and 

15 (C) by inserting after clause (ii) the fol16 lowing new clause: 

17 ‘‘(iii) FORM OF REBATE FOR PLAN

18 YEAR 2012 AND SUBSEQUENT PLAN

19 YEARS.—For plan years beginning on or 

20 after January 1, 2012, a rebate required 

21 under this subparagraph may not be used 

22 for the purpose described in clause (ii)(III) 

23 and shall be provided through the applica24 tion of the amount of the rebate in the fol25 lowing priority order: 


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1 ‘‘(I) First, to use the most sig2 nificant share to meaningfully reduce 

3 cost-sharing otherwise applicable for 

4 benefits under the original medicare 

5 fee-for-service program under parts A 

6 and B and for qualified prescription 

7 drug coverage under part D, including 

8 the reduction of any deductibles, co9 payments, and maximum limitations 

10 on out-of-pocket expenses otherwise 

11 applicable. Any reduction of maximum 

12 limitations on out-of-pocket expenses 

13 under the preceding sentence shall 

14 apply to all benefits under the original 

15 medicare fee-for-service program op16 tion. The Secretary may provide guid17 ance on meaningfully reducing cost18 sharing under this subclause, except 

19 that such guidance may not require a 

20 particular amount of cost-sharing or 

21 reduction in cost-sharing. 

22 ‘‘(II) Second, to use the next 

23 most significant share to meaningfully 

24 provide coverage of preventive and 

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1 fined by the Secretary) which are not 

2 benefits under the original medicare 

3 fee-for-service program, such as smok4 ing cessation, a free flu shot, and an 

5 annual physical examination. 

6 ‘‘(III) Third, to use the remain7 ing share to meaningfully provide cov8 erage of other health care benefits 

9 which are not benefits under the origi10 nal medicare fee-for-service program, 

11 such as eye examinations and dental 

12 coverage, and are not benefits de13 scribed in subclause (II).’’. 

14 (2) APPLICATION OF PERFORMANCE BO15 NUSES.—Section 1853(n) of the Social Security Act, 

16 as added by section 3201(f), is amended by adding 

17 at the end the following new paragraph: 

18 ‘‘(6) APPLICATION OF PERFORMANCE BO19 NUSES.—For plan years beginning on or after Janu20 ary 1, 2014, any performance bonus paid to an MA 

21 plan under this subsection shall be used for the pur22 poses, and in the priority order, described in sub23 clauses (I) through (III) of section 

24 1854(b)(1)(C)(iii).’’. 


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1 (3) APPLICATION OF MA MONTHLY SUPPLE2 MENTARY BENEFICIARY PREMIUM.—Section 

3 1854(b)(2)(C) of the Social Security Act (42 U.S.C. 

4 1395w–24(b)(2)(C)) is amended— 

5 (A) by striking ‘‘PREMIUM.—The term’’ 

6 and inserting ‘‘PREMIUM.— 

7 ‘‘(i) IN GENERAL.—The term’’; and 

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

9 clause: 

10 ‘‘(ii) APPLICATION OF MA MONTHLY

11 SUPPLEMENTARY BENEFICIARY PRE12 MIUM.—For plan years beginning on or 

13 after January 1, 2012, any MA monthly 

14 supplementary beneficiary premium 

15 charged to an individual enrolled in an MA 

16 plan shall be used for the purposes, and in 

17 the priority order, described in subclauses 

18 (I) through (III) of paragraph 

19 (1)(C)(iii).’’. 

20 SEC. 3203. APPLICATION OF CODING INTENSITY ADJUST21 MENT DURING MA PAYMENT TRANSITION. 

22 Section 1853(a)(1)(C) of the Social Security Act (42 

23 U.S.C. 1395w–23(a)(1)(C)) is amended by adding at the 

24 end the following new clause: 


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1 ‘‘(iii) APPLICATION OF CODING IN2 TENSITY ADJUSTMENT FOR 2011 AND SUB3 SEQUENT YEARS.— 

4 ‘‘(I) REQUIREMENT TO APPLY IN

5 2011 THROUGH 2013.—In order to en6 sure payment accuracy, the Secretary 

7 shall conduct an analysis of the dif8 ferences described in clause (ii)(I). 

9 The Secretary shall ensure that the 

10 results of such analysis are incor11 porated into the risk scores for 2011, 

12 2012, and 2013. 

13 ‘‘(II) AUTHORITY TO APPLY IN

14 2014 AND SUBSEQUENT YEARS.—The 

15 Secretary may, as appropriate, incor16 porate the results of such analysis 

17 into the risk scores for 2014 and sub18 sequent years.’’. 

19 SEC. 3204. SIMPLIFICATION OF ANNUAL BENEFICIARY 

20 ELECTION PERIODS. 

21 (a) ANNUAL 45-DAY PERIOD FOR DISENROLLMENT

22 FROM MA PLANS TO ELECT TO RECEIVE BENEFITS

23 UNDER THE ORIGINAL MEDICARE FEE-FOR-SERVICE

24 PROGRAM.— 


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1 (1) IN GENERAL.—Section 1851(e)(2)(C) of the 

2 Social Security Act (42 U.S.C. 1395w–1(e)(2)(C)) is 

3 amended to read as follows: 

4 ‘‘(C) ANNUAL 45-DAY PERIOD FOR

5 DISENROLLMENT FROM MA PLANS TO ELECT TO

6 RECEIVE BENEFITS UNDER THE ORIGINAL

7 MEDICARE FEE-FOR-SERVICE PROGRAM.—Sub8 ject to subparagraph (D), at any time during 

9 the first 45 days of a year (beginning with 

10 2011), an individual who is enrolled in a Medi11 care Advantage plan may change the election 

12 under subsection (a)(1), but only with respect 

13 to coverage under the original medicare fee-for14 service program under parts A and B, and may 

15 elect qualified prescription drug coverage in ac16 cordance with section 1860D–1.’’. 

17 (2) EFFECTIVE DATE.—The amendment made 

18 by paragraph (1) shall apply with respect to 2011 

19 and succeeding years. 

20 (b) TIMING OF THE ANNUAL, COORDINATED ELEC21 TION PERIOD UNDER PARTS C AND D.—Section 

22 1851(e)(3)(B) of the Social Security Act (42 U.S.C. 

23 1395w–1(e)(3)(B)) is amended— 

24 (1) in clause (iii), by striking ‘‘and’’ at the end; 

25 (2) in clause (iv)— 


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1 (A) by striking ‘‘and succeeding years’’ 

2 and inserting ‘‘, 2008, 2009, and 2010’’; and 

3 (B) by striking the period at the end and 

4 inserting ‘‘; and’’; and 

5 (3) by adding at the end the following new 

6 clause: 

7 ‘‘(v) with respect to 2012 and suc8 ceeding years, the period beginning on Oc9 tober 15 and ending on December 7 of the 

10 year before such year.’’. 

11 SEC. 3205. EXTENSION FOR SPECIALIZED MA PLANS FOR 

12 SPECIAL NEEDS INDIVIDUALS. 

13 (a) EXTENSION OF SNP AUTHORITY.—Section 

14 1859(f)(1) of the Social Security Act (42 U.S.C. 1395w– 

15 28(f)(1)), as amended by section 164(a) of the Medicare 

16 Improvements for Patients and Providers Act of 2008 

17 (Public Law 110–275), is amended by striking ‘‘2011’’ 

18 and inserting ‘‘2014’’. 

19 (b) AUTHORITY TO APPLY FRAILTY ADJUSTMENT

20 UNDER PACE PAYMENT RULES.—Section 1853(a)(1)(B) 

21 of the Social Security Act (42 U.S.C. 1395w–23(a)(1)(B)) 

22 is amended by adding at the end the following new clause: 

23 ‘‘(iv) AUTHORITY TO APPLY FRAILTY

24 ADJUSTMENT UNDER PACE PAYMENT

25 RULES FOR CERTAIN SPECIALIZED MA


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1 PLANS FOR SPECIAL NEEDS INDIVID2 UALS.— 

3 ‘‘(I) IN GENERAL.—Notwith4 standing the preceding provisions of 

5 this paragraph, for plan year 2011 

6 and subsequent plan years, in the case 

7 of a plan described in subclause (II), 

8 the Secretary may apply the payment 

9 rules under section 1894(d) (other 

10 than paragraph (3) of such section) 

11 rather than the payment rules that 

12 would otherwise apply under this part, 

13 but only to the extent necessary to re14 flect the costs of treating high con15 centrations of frail individuals. 

16 ‘‘(II) PLAN DESCRIBED.—A plan 

17 described in this subclause is a spe18 cialized MA plan for special needs in19 dividuals described in section 

20 1859(b)(6)(B)(ii) that is fully inte21 grated with capitated contracts with 

22 States for Medicaid benefits, including 

23 long-term care, and that have similar 

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1 mined by the Secretary) as the PACE 

2 program.’’. 

3 (c) TRANSITION AND EXCEPTION REGARDING RE4 STRICTION ON ENROLLMENT.—Section 1859(f) of the So5 cial Security Act (42 U.S.C. 1395w–28(f)) is amended by 

6 adding at the end the following new paragraph: 

7 ‘‘(6) TRANSITION AND EXCEPTION REGARDING

8 RESTRICTION ON ENROLLMENT.— 

9 ‘‘(A) IN GENERAL.—Subject to subpara10 graph (C), the Secretary shall establish proce11 dures for the transition of applicable individuals 

12 to— 

13 ‘‘(i) a Medicare Advantage plan that 

14 is not a specialized MA plan for special 

15 needs individuals (as defined in subsection 

16 (b)(6)); or 

17 ‘‘(ii) the original medicare fee-for18 service program under parts A and B. 

19 ‘‘(B) APPLICABLE INDIVIDUALS.—For pur20 poses of clause (i), the term ‘applicable indi21 vidual’ means an individual who— 

22 ‘‘(i) is enrolled under a specialized 

23 MA plan for special needs individuals (as 

24 defined in subsection (b)(6)); and 


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1 ‘‘(ii) is not within the 1 or more of 

2 the classes of special needs individuals to 

3 which enrollment under the plan is re4 stricted to. 

5 ‘‘(C) EXCEPTION.—The Secretary shall 

6 provide for an exception to the transition de7 scribed in subparagraph (A) for a limited pe8 riod of time for individuals enrolled under a 

9 specialized MA plan for special needs individ10 uals described in subsection (b)(6)(B)(ii) who 

11 are no longer eligible for medical assistance 

12 under title XIX. 

13 ‘‘(D) TIMELINE FOR INITIAL TRANSI14 TION.—The Secretary shall ensure that applica15 ble individuals enrolled in a specialized MA plan 

16 for special needs individuals (as defined in sub17 section (b)(6)) prior to January 1, 2010, are 

18 transitioned to a plan or the program described 

19 in subparagraph (A) by not later than January 

20 1, 2013.’’. 

21 (d) TEMPORARY EXTENSION OF AUTHORITY TO OP22 ERATE BUT NO SERVICE AREA EXPANSION FOR DUAL

23 SPECIAL NEEDS PLANS THAT DO NOT MEET CERTAIN

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1 lic Law 110–275) is amended by striking ‘‘December 31, 

2 2010’’ and inserting ‘‘December 31, 2012’’. 

3 (e) AUTHORITY TO REQUIRE SPECIAL NEEDS PLANS

4 BE NCQA APPROVED.—Section 1859(f) of the Social Se5 curity Act (42 U.S.C. 1395w–28(f)), as amended by sub6 sections (a) and (c), is amended— 

7 (1) in paragraph (2), by adding at the end the 

8 following new subparagraph: 

9 ‘‘(C) If applicable, the plan meets the re10 quirement described in paragraph (7).’’; 

11 (2) in paragraph (3), by adding at the end the 

12 following new subparagraph: 

13 ‘‘(E) If applicable, the plan meets the re14 quirement described in paragraph (7).’’; 

15 (3) in paragraph (4), by adding at the end the 

16 following new subparagraph: 

17 ‘‘(C) If applicable, the plan meets the re18 quirement described in paragraph (7).’’; and 

19 (4) by adding at the end the following new 

20 paragraph: 

21 ‘‘(7) AUTHORITY TO REQUIRE SPECIAL NEEDS

22 PLANS BE NCQA APPROVED.—For 2012 and subse23 quent years, the Secretary shall require that a Medi24 care Advantage organization offering a specialized 

25 MA plan for special needs individuals be approved 


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1 by the National Committee for Quality Assurance 

2 (based on standards established by the Secretary).’’. 

3 (f) RISK ADJUSTMENT.—Section 1853(a)(1)(C) of 

4 the Social Security Act (42 U.S.C. 1395i–23(a)(1)(C)) is 

5 amended by adding at the end the following new clause: 

6 ‘‘(iii) IMPROVEMENTS TO RISK AD7 JUSTMENT FOR SPECIAL NEEDS INDIVID8 UALS WITH CHRONIC HEALTH CONDI9 TIONS.— 

10 ‘‘(I) IN GENERAL.—For 2011 

11 and subsequent years, for purposes of 

12 the adjustment under clause (i) with 

13 respect to individuals described in 

14 subclause (II), the Secretary shall use 

15 a risk score that reflects the known 

16 underlying risk profile and chronic 

17 health status of similar individuals. 

18 Such risk score shall be used instead 

19 of the default risk score for new en20 rollees in Medicare Advantage plans 

21 that are not specialized MA plans for 

22 special needs individuals (as defined 

23 in section 1859(b)(6)). 

24 ‘‘(II) INDIVIDUALS DE25 SCRIBED.—An individual described in 


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1 this subclause is a special needs indi2 vidual described in subsection 

3 (b)(6)(B)(iii) who enrolls in a special4 ized MA plan for special needs indi5 viduals on or after January 1, 2011. 

6 ‘‘(III) EVALUATION.—For 2011 

7 and periodically thereafter, the Sec8 retary shall evaluate and revise the 

9 risk adjustment system under this 

10 subparagraph in order to, as accu11 rately as possible, account for higher 

12 medical and care coordination costs 

13 associated with frailty, individuals 

14 with multiple, comorbid chronic condi15 tions, and individuals with a diagnosis 

16 of mental illness, and also to account 

17 for costs that may be associated with 

18 higher concentrations of beneficiaries 

19 with those conditions. 

20 ‘‘(IV) PUBLICATION OF EVALUA21 TION AND REVISIONS.—The Secretary 

22 shall publish, as part of an announce23 ment under subsection (b), a descrip24 tion of any evaluation conducted 

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1 ceding year and any revisions made 

2 under such subclause as a result of 

3 such evaluation.’’. 

4 (g) TECHNICAL CORRECTION.—Section 1859(f)(5) of 

5 the Social Security Act (42 U.S.C. 1395w–28(f)(5)) is 

6 amended, in the matter preceding subparagraph (A), by 

7 striking ‘‘described in subsection (b)(6)(B)(i)’’. 

8 SEC. 3206. EXTENSION OF REASONABLE COST CONTRACTS. 

9 Section 1876(h)(5)(C)(ii) of the Social Security Act 

10 (42 U.S.C. 1395mm(h)(5)(C)(ii)) is amended, in the mat11 ter preceding subclause (I), by striking ‘‘January 1, 2010’’ 

12 and inserting ‘‘January 1, 2013’’. 

13 SEC. 3207. TECHNICAL CORRECTION TO MA PRIVATE FEE14 FOR-SERVICE PLANS. 

15 For plan year 2011 and subsequent plan years, to 

16 the extent that the Secretary of Health and Human Serv17 ices is applying the 2008 service area extension waiver pol18 icy (as modified in the April 11, 2008, Centers for Medi19 care & Medicaid Services’ memorandum with the subject 

20 ‘‘2009 Employer Group Waiver-Modification of the 2008 

21 Service Area Extension Waiver Granted to Certain MA 

22 Local Coordinated Care Plans’’) to Medicare Advantage 

23 coordinated care plans, the Secretary shall extend the ap24 plication of such waiver policy to employers who contract 

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1 vate fee-for-service plan under section 1857(i)(2) of the 

2 Social Security Act (42 U.S.C. 1395w–27(i)(2)) and that 

3 had enrollment as of October 1, 2009. 

4 SEC. 3208. MAKING SENIOR HOUSING FACILITY DEM5 ONSTRATION PERMANENT. 

6 (a) IN GENERAL.—Section 1859 of the Social Secu7 rity Act (42 U.S.C. 1395w–28) is amended by adding at 

8 the end the following new subsection: 

9 ‘‘(g) SPECIAL RULES FOR SENIOR HOUSING FACIL10 ITY PLANS.— 

11 ‘‘(1) IN GENERAL.—In the case of a Medicare 

12 Advantage senior housing facility plan described in 

13 paragraph (2), notwithstanding any other provision 

14 of this part to the contrary and in accordance with 

15 regulations of the Secretary, the service area of such 

16 plan may be limited to a senior housing facility in 

17 a geographic area. 

18 ‘‘(2) MEDICARE ADVANTAGE SENIOR HOUSING

19 FACILITY PLAN DESCRIBED.—For purposes of this 

20 subsection, a Medicare Advantage senior housing fa21 cility plan is a Medicare Advantage plan that— 

22 ‘‘(A) restricts enrollment of individuals 

23 under this part to individuals who reside in a 

24 continuing care retirement community (as de25 fined in section 1852(l)(4)(B)); 


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1 ‘‘(B) provides primary care services onsite 

2 and has a ratio of accessible physicians to bene3 ficiaries that the Secretary determines is ade4 quate; 

5 ‘‘(C) provides transportation services for 

6 beneficiaries to specialty providers outside of 

7 the facility; and 

8 ‘‘(D) has participated (as of December 31, 

9 2009) in a demonstration project established by 

10 the Secretary under which such a plan was of11 fered for not less than 1 year.’’. 

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

13 this section shall take effect on January 1, 2010, and shall 

14 apply to plan years beginning on or after such date. 

15 SEC. 3209. AUTHORITY TO DENY PLAN BIDS. 

16 (a) IN GENERAL.—Section 1854(a)(5) of the Social 

17 Security Act (42 U.S.C. 1395w–24(a)(5)) is amended by 

18 adding at the end the following new subparagraph: 

19 ‘‘(C) REJECTION OF BIDS.— 

20 ‘‘(i) IN GENERAL.—Nothing in this 

21 section shall be construed as requiring the 

22 Secretary to accept any or every bid sub23 mitted by an MA organization under this 

24 subsection. 


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1 ‘‘(ii) AUTHORITY TO DENY BIDS THAT

2 PROPOSE SIGNIFICANT INCREASES IN COST

3 SHARING OR DECREASES IN BENEFITS.— 

4 The Secretary may deny a bid submitted 

5 by an MA organization for an MA plan if 

6 it proposes significant increases in cost 

7 sharing or decreases in benefits offered 

8 under the plan.’’. 

9 (b) APPLICATION UNDER PART D.—Section 1860D– 

10 11(d) of such Act (42 U.S.C. 1395w–111(d)) is amended 

11 by adding at the end the following new paragraph: 

12 ‘‘(3) REJECTION OF BIDS.—Paragraph (5)(C) 

13 of section 1854(a) shall apply with respect to bids 

14 submitted by a PDP sponsor under subsection (b) in 

15 the same manner as such paragraph applies to bids 

16 submitted by an MA organization under such section 

17 1854(a).’’. 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to bids submitted for contract 

20 years beginning on or after January 1, 2011. 

21 SEC. 3210. DEVELOPMENT OF NEW STANDARDS FOR CER22 TAIN MEDIGAP PLANS. 

23 (a) IN GENERAL.—Section 1882 of the Social Secu24 rity Act (42 U.S.C. 1395ss) is amended by adding at the 

25 end the following new subsection: 


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1 ‘‘(y) DEVELOPMENT OF NEW STANDARDS FOR CER2 TAIN MEDICARE SUPPLEMENTAL POLICIES.— 

3 ‘‘(1) IN GENERAL.—The Secretary shall request 

4 the National Association of Insurance Commis5 sioners to review and revise the standards for benefit 

6 packages described in paragraph (2) under sub7 section (p)(1), to otherwise update standards to in8 clude requirements for nominal cost sharing to en9 courage the use of appropriate physicians’ services 

10 under part B. Such revisions shall be based on evi11 dence published in peer-reviewed journals or current 

12 examples used by integrated delivery systems and 

13 made consistent with the rules applicable under sub14 section (p)(1)(E) with the reference to the ‘1991 

15 NAIC Model Regulation’ deemed a reference to the 

16 NAIC Model Regulation as published in the Federal 

17 Register on December 4, 1998, and as subsequently 

18 updated by the National Association of Insurance 

19 Commissioners to reflect previous changes in law 

20 and the reference to ‘date of enactment of this sub21 section’ deemed a reference to the date of enactment 

22 of the Patient Protection and Affordable Care Act. 

23 To the extent practicable, such revision shall provide 

24 for the implementation of revised standards for ben25 efit packages as of January 1, 2015. 


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1 ‘‘(2) BENEFIT PACKAGES DESCRIBED.—The 

2 benefit packages described in this paragraph are 

3 benefit packages classified as ‘C’ and ‘F’.’’. 

4 (b) CONFORMING AMENDMENT.—Section 1882(o)(1) 

5 of the Social Security Act (42 U.S.C. 1395ss(o)(1)) is 

6 amended by striking ‘‘, and (w)’’ and inserting ‘‘(w), and 

7 (y)’’. 

8 Subtitle D—Medicare Part D Im9 provements for Prescription 

10 Drug Plans and MA–PD Plans 

11 SEC. 3301. MEDICARE COVERAGE GAP DISCOUNT PRO12 GRAM. 

13 (a) CONDITION FOR COVERAGE OF DRUGS UNDER

14 PART D.—Part D of Title XVIII of the Social Security 

15 Act (42 U.S.C. 1395w–101 et seq.), is amended by adding 

16 at the end the following new section: 

17 ‘‘CONDITION FOR COVERAGE OF DRUGS UNDER THIS

18 PART

19 ‘‘SEC. 1860D–43. (a) IN GENERAL.—In order for 

20 coverage to be available under this part for covered part 

21 D drugs (as defined in section 1860D–2(e)) of a manufac22 turer, the manufacturer must— 

23 ‘‘(1) participate in the Medicare coverage gap 

24 discount program under section 1860D–14A; 


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1 ‘‘(2) have entered into and have in effect an 

2 agreement described in subsection (b) of such sec3 tion with the Secretary; and 

4 ‘‘(3) have entered into and have in effect, under 

5 terms and conditions specified by the Secretary, a 

6 contract with a third party that the Secretary has 

7 entered into a contract with under subsection (d)(3) 

8 of such section. 

9 ‘‘(b) EFFECTIVE DATE.—Subsection (a) shall apply 

10 to covered part D drugs dispensed under this part on or 

11 after July 1, 2010. 

12 ‘‘(c) AUTHORIZING COVERAGE FOR DRUGS NOT COV13 ERED UNDER AGREEMENTS.—Subsection (a) shall not 

14 apply to the dispensing of a covered part D drug if— 

15 ‘‘(1) the Secretary has made a determination 

16 that the availability of the drug is essential to the 

17 health of beneficiaries under this part; or 

18 ‘‘(2) the Secretary determines that in the period 

19 beginning on July 1, 2010, and ending on December 

20 31, 2010, there were extenuating circumstances. 

21 ‘‘(d) DEFINITION OF MANUFACTURER.—In this sec22 tion, the term ‘manufacturer’ has the meaning given such 

23 term in section 1860D–14A(g)(5).’’. 

24 (b) MEDICARE COVERAGE GAP DISCOUNT PRO25 GRAM.—Part D of title XVIII of the Social Security Act 


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1 (42 U.S.C. 1395w–101) is amended by inserting after sec2 tion 1860D–14 the following new section: 

3 ‘‘MEDICARE COVERAGE GAP DISCOUNT PROGRAM

4 ‘‘SEC. 1860D–14A. (a) ESTABLISHMENT.—The Sec5 retary shall establish a Medicare coverage gap discount 

6 program (in this section referred to as the ‘program’) by 

7 not later than July 1, 2010. Under the program, the Sec8 retary shall enter into agreements described in subsection 

9 (b) with manufacturers and provide for the performance 

10 of the duties described in subsection (c)(1). The Secretary 

11 shall establish a model agreement for use under the pro12 gram by not later than April 1, 2010, in consultation with 

13 manufacturers, and allow for comment on such model 

14 agreement. 

15 ‘‘(b) TERMS OF AGREEMENT.— 

16 ‘‘(1) IN GENERAL.— 

17 ‘‘(A) AGREEMENT.—An agreement under 

18 this section shall require the manufacturer to 

19 provide applicable beneficiaries access to dis20 counted prices for applicable drugs of the man21 ufacturer. 

22 ‘‘(B) PROVISION OF DISCOUNTED PRICES

23 AT THE POINT-OF-SALE.—Except as provided in 

24 subsection (c)(1)(A)(iii), such discounted prices 

25 shall be provided to the applicable beneficiary at 


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1 the pharmacy or by the mail order service at 

2 the point-of-sale of an applicable drug. 

3 ‘‘(C) TIMING OF AGREEMENT.— 

4 ‘‘(i) SPECIAL RULE FOR 2010 AND

5 2011.—In order for an agreement with a 

6 manufacturer to be in effect under this 

7 section with respect to the period begin8 ning on July 1, 2010, and ending on De9 cember 31, 2011, the manufacturer shall 

10 enter into such agreement not later than 

11 May 1, 2010. 

12 ‘‘(ii) 2012 AND SUBSEQUENT

13 YEARS.—In order for an agreement with a 

14 manufacturer to be in effect under this 

15 section with respect to plan year 2012 or 

16 a subsequent plan year, the manufacturer 

17 shall enter into such agreement (or such 

18 agreement shall be renewed under para19 graph (4)(A)) not later than January 30 of 

20 the preceding year. 

21 ‘‘(2) PROVISION OF APPROPRIATE DATA.—Each 

22 manufacturer with an agreement in effect under this 

23 section shall collect and have available appropriate 

24 data, as determined by the Secretary, to ensure that 


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1 it can demonstrate to the Secretary compliance with 

2 the requirements under the program. 

3 ‘‘(3) COMPLIANCE WITH REQUIREMENTS FOR

4 ADMINISTRATION OF PROGRAM.—Each manufac5 turer with an agreement in effect under this section 

6 shall comply with requirements imposed by the Sec7 retary or a third party with a contract under sub8 section (d)(3), as applicable, for purposes of admin9 istering the program, including any determination 

10 under clause (i) of subsection (c)(1)(A) or proce11 dures established under such subsection (c)(1)(A). 

12 ‘‘(4) LENGTH OF AGREEMENT.— 

13 ‘‘(A) IN GENERAL.—An agreement under 

14 this section shall be effective for an initial pe15 riod of not less than 18 months and shall be 

16 automatically renewed for a period of not less 

17 than 1 year unless terminated under subpara18 graph (B). 

19 ‘‘(B) TERMINATION.— 

20 ‘‘(i) BY THE SECRETARY.—The Sec21 retary may provide for termination of an 

22 agreement under this section for a knowing 

23 and willful violation of the requirements of 

24 the agreement or other good cause shown. 

25 Such termination shall not be effective earVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00927 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 lier than 30 days after the date of notice 

2 to the manufacturer of such termination. 

3 The Secretary shall provide, upon request, 

4 a manufacturer with a hearing concerning 

5 such a termination, and such hearing shall 

6 take place prior to the effective date of the 

7 termination with sufficient time for such 

8 effective date to be repealed if the Sec9 retary determines appropriate. 

10 ‘‘(ii) BY A MANUFACTURER.—A man11 ufacturer may terminate an agreement 

12 under this section for any reason. Any 

13 such termination shall be effective, with re14 spect to a plan year— 

15 ‘‘(I) if the termination occurs be16 fore January 30 of a plan year, as of 

17 the day after the end of the plan year; 

18 and 

19 ‘‘(II) if the termination occurs on 

20 or after January 30 of a plan year, as 

21 of the day after the end of the suc22 ceeding plan year. 

23 ‘‘(iii) EFFECTIVENESS OF TERMI24 NATION.—Any termination under this sub25 paragraph shall not affect discounts for 


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1 applicable drugs of the manufacturer that 

2 are due under the agreement before the ef3 fective date of its termination. 

4 ‘‘(iv) NOTICE TO THIRD PARTY.—The 

5 Secretary shall provide notice of such ter6 mination to a third party with a contract 

7 under subsection (d)(3) within not less 

8 than 30 days before the effective date of 

9 such termination. 

10 ‘‘(c) DUTIES DESCRIBED AND SPECIAL RULE FOR

11 SUPPLEMENTAL BENEFITS.— 

12 ‘‘(1) DUTIES DESCRIBED.—The duties de13 scribed in this subsection are the following: 

14 ‘‘(A) ADMINISTRATION OF PROGRAM.—Ad15 ministering the program, including— 

16 ‘‘(i) the determination of the amount 

17 of the discounted price of an applicable 

18 drug of a manufacturer; 

19 ‘‘(ii) except as provided in clause (iii), 

20 the establishment of procedures under 

21 which discounted prices are provided to ap22 plicable beneficiaries at pharmacies or by 

23 mail order service at the point-of-sale of an 

24 applicable drug; 


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1 ‘‘(iii) in the case where, during the pe2 riod beginning on July 1, 2010, and end3 ing on December 31, 2011, it is not prac4 ticable to provide such discounted prices at 

5 the point-of-sale (as described in clause 

6 (ii)), the establishment of procedures to 

7 provide such discounted prices as soon as 

8 practicable after the point-of-sale; 

9 ‘‘(iv) the establishment of procedures 

10 to ensure that, not later than the applica11 ble number of calendar days after the dis12 pensing of an applicable drug by a phar13 macy or mail order service, the pharmacy 

14 or mail order service is reimbursed for an 

15 amount equal to the difference between— 

16 ‘‘(I) the negotiated price of the 

17 applicable drug; and 

18 ‘‘(II) the discounted price of the 

19 applicable drug; 

20 ‘‘(v) the establishment of procedures 

21 to ensure that the discounted price for an 

22 applicable drug under this section is ap23 plied before any coverage or financial as24 sistance under other health benefit plans 

25 or programs that provide coverage or fiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00930 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 nancial assistance for the purchase or pro2 vision of prescription drug coverage on be3 half of applicable beneficiaries as the Sec4 retary may specify; 

5 ‘‘(vi) the establishment of procedures 

6 to implement the special rule for supple7 mental benefits under paragraph (2); and 

8 ‘‘(vii) providing a reasonable dispute 

9 resolution mechanism to resolve disagree10 ments between manufacturers, applicable 

11 beneficiaries, and the third party with a 

12 contract under subsection (d)(3). 

13 ‘‘(B) MONITORING COMPLIANCE.— 

14 ‘‘(i) IN GENERAL.—The Secretary 

15 shall monitor compliance by a manufac16 turer with the terms of an agreement 

17 under this section. 

18 ‘‘(ii) NOTIFICATION.—If a third party 

19 with a contract under subsection (d)(3) de20 termines that the manufacturer is not in 

21 compliance with such agreement, the third 

22 party shall notify the Secretary of such 

23 noncompliance for appropriate enforcement 

24 under subsection (e). 


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1 ‘‘(C) COLLECTION OF DATA FROM PRE2 SCRIPTION DRUG PLANS AND MA–PD PLANS.— 

3 The Secretary may collect appropriate data 

4 from prescription drug plans and MA–PD plans 

5 in a timeframe that allows for discounted prices 

6 to be provided for applicable drugs under this 

7 section. 

8 ‘‘(2) SPECIAL RULE FOR SUPPLEMENTAL BENE9 FITS.—For plan year 2010 and each subsequent 

10 plan year, in the case where an applicable bene11 ficiary has supplemental benefits with respect to ap12 plicable drugs under the prescription drug plan or 

13 MA–PD plan that the applicable beneficiary is en14 rolled in, the applicable beneficiary shall not be pro15 vided a discounted price for an applicable drug 

16 under this section until after such supplemental ben17 efits have been applied with respect to the applicable 

18 drug. 

19 ‘‘(d) ADMINISTRATION.— 

20 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

21 the Secretary shall provide for the implementation of 

22 this section, including the performance of the duties 

23 described in subsection (c)(1). 

24 ‘‘(2) LIMITATION.— 


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1 ‘‘(A) IN GENERAL.—Subject to subpara2 graph (B), in providing for such implementa3 tion, the Secretary shall not receive or dis4 tribute any funds of a manufacturer under the 

5 program. 

6 ‘‘(B) EXCEPTION.—The limitation under 

7 subparagraph (A) shall not apply to the Sec8 retary with respect to drugs dispensed during 

9 the period beginning on July 1, 2010, and end10 ing on December 31, 2010, but only if the Sec11 retary determines that the exception to such 

12 limitation under this subparagraph is necessary 

13 in order for the Secretary to begin implementa14 tion of this section and provide applicable bene15 ficiaries timely access to discounted prices dur16 ing such period. 

17 ‘‘(3) CONTRACT WITH THIRD PARTIES.—The 

18 Secretary shall enter into a contract with 1 or more 

19 third parties to administer the requirements estab20 lished by the Secretary in order to carry out this 

21 section. At a minimum, the contract with a third 

22 party under the preceding sentence shall require 

23 that the third party— 

24 ‘‘(A) receive and transmit information be25 tween the Secretary, manufacturers, and other 


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1 individuals or entities the Secretary determines 

2 appropriate; 

3 ‘‘(B) receive, distribute, or facilitate the 

4 distribution of funds of manufacturers to ap5 propriate individuals or entities in order to 

6 meet the obligations of manufacturers under 

7 agreements under this section; 

8 ‘‘(C) provide adequate and timely informa9 tion to manufacturers, consistent with the 

10 agreement with the manufacturer under this 

11 section, as necessary for the manufacturer to 

12 fulfill its obligations under this section; and 

13 ‘‘(D) permit manufacturers to conduct 

14 periodic audits, directly or through contracts, of 

15 the data and information used by the third 

16 party to determine discounts for applicable 

17 drugs of the manufacturer under the program. 

18 ‘‘(4) PERFORMANCE REQUIREMENTS.—The 

19 Secretary shall establish performance requirements 

20 for a third party with a contract under paragraph 

21 (3) and safeguards to protect the independence and 

22 integrity of the activities carried out by the third 

23 party under the program under this section. 


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1 ‘‘(5) IMPLEMENTATION.—The Secretary may 

2 implement the program under this section by pro3 gram instruction or otherwise. 

4 ‘‘(6) ADMINISTRATION.—Chapter 35 of title 44, 

5 United States Code, shall not apply to the program 

6 under this section. 

7 ‘‘(e) ENFORCEMENT.— 

8 ‘‘(1) AUDITS.—Each manufacturer with an 

9 agreement in effect under this section shall be sub10 ject to periodic audit by the Secretary. 

11 ‘‘(2) CIVIL MONEY PENALTY.— 

12 ‘‘(A) IN GENERAL.—The Secretary shall 

13 impose a civil money penalty on a manufacturer 

14 that fails to provide applicable beneficiaries dis15 counts for applicable drugs of the manufacturer 

16 in accordance with such agreement for each 

17 such failure in an amount the Secretary deter18 mines is commensurate with the sum of— 

19 ‘‘(i) the amount that the manufac20 turer would have paid with respect to such 

21 discounts under the agreement, which will 

22 then be used to pay the discounts which 

23 the manufacturer had failed to provide; 

24 and 

25 ‘‘(ii) 25 percent of such amount. 


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1 ‘‘(B) APPLICATION.—The provisions of 

2 section 1128A (other than subsections (a) and 

3 (b)) shall apply to a civil money penalty under 

4 this paragraph in the same manner as such 

5 provisions apply to a penalty or proceeding 

6 under section 1128A(a). 

7 ‘‘(f) CLARIFICATION REGARDING AVAILABILITY OF

8 OTHER COVERED PART D DRUGS.—Nothing in this sec9 tion shall prevent an applicable beneficiary from pur10 chasing a covered part D drug that is not an applicable 

11 drug (including a generic drug or a drug that is not on 

12 the formulary of the prescription drug plan or MA–PD 

13 plan that the applicable beneficiary is enrolled in). 

14 ‘‘(g) DEFINITIONS.—In this section: 

15 ‘‘(1) APPLICABLE BENEFICIARY.—The term 

16 ‘applicable beneficiary’ means an individual who, on 

17 the date of dispensing an applicable drug— 

18 ‘‘(A) is enrolled in a prescription drug plan 

19 or an MA–PD plan; 

20 ‘‘(B) is not enrolled in a qualified retiree 

21 prescription drug plan; 

22 ‘‘(C) is not entitled to an income-related 

23 subsidy under section 1860D–14(a); 

24 ‘‘(D) is not subject to a reduction in pre25 mium subsidy under section 1839(i); and 


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1 ‘‘(E) who— 

2 ‘‘(i) has reached or exceeded the ini3 tial coverage limit under section 1860D– 

4 2(b)(3) during the year; and 

5 ‘‘(ii) has not incurred costs for cov6 ered part D drugs in the year equal to the 

7 annual out-of-pocket threshold specified in 

8 section 1860D–2(b)(4)(B). 

9 ‘‘(2) APPLICABLE DRUG.—The term ‘applicable 

10 drug’ means, with respect to an applicable bene11 ficiary, a covered part D drug— 

12 ‘‘(A) approved under a new drug applica13 tion under section 505(b) of the Federal Food, 

14 Drug, and Cosmetic Act or, in the case of a bio15 logic product, licensed under section 351 of the 

16 Public Health Service Act (other than a product 

17 licensed under subsection (k) of such section 

18 351); and 

19 ‘‘(B)(i) if the PDP sponsor of the prescrip20 tion drug plan or the MA organization offering 

21 the MA–PD plan uses a formulary, which is on 

22 the formulary of the prescription drug plan or 

23 MA–PD plan that the applicable beneficiary is 

24 enrolled in; 


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1 ‘‘(ii) if the PDP sponsor of the prescrip2 tion drug plan or the MA organization offering 

3 the MA–PD plan does not use a formulary, for 

4 which benefits are available under the prescrip5 tion drug plan or MA–PD plan that the appli6 cable beneficiary is enrolled in; or 

7 ‘‘(iii) is provided through an exception or 

8 appeal. 

9 ‘‘(3) APPLICABLE NUMBER OF CALENDAR

10 DAYS.—The term ‘applicable number of calendar 

11 days’ means— 

12 ‘‘(A) with respect to claims for reimburse13 ment submitted electronically, 14 days; and 

14 ‘‘(B) with respect to claims for reimburse15 ment submitted otherwise, 30 days. 

16 ‘‘(4) DISCOUNTED PRICE.— 

17 ‘‘(A) IN GENERAL.—The term ‘discounted 

18 price’ means 50 percent of the negotiated price 

19 of the applicable drug of a manufacturer. 

20 ‘‘(B) CLARIFICATION.—Nothing in this 

21 section shall be construed as affecting the re22 sponsibility of an applicable beneficiary for pay23 ment of a dispensing fee for an applicable drug. 

24 ‘‘(C) SPECIAL CASE FOR CERTAIN

25 CLAIMS.—In the case where the entire amount 


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1 of the negotiated price of an individual claim 

2 for an applicable drug with respect to an appli3 cable beneficiary does not fall at or above the 

4 initial coverage limit under section 1860D5 2(b)(3) and below the annual out-of-pocket 

6 threshold specified in section 1860D-2(b)(4)(B) 

7 for the year, the manufacturer of the applicable 

8 drug shall provide the discounted price under 

9 this section on only the portion of the nego10 tiated price of the applicable drug that falls at 

11 or above such initial coverage limit and below 

12 such annual out-of-pocket threshold. 

13 ‘‘(5) MANUFACTURER.—The term ‘manufac14 turer’ means any entity which is engaged in the pro15 duction, preparation, propagation, compounding, 

16 conversion, or processing of prescription drug prod17 ucts, either directly or indirectly by extraction from 

18 substances of natural origin, or independently by 

19 means of chemical synthesis, or by a combination of 

20 extraction and chemical synthesis. Such term does 

21 not include a wholesale distributor of drugs or a re22 tail pharmacy licensed under State law. 

23 ‘‘(6) NEGOTIATED PRICE.—The term ‘nego24 tiated price’ has the meaning given such term in sec25 tion 423.100 of title 42, Code of Federal RegulaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00939 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tions (as in effect on the date of enactment of this 

2 section), except that such negotiated price shall not 

3 include any dispensing fee for the applicable drug. 

4 ‘‘(7) QUALIFIED RETIREE PRESCRIPTION DRUG

5 PLAN.—The term ‘qualified retiree prescription drug 

6 plan’ has the meaning given such term in section 

7 1860D–22(a)(2).’’. 

8 (c) INCLUSION IN INCURRED COSTS.— 

9 (1) IN GENERAL.—Section 1860D–2(b)(4) of 

10 the Social Security Act (42 U.S.C. 1395w– 

11 102(b)(4)) is amended— 

12 (A) in subparagraph (C), in the matter 

13 preceding clause (i), by striking ‘‘In applying’’ 

14 and inserting ‘‘Except as provided in subpara15 graph (E), in applying’’; and 

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

17 subparagraph: 

18 ‘‘(E) INCLUSION OF COSTS OF APPLICABLE

19 DRUGS UNDER MEDICARE COVERAGE GAP DIS20 COUNT PROGRAM.—In applying subparagraph 

21 (A), incurred costs shall include the negotiated 

22 price (as defined in paragraph (6) of section 

23 1860D–14A(g)) of an applicable drug (as de24 fined in paragraph (2) of such section) of a 

25 manufacturer that is furnished to an applicable 


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1 beneficiary (as defined in paragraph (1) of such 

2 section) under the Medicare coverage gap dis3 count program under section 1860D–14A, re4 gardless of whether part of such costs were paid 

5 by a manufacturer under such program.’’. 

6 (2) EFFECTIVE DATE.—The amendments made 

7 by this subsection shall apply to costs incurred on or 

8 after July 1, 2010. 

9 (d) CONFORMING AMENDMENT PERMITTING PRE10 SCRIPTION DRUG DISCOUNTS.— 

11 (1) IN GENERAL.—Section 1128B(b)(3) of the 

12 Social Security Act (42 U.S.C. 1320a–7b(b)(3)) is 

13 amended— 

14 (A) by striking ‘‘and’’ at the end of sub15 paragraph (G); 

16 (B) in the subparagraph (H) added by sec17 tion 237(d) of the Medicare Prescription Drug, 

18 Improvement, and Modernization Act of 2003 

19 (Public Law 108–173; 117 Stat. 2213)— 

20 (i) by moving such subparagraph 2 

21 ems to the left; and 

22 (ii) by striking the period at the end 

23 and inserting a semicolon; 

24 (C) in the subparagraph (H) added by sec25 tion 431(a) of such Act (117 Stat. 2287)— 


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1 (i) by redesignating such subpara2 graph as subparagraph (I); 

3 (ii) by moving such subparagraph 2 

4 ems to the left; and 

5 (iii) by striking the period at the end 

6 and inserting ‘‘; and’’; and 

7 (D) by adding at the end the following new 

8 subparagraph: 

9 ‘‘(J) a discount in the price of an applica10 ble drug (as defined in paragraph (2) of section 

11 1860D–14A(g)) of a manufacturer that is fur12 nished to an applicable beneficiary (as defined 

13 in paragraph (1) of such section) under the 

14 Medicare coverage gap discount program under 

15 section 1860D–14A.’’. 

16 (2) CONFORMING AMENDMENT TO DEFINITION

17 OF BEST PRICE UNDER MEDICAID.—Section 

18 1927(c)(1)(C)(i)(VI) of the Social Security Act (42 

19 U.S.C. 1396r–8(c)(1)(C)(i)(VI)) is amended by in20 serting ‘‘, or any discounts provided by manufactur21 ers under the Medicare coverage gap discount pro22 gram under section 1860D–14A’’ before the period 

23 at the end. 


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1 (3) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall apply to drugs dispensed on 

3 or after July 1, 2010. 

4 SEC. 3302. IMPROVEMENT IN DETERMINATION OF MEDI5 CARE PART D LOW-INCOME BENCHMARK 

6 PREMIUM. 

7 (a) IN GENERAL.—Section 1860D–14(b)(2)(B)(iii) 

8 of the Social Security Act (42 U.S.C. 1395w– 

9 114(b)(2)(B)(iii)) is amended by inserting ‘‘, determined 

10 without regard to any reduction in such premium as a re11 sult of any beneficiary rebate under section 1854(b)(1)(C) 

12 or bonus payment under section 1853(n)’’ before the pe13 riod at the end. 

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

15 subsection (a) shall apply to premiums for months begin16 ning on or after January 1, 2011. 

17 SEC. 3303. VOLUNTARY DE MINIMIS POLICY FOR SUBSIDY 

18 ELIGIBLE INDIVIDUALS UNDER PRESCRIP19 TION DRUG PLANS AND MA–PD PLANS. 

20 (a) IN GENERAL.—Section 1860D–14(a) of the So21 cial Security Act (42 U.S.C. 1395w–114(a)) is amended 

22 by adding at the end the following new paragraph: 

23 ‘‘(5) WAIVER OF DE MINIMIS PREMIUMS.—The 

24 Secretary shall, under procedures established by the 

25 Secretary, permit a prescription drug plan or an 


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1 MA–PD plan to waive the monthly beneficiary pre2 mium for a subsidy eligible individual if the amount 

3 of such premium is de minimis. If such premium is 

4 waived under the plan, the Secretary shall not reas5 sign subsidy eligible individuals enrolled in the plan 

6 to other plans based on the fact that the monthly 

7 beneficiary premium under the plan was greater 

8 than the low-income benchmark premium amount.’’. 

9 (b) AUTHORIZING THE SECRETARY TO AUTO-EN10 ROLL SUBSIDY ELIGIBLE INDIVIDUALS IN PLANS THAT

11 WAIVE DE MINIMIS PREMIUMS.—Section 1860D–1(b)(1) 

12 of the Social Security Act (42 U.S.C. 1395w–101(b)(1)) 

13 is amended— 

14 (1) in subparagraph (C), by inserting ‘‘except 

15 as provided in subparagraph (D),’’ after ‘‘shall in16 clude,’’ 

17 (2) by adding at the end the following new sub18 paragraph: 

19 ‘‘(D) SPECIAL RULE FOR PLANS THAT

20 WAIVE DE MINIMIS PREMIUMS.—The process 

21 established under subparagraph (A) may in22 clude, in the case of a part D eligible individual 

23 who is a subsidy eligible individual (as defined 

24 in section 1860D–14(a)(3)) who has failed to 

25 enroll in a prescription drug plan or an MA–PD 


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1 plan, for the enrollment in a prescription drug 

2 plan or MA–PD plan that has waived the 

3 monthly beneficiary premium for such subsidy 

4 eligible individual under section 1860D– 

5 14(a)(5). If there is more than one such plan 

6 available, the Secretary shall enroll such an in7 dividual under the preceding sentence on a ran8 dom basis among all such plans in the PDP re9 gion. Nothing in the previous sentence shall 

10 prevent such an individual from declining or 

11 changing such enrollment.’’. 

12 (c) EFFECTIVE DATE.—The amendments made by 

13 this subsection shall apply to premiums for months, and 

14 enrollments for plan years, beginning on or after January 

15 1, 2011. 

16 SEC. 3304. SPECIAL RULE FOR WIDOWS AND WIDOWERS RE17 GARDING ELIGIBILITY FOR LOW-INCOME AS18 SISTANCE. 

19 (a) IN GENERAL.—Section 1860D–14(a)(3)(B) of 

20 the Social Security Act (42 U.S.C. 1395w–114(a)(3)(B)) 

21 is amended by adding at the end the following new clause: 

22 ‘‘(vi) SPECIAL RULE FOR WIDOWS

23 AND WIDOWERS.—Notwithstanding the 

24 preceding provisions of this subparagraph, 

25 in the case of an individual whose spouse 


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1 dies during the effective period for a deter2 mination or redetermination that has been 

3 made under this subparagraph, such effec4 tive period shall be extended through the 

5 date that is 1 year after the date on which 

6 the determination or redetermination 

7 would (but for the application of this 

8 clause) otherwise cease to be effective.’’. 

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

10 subsection (a) shall take effect on January 1, 2011. 

11 SEC. 3305. IMPROVED INFORMATION FOR SUBSIDY ELIGI12 BLE INDIVIDUALS REASSIGNED TO PRE13 SCRIPTION DRUG PLANS AND MA–PD PLANS. 

14 Section 1860D–14 of the Social Security Act (42 

15 U.S.C. 1395w–114) is amended— 

16 (1) by redesignating subsection (d) as sub17 section (e); and 

18 (2) by inserting after subsection (c) the fol19 lowing new subsection: 

20 ‘‘(d) FACILITATION OF REASSIGNMENTS.—Beginning 

21 not later than January 1, 2011, the Secretary shall, in 

22 the case of a subsidy eligible individual who is enrolled 

23 in one prescription drug plan and is subsequently reas24 signed by the Secretary to a new prescription drug plan, 


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1 provide the individual, within 30 days of such reassign2 ment, with— 

3 ‘‘(1) information on formulary differences be4 tween the individual’s former plan and the plan to 

5 which the individual is reassigned with respect to the 

6 individual’s drug regimens; and 

7 ‘‘(2) a description of the individual’s right to 

8 request a coverage determination, exception, or re9 consideration under section 1860D–4(g), bring an 

10 appeal under section 1860D–4(h), or resolve a griev11 ance under section 1860D–4(f).’’. 

12 SEC. 3306. FUNDING OUTREACH AND ASSISTANCE FOR 

13 LOW-INCOME PROGRAMS. 

14 (a) ADDITIONAL FUNDING FOR STATE HEALTH IN15 SURANCE PROGRAMS.—Subsection (a)(1)(B) of section 

16 119 of the Medicare Improvements for Patients and Pro17 viders Act of 2008 (42 U.S.C. 1395b–3 note) is amended 

18 by striking ‘‘(42 U.S.C. 1395w–23(f))’’ and all that fol19 lows through the period at the end and inserting ‘‘(42 

20 U.S.C. 1395w–23(f)), to the Centers for Medicare & Med21 icaid Services Program Management Account— 

22 ‘‘(i) for fiscal year 2009, of 

23 $7,500,000; and 

24 ‘‘(ii) for the period of fiscal years 

25 2010 through 2012, of $15,000,000. 


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1 Amounts appropriated under this subparagraph 

2 shall remain available until expended.’’. 

3 (b) ADDITIONAL FUNDING FOR AREA AGENCIES ON

4 AGING.—Subsection (b)(1)(B) of such section 119 is 

5 amended by striking ‘‘(42 U.S.C. 1395w–23(f))’’ and all 

6 that follows through the period at the end and inserting 

7 ‘‘(42 U.S.C. 1395w–23(f)), to the Administration on 

8 Aging— 

9 ‘‘(i) for fiscal year 2009, of 

10 $7,500,000; and 

11 ‘‘(ii) for the period of fiscal years 

12 2010 through 2012, of $15,000,000. 

13 Amounts appropriated under this subparagraph 

14 shall remain available until expended.’’. 

15 (c) ADDITIONAL FUNDING FOR AGING AND DIS16 ABILITY RESOURCE CENTERS.—Subsection (c)(1)(B) of 

17 such section 119 is amended by striking ‘‘(42 U.S.C. 

18 1395w–23(f))’’ and all that follows through the period at 

19 the end and inserting ‘‘(42 U.S.C. 1395w–23(f)), to the 

20 Administration on Aging— 

21 ‘‘(i) for fiscal year 2009, of 

22 $5,000,000; and 

23 ‘‘(ii) for the period of fiscal years 

24 2010 through 2012, of $10,000,000. 


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1 Amounts appropriated under this subparagraph 

2 shall remain available until expended.’’. 

3 (d) ADDITIONAL FUNDING FOR CONTRACT WITH

4 THE NATIONAL CENTER FOR BENEFITS AND OUTREACH

5 ENROLLMENT.—Subsection (d)(2) of such section 119 is 

6 amended by striking ‘‘(42 U.S.C. 1395w–23(f))’’ and all 

7 that follows through the period at the end and inserting 

8 ‘‘(42 U.S.C. 1395w–23(f)), to the Administration on 

9 Aging— 

10 ‘‘(i) for fiscal year 2009, of 

11 $5,000,000; and 

12 ‘‘(ii) for the period of fiscal years 

13 2010 through 2012, of $5,000,000. 

14 Amounts appropriated under this subparagraph 

15 shall remain available until expended.’’. 

16 (e) SECRETARIAL AUTHORITY TO ENLIST SUPPORT

17 IN CONDUCTING CERTAIN OUTREACH ACTIVITIES.—Such 

18 section 119 is amended by adding at the end the following 

19 new subsection: 

20 ‘‘(g) SECRETARIAL AUTHORITY TO ENLIST SUPPORT

21 IN CONDUCTING CERTAIN OUTREACH ACTIVITIES.—The 

22 Secretary may request that an entity awarded a grant 

23 under this section support the conduct of outreach activi24 ties aimed at preventing disease and promoting wellness. 

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1 tity may use a grant awarded under this subsection to sup2 port the conduct of activities described in the preceding 

3 sentence.’’. 

4 SEC. 3307. IMPROVING FORMULARY REQUIREMENTS FOR 

5 PRESCRIPTION DRUG PLANS AND MA–PD 

6 PLANS WITH RESPECT TO CERTAIN CAT7 EGORIES OR CLASSES OF DRUGS. 

8 (a) IMPROVING FORMULARY REQUIREMENTS.—Sec9 tion 1860D–4(b)(3)(G) of the Social Security Act is 

10 amended to read as follows: 

11 ‘‘(G) REQUIRED INCLUSION OF DRUGS IN

12 CERTAIN CATEGORIES AND CLASSES.— 

13 ‘‘(i) FORMULARY REQUIREMENTS.— 

14 ‘‘(I) IN GENERAL.—Subject to 

15 subclause (II), a PDP sponsor offer16 ing a prescription drug plan shall be 

17 required to include all covered part D 

18 drugs in the categories and classes 

19 identified by the Secretary under 

20 clause (ii)(I). 

21 ‘‘(II) EXCEPTIONS.—The Sec22 retary may establish exceptions that 

23 permit a PDP sponsor offering a pre24 scription drug plan to exclude from its 

25 formulary a particular covered part D 


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1 drug in a category or class that is 

2 otherwise required to be included in 

3 the formulary under subclause (I) (or 

4 to otherwise limit access to such a 

5 drug, including through prior author6 ization or utilization management). 

7 ‘‘(ii) IDENTIFICATION OF DRUGS IN

8 CERTAIN CATEGORIES AND CLASSES.— 

9 ‘‘(I) IN GENERAL.—Subject to 

10 clause (iv), the Secretary shall iden11 tify, as appropriate, categories and 

12 classes of drugs for which the Sec13 retary determines are of clinical con14 cern. 

15 ‘‘(II) CRITERIA.—The Secretary 

16 shall use criteria established by the 

17 Secretary in making any determina18 tion under subclause (I). 

19 ‘‘(iii) IMPLEMENTATION.—The Sec20 retary shall establish the criteria under 

21 clause (ii)(II) and any exceptions under 

22 clause (i)(II) through the promulgation of 

23 a regulation which includes a public notice 

24 and comment period. 


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1 ‘‘(iv) REQUIREMENT FOR CERTAIN

2 CATEGORIES AND CLASSES UNTIL CRI3 TERIA ESTABLISHED.—Until such time as 

4 the Secretary establishes the criteria under 

5 clause (ii)(II) the following categories and 

6 classes of drugs shall be identified under 

7 clause (ii)(I): 

8 ‘‘(I) Anticonvulsants. 

9 ‘‘(II) Antidepressants. 

10 ‘‘(III) Antineoplastics. 

11 ‘‘(IV) Antipsychotics. 

12 ‘‘(V) Antiretrovirals. 

13 ‘‘(VI) Immunosuppressants for 

14 the treatment of transplant rejec15 tion.’’. 

16 (b) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply to plan year 2011 and subsequent 

18 plan years. 

19 SEC. 3308. REDUCING PART D PREMIUM SUBSIDY FOR 

20 HIGH-INCOME BENEFICIARIES. 

21 (a) INCOME-RELATED INCREASE IN PART D PRE22 MIUM.— 

23 (1) IN GENERAL.—Section 1860D–13(a) of the 

24 Social Security Act (42 U.S.C. 1395w–113(a)) is 


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1 amended by adding at the end the following new 

2 paragraph: 

3 ‘‘(7) INCREASE IN BASE BENEFICIARY PREMIUM

4 BASED ON INCOME.— 

5 ‘‘(A) IN GENERAL.—In the case of an indi6 vidual whose modified adjusted gross income 

7 exceeds the threshold amount applicable under 

8 paragraph (2) of section 1839(i) (including ap9 plication of paragraph (5) of such section) for 

10 the calendar year, the monthly amount of the 

11 beneficiary premium applicable under this sec12 tion for a month after December 2010 shall be 

13 increased by the monthly adjustment amount 

14 specified in subparagraph (B). 

15 ‘‘(B) MONTHLY ADJUSTMENT AMOUNT.— 

16 The monthly adjustment amount specified in 

17 this subparagraph for an individual for a month 

18 in a year is equal to the product of— 

19 ‘‘(i) the quotient obtained by divid20 ing— 

21 ‘‘(I) the applicable percentage de22 termined under paragraph (3)(C) of 

23 section 1839(i) (including application 

24 of paragraph (5) of such section) for 


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1 the individual for the calendar year 

2 reduced by 25.5 percent; by 

3 ‘‘(II) 25.5 percent; and 

4 ‘‘(ii) the base beneficiary premium (as 

5 computed under paragraph (2)). 

6 ‘‘(C) MODIFIED ADJUSTED GROSS IN7 COME.—For purposes of this paragraph, the 

8 term ‘modified adjusted gross income’ has the 

9 meaning given such term in subparagraph (A) 

10 of section 1839(i)(4), determined for the tax11 able year applicable under subparagraphs (B) 

12 and (C) of such section. 

13 ‘‘(D) DETERMINATION BY COMMISSIONER

14 OF SOCIAL SECURITY.—The Commissioner of 

15 Social Security shall make any determination 

16 necessary to carry out the income-related in17 crease in the base beneficiary premium under 

18 this paragraph. 

19 ‘‘(E) PROCEDURES TO ASSURE CORRECT

20 INCOME-RELATED INCREASE IN BASE BENE21 FICIARY PREMIUM.— 

22 ‘‘(i) DISCLOSURE OF BASE BENE23 FICIARY PREMIUM.—Not later than Sep24 tember 15 of each year beginning with 

25 2010, the Secretary shall disclose to the 


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1 Commissioner of Social Security the 

2 amount of the base beneficiary premium 

3 (as computed under paragraph (2)) for the 

4 purpose of carrying out the income-related 

5 increase in the base beneficiary premium 

6 under this paragraph with respect to the 

7 following year. 

8 ‘‘(ii) ADDITIONAL DISCLOSURE.—Not 

9 later than October 15 of each year begin10 ning with 2010, the Secretary shall dis11 close to the Commissioner of Social Secu12 rity the following information for the pur13 pose of carrying out the income-related in14 crease in the base beneficiary premium 

15 under this paragraph with respect to the 

16 following year: 

17 ‘‘(I) The modified adjusted gross 

18 income threshold applicable under 

19 paragraph (2) of section 1839(i) (in20 cluding application of paragraph (5) 

21 of such section). 

22 ‘‘(II) The applicable percentage 

23 determined under paragraph (3)(C) of 

24 section 1839(i) (including application 

25 of paragraph (5) of such section). 


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1 ‘‘(III) The monthly adjustment 

2 amount specified in subparagraph 

3 (B). 

4 ‘‘(IV) Any other information the 

5 Commissioner of Social Security de6 termines necessary to carry out the 

7 income-related increase in the base 

8 beneficiary premium under this para9 graph. 

10 ‘‘(F) RULE OF CONSTRUCTION.—The for11 mula used to determine the monthly adjustment 

12 amount specified under subparagraph (B) shall 

13 only be used for the purpose of determining 

14 such monthly adjustment amount under such 

15 subparagraph.’’. 

16 (2) COLLECTION OF MONTHLY ADJUSTMENT

17 AMOUNT.—Section 1860D–13(c) of the Social Secu18 rity Act (42 U.S.C. 1395w–113(c)) is amended— 

19 (A) in paragraph (1), by striking ‘‘(2) and 

20 (3)’’ and inserting ‘‘(2), (3), and (4)’’; and 

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

22 paragraph: 

23 ‘‘(4) COLLECTION OF MONTHLY ADJUSTMENT

24 AMOUNT.— 


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1 ‘‘(A) IN GENERAL.—Notwithstanding any 

2 provision of this subsection or section 

3 1854(d)(2), subject to subparagraph (B), the 

4 amount of the income-related increase in the 

5 base beneficiary premium for an individual for 

6 a month (as determined under subsection 

7 (a)(7)) shall be paid through withholding from 

8 benefit payments in the manner provided under 

9 section 1840. 

10 ‘‘(B) AGREEMENTS.—In the case where 

11 the monthly benefit payments of an individual 

12 that are withheld under subparagraph (A) are 

13 insufficient to pay the amount described in such 

14 subparagraph, the Commissioner of Social Se15 curity shall enter into agreements with the Sec16 retary, the Director of the Office of Personnel 

17 Management, and the Railroad Retirement 

18 Board as necessary in order to allow other 

19 agencies to collect the amount described in sub20 paragraph (A) that was not withheld under 

21 such subparagraph.’’. 

22 (b) CONFORMING AMENDMENTS.— 

23 (1) MEDICARE.—Section 1860D–13(a)(1) of 

24 the Social Security Act (42 U.S.C. 1395w– 

25 113(a)(1)) is amended— 


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1 (A) by redesignating subparagraph (F) as 

2 subparagraph (G); 

3 (B) in subparagraph (G), as redesignated 

4 by subparagraph (A), by striking ‘‘(D) and 

5 (E)’’ and inserting ‘‘(D), (E), and (F)’’; and 

6 (C) by inserting after subparagraph (E) 

7 the following new subparagraph: 

8 ‘‘(F) INCREASE BASED ON INCOME.—The 

9 monthly beneficiary premium shall be increased 

10 pursuant to paragraph (7).’’. 

11 (2) INTERNAL REVENUE CODE.—Section 

12 6103(l)(20) of the Internal Revenue Code of 1986 

13 (relating to disclosure of return information to carry 

14 out Medicare part B premium subsidy adjustment) 

15 is amended— 

16 (A) in the heading, by inserting ‘‘AND

17 PART D BASE BENEFICIARY PREMIUM IN18 CREASE’’ after ‘‘PART B PREMIUM SUBSIDY AD19 JUSTMENT’’; 

20 (B) in subparagraph (A)— 

21 (i) in the matter preceding clause (i), 

22 by inserting ‘‘or increase under section 

23 1860D–13(a)(7)’’ after ‘‘1839(i)’’; and 

24 (ii) in clause (vii), by inserting after 

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1 lowing: ‘‘or increase under section 1860D– 

2 13(a)(7) of such Act’’; and 

3 (C) in subparagraph (B)— 

4 (i) by striking ‘‘Return information’’ 

5 and inserting the following: 

6 ‘‘(i) IN GENERAL.—Return informa7 tion’’; 

8 (ii) by inserting ‘‘or increase under 

9 such section 1860D–13(a)(7)’’ before the 

10 period at the end; 

11 (iii) as amended by clause (i), by in12 serting ‘‘or for the purpose of resolving 

13 taxpayer appeals with respect to any such 

14 premium adjustment or increase’’ before 

15 the period at the end; and 

16 (iv) by adding at the end the following 

17 new clause: 

18 ‘‘(ii) DISCLOSURE TO OTHER AGEN19 CIES.—Officers, employees, and contrac20 tors of the Social Security Administration 

21 may disclose— 

22 ‘‘(I) the taxpayer identity infor23 mation and the amount of the pre24 mium subsidy adjustment or premium 

25 increase with respect to a taxpayer deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00959 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 scribed in subparagraph (A) to offi2 cers, employees, and contractors of 

3 the Centers for Medicare and Med4 icaid Services, to the extent that such 

5 disclosure is necessary for the collec6 tion of the premium subsidy amount 

7 or the increased premium amount, 

8 ‘‘(II) the taxpayer identity infor9 mation and the amount of the pre10 mium subsidy adjustment or the in11 creased premium amount with respect 

12 to a taxpayer described in subpara13 graph (A) to officers and employees of 

14 the Office of Personnel Management 

15 and the Railroad Retirement Board, 

16 to the extent that such disclosure is 

17 necessary for the collection of the pre18 mium subsidy amount or the in19 creased premium amount, 

20 ‘‘(III) return information with re21 spect to a taxpayer described in sub22 paragraph (A) to officers and employ23 ees of the Department of Health and 

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1 peals of such premium subsidy adjust2 ment or increased premium, and 

3 ‘‘(IV) return information with re4 spect to a taxpayer described in sub5 paragraph (A) to officers and employ6 ees of the Department of Justice for 

7 use in judicial proceedings to the ex8 tent necessary to carry out the pur9 poses described in clause (i).’’. 

10 SEC. 3309. ELIMINATION OF COST SHARING FOR CERTAIN 

11 DUAL ELIGIBLE INDIVIDUALS. 

12 Section 1860D–14(a)(1)(D)(i) of the Social Security 

13 Act (42 U.S.C. 1395w–114(a)(1)(D)(i)) is amended by in14 serting ‘‘or, effective on a date specified by the Secretary 

15 (but in no case earlier than January 1, 2012), who would 

16 be such an institutionalized individual or couple, if the 

17 full-benefit dual eligible individual were not receiving serv18 ices under a home and community-based waiver authorized 

19 for a State under section 1115 or subsection (c) or (d) 

20 of section 1915 or under a State plan amendment under 

21 subsection (i) of such section or services provided through 

22 enrollment in a medicaid managed care organization with 

23 a contract under section 1903(m) or under section 1932’’ 

24 after ‘‘1902(q)(1)(B))’’. 


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1 SEC. 3310. REDUCING WASTEFUL DISPENSING OF OUT2 PATIENT PRESCRIPTION DRUGS IN LONG3 TERM CARE FACILITIES UNDER PRESCRIP4 TION DRUG PLANS AND MA–PD PLANS. 

5 (a) IN GENERAL.—Section 1860D–4(c) of the Social 

6 Security Act (42 U.S.C. 1395w–104(c)) is amended by 

7 adding at the end the following new paragraph: 

8 ‘‘(3) REDUCING WASTEFUL DISPENSING OF

9 OUTPATIENT PRESCRIPTION DRUGS IN LONG-TERM

10 CARE FACILITIES.—The Secretary shall require PDP 

11 sponsors of prescription drug plans to utilize spe12 cific, uniform dispensing techniques, as determined 

13 by the Secretary, in consultation with relevant stake14 holders (including representatives of nursing facili15 ties, residents of nursing facilities, pharmacists, the 

16 pharmacy industry (including retail and long-term 

17 care pharmacy), prescription drug plans, MA–PD 

18 plans, and any other stakeholders the Secretary de19 termines appropriate), such as weekly, daily, or 

20 automated dose dispensing, when dispensing covered 

21 part D drugs to enrollees who reside in a long-term 

22 care facility in order to reduce waste associated with 

23 30-day fills.’’. 

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

25 subsection (a) shall apply to plan years beginning on or 

26 after January 1, 2012. 


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1 SEC. 3311. IMPROVED MEDICARE PRESCRIPTION DRUG 

2 PLAN AND MA–PD PLAN COMPLAINT SYSTEM. 

3 (a) IN GENERAL.—The Secretary shall develop and 

4 maintain a complaint system, that is widely known and 

5 easy to use, to collect and maintain information on MA– 

6 PD plan and prescription drug plan complaints that are 

7 received (including by telephone, letter, e-mail, or any 

8 other means) by the Secretary (including by a regional of9 fice of the Department of Health and Human Services, 

10 the Medicare Beneficiary Ombudsman, a subcontractor, a 

11 carrier, a fiscal intermediary, and a Medicare administra12 tive contractor under section 1874A of the Social Security 

13 Act (42 U.S.C. 1395kk)) through the date on which the 

14 complaint is resolved. The system shall be able to report 

15 and initiate appropriate interventions and monitoring 

16 based on substantial complaints and to guide quality im17 provement. 

18 (b) MODEL ELECTRONIC COMPLAINT FORM.—The 

19 Secretary shall develop a model electronic complaint form 

20 to be used for reporting plan complaints under the system. 

21 Such form shall be prominently displayed on the front 

22 page of the Medicare.gov Internet website and on the 

23 Internet website of the Medicare Beneficiary Ombudsman. 

24 (c) ANNUAL REPORTS BY THE SECRETARY.—The 

25 Secretary shall submit to Congress annual reports on the 

26 system. Such reports shall include an analysis of the numVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00963 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ber and types of complaints reported in the system, geo2 graphic variations in such complaints, the timeliness of 

3 agency or plan responses to such complaints, and the reso4 lution of such complaints. 

5 (d) DEFINITIONS.—In this section: 

6 (1) MA–PD PLAN.—The term ‘‘MA–PD plan’’ 

7 has the meaning given such term in section 1860D– 

8 41(a)(9) of such Act (42 U.S.C. 1395w–151(a)(9)). 

9 (2) PRESCRIPTION DRUG PLAN.—The term 

10 ‘‘prescription drug plan’’ has the meaning given 

11 such term in section 1860D–41(a)(14) of such Act 

12 (42 U.S.C. 1395w–151(a)(14)). 

13 (3) SECRETARY.—The term ‘‘Secretary’’ means 

14 the Secretary of Health and Human Services. 

15 (4) SYSTEM.—The term ‘‘system’’ means the 

16 plan complaint system developed and maintained 

17 under subsection (a). 

18 SEC. 3312. UNIFORM EXCEPTIONS AND APPEALS PROCESS 

19 FOR PRESCRIPTION DRUG PLANS AND MA–PD 

20 PLANS. 

21 (a) IN GENERAL.—Section 1860D–4(b)(3) of the So22 cial Security Act (42 U.S.C. 1395w–104(b)(3)) is amend23 ed by adding at the end the following new subparagraph: 

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1 standing any other provision of this part, each 

2 PDP sponsor of a prescription drug plan 

3 shall— 

4 ‘‘(i) use a single, uniform exceptions 

5 and appeals process (including, to the ex6 tent the Secretary determines feasible, a 

7 single, uniform model form for use under 

8 such process) with respect to the deter9 mination of prescription drug coverage for 

10 an enrollee under the plan; and 

11 ‘‘(ii) provide instant access to such 

12 process by enrollees through a toll-free 

13 telephone number and an Internet 

14 website.’’. 

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

16 subsection (a) shall apply to exceptions and appeals on 

17 or after January 1, 2012. 

18 SEC. 3313. OFFICE OF THE INSPECTOR GENERAL STUDIES 

19 AND REPORTS. 

20 (a) STUDY AND ANNUAL REPORT ON PART D 

21 FORMULARIES’ INCLUSION OF DRUGS COMMONLY USED

22 BY DUAL ELIGIBLES.— 

23 (1) STUDY.—The Inspector General of the De24 partment of Health and Human Services shall con25 duct a study of the extent to which formularies used 


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1 by prescription drug plans and MA–PD plans under 

2 part D include drugs commonly used by full-benefit 

3 dual eligible individuals (as defined in section 

4 1935(c)(6) of the Social Security Act (42 U.S.C. 

5 1396u–5(c)(6))). 

6 (2) ANNUAL REPORTS.—Not later than July 1 

7 of each year (beginning with 2011), the Inspector 

8 General shall submit to Congress a report on the 

9 study conducted under paragraph (1), together with 

10 such recommendations as the Inspector General de11 termines appropriate. 

12 (b) STUDY AND REPORT ON PRESCRIPTION DRUG

13 PRICES UNDER MEDICARE PART D AND MEDICAID.— 

14 (1) STUDY.— 

15 (A) IN GENERAL.—The Inspector General 

16 of the Department of Health and Human Serv17 ices shall conduct a study on prices for covered 

18 part D drugs under the Medicare prescription 

19 drug program under part D of title XVIII of 

20 the Social Security Act and for covered out21 patient drugs under title XIX. Such study shall 

22 include the following: 

23 (i) A comparison, with respect to the 

24 200 most frequently dispensed covered 

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1 ered outpatient drugs under such title (as 

2 determined by the Inspector General based 

3 on volume and expenditures), of— 

4 (I) the prices paid for covered 

5 part D drugs by PDP sponsors of 

6 prescription drug plans and Medicare 

7 Advantage organizations offering MA– 

8 PD plans; and 

9 (II) the prices paid for covered 

10 outpatient drugs by a State plan 

11 under title XIX. 

12 (ii) An assessment of— 

13 (I) the financial impact of any 

14 discrepancies in such prices on the 

15 Federal Government; and 

16 (II) the financial impact of any 

17 such discrepancies on enrollees under 

18 part D or individuals eligible for med19 ical assistance under a State plan 

20 under title XIX. 

21 (B) PRICE.—For purposes of subpara22 graph (A), the price of a covered part D drug 

23 or a covered outpatient drug shall include any 

24 rebate or discount under such program or such 

25 title, respectively, including any negotiated price 


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1 concession described in section 1860D– 

2 2(d)(1)(B) of the Social Security Act (42 

3 U.S.C. 1395w–102(d)(1)(B)) or rebate under 

4 an agreement under section 1927 of the Social 

5 Security Act (42 U.S.C. 1396r–8). 

6 (C) AUTHORITY TO COLLECT ANY NEC7 ESSARY INFORMATION.—Notwithstanding any 

8 other provision of law, the Inspector General of 

9 the Department of Health and Human Services 

10 shall be able to collect any information related 

11 to the prices of covered part D drugs under 

12 such program and covered outpatient drugs 

13 under such title XIX necessary to carry out the 

14 comparison under subparagraph (A). 

15 (2) REPORT.— 

16 (A) IN GENERAL.—Not later than October 

17 1, 2011, subject to subparagraph (B), the In18 spector General shall submit to Congress a re19 port containing the results of the study con20 ducted under paragraph (1), together with rec21 ommendations for such legislation and adminis22 trative action as the Inspector General deter23 mines appropriate. 

24 (B) LIMITATION ON INFORMATION CON25 TAINED IN REPORT.—The report submitted 


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1 under subparagraph (A) shall not include any 

2 information that the Inspector General deter3 mines is proprietary or is likely to negatively 

4 impact the ability of a PDP sponsor or a State 

5 plan under title XIX to negotiate prices for cov6 ered part D drugs or covered outpatient drugs, 

7 respectively. 

8 (3) DEFINITIONS.—In this section: 

9 (A) COVERED PART D DRUG.—The term 

10 ‘‘covered part D drug’’ has the meaning given 

11 such term in section 1860D–2(e) of the Social 

12 Security Act (42 U.S.C. 1395w–102(e)). 

13 (B) COVERED OUTPATIENT DRUG.—The 

14 term ‘‘covered outpatient drug’’ has the mean15 ing given such term in section 1927(k) of such 

16 Act (42 U.S.C. 1396r(k)). 

17 (C) MA–PD PLAN.—The term ‘‘MA–PD 

18 plan’’ has the meaning given such term in sec19 tion 1860D–41(a)(9) of such Act (42 U.S.C. 

20 1395w–151(a)(9)). 

21 (D) MEDICARE ADVANTAGE ORGANIZA22 TION.—The term ‘‘Medicare Advantage organi23 zation’’ has the meaning given such term in 

24 section 1859(a)(1) of such Act (42 U.S.C. 

25 1395w–28)(a)(1)). 


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1 (E) PDP SPONSOR.—The term ‘‘PDP 

2 sponsor’’ has the meaning given such term in 

3 section 1860D–41(a)(13) of such Act (42 

4 U.S.C. 1395w–151(a)(13)). 

5 (F) PRESCRIPTION DRUG PLAN.—The 

6 term ‘‘prescription drug plan’’ has the meaning 

7 given such term in section 1860D–41(a)(14) of 

8 such Act (42 U.S.C. 1395w–151(a)(14)). 

9 SEC. 3314. INCLUDING COSTS INCURRED BY AIDS DRUG AS10 SISTANCE PROGRAMS AND INDIAN HEALTH 

11 SERVICE IN PROVIDING PRESCRIPTION 

12 DRUGS TOWARD THE ANNUAL OUT-OF-POCK13 ET THRESHOLD UNDER PART D. 

14 (a) IN GENERAL.—Section 1860D–2(b)(4)(C) of the 

15 Social Security Act (42 U.S.C. 1395w–102(b)(4)(C)) is 

16 amended— 

17 (1) in clause (i), by striking ‘‘and’’ at the end; 

18 (2) in clause (ii)— 

19 (A) by striking ‘‘such costs shall be treated 

20 as incurred only if’’ and inserting ‘‘subject to 

21 clause (iii), such costs shall be treated as in22 curred only if’’; 

23 (B) by striking ‘‘, under section 1860D– 

24 14, or under a State Pharmaceutical Assistance 

25 Program’’; and 


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1 (C) by striking the period at the end and 

2 inserting ‘‘; and’’; and 

3 (3) by inserting after clause (ii) the following 

4 new clause: 

5 ‘‘(iii) such costs shall be treated as in6 curred and shall not be considered to be 

7 reimbursed under clause (ii) if such costs 

8 are borne or paid— 

9 ‘‘(I) under section 1860D–14; 

10 ‘‘(II) under a State Pharma11 ceutical Assistance Program; 

12 ‘‘(III) by the Indian Health Serv13 ice, an Indian tribe or tribal organiza14 tion, or an urban Indian organization 

15 (as defined in section 4 of the Indian 

16 Health Care Improvement Act); or 

17 ‘‘(IV) under an AIDS Drug As18 sistance Program under part B of 

19 title XXVI of the Public Health Serv20 ice Act.’’. 

21 (b) EFFECTIVE DATE.—The amendments made by 

22 subsection (a) shall apply to costs incurred on or after 

23 January 1, 2011. 


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1 SEC. 3315. IMMEDIATE REDUCTION IN COVERAGE GAP IN 

2 2010. 

3 Section 1860D–2(b) of the Social Security Act (42 

4 U.S.C. 1395w–102(b)) is amended— 

5 (1) in paragraph (3)(A), by striking ‘‘paragraph 

6 (4)’’ and inserting ‘‘paragraphs (4) and (7)’’; and 

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

8 paragraph: 

9 ‘‘(7) INCREASE IN INITIAL COVERAGE LIMIT IN

10 2010.— 

11 ‘‘(A) IN GENERAL.—For the plan year be12 ginning on January 1, 2010, the initial cov13 erage limit described in paragraph (3)(B) other14 wise applicable shall be increased by $500. 

15 ‘‘(B) APPLICATION.—In applying subpara16 graph (A)— 

17 ‘‘(i) except as otherwise provided in 

18 this subparagraph, there shall be no 

19 change in the premiums, bids, or any other 

20 parameters under this part or part C; 

21 ‘‘(ii) costs that would be treated as in22 curred costs for purposes of applying para23 graph (4) but for the application of sub24 paragraph (A) shall continue to be treated 

25 as incurred costs; 


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1 ‘‘(iii) the Secretary shall establish pro2 cedures, which may include a reconciliation 

3 process, to fully reimburse PDP sponsors 

4 with respect to prescription drug plans and 

5 MA organizations with respect to MA–PD 

6 plans for the reduction in beneficiary cost 

7 sharing associated with the application of 

8 subparagraph (A); 

9 ‘‘(iv) the Secretary shall develop an 

10 estimate of the additional increased costs 

11 attributable to the application of this para12 graph for increased drug utilization and fi13 nancing and administrative costs and shall 

14 use such estimate to adjust payments to 

15 PDP sponsors with respect to prescription 

16 drug plans under this part and MA organi17 zations with respect to MA–PD plans 

18 under part C; and 

19 ‘‘(v) the Secretary shall establish pro20 cedures for retroactive reimbursement of 

21 part D eligible individuals who are covered 

22 under such a plan for costs which are in23 curred before the date of initial implemen24 tation of subparagraph (A) and which 

25 would be reimbursed under such a plan if 


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1 such implementation occurred as of Janu2 ary 1, 2010. 

3 ‘‘(C) NO EFFECT ON SUBSEQUENT

4 YEARS.—The increase under subparagraph (A) 

5 shall only apply with respect to the plan year 

6 beginning on January 1, 2010, and the initial 

7 coverage limit for plan years beginning on or 

8 after January 1, 2011, shall be determined as 

9 if subparagraph (A) had never applied.’’. 

10 Subtitle E—Ensuring Medicare 

11 Sustainability 

12 SEC. 3401. REVISION OF CERTAIN MARKET BASKET UP13 DATES AND INCORPORATION OF PRODUC14 TIVITY IMPROVEMENTS INTO MARKET BAS15 KET UPDATES THAT DO NOT ALREADY IN16 CORPORATE SUCH IMPROVEMENTS. 

17 (a) INPATIENT ACUTE HOSPITALS.—Section 

18 1886(b)(3)(B) of the Social Security Act (42 U.S.C. 

19 1395ww(b)(3)(B)), as amended by section 3001(a)(3), is 

20 further amended— 

21 (1) in clause (i)(XX), by striking ‘‘clause (viii)’’ 

22 and inserting ‘‘clauses (viii), (ix), (xi), and (xii)’’; 

23 (2) in the first sentence of clause (viii), by in24 serting ‘‘of such applicable percentage increase (deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00974 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 termined without regard to clause (ix), (xi), or 

2 (xii))’’ after ‘‘one-quarter’’; 

3 (3) in the first sentence of clause (ix)(I), by in4 serting ‘‘(determined without regard to clause (viii), 

5 (xi), or (xii))’’ after ‘‘clause (i)’’ the second time it 

6 appears; and 

7 (4) by adding at the end the following new 

8 clauses: 

9 ‘‘(xi)(I) For 2012 and each subsequent fiscal year, 

10 after determining the applicable percentage increase de11 scribed in clause (i) and after application of clauses (viii) 

12 and (ix), such percentage increase shall be reduced by the 

13 productivity adjustment described in subclause (II). 

14 ‘‘(II) The productivity adjustment described in this 

15 subclause, with respect to a percentage, factor, or update 

16 for a fiscal year, year, cost reporting period, or other an17 nual period, is a productivity adjustment equal to the 10- 

18 year moving average of changes in annual economy-wide 

19 private nonfarm business multi-factor productivity (as 

20 projected by the Secretary for the 10-year period ending 

21 with the applicable fiscal year, year, cost reporting period, 

22 or other annual period). 

23 ‘‘(III) The application of subclause (I) may result in 

24 the applicable percentage increase described in clause (i) 

25 being less than 0.0 for a fiscal year, and may result in 


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1 payment rates under this section for a fiscal year being 

2 less than such payment rates for the preceding fiscal year. 

3 ‘‘(xii) After determining the applicable percentage in4 crease described in clause (i), and after application of 

5 clauses (viii), (ix), and (xi), the Secretary shall reduce 

6 such applicable percentage increase— 

7 ‘‘(I) for each of fiscal years 2010 and 2011, by 

8 0.25 percentage point; and 

9 ‘‘(II) subject to clause (xiii), for each of fiscal 

10 years 2012 through 2019, by 0.2 percentage point. 

11 The application of this clause may result in the applicable 

12 percentage increase described in clause (i) being less than 

13 0.0 for a fiscal year, and may result in payment rates 

14 under this section for a fiscal year being less than such 

15 payment rates for the preceding fiscal year. 

16 ‘‘(xiii) Clause (xii) shall be applied with respect to 

17 any of fiscal years 2014 through 2019 by substituting ‘0.0 

18 percentage points’ for ‘0.2 percentage point’, if for such 

19 fiscal year— 

20 ‘‘(I) the excess (if any) of— 

21 ‘‘(aa) the total percentage of the non-elder22 ly insured population for the preceding fiscal 

23 year (based on the most recent estimates avail24 able from the Director of the Congressional 

25 Budget Office before a vote in either House on 


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1 the Patient Protection and Affordable Care Act 

2 that, if determined in the affirmative, would 

3 clear such Act for enrollment); over 

4 ‘‘(bb) the total percentage of the non-elder5 ly insured population for such preceding fiscal 

6 year (as estimated by the Secretary); exceeds 

7 ‘‘(II) 5 percentage points.’’. 

8 (b) SKILLED NURSING FACILITIES.—Section 

9 1888(e)(5)(B) of the Social Security Act (42 U.S.C. 

10 1395yy(e)(5)(B)) is amended— 

11 (1) by striking ‘‘PERCENTAGE.—The term’’ and 

12 inserting ‘‘PERCENTAGE.— 

13 ‘‘(i) IN GENERAL.—Subject to clause 

14 (ii), the term’’; and 

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

16 clause: 

17 ‘‘(ii) ADJUSTMENT.—For fiscal year 

18 2012 and each subsequent fiscal year, 

19 after determining the percentage described 

20 in clause (i), the Secretary shall reduce 

21 such percentage by the productivity adjust22 ment described in section 

23 1886(b)(3)(B)(xi)(II). The application of 

24 the preceding sentence may result in such 

25 percentage being less than 0.0 for a fiscal 


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1 year, and may result in payment rates 

2 under this subsection for a fiscal year 

3 being less than such payment rates for the 

4 preceding fiscal year.’’. 

5 (c) LONG-TERM CARE HOSPITALS.—Section 1886(m) 

6 of the Social Security Act (42 U.S.C. 1395ww(m)) is 

7 amended by adding at the end the following new para8 graphs: 

9 ‘‘(3) IMPLEMENTATION FOR RATE YEAR 2010

10 AND SUBSEQUENT YEARS.— 

11 ‘‘(A) IN GENERAL.—In implementing the 

12 system described in paragraph (1) for rate year 

13 2010 and each subsequent rate year, any an14 nual update to a standard Federal rate for dis15 charges for the hospital during the rate year, 

16 shall be reduced— 

17 ‘‘(i) for rate year 2012 and each sub18 sequent rate year, by the productivity ad19 justment described in section 

20 1886(b)(3)(B)(xi)(II); and 

21 ‘‘(ii) for each of rate years 2010 

22 through 2019, by the other adjustment de23 scribed in paragraph (4). 

24 ‘‘(B) SPECIAL RULE.—The application of 

25 this paragraph may result in such annual upVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00978 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 date being less than 0.0 for a rate year, and 

2 may result in payment rates under the system 

3 described in paragraph (1) for a rate year being 

4 less than such payment rates for the preceding 

5 rate year. 

6 ‘‘(4) OTHER ADJUSTMENT.— 

7 ‘‘(A) IN GENERAL.—For purposes of para8 graph (3)(A)(ii), the other adjustment described 

9 in this paragraph is— 

10 ‘‘(i) for each of rate years 2010 and 

11 2011, 0.25 percentage point; and 

12 ‘‘(ii) subject to subparagraph (B), for 

13 each of rate years 2012 through 2019, 0.2 

14 percentage point. 

15 ‘‘(B) REDUCTION OF OTHER ADJUST16 MENT.—Subparagraph (A)(ii) shall be applied 

17 with respect to any of rate years 2014 through 

18 2019 by substituting ‘0.0 percentage points’ for 

19 ‘0.2 percentage point’, if for such rate year— 

20 ‘‘(i) the excess (if any) of— 

21 ‘‘(I) the total percentage of the 

22 non-elderly insured population for the 

23 preceding rate year (based on the 

24 most recent estimates available from 

25 the Director of the Congressional 


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1 Budget Office before a vote in either 

2 House on the Patient Protection and 

3 Affordable Care Act that, if deter4 mined in the affirmative, would clear 

5 such Act for enrollment); over 

6 ‘‘(II) the total percentage of the 

7 non-elderly insured population for 

8 such preceding rate year (as estimated 

9 by the Secretary); exceeds 

10 ‘‘(ii) 5 percentage points.’’. 

11 (d) INPATIENT REHABILITATION FACILITIES.—Sec12 tion 1886(j)(3) of the Social Security Act (42 U.S.C. 

13 1395ww(j)(3)) is amended— 

14 (1) in subparagraph (C)— 

15 (A) by striking ‘‘FACTOR.—For purposes’’ 

16 and inserting ‘‘FACTOR.— 

17 ‘‘(i) IN GENERAL.—For purposes’’; 

18 (B) by inserting ‘‘subject to clause (ii)’’ be19 fore the period at the end of the first sentence 

20 of clause (i), as added by paragraph (1); and 

21 (C) by adding at the end the following new 

22 clause: 

23 ‘‘(ii) PRODUCTIVITY AND OTHER AD24 JUSTMENT.—After establishing the in25 crease factor described in clause (i) for a 


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1 fiscal year, the Secretary shall reduce such 

2 increase factor— 

3 ‘‘(I) for fiscal year 2012 and 

4 each subsequent fiscal year, by the 

5 productivity adjustment described in 

6 section 1886(b)(3)(B)(xi)(II); and 

7 ‘‘(II) for each of fiscal years 

8 2010 through 2019, by the other ad9 justment described in subparagraph 

10 (D). 

11 The application of this clause may result in 

12 the increase factor under this subpara13 graph being less than 0.0 for a fiscal year, 

14 and may result in payment rates under 

15 this subsection for a fiscal year being less 

16 than such payment rates for the preceding 

17 fiscal year.’’; and 

18 (2) by adding at the end the following new sub19 paragraph: 

20 ‘‘(D) OTHER ADJUSTMENT.— 

21 ‘‘(i) IN GENERAL.—For purposes of 

22 subparagraph (C)(ii)(II), the other adjust23 ment described in this subparagraph is— 

24 ‘‘(I) for each of fiscal years 2010 

25 and 2011, 0.25 percentage point; and 


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1 ‘‘(II) subject to clause (ii), for 

2 each of fiscal years 2012 through 

3 2019, 0.2 percentage point. 

4 ‘‘(ii) REDUCTION OF OTHER ADJUST5 MENT.—Clause (i)(II) shall be applied with 

6 respect to any of fiscal years 2014 through 

7 2019 by substituting ‘0.0 percentage 

8 points’ for ‘0.2 percentage point’, if for 

9 such fiscal year— 

10 ‘‘(I) the excess (if any) of— 

11 ‘‘(aa) the total percentage of 

12 the non-elderly insured popu13 lation for the preceding fiscal 

14 year (based on the most recent 

15 estimates available from the Di16 rector of the Congressional 

17 Budget Office before a vote in ei18 ther House on the Patient Pro19 tection and Affordable Care Act 

20 that, if determined in the affirm21 ative, would clear such Act for 

22 enrollment); over 

23 ‘‘(bb) the total percentage of 

24 the non-elderly insured popu25 lation for such preceding fiscal 


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1 year (as estimated by the Sec2 retary); exceeds 

3 ‘‘(II) 5 percentage points.’’. 

4 (e) HOME HEALTH AGENCIES.—Section 

5 1895(b)(3)(B) of the Social Security Act (42 U.S.C. 

6 1395fff(b)(3)(B)) is amended— 

7 (1) in clause (ii)(V), by striking ‘‘clause (v)’’ 

8 and inserting ‘‘clauses (v) and (vi)’’; and 

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

10 clause: 

11 ‘‘(vi) ADJUSTMENTS.—After deter12 mining the home health market basket per13 centage increase under clause (iii), and 

14 after application of clause (v), the Sec15 retary shall reduce such percentage— 

16 ‘‘(I) for 2015 and each subse17 quent year, by the productivity adjust18 ment described in section 

19 1886(b)(3)(B)(xi)(II); and 

20 ‘‘(II) for each of 2011 and 2012, 

21 by 1 percentage point. 

22 The application of this clause may result in 

23 the home health market basket percentage 

24 increase under clause (iii) being less than 

25 0.0 for a year, and may result in payment 


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1 rates under the system under this sub2 section for a year being less than such pay3 ment rates for the preceding year.’’. 

4 (f) PSYCHIATRIC HOSPITALS.—Section 1886 of the 

5 Social Security Act, as amended by sections 3001, 3008, 

6 3025, and 3133, is amended by adding at the end the fol7 lowing new subsection: 

8 ‘‘(s) PROSPECTIVE PAYMENT FOR PSYCHIATRIC

9 HOSPITALS.— 

10 ‘‘(1) REFERENCE TO ESTABLISHMENT AND IM11 PLEMENTATION OF SYSTEM.—For provisions related 

12 to the establishment and implementation of a pro13 spective payment system for payments under this 

14 title for inpatient hospital services furnished by psy15 chiatric hospitals (as described in clause (i) of sub16 section (d)(1)(B)) and psychiatric units (as de17 scribed in the matter following clause (v) of such 

18 subsection), see section 124 of the Medicare, Med19 icaid, and SCHIP Balanced Budget Refinement Act 

20 of 1999. 

21 ‘‘(2) IMPLEMENTATION FOR RATE YEAR BEGIN22 NING IN 2010 AND SUBSEQUENT RATE YEARS.— 

23 ‘‘(A) IN GENERAL.—In implementing the 

24 system described in paragraph (1) for the rate 

25 year beginning in 2010 and any subsequent 


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1 rate year, any update to a base rate for days 

2 during the rate year for a psychiatric hospital 

3 or unit, respectively, shall be reduced— 

4 ‘‘(i) for the rate year beginning in 

5 2012 and each subsequent rate year, by 

6 the productivity adjustment described in 

7 section 1886(b)(3)(B)(xi)(II); and 

8 ‘‘(ii) for each of the rate years begin9 ning in 2010 through 2019, by the other 

10 adjustment described in paragraph (3). 

11 ‘‘(B) SPECIAL RULE.—The application of 

12 this paragraph may result in such update being 

13 less than 0.0 for a rate year, and may result in 

14 payment rates under the system described in 

15 paragraph (1) for a rate year being less than 

16 such payment rates for the preceding rate year. 

17 ‘‘(3) OTHER ADJUSTMENT.— 

18 ‘‘(A) IN GENERAL.—For purposes of para19 graph (2)(A)(ii), the other adjustment described 

20 in this paragraph is— 

21 ‘‘(i) for each of the rate years begin22 ning in 2010 and 2011, 0.25 percentage 

23 point; and 


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1 ‘‘(ii) subject to subparagraph (B), for 

2 each of the rate years beginning in 2012 

3 through 2019, 0.2 percentage point. 

4 ‘‘(B) REDUCTION OF OTHER ADJUST5 MENT.—Subparagraph (A)(ii) shall be applied 

6 with respect to any of rate years 2014 through 

7 2019 by substituting ‘0.0 percentage points’ for 

8 ‘0.2 percentage point’, if for such rate year— 

9 ‘‘(i) the excess (if any) of— 

10 ‘‘(I) the total percentage of the 

11 non-elderly insured population for the 

12 preceding rate year (based on the 

13 most recent estimates available from 

14 the Director of the Congressional 

15 Budget Office before a vote in either 

16 House on the Patient Protection and 

17 Affordable Care Act that, if deter18 mined in the affirmative, would clear 

19 such Act for enrollment); over 

20 ‘‘(II) the total percentage of the 

21 non-elderly insured population for 

22 such preceding rate year (as estimated 

23 by the Secretary); exceeds 

24 ‘‘(ii) 5 percentage points.’’. 


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1 (g) HOSPICE CARE.—Section 1814(i)(1)(C) of the 

2 Social Security Act (42 U.S.C. 1395f(i)(1)(C)), as amend3 ed by section 3132, is amended by adding at the end the 

4 following new clauses: 

5 ‘‘(iv) After determining the market basket percentage 

6 increase under clause (ii)(VII) or (iii), as applicable, with 

7 respect to fiscal year 2013 and each subsequent fiscal 

8 year, the Secretary shall reduce such percentage— 

9 ‘‘(I) for 2013 and each subsequent fiscal year, 

10 by the productivity adjustment described in section 

11 1886(b)(3)(B)(xi)(II); and 

12 ‘‘(II) subject to clause (v), for each of fiscal 

13 years 2013 through 2019, by 0.5 percentage point. 

14 The application of this clause may result in the market 

15 basket percentage increase under clause (ii)(VII) or (iii), 

16 as applicable, being less than 0.0 for a fiscal year, and 

17 may result in payment rates under this subsection for a 

18 fiscal year being less than such payment rates for the pre19 ceding fiscal year. 

20 ‘‘(v) Clause (iv)(II) shall be applied with respect to 

21 any of fiscal years 2014 through 2019 by substituting ‘0.0 

22 percentage points’ for ‘0.5 percentage point’, if for such 

23 fiscal year— 

24 ‘‘(I) the excess (if any) of— 


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1 ‘‘(aa) the total percentage of the non-elder2 ly insured population for the preceding fiscal 

3 year (based on the most recent estimates avail4 able from the Director of the Congressional 

5 Budget Office before a vote in either House on 

6 the Patient Protection and Affordable Care Act 

7 that, if determined in the affirmative, would 

8 clear such Act for enrollment); over 

9 ‘‘(bb) the total percentage of the non-elder10 ly insured population for such preceding fiscal 

11 year (as estimated by the Secretary); exceeds 

12 ‘‘(II) 5 percentage points.’’. 

13 (h) DIALYSIS.—Section 1881(b)(14)(F) of the Social 

14 Security Act (42 U.S.C. 1395rr(b)(14)(F)) is amended— 

15 (1) in clause (i)— 

16 (A) by inserting ‘‘(I)’’ after ‘‘(F)(i)’’ 

17 (B) in subclause (I), as inserted by sub18 paragraph (A)— 

19 (i) by striking ‘‘clause (ii)’’ and in20 serting ‘‘subclause (II) and clause (ii)’’; 

21 and 

22 (ii) by striking ‘‘minus 1.0 percentage 

23 point’’; and 

24 (C) by adding at the end the following new 

25 subclause: 


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1 ‘‘(II) For 2012 and each subsequent year, after de2 termining the increase factor described in subclause (I), 

3 the Secretary shall reduce such increase factor by the pro4 ductivity adjustment described in section 

5 1886(b)(3)(B)(xi)(II). The application of the preceding 

6 sentence may result in such increase factor being less than 

7 0.0 for a year, and may result in payment rates under 

8 the payment system under this paragraph for a year being 

9 less than such payment rates for the preceding year.’’; and 

10 (2) in clause (ii)(II)— 

11 (A) by striking ‘‘The’’ and inserting ‘‘Sub12 ject to clause (i)(II), the’’; and 

13 (B) by striking ‘‘clause (i) minus 1.0 per14 centage point’’ and inserting ‘‘clause (i)(I)’’. 

15 (i) OUTPATIENT HOSPITALS.—Section 1833(t)(3) of 

16 the Social Security Act (42 U.S.C. 1395l(t)(3)) is amend17 ed— 

18 (1) in subparagraph (C)(iv), by inserting ‘‘and 

19 subparagraph (F) of this paragraph’’ after ‘‘(17)’’; 

20 and 

21 (2) by adding at the end the following new sub22 paragraphs: 

23 ‘‘(F) PRODUCTIVITY AND OTHER ADJUST24 MENT.—After determining the OPD fee sched25 ule increase factor under subparagraph (C)(iv), 


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1 the Secretary shall reduce such increase fac2 tor— 

3 ‘‘(i) for 2012 and subsequent years, 

4 by the productivity adjustment described in 

5 section 1886(b)(3)(B)(xi)(II); and 

6 ‘‘(ii) for each of 2010 through 2019, 

7 by the adjustment described in subpara8 graph (G). 

9 The application of this subparagraph may re10 sult in the increase factor under subparagraph 

11 (C)(iv) being less than 0.0 for a year, and may 

12 result in payment rates under the payment sys13 tem under this subsection for a year being less 

14 than such payment rates for the preceding year. 

15 ‘‘(G) OTHER ADJUSTMENT.— 

16 ‘‘(i) ADJUSTMENT.—For purposes of 

17 subparagraph (F)(ii), the adjustment de18 scribed in this subparagraph is— 

19 ‘‘(I) for each of 2010 and 2011, 

20 0.25 percentage point; and 

21 ‘‘(II) subject to clause (ii), for 

22 each of 2012 through 2019, 0.2 per23 centage point. 

24 ‘‘(ii) REDUCTION OF OTHER ADJUST25 MENT.—Clause (i)(II) shall be applied with 


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1 respect to any of 2014 through 2019 by 

2 substituting ‘0.0 percentage points’ for ‘0.2 

3 percentage point’, if for such year— 

4 ‘‘(I) the excess (if any) of— 

5 ‘‘(aa) the total percentage of 

6 the non-elderly insured popu7 lation for the preceding year 

8 (based on the most recent esti9 mates available from the Director 

10 of the Congressional Budget Of11 fice before a vote in either House 

12 on the Patient Protection and Af13 fordable Care Act that, if deter14 mined in the affirmative, would 

15 clear such Act for enrollment); 

16 over 

17 ‘‘(bb) the total percentage of 

18 the non-elderly insured popu19 lation for such preceding year (as 

20 estimated by the Secretary); ex21 ceeds 

22 ‘‘(II) 5 percentage points.’’. 

23 (j) AMBULANCE SERVICES.—Section 1834(l)(3) of 

24 the Social Security Act (42 U.S.C. 1395m(l)(3)) is amend25 ed— 


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1 (1) in subparagraph (A), by striking ‘‘and’’ at 

2 the end; 

3 (2) in subparagraph (B)— 

4 (A) by inserting ‘‘, subject to subpara5 graph (C) and the succeeding sentence of this 

6 paragraph,’’ after ‘‘increased’’; and 

7 (B) by striking the period at the end and 

8 inserting ‘‘; and’’; 

9 (3) by adding at the end the following new sub10 paragraph: 

11 ‘‘(C) for 2011 and each subsequent year, 

12 after determining the percentage increase under 

13 subparagraph (B) for the year, reduce such per14 centage increase by the productivity adjustment 

15 described in section 1886(b)(3)(B)(xi)(II).’’; 

16 and 

17 (4) by adding at the end the following flush 

18 sentence: 

19 ‘‘The application of subparagraph (C) may result in 

20 the percentage increase under subparagraph (B) 

21 being less than 0.0 for a year, and may result in 

22 payment rates under the fee schedule under this 

23 subsection for a year being less than such payment 

24 rates for the preceding year.’’. 


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1 (k) AMBULATORY SURGICAL CENTER SERVICES.— 

2 Section 1833(i)(2)(D) of the Social Security Act (42 

3 U.S.C. 1395l(i)(2)(D)) is amended— 

4 (1) by redesignating clause (v) as clause (vi); 

5 and 

6 (2) by inserting after clause (iv) the following 

7 new clause: 

8 ‘‘(v) In implementing the system de9 scribed in clause (i) for 2011 and each 

10 subsequent year, any annual update under 

11 such system for the year, after application 

12 of clause (iv), shall be reduced by the pro13 ductivity adjustment described in section 

14 1886(b)(3)(B)(xi)(II). The application of 

15 the preceding sentence may result in such 

16 update being less than 0.0 for a year, and 

17 may result in payment rates under the sys18 tem described in clause (i) for a year being 

19 less than such payment rates for the pre20 ceding year.’’. 

21 (l) LABORATORY SERVICES.—Section 1833(h)(2)(A) 

22 of the Social Security Act (42 U.S.C. 1395l(h)(2)(A)) is 

23 amended— 

24 (1) in clause (i)— 


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1 (A) by inserting ‘‘, subject to clause (iv),’’ 

2 after ‘‘year) by’’; and 

3 (B) by striking ‘‘through 2013’’ and in4 serting ‘‘and 2010’’; and 

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

6 clause: 

7 ‘‘(iv) After determining the adjust8 ment to the fee schedules under clause (i), 

9 the Secretary shall reduce such adjust10 ment— 

11 ‘‘(I) for 2011 and each subse12 quent year, by the productivity adjust13 ment described in section 

14 1886(b)(3)(B)(xi)(II); and 

15 ‘‘(II) for each of 2011 through 

16 2015, by 1.75 percentage points. 

17 Subclause (I) shall not apply in a year 

18 where the adjustment to the fee schedules 

19 determined under clause (i) is 0.0 or a per20 centage decrease for a year. The applica21 tion of the productivity adjustment under 

22 subclause (I) shall not result in an adjust23 ment to the fee schedules under clause (i) 

24 being less than 0.0 for a year. The applica25 tion of subclause (II) may result in an adVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 00994 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 justment to the fee schedules under clause 

2 (i) being less than 0.0 for a year, and may 

3 result in payment rates for a year being 

4 less than such payment rates for the pre5 ceding year.’’. 

6 (m) CERTAIN DURABLE MEDICAL EQUIPMENT.— 

7 Section 1834(a)(14) of the Social Security Act (42 U.S.C. 

8 1395m(a)(14)) is amended— 

9 (1) in subparagraph (K)— 

10 (A) by striking ‘‘2011, 2012, and 2013,’’; 

11 and 

12 (B) by inserting ‘‘and’’ after the semicolon 

13 at the end; 

14 (2) by striking subparagraphs (L) and (M) and 

15 inserting the following new subparagraph: 

16 ‘‘(L) for 2011 and each subsequent year— 

17 ‘‘(i) the percentage increase in the 

18 consumer price index for all urban con19 sumers (United States city average) for 

20 the 12-month period ending with June of 

21 the previous year, reduced by— 

22 ‘‘(ii) the productivity adjustment de23 scribed in section 1886(b)(3)(B)(xi)(II).’’; 

24 and 


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1 (3) by adding at the end the following flush 

2 sentence: 

3 ‘‘The application of subparagraph (L)(ii) may result 

4 in the covered item update under this paragraph 

5 being less than 0.0 for a year, and may result in 

6 payment rates under this subsection for a year being 

7 less than such payment rates for the preceding 

8 year.’’. 

9 (n) PROSTHETIC DEVICES, ORTHOTICS, AND PROS10 THETICS.—Section 1834(h)(4) of the Social Security Act 

11 (42 U.S.C. 1395m(h)(4)) is amended— 

12 (1) in subparagraph (A)— 

13 (A) in clause (ix), by striking ‘‘and’’ at the 

14 end; 

15 (B) in clause (x)— 

16 (i) by striking ‘‘a subsequent year’’ 

17 and inserting ‘‘for each of 2007 through 

18 2010’’; and 

19 (ii) by inserting ‘‘and’’ after the semi20 colon at the end; 

21 (C) by adding at the end the following new 

22 clause: 

23 ‘‘(xi) for 2011 and each subsequent 

24 year— 


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1 ‘‘(I) the percentage increase in 

2 the consumer price index for all urban 

3 consumers (United States city aver4 age) for the 12-month period ending 

5 with June of the previous year, re6 duced by— 

7 ‘‘(II) the productivity adjustment 

8 described in section 

9 1886(b)(3)(B)(xi)(II).’’; and 

10 (D) by adding at the end the following 

11 flush sentence: 

12 ‘‘The application of subparagraph (A)(xi)(II) may 

13 result in the applicable percentage increase under 

14 subparagraph (A) being less than 0.0 for a year, and 

15 may result in payment rates under this subsection 

16 for a year being less than such payment rates for 

17 the preceding year.’’. 

18 (o) OTHER ITEMS.—Section 1842(s)(1) of the Social 

19 Security Act (42 U.S.C. 1395u(s)(1)) is amended— 

20 (1) in the first sentence, by striking ‘‘Subject 

21 to’’ and inserting ‘‘(A) Subject to’’; 

22 (2) by striking the second sentence and insert23 ing the following new subparagraph: 


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1 ‘‘(B) Any fee schedule established under 

2 this paragraph for such item or service shall be 

3 updated— 

4 ‘‘(i) for years before 2011— 

5 ‘‘(I) subject to subclause (II), by 

6 the percentage increase in the con7 sumer price index for all urban con8 sumers (United States city average) 

9 for the 12-month period ending with 

10 June of the preceding year; and 

11 ‘‘(II) for items and services de12 scribed in paragraph (2)(D) for 2009, 

13 section 1834(a)(14)(J) shall apply 

14 under this paragraph instead of the 

15 percentage increase otherwise applica16 ble; and 

17 ‘‘(ii) for 2011 and subsequent years— 

18 ‘‘(I) the percentage increase in 

19 the consumer price index for all urban 

20 consumers (United States city aver21 age) for the 12-month period ending 

22 with June of the previous year, re23 duced by— 


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1 ‘‘(II) the productivity adjustment 

2 described in section 

3 1886(b)(3)(B)(xi)(II).’’; and 

4 (3) by adding at the end the following flush 

5 sentence: 

6 ‘‘The application of subparagraph (B)(ii)(II) may re7 sult in the update under this paragraph being less 

8 than 0.0 for a year, and may result in payment rates 

9 under any fee schedule established under this para10 graph for a year being less than such payment rates 

11 for the preceding year.’’. 

12 (p) NO APPLICATION PRIOR TO APRIL 1, 2010.— 

13 Notwithstanding the preceding provisions of this section, 

14 the amendments made by subsections (a), (c), and (d) 

15 shall not apply to discharges occurring before April 1, 

16 2010. 

17 SEC. 3402. TEMPORARY ADJUSTMENT TO THE CALCULA18 TION OF PART B PREMIUMS. 

19 Section 1839(i) of the Social Security Act (42 U.S.C. 

20 1395r(i)) is amended— 

21 (1) in paragraph (2), in the matter preceding 

22 subparagraph (A), by inserting ‘‘subject to para23 graph (6),’’ after ‘‘subsection,’’; 


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1 (2) in paragraph (3)(A)(i), by striking ‘‘The ap2 plicable’’ and inserting ‘‘Subject to paragraph (6), 

3 the applicable’’; 

4 (3) by redesignating paragraph (6) as para5 graph (7); and 

6 (4) by inserting after paragraph (5) the fol7 lowing new paragraph: 

8 ‘‘(6) TEMPORARY ADJUSTMENT TO INCOME

9 THRESHOLDS.—Notwithstanding any other provision 

10 of this subsection, during the period beginning on 

11 January 1, 2011, and ending on December 31, 

12 2019— 

13 ‘‘(A) the threshold amount otherwise appli14 cable under paragraph (2) shall be equal to 

15 such amount for 2010; and 

16 ‘‘(B) the dollar amounts otherwise applica17 ble under paragraph (3)(C)(i) shall be equal to 

18 such dollar amounts for 2010.’’. 

19 SEC. 3403. INDEPENDENT MEDICARE ADVISORY BOARD. 

20 (a) BOARD.— 

21 (1) IN GENERAL.—Title XVIII of the Social Se22 curity Act (42 U.S.C. 1395 et seq.), as amended by 

23 section 3022, is amended by adding at the end the 

24 following new section: 


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1 ‘‘INDEPENDENT MEDICARE ADVISORY BOARD

2 ‘‘SEC. 1899A. (a) ESTABLISHMENT.—There is estab3 lished an independent board to be known as the ‘Inde4 pendent Medicare Advisory Board’. 

5 ‘‘(b) PURPOSE.—It is the purpose of this section to, 

6 in accordance with the following provisions of this section, 

7 reduce the per capita rate of growth in Medicare spend8 ing— 

9 ‘‘(1) by requiring the Chief Actuary of the Cen10 ters for Medicare & Medicaid Services to determine 

11 in each year to which this section applies (in this 

12 section referred to as ‘a determination year’) the 

13 projected per capita growth rate under Medicare for 

14 the second year following the determination year (in 

15 this section referred to as ‘an implementation year’); 

16 ‘‘(2) if the projection for the implementation 

17 year exceeds the target growth rate for that year, by 

18 requiring the Board to develop and submit during 

19 the first year following the determination year (in 

20 this section referred to as ‘a proposal year’) a pro21 posal containing recommendations to reduce the 

22 Medicare per capita growth rate to the extent re23 quired by this section; and 


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1 ‘‘(3) by requiring the Secretary to implement 

2 such proposals unless Congress enacts legislation 

3 pursuant to this section. 

4 ‘‘(c) BOARD PROPOSALS.— 

5 ‘‘(1) DEVELOPMENT.— 

6 ‘‘(A) IN GENERAL.—The Board shall de7 velop detailed and specific proposals related to 

8 the Medicare program in accordance with the 

9 succeeding provisions of this section. 

10 ‘‘(B) ADVISORY REPORTS.—Beginning 

11 January 15, 2014, the Board may develop and 

12 submit to Congress advisory reports on matters 

13 related to the Medicare program, regardless of 

14 whether or not the Board submitted a proposal 

15 for such year. Such a report may, for years 

16 prior to 2020, include recommendations regard17 ing improvements to payment systems for pro18 viders of services and suppliers who are not oth19 erwise subject to the scope of the Board’s rec20 ommendations in a proposal under this section. 

21 Any advisory report submitted under this sub22 paragraph shall not be subject to the rules for 

23 congressional consideration under subsection 

24 (d). 

25 ‘‘(2) PROPOSALS.— 


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1 ‘‘(A) REQUIREMENTS.—Each proposal 

2 submitted under this section in a proposal year 

3 shall meet each of the following requirements: 

4 ‘‘(i) If the Chief Actuary of the Cen5 ters for Medicare & Medicaid Services has 

6 made a determination under paragraph 

7 (7)(A) in the determination year, the pro8 posal shall include recommendations so 

9 that the proposal as a whole (after taking 

10 into account recommendations under 

11 clause (v)) will result in a net reduction in 

12 total Medicare program spending in the 

13 implementation year that is at least equal 

14 to the applicable savings target established 

15 under paragraph (7)(B) for such imple16 mentation year. In determining whether a 

17 proposal meets the requirement of the pre18 ceding sentence, reductions in Medicare 

19 program spending during the 3-month pe20 riod immediately preceding the implemen21 tation year shall be counted to the extent 

22 that such reductions are a result of the im23 plementation of recommendations con24 tained in the proposal for a change in the 

25 payment rate for an item or service that 


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1 was effective during such period pursuant 

2 to subsection (e)(2)(A). 

3 ‘‘(ii) The proposal shall not include 

4 any recommendation to ration health care, 

5 raise revenues or Medicare beneficiary pre6 miums under section 1818, 1818A, or 

7 1839, increase Medicare beneficiary cost8 sharing (including deductibles, coinsur9 ance, and copayments), or otherwise re10 strict benefits or modify eligibility criteria. 

11 ‘‘(iii) In the case of proposals sub12 mitted prior to December 31, 2018, the 

13 proposal shall not include any rec14 ommendation that would reduce payment 

15 rates for items and services furnished, 

16 prior to December 31, 2019, by providers 

17 of services (as defined in section 1861(u)) 

18 and suppliers (as defined in section 

19 1861(d)) scheduled, pursuant to the 

20 amendments made by section 3401 of the 

21 Patient Protection and Affordable Care 

22 Act, to receive a reduction to the infla23 tionary payment updates of such providers 

24 of services and suppliers in excess of a re25 duction due to productivity in a year in 


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1 which such recommendations would take 

2 effect. 

3 ‘‘(iv) As appropriate, the proposal 

4 shall include recommendations to reduce 

5 Medicare payments under parts C and D, 

6 such as reductions in direct subsidy pay7 ments to Medicare Advantage and pre8 scription drug plans specified under para9 graph (1) and (2) of section 1860D–15(a) 

10 that are related to administrative expenses 

11 (including profits) for basic coverage, deny12 ing high bids or removing high bids for 

13 prescription drug coverage from the cal14 culation of the national average monthly 

15 bid amount under section 1860D–13(a)(4), 

16 and reductions in payments to Medicare 

17 Advantage plans under clauses (i) and (ii) 

18 of section 1853(a)(1)(B) that are related 

19 to administrative expenses (including prof20 its) and performance bonuses for Medicare 

21 Advantage plans under section 1853(n). 

22 Any such recommendation shall not affect 

23 the base beneficiary premium percentage 

24 specified under 1860D–13(a). 


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1 ‘‘(v) The proposal shall include rec2 ommendations with respect to administra3 tive funding for the Secretary to carry out 

4 the recommendations contained in the pro5 posal. 

6 ‘‘(vi) The proposal shall only include 

7 recommendations related to the Medicare 

8 program. 

9 ‘‘(B) ADDITIONAL CONSIDERATIONS.—In 

10 developing and submitting each proposal under 

11 this section in a proposal year, the Board shall, 

12 to the extent feasible— 

13 ‘‘(i) give priority to recommendations 

14 that extend Medicare solvency; 

15 ‘‘(ii) include recommendations that— 

16 ‘‘(I) improve the health care de17 livery system and health outcomes, in18 cluding by promoting integrated care, 

19 care coordination, prevention and 

20 wellness, and quality and efficiency 

21 improvement; and 

22 ‘‘(II) protect and improve Medi23 care beneficiaries’ access to necessary 

24 and evidence-based items and services, 

25 including in rural and frontier areas; 


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1 ‘‘(iii) include recommendations that 

2 target reductions in Medicare program 

3 spending to sources of excess cost growth; 

4 ‘‘(iv) consider the effects on Medicare 

5 beneficiaries of changes in payments to 

6 providers of services (as defined in section 

7 1861(u)) and suppliers (as defined in sec8 tion 1861(d)); 

9 ‘‘(v) consider the effects of the rec10 ommendations on providers of services and 

11 suppliers with actual or projected negative 

12 cost margins or payment updates; and 

13 ‘‘(vi) consider the unique needs of 

14 Medicare beneficiaries who are dually eligi15 ble for Medicare and the Medicaid program 

16 under title XIX. 

17 ‘‘(C) NO INCREASE IN TOTAL MEDICARE

18 PROGRAM SPENDING.—Each proposal submitted 

19 under this section shall be designed in such a 

20 manner that implementation of the rec21 ommendations contained in the proposal would 

22 not be expected to result, over the 10-year pe23 riod starting with the implementation year, in 

24 any increase in the total amount of net Medi25 care program spending relative to the total 


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1 amount of net Medicare program spending that 

2 would have occurred absent such implementa3 tion. 

4 ‘‘(D) CONSULTATION WITH MEDPAC.—The 

5 Board shall submit a draft copy of each pro6 posal to be submitted under this section to the 

7 Medicare Payment Advisory Commission estab8 lished under section 1805 for its review. The 

9 Board shall submit such draft copy by not later 

10 than September 1 of the determination year. 

11 ‘‘(E) REVIEW AND COMMENT BY THE SEC12 RETARY.—The Board shall submit a draft copy 

13 of each proposal to be submitted to Congress 

14 under this section to the Secretary for the Sec15 retary’s review and comment. The Board shall 

16 submit such draft copy by not later than Sep17 tember 1 of the determination year. Not later 

18 than March 1 of the submission year, the Sec19 retary shall submit a report to Congress on the 

20 results of such review, unless the Secretary sub21 mits a proposal under paragraph (5)(A) in that 

22 year. 

23 ‘‘(F) CONSULTATIONS.—In carrying out 

24 its duties under this section, the Board shall 

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1 icaid and CHIP Payment and Access Commis2 sion under section 1900. 

3 ‘‘(3) TRANSMISSION OF BOARD PROPOSAL TO

4 PRESIDENT.— 

5 ‘‘(A) IN GENERAL.— 

6 ‘‘(i) IN GENERAL.—Except as pro7 vided in clause (ii) and subsection 

8 (f)(3)(B), the Board shall transmit a pro9 posal under this section to the President 

10 on January 15 of each year (beginning 

11 with 2014). 

12 ‘‘(ii) EXCEPTION.—The Board shall 

13 not submit a proposal under clause (i) in 

14 a proposal year if the year is— 

15 ‘‘(I) a year for which the Chief 

16 Actuary of the Centers for Medicare & 

17 Medicaid Services makes a determina18 tion in the determination year under 

19 paragraph (6)(A) that the growth rate 

20 described in clause (i) of such para21 graph does not exceed the growth rate 

22 described in clause (ii) of such para23 graph; 

24 ‘‘(II) a year in which the Chief 

25 Actuary of the Centers for Medicare & 


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1 Medicaid Services makes a determina2 tion in the determination year that 

3 the projected percentage increase (if 

4 any) for the medical care expenditure 

5 category of the Consumer Price Index 

6 for All Urban Consumers (United 

7 States city average) for the implemen8 tation year is less than the projected 

9 percentage increase (if any) in the 

10 Consumer Price Index for All Urban 

11 Consumers (all items; United States 

12 city average) for such implementation 

13 year; or 

14 ‘‘(III) for proposal year 2019 and 

15 subsequent proposal years, a year in 

16 which the Chief Actuary of the Cen17 ters for Medicare & Medicaid Services 

18 makes a determination in the deter19 mination year that the growth rate 

20 described in paragraph (8) exceeds 

21 the growth rate described in para22 graph (6)(A)(i). 

23 ‘‘(iii) START-UP PERIOD.—The Board 

24 may not submit a proposal under clause (i) 

25 prior to January 15, 2014. 


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1 ‘‘(B) REQUIRED INFORMATION.—Each 

2 proposal submitted by the Board under sub3 paragraph (A)(i) shall include— 

4 ‘‘(i) the recommendations described in 

5 paragraph (2)(A)(i); 

6 ‘‘(ii) an explanation of each rec7 ommendation contained in the proposal 

8 and the reasons for including such rec9 ommendation; 

10 ‘‘(iii) an actuarial opinion by the 

11 Chief Actuary of the Centers for Medicare 

12 & Medicaid Services certifying that the 

13 proposal meets the requirements of sub14 paragraphs (A)(i) and (C) of paragraph 

15 (2); 

16 ‘‘(iv) a legislative proposal that imple17 ments the recommendations; and 

18 ‘‘(v) other information determined ap19 propriate by the Board. 

20 ‘‘(4) PRESIDENTIAL SUBMISSION TO CON21 GRESS.—Upon receiving a proposal from the Board 

22 under paragraph (3)(A)(i) or the Secretary under 

23 paragraph (5), the President shall immediately sub24 mit such proposal to Congress. 


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1 ‘‘(5) CONTINGENT SECRETARIAL DEVELOP2 MENT OF PROPOSAL.—If, with respect to a proposal 

3 year, the Board is required, to but fails, to submit 

4 a proposal to the President by the deadline applica5 ble under paragraph (3)(A)(i), the Secretary shall 

6 develop a detailed and specific proposal that satisfies 

7 the requirements of subparagraphs (A) and (C) 

8 (and, to the extent feasible, subparagraph (B)) of 

9 paragraph (2) and contains the information required 

10 paragraph (3)(B)). By not later than January 25 of 

11 the year, the Secretary shall transmit— 

12 ‘‘(A) such proposal to the President; and 

13 ‘‘(B) a copy of such proposal to the Medi14 care Payment Advisory Commission for its re15 view. 

16 ‘‘(6) PER CAPITA GROWTH RATE PROJECTIONS

17 BY CHIEF ACTUARY.— 

18 ‘‘(A) IN GENERAL.—Subject to subsection 

19 (f)(3)(A), not later than April 30, 2013, and 

20 annually thereafter, the Chief Actuary of the 

21 Centers for Medicare & Medicaid Services shall 

22 determine in each such year whether— 

23 ‘‘(i) the projected Medicare per capita 

24 growth rate for the implementation year 


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1 (as determined under subparagraph (B)); 

2 exceeds 

3 ‘‘(ii) the projected Medicare per capita 

4 target growth rate for the implementation 

5 year (as determined under subparagraph 

6 (C)). 

7 ‘‘(B) MEDICARE PER CAPITA GROWTH

8 RATE.— 

9 ‘‘(i) IN GENERAL.—For purposes of 

10 this section, the Medicare per capita 

11 growth rate for an implementation year 

12 shall be calculated as the projected 5-year 

13 average (ending with such year) of the 

14 growth in Medicare program spending per 

15 unduplicated enrollee. 

16 ‘‘(ii) REQUIREMENT.—The projection 

17 under clause (i) shall— 

18 ‘‘(I) to the extent that there is 

19 projected to be a negative update to 

20 the single conversion factor applicable 

21 to payments for physicians’ services 

22 under section 1848(d) furnished in 

23 the proposal year or the implementa24 tion year, assume that such update 

25 for such services is 0 percent rather 


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1 than the negative percent that would 

2 otherwise apply; and 

3 ‘‘(II) take into account any deliv4 ery system reforms or other payment 

5 changes that have been enacted or 

6 published in final rules but not yet 

7 implemented as of the making of such 

8 calculation. 

9 ‘‘(C) MEDICARE PER CAPITA TARGET

10 GROWTH RATE.—For purposes of this section, 

11 the Medicare per capita target growth rate for 

12 an implementation year shall be calculated as 

13 the projected 5-year average (ending with such 

14 year) percentage increase in— 

15 ‘‘(i) with respect to a determination 

16 year that is prior to 2018, the average of 

17 the projected percentage increase (if any) 

18 in— 

19 ‘‘(I) the Consumer Price Index 

20 for All Urban Consumers (all items; 

21 United States city average); and 

22 ‘‘(II) the medical care expendi23 ture category of the Consumer Price 

24 Index for All Urban Consumers 

25 (United States city average); and 


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1 ‘‘(ii) with respect to a determination 

2 year that is after 2017, the nominal gross 

3 domestic product per capita plus 1.0 per4 centage point. 

5 ‘‘(7) SAVINGS REQUIREMENT.— 

6 ‘‘(A) IN GENERAL.—If, with respect to a 

7 determination year, the Chief Actuary of the 

8 Centers for Medicare & Medicaid Services 

9 makes a determination under paragraph (6)(A) 

10 that the growth rate described in clause (i) of 

11 such paragraph exceeds the growth rate de12 scribed in clause (ii) of such paragraph, the 

13 Chief Actuary shall establish an applicable sav14 ings target for the implementation year. 

15 ‘‘(B) APPLICABLE SAVINGS TARGET.—For 

16 purposes of this section, the applicable savings 

17 target for an implementation year shall be an 

18 amount equal to the product of— 

19 ‘‘(i) the total amount of projected 

20 Medicare program spending for the pro21 posal year; and 

22 ‘‘(ii) the applicable percent for the im23 plementation year. 

24 ‘‘(C) APPLICABLE PERCENT.—For pur25 poses of subparagraph (B), the applicable perVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01015 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 cent for an implementation year is the lesser 

2 of— 

3 ‘‘(i) in the case of— 

4 ‘‘(I) implementation year 2015, 

5 0.5 percent; 

6 ‘‘(II) implementation year 2016, 

7 1.0 percent; 

8 ‘‘(III) implementation year 2017, 

9 1.25 percent; and 

10 ‘‘(IV) implementation year 2018 

11 or any subsequent implementation 

12 year, 1.5 percent; and 

13 ‘‘(ii) the projected excess for the im14 plementation year (expressed as a percent) 

15 determined under subparagraph (A). 

16 ‘‘(8) PER CAPITA RATE OF GROWTH IN NA17 TIONAL HEALTH EXPENDITURES.—In each deter18 mination year (beginning in 2018), the Chief Actu19 ary of the Centers for Medicare & Medicaid Services 

20 shall project the per capita rate of growth in na21 tional health expenditures for the implementation 

22 year. Such rate of growth for an implementation 

23 year shall be calculated as the projected 5-year aver24 age (ending with such year) percentage increase in 

25 national health care expenditures. 


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1 ‘‘(d) CONGRESSIONAL CONSIDERATION.— 

2 ‘‘(1) INTRODUCTION.— 

3 ‘‘(A) IN GENERAL.—On the day on which 

4 a proposal is submitted by the President to the 

5 House of Representatives and the Senate under 

6 subsection (c)(4), the legislative proposal (de7 scribed in subsection (c)(3)(B)(iv)) contained in 

8 the proposal shall be introduced (by request) in 

9 the Senate by the majority leader of the Senate 

10 or by Members of the Senate designated by the 

11 majority leader of the Senate and shall be in12 troduced (by request) in the House by the ma13 jority leader of the House or by Members of the 

14 House designated by the majority leader of the 

15 House. 

16 ‘‘(B) NOT IN SESSION.—If either House is 

17 not in session on the day on which such legisla18 tive proposal is submitted, the legislative pro19 posal shall be introduced in that House, as pro20 vided in subparagraph (A), on the first day 

21 thereafter on which that House is in session. 

22 ‘‘(C) ANY MEMBER.—If the legislative pro23 posal is not introduced in either House within 

24 5 days on which that House is in session after 

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1 mitted, then any Member of that House may 

2 introduce the legislative proposal. 

3 ‘‘(D) REFERRAL.—The legislation intro4 duced under this paragraph shall be referred by 

5 the Presiding Officers of the respective Houses 

6 to the Committee on Finance in the Senate and 

7 to the Committee on Energy and Commerce 

8 and the Committee on Ways and Means in the 

9 House of Representatives. 

10 ‘‘(2) COMMITTEE CONSIDERATION OF PRO11 POSAL.— 

12 ‘‘(A) REPORTING BILL.—Not later than 

13 April 1 of any proposal year in which a pro14 posal is submitted by the President to Congress 

15 under this section, the Committee on Ways and 

16 Means and the Committee on Energy and Com17 merce of the House of Representatives and the 

18 Committee on Finance of the Senate may re19 port the bill referred to the Committee under 

20 paragraph (1)(D) with committee amendments 

21 related to the Medicare program. 

22 ‘‘(B) CALCULATIONS.—In determining 

23 whether a committee amendment meets the re24 quirement of subparagraph (A), the reductions 

25 in Medicare program spending during the 3- 


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1 month period immediately preceding the imple2 mentation year shall be counted to the extent 

3 that such reductions are a result of the imple4 mentation provisions in the committee amend5 ment for a change in the payment rate for an 

6 item or service that was effective during such 

7 period pursuant to such amendment. 

8 ‘‘(C) COMMITTEE JURISDICTION.—Not9 withstanding rule XV of the Standing Rules of 

10 the Senate, a committee amendment described 

11 in subparagraph (A) may include matter not 

12 within the jurisdiction of the Committee on Fi13 nance if that matter is relevant to a proposal 

14 contained in the bill submitted under subsection 

15 (c)(3). 

16 ‘‘(D) DISCHARGE.—If, with respect to the 

17 House involved, the committee has not reported 

18 the bill by the date required by subparagraph 

19 (A), the committee shall be discharged from 

20 further consideration of the proposal. 

21 ‘‘(3) LIMITATION ON CHANGES TO THE BOARD

22 RECOMMENDATIONS.— 

23 ‘‘(A) IN GENERAL.—It shall not be in 

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1 ment, pursuant to this subsection or conference 

2 report thereon, that fails to satisfy the require3 ments of subparagraphs (A)(i) and (C) of sub4 section (c)(2). 

5 ‘‘(B) LIMITATION ON CHANGES TO THE

6 BOARD RECOMMENDATIONS IN OTHER LEGISLA7 TION.—It shall not be in order in the Senate or 

8 the House of Representatives to consider any 

9 bill, resolution, amendment, or conference re10 port (other than pursuant to this section) that 

11 would repeal or otherwise change the rec12 ommendations of the Board if that change 

13 would fail to satisfy the requirements of sub14 paragraphs (A)(i) and (C) of subsection (c)(2). 

15 ‘‘(C) LIMITATION ON CHANGES TO THIS

16 SUBSECTION.—It shall not be in order in the 

17 Senate or the House of Representatives to con18 sider any bill, resolution, amendment, or con19 ference report that would repeal or otherwise 

20 change this subsection. 

21 ‘‘(D) WAIVER.—This paragraph may be 

22 waived or suspended in the Senate only by the 

23 affirmative vote of three-fifths of the Members, 

24 duly chosen and sworn. 


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1 ‘‘(E) APPEALS.—An affirmative vote of 

2 three-fifths of the Members of the Senate, duly 

3 chosen and sworn, shall be required in the Sen4 ate to sustain an appeal of the ruling of the 

5 Chair on a point of order raised under this 

6 paragraph. 

7 ‘‘(4) EXPEDITED PROCEDURE.— 

8 ‘‘(A) CONSIDERATION.—A motion to pro9 ceed to the consideration of the bill in the Sen10 ate is not debatable. 

11 ‘‘(B) AMENDMENT.— 

12 ‘‘(i) TIME LIMITATION.—Debate in 

13 the Senate on any amendment to a bill 

14 under this section shall be limited to 1 

15 hour, to be equally divided between, and 

16 controlled by, the mover and the manager 

17 of the bill, and debate on any amendment 

18 to an amendment, debatable motion, or ap19 peal shall be limited to 30 minutes, to be 

20 equally divided between, and controlled by, 

21 the mover and the manager of the bill, ex22 cept that in the event the manager of the 

23 bill is in favor of any such amendment, 

24 motion, or appeal, the time in opposition 


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1 thereto shall be controlled by the minority 

2 leader or such leader’s designee. 

3 ‘‘(ii) GERMANE.—No amendment that 

4 is not germane to the provisions of such 

5 bill shall be received. 

6 ‘‘(iii) ADDITIONAL TIME.—The lead7 ers, or either of them, may, from the time 

8 under their control on the passage of the 

9 bill, allot additional time to any Senator 

10 during the consideration of any amend11 ment, debatable motion, or appeal. 

12 ‘‘(iv) AMENDMENT NOT IN ORDER.— 

13 It shall not be in order to consider an 

14 amendment that would cause the bill to re15 sult in a net reduction in total Medicare 

16 program spending in the implementation 

17 year that is less than the applicable sav18 ings target established under subsection 

19 (c)(7)(B) for such implementation year. 

20 ‘‘(v) WAIVER AND APPEALS.—This 

21 paragraph may be waived or suspended in 

22 the Senate only by the affirmative vote of 

23 three-fifths of the Members, duly chosen 

24 and sworn. An affirmative vote of three25 fifths of the Members of the Senate, duly 


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1 chosen and sworn, shall be required in the 

2 Senate to sustain an appeal of the ruling 

3 of the Chair on a point of order raised 

4 under this section. 

5 ‘‘(C) CONSIDERATION BY THE OTHER

6 HOUSE.— 

7 ‘‘(i) IN GENERAL.—The expedited 

8 procedures provided in this subsection for 

9 the consideration of a bill introduced pur10 suant to paragraph (1) shall not apply to 

11 such a bill that is received by one House 

12 from the other House if such a bill was not 

13 introduced in the receiving House. 

14 ‘‘(ii) BEFORE PASSAGE.—If a bill that 

15 is introduced pursuant to paragraph (1) is 

16 received by one House from the other 

17 House, after introduction but before dis18 position of such a bill in the receiving 

19 House, then the following shall apply: 

20 ‘‘(I) The receiving House shall 

21 consider the bill introduced in that 

22 House through all stages of consider23 ation up to, but not including, pas24 sage. 


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1 ‘‘(II) The question on passage 

2 shall be put on the bill of the other 

3 House as amended by the language of 

4 the receiving House. 

5 ‘‘(iii) AFTER PASSAGE.—If a bill in6 troduced pursuant to paragraph (1) is re7 ceived by one House from the other House, 

8 after such a bill is passed by the receiving 

9 House, then the vote on passage of the bill 

10 that originates in the receiving House shall 

11 be considered to be the vote on passage of 

12 the bill received from the other House as 

13 amended by the language of the receiving 

14 House. 

15 ‘‘(iv) DISPOSITION.—Upon disposition 

16 of a bill introduced pursuant to paragraph 

17 (1) that is received by one House from the 

18 other House, it shall no longer be in order 

19 to consider the bill that originates in the 

20 receiving House. 

21 ‘‘(v) LIMITATION.—Clauses (ii), (iii), 

22 and (iv) shall apply only to a bill received 

23 by one House from the other House if the 

24 bill— 


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1 ‘‘(I) is related only to the pro2 gram under this title; and 

3 ‘‘(II) satisfies the requirements 

4 of subparagraphs (A)(i) and (C) of 

5 subsection (c)(2). 

6 ‘‘(D) SENATE LIMITS ON DEBATE.— 

7 ‘‘(i) IN GENERAL.—In the Senate, 

8 consideration of the bill and on all debat9 able motions and appeals in connection 

10 therewith shall not exceed a total of 30 

11 hours, which shall be divided equally be12 tween the majority and minority leaders or 

13 their designees. 

14 ‘‘(ii) MOTION TO FURTHER LIMIT DE15 BATE.—A motion to further limit debate 

16 on the bill is in order and is not debatable. 

17 ‘‘(iii) MOTION OR APPEAL.—Any de18 batable motion or appeal is debatable for 

19 not to exceed 1 hour, to be divided equally 

20 between those favoring and those opposing 

21 the motion or appeal. 

22 ‘‘(iv) FINAL DISPOSITION.—After 30 

23 hours of consideration, the Senate shall 

24 proceed, without any further debate on any 

25 question, to vote on the final disposition 


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1 thereof to the exclusion of all amendments 

2 not then pending before the Senate at that 

3 time and to the exclusion of all motions, 

4 except a motion to table, or to reconsider 

5 and one quorum call on demand to estab6 lish the presence of a quorum (and mo7 tions required to establish a quorum) im8 mediately before the final vote begins. 

9 ‘‘(E) CONSIDERATION IN CONFERENCE.— 

10 ‘‘(i) IN GENERAL.—Consideration in 

11 the Senate and the House of Representa12 tives on the conference report or any mes13 sages between Houses shall be limited to 

14 10 hours, equally divided and controlled by 

15 the majority and minority leaders of the 

16 Senate or their designees and the Speaker 

17 of the House of Representatives and the 

18 minority leader of the House of Represent19 atives or their designees. 

20 ‘‘(ii) TIME LIMITATION.—Debate in 

21 the Senate on any amendment under this 

22 subparagraph shall be limited to 1 hour, to 

23 be equally divided between, and controlled 

24 by, the mover and the manager of the bill, 

25 and debate on any amendment to an 


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1 amendment, debatable motion, or appeal 

2 shall be limited to 30 minutes, to be equal3 ly divided between, and controlled by, the 

4 mover and the manager of the bill, except 

5 that in the event the manager of the bill 

6 is in favor of any such amendment, mo7 tion, or appeal, the time in opposition 

8 thereto shall be controlled by the minority 

9 leader or such leader’s designee. 

10 ‘‘(iii) FINAL DISPOSITION.—After 10 

11 hours of consideration, the Senate shall 

12 proceed, without any further debate on any 

13 question, to vote on the final disposition 

14 thereof to the exclusion of all motions not 

15 then pending before the Senate at that 

16 time or necessary to resolve the differences 

17 between the Houses and to the exclusion of 

18 all other motions, except a motion to table, 

19 or to reconsider and one quorum call on 

20 demand to establish the presence of a 

21 quorum (and motions required to establish 

22 a quorum) immediately before the final 

23 vote begins. 

24 ‘‘(iv) LIMITATION.—Clauses (i) 

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1 ference report, message or the amendments 

2 thereto if the conference report, message, 

3 or an amendment thereto— 

4 ‘‘(I) is related only to the pro5 gram under this title; and 

6 ‘‘(II) satisfies the requirements 

7 of subparagraphs (A)(i) and (C) of 

8 subsection (c)(2). 

9 ‘‘(F) VETO.—If the President vetoes the 

10 bill debate on a veto message in the Senate 

11 under this subsection shall be 1 hour equally di12 vided between the majority and minority leaders 

13 or their designees. 

14 ‘‘(5) RULES OF THE SENATE AND HOUSE OF

15 REPRESENTATIVES.—This subsection and subsection 

16 (f)(2) are enacted by Congress— 

17 ‘‘(A) as an exercise of the rulemaking 

18 power of the Senate and the House of Rep19 resentatives, respectively, and is deemed to be 

20 part of the rules of each House, respectively, 

21 but applicable only with respect to the proce22 dure to be followed in that House in the case 

23 of bill under this section, and it supersedes 

24 other rules only to the extent that it is incon25 sistent with such rules; and 


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1 ‘‘(B) with full recognition of the constitu2 tional right of either House to change the rules 

3 (so far as they relate to the procedure of that 

4 House) at any time, in the same manner, and 

5 to the same extent as in the case of any other 

6 rule of that House. 

7 ‘‘(e) IMPLEMENTATION OF PROPOSAL.— 

8 ‘‘(1) IN GENERAL.—Notwithstanding any other 

9 provision of law, the Secretary shall, except as pro10 vided in paragraph (3), implement the recommenda11 tions contained in a proposal submitted by the Presi12 dent to Congress pursuant to this section on August 

13 15 of the year in which the proposal is so submitted. 

14 ‘‘(2) APPLICATION.— 

15 ‘‘(A) IN GENERAL.—A recommendation de16 scribed in paragraph (1) shall apply as follows: 

17 ‘‘(i) In the case of a recommendation 

18 that is a change in the payment rate for 

19 an item or service under Medicare in which 

20 payment rates change on a fiscal year 

21 basis (or a cost reporting period basis that 

22 relates to a fiscal year), on a calendar year 

23 basis (or a cost reporting period basis that 

24 relates to a calendar year), or on a rate 

25 year basis (or a cost reporting period basis 


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•AMDT. NO. 2786 

1 that relates to a rate year), such rec2 ommendation shall apply to items and 

3 services furnished on the first day of the 

4 first fiscal year, calendar year, or rate year 

5 (as the case may be) that begins after such 

6 August 15. 

7 ‘‘(ii) In the case of a recommendation 

8 relating to payments to plans under parts 

9 C and D, such recommendation shall apply 

10 to plan years beginning on the first day of 

11 the first calendar year that begins after 

12 such August 15. 

13 ‘‘(iii) In the case of any other rec14 ommendation, such recommendation shall 

15 be addressed in the regular regulatory 

16 process timeframe and shall apply as soon 

17 as practicable. 

18 ‘‘(B) INTERIM FINAL RULEMAKING.—The 

19 Secretary may use interim final rulemaking to 

20 implement any recommendation described in 

21 paragraph (1). 

22 ‘‘(3) EXCEPTION.—The Secretary shall not be 

23 required to implement the recommendations con24 tained in a proposal submitted in a proposal year by 


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1 the President to Congress pursuant to this section 

2 if— 

3 ‘‘(A) prior to August 15 of the proposal 

4 year, Federal legislation is enacted that in5 cludes the following provision: ‘This Act 

6 supercedes the recommendations of the Board 

7 contained in the proposal submitted, in the year 

8 which includes the date of enactment of this 

9 Act, to Congress under section 1899A of the 

10 Social Security Act.’; and 

11 ‘‘(B) in the case of implementation year 

12 2020 and subsequent implementation years, a 

13 joint resolution described in subsection (f)(1) is 

14 enacted not later than August 15, 2017. 

15 ‘‘(4) NO AFFECT ON AUTHORITY TO IMPLE16 MENT CERTAIN PROVISIONS.—Nothing in paragraph 

17 (3) shall be construed to affect the authority of the 

18 Secretary to implement any recommendation con19 tained in a proposal or advisory report under this 

20 section to the extent that the Secretary otherwise 

21 has the authority to implement such recommenda22 tion administratively. 

23 ‘‘(5) LIMITATION ON REVIEW.—There shall be 

24 no administrative or judicial review under section 

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1 tion by the Secretary under this subsection of the 

2 recommendations contained in a proposal. 

3 ‘‘(f) JOINT RESOLUTION REQUIRED TO DIS4 CONTINUE THE BOARD.— 

5 ‘‘(1) IN GENERAL.—For purposes of subsection 

6 (e)(3)(B), a joint resolution described in this para7 graph means only a joint resolution— 

8 ‘‘(A) that is introduced in 2017 by not 

9 later than February 1 of such year; 

10 ‘‘(B) which does not have a preamble; 

11 ‘‘(C) the title of which is as follows: ‘Joint 

12 resolution approving the discontinuation of the 

13 process for consideration and automatic imple14 mentation of the annual proposal of the Inde15 pendent Medicare Advisory Board under section 

16 1899A of the Social Security Act’; and 

17 ‘‘(D) the matter after the resolving clause 

18 of which is as follows: ‘That Congress approves 

19 the discontinuation of the process for consider20 ation and automatic implementation of the an21 nual proposal of the Independent Medicare Ad22 visory Board under section 1899A of the Social 

23 Security Act.’. 

24 ‘‘(2) PROCEDURE.— 


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1 ‘‘(A) REFERRAL.—A joint resolution de2 scribed in paragraph (1) shall be referred to the 

3 Committee on Ways and Means and the Com4 mittee on Energy and Commerce of the House 

5 of Representatives and the Committee on Fi6 nance of the Senate. 

7 ‘‘(B) DISCHARGE.—In the Senate, if the 

8 committee to which is referred a joint resolution 

9 described in paragraph (1) has not reported 

10 such joint resolution (or an identical joint reso11 lution) at the end of 20 days after the joint res12 olution described in paragraph (1) is intro13 duced, such committee may be discharged from 

14 further consideration of such joint resolution 

15 upon a petition supported in writing by 30 

16 Members of the Senate, and such joint resolu17 tion shall be placed on the calendar. 

18 ‘‘(C) CONSIDERATION.— 

19 ‘‘(i) IN GENERAL.—In the Senate, 

20 when the committee to which a joint reso21 lution is referred has reported, or when a 

22 committee is discharged (under subpara23 graph (C)) from further consideration of a 

24 joint resolution described in paragraph (1), 

25 it is at any time thereafter in order (even 


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•AMDT. NO. 2786 

1 though a previous motion to the same ef2 fect has been disagreed to) for a motion to 

3 proceed to the consideration of the joint 

4 resolution to be made, and all points of 

5 order against the joint resolution (and 

6 against consideration of the joint resolu7 tion) are waived, except for points of order 

8 under the Congressional Budget act of 

9 1974 or under budget resolutions pursuant 

10 to that Act. The motion is not debatable. 

11 A motion to reconsider the vote by which 

12 the motion is agreed to or disagreed to 

13 shall not be in order. If a motion to pro14 ceed to the consideration of the joint reso15 lution is agreed to, the joint resolution 

16 shall remain the unfinished business of the 

17 Senate until disposed of. 

18 ‘‘(ii) DEBATE LIMITATION.—In the 

19 Senate, consideration of the joint resolu20 tion, and on all debatable motions and ap21 peals in connection therewith, shall be lim22 ited to not more than 10 hours, which 

23 shall be divided equally between the major24 ity leader and the minority leader, or their 

25 designees. A motion further to limit debate 


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1 is in order and not debatable. An amend2 ment to, or a motion to postpone, or a mo3 tion to proceed to the consideration of 

4 other business, or a motion to recommit 

5 the joint resolution is not in order. 

6 ‘‘(iii) PASSAGE.—In the Senate, im7 mediately following the conclusion of the 

8 debate on a joint resolution described in 

9 paragraph (1), and a single quorum call at 

10 the conclusion of the debate if requested in 

11 accordance with the rules of the Senate, 

12 the vote on passage of the joint resolution 

13 shall occur. 

14 ‘‘(iv) APPEALS.—Appeals from the de15 cisions of the Chair relating to the applica16 tion of the rules of the Senate to the pro17 cedure relating to a joint resolution de18 scribed in paragraph (1) shall be decided 

19 without debate. 

20 ‘‘(D) OTHER HOUSE ACTS FIRST.—If, be21 fore the passage by 1 House of a joint resolu22 tion of that House described in paragraph (1), 

23 that House receives from the other House a 

24 joint resolution described in paragraph (1), 

25 then the following procedures shall apply: 


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1 ‘‘(i) The joint resolution of the other 

2 House shall not be referred to a com3 mittee. 

4 ‘‘(ii) With respect to a joint resolution 

5 described in paragraph (1) of the House 

6 receiving the joint resolution— 

7 ‘‘(I) the procedure in that House 

8 shall be the same as if no joint resolu9 tion had been received from the other 

10 House; but 

11 ‘‘(II) the vote on final passage 

12 shall be on the joint resolution of the 

13 other House. 

14 ‘‘(E) EXCLUDED DAYS.—For purposes of 

15 determining the period specified in subpara16 graph (B), there shall be excluded any days ei17 ther House of Congress is adjourned for more 

18 than 3 days during a session of Congress. 

19 ‘‘(F) MAJORITY REQUIRED FOR ADOP20 TION.—A joint resolution considered under this 

21 subsection shall require an affirmative vote of 

22 three-fifths of the Members, duly chosen and 

23 sworn, for adoption. 


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1 ‘‘(3) TERMINATION.—If a joint resolution de2 scribed in paragraph (1) is enacted not later than 

3 August 15, 2017— 

4 ‘‘(A) the Chief Actuary of the Medicare & 

5 Medicaid Services shall not— 

6 ‘‘(i) make any determinations under 

7 subsection (c)(6) after May 1, 2017; or 

8 ‘‘(ii) provide any opinion pursuant to 

9 subsection (c)(3)(B)(iii) after January 16, 

10 2018; 

11 ‘‘(B) the Board shall not submit any pro12 posals or advisory reports to Congress under 

13 this section after January 16, 2018; and 

14 ‘‘(C) the Board and the consumer advisory 

15 council under subsection (k) shall terminate on 

16 August 16, 2018. 

17 ‘‘(g) BOARD MEMBERSHIP; TERMS OF OFFICE; 

18 CHAIRPERSON; REMOVAL.— 

19 ‘‘(1) MEMBERSHIP.— 

20 ‘‘(A) IN GENERAL.—The Board shall be 

21 composed of— 

22 ‘‘(i) 15 members appointed by the 

23 President, by and with the advice and con24 sent of the Senate; and 


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1 ‘‘(ii) the Secretary, the Administrator 

2 of the Center for Medicare & Medicaid 

3 Services, and the Administrator of the 

4 Health Resources and Services Administra5 tion, all of whom shall serve ex officio as 

6 nonvoting members of the Board. 

7 ‘‘(B) QUALIFICATIONS.— 

8 ‘‘(i) IN GENERAL.—The appointed 

9 membership of the Board shall include in10 dividuals with national recognition for 

11 their expertise in health finance and eco12 nomics, actuarial science, health facility 

13 management, health plans and integrated 

14 delivery systems, reimbursement of health 

15 facilities, allopathic and osteopathic physi16 cians, and other providers of health serv17 ices, and other related fields, who provide 

18 a mix of different professionals, broad geo19 graphic representation, and a balance be20 tween urban and rural representatives. 

21 ‘‘(ii) INCLUSION.—The appointed 

22 membership of the Board shall include 

23 (but not be limited to) physicians and 

24 other health professionals, experts in the 

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1 tion drug benefit programs, employers, 

2 third-party payers, individuals skilled in 

3 the conduct and interpretation of bio4 medical, health services, and health eco5 nomics research and expertise in outcomes 

6 and effectiveness research and technology 

7 assessment. Such membership shall also 

8 include representatives of consumers and 

9 the elderly. 

10 ‘‘(iii) MAJORITY NONPROVIDERS.—In11 dividuals who are directly involved in the 

12 provision or management of the delivery of 

13 items and services covered under this title 

14 shall not constitute a majority of the ap15 pointed membership of the Board. 

16 ‘‘(C) ETHICAL DISCLOSURE.—The Presi17 dent shall establish a system for public disclo18 sure by appointed members of the Board of fi19 nancial and other potential conflicts of interest 

20 relating to such members. Appointed members 

21 of the Board shall be treated as officers in the 

22 executive branch for purposes of applying title 

23 I of the Ethics in Government Act of 1978 

24 (Public Law 95–521). 


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1 ‘‘(D) CONFLICTS OF INTEREST.—No indi2 vidual may serve as an appointed member if 

3 that individual engages in any other business, 

4 vocation, or employment. 

5 ‘‘(E) CONSULTATION WITH CONGRESS.—In 

6 selecting individuals for nominations for ap7 pointments to the Board, the President shall 

8 consult with— 

9 ‘‘(i) the majority leader of the Senate 

10 concerning the appointment of 3 members; 

11 ‘‘(ii) the Speaker of the House of 

12 Representatives concerning the appoint13 ment of 3 members; 

14 ‘‘(iii) the minority leader of the Sen15 ate concerning the appointment of 3 mem16 bers; and 

17 ‘‘(iv) the minority leader of the House 

18 of Representatives concerning the appoint19 ment of 3 members. 

20 ‘‘(2) TERM OF OFFICE.—Each appointed mem21 ber shall hold office for a term of 6 years except 

22 that— 

23 ‘‘(A) a member may not serve more than 

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1 appointed to 2 full consecutive terms after 

2 being appointed to fill a vacancy on the Board); 

3 ‘‘(B) a member appointed to fill a vacancy 

4 occurring prior to the expiration of the term for 

5 which that member’s predecessor was appointed 

6 shall be appointed for the remainder of such 

7 term; 

8 ‘‘(C) a member may continue to serve after 

9 the expiration of the member’s term until a suc10 cessor has taken office; and 

11 ‘‘(D) of the members first appointed under 

12 this section, 5 shall be appointed for a term of 

13 1 year, 5 shall be appointed for a term of 3 

14 years, and 5 shall be appointed for a term of 

15 6 years, the term of each to be designated by 

16 the President at the time of nomination. 

17 ‘‘(3) CHAIRPERSON.— 

18 ‘‘(A) IN GENERAL.—The Chairperson shall 

19 be appointed by the President, by and with the 

20 advice and consent of the Senate, from among 

21 the members of the Board. 

22 ‘‘(B) DUTIES.—The Chairperson shall be 

23 the principal executive officer of the Board, and 

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1 trative functions of the Board, including func2 tions of the Board with respect to— 

3 ‘‘(i) the appointment and supervision 

4 of personnel employed by the Board; 

5 ‘‘(ii) the distribution of business 

6 among personnel appointed and supervised 

7 by the Chairperson and among administra8 tive units of the Board; and 

9 ‘‘(iii) the use and expenditure of 

10 funds. 

11 ‘‘(C) GOVERNANCE.—In carrying out any 

12 of the functions under subparagraph (B), the 

13 Chairperson shall be governed by the general 

14 policies established by the Board and by the de15 cisions, findings, and determinations the Board 

16 shall by law be authorized to make. 

17 ‘‘(D) REQUESTS FOR APPROPRIATIONS.— 

18 Requests or estimates for regular, supple19 mental, or deficiency appropriations on behalf 

20 of the Board may not be submitted by the 

21 Chairperson without the prior approval of a ma22 jority vote of the Board. 

23 ‘‘(4) REMOVAL.—Any appointed member may 

24 be removed by the President for neglect of duty or 

25 malfeasance in office, but for no other cause. 


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1 ‘‘(h) VACANCIES; QUORUM; SEAL; VICE CHAIR2 PERSON; VOTING ON REPORTS.— 

3 ‘‘(1) VACANCIES.—No vacancy on the Board 

4 shall impair the right of the remaining members to 

5 exercise all the powers of the Board. 

6 ‘‘(2) QUORUM.—A majority of the appointed 

7 members of the Board shall constitute a quorum for 

8 the transaction of business, but a lesser number of 

9 members may hold hearings. 

10 ‘‘(3) SEAL.—The Board shall have an official 

11 seal, of which judicial notice shall be taken. 

12 ‘‘(4) VICE CHAIRPERSON.—The Board shall an13 nually elect a Vice Chairperson to act in the absence 

14 or disability of the Chairperson or in case of a va15 cancy in the office of the Chairperson. 

16 ‘‘(5) VOTING ON PROPOSALS.—Any proposal of 

17 the Board must be approved by the majority of ap18 pointed members present. 

19 ‘‘(i) POWERS OF THE BOARD.— 

20 ‘‘(1) HEARINGS.—The Board may hold such 

21 hearings, sit and act at such times and places, take 

22 such testimony, and receive such evidence as the 

23 Board considers advisable to carry out this section. 

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1 vise the Secretary on priorities for health services re2 search, particularly as such priorities pertain to nec3 essary changes and issues regarding payment re4 forms under Medicare. 

5 ‘‘(3) OBTAINING OFFICIAL DATA.—The Board 

6 may secure directly from any department or agency 

7 of the United States information necessary to enable 

8 it to carry out this section. Upon request of the 

9 Chairperson, the head of that department or agency 

10 shall furnish that information to the Board on an 

11 agreed upon schedule. 

12 ‘‘(4) POSTAL SERVICES.—The Board may use 

13 the United States mails in the same manner and 

14 under the same conditions as other departments and 

15 agencies of the Federal Government. 

16 ‘‘(5) GIFTS.—The Board may accept, use, and 

17 dispose of gifts or donations of services or property. 

18 ‘‘(6) OFFICES.—The Board shall maintain a 

19 principal office and such field offices as it deter20 mines necessary, and may meet and exercise any of 

21 its powers at any other place. 

22 ‘‘(j) PERSONNEL MATTERS.— 

23 ‘‘(1) COMPENSATION OF MEMBERS AND CHAIR24 PERSON.—Each appointed member, other than the 

25 Chairperson, shall be compensated at a rate equal to 


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1 the annual rate of basic pay prescribed for level III 

2 of the Executive Schedule under section 5315 of title 

3 5, United States Code. The Chairperson shall be 

4 compensated at a rate equal to the daily equivalent 

5 of the annual rate of basic pay prescribed for level 

6 II of the Executive Schedule under section 5315 of 

7 title 5, United States Code. 

8 ‘‘(2) TRAVEL EXPENSES.—The appointed mem9 bers shall be allowed travel expenses, including per 

10 diem in lieu of subsistence, at rates authorized for 

11 employees of agencies under subchapter I of chapter 

12 57 of title 5, United States Code, while away from 

13 their homes or regular places of business in the per14 formance of services for the Board. 

15 ‘‘(3) STAFF.— 

16 ‘‘(A) IN GENERAL.—The Chairperson may, 

17 without regard to the civil service laws and reg18 ulations, appoint and terminate an executive di19 rector and such other additional personnel as 

20 may be necessary to enable the Board to per21 form its duties. The employment of an executive 

22 director shall be subject to confirmation by the 

23 Board. 

24 ‘‘(B) COMPENSATION.—The Chairperson 

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1 tor and other personnel without regard to chap2 ter 51 and subchapter III of chapter 53 of title 

3 5, United States Code, relating to classification 

4 of positions and General Schedule pay rates, ex5 cept that the rate of pay for the executive direc6 tor and other personnel may not exceed the rate 

7 payable for level V of the Executive Schedule 

8 under section 5316 of such title. 

9 ‘‘(4) DETAIL OF GOVERNMENT EMPLOYEES.— 

10 Any Federal Government employee may be detailed 

11 to the Board without reimbursement, and such de12 tail shall be without interruption or loss of civil serv13 ice status or privilege. 

14 ‘‘(5) PROCUREMENT OF TEMPORARY AND

15 INTERMITTENT SERVICES.—The Chairperson may 

16 procure temporary and intermittent services under 

17 section 3109(b) of title 5, United States Code, at 

18 rates for individuals which do not exceed the daily 

19 equivalent of the annual rate of basic pay prescribed 

20 for level V of the Executive Schedule under section 

21 5316 of such title. 

22 ‘‘(k) CONSUMER ADVISORY COUNCIL.— 

23 ‘‘(1) IN GENERAL.—There is established a con24 sumer advisory council to advise the Board on the 


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1 impact of payment policies under this title on con2 sumers. 

3 ‘‘(2) MEMBERSHIP.— 

4 ‘‘(A) NUMBER AND APPOINTMENT.—The 

5 consumer advisory council shall be composed of 

6 10 consumer representatives appointed by the 

7 Comptroller General of the United States, 1 

8 from among each of the 10 regions established 

9 by the Secretary as of the date of enactment of 

10 this section. 

11 ‘‘(B) QUALIFICATIONS.—The membership 

12 of the council shall represent the interests of 

13 consumers and particular communities. 

14 ‘‘(3) DUTIES.—The consumer advisory council 

15 shall, subject to the call of the Board, meet not less 

16 frequently than 2 times each year in the District of 

17 Columbia. 

18 ‘‘(4) OPEN MEETINGS.—Meetings of the con19 sumer advisory council shall be open to the public. 

20 ‘‘(5) ELECTION OF OFFICERS.—Members of the 

21 consumer advisory council shall elect their own offi22 cers. 

23 ‘‘(6) APPLICATION OF FACA.—The Federal Ad24 visory Committee Act (5 U.S.C. App.) shall apply to 


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1 the consumer advisory council except that section 14 

2 of such Act shall not apply. 

3 ‘‘(l) DEFINITIONS.—In this section: 

4 ‘‘(1) BOARD; CHAIRPERSON; MEMBER.—The 

5 terms ‘Board’, ‘Chairperson’, and ‘Member’ mean 

6 the Independent Medicare Advisory Board estab7 lished under subsection (a) and the Chairperson and 

8 any Member thereof, respectively. 

9 ‘‘(2) MEDICARE.—The term ‘Medicare’ means 

10 the program established under this title, including 

11 parts A, B, C, and D. 

12 ‘‘(3) MEDICARE BENEFICIARY.—The term 

13 ‘Medicare beneficiary’ means an individual who is 

14 entitled to, or enrolled for, benefits under part A or 

15 enrolled for benefits under part B. 

16 ‘‘(4) MEDICARE PROGRAM SPENDING.—The 

17 term ‘Medicare program spending’ means program 

18 spending under parts A, B, and D net of premiums. 

19 ‘‘(m) FUNDING.— 

20 ‘‘(1) IN GENERAL.—There are appropriated to 

21 the Board to carry out its duties and functions— 

22 ‘‘(A) for fiscal year 2012, $15,000,000; 

23 and 

24 ‘‘(B) for each subsequent fiscal year, the 

25 amount appropriated under this paragraph for 


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1 the previous fiscal year increased by the annual 

2 percentage increase in the Consumer Price 

3 Index for All Urban Consumers (all items; 

4 United States city average) as of June of the 

5 previous fiscal year. 

6 ‘‘(2) FROM TRUST FUNDS.—Sixty percent of 

7 amounts appropriated under paragraph (1) shall be 

8 derived by transfer from the Federal Hospital Insur9 ance Trust Fund under section 1817 and 40 percent 

10 of amounts appropriated under such paragraph shall 

11 be derived by transfer from the Federal Supple12 mentary Medical Insurance Trust Fund under sec13 tion 1841.’’. 

14 (2) LOBBYING COOLING-OFF PERIOD FOR MEM15 BERS OF THE INDEPENDENT MEDICARE ADVISORY

16 BOARD.—Section 207(c) of title 18, United States 

17 Code, is amended by inserting at the end the fol18 lowing: 

19 ‘‘(3) MEMBERS OF THE INDEPENDENT MEDI20 CARE ADVISORY BOARD.— 

21 ‘‘(A) IN GENERAL.—Paragraph (1) shall 

22 apply to a member of the Independent Medicare 

23 Advisory Board under section 1899A. 

24 ‘‘(B) AGENCIES AND CONGRESS.—For pur25 poses of paragraph (1), the agency in which the 


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1 individual described in subparagraph (A) served 

2 shall be considered to be the Independent Medi3 care Advisory Board, the Department of Health 

4 and Human Services, and the relevant commit5 tees of jurisdiction of Congress, including the 

6 Committee on Ways and Means and the Com7 mittee on Energy and Commerce of the House 

8 of Representatives and the Committee on Fi9 nance of the Senate.’’. 

10 (b) GAO STUDY AND REPORT ON DETERMINATION

11 AND IMPLEMENTATION OF PAYMENT AND COVERAGE

12 POLICIES UNDER THE MEDICARE PROGRAM.— 

13 (1) INITIAL STUDY AND REPORT.— 

14 (A) STUDY.—The Comptroller General of 

15 the United States (in this section referred to as 

16 the ‘‘Comptroller General’’) shall conduct a 

17 study on changes to payment policies, meth18 odologies, and rates and coverage policies and 

19 methodologies under the Medicare program 

20 under title XVIII of the Social Security Act as 

21 a result of the recommendations contained in 

22 the proposals made by the Independent Medi23 care Advisory Board under section 1899A of 

24 such Act (as added by subsection (a)), including 


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1 an analysis of the effect of such recommenda2 tions on— 

3 (i) Medicare beneficiary access to pro4 viders and items and services; 

5 (ii) the affordability of Medicare pre6 miums and cost-sharing (including 

7 deductibles, coinsurance, and copayments); 

8 (iii) the potential impact of changes 

9 on other government or private-sector pur10 chasers and payers of care; and 

11 (iv) quality of patient care, including 

12 patient experience, outcomes, and other 

13 measures of care. 

14 (B) REPORT.—Not later than July 1, 

15 2015, the Comptroller General shall submit to 

16 Congress a report containing the results of the 

17 study conducted under subparagraph (A), to18 gether with recommendations for such legisla19 tion and administrative action as the Comp20 troller General determines appropriate. 

21 (2) SUBSEQUENT STUDIES AND REPORTS.—The 

22 Comptroller General shall periodically conduct such 

23 additional studies and submit reports to Congress on 

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1 gies as the Comptroller General determines appro2 priate, in consultation with the Committee on Ways 

3 and Means and the Committee on Energy and Com4 merce of the House of Representatives and the Com5 mittee on Finance of the Senate. 

6 (c) CONFORMING AMENDMENTS.—Section 1805(b) 

7 of the Social Security Act (42 U.S.C. 1395b–6(b)) is 

8 amended— 

9 (1) by redesignating paragraphs (4) through 

10 (8) as paragraphs (5) through (9), respectively; and 

11 (2) by inserting after paragraph (3) the fol12 lowing: 

13 ‘‘(4) REVIEW AND COMMENT ON THE INDE14 PENDENT MEDICARE ADVISORY BOARD OR SECRE15 TARIAL PROPOSAL.—If the Independent Medicare 

16 Advisory Board (as established under subsection (a) 

17 of section 1899A) or the Secretary submits a pro18 posal to the Commission under such section in a 

19 year, the Commission shall review the proposal and, 

20 not later than March 1 of that year, submit to the 

21 Committee on Ways and Means and the Committee 

22 on Energy and Commerce of the House of Rep23 resentatives and the Committee on Finance of the 

24 Senate written comments on such proposal. Such 


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1 comments may include such recommendations as the 

2 Commission deems appropriate.’’. 

3 Subtitle F—Health Care Quality 

4 Improvements 

5 SEC. 3501. HEALTH CARE DELIVERY SYSTEM RESEARCH; 

6 QUALITY IMPROVEMENT TECHNICAL ASSIST7 ANCE. 

8 Part D of title IX of the Public Health Service Act, 

9 as amended by section 3013, is further amended by adding 

10 at the end the following: 

11 ‘‘Subpart II—Health Care Quality Improvement 

12 Programs 

13 ‘‘SEC. 933. HEALTH CARE DELIVERY SYSTEM RESEARCH. 

14 ‘‘(a) PURPOSE.—The purposes of this section are 

15 to— 

16 ‘‘(1) enable the Director to identify, develop, 

17 evaluate, disseminate, and provide training in inno18 vative methodologies and strategies for quality im19 provement practices in the delivery of health care 

20 services that represent best practices (referred to as 

21 ‘best practices’) in health care quality, safety, and 

22 value; and 

23 ‘‘(2) ensure that the Director is accountable for 

24 implementing a model to pursue such research in a 


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1 collaborative manner with other related Federal 

2 agencies. 

3 ‘‘(b) GENERAL FUNCTIONS OF THE CENTER.—The 

4 Center for Quality Improvement and Patient Safety of the 

5 Agency for Healthcare Research and Quality (referred to 

6 in this section as the ‘Center’), or any other relevant agen7 cy or department designated by the Director, shall— 

8 ‘‘(1) carry out its functions using research from 

9 a variety of disciplines, which may include epidemi10 ology, health services, sociology, psychology, human 

11 factors engineering, biostatistics, health economics, 

12 clinical research, and health informatics; 

13 ‘‘(2) conduct or support activities consistent 

14 with the purposes described in subsection (a), and 

15 for— 

16 ‘‘(A) best practices for quality improve17 ment practices in the delivery of health care 

18 services; and 

19 ‘‘(B) that include changes in processes of 

20 care and the redesign of systems used by pro21 viders that will reliably result in intended health 

22 outcomes, improve patient safety, and reduce 

23 medical errors (such as skill development for 

24 health care providers in team-based health care 


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1 delivery and rapid cycle process improvement) 

2 and facilitate adoption of improved workflow; 

3 ‘‘(3) identify health care providers, including 

4 health care systems, single institutions, and indi5 vidual providers, that— 

6 ‘‘(A) deliver consistently high-quality, effi7 cient health care services (as determined by the 

8 Secretary); and 

9 ‘‘(B) employ best practices that are adapt10 able and scalable to diverse health care settings 

11 or effective in improving care across diverse set12 tings; 

13 ‘‘(4) assess research, evidence, and knowledge 

14 about what strategies and methodologies are most 

15 effective in improving health care delivery; 

16 ‘‘(5) find ways to translate such information 

17 rapidly and effectively into practice, and document 

18 the sustainability of those improvements; 

19 ‘‘(6) create strategies for quality improvement 

20 through the development of tools, methodologies, 

21 and interventions that can successfully reduce vari22 ations in the delivery of health care; 

23 ‘‘(7) identify, measure, and improve organiza24 tional, human, or other causative factors, including 

25 those related to the culture and system design of a 


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1 health care organization, that contribute to the suc2 cess and sustainability of specific quality improve3 ment and patient safety strategies; 

4 ‘‘(8) provide for the development of best prac5 tices in the delivery of health care services that— 

6 ‘‘(A) have a high likelihood of success, 

7 based on structured review of empirical evi8 dence; 

9 ‘‘(B) are specified with sufficient detail of 

10 the individual processes, steps, training, skills, 

11 and knowledge required for implementation and 

12 incorporation into workflow of health care prac13 titioners in a variety of settings; 

14 ‘‘(C) are designed to be readily adapted by 

15 health care providers in a variety of settings; 

16 and 

17 ‘‘(D) where applicable, assist health care 

18 providers in working with other health care pro19 viders across the continuum of care and in en20 gaging patients and their families in improving 

21 the care and patient health outcomes; 

22 ‘‘(9) provide for the funding of the activities of 

23 organizations with recognized expertise and excel24 lence in improving the delivery of health care serv25 ices, including children’s health care, by involving 


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1 multiple disciplines, managers of health care entities, 

2 broad development and training, patients, caregivers 

3 and families, and frontline health care workers, in4 cluding activities for the examination of strategies to 

5 share best quality improvement practices and to pro6 mote excellence in the delivery of health care serv7 ices; and 

8 ‘‘(10) build capacity at the State and commu9 nity level to lead quality and safety efforts through 

10 education, training, and mentoring programs to 

11 carry out the activities under paragraphs (1) 

12 through (9). 

13 ‘‘(c) RESEARCH FUNCTIONS OF CENTER.— 

14 ‘‘(1) IN GENERAL.—The Center shall support, 

15 such as through a contract or other mechanism, re16 search on health care delivery system improvement 

17 and the development of tools to facilitate adoption of 

18 best practices that improve the quality, safety, and 

19 efficiency of health care delivery services. Such sup20 port may include establishing a Quality Improve21 ment Network Research Program for the purpose of 

22 testing, scaling, and disseminating of interventions 

23 to improve quality and efficiency in health care. Re24 cipients of funding under the Program may include 


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1 national, State, multi-State, or multi-site quality im2 provement networks. 

3 ‘‘(2) RESEARCH REQUIREMENTS.—The re4 search conducted pursuant to paragraph (1) shall— 

5 ‘‘(A) address the priorities identified by 

6 the Secretary in the national strategic plan es7 tablished under section 399HH; 

8 ‘‘(B) identify areas in which evidence is in9 sufficient to identify strategies and methodolo10 gies, taking into consideration areas of insuffi11 cient evidence identified by the entity with a 

12 contract under section 1890(a) of the Social Se13 curity Act in the report required under section 

14 399JJ; 

15 ‘‘(C) address concerns identified by health 

16 care institutions and providers and commu17 nicated through the Center pursuant to sub18 section (d); 

19 ‘‘(D) reduce preventable morbidity, mor20 tality, and associated costs of morbidity and 

21 mortality by building capacity for patient safety 

22 research; 

23 ‘‘(E) support the discovery of processes for 

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1 eries from clinical research and comparative ef2 fectiveness research; 

3 ‘‘(F) allow communication of research find4 ings and translate evidence into practice rec5 ommendations that are adaptable to a variety 

6 of settings, and which, as soon as practicable 

7 after the establishment of the Center, shall in8 clude— 

9 ‘‘(i) the implementation of a national 

10 application of Intensive Care Unit improve11 ment projects relating to the adult (includ12 ing geriatric), pediatric, and neonatal pa13 tient populations; 

14 ‘‘(ii) practical methods for addressing 

15 health care associated infections, including 

16 Methicillin-Resistant Staphylococcus 

17 Aureus and Vancomycin-Resistant 

18 Entercoccus infections and other emerging 

19 infections; and 

20 ‘‘(iii) practical methods for reducing 

21 preventable hospital admissions and re22 admissions; 

23 ‘‘(G) expand demonstration projects for 

24 improving the quality of children’s health care 

25 and the use of health information technology, 


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1 such as through Pediatric Quality Improvement 

2 Collaboratives and Learning Networks, con3 sistent with provisions of section 1139A of the 

4 Social Security Act for assessing and improving 

5 quality, where applicable; 

6 ‘‘(H) identify and mitigate hazards by— 

7 ‘‘(i) analyzing events reported to pa8 tient safety reporting systems and patient 

9 safety organizations; and 

10 ‘‘(ii) using the results of such analyses 

11 to develop scientific methods of response to 

12 such events; 

13 ‘‘(I) include the conduct of systematic re14 views of existing practices that improve the 

15 quality, safety, and efficiency of health care de16 livery, as well as new research on improving 

17 such practices; and 

18 ‘‘(J) include the examination of how to 

19 measure and evaluate the progress of quality 

20 and patient safety activities. 

21 ‘‘(d) DISSEMINATION OF RESEARCH FINDINGS.— 

22 ‘‘(1) PUBLIC AVAILABILITY.—The Director 

23 shall make the research findings of the Center avail24 able to the public through multiple media and appro25 priate formats to reflect the varying needs of health 


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1 care providers and consumers and diverse levels of 

2 health literacy. 

3 ‘‘(2) LINKAGE TO HEALTH INFORMATION TECH4 NOLOGY.—The Secretary shall ensure that research 

5 findings and results generated by the Center are 

6 shared with the Office of the National Coordinator 

7 of Health Information Technology and used to in8 form the activities of the health information tech9 nology extension program under section 3012, as 

10 well as any relevant standards, certification criteria, 

11 or implementation specifications. 

12 ‘‘(e) PRIORITIZATION.—The Director shall identify 

13 and regularly update a list of processes or systems on 

14 which to focus research and dissemination activities of the 

15 Center, taking into account— 

16 ‘‘(1) the cost to Federal health programs; 

17 ‘‘(2) consumer assessment of health care experi18 ence; 

19 ‘‘(3) provider assessment of such processes or 

20 systems and opportunities to minimize distress and 

21 injury to the health care workforce; 

22 ‘‘(4) the potential impact of such processes or 

23 systems on health status and function of patients, 

24 including vulnerable populations including children; 


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1 ‘‘(5) the areas of insufficient evidence identified 

2 under subsection (c)(2)(B); and 

3 ‘‘(6) the evolution of meaningful use of health 

4 information technology, as defined in section 3000. 

5 ‘‘(f) COORDINATION.—The Center shall coordinate 

6 its activities with activities conducted by the Center for 

7 Medicare and Medicaid Innovation established under sec8 tion 1115A of the Social Security Act. 

9 ‘‘(g) FUNDING.—There is authorized to be appro10 priated to carry out this section $20,000,000 for fiscal 

11 years 2010 through 2014. 

12 ‘‘SEC. 934. QUALITY IMPROVEMENT TECHNICAL ASSIST13 ANCE AND IMPLEMENTATION. 

14 ‘‘(a) IN GENERAL.—The Director, through the Cen15 ter for Quality Improvement and Patient Safety of the 

16 Agency for Healthcare Research and Quality (referred to 

17 in this section as the ‘Center’), shall award— 

18 ‘‘(1) technical assistance grants or contracts to 

19 eligible entities to provide technical support to insti20 tutions that deliver health care and health care pro21 viders (including rural and urban providers of serv22 ices and suppliers with limited infrastructure and fi23 nancial resources to implement and support quality 

24 improvement activities, providers of services and 

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1 viders of services and suppliers for which there are 

2 disparities in care among subgroups of patients) so 

3 that such institutions and providers understand, 

4 adapt, and implement the models and practices iden5 tified in the research conducted by the Center, in6 cluding the Quality Improvement Networks Research 

7 Program; and 

8 ‘‘(2) implementation grants or contracts to eli9 gible entities to implement the models and practices 

10 described under paragraph (1). 

11 ‘‘(b) ELIGIBLE ENTITIES.— 

12 ‘‘(1) TECHNICAL ASSISTANCE AWARD.—To be 

13 eligible to receive a technical assistance grant or 

14 contract under subsection (a)(1), an entity— 

15 ‘‘(A) may be a health care provider, health 

16 care provider association, professional society, 

17 health care worker organization, Indian health 

18 organization, quality improvement organization, 

19 patient safety organization, local quality im20 provement collaborative, the Joint Commission, 

21 academic health center, university, physician22 based research network, primary care extension 

23 program established under section 399W, a 

24 Federal Indian Health Service program or a 

25 health program operated by an Indian tribe (as 


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1 defined in section 4 of the Indian Health Care 

2 Improvement Act), or any other entity identi3 fied by the Secretary; and 

4 ‘‘(B) shall have demonstrated expertise in 

5 providing information and technical support 

6 and assistance to health care providers regard7 ing quality improvement. 

8 ‘‘(2) IMPLEMENTATION AWARD.—To be eligible 

9 to receive an implementation grant or contract 

10 under subsection (a)(2), an entity— 

11 ‘‘(A) may be a hospital or other health 

12 care provider or consortium or providers, as de13 termined by the Secretary; and 

14 ‘‘(B) shall have demonstrated expertise in 

15 providing information and technical support 

16 and assistance to health care providers regard17 ing quality improvement. 

18 ‘‘(c) APPLICATION.— 

19 ‘‘(1) TECHNICAL ASSISTANCE AWARD.—To re20 ceive a technical assistance grant or contract under 

21 subsection (a)(1), an eligible entity shall submit an 

22 application to the Secretary at such time, in such 

23 manner, and containing— 

24 ‘‘(A) a plan for a sustainable business 

25 model that may include a system of— 


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1 ‘‘(i) charging fees to institutions and 

2 providers that receive technical support 

3 from the entity; and 

4 ‘‘(ii) reducing or eliminating such fees 

5 for such institutions and providers that 

6 serve low-income populations; and 

7 ‘‘(B) such other information as the Direc8 tor may require. 

9 ‘‘(2) IMPLEMENTATION AWARD.—To receive a 

10 grant or contract under subsection (a)(2), an eligible 

11 entity shall submit an application to the Secretary at 

12 such time, in such manner, and containing— 

13 ‘‘(A) a plan for implementation of a model 

14 or practice identified in the research conducted 

15 by the Center including— 

16 ‘‘(i) financial cost, staffing require17 ments, and timeline for implementation; 

18 and 

19 ‘‘(ii) pre- and projected post-imple20 mentation quality measure performance 

21 data in targeted improvement areas identi22 fied by the Secretary; and 

23 ‘‘(B) such other information as the Direc24 tor may require. 


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1 ‘‘(d) MATCHING FUNDS.—The Director may not 

2 award a grant or contract under this section to an entity 

3 unless the entity agrees that it will make available (di4 rectly or through contributions from other public or pri5 vate entities) non-Federal contributions toward the activi6 ties to be carried out under the grant or contract in an 

7 amount equal to $1 for each $5 of Federal funds provided 

8 under the grant or contract. Such non-Federal matching 

9 funds may be provided directly or through donations from 

10 public or private entities and may be in cash or in-kind, 

11 fairly evaluated, including plant, equipment, or services. 

12 ‘‘(e) EVALUATION.— 

13 ‘‘(1) IN GENERAL.—The Director shall evaluate 

14 the performance of each entity that receives a grant 

15 or contract under this section. The evaluation of an 

16 entity shall include a study of— 

17 ‘‘(A) the success of such entity in achiev18 ing the implementation, by the health care in19 stitutions and providers assisted by such entity, 

20 of the models and practices identified in the re21 search conducted by the Center under section 

22 933; 

23 ‘‘(B) the perception of the health care in24 stitutions and providers assisted by such entity 

25 regarding the value of the entity; and 


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1 ‘‘(C) where practicable, better patient 

2 health outcomes and lower cost resulting from 

3 the assistance provided by such entity. 

4 ‘‘(2) EFFECT OF EVALUATION.—Based on the 

5 outcome of the evaluation of the entity under para6 graph (1), the Director shall determine whether to 

7 renew a grant or contract with such entity under 

8 this section. 

9 ‘‘(f) COORDINATION.—The entities that receive a 

10 grant or contract under this section shall coordinate with 

11 health information technology regional extension centers 

12 under section 3012(c) and the primary care extension pro13 gram established under section 399W regarding the dis14 semination of quality improvement, system delivery re15 form, and best practices information.’’. 

16 SEC. 3502. ESTABLISHING COMMUNITY HEALTH TEAMS TO 

17 SUPPORT THE PATIENT-CENTERED MEDICAL 

18 HOME. 

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

20 Human Services (referred to in this section as the ‘‘Sec21 retary’’) shall establish a program to provide grants to or 

22 enter into contracts with eligible entities to establish com23 munity-based interdisciplinary, interprofessional teams 

24 (referred to in this section as ‘‘health teams’’) to support 

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1 cology practices, within the hospital service areas served 

2 by the eligible entities. Grants or contracts shall be used 

3 to— 

4 (1) establish health teams to provide support 

5 services to primary care providers; and 

6 (2) provide capitated payments to primary care 

7 providers as determined by the Secretary. 

8 (b) ELIGIBLE ENTITIES.—To be eligible to receive a 

9 grant or contract under subsection (a), an entity shall— 

10 (1)(A) be a State or State-designated entity; or 

11 (B) be an Indian tribe or tribal organization, as 

12 defined in section 4 of the Indian Health Care Im13 provement Act; 

14 (2) submit a plan for achieving long-term finan15 cial sustainability within 3 years; 

16 (3) submit a plan for incorporating prevention 

17 initiatives and patient education and care manage18 ment resources into the delivery of health care that 

19 is integrated with community-based prevention and 

20 treatment resources, where available; 

21 (4) ensure that the health team established by 

22 the entity includes an interdisciplinary, interprofes23 sional team of health care providers, as determined 

24 by the Secretary; such team may include medical 

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1 cians, social workers, behavioral and mental health 

2 providers (including substance use disorder preven3 tion and treatment providers), doctors of chiro4 practic, licensed complementary and alternative med5 icine practitioners, and physicians’ assistants; 

6 (5) agree to provide services to eligible individ7 uals with chronic conditions, as described in section 

8 1945 of the Social Security Act (as added by section 

9 2703), in accordance with the payment methodology 

10 established under subsection (c) of such section; and 

11 (6) submit to the Secretary an application at 

12 such time, in such manner, and containing such in13 formation as the Secretary may require. 

14 (c) REQUIREMENTS FOR HEALTH TEAMS.—A health 

15 team established pursuant to a grant or contract under 

16 subsection (a) shall— 

17 (1) establish contractual agreements with pri18 mary care providers to provide support services; 

19 (2) support patient-centered medical homes, de20 fined as a mode of care that includes— 

21 (A) personal physicians; 

22 (B) whole person orientation; 

23 (C) coordinated and integrated care; 

24 (D) safe and high-quality care through evi25 dence-informed medicine, appropriate use of 


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1 health information technology, and continuous 

2 quality improvements; 

3 (E) expanded access to care; and 

4 (F) payment that recognizes added value 

5 from additional components of patient-centered 

6 care; 

7 (3) collaborate with local primary care providers 

8 and existing State and community based resources 

9 to coordinate disease prevention, chronic disease 

10 management, transitioning between health care pro11 viders and settings and case management for pa12 tients, including children, with priority given to 

13 those amenable to prevention and with chronic dis14 eases or conditions identified by the Secretary; 

15 (4) in collaboration with local health care pro16 viders, develop and implement interdisciplinary, 

17 interprofessional care plans that integrate clinical 

18 and community preventive and health promotion 

19 services for patients, including children, with a pri20 ority given to those amenable to prevention and with 

21 chronic diseases or conditions identified by the Sec22 retary; 

23 (5) incorporate health care providers, patients, 

24 caregivers, and authorized representatives in pro25 gram design and oversight; 


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1 (6) provide support necessary for local primary 

2 care providers to— 

3 (A) coordinate and provide access to high4 quality health care services; 

5 (B) coordinate and provide access to pre6 ventive and health promotion services; 

7 (C) provide access to appropriate specialty 

8 care and inpatient services; 

9 (D) provide quality-driven, cost-effective, 

10 culturally appropriate, and patient- and family11 centered health care; 

12 (E) provide access to pharmacist-delivered 

13 medication management services, including 

14 medication reconciliation; 

15 (F) provide coordination of the appropriate 

16 use of complementary and alternative (CAM) 

17 services to those who request such services; 

18 (G) promote effective strategies for treat19 ment planning, monitoring health outcomes and 

20 resource use, sharing information, treatment 

21 decision support, and organizing care to avoid 

22 duplication of service and other medical man23 agement approaches intended to improve qual24 ity and value of health care services; 


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1 (H) provide local access to the continuum 

2 of health care services in the most appropriate 

3 setting, including access to individuals that im4 plement the care plans of patients and coordi5 nate care, such as integrative health care prac6 titioners; 

7 (I) collect and report data that permits 

8 evaluation of the success of the collaborative ef9 fort on patient outcomes, including collection of 

10 data on patient experience of care, and identi11 fication of areas for improvement; and 

12 (J) establish a coordinated system of early 

13 identification and referral for children at risk 

14 for developmental or behavioral problems such 

15 as through the use of infolines, health informa16 tion technology, or other means as determined 

17 by the Secretary; 

18 (7) provide 24-hour care management and sup19 port during transitions in care settings including— 

20 (A) a transitional care program that pro21 vides onsite visits from the care coordinator, as22 sists with the development of discharge plans 

23 and medication reconciliation upon admission to 

24 and discharge from the hospitals, nursing home, 

25 or other institution setting; 


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1 (B) discharge planning and counseling 

2 support to providers, patients, caregivers, and 

3 authorized representatives; 

4 (C) assuring that post-discharge care plans 

5 include medication management, as appro6 priate; 

7 (D) referrals for mental and behavioral 

8 health services, which may include the use of 

9 infolines; and 

10 (E) transitional health care needs from 

11 adolescence to adulthood; 

12 (8) serve as a liaison to community prevention 

13 and treatment programs; 

14 (9) demonstrate a capacity to implement and 

15 maintain health information technology that meets 

16 the requirements of certified EHR technology (as 

17 defined in section 3000 of the Public Health Service 

18 Act (42 U.S.C. 300jj)) to facilitate coordination 

19 among members of the applicable care team and af20 filiated primary care practices; and 

21 (10) where applicable, report to the Secretary 

22 information on quality measures used under section 

23 399JJ of the Public Health Service Act. 


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1 (d) REQUIREMENT FOR PRIMARY CARE PRO2 VIDERS.—A provider who contracts with a care team 

3 shall— 

4 (1) provide a care plan to the care team for 

5 each patient participant; 

6 (2) provide access to participant health records; 

7 and 

8 (3) meet regularly with the care team to ensure 

9 integration of care. 

10 (e) REPORTING TO SECRETARY.—An entity that re11 ceives a grant or contract under subsection (a) shall sub12 mit to the Secretary a report that describes and evaluates, 

13 as requested by the Secretary, the activities carried out 

14 by the entity under subsection (c). 

15 (f) DEFINITION OF PRIMARY CARE.—In this section, 

16 the term ‘‘primary care’’ means the provision of inte17 grated, accessible health care services by clinicians who 

18 are accountable for addressing a large majority of personal 

19 health care needs, developing a sustained partnership with 

20 patients, and practicing in the context of family and com21 munity. 


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1 SEC. 3503. MEDICATION MANAGEMENT SERVICES IN 

2 TREATMENT OF CHRONIC DISEASE. 

3 Title IX of the Public Health Service Act (42 U.S.C. 

4 299 et seq.), as amended by section 3501, is further 

5 amended by inserting after section 934 the following: 

6 ‘‘SEC. 935. GRANTS OR CONTRACTS TO IMPLEMENT MEDI7 CATION MANAGEMENT SERVICES IN TREAT8 MENT OF CHRONIC DISEASES. 

9 ‘‘(a) IN GENERAL.—The Secretary, acting through 

10 the Patient Safety Research Center established in section 

11 933 (referred to in this section as the ‘Center’), shall es12 tablish a program to provide grants or contracts to eligible 

13 entities to implement medication management (referred to 

14 in this section as ‘MTM’) services provided by licensed 

15 pharmacists, as a collaborative, multidisciplinary, inter16 professional approach to the treatment of chronic diseases 

17 for targeted individuals, to improve the quality of care and 

18 reduce overall cost in the treatment of such diseases. The 

19 Secretary shall commence the program under this section 

20 not later than May 1, 2010. 

21 ‘‘(b) ELIGIBLE ENTITIES.—To be eligible to receive 

22 a grant or contract under subsection (a), an entity shall— 

23 ‘‘(1) provide a setting appropriate for MTM 

24 services, as recommended by the experts described in 

25 subsection (e); 


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1 ‘‘(2) submit to the Secretary a plan for achiev2 ing long-term financial sustainability; 

3 ‘‘(3) where applicable, submit a plan for coordi4 nating MTM services through local community 

5 health teams established in section 3502 of the Pa6 tient Protection and Affordable Care Act or in col7 laboration with primary care extension programs es8 tablished in section 399W; 

9 ‘‘(4) submit a plan for meeting the require10 ments under subsection (c); and 

11 ‘‘(5) submit to the Secretary such other infor12 mation as the Secretary may require. 

13 ‘‘(c) MTM SERVICES TO TARGETED INDIVIDUALS.— 

14 The MTM services provided with the assistance of a grant 

15 or contract awarded under subsection (a) shall, as allowed 

16 by State law including applicable collaborative pharmacy 

17 practice agreements, include— 

18 ‘‘(1) performing or obtaining necessary assess19 ments of the health and functional status of each 

20 patient receiving such MTM services; 

21 ‘‘(2) formulating a medication treatment plan 

22 according to therapeutic goals agreed upon by the 

23 prescriber and the patient or caregiver or authorized 

24 representative of the patient; 


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1 ‘‘(3) selecting, initiating, modifying, recom2 mending changes to, or administering medication 

3 therapy; 

4 ‘‘(4) monitoring, which may include access to, 

5 ordering, or performing laboratory assessments, and 

6 evaluating the response of the patient to therapy, in7 cluding safety and effectiveness; 

8 ‘‘(5) performing an initial comprehensive medi9 cation review to identify, resolve, and prevent medi10 cation-related problems, including adverse drug 

11 events, quarterly targeted medication reviews for on12 going monitoring, and additional followup interven13 tions on a schedule developed collaboratively with 

14 the prescriber; 

15 ‘‘(6) documenting the care delivered and com16 municating essential information about such care, 

17 including a summary of the medication review, and 

18 the recommendations of the pharmacist to other ap19 propriate health care providers of the patient in a 

20 timely fashion; 

21 ‘‘(7) providing education and training designed 

22 to enhance the understanding and appropriate use of 

23 the medications by the patient, caregiver, and other 

24 authorized representative; 


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1 ‘‘(8) providing information, support services, 

2 and resources and strategies designed to enhance 

3 patient adherence with therapeutic regimens; 

4 ‘‘(9) coordinating and integrating MTM serv5 ices within the broader health care management 

6 services provided to the patient; and 

7 ‘‘(10) such other patient care services allowed 

8 under pharmacist scopes of practice in use in other 

9 Federal programs that have implemented MTM 

10 services. 

11 ‘‘(d) TARGETED INDIVIDUALS.—MTM services pro12 vided by licensed pharmacists under a grant or contract 

13 awarded under subsection (a) shall be offered to targeted 

14 individuals who— 

15 ‘‘(1) take 4 or more prescribed medications (in16 cluding over-the-counter medications and dietary 

17 supplements); 

18 ‘‘(2) take any ‘high risk’ medications; 

19 ‘‘(3) have 2 or more chronic diseases, as identi20 fied by the Secretary; or 

21 ‘‘(4) have undergone a transition of care, or 

22 other factors, as determined by the Secretary, that 

23 are likely to create a high risk of medication-related 

24 problems. 


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1 ‘‘(e) CONSULTATION WITH EXPERTS.—In designing 

2 and implementing MTM services provided under grants or 

3 contracts awarded under subsection (a), the Secretary 

4 shall consult with Federal, State, private, public-private, 

5 and academic entities, pharmacy and pharmacist organi6 zations, health care organizations, consumer advocates, 

7 chronic disease groups, and other stakeholders involved 

8 with the research, dissemination, and implementation of 

9 pharmacist-delivered MTM services, as the Secretary de10 termines appropriate. The Secretary, in collaboration with 

11 this group, shall determine whether it is possible to incor12 porate rapid cycle process improvement concepts in use 

13 in other Federal programs that have implemented MTM 

14 services. 

15 ‘‘(f) REPORTING TO THE SECRETARY.—An entity 

16 that receives a grant or contract under subsection (a) shall 

17 submit to the Secretary a report that describes and evalu18 ates, as requested by the Secretary, the activities carried 

19 out under subsection (c), including quality measures en20 dorsed by the entity with a contract under section 1890 

21 of the Social Security Act, as determined by the Secretary. 

22 ‘‘(g) EVALUATION AND REPORT.—The Secretary 

23 shall submit to the relevant committees of Congress a re24 port which shall— 


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1 ‘‘(1) assess the clinical effectiveness of phar2 macist-provided services under the MTM services 

3 program, as compared to usual care, including an 

4 evaluation of whether enrollees maintained better 

5 health with fewer hospitalizations and emergency 

6 room visits than similar patients not enrolled in the 

7 program; 

8 ‘‘(2) assess changes in overall health care re9 source use by targeted individuals; 

10 ‘‘(3) assess patient and prescriber satisfaction 

11 with MTM services; 

12 ‘‘(4) assess the impact of patient-cost sharing 

13 requirements on medication adherence and rec14 ommendations for modifications; 

15 ‘‘(5) identify and evaluate other factors that 

16 may impact clinical and economic outcomes, includ17 ing demographic characteristics, clinical characteris18 tics, and health services use of the patient, as well 

19 as characteristics of the regimen, pharmacy benefit, 

20 and MTM services provided; and 

21 ‘‘(6) evaluate the extent to which participating 

22 pharmacists who maintain a dispensing role have a 

23 conflict of interest in the provision of MTM services, 

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1 tions on how such a conflict might be appropriately 

2 addressed. 

3 ‘‘(h) GRANTS OR CONTRACTS TO FUND DEVELOP4 MENT OF PERFORMANCE MEASURES.—The Secretary 

5 may, through the quality measure development program 

6 under section 931 of the Public Health Service Act, award 

7 grants or contracts to eligible entities for the purpose of 

8 funding the development of performance measures that as9 sess the use and effectiveness of medication therapy man10 agement services.’’. 

11 SEC. 3504. DESIGN AND IMPLEMENTATION OF REGIONAL12 IZED SYSTEMS FOR EMERGENCY CARE. 

13 (a) IN GENERAL.—Title XII of the Public Health 

14 Service Act (42 U.S.C. 300d et seq.) is amended— 

15 (1) in section 1203— 

16 (A) in the section heading, by inserting 

17 ‘‘FOR TRAUMA SYSTEMS’’ after ‘‘GRANTS’’; 

18 and 

19 (B) in subsection (a), by striking ‘‘Admin20 istrator of the Health Resources and Services 

21 Administration’’ and inserting ‘‘Assistant Sec22 retary for Preparedness and Response’’; 

23 (2) by inserting after section 1203 the fol24 lowing: 


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1 ‘‘SEC. 1204. COMPETITIVE GRANTS FOR REGIONALIZED SYS2 TEMS FOR EMERGENCY CARE RESPONSE. 

3 ‘‘(a) IN GENERAL.—The Secretary, acting through 

4 the Assistant Secretary for Preparedness and Response, 

5 shall award not fewer than 4 multiyear contracts or com6 petitive grants to eligible entities to support pilot projects 

7 that design, implement, and evaluate innovative models of 

8 regionalized, comprehensive, and accountable emergency 

9 care and trauma systems. 

10 ‘‘(b) ELIGIBLE ENTITY; REGION.—In this section: 

11 ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en12 tity’ means— 

13 ‘‘(A) a State or a partnership of 1 or more 

14 States and 1 or more local governments; or 

15 ‘‘(B) an Indian tribe (as defined in section 

16 4 of the Indian Health Care Improvement Act) 

17 or a partnership of 1 or more Indian tribes. 

18 ‘‘(2) REGION.—The term ‘region’ means an 

19 area within a State, an area that lies within multiple 

20 States, or a similar area (such as a multicounty 

21 area), as determined by the Secretary. 

22 ‘‘(3) EMERGENCY SERVICES.—The term ‘emer23 gency services’ includes acute, prehospital, and trau24 ma care. 

25 ‘‘(c) PILOT PROJECTS.—The Secretary shall award 

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1 ty that proposes a pilot project to design, implement, and 

2 evaluate an emergency medical and trauma system that— 

3 ‘‘(1) coordinates with public health and safety 

4 services, emergency medical services, medical facili5 ties, trauma centers, and other entities in a region 

6 to develop an approach to emergency medical and 

7 trauma system access throughout the region, includ8 ing 9–1–1 Public Safety Answering Points and 

9 emergency medical dispatch; 

10 ‘‘(2) includes a mechanism, such as a regional 

11 medical direction or transport communications sys12 tem, that operates throughout the region to ensure 

13 that the patient is taken to the medically appro14 priate facility (whether an initial facility or a higher15 level facility) in a timely fashion; 

16 ‘‘(3) allows for the tracking of prehospital and 

17 hospital resources, including inpatient bed capacity, 

18 emergency department capacity, trauma center ca19 pacity, on-call specialist coverage, ambulance diver20 sion status, and the coordination of such tracking 

21 with regional communications and hospital destina22 tion decisions; and 

23 ‘‘(4) includes a consistent region-wide 

24 prehospital, hospital, and interfacility data manage25 ment system that— 


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1 ‘‘(A) submits data to the National EMS 

2 Information System, the National Trauma Data 

3 Bank, and others; 

4 ‘‘(B) reports data to appropriate Federal 

5 and State databanks and registries; and 

6 ‘‘(C) contains information sufficient to 

7 evaluate key elements of prehospital care, hos8 pital destination decisions, including initial hos9 pital and interfacility decisions, and relevant 

10 health outcomes of hospital care. 

11 ‘‘(d) APPLICATION.— 

12 ‘‘(1) IN GENERAL.—An eligible entity that 

13 seeks a contract or grant described in subsection (a) 

14 shall submit to the Secretary an application at such 

15 time and in such manner as the Secretary may re16 quire. 

17 ‘‘(2) APPLICATION INFORMATION.—Each appli18 cation shall include— 

19 ‘‘(A) an assurance from the eligible entity 

20 that the proposed system— 

21 ‘‘(i) has been coordinated with the ap22 plicable State Office of Emergency Medical 

23 Services (or equivalent State office); 

24 ‘‘(ii) includes consistent indirect and 

25 direct medical oversight of prehospital, 


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1 hospital, and interfacility transport 

2 throughout the region; 

3 ‘‘(iii) coordinates prehospital treat4 ment and triage, hospital destination, and 

5 interfacility transport throughout the re6 gion; 

7 ‘‘(iv) includes a categorization or des8 ignation system for special medical facili9 ties throughout the region that is inte10 grated with transport and destination pro11 tocols; 

12 ‘‘(v) includes a regional medical direc13 tion, patient tracking, and resource alloca14 tion system that supports day-to-day emer15 gency care and surge capacity and is inte16 grated with other components of the na17 tional and State emergency preparedness 

18 system; and 

19 ‘‘(vi) addresses pediatric concerns re20 lated to integration, planning, prepared21 ness, and coordination of emergency med22 ical services for infants, children and ado23 lescents; and 

24 ‘‘(B) such other information as the Sec25 retary may require. 


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1 ‘‘(e) REQUIREMENT OF MATCHING FUNDS.— 

2 ‘‘(1) IN GENERAL.—The Secretary may not 

3 make a grant under this section unless the State (or 

4 consortia of States) involved agrees, with respect to 

5 the costs to be incurred by the State (or consortia) 

6 in carrying out the purpose for which such grant 

7 was made, to make available non-Federal contribu8 tions (in cash or in kind under paragraph (2)) to9 ward such costs in an amount equal to not less than 

10 $1 for each $3 of Federal funds provided in the 

11 grant. Such contributions may be made directly or 

12 through donations from public or private entities. 

13 ‘‘(2) NON-FEDERAL CONTRIBUTIONS.—Non14 Federal contributions required in paragraph (1) may 

15 be in cash or in kind, fairly evaluated, including 

16 equipment or services (and excluding indirect or 

17 overhead costs). Amounts provided by the Federal 

18 Government, or services assisted or subsidized to 

19 any significant extent by the Federal Government, 

20 may not be included in determining the amount of 

21 such non-Federal contributions. 

22 ‘‘(f) PRIORITY.—The Secretary shall give priority for 

23 the award of the contracts or grants described in sub24 section (a) to any eligible entity that serves a population 


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1 in a medically underserved area (as defined in section 

2 330(b)(3)). 

3 ‘‘(g) REPORT.—Not later than 90 days after the com4 pletion of a pilot project under subsection (a), the recipi5 ent of such contract or grant described in shall submit 

6 to the Secretary a report containing the results of an eval7 uation of the program, including an identification of— 

8 ‘‘(1) the impact of the regional, accountable 

9 emergency care and trauma system on patient health 

10 outcomes for various critical care categories, such as 

11 trauma, stroke, cardiac emergencies, neurological 

12 emergencies, and pediatric emergencies; 

13 ‘‘(2) the system characteristics that contribute 

14 to the effectiveness and efficiency of the program (or 

15 lack thereof); 

16 ‘‘(3) methods of assuring the long-term finan17 cial sustainability of the emergency care and trauma 

18 system; 

19 ‘‘(4) the State and local legislation necessary to 

20 implement and to maintain the system; 

21 ‘‘(5) the barriers to developing regionalized, ac22 countable emergency care and trauma systems, as 

23 well as the methods to overcome such barriers; and 

24 ‘‘(6) recommendations on the utilization of 

25 available funding for future regionalization efforts. 


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1 ‘‘(h) DISSEMINATION OF FINDINGS.—The Secretary 

2 shall, as appropriate, disseminate to the public and to the 

3 appropriate Committees of the Congress, the information 

4 contained in a report made under subsection (g).’’; and 

5 (3) in section 1232— 

6 (A) in subsection (a), by striking ‘‘appro7 priated’’ and all that follows through the period 

8 at the end and inserting ‘‘appropriated 

9 $24,000,000 for each of fiscal years 2010 

10 through 2014.’’; and 

11 (B) by inserting after subsection (c) the 

12 following: 

13 ‘‘(d) AUTHORITY.—For the purpose of carrying out 

14 parts A through C, beginning on the date of enactment 

15 of the Patient Protection and Affordable Care Act, the 

16 Secretary shall transfer authority in administering grants 

17 and related authorities under such parts from the Admin18 istrator of the Health Resources and Services Administra19 tion to the Assistant Secretary for Preparedness and Re20 sponse.’’. 

21 (b) SUPPORT FOR EMERGENCY MEDICINE RE22 SEARCH.—Part H of title IV of the Public Health Service 

23 Act (42 U.S.C. 289 et seq.) is amended by inserting after 

24 the section 498C the following: 


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1 ‘‘SEC. 498D. SUPPORT FOR EMERGENCY MEDICINE RE2 SEARCH. 

3 ‘‘(a) EMERGENCY MEDICAL RESEARCH.—The Sec4 retary shall support Federal programs administered by the 

5 National Institutes of Health, the Agency for Healthcare 

6 Research and Quality, the Health Resources and Services 

7 Administration, the Centers for Disease Control and Pre8 vention, and other agencies involved in improving the 

9 emergency care system to expand and accelerate research 

10 in emergency medical care systems and emergency medi11 cine, including— 

12 ‘‘(1) the basic science of emergency medicine; 

13 ‘‘(2) the model of service delivery and the com14 ponents of such models that contribute to enhanced 

15 patient health outcomes; 

16 ‘‘(3) the translation of basic scientific research 

17 into improved practice; and 

18 ‘‘(4) the development of timely and efficient de19 livery of health services. 

20 ‘‘(b) PEDIATRIC EMERGENCY MEDICAL RE21 SEARCH.—The Secretary shall support Federal programs 

22 administered by the National Institutes of Health, the 

23 Agency for Healthcare Research and Quality, the Health 

24 Resources and Services Administration, the Centers for 

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1 ical care systems and pediatric emergency medicine, in2 cluding— 

3 ‘‘(1) an examination of the gaps and opportuni4 ties in pediatric emergency care research and a 

5 strategy for the optimal organization and funding of 

6 such research; 

7 ‘‘(2) the role of pediatric emergency services as 

8 an integrated component of the overall health sys9 tem; 

10 ‘‘(3) system-wide pediatric emergency care plan11 ning, preparedness, coordination, and funding; 

12 ‘‘(4) pediatric training in professional edu13 cation; and 

14 ‘‘(5) research in pediatric emergency care, spe15 cifically on the efficacy, safety, and health outcomes 

16 of medications used for infants, children, and adoles17 cents in emergency care settings in order to improve 

18 patient safety. 

19 ‘‘(c) IMPACT RESEARCH.—The Secretary shall sup20 port research to determine the estimated economic impact 

21 of, and savings that result from, the implementation of 

22 coordinated emergency care systems. 

23 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

24 are authorized to be appropriated to carry out this section 


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1 such sums as may be necessary for each of fiscal years 

2 2010 through 2014.’’. 

3 SEC. 3505. TRAUMA CARE CENTERS AND SERVICE AVAIL4 ABILITY. 

5 (a) TRAUMA CARE CENTERS.— 

6 (1) GRANTS FOR TRAUMA CARE CENTERS.— 

7 Section 1241 of the Public Health Service Act (42 

8 U.S.C. 300d–41) is amended by striking subsections 

9 (a) and (b) and inserting the following: 

10 ‘‘(a) IN GENERAL.—The Secretary shall establish 3 

11 programs to award grants to qualified public, nonprofit 

12 Indian Health Service, Indian tribal, and urban Indian 

13 trauma centers— 

14 ‘‘(1) to assist in defraying substantial uncom15 pensated care costs; 

16 ‘‘(2) to further the core missions of such trau17 ma centers, including by addressing costs associated 

18 with patient stabilization and transfer, trauma edu19 cation and outreach, coordination with local and re20 gional trauma systems, essential personnel and other 

21 fixed costs, and expenses associated with employee 

22 and non-employee physician services; and 

23 ‘‘(3) to provide emergency relief to ensure the 

24 continued and future availability of trauma services. 


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1 ‘‘(b) MINIMUM QUALIFICATIONS OF TRAUMA CEN2 TERS.— 

3 ‘‘(1) PARTICIPATION IN TRAUMA CARE SYSTEM

4 OPERATING UNDER CERTAIN PROFESSIONAL GUIDE5 LINES.—Except as provided in paragraph (2), the 

6 Secretary may not award a grant to a trauma center 

7 under subsection (a) unless the trauma center is a 

8 participant in a trauma system that substantially 

9 complies with section 1213. 

10 ‘‘(2) EXEMPTION.—Paragraph (1) shall not 

11 apply to trauma centers that are located in States 

12 with no existing trauma care system. 

13 ‘‘(3) QUALIFICATION FOR SUBSTANTIAL UN14 COMPENSATED CARE COSTS.—The Secretary shall 

15 award substantial uncompensated care grants under 

16 subsection (a)(1) only to trauma centers meeting at 

17 least 1 of the criteria in 1 of the following 3 cat18 egories: 

19 ‘‘(A) CATEGORY A.—The criteria for cat20 egory A are as follows: 

21 ‘‘(i) At least 40 percent of the visits 

22 in the emergency department of the hos23 pital in which the trauma center is located 

24 were charity or self-pay patients. 


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1 ‘‘(ii) At least 50 percent of the visits 

2 in such emergency department were Med3 icaid (under title XIX of the Social Secu4 rity Act (42 U.S.C. 1396 et seq.)) and 

5 charity and self-pay patients combined. 

6 ‘‘(B) CATEGORY B.—The criteria for cat7 egory B are as follows: 

8 ‘‘(i) At least 35 percent of the visits 

9 in the emergency department were charity 

10 or self-pay patients. 

11 ‘‘(ii) At least 50 percent of the visits 

12 in the emergency department were Med13 icaid and charity and self-pay patients 

14 combined. 

15 ‘‘(C) CATEGORY C.—The criteria for cat16 egory C are as follows: 

17 ‘‘(i) At least 20 percent of the visits 

18 in the emergency department were charity 

19 or self-pay patients. 

20 ‘‘(ii) At least 30 percent of the visits 

21 in the emergency department were Med22 icaid and charity and self-pay patients 

23 combined. 

24 ‘‘(4) TRAUMA CENTERS IN 1115 WAIVER

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1 retary may award a substantial uncompensated care 

2 grant to a trauma center under subsection (a)(1) if 

3 the trauma center qualifies for funds under a Low 

4 Income Pool or Safety Net Care Pool established 

5 through a waiver approved under section 1115 of the 

6 Social Security Act (42 U.S.C. 1315). 

7 ‘‘(5) DESIGNATION.—The Secretary may not 

8 award a grant to a trauma center unless such trau9 ma center is verified by the American College of 

10 Surgeons or designated by an equivalent State or 

11 local agency. 

12 ‘‘(c) ADDITIONAL REQUIREMENTS.—The Secretary 

13 may not award a grant to a trauma center under sub14 section (a)(1) unless such trauma center— 

15 ‘‘(1) submits to the Secretary a plan satisfac16 tory to the Secretary that demonstrates a continued 

17 commitment to serving trauma patients regardless of 

18 their ability to pay; and 

19 ‘‘(2) has policies in place to assist patients who 

20 cannot pay for part or all of the care they receive, 

21 including a sliding fee scale, and to ensure fair bill22 ing and collection practices.’’. 

23 (2) CONSIDERATIONS IN MAKING GRANTS.— 

24 Section 1242 of the Public Health Service Act (42 


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1 U.S.C. 300d–42) is amended by striking subsections 

2 (a) and (b) and inserting the following: 

3 ‘‘(a) SUBSTANTIAL UNCOMPENSATED CARE

4 AWARDS.— 

5 ‘‘(1) IN GENERAL.—The Secretary shall estab6 lish an award basis for each eligible trauma center 

7 for grants under section 1241(a)(1) according to the 

8 percentage described in paragraph (2), subject to the 

9 requirements of section 1241(b)(3). 

10 ‘‘(2) PERCENTAGES.—The applicable percent11 ages are as follows: 

12 ‘‘(A) With respect to a category A trauma 

13 center, 100 percent of the uncompensated care 

14 costs. 

15 ‘‘(B) With respect to a category B trauma 

16 center, not more than 75 percent of the uncom17 pensated care costs. 

18 ‘‘(C) With respect to a category C trauma 

19 center, not more than 50 percent of the uncom20 pensated care costs. 

21 ‘‘(b) CORE MISSION AWARDS.— 

22 ‘‘(1) IN GENERAL.—In awarding grants under 

23 section 1241(a)(2), the Secretary shall— 


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1 ‘‘(A) reserve 25 percent of the amount al2 located for core mission awards for Level III 

3 and Level IV trauma centers; and 

4 ‘‘(B) reserve 25 percent of the amount al5 located for core mission awards for large urban 

6 Level I and II trauma centers— 

7 ‘‘(i) that have at least 1 graduate 

8 medical education fellowship in trauma or 

9 trauma related specialties for which de10 mand is exceeding supply; 

11 ‘‘(ii) for which— 

12 ‘‘(I) annual uncompensated care 

13 costs exceed $10,000,000; or 

14 ‘‘(II) at least 20 percent of emer15 gency department visits are charity or 

16 self-pay or Medicaid patients; and 

17 ‘‘(iii) that are not eligible for substan18 tial uncompensated care awards under sec19 tion 1241(a)(1). 

20 ‘‘(c) EMERGENCY AWARDS.—In awarding grants 

21 under section 1241(a)(3), the Secretary shall— 

22 ‘‘(1) give preference to any application sub23 mitted by a trauma center that provides trauma care 

24 in a geographic area in which the availability of 

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1 nificantly decrease if the center is forced to close or 

2 downgrade service or growth in demand for trauma 

3 services exceeds capacity; and 

4 ‘‘(2) reallocate any emergency awards funds not 

5 obligated due to insufficient, or a lack of qualified, 

6 applications to the significant uncompensated care 

7 award program.’’. 

8 (3) CERTAIN AGREEMENTS.—Section 1243 of 

9 the Public Health Service Act (42 U.S.C. 300d–43) 

10 is amended by striking subsections (a), (b), and (c) 

11 and inserting the following: 

12 ‘‘(a) MAINTENANCE OF FINANCIAL SUPPORT.—The 

13 Secretary may require a trauma center receiving a grant 

14 under section 1241(a) to maintain access to trauma serv15 ices at comparable levels to the prior year during the grant 

16 period. 

17 ‘‘(b) TRAUMA CARE REGISTRY.—The Secretary may 

18 require the trauma center receiving a grant under section 

19 1241(a) to provide data to a national and centralized reg20 istry of trauma cases, in accordance with guidelines devel21 oped by the American College of Surgeons, and as the Sec22 retary may otherwise require.’’. 

23 (4) GENERAL PROVISIONS.—Section 1244 of 

24 the Public Health Service Act (42 U.S.C. 300d–44) 


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1 is amended by striking subsections (a), (b), and (c) 

2 and inserting the following: 

3 ‘‘(a) APPLICATION.—The Secretary may not award 

4 a grant to a trauma center under section 1241(a) unless 

5 such center submits an application for the grant to the 

6 Secretary and the application is in such form, is made in 

7 such manner, and contains such agreements, assurances, 

8 and information as the Secretary determines to be nec9 essary to carry out this part. 

10 ‘‘(b) LIMITATION ON DURATION OF SUPPORT.—The 

11 period during which a trauma center receives payments 

12 under a grant under section 1241(a)(3) shall be for 3 fis13 cal years, except that the Secretary may waive such re14 quirement for a center and authorize such center to re15 ceive such payments for 1 additional fiscal year. 

16 ‘‘(c) LIMITATION ON AMOUNT OF GRANT.—Notwith17 standing section 1242(a), a grant under section 1241 may 

18 not be made in an amount exceeding $2,000,000 for each 

19 fiscal year. 

20 ‘‘(d) ELIGIBILITY.—Except as provided in section 

21 1242(b)(1)(B)(iii), acquisition of, or eligibility for, a grant 

22 under section 1241(a) shall not preclude a trauma center 

23 from being eligible for other grants described in such sec24 tion. 


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1 ‘‘(e) FUNDING DISTRIBUTION.—Of the total amount 

2 appropriated for a fiscal year under section 1245, 70 per3 cent shall be used for substantial uncompensated care 

4 awards under section 1241(a)(1), 20 percent shall be used 

5 for core mission awards under section 1241(a)(2), and 10 

6 percent shall be used for emergency awards under section 

7 1241(a)(3). 

8 ‘‘(f) MINIMUM ALLOWANCE.—Notwithstanding sub9 section (e), if the amount appropriated for a fiscal year 

10 under section 1245 is less than $25,000,000, all available 

11 funding for such fiscal year shall be used for substantial 

12 uncompensated care awards under section 1241(a)(1). 

13 ‘‘(g) SUBSTANTIAL UNCOMPENSATED CARE AWARD

14 DISTRIBUTION AND PROPORTIONAL SHARE.—Notwith15 standing section 1242(a), of the amount appropriated for 

16 substantial uncompensated care grants for a fiscal year, 

17 the Secretary shall— 

18 ‘‘(1) make available— 

19 ‘‘(A) 50 percent of such funds for category 

20 A trauma center grantees; 

21 ‘‘(B) 35 percent of such funds for category 

22 B trauma center grantees; and 

23 ‘‘(C) 15 percent of such funds for category 

24 C trauma center grantees; and 


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1 ‘‘(2) provide available funds within each cat2 egory in a manner proportional to the award basis 

3 specified in section 1242(a)(2) to each eligible trau4 ma center. 

5 ‘‘(h) REPORT.—Beginning 2 years after the date of 

6 enactment of the Patient Protection and Affordable Care 

7 Act, and every 2 years thereafter, the Secretary shall bien8 nially report to Congress regarding the status of the 

9 grants made under section 1241 and on the overall finan10 cial stability of trauma centers.’’. 

11 (5) AUTHORIZATION OF APPROPRIATIONS.— 

12 Section 1245 of the Public Health Service Act (42 

13 U.S.C. 300d–45) is amended to read as follows: 

14 ‘‘SEC. 1245. AUTHORIZATION OF APPROPRIATIONS. 

15 ‘‘For the purpose of carrying out this part, there are 

16 authorized to be appropriated $100,000,000 for fiscal year 

17 2009, and such sums as may be necessary for each of fis18 cal years 2010 through 2015. Such authorization of ap19 propriations is in addition to any other authorization of 

20 appropriations or amounts that are available for such pur21 pose.’’. 

22 (6) DEFINITION.—Part D of title XII of the 

23 Public Health Service Act (42 U.S.C. 300d–41 et 

24 seq.) is amended by adding at the end the following: 


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1 ‘‘SEC. 1246. DEFINITION. 

2 ‘‘In this part, the term ‘uncompensated care costs’ 

3 means unreimbursed costs from serving self-pay, charity, 

4 or Medicaid patients, without regard to payment under 

5 section 1923 of the Social Security Act, all of which are 

6 attributable to emergency care and trauma care, including 

7 costs related to subsequent inpatient admissions to the 

8 hospital.’’. 

9 (b) TRAUMA SERVICE AVAILABILITY.—Title XII of 

10 the Public Health Service Act (42 U.S.C. 300d et seq.) 

11 is amended by adding at the end the following: 

12 ‘‘PART H—TRAUMA SERVICE AVAILABILITY 

13 ‘‘SEC. 1281. GRANTS TO STATES. 

14 ‘‘(a) ESTABLISHMENT.—To promote universal access 

15 to trauma care services provided by trauma centers and 

16 trauma-related physician specialties, the Secretary shall 

17 provide funding to States to enable such States to award 

18 grants to eligible entities for the purposes described in this 

19 section. 

20 ‘‘(b) AWARDING OF GRANTS BY STATES.—Each 

21 State may award grants to eligible entities within the 

22 State for the purposes described in subparagraph (d). 

23 ‘‘(c) ELIGIBILITY.— 

24 ‘‘(1) IN GENERAL.—To be eligible to receive a 

25 grant under subsection (b) an entity shall— 

26 ‘‘(A) be— 


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1 ‘‘(i) a public or nonprofit trauma cen2 ter or consortium thereof that meets that 

3 requirements of paragraphs (1), (2), and 

4 (5) of section 1241(b); 

5 ‘‘(ii) a safety net public or nonprofit 

6 trauma center that meets the requirements 

7 of paragraphs (1) through (5) of section 

8 1241(b); or 

9 ‘‘(iii) a hospital in an underserved 

10 area (as defined by the State) that seeks 

11 to establish new trauma services; and 

12 ‘‘(B) submit to the State an application at 

13 such time, in such manner, and containing such 

14 information as the State may require. 

15 ‘‘(2) LIMITATION.—A State shall use at least 

16 40 percent of the amount available to the State 

17 under this part for a fiscal year to award grants to 

18 safety net trauma centers described in paragraph 

19 (1)(A)(ii). 

20 ‘‘(d) USE OF FUNDS.—The recipient of a grant under 

21 subsection (b) shall carry out 1 or more of the following 

22 activities consistent with subsection (b): 

23 ‘‘(1) Providing trauma centers with funding to 

24 support physician compensation in trauma-related 

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1 gion involved, with priority provided to safety net 

2 trauma centers described in subsection (c)(1)(A)(ii). 

3 ‘‘(2) Providing for individual safety net trauma 

4 center fiscal stability and costs related to having 

5 service that is available 24 hours a day, 7 days a 

6 week, with priority provided to safety net trauma 

7 centers described in subsection (c)(1)(A)(ii) located 

8 in urban, border, and rural areas. 

9 ‘‘(3) Reducing trauma center overcrowding at 

10 specific trauma centers related to throughput of 

11 trauma patients. 

12 ‘‘(4) Establishing new trauma services in un13 derserved areas as defined by the State. 

14 ‘‘(5) Enhancing collaboration between trauma 

15 centers and other hospitals and emergency medical 

16 services personnel related to trauma service avail17 ability. 

18 ‘‘(6) Making capital improvements to enhance 

19 access and expedite trauma care, including providing 

20 helipads and associated safety infrastructure. 

21 ‘‘(7) Enhancing trauma surge capacity at spe22 cific trauma centers. 

23 ‘‘(8) Ensuring expedient receipt of trauma pa24 tients transported by ground or air to the appro25 priate trauma center. 


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1 ‘‘(9) Enhancing interstate trauma center col2 laboration. 

3 ‘‘(e) LIMITATION.— 

4 ‘‘(1) IN GENERAL.—A State may use not more 

5 than 20 percent of the amount available to the State 

6 under this part for a fiscal year for administrative 

7 costs associated with awarding grants and related 

8 costs. 

9 ‘‘(2) MAINTENANCE OF EFFORT.—The Sec10 retary may not provide funding to a State under this 

11 part unless the State agrees that such funds will be 

12 used to supplement and not supplant State funding 

13 otherwise available for the activities and costs de14 scribed in this part. 

15 ‘‘(f) DISTRIBUTION OF FUNDS.—The following shall 

16 apply with respect to grants provided in this part: 

17 ‘‘(1) LESS THAN $10,000,000.—If the amount of 

18 appropriations for this part in a fiscal year is less 

19 than $10,000,000, the Secretary shall divide such 

20 funding evenly among only those States that have 1 

21 or more trauma centers eligible for funding under 

22 section 1241(b)(3)(A). 

23 ‘‘(2) LESS THAN $20,000,000.—If the amount of 

24 appropriations in a fiscal year is less than 

25 $20,000,000, the Secretary shall divide such funding 


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1 evenly among only those States that have 1 or more 

2 trauma centers eligible for funding under subpara3 graphs (A) and (B) of section 1241(b)(3). 

4 ‘‘(3) LESS THAN $30,000,000.—If the amount of 

5 appropriations for this part in a fiscal year is less 

6 than $30,000,000, the Secretary shall divide such 

7 funding evenly among only those States that have 1 

8 or more trauma centers eligible for funding under 

9 section 1241(b)(3). 

10 ‘‘(4) $30,000,000 OR MORE.—If the amount of 

11 appropriations for this part in a fiscal year is 

12 $30,000,000 or more, the Secretary shall divide such 

13 funding evenly among all States. 

14 ‘‘SEC. 1282. AUTHORIZATION OF APPROPRIATIONS. 

15 ‘‘For the purpose of carrying out this part, there is 

16 authorized to be appropriated $100,000,000 for each of 

17 fiscal years 2010 through 2015.’’. 

18 SEC. 3506. PROGRAM TO FACILITATE SHARED DECISION19 MAKING. 

20 Part D of title IX of the Public Health Service Act, 

21 as amended by section 3503, is further amended by adding 

22 at the end the following: 


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1 ‘‘SEC. 936. PROGRAM TO FACILITATE SHARED DECISION2 MAKING. 

3 ‘‘(a) PURPOSE.—The purpose of this section is to fa4 cilitate collaborative processes between patients, caregivers 

5 or authorized representatives, and clinicians that engages 

6 the patient, caregiver or authorized representative in deci7 sionmaking, provides patients, caregivers or authorized 

8 representatives with information about trade-offs among 

9 treatment options, and facilitates the incorporation of pa10 tient preferences and values into the medical plan. 

11 ‘‘(b) DEFINITIONS.—In this section: 

12 ‘‘(1) PATIENT DECISION AID.—The term ‘pa13 tient decision aid’ means an educational tool that 

14 helps patients, caregivers or authorized representa15 tives understand and communicate their beliefs and 

16 preferences related to their treatment options, and 

17 to decide with their health care provider what treat18 ments are best for them based on their treatment 

19 options, scientific evidence, circumstances, beliefs, 

20 and preferences. 

21 ‘‘(2) PREFERENCE SENSITIVE CARE.—The term 

22 ‘preference sensitive care’ means medical care for 

23 which the clinical evidence does not clearly support 

24 one treatment option such that the appropriate 

25 course of treatment depends on the values of the pa26 tient or the preferences of the patient, caregivers or 


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1 authorized representatives regarding the benefits, 

2 harms and scientific evidence for each treatment op3 tion, the use of such care should depend on the in4 formed patient choice among clinically appropriate 

5 treatment options. 

6 ‘‘(c) ESTABLISHMENT OF INDEPENDENT STANDARDS

7 FOR PATIENT DECISION AIDS FOR PREFERENCE SEN8 SITIVE CARE.— 

9 ‘‘(1) CONTRACT WITH ENTITY TO ESTABLISH

10 STANDARDS AND CERTIFY PATIENT DECISION

11 AIDS.— 

12 ‘‘(A) IN GENERAL.—For purposes of sup13 porting consensus-based standards for patient 

14 decision aids for preference sensitive care and a 

15 certification process for patient decision aids for 

16 use in the Federal health programs and by 

17 other interested parties, the Secretary shall 

18 have in effect a contract with the entity with a 

19 contract under section 1890 of the Social Secu20 rity Act. Such contract shall provide that the 

21 entity perform the duties described in para22 graph (2). 

23 ‘‘(B) TIMING FOR FIRST CONTRACT.—As 

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1 ment of this section, the Secretary shall enter 

2 into the first contract under subparagraph (A). 

3 ‘‘(C) PERIOD OF CONTRACT.—A contract 

4 under subparagraph (A) shall be for a period of 

5 18 months (except such contract may be re6 newed after a subsequent bidding process). 

7 ‘‘(2) DUTIES.—The following duties are de8 scribed in this paragraph: 

9 ‘‘(A) DEVELOP AND IDENTIFY STANDARDS

10 FOR PATIENT DECISION AIDS.—The entity shall 

11 synthesize evidence and convene a broad range 

12 of experts and key stakeholders to develop and 

13 identify consensus-based standards to evaluate 

14 patient decision aids for preference sensitive 

15 care. 

16 ‘‘(B) ENDORSE PATIENT DECISION AIDS.— 

17 The entity shall review patient decision aids 

18 and develop a certification process whether pa19 tient decision aids meet the standards developed 

20 and identified under subparagraph (A). The en21 tity shall give priority to the review and certifi22 cation of patient decision aids for preference 

23 sensitive care. 


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1 ‘‘(d) PROGRAM TO DEVELOP, UPDATE AND PATIENT

2 DECISION AIDS TO ASSIST HEALTH CARE PROVIDERS

3 AND PATIENTS.— 

4 ‘‘(1) IN GENERAL.—The Secretary, acting 

5 through the Director, and in coordination with heads 

6 of other relevant agencies, such as the Director of 

7 the Centers for Disease Control and Prevention and 

8 the Director of the National Institutes of Health, 

9 shall establish a program to award grants or con10 tracts— 

11 ‘‘(A) to develop, update, and produce pa12 tient decision aids for preference sensitive care 

13 to assist health care providers in educating pa14 tients, caregivers, and authorized representa15 tives concerning the relative safety, relative ef16 fectiveness (including possible health outcomes 

17 and impact on functional status), and relative 

18 cost of treatment or, where appropriate, pallia19 tive care options; 

20 ‘‘(B) to test such materials to ensure such 

21 materials are balanced and evidence based in 

22 aiding health care providers and patients, care23 givers, and authorized representatives to make 

24 informed decisions about patient care and can 


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1 be easily incorporated into a broad array of 

2 practice settings; and 

3 ‘‘(C) to educate providers on the use of 

4 such materials, including through academic cur5 ricula. 

6 ‘‘(2) REQUIREMENTS FOR PATIENT DECISION

7 AIDS.—Patient decision aids developed and produced 

8 pursuant to a grant or contract under paragraph 

9 (1)— 

10 ‘‘(A) shall be designed to engage patients, 

11 caregivers, and authorized representatives in in12 formed decisionmaking with health care pro13 viders; 

14 ‘‘(B) shall present up-to-date clinical evi15 dence about the risks and benefits of treatment 

16 options in a form and manner that is age-ap17 propriate and can be adapted for patients, care18 givers, and authorized representatives from a 

19 variety of cultural and educational backgrounds 

20 to reflect the varying needs of consumers and 

21 diverse levels of health literacy; 

22 ‘‘(C) shall, where appropriate, explain why 

23 there is a lack of evidence to support one treat24 ment option over another; and 


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1 ‘‘(D) shall address health care decisions 

2 across the age span, including those affecting 

3 vulnerable populations including children. 

4 ‘‘(3) DISTRIBUTION.—The Director shall ensure 

5 that patient decision aids produced with grants or 

6 contracts under this section are available to the pub7 lic. 

8 ‘‘(4) NONDUPLICATION OF EFFORTS.—The Di9 rector shall ensure that the activities under this sec10 tion of the Agency and other agencies, including the 

11 Centers for Disease Control and Prevention and the 

12 National Institutes of Health, are free of unneces13 sary duplication of effort. 

14 ‘‘(e) GRANTS TO SUPPORT SHARED DECISION15 MAKING IMPLEMENTATION.— 

16 ‘‘(1) IN GENERAL.—The Secretary shall estab17 lish a program to provide for the phased-in develop18 ment, implementation, and evaluation of shared deci19 sionmaking using patient decision aids to meet the 

20 objective of improving the understanding of patients 

21 of their medical treatment options. 

22 ‘‘(2) SHARED DECISIONMAKING RESOURCE CEN23 TERS.— 

24 ‘‘(A) IN GENERAL.—The Secretary shall 

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1 port of Shared Decisionmaking Resource Cen2 ters (referred to in this subsection as ‘Centers’) 

3 to provide technical assistance to providers and 

4 to develop and disseminate best practices and 

5 other information to support and accelerate 

6 adoption, implementation, and effective use of 

7 patient decision aids and shared decisionmaking 

8 by providers. 

9 ‘‘(B) OBJECTIVES.—The objective of a 

10 Center is to enhance and promote the adoption 

11 of patient decision aids and shared decision12 making through— 

13 ‘‘(i) providing assistance to eligible 

14 providers with the implementation and ef15 fective use of, and training on, patient de16 cision aids; and 

17 ‘‘(ii) the dissemination of best prac18 tices and research on the implementation 

19 and effective use of patient decision aids. 

20 ‘‘(3) SHARED DECISIONMAKING PARTICIPATION

21 GRANTS.— 

22 ‘‘(A) IN GENERAL.—The Secretary shall 

23 provide grants to health care providers for the 

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1 sionmaking techniques and to assess the use of 

2 such techniques. 

3 ‘‘(B) PREFERENCE.—In order to facilitate 

4 the use of best practices, the Secretary shall 

5 provide a preference in making grants under 

6 this subsection to health care providers who 

7 participate in training by Shared Decision8 making Resource Centers or comparable train9 ing. 

10 ‘‘(C) LIMITATION.—Funds under this 

11 paragraph shall not be used to purchase or im12 plement use of patient decision aids other than 

13 those certified under the process identified in 

14 subsection (c). 

15 ‘‘(4) GUIDANCE.—The Secretary may issue 

16 guidance to eligible grantees under this subsection 

17 on the use of patient decision aids. 

18 ‘‘(f) FUNDING.—For purposes of carrying out this 

19 section there are authorized to be appropriated such sums 

20 as may be necessary for fiscal year 2010 and each subse21 quent fiscal year.’’. 

22 SEC. 3507. PRESENTATION OF PRESCRIPTION DRUG BEN23 EFIT AND RISK INFORMATION. 

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

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1 retary’’), acting through the Commissioner of Food and 

2 Drugs, shall determine whether the addition of quan3 titative summaries of the benefits and risks of prescription 

4 drugs in a standardized format (such as a table or drug 

5 facts box) to the promotional labeling or print advertising 

6 of such drugs would improve health care decisionmaking 

7 by clinicians and patients and consumers. 

8 (b) REVIEW AND CONSULTATION.—In making the 

9 determination under subsection (a), the Secretary shall re10 view all available scientific evidence and research on deci11 sionmaking and social and cognitive psychology and con12 sult with drug manufacturers, clinicians, patients and con13 sumers, experts in health literacy, representatives of racial 

14 and ethnic minorities, and experts in women’s and pedi15 atric health. 

16 (c) REPORT.—Not later than 1 year after the date 

17 of enactment of this Act, the Secretary shall submit to 

18 Congress a report that provides— 

19 (1) the determination by the Secretary under 

20 subsection (a); and 

21 (2) the reasoning and analysis underlying that 

22 determination. 

23 (d) AUTHORITY.—If the Secretary determines under 

24 subsection (a) that the addition of quantitative summaries 

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1 ardized format (such as a table or drug facts box) to the 

2 promotional labeling or print advertising of such drugs 

3 would improve health care decisionmaking by clinicians 

4 and patients and consumers, then the Secretary, not later 

5 than 3 years after the date of submission of the report 

6 under subsection (c), shall promulgate proposed regula7 tions as necessary to implement such format. 

8 (e) CLARIFICATION.—Nothing in this section shall be 

9 construed to restrict the existing authorities of the Sec10 retary with respect to benefit and risk information. 

11 SEC. 3508. DEMONSTRATION PROGRAM TO INTEGRATE 

12 QUALITY IMPROVEMENT AND PATIENT SAFE13 TY TRAINING INTO CLINICAL EDUCATION OF 

14 HEALTH PROFESSIONALS. 

15 (a) IN GENERAL.—The Secretary may award grants 

16 to eligible entities or consortia under this section to carry 

17 out demonstration projects to develop and implement aca18 demic curricula that integrates quality improvement and 

19 patient safety in the clinical education of health profes20 sionals. Such awards shall be made on a competitive basis 

21 and pursuant to peer review. 

22 (b) ELIGIBILITY.—To be eligible to receive a grant 

23 under subsection (a), an entity or consortium shall— 


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1 (1) submit to the Secretary an application at 

2 such time, in such manner, and containing such in3 formation as the Secretary may require; 

4 (2) be or include— 

5 (A) a health professions school; 

6 (B) a school of public health; 

7 (C) a school of social work; 

8 (D) a school of nursing; 

9 (E) a school of pharmacy; 

10 (F) an institution with a graduate medical 

11 education program; or 

12 (G) a school of health care administration; 

13 (3) collaborate in the development of curricula 

14 described in subsection (a) with an organization that 

15 accredits such school or institution; 

16 (4) provide for the collection of data regarding 

17 the effectiveness of the demonstration project; and 

18 (5) provide matching funds in accordance with 

19 subsection (c). 

20 (c) MATCHING FUNDS.— 

21 (1) IN GENERAL.—The Secretary may award a 

22 grant to an entity or consortium under this section 

23 only if the entity or consortium agrees to make 

24 available non-Federal contributions toward the costs 

25 of the program to be funded under the grant in an 


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1 amount that is not less than $1 for each $5 of Fed2 eral funds provided under the grant. 

3 (2) DETERMINATION OF AMOUNT CONTRIB4 UTED.—Non-Federal contributions under paragraph 

5 (1) may be in cash or in-kind, fairly evaluated, in6 cluding equipment or services. Amounts provided by 

7 the Federal Government, or services assisted or sub8 sidized to any significant extent by the Federal Gov9 ernment, may not be included in determining the 

10 amount of such contributions. 

11 (d) EVALUATION.—The Secretary shall take such ac12 tion as may be necessary to evaluate the projects funded 

13 under this section and publish, make publicly available, 

14 and disseminate the results of such evaluations on as wide 

15 a basis as is practicable. 

16 (e) REPORTS.—Not later than 2 years after the date 

17 of enactment of this section, and annually thereafter, the 

18 Secretary shall submit to the Committee on Health, Edu19 cation, Labor, and Pensions and the Committee on Fi20 nance of the Senate and the Committee on Energy and 

21 Commerce and the Committee on Ways and Means of the 

22 House of Representatives a report that— 

23 (1) describes the specific projects supported 

24 under this section; and 


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1 (2) contains recommendations for Congress 

2 based on the evaluation conducted under subsection 

3 (d). 

4 SEC. 3509. IMPROVING WOMEN’S HEALTH. 

5 (a) HEALTH AND HUMAN SERVICES OFFICE ON

6 WOMEN’S HEALTH.— 

7 (1) ESTABLISHMENT.—Part A of title II of the 

8 Public Health Service Act (42 U.S.C. 202 et seq.) 

9 is amended by adding at the end the following: 

10 ‘‘SEC. 229. HEALTH AND HUMAN SERVICES OFFICE ON 

11 WOMEN’S HEALTH. 

12 ‘‘(a) ESTABLISHMENT OF OFFICE.—There is estab13 lished within the Office of the Secretary, an Office on 

14 Women’s Health (referred to in this section as the ‘Of15 fice’). The Office shall be headed by a Deputy Assistant 

16 Secretary for Women’s Health who may report to the Sec17 retary. 

18 ‘‘(b) DUTIES.—The Secretary, acting through the Of19 fice, with respect to the health concerns of women, shall— 

20 ‘‘(1) establish short-range and long-range goals 

21 and objectives within the Department of Health and 

22 Human Services and, as relevant and appropriate, 

23 coordinate with other appropriate offices on activi24 ties within the Department that relate to disease 

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1 search, and public and health care professional edu2 cation, for issues of particular concern to women 

3 throughout their lifespan; 

4 ‘‘(2) provide expert advice and consultation to 

5 the Secretary concerning scientific, legal, ethical, 

6 and policy issues relating to women’s health; 

7 ‘‘(3) monitor the Department of Health and 

8 Human Services’ offices, agencies, and regional ac9 tivities regarding women’s health and identify needs 

10 regarding the coordination of activities, including in11 tramural and extramural multidisciplinary activities; 

12 ‘‘(4) establish a Department of Health and 

13 Human Services Coordinating Committee on Wom14 en’s Health, which shall be chaired by the Deputy 

15 Assistant Secretary for Women’s Health and com16 posed of senior level representatives from each of the 

17 agencies and offices of the Department of Health 

18 and Human Services; 

19 ‘‘(5) establish a National Women’s Health In20 formation Center to— 

21 ‘‘(A) facilitate the exchange of information 

22 regarding matters relating to health informa23 tion, health promotion, preventive health serv24 ices, research advances, and education in the 

25 appropriate use of health care; 


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1 ‘‘(B) facilitate access to such information; 

2 ‘‘(C) assist in the analysis of issues and 

3 problems relating to the matters described in 

4 this paragraph; and 

5 ‘‘(D) provide technical assistance with re6 spect to the exchange of information (including 

7 facilitating the development of materials for 

8 such technical assistance); 

9 ‘‘(6) coordinate efforts to promote women’s 

10 health programs and policies with the private sector; 

11 and 

12 ‘‘(7) through publications and any other means 

13 appropriate, provide for the exchange of information 

14 between the Office and recipients of grants, con15 tracts, and agreements under subsection (c), and be16 tween the Office and health professionals and the 

17 general public. 

18 ‘‘(c) GRANTS AND CONTRACTS REGARDING DU19 TIES.— 

20 ‘‘(1) AUTHORITY.—In carrying out subsection 

21 (b), the Secretary may make grants to, and enter 

22 into cooperative agreements, contracts, and inter23 agency agreements with, public and private entities, 

24 agencies, and organizations. 


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1 ‘‘(2) EVALUATION AND DISSEMINATION.—The 

2 Secretary shall directly or through contracts with 

3 public and private entities, agencies, and organiza4 tions, provide for evaluations of projects carried out 

5 with financial assistance provided under paragraph 

6 (1) and for the dissemination of information devel7 oped as a result of such projects. 

8 ‘‘(d) REPORTS.—Not later than 1 year after the date 

9 of enactment of this section, and every second year there10 after, the Secretary shall prepare and submit to the appro11 priate committees of Congress a report describing the ac12 tivities carried out under this section during the period 

13 for which the report is being prepared. 

14 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the 

15 purpose of carrying out this section, there are authorized 

16 to be appropriated such sums as may be necessary for 

17 each of the fiscal years 2010 through 2014.’’. 

18 (2) TRANSFER OF FUNCTIONS.—There are 

19 transferred to the Office on Women’s Health (estab20 lished under section 229 of the Public Health Serv21 ice Act, as added by this section), all functions exer22 cised by the Office on Women’s Health of the Public 

23 Health Service prior to the date of enactment of this 

24 section, including all personnel and compensation 

25 authority, all delegation and assignment authority, 


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1 and all remaining appropriations. All orders, deter2 minations, rules, regulations, permits, agreements, 

3 grants, contracts, certificates, licenses, registrations, 

4 privileges, and other administrative actions that— 

5 (A) have been issued, made, granted, or al6 lowed to become effective by the President, any 

7 Federal agency or official thereof, or by a court 

8 of competent jurisdiction, in the performance of 

9 functions transferred under this paragraph; and 

10 (B) are in effect at the time this section 

11 takes effect, or were final before the date of en12 actment of this section and are to become effec13 tive on or after such date, 

14 shall continue in effect according to their terms until 

15 modified, terminated, superseded, set aside, or re16 voked in accordance with law by the President, the 

17 Secretary, or other authorized official, a court of 

18 competent jurisdiction, or by operation of law. 

19 (b) CENTERS FOR DISEASE CONTROL AND PREVEN20 TION OFFICE OF WOMEN’S HEALTH.—Part A of title III 

21 of the Public Health Service Act (42 U.S.C. 241 et seq.) 

22 is amended by adding at the end the following: 


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1 ‘‘SEC. 310A. CENTERS FOR DISEASE CONTROL AND PREVEN2 TION OFFICE OF WOMEN’S HEALTH. 

3 ‘‘(a) ESTABLISHMENT.—There is established within 

4 the Office of the Director of the Centers for Disease Con5 trol and Prevention, an office to be known as the Office 

6 of Women’s Health (referred to in this section as the ‘Of7 fice’). The Office shall be headed by a director who shall 

8 be appointed by the Director of such Centers. 

9 ‘‘(b) PURPOSE.—The Director of the Office shall— 

10 ‘‘(1) report to the Director of the Centers for 

11 Disease Control and Prevention on the current level 

12 of the Centers’ activity regarding women’s health 

13 conditions across, where appropriate, age, biological, 

14 and sociocultural contexts, in all aspects of the Cen15 ters’ work, including prevention programs, public 

16 and professional education, services, and treatment; 

17 ‘‘(2) establish short-range and long-range goals 

18 and objectives within the Centers for women’s health 

19 and, as relevant and appropriate, coordinate with 

20 other appropriate offices on activities within the 

21 Centers that relate to prevention, research, edu22 cation and training, service delivery, and policy de23 velopment, for issues of particular concern to 

24 women; 

25 ‘‘(3) identify projects in women’s health that 

26 should be conducted or supported by the Centers; 


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1 ‘‘(4) consult with health professionals, non2 governmental organizations, consumer organizations, 

3 women’s health professionals, and other individuals 

4 and groups, as appropriate, on the policy of the Cen5 ters with regard to women; and 

6 ‘‘(5) serve as a member of the Department of 

7 Health and Human Services Coordinating Com8 mittee on Women’s Health (established under sec9 tion 229(b)(4)). 

10 ‘‘(c) DEFINITION.—As used in this section, the term 

11 ‘women’s health conditions’, with respect to women of all 

12 age, ethnic, and racial groups, means diseases, disorders, 

13 and conditions— 

14 ‘‘(1) unique to, significantly more serious for, 

15 or significantly more prevalent in women; and 

16 ‘‘(2) for which the factors of medical risk or 

17 type of medical intervention are different for women, 

18 or for which there is reasonable evidence that indi19 cates that such factors or types may be different for 

20 women. 

21 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—For the 

22 purpose of carrying out this section, there are authorized 

23 to be appropriated such sums as may be necessary for 

24 each of the fiscal years 2010 through 2014.’’. 


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1 (c) OFFICE OF WOMEN’S HEALTH RESEARCH.—Sec2 tion 486(a) of the Public Health Service Act (42 U.S.C. 

3 287d(a)) is amended by inserting ‘‘and who shall report 

4 directly to the Director’’ before the period at the end 

5 thereof. 

6 (d) SUBSTANCE ABUSE AND MENTAL HEALTH

7 SERVICES ADMINISTRATION.—Section 501(f) of the Pub8 lic Health Service Act (42 U.S.C. 290aa(f)) is amended— 

9 (1) in paragraph (1), by inserting ‘‘who shall 

10 report directly to the Administrator’’ before the pe11 riod; 

12 (2) by redesignating paragraph (4) as para13 graph (5); and 

14 (3) by inserting after paragraph (3), the fol15 lowing: 

16 ‘‘(4) OFFICE.—Nothing in this subsection shall 

17 be construed to preclude the Secretary from estab18 lishing within the Substance Abuse and Mental 

19 Health Administration an Office of Women’s 

20 Health.’’. 

21 (e) AGENCY FOR HEALTHCARE RESEARCH AND

22 QUALITY ACTIVITIES REGARDING WOMEN’S HEALTH.— 

23 Part C of title IX of the Public Health Service Act (42 

24 U.S.C. 299c et seq.) is amended— 


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1 (1) by redesignating sections 925 and 926 as 

2 sections 926 and 927, respectively; and 

3 (2) by inserting after section 924 the following: 

4 ‘‘SEC. 925. ACTIVITIES REGARDING WOMEN’S HEALTH. 

5 ‘‘(a) ESTABLISHMENT.—There is established within 

6 the Office of the Director, an Office of Women’s Health 

7 and Gender-Based Research (referred to in this section 

8 as the ‘Office’). The Office shall be headed by a director 

9 who shall be appointed by the Director of Healthcare and 

10 Research Quality. 

11 ‘‘(b) PURPOSE.—The official designated under sub12 section (a) shall— 

13 ‘‘(1) report to the Director on the current 

14 Agency level of activity regarding women’s health, 

15 across, where appropriate, age, biological, and 

16 sociocultural contexts, in all aspects of Agency work, 

17 including the development of evidence reports and 

18 clinical practice protocols and the conduct of re19 search into patient outcomes, delivery of health care 

20 services, quality of care, and access to health care; 

21 ‘‘(2) establish short-range and long-range goals 

22 and objectives within the Agency for research impor23 tant to women’s health and, as relevant and appro24 priate, coordinate with other appropriate offices on 

25 activities within the Agency that relate to health 


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1 services and medical effectiveness research, for 

2 issues of particular concern to women; 

3 ‘‘(3) identify projects in women’s health that 

4 should be conducted or supported by the Agency; 

5 ‘‘(4) consult with health professionals, non6 governmental organizations, consumer organizations, 

7 women’s health professionals, and other individuals 

8 and groups, as appropriate, on Agency policy with 

9 regard to women; and 

10 ‘‘(5) serve as a member of the Department of 

11 Health and Human Services Coordinating Com12 mittee on Women’s Health (established under sec13 tion 229(b)(4)).’’. 

14 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—For the 

15 purpose of carrying out this section, there are authorized 

16 to be appropriated such sums as may be necessary for 

17 each of the fiscal years 2010 through 2014.’’. 

18 (f) HEALTH RESOURCES AND SERVICES ADMINIS19 TRATION OFFICE OF WOMEN’S HEALTH.—Title VII of 

20 the Social Security Act (42 U.S.C. 901 et seq.) is amended 

21 by adding at the end the following: 

22 ‘‘SEC. 713. OFFICE OF WOMEN’S HEALTH. 

23 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab24 lish within the Office of the Administrator of the Health 

25 Resources and Services Administration, an office to be 


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1 known as the Office of Women’s Health. The Office shall 

2 be headed by a director who shall be appointed by the Ad3 ministrator. 

4 ‘‘(b) PURPOSE.—The Director of the Office shall— 

5 ‘‘(1) report to the Administrator on the current 

6 Administration level of activity regarding women’s 

7 health across, where appropriate, age, biological, and 

8 sociocultural contexts; 

9 ‘‘(2) establish short-range and long-range goals 

10 and objectives within the Health Resources and 

11 Services Administration for women’s health and, as 

12 relevant and appropriate, coordinate with other ap13 propriate offices on activities within the Administra14 tion that relate to health care provider training, 

15 health service delivery, research, and demonstration 

16 projects, for issues of particular concern to women; 

17 ‘‘(3) identify projects in women’s health that 

18 should be conducted or supported by the bureaus of 

19 the Administration; 

20 ‘‘(4) consult with health professionals, non21 governmental organizations, consumer organizations, 

22 women’s health professionals, and other individuals 

23 and groups, as appropriate, on Administration policy 

24 with regard to women; and 


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1 ‘‘(5) serve as a member of the Department of 

2 Health and Human Services Coordinating Com3 mittee on Women’s Health (established under sec4 tion 229(b)(4) of the Public Health Service Act). 

5 ‘‘(c) CONTINUED ADMINISTRATION OF EXISTING

6 PROGRAMS.—The Director of the Office shall assume the 

7 authority for the development, implementation, adminis8 tration, and evaluation of any projects carried out through 

9 the Health Resources and Services Administration relat10 ing to women’s health on the date of enactment of this 

11 section. 

12 ‘‘(d) DEFINITIONS.—For purposes of this section: 

13 ‘‘(1) ADMINISTRATION.—The term ‘Administra14 tion’ means the Health Resources and Services Ad15 ministration. 

16 ‘‘(2) ADMINISTRATOR.—The term ‘Adminis17 trator’ means the Administrator of the Health Re18 sources and Services Administration. 

19 ‘‘(3) OFFICE.—The term ‘Office’ means the Of20 fice of Women’s Health established under this sec21 tion in the Administration. 

22 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the 

23 purpose of carrying out this section, there are authorized 

24 to be appropriated such sums as may be necessary for 

25 each of the fiscal years 2010 through 2014.’’. 


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1 (g) FOOD AND DRUG ADMINISTRATION OFFICE OF

2 WOMEN’S HEALTH.—Chapter X of the Federal Food, 

3 Drug, and Cosmetic Act (21 U.S.C. 391 et seq.) is amend4 ed by adding at the end the following: 

5 ‘‘SEC. 1011. OFFICE OF WOMEN’S HEALTH. 

6 ‘‘(a) ESTABLISHMENT.—There is established within 

7 the Office of the Commissioner, an office to be known as 

8 the Office of Women’s Health (referred to in this section 

9 as the ‘Office’). The Office shall be headed by a director 

10 who shall be appointed by the Commissioner of Food and 

11 Drugs. 

12 ‘‘(b) PURPOSE.—The Director of the Office shall— 

13 ‘‘(1) report to the Commissioner of Food and 

14 Drugs on current Food and Drug Administration 

15 (referred to in this section as the ‘Administration’) 

16 levels of activity regarding women’s participation in 

17 clinical trials and the analysis of data by sex in the 

18 testing of drugs, medical devices, and biological 

19 products across, where appropriate, age, biological, 

20 and sociocultural contexts; 

21 ‘‘(2) establish short-range and long-range goals 

22 and objectives within the Administration for issues 

23 of particular concern to women’s health within the 

24 jurisdiction of the Administration, including, where 

25 relevant and appropriate, adequate inclusion of 


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1 women and analysis of data by sex in Administration 

2 protocols and policies; 

3 ‘‘(3) provide information to women and health 

4 care providers on those areas in which differences 

5 between men and women exist; 

6 ‘‘(4) consult with pharmaceutical, biologics, and 

7 device manufacturers, health professionals with ex8 pertise in women’s issues, consumer organizations, 

9 and women’s health professionals on Administration 

10 policy with regard to women; 

11 ‘‘(5) make annual estimates of funds needed to 

12 monitor clinical trials and analysis of data by sex in 

13 accordance with needs that are identified; and 

14 ‘‘(6) serve as a member of the Department of 

15 Health and Human Services Coordinating Com16 mittee on Women’s Health (established under sec17 tion 229(b)(4) of the Public Health Service Act). 

18 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—For the 

19 purpose of carrying out this section, there are authorized 

20 to be appropriated such sums as may be necessary for 

21 each of the fiscal years 2010 through 2014.’’. 

22 (h) NO NEW REGULATORY AUTHORITY.—Nothing in 

23 this section and the amendments made by this section may 

24 be construed as establishing regulatory authority or modi25 fying any existing regulatory authority. 


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1 (i) LIMITATION ON TERMINATION.—Notwithstanding 

2 any other provision of law, a Federal office of women’s 

3 health (including the Office of Research on Women’s 

4 Health of the National Institutes of Health) or Federal 

5 appointive position with primary responsibility over wom6 en’s health issues (including the Associate Administrator 

7 for Women’s Services under the Substance Abuse and 

8 Mental Health Services Administration) that is in exist9 ence on the date of enactment of this section shall not 

10 be terminated, reorganized, or have any of it’s powers or 

11 duties transferred unless such termination, reorganization, 

12 or transfer is approved by Congress through the adoption 

13 of a concurrent resolution of approval. 

14 (j) RULE OF CONSTRUCTION.—Nothing in this sec15 tion (or the amendments made by this section) shall be 

16 construed to limit the authority of the Secretary of Health 

17 and Human Services with respect to women’s health, or 

18 with respect to activities carried out through the Depart19 ment of Health and Human Services on the date of enact20 ment of this section. 

21 SEC. 3510. PATIENT NAVIGATOR PROGRAM. 

22 Section 340A of the Public Health Service Act (42 

23 U.S.C. 256a) is amended— 

24 (1) by striking subsection (d)(3) and inserting 

25 the following: 


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1 ‘‘(3) LIMITATIONS ON GRANT PERIOD.—In car2 rying out this section, the Secretary shall ensure 

3 that the total period of a grant does not exceed 4 

4 years.’’; 

5 (2) in subsection (e), by adding at the end the 

6 following: 

7 ‘‘(3) MINIMUM CORE PROFICIENCIES.—The 

8 Secretary shall not award a grant to an entity under 

9 this section unless such entity provides assurances 

10 that patient navigators recruited, assigned, trained, 

11 or employed using grant funds meet minimum core 

12 proficiencies, as defined by the entity that submits 

13 the application, that are tailored for the main focus 

14 or intervention of the navigator involved.’’; and 

15 (3) in subsection (m)— 

16 (A) in paragraph (1), by striking ‘‘and 

17 $3,500,000 for fiscal year 2010.’’ and inserting 

18 ‘‘$3,500,000 for fiscal year 2010, and such 

19 sums as may be necessary for each of fiscal 

20 years 2011 through 2015.’’; and 

21 (B) in paragraph (2), by striking ‘‘2010’’ 

22 and inserting ‘‘2015’’. 

23 SEC. 3511. AUTHORIZATION OF APPROPRIATIONS. 

24 Except where otherwise provided in this subtitle (or 

25 an amendment made by this subtitle), there is authorized 


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1 to be appropriated such sums as may be necessary to carry 

2 out this subtitle (and such amendments made by this sub3 title). 

4 TITLE IV—PREVENTION OF 

5 CHRONIC DISEASE AND IM6 PROVING PUBLIC HEALTH 

7 Subtitle A—Modernizing Disease 

8 Prevention and Public Health 

9 Systems 

10 SEC. 4001. NATIONAL PREVENTION, HEALTH PROMOTION 

11 AND PUBLIC HEALTH COUNCIL. 

12 (a) ESTABLISHMENT.—The President shall establish, 

13 within the Department of Health and Human Services, 

14 a council to be known as the ‘‘National Prevention, Health 

15 Promotion and Public Health Council’’ (referred to in this 

16 section as the ‘‘Council’’). 

17 (b) CHAIRPERSON.—The President shall appoint the 

18 Surgeon General to serve as the chairperson of the Coun19 cil. 

20 (c) COMPOSITION.—The Council shall be composed 

21 of— 

22 (1) the Secretary of Health and Human Serv23 ices; 

24 (2) the Secretary of Agriculture; 

25 (3) the Secretary of Education; 


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1 (4) the Chairman of the Federal Trade Com2 mission; 

3 (5) the Secretary of Transportation; 

4 (6) the Secretary of Labor; 

5 (7) the Secretary of Homeland Security; 

6 (8) the Administrator of the Environmental 

7 Protection Agency; 

8 (9) the Director of the Office of National Drug 

9 Control Policy; 

10 (10) the Director of the Domestic Policy Coun11 cil; 

12 (11) the Assistant Secretary for Indian Affairs; 

13 (12) the Chairman of the Corporation for Na14 tional and Community Service; and 

15 (13) the head of any other Federal agency that 

16 the chairperson determines is appropriate. 

17 (d) PURPOSES AND DUTIES.—The Council shall— 

18 (1) provide coordination and leadership at the 

19 Federal level, and among all Federal departments 

20 and agencies, with respect to prevention, wellness 

21 and health promotion practices, the public health 

22 system, and integrative health care in the United 

23 States; 

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1 motion, public health, and integrative health care 

2 strategy that incorporates the most effective and 

3 achievable means of improving the health status of 

4 Americans and reducing the incidence of preventable 

5 illness and disability in the United States; 

6 (3) provide recommendations to the President 

7 and Congress concerning the most pressing health 

8 issues confronting the United States and changes in 

9 Federal policy to achieve national wellness, health 

10 promotion, and public health goals, including the re11 duction of tobacco use, sedentary behavior, and poor 

12 nutrition; 

13 (4) consider and propose evidence-based models, 

14 policies, and innovative approaches for the pro15 motion of transformative models of prevention, inte16 grative health, and public health on individual and 

17 community levels across the United States; 

18 (5) establish processes for continual public 

19 input, including input from State, regional, and local 

20 leadership communities and other relevant stake21 holders, including Indian tribes and tribal organiza22 tions; 

23 (6) submit the reports required under sub24 section (g); and 


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1 (7) carry out other activities determined appro2 priate by the President. 

3 (e) MEETINGS.—The Council shall meet at the call 

4 of the Chairperson. 

5 (f) ADVISORY GROUP.— 

6 (1) IN GENERAL.—The President shall establish 

7 an Advisory Group to the Council to be known as 

8 the ‘‘Advisory Group on Prevention, Health Pro9 motion, and Integrative and Public Health’’ (here10 after referred to in this section as the ‘‘Advisory 

11 Group’’). The Advisory Group shall be within the 

12 Department of Health and Human Services and re13 port to the Surgeon General. 

14 (2) COMPOSITION.— 

15 (A) IN GENERAL.—The Advisory Group 

16 shall be composed of not more than 25 non17 Federal members to be appointed by the Presi18 dent. 

19 (B) REPRESENTATION.—In appointing 

20 members under subparagraph (A), the Presi21 dent shall ensure that the Advisory Group in22 cludes a diverse group of licensed health profes23 sionals, including integrative health practi24 tioners who have expertise in— 

25 (i) worksite health promotion; 


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1 (ii) community services, including 

2 community health centers; 

3 (iii) preventive medicine; 

4 (iv) health coaching; 

5 (v) public health education; 

6 (vi) geriatrics; and 

7 (vii) rehabilitation medicine. 

8 (3) PURPOSES AND DUTIES.—The Advisory 

9 Group shall develop policy and program rec10 ommendations and advise the Council on lifestyle11 based chronic disease prevention and management, 

12 integrative health care practices, and health pro13 motion. 

14 (g) NATIONAL PREVENTION AND HEALTH PRO15 MOTION STRATEGY.—Not later than 1 year after the date 

16 of enactment of this Act, the Chairperson, in consultation 

17 with the Council, shall develop and make public a national 

18 prevention, health promotion and public health strategy, 

19 and shall review and revise such strategy periodically. 

20 Such strategy shall— 

21 (1) set specific goals and objectives for improv22 ing the health of the United States through feder23 ally-supported prevention, health promotion, and 

24 public health programs, consistent with ongoing goal 

25 setting efforts conducted by specific agencies; 


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1 (2) establish specific and measurable actions 

2 and timelines to carry out the strategy, and deter3 mine accountability for meeting those timelines, 

4 within and across Federal departments and agencies; 

5 and 

6 (3) make recommendations to improve Federal 

7 efforts relating to prevention, health promotion, pub8 lic health, and integrative health care practices to 

9 ensure Federal efforts are consistent with available 

10 standards and evidence. 

11 (h) REPORT.—Not later than July 1, 2010, and an12 nually thereafter through January 1, 2015, the Council 

13 shall submit to the President and the relevant committees 

14 of Congress, a report that— 

15 (1) describes the activities and efforts on pre16 vention, health promotion, and public health and ac17 tivities to develop a national strategy conducted by 

18 the Council during the period for which the report 

19 is prepared; 

20 (2) describes the national progress in meeting 

21 specific prevention, health promotion, and public 

22 health goals defined in the strategy and further de23 scribes corrective actions recommended by the Coun24 cil and taken by relevant agencies and organizations 

25 to meet these goals; 


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1 (3) contains a list of national priorities on 

2 health promotion and disease prevention to address 

3 lifestyle behavior modification (smoking cessation, 

4 proper nutrition, appropriate exercise, mental health, 

5 behavioral health, substance use disorder, and do6 mestic violence screenings) and the prevention meas7 ures for the 5 leading disease killers in the United 

8 States; 

9 (4) contains specific science-based initiatives to 

10 achieve the measurable goals of Healthy People 

11 2010 regarding nutrition, exercise, and smoking ces12 sation, and targeting the 5 leading disease killers in 

13 the United States; 

14 (5) contains specific plans for consolidating 

15 Federal health programs and Centers that exist to 

16 promote healthy behavior and reduce disease risk 

17 (including eliminating programs and offices deter18 mined to be ineffective in meeting the priority goals 

19 of Healthy People 2010); 

20 (6) contains specific plans to ensure that all 

21 Federal health care programs are fully coordinated 

22 with science-based prevention recommendations by 

23 the Director of the Centers for Disease Control and 

24 Prevention; and 


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1 (7) contains specific plans to ensure that all 

2 non-Department of Health and Human Services pre3 vention programs are based on the science-based 

4 guidelines developed by the Centers for Disease Con5 trol and Prevention under paragraph (4). 

6 (i) PERIODIC REVIEWS.—The Secretary and the 

7 Comptroller General of the United States shall jointly con8 duct periodic reviews, not less than every 5 years, and 

9 evaluations of every Federal disease prevention and health 

10 promotion initiative, program, and agency. Such reviews 

11 shall be evaluated based on effectiveness in meeting 

12 metrics-based goals with an analysis posted on such agen13 cies’ public Internet websites. 

14 SEC. 4002. PREVENTION AND PUBLIC HEALTH FUND. 

15 (a) PURPOSE.—It is the purpose of this section to 

16 establish a Prevention and Public Health Fund (referred 

17 to in this section as the ‘‘Fund’’), to be administered 

18 through the Department of Health and Human Services, 

19 Office of the Secretary, to provide for expanded and sus20 tained national investment in prevention and public health 

21 programs to improve health and help restrain the rate of 

22 growth in private and public sector health care costs. 

23 (b) FUNDING.—There are hereby authorized to be 

24 appropriated, and appropriated, to the Fund, out of any 

25 monies in the Treasury not otherwise appropriated— 


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1 (1) for fiscal year 2010, $500,000,000; 

2 (2) for fiscal year 2011, $750,000,000; 

3 (3) for fiscal year 2012, $1,000,000,000; 

4 (4) for fiscal year 2013, $1,250,000,000; 

5 (5) for fiscal year 2014, $1,500,000,000; and 

6 (6) for fiscal year 2015, and each fiscal year 

7 thereafter, $2,000,000,000. 

8 (c) USE OF FUND.—The Secretary shall transfer 

9 amounts in the Fund to accounts within the Department 

10 of Health and Human Services to increase funding, over 

11 the fiscal year 2008 level, for programs authorized by the 

12 Public Health Service Act, for prevention, wellness, and 

13 public health activities including prevention research and 

14 health screenings, such as the Community Transformation 

15 grant program, the Education and Outreach Campaign for 

16 Preventive Benefits, and immunization programs. 

17 (d) TRANSFER AUTHORITY .—The Committee on Ap18 propriations of the Senate and the Committee on Appro19 priations of the House of Representatives may provide for 

20 the transfer of funds in the Fund to eligible activities 

21 under this section, subject to subsection (c). 

22 SEC. 4003. CLINICAL AND COMMUNITY PREVENTIVE SERV23 ICES. 

24 (a) PREVENTIVE SERVICES TASK FORCE.—Section 

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1 4) is amended by striking subsection (a) and inserting the 

2 following: 

3 ‘‘(a) PREVENTIVE SERVICES TASK FORCE.— 

4 ‘‘(1) ESTABLISHMENT AND PURPOSE.—The Di5 rector shall convene an independent Preventive Serv6 ices Task Force (referred to in this subsection as the 

7 ‘Task Force’) to be composed of individuals with ap8 propriate expertise. Such Task Force shall review 

9 the scientific evidence related to the effectiveness, 

10 appropriateness, and cost-effectiveness of clinical 

11 preventive services for the purpose of developing rec12 ommendations for the health care community, and 

13 updating previous clinical preventive recommenda14 tions, to be published in the Guide to Clinical Pre15 ventive Services (referred to in this section as the 

16 ‘Guide’), for individuals and organizations delivering 

17 clinical services, including primary care profes18 sionals, health care systems, professional societies, 

19 employers, community organizations, non-profit or20 ganizations, Congress and other policy-makers, gov21 ernmental public health agencies, health care quality 

22 organizations, and organizations developing national 

23 health objectives. Such recommendations shall con24 sider clinical preventive best practice recommenda25 tions from the Agency for Healthcare Research and 


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1 Quality, the National Institutes of Health, the Cen2 ters for Disease Control and Prevention, the Insti3 tute of Medicine, specialty medical associations, pa4 tient groups, and scientific societies. 

5 ‘‘(2) DUTIES.—The duties of the Task Force 

6 shall include— 

7 ‘‘(A) the development of additional topic 

8 areas for new recommendations and interven9 tions related to those topic areas, including 

10 those related to specific sub-populations and 

11 age groups; 

12 ‘‘(B) at least once during every 5-year pe13 riod, review interventions and update rec14 ommendations related to existing topic areas, 

15 including new or improved techniques to assess 

16 the health effects of interventions; 

17 ‘‘(C) improved integration with Federal 

18 Government health objectives and related target 

19 setting for health improvement; 

20 ‘‘(D) the enhanced dissemination of rec21 ommendations; 

22 ‘‘(E) the provision of technical assistance 

23 to those health care professionals, agencies and 

24 organizations that request help in implementing 

25 the Guide recommendations; and 


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1 ‘‘(F) the submission of yearly reports to 

2 Congress and related agencies identifying gaps 

3 in research, such as preventive services that re4 ceive an insufficient evidence statement, and 

5 recommending priority areas that deserve fur6 ther examination, including areas related to 

7 populations and age groups not adequately ad8 dressed by current recommendations. 

9 ‘‘(3) ROLE OF AGENCY.—The Agency shall pro10 vide ongoing administrative, research, and technical 

11 support for the operations of the Task Force, includ12 ing coordinating and supporting the dissemination of 

13 the recommendations of the Task Force, ensuring 

14 adequate staff resources, and assistance to those or15 ganizations requesting it for implementation of the 

16 Guide’s recommendations. 

17 ‘‘(4) COORDINATION WITH COMMUNITY PRE18 VENTIVE SERVICES TASK FORCE.—The Task Force 

19 shall take appropriate steps to coordinate its work 

20 with the Community Preventive Services Task Force 

21 and the Advisory Committee on Immunization Prac22 tices, including the examination of how each task 

23 force’s recommendations interact at the nexus of 

24 clinic and community. 


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1 ‘‘(5) OPERATION.—Operation. In carrying out 

2 the duties under paragraph (2), the Task Force is 

3 not subject to the provisions of Appendix 2 of title 

4 5, United States Code. 

5 ‘‘(6) INDEPENDENCE.—All members of the 

6 Task Force convened under this subsection, and any 

7 recommendations made by such members, shall be 

8 independent and, to the extent practicable, not sub9 ject to political pressure. 

10 ‘‘(7) AUTHORIZATION OF APPROPRIATIONS.— 

11 There are authorized to be appropriated such sums 

12 as may be necessary for each fiscal year to carry out 

13 the activities of the Task Force.’’. 

14 (b) COMMUNITY PREVENTIVE SERVICES TASK

15 FORCE.— 

16 (1) IN GENERAL.—Part P of title III of the 

17 Public Health Service Act, as amended by paragraph 

18 (2), is amended by adding at the end the following: 

19 ‘‘SEC. 399U. COMMUNITY PREVENTIVE SERVICES TASK 

20 FORCE. 

21 ‘‘(a) ESTABLISHMENT AND PURPOSE.—The Director 

22 of the Centers for Disease Control and Prevention shall 

23 convene an independent Community Preventive Services 

24 Task Force (referred to in this subsection as the ‘Task 

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1 pertise. Such Task Force shall review the scientific evi2 dence related to the effectiveness, appropriateness, and 

3 cost-effectiveness of community preventive interventions 

4 for the purpose of developing recommendations, to be pub5 lished in the Guide to Community Preventive Services (re6 ferred to in this section as the ‘Guide’), for individuals 

7 and organizations delivering population-based services, in8 cluding primary care professionals, health care systems, 

9 professional societies, employers, community organiza10 tions, non-profit organizations, schools, governmental pub11 lic health agencies, Indian tribes, tribal organizations and 

12 urban Indian organizations, medical groups, Congress and 

13 other policy-makers. Community preventive services in14 clude any policies, programs, processes or activities de15 signed to affect or otherwise affecting health at the popu16 lation level. 

17 ‘‘(b) DUTIES.—The duties of the Task Force shall 

18 include— 

19 ‘‘(1) the development of additional topic areas 

20 for new recommendations and interventions related 

21 to those topic areas, including those related to spe22 cific populations and age groups, as well as the so23 cial, economic and physical environments that can 

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1 ulations and health disparities among sub-popu2 lations and age groups; 

3 ‘‘(2) at least once during every 5-year period, 

4 review interventions and update recommendations 

5 related to existing topic areas, including new or im6 proved techniques to assess the health effects of 

7 interventions, including health impact assessment 

8 and population health modeling; 

9 ‘‘(3) improved integration with Federal Govern10 ment health objectives and related target setting for 

11 health improvement; 

12 ‘‘(4) the enhanced dissemination of rec13 ommendations; 

14 ‘‘(5) the provision of technical assistance to 

15 those health care professionals, agencies, and organi16 zations that request help in implementing the Guide 

17 recommendations; and 

18 ‘‘(6) providing yearly reports to Congress and 

19 related agencies identifying gaps in research and 

20 recommending priority areas that deserve further ex21 amination, including areas related to populations 

22 and age groups not adequately addressed by current 

23 recommendations. 

24 ‘‘(c) ROLE OF AGENCY.—The Director shall provide 

25 ongoing administrative, research, and technical support 


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1 for the operations of the Task Force, including coordi2 nating and supporting the dissemination of the rec3 ommendations of the Task Force, ensuring adequate staff 

4 resources, and assistance to those organizations request5 ing it for implementation of Guide recommendations. 

6 ‘‘(d) COORDINATION WITH PREVENTIVE SERVICES

7 TASK FORCE.—The Task Force shall take appropriate 

8 steps to coordinate its work with the U.S. Preventive Serv9 ices Task Force and the Advisory Committee on Immuni10 zation Practices, including the examination of how each 

11 task force’s recommendations interact at the nexus of clin12 ic and community. 

13 ‘‘(e) OPERATION.—In carrying out the duties under 

14 subsection (b), the Task Force shall not be subject to the 

15 provisions of Appendix 2 of title 5, United States Code. 

16 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated such sums as may be 

18 necessary for each fiscal year to carry out the activities 

19 of the Task Force.’’. 

20 (2) TECHNICAL AMENDMENTS.— 

21 (A) Section 399R of the Public Health 

22 Service Act (as added by section 2 of the ALS 

23 Registry Act (Public Law 110-373; 122 Stat. 

24 4047)) is redesignated as section 399S. 


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1 (B) Section 399R of such Act (as added by 

2 section 3 of the Prenatally and Postnatally Di3 agnosed Conditions Awareness Act (Public Law 

4 110–374; 122 Stat. 4051)) is redesignated as 

5 section 399T. 

6 SEC. 4004. EDUCATION AND OUTREACH CAMPAIGN RE7 GARDING PREVENTIVE BENEFITS. 

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

9 Human Services (referred to in this section as the ‘‘Sec10 retary’’) shall provide for the planning and implementa11 tion of a national public–private partnership for a preven12 tion and health promotion outreach and education cam13 paign to raise public awareness of health improvement 

14 across the life span. Such campaign shall include the dis15 semination of information that— 

16 (1) describes the importance of utilizing preven17 tive services to promote wellness, reduce health dis18 parities, and mitigate chronic disease; 

19 (2) promotes the use of preventive services rec20 ommended by the United States Preventive Services 

21 Task Force and the Community Preventive Services 

22 Task Force; 

23 (3) encourages healthy behaviors linked to the 

24 prevention of chronic diseases; 


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1 (4) explains the preventive services covered 

2 under health plans offered through a Gateway; 

3 (5) describes additional preventive care sup4 ported by the Centers for Disease Control and Pre5 vention, the Health Resources and Services Adminis6 tration, the Substance Abuse and Mental Health 

7 Services Administration, the Advisory Committee on 

8 Immunization Practices, and other appropriate agen9 cies; and 

10 (6) includes general health promotion informa11 tion. 

12 (b) CONSULTATION.—In coordinating the campaign 

13 under subsection (a), the Secretary shall consult with the 

14 Institute of Medicine to provide ongoing advice on evi15 dence-based scientific information for policy, program de16 velopment, and evaluation. 

17 (c) MEDIA CAMPAIGN.— 

18 (1) IN GENERAL.—Not later than 1 year after 

19 the date of enactment of this Act, the Secretary, act20 ing through the Director of the Centers for Disease 

21 Control and Prevention, shall establish and imple22 ment a national science-based media campaign on 

23 health promotion and disease prevention. 

24 (2) REQUIREMENT OF CAMPAIGN.—The cam25 paign implemented under paragraph (1)— 


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1 (A) shall be designed to address proper nu2 trition, regular exercise, smoking cessation, obe3 sity reduction, the 5 leading disease killers in 

4 the United States, and secondary prevention 

5 through disease screening promotion; 

6 (B) shall be carried out through competi7 tively bid contracts awarded to entities pro8 viding for the professional production and de9 sign of such campaign; 

10 (C) may include the use of television, 

11 radio, Internet, and other commercial mar12 keting venues and may be targeted to specific 

13 age groups based on peer-reviewed social re14 search; 

15 (D) shall not be duplicative of any other 

16 Federal efforts relating to health promotion and 

17 disease prevention; and 

18 (E) may include the use of humor and na19 tionally recognized positive role models. 

20 (3) EVALUATION.—The Secretary shall ensure 

21 that the campaign implemented under paragraph (1) 

22 is subject to an independent evaluation every 2 years 

23 and shall report every 2 years to Congress on the ef24 fectiveness of such campaigns towards meeting 

25 science-based metrics. 


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1 (d) WEBSITE.—The Secretary, in consultation with 

2 private-sector experts, shall maintain or enter into a con3 tract to maintain an Internet website to provide science4 based information on guidelines for nutrition, regular ex5 ercise, obesity reduction, smoking cessation, and specific 

6 chronic disease prevention. Such website shall be designed 

7 to provide information to health care providers and con8 sumers. 

9 (e) DISSEMINATION OF INFORMATION THROUGH

10 PROVIDERS.—The Secretary, acting through the Centers 

11 for Disease Control and Prevention, shall develop and im12 plement a plan for the dissemination of health promotion 

13 and disease prevention information consistent with na14 tional priorities, to health care providers who participate 

15 in Federal programs, including programs administered by 

16 the Indian Health Service, the Department of Veterans 

17 Affairs, the Department of Defense, and the Health Re18 sources and Services Administration, and Medicare and 

19 Medicaid. 

20 (f) PERSONALIZED PREVENTION PLANS.— 

21 (1) CONTRACT.—The Secretary, acting through 

22 the Director of the Centers for Disease Control and 

23 Prevention, shall enter into a contract with a quali24 fied entity for the development and operation of a 


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1 Federal Internet website personalized prevention 

2 plan tool. 

3 (2) USE.—The website developed under para4 graph (1) shall be designed to be used as a source 

5 of the most up-to-date scientific evidence relating to 

6 disease prevention for use by individuals. Such 

7 website shall contain a component that enables an 

8 individual to determine their disease risk (based on 

9 personal health and family history, BMI, and other 

10 relevant information) relating to the 5 leading dis11 eases in the United States, and obtain personalized 

12 suggestions for preventing such diseases. 

13 (g) INTERNET PORTAL.—The Secretary shall estab14 lish an Internet portal for accessing risk-assessment tools 

15 developed and maintained by private and academic enti16 ties. 

17 (h) PRIORITY FUNDING.—Funding for the activities 

18 authorized under this section shall take priority over fund19 ing provided through the Centers for Disease Control and 

20 Prevention for grants to States and other entities for simi21 lar purposes and goals as provided for in this section. Not 

22 to exceed $500,000,000 shall be expended on the cam23 paigns and activities required under this section. 

24 (i) PUBLIC AWARENESS OF PREVENTIVE AND OBE25 SITY-RELATED SERVICES.— 


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1 (1) INFORMATION TO STATES.—The Secretary 

2 of Health and Human Services shall provide guid3 ance and relevant information to States and health 

4 care providers regarding preventive and obesity-re5 lated services that are available to Medicaid enroll6 ees, including obesity screening and counseling for 

7 children and adults. 

8 (2) INFORMATION TO ENROLLEES.—Each State 

9 shall design a public awareness campaign to educate 

10 Medicaid enrollees regarding availability and cov11 erage of such services, with the goal of reducing 

12 incidences of obesity. 

13 (3) REPORT.—Not later than January 1, 2011, 

14 and every 3 years thereafter through January 1, 

15 2017, the Secretary of Health and Human Services 

16 shall report to Congress on the status and effective17 ness of efforts under paragraphs (1) and (2), includ18 ing summaries of the States’ efforts to increase 

19 awareness of coverage of obesity-related services. 

20 (j) AUTHORIZATION OF APPROPRIATIONS.—There 

21 are authorized to be appropriated such sums as may be 

22 necessary to carry out this section. 


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1 Subtitle B—Increasing Access to 

2 Clinical Preventive Services 

3 SEC. 4101. SCHOOL-BASED HEALTH CENTERS. 

4 (a) GRANTS FOR THE ESTABLISHMENT OF SCHOOL5 BASED HEALTH CENTERS.— 

6 (1) PROGRAM.—The Secretary of Health and 

7 Human Services (in this subsection referred to as 

8 the ‘‘Secretary’’) shall establish a program to award 

9 grants to eligible entities to support the operation of 

10 school-based health centers. 

11 (2) ELIGIBILITY.—To be eligible for a grant 

12 under this subsection, an entity shall— 

13 (A) be a school-based health center or a 

14 sponsoring facility of a school-based health cen15 ter; and 

16 (B) submit an application at such time, in 

17 such manner, and containing such information 

18 as the Secretary may require, including at a 

19 minimum an assurance that funds awarded 

20 under the grant shall not be used to provide 

21 any service that is not authorized or allowed by 

22 Federal, State, or local law. 

23 (3) PREFERENCE.—In awarding grants under 

24 this section, the Secretary shall give preference to 

25 awarding grants for school-based health centers that 


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1 serve a large population of children eligible for med2 ical assistance under the State Medicaid plan under 

3 title XIX of the Social Security Act or under a waiv4 er of such plan or children eligible for child health 

5 assistance under the State child health plan under 

6 title XXI of that Act (42 U.S.C. 1397aa et seq.). 

7 (4) LIMITATION ON USE OF FUNDS.—An eligi8 ble entity shall use funds provided under a grant 

9 awarded under this subsection only for expenditures 

10 for facilities (including the acquisition or improve11 ment of land, or the acquisition, construction, expan12 sion, replacement, or other improvement of any 

13 building or other facility), equipment, or similar ex14 penditures, as specified by the Secretary. No funds 

15 provided under a grant awarded under this section 

16 shall be used for expenditures for personnel or to 

17 provide health services. 

18 (5) APPROPRIATIONS.—Out of any funds in the 

19 Treasury not otherwise appropriated, there is appro20 priated for each of fiscal years 2010 through 2013, 

21 $50,000,000 for the purpose of carrying out this 

22 subsection. Funds appropriated under this para23 graph shall remain available until expended. 

24 (6) DEFINITIONS.—In this subsection, the 

25 terms ‘‘school-based health center’’ and ‘‘sponsoring 


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1 facility’’ have the meanings given those terms in sec2 tion 2110(c)(9) of the Social Security Act (42 

3 U.S.C. 1397jj(c)(9)). 

4 (b) GRANTS FOR THE OPERATION OF SCHOOL-BASED

5 HEALTH CENTERS.—Part Q of title III of the Public 

6 Health Service Act (42 U.S.C. 280h et seq.) is amended 

7 by adding at the end the following: 

8 ‘‘SEC. 399Z–1. SCHOOL-BASED HEALTH CENTERS. 

9 ‘‘(a) DEFINITIONS; ESTABLISHMENT OF CRITERIA.— 

10 In this section: 

11 ‘‘(1) COMPREHENSIVE PRIMARY HEALTH SERV12 ICES.—The term ‘comprehensive primary health 

13 services’ means the core services offered by school14 based health centers, which shall include the fol15 lowing: 

16 ‘‘(A) PHYSICAL.—Comprehensive health 

17 assessments, diagnosis, and treatment of minor, 

18 acute, and chronic medical conditions, and re19 ferrals to, and follow-up for, specialty care and 

20 oral health services. 

21 ‘‘(B) MENTAL HEALTH.—Mental health 

22 and substance use disorder assessments, crisis 

23 intervention, counseling, treatment, and referral 

24 to a continuum of services including emergency 


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1 psychiatric care, community support programs, 

2 inpatient care, and outpatient programs. 

3 ‘‘(2) MEDICALLY UNDERSERVED CHILDREN

4 AND ADOLESCENTS.— 

5 ‘‘(A) IN GENERAL.—The term ‘medically 

6 underserved children and adolescents’ means a 

7 population of children and adolescents who are 

8 residents of an area designated as a medically 

9 underserved area or a health professional short10 age area by the Secretary. 

11 ‘‘(B) CRITERIA.—The Secretary shall pre12 scribe criteria for determining the specific 

13 shortages of personal health services for medi14 cally underserved children and adolescents 

15 under subparagraph (A) that shall— 

16 ‘‘(i) take into account any comments 

17 received by the Secretary from the chief 

18 executive officer of a State and local offi19 cials in a State; and 

20 ‘‘(ii) include factors indicative of the 

21 health status of such children and adoles22 cents of an area, including the ability of 

23 the residents of such area to pay for health 

24 services, the accessibility of such services, 

25 the availability of health professionals to 


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1 such children and adolescents, and other 

2 factors as determined appropriate by the 

3 Secretary. 

4 ‘‘(3) SCHOOL-BASED HEALTH CENTER.—The 

5 term ‘school-based health center’ means a health 

6 clinic that— 

7 ‘‘(A) meets the definition of a school-based 

8 health center under section 2110(c)(9)(A) of 

9 the Social Security Act and is administered by 

10 a sponsoring facility (as defined in section 

11 2110(c)(9)(B) of the Social Security Act); 

12 ‘‘(B) provides, at a minimum, comprehen13 sive primary health services during school hours 

14 to children and adolescents by health profes15 sionals in accordance with established stand16 ards, community practice, reporting laws, and 

17 other State laws, including parental consent 

18 and notification laws that are not inconsistent 

19 with Federal law; and 

20 ‘‘(C) does not perform abortion services. 

21 ‘‘(b) AUTHORITY TO AWARD GRANTS.—The Sec22 retary shall award grants for the costs of the operation 

23 of school-based health centers (referred to in this section 

24 as ‘SBHCs’) that meet the requirements of this section. 


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1 ‘‘(c) APPLICATIONS.—To be eligible to receive a grant 

2 under this section, an entity shall— 

3 ‘‘(1) be an SBHC (as defined in subsection 

4 (a)(3)); and 

5 ‘‘(2) submit to the Secretary an application at 

6 such time, in such manner, and containing— 

7 ‘‘(A) evidence that the applicant meets all 

8 criteria necessary to be designated an SBHC; 

9 ‘‘(B) evidence of local need for the services 

10 to be provided by the SBHC; 

11 ‘‘(C) an assurance that— 

12 ‘‘(i) SBHC services will be provided to 

13 those children and adolescents for whom 

14 parental or guardian consent has been ob15 tained in cooperation with Federal, State, 

16 and local laws governing health care serv17 ice provision to children and adolescents; 

18 ‘‘(ii) the SBHC has made and will 

19 continue to make every reasonable effort to 

20 establish and maintain collaborative rela21 tionships with other health care providers 

22 in the catchment area of the SBHC; 

23 ‘‘(iii) the SBHC will provide on-site 

24 access during the academic day when 

25 school is in session and 24-hour coverage 


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1 through an on-call system and through its 

2 backup health providers to ensure access to 

3 services on a year-round basis when the 

4 school or the SBHC is closed; 

5 ‘‘(iv) the SBHC will be integrated into 

6 the school environment and will coordinate 

7 health services with school personnel, such 

8 as administrators, teachers, nurses, coun9 selors, and support personnel, as well as 

10 with other community providers co-located 

11 at the school; 

12 ‘‘(v) the SBHC sponsoring facility as13 sumes all responsibility for the SBHC ad14 ministration, operations, and oversight; 

15 and 

16 ‘‘(vi) the SBHC will comply with Fed17 eral, State, and local laws concerning pa18 tient privacy and student records, includ19 ing regulations promulgated under the 

20 Health Insurance Portability and Account21 ability Act of 1996 and section 444 of the 

22 General Education Provisions Act; and 

23 ‘‘(D) such other information as the Sec24 retary may require. 


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1 ‘‘(d) PREFERENCES AND CONSIDERATION.—In re2 viewing applications: 

3 ‘‘(1) The Secretary may give preference to ap4 plicants who demonstrate an ability to serve the fol5 lowing: 

6 ‘‘(A) Communities that have evidenced 

7 barriers to primary health care and mental 

8 health and substance use disorder prevention 

9 services for children and adolescents. 

10 ‘‘(B) Communities with high per capita 

11 numbers of children and adolescents who are 

12 uninsured, underinsured, or enrolled in public 

13 health insurance programs. 

14 ‘‘(C) Populations of children and adoles15 cents that have historically demonstrated dif16 ficulty in accessing health and mental health 

17 and substance use disorder prevention services. 

18 ‘‘(2) The Secretary may give consideration to 

19 whether an applicant has received a grant under 

20 subsection (a) of section 4101 of the Patient Protec21 tion and Affordable Care Act. 

22 ‘‘(e) WAIVER OF REQUIREMENTS.—The Secretary 

23 may— 

24 ‘‘(1) under appropriate circumstances, waive 

25 the application of all or part of the requirements of 


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1 this subsection with respect to an SBHC for not to 

2 exceed 2 years; and 

3 ‘‘(2) upon a showing of good cause, waive the 

4 requirement that the SBHC provide all required 

5 comprehensive primary health services for a des6 ignated period of time to be determined by the Sec7 retary. 

8 ‘‘(f) USE OF FUNDS.— 

9 ‘‘(1) FUNDS.—Funds awarded under a grant 

10 under this section— 

11 ‘‘(A) may be used for— 

12 ‘‘(i) acquiring and leasing equipment 

13 (including the costs of amortizing the prin14 ciple of, and paying interest on, loans for 

15 such equipment); 

16 ‘‘(ii) providing training related to the 

17 provision of required comprehensive pri18 mary health services and additional health 

19 services; 

20 ‘‘(iii) the management and operation 

21 of health center programs; 

22 ‘‘(iv) the payment of salaries for phy23 sicians, nurses, and other personnel of the 

24 SBHC; and 

25 ‘‘(B) may not be used to provide abortions. 


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1 ‘‘(2) CONSTRUCTION.—The Secretary may 

2 award grants which may be used to pay the costs as3 sociated with expanding and modernizing existing 

4 buildings for use as an SBHC, including the pur5 chase of trailers or manufactured buildings to install 

6 on the school property. 

7 ‘‘(3) LIMITATIONS.— 

8 ‘‘(A) IN GENERAL.—Any provider of serv9 ices that is determined by a State to be in viola10 tion of a State law described in subsection 

11 (a)(3)(B) with respect to activities carried out 

12 at a SBHC shall not be eligible to receive addi13 tional funding under this section. 

14 ‘‘(B) NO OVERLAPPING GRANT PERIOD.— 

15 No entity that has received funding under sec16 tion 330 for a grant period shall be eligible for 

17 a grant under this section for with respect to 

18 the same grant period. 

19 ‘‘(g) MATCHING REQUIREMENT.— 

20 ‘‘(1) IN GENERAL.—Each eligible entity that re21 ceives a grant under this section shall provide, from 

22 non-Federal sources, an amount equal to 20 percent 

23 of the amount of the grant (which may be provided 

24 in cash or in-kind) to carry out the activities sup25 ported by the grant. 


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1 ‘‘(2) WAIVER.—The Secretary may waive all or 

2 part of the matching requirement described in para3 graph (1) for any fiscal year for the SBHC if the 

4 Secretary determines that applying the matching re5 quirement to the SBHC would result in serious 

6 hardship or an inability to carry out the purposes of 

7 this section. 

8 ‘‘(h) SUPPLEMENT, NOT SUPPLANT.—Grant funds 

9 provided under this section shall be used to supplement, 

10 not supplant, other Federal or State funds. 

11 ‘‘(i) EVALUATION.—The Secretary shall develop and 

12 implement a plan for evaluating SBHCs and monitoring 

13 quality performance under the awards made under this 

14 section. 

15 ‘‘(j) AGE APPROPRIATE SERVICES.—An eligible enti16 ty receiving funds under this section shall only provide age 

17 appropriate services through a SBHC funded under this 

18 section to an individual. 

19 ‘‘(k) PARENTAL CONSENT.—An eligible entity receiv20 ing funds under this section shall not provide services 

21 through a SBHC funded under this section to an indi22 vidual without the consent of the parent or guardian of 

23 such individual if such individual is considered a minor 

24 under applicable State law. 


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1 ‘‘(l) AUTHORIZATION OF APPROPRIATIONS.—For 

2 purposes of carrying out this section, there are authorized 

3 to be appropriated such sums as may be necessary for 

4 each of the fiscal years 2010 through 2014.’’. 

5 SEC. 4102. ORAL HEALTHCARE PREVENTION ACTIVITIES. 

6 (a) IN GENERAL.—Title III of the Public Health 

7 Service Act (42 U.S.C. 241 et seq.), as amended by section 

8 3025, is amended by adding at the end the following: 

9 ‘‘PART T—ORAL HEALTHCARE PREVENTION 

10 ACTIVITIES 

11 ‘‘SEC. 399LL. ORAL HEALTHCARE PREVENTION EDUCATION 

12 CAMPAIGN. 

13 ‘‘(a) ESTABLISHMENT.—The Secretary, acting 

14 through the Director of the Centers for Disease Control 

15 and Prevention and in consultation with professional oral 

16 health organizations, shall, subject to the availability of 

17 appropriations, establish a 5-year national, public edu18 cation campaign (referred to in this section as the ‘cam19 paign’) that is focused on oral healthcare prevention and 

20 education, including prevention of oral disease such as 

21 early childhood and other caries, periodontal disease, and 

22 oral cancer. 

23 ‘‘(b) REQUIREMENTS.—In establishing the campaign, 

24 the Secretary shall— 


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1 ‘‘(1) ensure that activities are targeted towards 

2 specific populations such as children, pregnant 

3 women, parents, the elderly, individuals with disabil4 ities, and ethnic and racial minority populations, in5 cluding Indians, Alaska Natives and Native Hawai6 ians (as defined in section 4(c) of the Indian Health 

7 Care Improvement Act) in a culturally and linguis8 tically appropriate manner; and 

9 ‘‘(2) utilize science-based strategies to convey 

10 oral health prevention messages that include, but are 

11 not limited to, community water fluoridation and 

12 dental sealants. 

13 ‘‘(c) PLANNING AND IMPLEMENTATION.—Not later 

14 than 2 years after the date of enactment of this section, 

15 the Secretary shall begin implementing the 5-year cam16 paign. During the 2-year period referred to in the previous 

17 sentence, the Secretary shall conduct planning activities 

18 with respect to the campaign. 

19 ‘‘SEC. 399LL-1. RESEARCH-BASED DENTAL CARIES DISEASE 

20 MANAGEMENT. 

21 ‘‘(a) IN GENERAL.—The Secretary, acting through 

22 the Director of the Centers for Disease Control and Pre23 vention, shall award demonstration grants to eligible enti24 ties to demonstrate the effectiveness of research-based 

25 dental caries disease management activities. 


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1 ‘‘(b) ELIGIBILITY.—To be eligible for a grant under 

2 this section, an entity shall— 

3 ‘‘(1) be a community-based provider of dental 

4 services (as defined by the Secretary), including a 

5 Federally-qualified health center, a clinic of a hos6 pital owned or operated by a State (or by an instru7 mentality or a unit of government within a State), 

8 a State or local department of health, a dental pro9 gram of the Indian Health Service, an Indian tribe 

10 or tribal organization, or an urban Indian organiza11 tion (as such terms are defined in section 4 of the 

12 Indian Health Care Improvement Act), a health sys13 tem provider, a private provider of dental services, 

14 medical, dental, public health, nursing, nutrition 

15 educational institutions, or national organizations in16 volved in improving children’s oral health; and 

17 ‘‘(2) submit to the Secretary an application at 

18 such time, in such manner, and containing such in19 formation as the Secretary may require. 

20 ‘‘(c) USE OF FUNDS.—A grantee shall use amounts 

21 received under a grant under this section to demonstrate 

22 the effectiveness of research-based dental caries disease 

23 management activities. 

24 ‘‘(d) USE OF INFORMATION.—The Secretary shall 

25 utilize information generated from grantees under this 


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1 section in planning and implementing the public education 

2 campaign under section 399LL. 

3 ‘‘SEC. 399LL-2. AUTHORIZATION OF APPROPRIATIONS. 

4 ‘‘There is authorized to be appropriated to carry out 

5 this part, such sums as may be necessary.’’. 

6 (b) SCHOOL-BASED SEALANT PROGRAMS.—Section 

7 317M(c)(1) of the Public Health Service Act (42 U.S.C. 

8 247b-14(c)(1)) is amended by striking ‘‘may award grants 

9 to States and Indian tribes’’ and inserting ‘‘shall award 

10 a grant to each of the 50 States and territories and to 

11 Indians, Indian tribes, tribal organizations and urban In12 dian organizations (as such terms are defined in section 

13 4 of the Indian Health Care Improvement Act)’’. 

14 (c) ORAL HEALTH INFRASTRUCTURE.—Section 

15 317M of the Public Health Service Act (42 U.S.C. 247b16 14) is amended— 

17 (1) by redesignating subsections (d) and (e) as 

18 subsections (e) and (f), respectively; and 

19 (2) by inserting after subsection (c), the fol20 lowing: 

21 ‘‘(d) ORAL HEALTH INFRASTRUCTURE.— 

22 ‘‘(1) COOPERATIVE AGREEMENTS.—The Sec23 retary, acting through the Director of the Centers 

24 for Disease Control and Prevention, shall enter into 

25 cooperative agreements with State, territorial, and 


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1 Indian tribes or tribal organizations (as those terms 

2 are defined in section 4 of the Indian Health Care 

3 Improvement Act) to establish oral health leadership 

4 and program guidance, oral health data collection 

5 and interpretation, (including determinants of poor 

6 oral health among vulnerable populations), a multi7 dimensional delivery system for oral health, and to 

8 implement science-based programs (including dental 

9 sealants and community water fluoridation) to im10 prove oral health. 

11 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.— 

12 There is authorized to be appropriated such sums as 

13 necessary to carry out this subsection for fiscal years 

14 2010 through 2014.’’. 

15 (d) UPDATING NATIONAL ORAL HEALTHCARE SUR16 VEILLANCE ACTIVITIES.— 

17 (1) PRAMS.— 

18 (A) IN GENERAL.—The Secretary of 

19 Health and Human Services (referred to in this 

20 subsection as the ‘‘Secretary’’) shall carry out 

21 activities to update and improve the Pregnancy 

22 Risk Assessment Monitoring System (referred 

23 to in this section as ‘‘PRAMS’’) as it relates to 

24 oral healthcare. 


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1 (B) STATE REPORTS AND MANDATORY

2 MEASUREMENTS.— 

3 (i) IN GENERAL.—Not later than 5 

4 years after the date of enactment of this 

5 Act, and every 5 years thereafter, a State 

6 shall submit to the Secretary a report con7 cerning activities conducted within the 

8 State under PRAMS. 

9 (ii) MEASUREMENTS.—The oral 

10 healthcare measurements developed by the 

11 Secretary for use under PRAMS shall be 

12 mandatory with respect to States for pur13 poses of the State reports under clause (i). 

14 (C) FUNDING.—There is authorized to be 

15 appropriated to carry out this paragraph, such 

16 sums as may be necessary. 

17 (2) NATIONAL HEALTH AND NUTRITION EXAM18 INATION SURVEY.—The Secretary shall develop oral 

19 healthcare components that shall include tooth-level 

20 surveillance for inclusion in the National Health and 

21 Nutrition Examination Survey. Such components 

22 shall be updated by the Secretary at least every 6 

23 years. For purposes of this paragraph, the term 

24 ‘‘tooth-level surveillance’’ means a clinical examina25 tion where an examiner looks at each dental surface, 


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1 on each tooth in the mouth and as expanded by the 

2 Division of Oral Health of the Centers for Disease 

3 Control and Prevention. 

4 (3) MEDICAL EXPENDITURES PANEL SURVEY.— 

5 The Secretary shall ensure that the Medical Expend6 itures Panel Survey by the Agency for Healthcare 

7 Research and Quality includes the verification of 

8 dental utilization, expenditure, and coverage findings 

9 through conduct of a look-back analysis. 

10 (4) NATIONAL ORAL HEALTH SURVEILLANCE

11 SYSTEM.— 

12 (A) APPROPRIATIONS.—There is author13 ized to be appropriated, such sums as may be 

14 necessary for each of fiscal years 2010 through 

15 2014 to increase the participation of States in 

16 the National Oral Health Surveillance System 

17 from 16 States to all 50 States, territories, and 

18 District of Columbia. 

19 (B) REQUIREMENTS.—The Secretary shall 

20 ensure that the National Oral Health Surveil21 lance System include the measurement of early 

22 childhood caries. 


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1 SEC. 4103. MEDICARE COVERAGE OF ANNUAL WELLNESS 

2 VISIT PROVIDING A PERSONALIZED PREVEN3 TION PLAN. 

4 (a) COVERAGE OF PERSONALIZED PREVENTION

5 PLAN SERVICES.— 

6 (1) IN GENERAL.—Section 1861(s)(2) of the 

7 Social Security Act (42 U.S.C. 1395x(s)(2)) is 

8 amended— 

9 (A) in subparagraph (DD), by striking 

10 ‘‘and’’ at the end; 

11 (B) in subparagraph (EE), by adding 

12 ‘‘and’’ at the end; and 

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

14 subparagraph: 

15 ‘‘(FF) personalized prevention plan services (as 

16 defined in subsection (hhh));’’. 

17 (2) CONFORMING AMENDMENTS.—Clauses (i) 

18 and (ii) of section 1861(s)(2)(K) of the Social Secu19 rity Act (42 U.S.C. 1395x(s)(2)(K)) are each 

20 amended by striking ‘‘subsection (ww)(1)’’ and in21 serting ‘‘subsections (ww)(1) and (hhh)’’. 

22 (b) PERSONALIZED PREVENTION PLAN SERVICES

23 DEFINED.—Section 1861 of the Social Security Act (42 

24 U.S.C. 1395x) is amended by adding at the end the fol25 lowing new subsection: 


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1 ‘‘Annual Wellness Visit 

2 ‘‘(hhh)(1) The term ‘personalized prevention plan 

3 services’ means the creation of a plan for an individual— 

4 ‘‘(A) that includes a health risk assessment 

5 (that meets the guidelines established by the Sec6 retary under paragraph (4)(A)) of the individual 

7 that is completed prior to or as part of the same 

8 visit with a health professional described in para9 graph (3); and 

10 ‘‘(B) that— 

11 ‘‘(i) takes into account the results of the 

12 health risk assessment; and 

13 ‘‘(ii) may contain the elements described in 

14 paragraph (2). 

15 ‘‘(2) Subject to paragraph (4)(H), the elements de16 scribed in this paragraph are the following: 

17 ‘‘(A) The establishment of, or an update to, the 

18 individual’s medical and family history. 

19 ‘‘(B) A list of current providers and suppliers 

20 that are regularly involved in providing medical care 

21 to the individual (including a list of all prescribed 

22 medications). 

23 ‘‘(C) A measurement of height, weight, body 

24 mass index (or waist circumference, if appropriate), 

25 blood pressure, and other routine measurements. 


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1 ‘‘(D) Detection of any cognitive impairment. 

2 ‘‘(E) The establishment of, or an update to, the 

3 following: 

4 ‘‘(i) A screening schedule for the next 5 to 

5 10 years, as appropriate, based on rec6 ommendations of the United States Preventive 

7 Services Task Force and the Advisory Com8 mittee on Immunization Practices, and the indi9 vidual’s health status, screening history, and 

10 age-appropriate preventive services covered 

11 under this title. 

12 ‘‘(ii) A list of risk factors and conditions 

13 for which primary, secondary, or tertiary pre14 vention interventions are recommended or are 

15 underway, including any mental health condi16 tions or any such risk factors or conditions that 

17 have been identified through an initial preven18 tive physical examination (as described under 

19 subsection (ww)(1)), and a list of treatment op20 tions and their associated risks and benefits. 

21 ‘‘(F) The furnishing of personalized health ad22 vice and a referral, as appropriate, to health edu23 cation or preventive counseling services or programs 

24 aimed at reducing identified risk factors and improv25 ing self-management, or community-based lifestyle 


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1 interventions to reduce health risks and promote 

2 self-management and wellness, including weight loss, 

3 physical activity, smoking cessation, fall prevention, 

4 and nutrition. 

5 ‘‘(G) Any other element determined appropriate 

6 by the Secretary. 

7 ‘‘(3) A health professional described in this para8 graph is— 

9 ‘‘(A) a physician; 

10 ‘‘(B) a practitioner described in clause (i) of 

11 section 1842(b)(18)(C); or 

12 ‘‘(C) a medical professional (including a health 

13 educator, registered dietitian, or nutrition profes14 sional) or a team of medical professionals, as deter15 mined appropriate by the Secretary, under the su16 pervision of a physician. 

17 ‘‘(4)(A) For purposes of paragraph (1)(A), the Sec18 retary, not later than 1 year after the date of enactment 

19 of this subsection, shall establish publicly available guide20 lines for health risk assessments. Such guidelines shall be 

21 developed in consultation with relevant groups and entities 

22 and shall provide that a health risk assessment— 

23 ‘‘(i) identify chronic diseases, injury risks, 

24 modifiable risk factors, and urgent health needs of 

25 the individual; and 


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1 ‘‘(ii) may be furnished— 

2 ‘‘(I) through an interactive telephonic or 

3 web-based program that meets the standards 

4 established under subparagraph (B); 

5 ‘‘(II) during an encounter with a health 

6 care professional; 

7 ‘‘(III) through community-based preven8 tion programs; or 

9 ‘‘(IV) through any other means the Sec10 retary determines appropriate to maximize ac11 cessibility and ease of use by beneficiaries, while 

12 ensuring the privacy of such beneficiaries. 

13 ‘‘(B) Not later than 1 year after the date of enact14 ment of this subsection, the Secretary shall establish 

15 standards for interactive telephonic or web-based pro16 grams used to furnish health risk assessments under sub17 paragraph (A)(ii)(I). The Secretary may utilize any health 

18 risk assessment developed under section 4004(f) of the 

19 Patient Protection and Affordable Care Act as part of the 

20 requirement to develop a personalized prevention plan to 

21 comply with this subparagraph. 

22 ‘‘(C)(i) Not later than 18 months after the date of 

23 enactment of this subsection, the Secretary shall develop 

24 and make available to the public a health risk assessment 

25 model. Such model shall meet the guidelines under subVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01178 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 paragraph (A) and may be used to meet the requirement 

2 under paragraph (1)(A). 

3 ‘‘(ii) Any health risk assessment that meets the 

4 guidelines under subparagraph (A) and is approved by the 

5 Secretary may be used to meet the requirement under 

6 paragraph (1)(A). 

7 ‘‘(D) The Secretary may coordinate with community8 based entities (including State Health Insurance Pro9 grams, Area Agencies on Aging, Aging and Disability Re10 source Centers, and the Administration on Aging) to— 

11 ‘‘(i) ensure that health risk assessments are ac12 cessible to beneficiaries; and 

13 ‘‘(ii) provide appropriate support for the com14 pletion of health risk assessments by beneficiaries. 

15 ‘‘(E) The Secretary shall establish procedures to 

16 make beneficiaries and providers aware of the requirement 

17 that a beneficiary complete a health risk assessment prior 

18 to or at the same time as receiving personalized prevention 

19 plan services. 

20 ‘‘(F) To the extent practicable, the Secretary shall 

21 encourage the use of, integration with, and coordination 

22 of health information technology (including use of tech23 nology that is compatible with electronic medical records 

24 and personal health records) and may experiment with the 

25 use of personalized technology to aid in the development 


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1 of self-management skills and management of and adher2 ence to provider recommendations in order to improve the 

3 health status of beneficiaries. 

4 ‘‘(G)(i) A beneficiary shall only be eligible to receive 

5 an initial preventive physical examination (as defined 

6 under subsection (ww)(1)) at any time during the 12- 

7 month period after the date that the beneficiary’s coverage 

8 begins under part B and shall be eligible to receive person9 alized prevention plan services under this subsection pro10 vided that the beneficiary has not received such services 

11 within the preceding 12-month period. 

12 ‘‘(ii) The Secretary shall establish procedures to 

13 make beneficiaries aware of the option to select an initial 

14 preventive physical examination or personalized prevention 

15 plan services during the period of 12 months after the date 

16 that a beneficiary’s coverage begins under part B, which 

17 shall include information regarding any relevant dif18 ferences between such services. 

19 ‘‘(H) The Secretary shall issue guidance that— 

20 ‘‘(i) identifies elements under paragraph (2) 

21 that are required to be provided to a beneficiary as 

22 part of their first visit for personalized prevention 

23 plan services; and 

24 ‘‘(ii) establishes a yearly schedule for appro25 priate provision of such elements thereafter.’’. 


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1 (c) PAYMENT AND ELIMINATION OF COST-SHAR2 ING.— 

3 (1) PAYMENT AND ELIMINATION OF COINSUR4 ANCE.—Section 1833(a)(1) of the Social Security 

5 Act (42 U.S.C. 1395l(a)(1)) is amended— 

6 (A) in subparagraph (N), by inserting 

7 ‘‘other than personalized prevention plan serv8 ices (as defined in section 1861(hhh)(1))’’ after 

9 ‘‘(as defined in section 1848(j)(3))’’; 

10 (B) by striking ‘‘and’’ before ‘‘(W)’’; and 

11 (C) by inserting before the semicolon at 

12 the end the following: ‘‘, and (X) with respect 

13 to personalized prevention plan services (as de14 fined in section 1861(hhh)(1)), the amount paid 

15 shall be 100 percent of the lesser of the actual 

16 charge for the services or the amount deter17 mined under the payment basis determined 

18 under section 1848’’. 

19 (2) PAYMENT UNDER PHYSICIAN FEE SCHED20 ULE.—Section 1848(j)(3) of the Social Security Act 

21 (42 U.S.C. 1395w–4(j)(3)) is amended by inserting 

22 ‘‘(2)(FF) (including administration of the health 

23 risk assessment) ,’’ after ‘‘(2)(EE),’’. 

24 (3) ELIMINATION OF COINSURANCE IN OUT25 PATIENT HOSPITAL SETTINGS.— 


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1 (A) EXCLUSION FROM OPD FEE SCHED2 ULE.—Section 1833(t)(1)(B)(iv) of the Social 

3 Security Act (42 U.S.C. 1395l(t)(1)(B)(iv)) is 

4 amended by striking ‘‘and diagnostic mammog5 raphy’’ and inserting ‘‘, diagnostic mammog6 raphy, or personalized prevention plan services 

7 (as defined in section 1861(hhh)(1))’’. 

8 (B) CONFORMING AMENDMENTS.—Section 

9 1833(a)(2) of the Social Security Act (42 

10 U.S.C. 1395l(a)(2)) is amended— 

11 (i) in subparagraph (F), by striking 

12 ‘‘and’’ at the end; 

13 (ii) in subparagraph (G)(ii), by strik14 ing the comma at the end and inserting ‘‘; 

15 and’’; and 

16 (iii) by inserting after subparagraph 

17 (G)(ii) the following new subparagraph: 

18 ‘‘(H) with respect to personalized preven19 tion plan services (as defined in section 

20 1861(hhh)(1)) furnished by an outpatient de21 partment of a hospital, the amount determined 

22 under paragraph (1)(X),’’. 

23 (4) WAIVER OF APPLICATION OF DEDUCT24 IBLE.—The first sentence of section 1833(b) of the 


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1 Social Security Act (42 U.S.C. 1395l(b)) is amend2 ed— 

3 (A) by striking ‘‘and’’ before ‘‘(9)’’; and 

4 (B) by inserting before the period the fol5 lowing: ‘‘, and (10) such deductible shall not 

6 apply with respect to personalized prevention 

7 plan services (as defined in section 

8 1861(hhh)(1))’’. 

9 (d) FREQUENCY LIMITATION.—Section 1862(a) of 

10 the Social Security Act (42 U.S.C. 1395y(a)) is amend11 ed— 

12 (1) in paragraph (1)— 

13 (A) in subparagraph (N), by striking 

14 ‘‘and’’ at the end; 

15 (B) in subparagraph (O), by striking the 

16 semicolon at the end and inserting ‘‘, and’’; and 

17 (C) by adding at the end the following new 

18 subparagraph: 

19 ‘‘(P) in the case of personalized prevention plan 

20 services (as defined in section 1861(hhh)(1)), which 

21 are performed more frequently than is covered under 

22 such section;’’; and 

23 (2) in paragraph (7), by striking ‘‘or (K)’’ and 

24 inserting ‘‘(K), or (P)’’. 


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1 (e) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to services furnished on or after 

3 January 1, 2011. 

4 SEC. 4104. REMOVAL OF BARRIERS TO PREVENTIVE SERV5 ICES IN MEDICARE. 

6 (a) DEFINITION OF PREVENTIVE SERVICES.—Sec7 tion 1861(ddd) of the Social Security Act (42 U.S.C. 

8 1395x(ddd)) is amended— 

9 (1) in the heading, by inserting ‘‘; Preventive 

10 Services’’ after ‘‘Services’’; 

11 (2) in paragraph (1), by striking ‘‘not otherwise 

12 described in this title’’ and inserting ‘‘not described 

13 in subparagraph (A) or (C) of paragraph (3)’’; and 

14 (3) by adding at the end the following new 

15 paragraph: 

16 ‘‘(3) The term ‘preventive services’ means the fol17 lowing: 

18 ‘‘(A) The screening and preventive services de19 scribed in subsection (ww)(2) (other than the service 

20 described in subparagraph (M) of such subsection). 

21 ‘‘(B) An initial preventive physical examination 

22 (as defined in subsection (ww)). 

23 ‘‘(C) Personalized prevention plan services (as 

24 defined in subsection (hhh)(1)).’’. 

25 (b) COINSURANCE.— 


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1 (1) GENERAL APPLICATION.— 

2 (A) IN GENERAL.—Section 1833(a)(1) of 

3 the Social Security Act (42 U.S.C. 

4 1395l(a)(1)), as amended by section 4103(c)(1), 

5 is amended— 

6 (i) in subparagraph (T), by inserting 

7 ‘‘(or 100 percent if such services are rec8 ommended with a grade of A or B by the 

9 United States Preventive Services Task 

10 Force for any indication or population and 

11 are appropriate for the individual)’’ after 

12 ‘‘80 percent’’; 

13 (ii) in subparagraph (W)— 

14 (I) in clause (i), by inserting ‘‘(if 

15 such subparagraph were applied, by 

16 substituting ‘100 percent’ for ‘80 per17 cent’)’’ after ‘‘subparagraph (D)’’; 

18 and 

19 (II) in clause (ii), by striking ‘‘80 

20 percent’’ and inserting ‘‘100 percent’’; 

21 (iii) by striking ‘‘and’’ before ‘‘(X)’’; 

22 and 

23 (iv) by inserting before the semicolon 

24 at the end the following: ‘‘, and (Y) with 

25 respect to preventive services described in 


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1 subparagraphs (A) and (B) of section 

2 1861(ddd)(3) that are appropriate for the 

3 individual and, in the case of such services 

4 described in subparagraph (A), are rec5 ommended with a grade of A or B by the 

6 United States Preventive Services Task 

7 Force for any indication or population, the 

8 amount paid shall be 100 percent of the 

9 lesser of the actual charge for the services 

10 or the amount determined under the fee 

11 schedule that applies to such services 

12 under this part’’. 

13 (2) ELIMINATION OF COINSURANCE IN OUT14 PATIENT HOSPITAL SETTINGS.— 

15 (A) EXCLUSION FROM OPD FEE SCHED16 ULE.—Section 1833(t)(1)(B)(iv) of the Social 

17 Security Act (42 U.S.C. 1395l(t)(1)(B)(iv)), as 

18 amended by section 4103(c)(3)(A), is amend19 ed— 

20 (i) by striking ‘‘or’’ before ‘‘personal21 ized prevention plan services’’; and 

22 (ii) by inserting before the period the 

23 following: ‘‘, or preventive services de24 scribed in subparagraphs (A) and (B) of 

25 section 1861(ddd)(3) that are appropriate 


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1 for the individual and, in the case of such 

2 services described in subparagraph (A), are 

3 recommended with a grade of A or B by 

4 the United States Preventive Services Task 

5 Force for any indication or population’’. 

6 (B) CONFORMING AMENDMENTS.—Section 

7 1833(a)(2) of the Social Security Act (42 

8 U.S.C. 1395l(a)(2)), as amended by section 

9 4103(c)(3)(B), is amended— 

10 (i) in subparagraph (G)(ii), by strik11 ing ‘‘and’’ after the semicolon at the end; 

12 (ii) in subparagraph (H), by striking 

13 the comma at the end and inserting ‘‘; 

14 and’’; and 

15 (iii) by inserting after subparagraph 

16 (H) the following new subparagraph: 

17 ‘‘(I) with respect to preventive services de18 scribed in subparagraphs (A) and (B) of section 

19 1861(ddd)(3) that are appropriate for the indi20 vidual and are furnished by an outpatient de21 partment of a hospital and, in the case of such 

22 services described in subparagraph (A), are rec23 ommended with a grade of A or B by the 

24 United States Preventive Services Task Force 

25 for any indication or population, the amount 


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1 determined under paragraph (1)(W) or 

2 (1)(Y),’’. 

3 (c) WAIVER OF APPLICATION OF DEDUCTIBLE FOR

4 PREVENTIVE SERVICES AND COLORECTAL CANCER

5 SCREENING TESTS.—Section 1833(b) of the Social Secu6 rity Act (42 U.S.C. 1395l(b)), as amended by section 

7 4103(c)(4), is amended— 

8 (1) in paragraph (1), by striking ‘‘items and 

9 services described in section 1861(s)(10)(A)’’ and in10 serting ‘‘preventive services described in subpara11 graph (A) of section 1861(ddd)(3) that are rec12 ommended with a grade of A or B by the United 

13 States Preventive Services Task Force for any indi14 cation or population and are appropriate for the in15 dividual.’’; and 

16 (2) by adding at the end the following new sen17 tence: ‘‘Paragraph (1) of the first sentence of this 

18 subsection shall apply with respect to a colorectal 

19 cancer screening test regardless of the code that is 

20 billed for the establishment of a diagnosis as a result 

21 of the test, or for the removal of tissue or other mat22 ter or other procedure that is furnished in connec23 tion with, as a result of, and in the same clinical en24 counter as the screening test.’’. 


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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to items and services furnished on 

3 or after January 1, 2011. 

4 SEC. 4105. EVIDENCE-BASED COVERAGE OF PREVENTIVE 

5 SERVICES IN MEDICARE. 

6 (a) AUTHORITY TO MODIFY OR ELIMINATE COV7 ERAGE OF CERTAIN PREVENTIVE SERVICES.—Section 

8 1834 of the Social Security Act (42 U.S.C. 1395m) is 

9 amended by adding at the end the following new sub10 section: 

11 ‘‘(n) AUTHORITY TO MODIFY OR ELIMINATE COV12 ERAGE OF CERTAIN PREVENTIVE SERVICES.—Notwith13 standing any other provision of this title, effective begin14 ning on January 1, 2010, if the Secretary determines ap15 propriate, the Secretary may— 

16 ‘‘(1) modify— 

17 ‘‘(A) the coverage of any preventive service 

18 described in subparagraph (A) of section 

19 1861(ddd)(3) to the extent that such modifica20 tion is consistent with the recommendations of 

21 the United States Preventive Services Task 

22 Force; and 

23 ‘‘(B) the services included in the initial 

24 preventive physical examination described in 

25 subparagraph (B) of such section; and 


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1 ‘‘(2) provide that no payment shall be made 

2 under this title for a preventive service described in 

3 subparagraph (A) of such section that has not re4 ceived a grade of A, B, C, or I by such Task 

5 Force.’’. 

6 (b) CONSTRUCTION.—Nothing in the amendment 

7 made by paragraph (1) shall be construed to affect the 

8 coverage of diagnostic or treatment services under title 

9 XVIII of the Social Security Act. 

10 SEC. 4106. IMPROVING ACCESS TO PREVENTIVE SERVICES 

11 FOR ELIGIBLE ADULTS IN MEDICAID. 

12 (a) CLARIFICATION OF INCLUSION OF SERVICES.— 

13 Section 1905(a)(13) of the Social Security Act (42 U.S.C. 

14 1396d(a)(13)) is amended to read as follows: 

15 ‘‘(13) other diagnostic, screening, preventive, 

16 and rehabilitative services, including— 

17 ‘‘(A) any clinical preventive services that 

18 are assigned a grade of A or B by the United 

19 States Preventive Services Task Force; 

20 ‘‘(B) with respect to an adult individual, 

21 approved vaccines recommended by the Advi22 sory Committee on Immunization Practices (an 

23 advisory committee established by the Sec24 retary, acting through the Director of the CenVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01190 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ters for Disease Control and Prevention) and 

2 their administration; and 

3 ‘‘(C) any medical or remedial services (pro4 vided in a facility, a home, or other setting) rec5 ommended by a physician or other licensed 

6 practitioner of the healing arts within the scope 

7 of their practice under State law, for the max8 imum reduction of physical or mental disability 

9 and restoration of an individual to the best pos10 sible functional level;’’. 

11 (b) INCREASED FMAP.—Section 1905(b) of the So12 cial Security Act (42 U.S.C. 1396d(b)), as amended by 

13 sections 2001(a)(3)(A) and 2004(c)(1), is amended in the 

14 first sentence— 

15 (1) by striking ‘‘, and (4)’’ and inserting ‘‘, 

16 (4)’’; and 

17 (2) by inserting before the period the following: 

18 ‘‘, and (5) in the case of a State that provides med19 ical assistance for services and vaccines described in 

20 subparagraphs (A) and (B) of subsection (a)(13), 

21 and prohibits cost-sharing for such services and vac22 cines, the Federal medical assistance percentage, as 

23 determined under this subsection and subsection (y) 

24 (without regard to paragraph (1)(C) of such sub25 section), shall be increased by 1 percentage point 


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1 with respect to medical assistance for such services 

2 and vaccines and for items and services described in 

3 subsection (a)(4)(D)’’. 

4 (c) EFFECTIVE DATE.—The amendments made 

5 under this section shall take effect on January 1, 2013. 

6 SEC. 4107. COVERAGE OF COMPREHENSIVE TOBACCO CES7 SATION SERVICES FOR PREGNANT WOMEN IN 

8 MEDICAID. 

9 (a) REQUIRING COVERAGE OF COUNSELING AND

10 PHARMACOTHERAPY FOR CESSATION OF TOBACCO USE

11 BY PREGNANT WOMEN.—Section 1905 of the Social Secu12 rity Act (42 U.S.C. 1396d), as amended by sections 

13 2001(a)(3)(B) and 2303, is further amended— 

14 (1) in subsection (a)(4)— 

15 (A) by striking ‘‘and’’ before ‘‘(C)’’; and 

16 (B) by inserting before the semicolon at 

17 the end the following new subparagraph: ‘‘; and 

18 (D) counseling and pharmacotherapy for ces19 sation of tobacco use by pregnant women (as 

20 defined in subsection (bb))’’; and 

21 (2) by adding at the end the following: 

22 ‘‘(bb)(1) For purposes of this title, the term ‘coun23 seling and pharmacotherapy for cessation of tobacco use 

24 by pregnant women’ means diagnostic, therapy, and coun25 seling services and pharmacotherapy (including the covVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01192 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 erage of prescription and nonprescription tobacco ces2 sation agents approved by the Food and Drug Administra3 tion) for cessation of tobacco use by pregnant women who 

4 use tobacco products or who are being treated for tobacco 

5 use that is furnished— 

6 ‘‘(A) by or under the supervision of a physician; 

7 or 

8 ‘‘(B) by any other health care professional 

9 who— 

10 ‘‘(i) is legally authorized to furnish such 

11 services under State law (or the State regu12 latory mechanism provided by State law) of the 

13 State in which the services are furnished; and 

14 ‘‘(ii) is authorized to receive payment for 

15 other services under this title or is designated 

16 by the Secretary for this purpose. 

17 ‘‘(2) Subject to paragraph (3), such term is limited 

18 to— 

19 ‘‘(A) services recommended with respect to 

20 pregnant women in ‘Treating Tobacco Use and De21 pendence: 2008 Update: A Clinical Practice Guide22 line’, published by the Public Health Service in May 

23 2008, or any subsequent modification of such Guide24 line; and 


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1 ‘‘(B) such other services that the Secretary rec2 ognizes to be effective for cessation of tobacco use 

3 by pregnant women. 

4 ‘‘(3) Such term shall not include coverage for drugs 

5 or biologicals that are not otherwise covered under this 

6 title.’’. 

7 (b) EXCEPTION FROM OPTIONAL RESTRICTION

8 UNDER MEDICAID PRESCRIPTION DRUG COVERAGE.— 

9 Section 1927(d)(2)(F) of the Social Security Act (42 

10 U.S.C. 1396r–8(d)(2)(F)), as redesignated by section 

11 2502(a), is amended by inserting before the period at the 

12 end the following: ‘‘, except, in the case of pregnant 

13 women when recommended in accordance with the Guide14 line referred to in section 1905(bb)(2)(A), agents ap15 proved by the Food and Drug Administration under the 

16 over-the-counter monograph process for purposes of pro17 moting, and when used to promote, tobacco cessation’’. 

18 (c) REMOVAL OF COST-SHARING FOR COUNSELING

19 AND PHARMACOTHERAPY FOR CESSATION OF TOBACCO

20 USE BY PREGNANT WOMEN.— 

21 (1) GENERAL COST-SHARING LIMITATIONS.— 

22 Section 1916 of the Social Security Act (42 U.S.C. 

23 1396o) is amended in each of subsections (a)(2)(B) 

24 and (b)(2)(B) by inserting ‘‘, and counseling and 

25 pharmacotherapy for cessation of tobacco use by 


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1 pregnant women (as defined in section 1905(bb)) 

2 and covered outpatient drugs (as defined in sub3 section (k)(2) of section 1927 and including non4 prescription drugs described in subsection (d)(2) of 

5 such section) that are prescribed for purposes of 

6 promoting, and when used to promote, tobacco ces7 sation by pregnant women in accordance with the 

8 Guideline referred to in section 1905(bb)(2)(A)’’ 

9 after ‘‘complicate the pregnancy’’. 

10 (2) APPLICATION TO ALTERNATIVE COST-SHAR11 ING.—Section 1916A(b)(3)(B)(iii) of such Act (42 

12 U.S.C. 1396o–1(b)(3)(B)(iii)) is amended by insert13 ing ‘‘, and counseling and pharmacotherapy for ces14 sation of tobacco use by pregnant women (as defined 

15 in section 1905(bb))’’ after ‘‘complicate the preg16 nancy’’. 

17 (d) EFFECTIVE DATE.—The amendments made by 

18 this section shall take effect on October 1, 2010. 

19 SEC. 4108. INCENTIVES FOR PREVENTION OF CHRONIC DIS20 EASES IN MEDICAID. 

21 (a) INITIATIVES.— 

22 (1) ESTABLISHMENT.— 

23 (A) IN GENERAL.—The Secretary shall 

24 award grants to States to carry out initiatives 


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1 to provide incentives to Medicaid beneficiaries 

2 who— 

3 (i) successfully participate in a pro4 gram described in paragraph (3); and 

5 (ii) upon completion of such participa6 tion, demonstrate changes in health risk 

7 and outcomes, including the adoption and 

8 maintenance of healthy behaviors by meet9 ing specific targets (as described in sub10 section (c)(2)). 

11 (B) PURPOSE.—The purpose of the initia12 tives under this section is to test approaches 

13 that may encourage behavior modification and 

14 determine scalable solutions. 

15 (2) DURATION.— 

16 (A) INITIATION OF PROGRAM; RE17 SOURCES.—The Secretary shall awards grants 

18 to States beginning on January 1, 2011, or be19 ginning on the date on which the Secretary de20 velops program criteria, whichever is earlier. 

21 The Secretary shall develop program criteria for 

22 initiatives under this section using relevant evi23 dence-based research and resources, including 

24 the Guide to Community Preventive Services, 

25 the Guide to Clinical Preventive Services, and 


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1 the National Registry of Evidence-Based Pro2 grams and Practices. 

3 (B) DURATION OF PROGRAM.—A State 

4 awarded a grant to carry out initiatives under 

5 this section shall carry out such initiatives with6 in the 5-year period beginning on January 1, 

7 2011, or beginning on the date on which the 

8 Secretary develops program criteria, whichever 

9 is earlier. Initiatives under this section shall be 

10 carried out by a State for a period of not less 

11 than 3 years. 

12 (3) PROGRAM DESCRIBED.— 

13 (A) IN GENERAL.—A program described in 

14 this paragraph is a comprehensive, evidence15 based, widely available, and easily accessible 

16 program, proposed by the State and approved 

17 by the Secretary, that is designed and uniquely 

18 suited to address the needs of Medicaid bene19 ficiaries and has demonstrated success in help20 ing individuals achieve one or more of the fol21 lowing: 

22 (i) Ceasing use of tobacco products. 

23 (ii) Controlling or reducing their 

24 weight. 

25 (iii) Lowering their cholesterol. 


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1 (iv) Lowering their blood pressure. 

2 (v) Avoiding the onset of diabetes or, 

3 in the case of a diabetic, improving the 

4 management of that condition. 

5 (B) CO-MORBIDITIES.—A program under 

6 this section may also address co-morbidities (in7 cluding depression) that are related to any of 

8 the conditions described in subparagraph (A). 

9 (C) WAIVER AUTHORITY.—The Secretary 

10 may waive the requirements of section 

11 1902(a)(1) (relating to statewideness) of the 

12 Social Security Act for a State awarded a grant 

13 to conduct an initiative under this section and 

14 shall ensure that a State makes any program 

15 described in subparagraph (A) available and ac16 cessible to Medicaid beneficiaries. 

17 (D) FLEXIBILITY IN IMPLEMENTATION.— 

18 A State may enter into arrangements with pro19 viders participating in Medicaid, community20 based organizations, faith-based organizations, 

21 public-private partnerships, Indian tribes, or 

22 similar entities or organizations to carry out 

23 programs described in subparagraph (A). 

24 (4) APPLICATION.—Following the development 

25 of program criteria by the Secretary, a State may 


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1 submit an application, in such manner and con2 taining such information as the Secretary may re3 quire, that shall include a proposal for programs de4 scribed in paragraph (3)(A) and a plan to make 

5 Medicaid beneficiaries and providers participating in 

6 Medicaid who reside in the State aware and in7 formed about such programs. 

8 (b) EDUCATION AND OUTREACH CAMPAIGN.— 

9 (1) STATE AWARENESS.—The Secretary shall 

10 conduct an outreach and education campaign to 

11 make States aware of the grants under this section. 

12 (2) PROVIDER AND BENEFICIARY EDU13 CATION.—A State awarded a grant to conduct an 

14 initiative under this section shall conduct an out15 reach and education campaign to make Medicaid 

16 beneficiaries and providers participating in Medicaid 

17 who reside in the State aware of the programs de18 scribed in subsection (a)(3) that are to be carried 

19 out by the State under the grant. 

20 (c) IMPACT.—A State awarded a grant to conduct an 

21 initiative under this section shall develop and implement 

22 a system to— 

23 (1) track Medicaid beneficiary participation in 

24 the program and validate changes in health risk and 

25 outcomes with clinical data, including the adoption 


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1 and maintenance of health behaviors by such bene2 ficiaries; 

3 (2) to the extent practicable, establish stand4 ards and health status targets for Medicaid bene5 ficiaries participating in the program and measure 

6 the degree to which such standards and targets are 

7 met; 

8 (3) evaluate the effectiveness of the program 

9 and provide the Secretary with such evaluations; 

10 (4) report to the Secretary on processes that 

11 have been developed and lessons learned from the 

12 program; and 

13 (5) report on preventive services as part of re14 porting on quality measures for Medicaid managed 

15 care programs. 

16 (d) EVALUATIONS AND REPORTS.— 

17 (1) INDEPENDENT ASSESSMENT.—The Sec18 retary shall enter into a contract with an inde19 pendent entity or organization to conduct an evalua20 tion and assessment of the initiatives carried out by 

21 States under this section, for the purpose of deter22 mining— 

23 (A) the effect of such initiatives on the use 

24 of health care services by Medicaid beneficiaries 

25 participating in the program; 


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1 (B) the extent to which special populations 

2 (including adults with disabilities, adults with 

3 chronic illnesses, and children with special 

4 health care needs) are able to participate in the 

5 program; 

6 (C) the level of satisfaction of Medicaid 

7 beneficiaries with respect to the accessibility 

8 and quality of health care services provided 

9 through the program; and 

10 (D) the administrative costs incurred by 

11 State agencies that are responsible for adminis12 tration of the program. 

13 (2) STATE REPORTING.—A State awarded a 

14 grant to carry out initiatives under this section shall 

15 submit reports to the Secretary, on a semi-annual 

16 basis, regarding the programs that are supported by 

17 the grant funds. Such report shall include informa18 tion, as specified by the Secretary, regarding— 

19 (A) the specific uses of the grant funds; 

20 (B) an assessment of program implementa21 tion and lessons learned from the programs; 

22 (C) an assessment of quality improvements 

23 and clinical outcomes under such programs; and 

24 (D) estimates of cost savings resulting 

25 from such programs. 


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1 (3) INITIAL REPORT.—Not later than January 

2 1, 2014, the Secretary shall submit to Congress an 

3 initial report on such initiatives based on informa4 tion provided by States through reports required 

5 under paragraph (2). The initial report shall include 

6 an interim evaluation of the effectiveness of the ini7 tiatives carried out with grants awarded under this 

8 section and a recommendation regarding whether 

9 funding for expanding or extending the initiatives 

10 should be extended beyond January 1, 2016. 

11 (4) FINAL REPORT.—Not later than July 1, 

12 2016, the Secretary shall submit to Congress a final 

13 report on the program that includes the results of 

14 the independent assessment required under para15 graph (1), together with recommendations for such 

16 legislation and administrative action as the Sec17 retary determines appropriate. 

18 (e) NO EFFECT ON ELIGIBILITY FOR, OR AMOUNT

19 OF, MEDICAID OR OTHER BENEFITS.—Any incentives 

20 provided to a Medicaid beneficiary participating in a pro21 gram described in subsection (a)(3) shall not be taken into 

22 account for purposes of determining the beneficiary’s eligi23 bility for, or amount of, benefits under the Medicaid pro24 gram or any program funded in whole or in part with Fed25 eral funds. 


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1 (f) FUNDING.—Out of any funds in the Treasury not 

2 otherwise appropriated, there are appropriated for the 5- 

3 year period beginning on January 1, 2011, $100,000,000 

4 to the Secretary to carry out this section. Amounts appro5 priated under this subsection shall remain available until 

6 expended. 

7 (g) DEFINITIONS.—In this section: 

8 (1) MEDICAID BENEFICIARY.—The term ‘‘Med9 icaid beneficiary’’ means an individual who is eligible 

10 for medical assistance under a State plan or waiver 

11 under title XIX of the Social Security Act (42 

12 U.S.C. 1396 et seq.) and is enrolled in such plan or 

13 waiver. 

14 (2) STATE.—The term ‘‘State’’ has the mean15 ing given that term for purposes of title XIX of the 

16 Social Security Act (42 U.S.C. 1396 et seq.). 

17 Subtitle C—Creating Healthier 

18 Communities 

19 SEC. 4201. COMMUNITY TRANSFORMATION GRANTS. 

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

21 Human Services (referred to in this section as the ‘‘Sec22 retary’’), acting through the Director of the Centers for 

23 Disease Control and Prevention (referred to in this section 

24 as the ‘‘Director’’), shall award competitive grants to 

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1 based organizations for the implementation, evaluation, 

2 and dissemination of evidence-based community preventive 

3 health activities in order to reduce chronic disease rates, 

4 prevent the development of secondary conditions, address 

5 health disparities, and develop a stronger evidence-base of 

6 effective prevention programming. 

7 (b) ELIGIBILITY.—To be eligible to receive a grant 

8 under subsection (a), an entity shall— 

9 (1) be— 

10 (A) a State governmental agency; 

11 (B) a local governmental agency; 

12 (C) a national network of community-based 

13 organizations; 

14 (D) a State or local non-profit organiza15 tion; or 

16 (E) an Indian tribe; and 

17 (2) submit to the Director an application at 

18 such time, in such a manner, and containing such 

19 information as the Director may require, including a 

20 description of the program to be carried out under 

21 the grant; and 

22 (3) demonstrate a history or capacity, if fund23 ed, to develop relationships necessary to engage key 

24 stakeholders from multiple sectors within and beVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01204 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 yond health care and across a community, such as 

2 healthy futures corps and health care providers. 

3 (c) USE OF FUNDS.— 

4 (1) IN GENERAL.—An eligible entity shall use 

5 amounts received under a grant under this section to 

6 carry out programs described in this subsection. 

7 (2) COMMUNITY TRANSFORMATION PLAN.— 

8 (A) IN GENERAL.—An eligible entity that 

9 receives a grant under this section shall submit 

10 to the Director (for approval) a detailed plan 

11 that includes the policy, environmental, pro12 grammatic, and as appropriate infrastructure 

13 changes needed to promote healthy living and 

14 reduce disparities. 

15 (B) ACTIVITIES.—Activities within the 

16 plan may focus on (but not be limited to)— 

17 (i) creating healthier school environ18 ments, including increasing healthy food 

19 options, physical activity opportunities, 

20 promotion of healthy lifestyle, emotional 

21 wellness, and prevention curricula, and ac22 tivities to prevent chronic diseases; 

23 (ii) creating the infrastructure to sup24 port active living and access to nutritious 

25 foods in a safe environment; 


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1 (iii) developing and promoting pro2 grams targeting a variety of age levels to 

3 increase access to nutrition, physical activ4 ity and smoking cessation, improve social 

5 and emotional wellness, enhance safety in 

6 a community, or address any other chronic 

7 disease priority area identified by the 

8 grantee; 

9 (iv) assessing and implementing work10 site wellness programming and incentives; 

11 (v) working to highlight healthy op12 tions at restaurants and other food venues; 

13 (vi) prioritizing strategies to reduce 

14 racial and ethnic disparities, including so15 cial, economic, and geographic deter16 minants of health; and 

17 (vii) addressing special populations 

18 needs, including all age groups and individ19 uals with disabilities, and individuals in 

20 both urban and rural areas. 

21 (3) COMMUNITY-BASED PREVENTION HEALTH

22 ACTIVITIES.— 

23 (A) IN GENERAL.—An eligible entity shall 

24 use amounts received under a grant under this 

25 section to implement a variety of programs, 


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1 policies, and infrastructure improvements to 

2 promote healthier lifestyles. 

3 (B) ACTIVITIES.—An eligible entity shall 

4 implement activities detailed in the community 

5 transformation plan under paragraph (2). 

6 (C) IN-KIND SUPPORT.—An eligible entity 

7 may provide in-kind resources such as staff, 

8 equipment, or office space in carrying out ac9 tivities under this section. 

10 (4) EVALUATION.— 

11 (A) IN GENERAL.—An eligible entity shall 

12 use amounts provided under a grant under this 

13 section to conduct activities to measure changes 

14 in the prevalence of chronic disease risk factors 

15 among community members participating in 

16 preventive health activities 

17 (B) TYPES OF MEASURES.—In carrying 

18 out subparagraph (A), the eligible entity shall, 

19 with respect to residents in the community, 

20 measure— 

21 (i) changes in weight; 

22 (ii) changes in proper nutrition; 

23 (iii) changes in physical activity; 

24 (iv) changes in tobacco use prevalence; 


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1 (v) changes in emotional well-being 

2 and overall mental health; 

3 (vi) other factors using community4 specific data from the Behavioral Risk 

5 Factor Surveillance Survey; and 

6 (vii) other factors as determined by 

7 the Secretary. 

8 (C) REPORTING.—An eligible entity shall 

9 annually submit to the Director a report con10 taining an evaluation of activities carried out 

11 under the grant. 

12 (5) DISSEMINATION.—A grantee under this sec13 tion shall— 

14 (A) meet at least annually in regional or 

15 national meetings to discuss challenges, best 

16 practices, and lessons learned with respect to 

17 activities carried out under the grant; and 

18 (B) develop models for the replication of 

19 successful programs and activities and the men20 toring of other eligible entities. 

21 (d) TRAINING.— 

22 (1) IN GENERAL.—The Director shall develop a 

23 program to provide training for eligible entities on 

24 effective strategies for the prevention and control of 


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1 chronic disease and the link between physical, emo2 tional, and social well-being. 

3 (2) COMMUNITY TRANSFORMATION PLAN.—The 

4 Director shall provide appropriate feedback and 

5 technical assistance to grantees to establish commu6 nity transformation plans 

7 (3) EVALUATION.—The Director shall provide a 

8 literature review and framework for the evaluation 

9 of programs conducted as part of the grant program 

10 under this section, in addition to working with aca11 demic institutions or other entities with expertise in 

12 outcome evaluation. 

13 (e) PROHIBITION.—A grantee shall not use funds 

14 provided under a grant under this section to create video 

15 games or to carry out any other activities that may lead 

16 to higher rates of obesity or inactivity. 

17 (f) AUTHORIZATION OF APPROPRIATIONS.—There 

18 are authorized to be appropriated to carry out this section, 

19 such sums as may be necessary for each fiscal years 2010 

20 through 2014. 

21 SEC. 4202. HEALTHY AGING, LIVING WELL; EVALUATION OF 

22 COMMUNITY-BASED PREVENTION AND 

23 WELLNESS PROGRAMS FOR MEDICARE BENE24 FICIARIES. 

25 (a) HEALTHY AGING, LIVING WELL.— 


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

2 Human Services (referred to in this section as the 

3 ‘‘Secretary’’), acting through the Director of the 

4 Centers for Disease Control and Prevention, shall 

5 award grants to State or local health departments 

6 and Indian tribes to carry out 5-year pilot programs 

7 to provide public health community interventions, 

8 screenings, and where necessary, clinical referrals 

9 for individuals who are between 55 and 64 years of 

10 age. 

11 (2) ELIGIBILITY.—To be eligible to receive a 

12 grant under paragraph (1), an entity shall— 

13 (A) be— 

14 (i) a State health department; 

15 (ii) a local health department; or 

16 (iii) an Indian tribe; 

17 (B) submit to the Secretary an application 

18 at such time, in such manner, and containing 

19 such information as the Secretary may require 

20 including a description of the program to be 

21 carried out under the grant; 

22 (C) design a strategy for improving the 

23 health of the 55-to-64 year-old population 

24 through community-based public health inter25 ventions; and 


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1 (D) demonstrate the capacity, if funded, to 

2 develop the relationships necessary with rel3 evant health agencies, health care providers, 

4 community-based organizations, and insurers to 

5 carry out the activities described in paragraph 

6 (3), such relationships to include the identifica7 tion of a community-based clinical partner, such 

8 as a community health center or rural health 

9 clinic. 

10 (3) USE OF FUNDS.— 

11 (A) IN GENERAL.—A State or local health 

12 department shall use amounts received under a 

13 grant under this subsection to carry out a pro14 gram to provide the services described in this 

15 paragraph to individuals who are between 55 

16 and 64 years of age. 

17 (B) PUBLIC HEALTH INTERVENTIONS.— 

18 (i) IN GENERAL.—In developing and 

19 implementing such activities, a grantee 

20 shall collaborate with the Centers for Dis21 ease Control and Prevention and the Ad22 ministration on Aging, and relevant local 

23 agencies and organizations. 

24 (ii) TYPES OF INTERVENTION ACTIVI25 TIES.—Intervention activities conducted 


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1 under this subparagraph may include ef2 forts to improve nutrition, increase phys3 ical activity, reduce tobacco use and sub4 stance abuse, improve mental health, and 

5 promote healthy lifestyles among the target 

6 population. 

7 (C) COMMUNITY PREVENTIVE

8 SCREENINGS.— 

9 (i) IN GENERAL.—In addition to com10 munity-wide public health interventions, a 

11 State or local health department shall use 

12 amounts received under a grant under this 

13 subsection to conduct ongoing health 

14 screening to identify risk factors for car15 diovascular disease, cancer, stroke, and di16 abetes among individuals in both urban 

17 and rural areas who are between 55 and 

18 64 years of age. 

19 (ii) TYPES OF SCREENING ACTIVI20 TIES.—Screening activities conducted 

21 under this subparagraph may include— 

22 (I) mental health/behavioral 

23 health and substance use disorders; 

24 (II) physical activity, smoking, 

25 and nutrition; and 


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1 (III) any other measures deemed 

2 appropriate by the Secretary. 

3 (iii) MONITORING.—Grantees under 

4 this section shall maintain records of 

5 screening results under this subparagraph 

6 to establish the baseline data for moni7 toring the targeted population 

8 (D) CLINICAL REFERRAL/TREATMENT FOR

9 CHRONIC DISEASES.— 

10 (i) IN GENERAL.—A State or local 

11 health department shall use amounts re12 ceived under a grant under this subsection 

13 to ensure that individuals between 55 and 

14 64 years of age who are found to have 

15 chronic disease risk factors through the 

16 screening activities described in subpara17 graph (C)(ii), receive clinical referral/treat18 ment for follow-up services to reduce such 

19 risk. 

20 (ii) MECHANISM.— 

21 (I) IDENTIFICATION AND DETER22 MINATION OF STATUS.—With respect 

23 to each individual with risk factors for 

24 or having heart disease, stroke, diabe25 tes, or any other condition for which 


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1 such individual was screened under 

2 subparagraph (C), a grantee under 

3 this section shall determine whether 

4 or not such individual is covered 

5 under any public or private health in6 surance program. 

7 (II) INSURED INDIVIDUALS.—An 

8 individual determined to be covered 

9 under a health insurance program 

10 under subclause (I) shall be referred 

11 by the grantee to the existing pro12 viders under such program or, if such 

13 individual does not have a current 

14 provider, to a provider who is in-net15 work with respect to the program in16 volved. 

17 (III) UNINSURED INDIVID18 UALS.—With respect to an individual 

19 determined to be uninsured under 

20 subclause (I), the grantee’s commu21 nity-based clinical partner described 

22 in paragraph (4)(D) shall assist the 

23 individual in determining eligibility for 

24 available public coverage options and 

25 identify other appropriate community 


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1 health care resources and assistance 

2 programs. 

3 (iii) PUBLIC HEALTH INTERVENTION

4 PROGRAM.—A State or local health depart5 ment shall use amounts received under a 

6 grant under this subsection to enter into 

7 contracts with community health centers or 

8 rural health clinics and mental health and 

9 substance use disorder service providers to 

10 assist in the referral/treatment of at risk 

11 patients to community resources for clin12 ical follow-up and help determine eligibility 

13 for other public programs. 

14 (E) GRANTEE EVALUATION.—An eligible 

15 entity shall use amounts provided under a grant 

16 under this subsection to conduct activities to 

17 measure changes in the prevalence of chronic 

18 disease risk factors among participants. 

19 (4) PILOT PROGRAM EVALUATION.—The Sec20 retary shall conduct an annual evaluation of the ef21 fectiveness of the pilot program under this sub22 section. In determining such effectiveness, the Sec23 retary shall consider changes in the prevalence of 

24 uncontrolled chronic disease risk factors among new 

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1 ment, including those who are 63 and 64 years of 

2 age) who reside in States or localities receiving 

3 grants under this section as compared with national 

4 and historical data for those States and localities for 

5 the same population. 

6 (5) AUTHORIZATION OF APPROPRIATIONS.— 

7 There are authorized to be appropriated to carry out 

8 this subsection, such sums as may be necessary for 

9 each of fiscal years 2010 through 2014. 

10 (b) EVALUATION AND PLAN FOR COMMUNITY-BASED

11 PREVENTION AND WELLNESS PROGRAMS FOR MEDICARE

12 BENEFICIARIES.— 

13 (1) IN GENERAL.—The Secretary shall conduct 

14 an evaluation of community-based prevention and 

15 wellness programs and develop a plan for promoting 

16 healthy lifestyles and chronic disease self-manage17 ment for Medicare beneficiaries. 

18 (2) MEDICARE EVALUATION OF PREVENTION

19 AND WELLNESS PROGRAMS.— 

20 (A) IN GENERAL.—The Secretary shall 

21 evaluate community prevention and wellness 

22 programs including those that are sponsored by 

23 the Administration on Aging, are evidence24 based, and have demonstrated potential to help 

25 Medicare beneficiaries (particularly beneficiaries 


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1 that have attained 65 years of age) reduce their 

2 risk of disease, disability, and injury by making 

3 healthy lifestyle choices, including exercise, diet, 

4 and self-management of chronic diseases. 

5 (B) EVALUATION.—The evaluation under 

6 subparagraph (A) shall consist of the following: 

7 (i) EVIDENCE REVIEW.—The Sec8 retary shall review available evidence, lit9 erature, best practices, and resources that 

10 are relevant to programs that promote 

11 healthy lifestyles and reduce risk factors 

12 for the Medicare population. The Secretary 

13 may determine the scope of the evidence 

14 review and such issues to be considered, 

15 which shall include, at a minimum— 

16 (I) physical activity, nutrition, 

17 and obesity; 

18 (II) falls; 

19 (III) chronic disease self-manage20 ment; and 

21 (IV) mental health. 

22 (ii) INDEPENDENT EVALUATION OF

23 EVIDENCE-BASED COMMUNITY PREVEN24 TION AND WELLNESS PROGRAMS.—The 

25 Administrator of the Centers for Medicare 


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1 & Medicaid Services, in consultation with 

2 the Assistant Secretary for Aging, shall, to 

3 the extent feasible and practicable, conduct 

4 an evaluation of existing community pre5 vention and wellness programs that are 

6 sponsored by the Administration on Aging 

7 to assess the extent to which Medicare 

8 beneficiaries who participate in such pro9 grams— 

10 (I) reduce their health risks, im11 prove their health outcomes, and 

12 adopt and maintain healthy behaviors; 

13 (II) improve their ability to man14 age their chronic conditions; and 

15 (III) reduce their utilization of 

16 health services and associated costs 

17 under the Medicare program for con18 ditions that are amenable to improve19 ment under such programs. 

20 (3) REPORT.—Not later than September 30, 

21 2013, the Secretary shall submit to Congress a re22 port that includes— 

23 (A) recommendations for such legislation 

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1 styles and chronic disease self-management for 

2 Medicare beneficiaries; 

3 (B) any relevant findings relating to the 

4 evidence review under paragraph (2)(B)(i); and 

5 (C) the results of the evaluation under 

6 paragraph (2)(B)(ii). 

7 (4) FUNDING.—For purposes of carrying out 

8 this subsection, the Secretary shall provide for the 

9 transfer, from the Federal Hospital Insurance Trust 

10 Fund under section 1817 of the Social Security Act 

11 (42 U.S.C. 1395i) and the Federal Supplemental 

12 Medical Insurance Trust Fund under section 1841 

13 of such Act (42 U.S.C. 1395t), in such proportion 

14 as the Secretary determines appropriate, of 

15 $50,000,000 to the Centers for Medicare & Medicaid 

16 Services Program Management Account. Amounts 

17 transferred under the preceding sentence shall re18 main available until expended. 

19 (5) ADMINISTRATION.—Chapter 35 of title 44, 

20 United States Code shall not apply to the this sub21 section. 

22 (6) MEDICARE BENEFICIARY.—In this sub23 section, the term ‘‘Medicare beneficiary’’ means an 

24 individual who is entitled to benefits under part A 


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1 of title XVIII of the Social Security Act and enrolled 

2 under part B of such title. 

3 SEC. 4203. REMOVING BARRIERS AND IMPROVING ACCESS 

4 TO WELLNESS FOR INDIVIDUALS WITH DIS5 ABILITIES. 

6 Title V of the Rehabilitation Act of 1973 (29 U.S.C. 

7 791 et seq.) is amended by adding at the end of the fol8 lowing: 

9 ‘‘SEC. 510. ESTABLISHMENT OF STANDARDS FOR ACCES10 SIBLE MEDICAL DIAGNOSTIC EQUIPMENT. 

11 ‘‘(a) STANDARDS.—Not later than 24 months after 

12 the date of enactment of the Affordable Health Choices 

13 Act, the Architectural and Transportation Barriers Com14 pliance Board shall, in consultation with the Commis15 sioner of the Food and Drug Administration, promulgate 

16 regulatory standards in accordance with the Administra17 tive Procedure Act (2 U.S.C. 551 et seq.) setting forth 

18 the minimum technical criteria for medical diagnostic 

19 equipment used in (or in conjunction with) physician’s of20 fices, clinics, emergency rooms, hospitals, and other med21 ical settings. The standards shall ensure that such equip22 ment is accessible to, and usable by, individuals with ac23 cessibility needs, and shall allow independent entry to, use 

24 of, and exit from the equipment by such individuals to the 

25 maximum extent possible. 


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1 ‘‘(b) MEDICAL DIAGNOSTIC EQUIPMENT COV2 ERED.—The standards issued under subsection (a) for 

3 medical diagnostic equipment shall apply to equipment 

4 that includes examination tables, examination chairs (in5 cluding chairs used for eye examinations or procedures, 

6 and dental examinations or procedures), weight scales, 

7 mammography equipment, x-ray machines, and other radi8 ological equipment commonly used for diagnostic purposes 

9 by health professionals. 

10 ‘‘(c) REVIEW AND AMENDMENT.—The Architectural 

11 and Transportation Barriers Compliance Board, in con12 sultation with the Commissioner of the Food and Drug 

13 Administration, shall periodically review and, as appro14 priate, amend the standards in accordance with the Ad15 ministrative Procedure Act (2 U.S.C. 551 et seq.).’’. 

16 SEC. 4204. IMMUNIZATIONS. 

17 (a) STATE AUTHORITY TO PURCHASE REC18 OMMENDED VACCINES FOR ADULTS.—Section 317 of the 

19 Public Health Service Act (42 U.S.C. 247b) is amended 

20 by adding at the end the following: 

21 ‘‘(l) AUTHORITY TO PURCHASE RECOMMENDED VAC22 CINES FOR ADULTS.— 

23 ‘‘(1) IN GENERAL.—The Secretary may nego24 tiate and enter into contracts with manufacturers of 


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1 vaccines for the purchase and delivery of vaccines 

2 for adults as provided for under subsection (e). 

3 ‘‘(2) STATE PURCHASE.—A State may obtain 

4 additional quantities of such adult vaccines (subject 

5 to amounts specified to the Secretary by the State 

6 in advance of negotiations) through the purchase of 

7 vaccines from manufacturers at the applicable price 

8 negotiated by the Secretary under this subsection.’’. 

9 (b) DEMONSTRATION PROGRAM TO IMPROVE IMMU10 NIZATION COVERAGE.—Section 317 of the Public Health 

11 Service Act (42 U.S.C. 247b), as amended by subsection 

12 (a), is further amended by adding at the end the following: 

13 ‘‘(m) DEMONSTRATION PROGRAM TO IMPROVE IM14 MUNIZATION COVERAGE.— 

15 ‘‘(1) IN GENERAL.—The Secretary, acting 

16 through the Director of the Centers for Disease 

17 Control and Prevention, shall establish a demonstra18 tion program to award grants to States to improve 

19 the provision of recommended immunizations for 

20 children, adolescents, and adults through the use of 

21 evidence-based, population-based interventions for 

22 high-risk populations. 

23 ‘‘(2) STATE PLAN.—To be eligible for a grant 

24 under paragraph (1), a State shall submit to the 

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1 ner, and containing such information as the Sec2 retary may require, including a State plan that de3 scribes the interventions to be implemented under 

4 the grant and how such interventions match with 

5 local needs and capabilities, as determined through 

6 consultation with local authorities. 

7 ‘‘(3) USE OF FUNDS.—Funds received under a 

8 grant under this subsection shall be used to imple9 ment interventions that are recommended by the 

10 Task Force on Community Preventive Services (as 

11 established by the Secretary, acting through the Di12 rector of the Centers for Disease Control and Pre13 vention) or other evidence-based interventions, in14 cluding— 

15 ‘‘(A) providing immunization reminders or 

16 recalls for target populations of clients, pa17 tients, and consumers; 

18 ‘‘(B) educating targeted populations and 

19 health care providers concerning immunizations 

20 in combination with one or more other interven21 tions; 

22 ‘‘(C) reducing out-of-pocket costs for fami23 lies for vaccines and their administration; 

24 ‘‘(D) carrying out immunization-promoting 

25 strategies for participants or clients of public 


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1 programs, including assessments of immuniza2 tion status, referrals to health care providers, 

3 education, provision of on-site immunizations, 

4 or incentives for immunization; 

5 ‘‘(E) providing for home visits that pro6 mote immunization through education, assess7 ments of need, referrals, provision of immuniza8 tions, or other services; 

9 ‘‘(F) providing reminders or recalls for im10 munization providers; 

11 ‘‘(G) conducting assessments of, and pro12 viding feedback to, immunization providers; 

13 ‘‘(H) any combination of one or more 

14 interventions described in this paragraph; or 

15 ‘‘(I) immunization information systems to 

16 allow all States to have electronic databases for 

17 immunization records. 

18 ‘‘(4) CONSIDERATION.—In awarding grants 

19 under this subsection, the Secretary shall consider 

20 any reviews or recommendations of the Task Force 

21 on Community Preventive Services. 

22 ‘‘(5) EVALUATION.—Not later than 3 years 

23 after the date on which a State receives a grant 

24 under this subsection, the State shall submit to the 

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1 proving immunization coverage rates among high2 risk populations within the State. 

3 ‘‘(6) REPORT TO CONGRESS.—Not later than 4 

4 years after the date of enactment of the Affordable 

5 Health Choices Act, the Secretary shall submit to 

6 Congress a report concerning the effectiveness of the 

7 demonstration program established under this sub8 section together with recommendations on whether 

9 to continue and expand such program. 

10 ‘‘(7) AUTHORIZATION OF APPROPRIATIONS.— 

11 There is authorized to be appropriated to carry out 

12 this subsection, such sums as may be necessary for 

13 each of fiscal years 2010 through 2014.’’. 

14 (c) REAUTHORIZATION OF IMMUNIZATION PRO15 GRAM.—Section 317(j) of the Public Health Service Act 

16 (42 U.S.C. 247b(j)) is amended— 

17 (1) in paragraph (1), by striking ‘‘for each of 

18 the fiscal years 1998 through 2005’’; and 

19 (2) in paragraph (2), by striking ‘‘after October 

20 1, 1997,’’. 

21 (d) RULE OF CONSTRUCTION REGARDING ACCESS TO

22 IMMUNIZATIONS.—Nothing in this section (including the 

23 amendments made by this section), or any other provision 

24 of this Act (including any amendments made by this Act) 


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1 shall be construed to decrease children’s access to immuni2 zations. 

3 (e) GAO STUDY AND REPORT ON MEDICARE BENE4 FICIARY ACCESS TO VACCINES.— 

5 (1) STUDY.—The Comptroller General of the 

6 United States (in this section referred to as the 

7 ‘‘Comptroller General’’) shall conduct a study on the 

8 ability of Medicare beneficiaries who were 65 years 

9 of age or older to access routinely recommended vac10 cines covered under the prescription drug program 

11 under part D of title XVIII of the Social Security 

12 Act over the period since the establishment of such 

13 program. Such study shall include the following: 

14 (A) An analysis and determination of— 

15 (i) the number of Medicare bene16 ficiaries who were 65 years of age or older 

17 and were eligible for a routinely rec18 ommended vaccination that was covered 

19 under part D; 

20 (ii) the number of such beneficiaries 

21 who actually received a routinely rec22 ommended vaccination that was covered 

23 under part D; and 

24 (iii) any barriers to access by such 

25 beneficiaries to routinely recommended 


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1 vaccinations that were covered under part 

2 D. 

3 (B) A summary of the findings and rec4 ommendations by government agencies, depart5 ments, and advisory bodies (as well as relevant 

6 professional organizations) on the impact of 

7 coverage under part D of routinely rec8 ommended adult immunizations for access to 

9 such immunizations by Medicare beneficiaries. 

10 (2) REPORT.—Not later than June 1, 2011, the 

11 Comptroller General shall submit to the appropriate 

12 committees of jurisdiction of the House of Rep13 resentatives and the Senate a report containing the 

14 results of the study conducted under paragraph (1), 

15 together with recommendations for such legislation 

16 and administrative action as the Comptroller Gen17 eral determines appropriate. 

18 (3) FUNDING.—Out of any funds in the Treas19 ury not otherwise appropriated, there are appro20 priated $1,000,000 for fiscal year 2010 to carry out 

21 this subsection. 


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1 SEC. 4205. NUTRITION LABELING OF STANDARD MENU 

2 ITEMS AT CHAIN RESTAURANTS. 

3 (a) TECHNICAL AMENDMENTS.—Section 

4 403(q)(5)(A) of the Federal Food, Drug, and Cosmetic 

5 Act (21 U.S.C. 343(q)(5)(A)) is amended— 

6 (1) in subitem (i), by inserting at the beginning 

7 ‘‘except as provided in clause (H)(ii)(III),’’; and 

8 (2) in subitem (ii), by inserting at the begin9 ning ‘‘except as provided in clause (H)(ii)(III),’’. 

10 (b) LABELING REQUIREMENTS.—Section 403(q)(5) 

11 of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 

12 343(q)(5)) is amended by adding at the end the following: 

13 ‘‘(H) RESTAURANTS, RETAIL FOOD ESTABLISH14 MENTS, AND VENDING MACHINES.— 

15 ‘‘(i) GENERAL REQUIREMENTS FOR RES16 TAURANTS AND SIMILAR RETAIL FOOD ESTABLISH17 MENTS.—Except for food described in subclause 

18 (vii), in the case of food that is a standard menu 

19 item that is offered for sale in a restaurant or simi20 lar retail food establishment that is part of a chain 

21 with 20 or more locations doing business under the 

22 same name (regardless of the type of ownership of 

23 the locations) and offering for sale substantially the 

24 same menu items, the restaurant or similar retail 

25 food establishment shall disclose the information de26 scribed in subclauses (ii) and (iii). 


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1 ‘‘(ii) INFORMATION REQUIRED TO BE DIS2 CLOSED BY RESTAURANTS AND RETAIL FOOD ES3 TABLISHMENTS.—Except as provided in subclause 

4 (vii), the restaurant or similar retail food establish5 ment shall disclose in a clear and conspicuous man6 ner— 

7 ‘‘(I)(aa) in a nutrient content disclosure 

8 statement adjacent to the name of the standard 

9 menu item, so as to be clearly associated with 

10 the standard menu item, on the menu listing 

11 the item for sale, the number of calories con12 tained in the standard menu item, as usually 

13 prepared and offered for sale; and 

14 ‘‘(bb) a succinct statement concerning sug15 gested daily caloric intake, as specified by the 

16 Secretary by regulation and posted prominently 

17 on the menu and designed to enable the public 

18 to understand, in the context of a total daily 

19 diet, the significance of the caloric information 

20 that is provided on the menu; 

21 ‘‘(II)(aa) in a nutrient content disclosure 

22 statement adjacent to the name of the standard 

23 menu item, so as to be clearly associated with 

24 the standard menu item, on the menu board, 

25 including a drive-through menu board, the 


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1 number of calories contained in the standard 

2 menu item, as usually prepared and offered for 

3 sale; and 

4 ‘‘(bb) a succinct statement concerning sug5 gested daily caloric intake, as specified by the 

6 Secretary by regulation and posted prominently 

7 on the menu board, designed to enable the pub8 lic to understand, in the context of a total daily 

9 diet, the significance of the nutrition informa10 tion that is provided on the menu board; 

11 ‘‘(III) in a written form, available on the prem12 ises of the restaurant or similar retail establishment 

13 and to the consumer upon request, the nutrition in14 formation required under clauses (C) and (D) of 

15 subparagraph (1); and 

16 ‘‘(IV) on the menu or menu board, a promi17 nent, clear, and conspicuous statement regarding the 

18 availability of the information described in item 

19 (III). 

20 ‘‘(iii) SELF-SERVICE FOOD AND FOOD ON DIS21 PLAY.—Except as provided in subclause (vii), in the 

22 case of food sold at a salad bar, buffet line, cafeteria 

23 line, or similar self-service facility, and for self-serv24 ice beverages or food that is on display and that is 

25 visible to customers, a restaurant or similar retail 


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1 food establishment shall place adjacent to each food 

2 offered a sign that lists calories per displayed food 

3 item or per serving. 

4 ‘‘(iv) REASONABLE BASIS.—For the purposes of 

5 this clause, a restaurant or similar retail food estab6 lishment shall have a reasonable basis for its nutri7 ent content disclosures, including nutrient databases, 

8 cookbooks, laboratory analyses, and other reasonable 

9 means, as described in section 101.10 of title 21, 

10 Code of Federal Regulations (or any successor regu11 lation) or in a related guidance of the Food and 

12 Drug Administration. 

13 ‘‘(v) MENU VARIABILITY AND COMBINATION

14 MEALS.—The Secretary shall establish by regulation 

15 standards for determining and disclosing the nutri16 ent content for standard menu items that come in 

17 different flavors, varieties, or combinations, but 

18 which are listed as a single menu item, such as soft 

19 drinks, ice cream, pizza, doughnuts, or children’s 

20 combination meals, through means determined by 

21 the Secretary, including ranges, averages, or other 

22 methods. 

23 ‘‘(vi) ADDITIONAL INFORMATION.—If the Sec24 retary determines that a nutrient, other than a nu25 trient required under subclause (ii)(III), should be 


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1 disclosed for the purpose of providing information to 

2 assist consumers in maintaining healthy dietary 

3 practices, the Secretary may require, by regulation, 

4 disclosure of such nutrient in the written form re5 quired under subclause (ii)(III). 

6 ‘‘(vii) NONAPPLICABILITY TO CERTAIN FOOD.— 

7 ‘‘(I) IN GENERAL.—Subclauses (i) through 

8 (vi) do not apply to— 

9 ‘‘(aa) items that are not listed on a 

10 menu or menu board (such as condiments 

11 and other items placed on the table or 

12 counter for general use); 

13 ‘‘(bb) daily specials, temporary menu 

14 items appearing on the menu for less than 

15 60 days per calendar year, or custom or16 ders; or 

17 ‘‘(cc) such other food that is part of 

18 a customary market test appearing on the 

19 menu for less than 90 days, under terms 

20 and conditions established by the Sec21 retary. 

22 ‘‘(II) WRITTEN FORMS.—Subparagraph 

23 (5)(C) shall apply to any regulations promul24 gated under subclauses (ii)(III) and (vi). 

25 ‘‘(viii) VENDING MACHINES.— 


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1 ‘‘(I) IN GENERAL.—In the case of an arti2 cle of food sold from a vending machine that— 

3 ‘‘(aa) does not permit a prospective 

4 purchaser to examine the Nutrition Facts 

5 Panel before purchasing the article or does 

6 not otherwise provide visible nutrition in7 formation at the point of purchase; and 

8 ‘‘(bb) is operated by a person who is 

9 engaged in the business of owning or oper10 ating 20 or more vending machines, 

11 the vending machine operator shall provide a 

12 sign in close proximity to each article of food or 

13 the selection button that includes a clear and 

14 conspicuous statement disclosing the number of 

15 calories contained in the article. 

16 ‘‘(ix) VOLUNTARY PROVISION OF NUTRITION IN17 FORMATION.— 

18 ‘‘(I) IN GENERAL.—An authorized official 

19 of any restaurant or similar retail food estab20 lishment or vending machine operator not sub21 ject to the requirements of this clause may elect 

22 to be subject to the requirements of such 

23 clause, by registering biannually the name and 

24 address of such restaurant or similar retail food 

25 establishment or vending machine operator with 


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1 the Secretary, as specified by the Secretary by 

2 regulation. 

3 ‘‘(II) REGISTRATION.—Within 120 days of 

4 enactment of this clause, the Secretary shall 

5 publish a notice in the Federal Register speci6 fying the terms and conditions for implementa7 tion of item (I), pending promulgation of regu8 lations. 

9 ‘‘(III) RULE OF CONSTRUCTION.—Nothing 

10 in this subclause shall be construed to authorize 

11 the Secretary to require an application, review, 

12 or licensing process for any entity to register 

13 with the Secretary, as described in such item. 

14 ‘‘(x) REGULATIONS.— 

15 ‘‘(I) PROPOSED REGULATION.—Not later 

16 than 1 year after the date of enactment of this 

17 clause, the Secretary shall promulgate proposed 

18 regulations to carry out this clause. 

19 ‘‘(II) CONTENTS.—In promulgating regula20 tions, the Secretary shall— 

21 ‘‘(aa) consider standardization of rec22 ipes and methods of preparation, reason23 able variation in serving size and formula24 tion of menu items, space on menus and 

25 menu boards, inadvertent human error, 


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1 training of food service workers, variations 

2 in ingredients, and other factors, as the 

3 Secretary determines; and 

4 ‘‘(bb) specify the format and manner 

5 of the nutrient content disclosure require6 ments under this subclause. 

7 ‘‘(III) REPORTING.—The Secretary shall 

8 submit to the Committee on Health, Education, 

9 Labor, and Pensions of the Senate and the 

10 Committee on Energy and Commerce of the 

11 House of Representatives a quarterly report 

12 that describes the Secretary’s progress toward 

13 promulgating final regulations under this sub14 paragraph. 

15 ‘‘(xi) DEFINITION.—In this clause, the term 

16 ‘menu’ or ‘menu board’ means the primary writing 

17 of the restaurant or other similar retail food estab18 lishment from which a consumer makes an order se19 lection.’’ 

20 (c) NATIONAL UNIFORMITY.—Section 403A(a)(4) of 

21 the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 

22 343-1(a)(4)) is amended by striking ‘‘except a require23 ment for nutrition labeling of food which is exempt under 

24 subclause (i) or (ii) of section 403(q)(5)(A)’’ and inserting 

25 ‘‘except that this paragraph does not apply to food that 


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1 is offered for sale in a restaurant or similar retail food 

2 establishment that is not part of a chain with 20 or more 

3 locations doing business under the same name (regardless 

4 of the type of ownership of the locations) and offering for 

5 sale substantially the same menu items unless such res6 taurant or similar retail food establishment complies with 

7 the voluntary provision of nutrition information require8 ments under section 403(q)(5)(H)(ix)’’. 

9 (d) RULE OF CONSTRUCTION.—Nothing in the 

10 amendments made by this section shall be construed— 

11 (1) to preempt any provision of State or local 

12 law, unless such provision establishes or continues 

13 into effect nutrient content disclosures of the type 

14 required under section 403(q)(5)(H) of the Federal 

15 Food, Drug, and Cosmetic Act (as added by sub16 section (b)) and is expressly preempted under sub17 section (a)(4) of such section; 

18 (2) to apply to any State or local requirement 

19 respecting a statement in the labeling of food that 

20 provides for a warning concerning the safety of the 

21 food or component of the food; or 

22 (3) except as provided in section 

23 403(q)(5)(H)(ix) of the Federal Food, Drug, and 

24 Cosmetic Act (as added by subsection (b)), to apply 

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1 ment other than a restaurant or similar retail food 

2 establishment described in section 403(q)(5)(H)(i) of 

3 such Act. 

4 SEC. 4206. DEMONSTRATION PROJECT CONCERNING INDI5 VIDUALIZED WELLNESS PLAN. 

6 Section 330 of the Public Health Service Act (42 

7 U.S.C. 245b) is amended by adding at the end the fol8 lowing: 

9 ‘‘(s) DEMONSTRATION PROGRAM FOR INDIVIDUAL10 IZED WELLNESS PLANS.— 

11 ‘‘(1) IN GENERAL.—The Secretary shall estab12 lish a pilot program to test the impact of providing 

13 at-risk populations who utilize community health 

14 centers funded under this section an individualized 

15 wellness plan that is designed to reduce risk factors 

16 for preventable conditions as identified by a com17 prehensive risk-factor assessment. 

18 ‘‘(2) AGREEMENTS.—The Secretary shall enter 

19 into agreements with not more than 10 community 

20 health centers funded under this section to conduct 

21 activities under the pilot program under paragraph 

22 (1). 

23 ‘‘(3) WELLNESS PLANS.— 

24 ‘‘(A) IN GENERAL.—An individualized 

25 wellness plan prepared under the pilot program 


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1 under this subsection may include one or more 

2 of the following as appropriate to the individ3 ual’s identified risk factors: 

4 ‘‘(i) Nutritional counseling. 

5 ‘‘(ii) A physical activity plan. 

6 ‘‘(iii) Alcohol and smoking cessation 

7 counseling and services. 

8 ‘‘(iv) Stress management. 

9 ‘‘(v) Dietary supplements that have 

10 health claims approved by the Secretary. 

11 ‘‘(vi) Compliance assistance provided 

12 by a community health center employee. 

13 ‘‘(B) RISK FACTORS.—Wellness plan risk 

14 factors shall include— 

15 ‘‘(i) weight; 

16 ‘‘(ii) tobacco and alcohol use; 

17 ‘‘(iii) exercise rates; 

18 ‘‘(iv) nutritional status; and 

19 ‘‘(v) blood pressure. 

20 ‘‘(C) COMPARISONS.—Individualized 

21 wellness plans shall make comparisons between 

22 the individual involved and a control group of 

23 individuals with respect to the risk factors de24 scribed in subparagraph (B). 


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1 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

2 There is authorized to be appropriated to carry out 

3 this subsection, such sums as may be necessary.’’. 

4 SEC. 4207. REASONABLE BREAK TIME FOR NURSING MOTH5 ERS. 

6 Section 7 of the Fair Labor Standards Act of 1938 

7 (29 U.S.C. 207) is amended by adding at the end the fol8 lowing: 

9 ‘‘(r)(1) An employer shall provide— 

10 ‘‘(A) a reasonable break time for an employee 

11 to express breast milk for her nursing child for 1 

12 year after the child’s birth each time such employee 

13 has need to express the milk; and 

14 ‘‘(B) a place, other than a bathroom, that is 

15 shielded from view and free from intrusion from co16 workers and the public, which may be used by an 

17 employee to express breast milk. 

18 ‘‘(2) An employer shall not be required to compensate 

19 an employee receiving reasonable break time under para20 graph (1) for any work time spent for such purpose. 

21 ‘‘(3) An employer that employs less than 50 employ22 ees shall not be subject to the requirements of this sub23 section, if such requirements would impose an undue hard24 ship by causing the employer significant difficulty or exVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01239 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pense when considered in relation to the size, financial re2 sources, nature, or structure of the employer’s business. 

3 ‘‘(4) Nothing in this subsection shall preempt a State 

4 law that provides greater protections to employees than 

5 the protections provided for under this subsection.’’. 

6 Subtitle D—Support for Prevention 

7 and Public Health Innovation 

8 SEC. 4301. RESEARCH ON OPTIMIZING THE DELIVERY OF 

9 PUBLIC HEALTH SERVICES. 

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

11 Human Services (referred to in this section as the ‘‘Sec12 retary’’), acting through the Director of the Centers for 

13 Disease Control and Prevention, shall provide funding for 

14 research in the area of public health services and systems. 

15 (b) REQUIREMENTS OF RESEARCH.—Research sup16 ported under this section shall include— 

17 (1) examining evidence-based practices relating 

18 to prevention, with a particular focus on high pri19 ority areas as identified by the Secretary in the Na20 tional Prevention Strategy or Healthy People 2020, 

21 and including comparing community-based public 

22 health interventions in terms of effectiveness and 

23 cost; 

24 (2) analyzing the translation of interventions 

25 from academic settings to real world settings; and 


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1 (3) identifying effective strategies for orga2 nizing, financing, or delivering public health services 

3 in real world community settings, including com4 paring State and local health department structures 

5 and systems in terms of effectiveness and cost. 

6 (c) EXISTING PARTNERSHIPS.—Research supported 

7 under this section shall be coordinated with the Commu8 nity Preventive Services Task Force and carried out by 

9 building on existing partnerships within the Federal Gov10 ernment while also considering initiatives at the State and 

11 local levels and in the private sector. 

12 (d) ANNUAL REPORT.—The Secretary shall, on an 

13 annual basis, submit to Congress a report concerning the 

14 activities and findings with respect to research supported 

15 under this section. 

16 SEC. 4302. UNDERSTANDING HEALTH DISPARITIES: DATA 

17 COLLECTION AND ANALYSIS. 

18 (a) UNIFORM CATEGORIES AND COLLECTION RE19 QUIREMENTS.—The Public Health Service Act (42 U.S.C. 

20 201 et seq.) is amended by adding at the end the fol21 lowing: 


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1 ‘‘TITLE XXXI—DATA COLLEC2 TION, ANALYSIS, AND QUAL3 ITY 

4 ‘‘SEC. 3101. DATA COLLECTION, ANALYSIS, AND QUALITY. 

5 ‘‘(a) DATA COLLECTION.— 

6 ‘‘(1) IN GENERAL.—The Secretary shall ensure 

7 that, by not later than 2 years after the date of en8 actment of this title, any federally conducted or sup9 ported health care or public health program, activity 

10 or survey (including Current Population Surveys and 

11 American Community Surveys conducted by the Bu12 reau of Labor Statistics and the Bureau of the Cen13 sus) collects and reports, to the extent practicable— 

14 ‘‘(A) data on race, ethnicity, sex, primary 

15 language, and disability status for applicants, 

16 recipients, or participants; 

17 ‘‘(B) data at the smallest geographic level 

18 such as State, local, or institutional levels if 

19 such data can be aggregated; 

20 ‘‘(C) sufficient data to generate statis21 tically reliable estimates by racial, ethnic, sex, 

22 primary language, and disability status sub23 groups for applicants, recipients or participants 

24 using, if needed, statistical oversamples of these 

25 subpopulations; and 


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1 ‘‘(D) any other demographic data as 

2 deemed appropriate by the Secretary regarding 

3 health disparities. 

4 ‘‘(2) COLLECTION STANDARDS.—In collecting 

5 data described in paragraph (1), the Secretary or 

6 designee shall— 

7 ‘‘(A) use Office of Management and Budg8 et standards, at a minimum, for race and eth9 nicity measures; 

10 ‘‘(B) develop standards for the measure11 ment of sex, primary language, and disability 

12 status; 

13 ‘‘(C) develop standards for the collection of 

14 data described in paragraph (1) that, at a min15 imum— 

16 ‘‘(i) collects self-reported data by the 

17 applicant, recipient, or participant; and 

18 ‘‘(ii) collects data from a parent or 

19 legal guardian if the applicant, recipient, 

20 or participant is a minor or legally inca21 pacitated; 

22 ‘‘(D) survey health care providers and es23 tablish other procedures in order to assess ac24 cess to care and treatment for individuals with 

25 disabilities and to identify— 


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1 ‘‘(i) locations where individuals with 

2 disabilities access primary, acute (including 

3 intensive), and long-term care; 

4 ‘‘(ii) the number of providers with ac5 cessible facilities and equipment to meet 

6 the needs of the individuals with disabil7 ities, including medical diagnostic equip8 ment that meets the minimum technical 

9 criteria set forth in section 510 of the Re10 habilitation Act of 1973; and 

11 ‘‘(iii) the number of employees of 

12 health care providers trained in disability 

13 awareness and patient care of individuals 

14 with disabilities; and 

15 ‘‘(E) require that any reporting require16 ment imposed for purposes of measuring quality 

17 under any ongoing or federally conducted or 

18 supported health care or public health program, 

19 activity, or survey includes requirements for the 

20 collection of data on individuals receiving health 

21 care items or services under such programs ac22 tivities by race, ethnicity, sex, primary lan23 guage, and disability status. 

24 ‘‘(3) DATA MANAGEMENT.—In collecting data 

25 described in paragraph (1), the Secretary, acting 


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1 through the National Coordinator for Health Infor2 mation Technology shall— 

3 ‘‘(A) develop national standards for the 

4 management of data collected; and 

5 ‘‘(B) develop interoperability and security 

6 systems for data management. 

7 ‘‘(b) DATA ANALYSIS.— 

8 ‘‘(1) IN GENERAL.—For each federally con9 ducted or supported health care or public health pro10 gram or activity, the Secretary shall analyze data 

11 collected under paragraph (a) to detect and monitor 

12 trends in health disparities (as defined for purposes 

13 of section 485E) at the Federal and State levels. 

14 ‘‘(c) DATA REPORTING AND DISSEMINATION.— 

15 ‘‘(1) IN GENERAL.—The Secretary shall make 

16 the analyses described in (b) available to— 

17 ‘‘(A) the Office of Minority Health; 

18 ‘‘(B) the National Center on Minority 

19 Health and Health Disparities; 

20 ‘‘(C) the Agency for Healthcare Research 

21 and Quality; 

22 ‘‘(D) the Centers for Disease Control and 

23 Prevention; 

24 ‘‘(E) the Centers for Medicare & Medicaid 

25 Services; 


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1 ‘‘(F) the Indian Health Service and epide2 miology centers funded under the Indian Health 

3 Care Improvement Act; 

4 ‘‘(G) the Office of Rural health; 

5 ‘‘(H) other agencies within the Department 

6 of Health and Human Services; and 

7 ‘‘(I) other entities as determined appro8 priate by the Secretary. 

9 ‘‘(2) REPORTING OF DATA.—The Secretary 

10 shall report data and analyses described in (a) and 

11 (b) through— 

12 ‘‘(A) public postings on the Internet 

13 websites of the Department of Health and 

14 Human Services; and 

15 ‘‘(B) any other reporting or dissemination 

16 mechanisms determined appropriate by the Sec17 retary. 

18 ‘‘(3) AVAILABILITY OF DATA.—The Secretary 

19 may make data described in (a) and (b) available for 

20 additional research, analyses, and dissemination to 

21 other Federal agencies, non-governmental entities, 

22 and the public, in accordance with any Federal agen23 cy’s data user agreements. 

24 ‘‘(d) LIMITATIONS ON USE OF DATA.—Nothing in 

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1 mation collected under this section in a manner that would 

2 adversely affect any individual. 

3 ‘‘(e) PROTECTION AND SHARING OF DATA.— 

4 ‘‘(1) PRIVACY AND OTHER SAFEGUARDS.—The 

5 Secretary shall ensure (through the promulgation of 

6 regulations or otherwise) that— 

7 ‘‘(A) all data collected pursuant to sub8 section (a) is protected— 

9 ‘‘(i) under privacy protections that are 

10 at least as broad as those that the Sec11 retary applies to other health data under 

12 the regulations promulgated under section 

13 264(c) of the Health Insurance Portability 

14 and Accountability Act of 1996 (Public 

15 Law 104-191; 110 Stat. 2033); and 

16 ‘‘(ii) from all inappropriate internal 

17 use by any entity that collects, stores, or 

18 receives the data, including use of such 

19 data in determinations of eligibility (or 

20 continued eligibility) in health plans, and 

21 from other inappropriate uses, as defined 

22 by the Secretary; and 

23 ‘‘(B) all appropriate information security 

24 safeguards are used in the collection, analysis, 


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1 and sharing of data collected pursuant to sub2 section (a). 

3 ‘‘(2) DATA SHARING.—The Secretary shall es4 tablish procedures for sharing data collected pursu5 ant to subsection (a), measures relating to such 

6 data, and analyses of such data, with other relevant 

7 Federal and State agencies including the agencies, 

8 centers, and entities within the Department of 

9 Health and Human Services specified in subsection 

10 (c)(1).. 

11 ‘‘(f) DATA ON RURAL UNDERSERVED POPU12 LATIONS.—The Secretary shall ensure that any data col13 lected in accordance with this section regarding racial and 

14 ethnic minority groups are also collected regarding under15 served rural and frontier populations. 

16 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—For the 

17 purpose of carrying out this section, there are authorized 

18 to be appropriated such sums as may be necessary for 

19 each of fiscal years 2010 through 2014. 

20 ‘‘(h) REQUIREMENT FOR IMPLEMENTATION.—Not21 withstanding any other provision of this section, data may 

22 not be collected under this section unless funds are di23 rectly appropriated for such purpose in an appropriations 

24 Act. 


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1 ‘‘(i) CONSULTATION.—The Secretary shall consult 

2 with the Director of the Office of Personnel Management, 

3 the Secretary of Defense, the Secretary of Veterans Af4 fairs, the Director of the Bureau of the Census, the Com5 missioner of Social Security, and the head of other appro6 priate Federal agencies in carrying out this section.’’. 

7 (b) ADDRESSING HEALTH CARE DISPARITIES IN

8 MEDICAID AND CHIP.— 

9 (1) STANDARDIZED COLLECTION REQUIRE10 MENTS INCLUDED IN STATE PLANS.— 

11 (A) MEDICAID.—Section 1902(a) of the 

12 Social Security Act (42 U.S.C. 1396a(a)), as 

13 amended by section 2001(d), is amended— 

14 (i) in paragraph 4), by striking ‘‘and’’ 

15 at the end; 

16 (ii) in paragraph (75), by striking the 

17 period at the end and inserting ‘‘; and’’; 

18 and 

19 (iii) by inserting after paragraph (75) 

20 the following new paragraph: 

21 ‘‘(76) provide that any data collected under the 

22 State plan meets the requirements of section 3101 

23 of the Public Health Service Act.’’. 

24 (B) CHIP.—Section 2108(e) of the Social 

25 Security Act (42 U.S.C. 1397hh(e)) is amended 


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1 by adding at the end the following new para2 graph: 

3 ‘‘(7) Data collected and reported in accordance 

4 with section 3101 of the Public Health Service Act, 

5 with respect to individuals enrolled in the State child 

6 health plan (and, in the case of enrollees under 19 

7 years of age, their parents or legal guardians), in8 cluding data regarding the primary language of such 

9 individuals, parents, and legal guardians.’’. 

10 (2) EXTENDING MEDICARE REQUIREMENT TO

11 ADDRESS HEALTH DISPARITIES DATA COLLECTION

12 TO MEDICAID AND CHIP.—Title XIX of the Social 

13 Security Act (42 U.S.C. 1396 et seq.), as amended 

14 by section 2703 is amended by adding at the end the 

15 following new section: 

16 ‘‘SEC. 1946. ADDRESSING HEALTH CARE DISPARITIES. 

17 ‘‘(a) EVALUATING DATA COLLECTION AP18 PROACHES.—The Secretary shall evaluate approaches for 

19 the collection of data under this title and title XXI, to 

20 be performed in conjunction with existing quality report21 ing requirements and programs under this title and title 

22 XXI, that allow for the ongoing, accurate, and timely col23 lection and evaluation of data on disparities in health care 

24 services and performance on the basis of race, ethnicity, 

25 sex, primary language, and disability status. In conducting 


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1 such evaluation, the Secretary shall consider the following 

2 objectives: 

3 ‘‘(1) Protecting patient privacy. 

4 ‘‘(2) Minimizing the administrative burdens of 

5 data collection and reporting on States, providers, 

6 and health plans participating under this title or 

7 title XXI. 

8 ‘‘(3) Improving program data under this title 

9 and title XXI on race, ethnicity, sex, primary lan10 guage, and disability status. 

11 ‘‘(b) REPORTS TO CONGRESS.— 

12 ‘‘(1) REPORT ON EVALUATION.—Not later than 

13 18 months after the date of the enactment of this 

14 section, the Secretary shall submit to Congress a re15 port on the evaluation conducted under subsection 

16 (a). Such report shall, taking into consideration the 

17 results of such evaluation— 

18 ‘‘(A) identify approaches (including defin19 ing methodologies) for identifying and collecting 

20 and evaluating data on health care disparities 

21 on the basis of race, ethnicity, sex, primary lan22 guage, and disability status for the programs 

23 under this title and title XXI; and 

24 ‘‘(B) include recommendations on the most 

25 effective strategies and approaches to reporting 


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1 HEDIS quality measures as required under sec2 tion 1852(e)(3) and other nationally recognized 

3 quality performance measures, as appropriate, 

4 on such bases. 

5 ‘‘(2) REPORTS ON DATA ANALYSES.—Not later 

6 than 4 years after the date of the enactment of this 

7 section, and 4 years thereafter, the Secretary shall 

8 submit to Congress a report that includes rec9 ommendations for improving the identification of 

10 health care disparities for beneficiaries under this 

11 title and under title XXI based on analyses of the 

12 data collected under subsection (c). 

13 ‘‘(c) IMPLEMENTING EFFECTIVE APPROACHES.—Not 

14 later than 24 months after the date of the enactment of 

15 this section, the Secretary shall implement the approaches 

16 identified in the report submitted under subsection (b)(1) 

17 for the ongoing, accurate, and timely collection and eval18 uation of data on health care disparities on the basis of 

19 race, ethnicity, sex, primary language, and disability sta20 tus.’’. 

21 SEC. 4303. CDC AND EMPLOYER-BASED WELLNESS PRO22 GRAMS. 

23 Title III of the Public Health Service Act (42 U.S.C. 

24 241 et seq.), by section 4102, is further amended by add25 ing at the end the following: 


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1 ‘‘PART U—EMPLOYER-BASED WELLNESS 

2 PROGRAM 

3 ‘‘SEC. 399MM. TECHNICAL ASSISTANCE FOR EMPLOYER4 BASED WELLNESS PROGRAMS. 

5 ‘‘In order to expand the utilization of evidence-based 

6 prevention and health promotion approaches in the work7 place, the Director shall— 

8 ‘‘(1) provide employers (including small, me9 dium, and large employers, as determined by the Di10 rector) with technical assistance, consultation, tools, 

11 and other resources in evaluating such employers’ 

12 employer-based wellness programs, including— 

13 ‘‘(A) measuring the participation and 

14 methods to increase participation of employees 

15 in such programs; 

16 ‘‘(B) developing standardized measures 

17 that assess policy, environmental and systems 

18 changes necessary to have a positive health im19 pact on employees’ health behaviors, health out20 comes, and health care expenditures; and 

21 ‘‘(C) evaluating such programs as they re22 late to changes in the health status of employ23 ees, the absenteeism of employees, the produc24 tivity of employees, the rate of workplace in25 jury, and the medical costs incurred by employ26 ees; and 


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1 ‘‘(2) build evaluation capacity among workplace 

2 staff by training employers on how to evaluate em3 ployer-based wellness programs by ensuring evalua4 tion resources, technical assistance, and consultation 

5 are available to workplace staff as needed through 

6 such mechanisms as web portals, call centers, or 

7 other means. 

8 ‘‘SEC. 399MM-1. NATIONAL WORKSITE HEALTH POLICIES 

9 AND PROGRAMS STUDY. 

10 ‘‘(a) IN GENERAL.—In order to assess, analyze, and 

11 monitor over time data about workplace policies and pro12 grams, and to develop instruments to assess and evaluate 

13 comprehensive workplace chronic disease prevention and 

14 health promotion programs, policies and practices, not 

15 later than 2 years after the date of enactment of this part, 

16 and at regular intervals (to be determined by the Director) 

17 thereafter, the Director shall conduct a national worksite 

18 health policies and programs survey to assess employer19 based health policies and programs. 

20 ‘‘(b) REPORT.—Upon the completion of each study 

21 under subsection (a), the Director shall submit to Con22 gress a report that includes the recommendations of the 

23 Director for the implementation of effective employer24 based health policies and programs. 


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1 ‘‘SEC. 399MM–2. PRIORITIZATION OF EVALUATION BY SEC2 RETARY. 

3 ‘‘The Secretary shall evaluate, in accordance with this 

4 part, all programs funded through the Centers for Disease 

5 Control and Prevention before conducting such an evalua6 tion of privately funded programs unless an entity with 

7 a privately funded wellness program requests such an eval8 uation. 

9 ‘‘SEC. 399MM–3. PROHIBITION OF FEDERAL WORKPLACE 

10 WELLNESS REQUIREMENTS. 

11 ‘‘Notwithstanding any other provision of this part, 

12 any recommendations, data, or assessments carried out 

13 under this part shall not be used to mandate requirements 

14 for workplace wellness programs.’’. 

15 SEC. 4304. EPIDEMIOLOGY-LABORATORY CAPACITY 

16 GRANTS. 

17 Title XXVIII of the Public Health Service Act (42 

18 U.S.C. 300hh et seq.) is amended by adding at the end 

19 the following: 

20 ‘‘Subtitle C—Strengthening Public 

21 Health Surveillance Systems 

22 ‘‘SEC. 2821. EPIDEMIOLOGY-LABORATORY CAPACITY 

23 GRANTS. 

24 ‘‘(a) IN GENERAL.—Subject to the availability of ap25 propriations, the Secretary, acting through the Director 

26 of the Centers for Disease Control and Prevention, shall 


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1 establish an Epidemiology and Laboratory Capacity Grant 

2 Program to award grants to State health departments as 

3 well as local health departments and tribal jurisdictions 

4 that meet such criteria as the Director determines appro5 priate. Academic centers that assist State and eligible 

6 local and tribal health departments may also be eligible 

7 for funding under this section as the Director determines 

8 appropriate. Grants shall be awarded under this section 

9 to assist public health agencies in improving surveillance 

10 for, and response to, infectious diseases and other condi11 tions of public health importance by— 

12 ‘‘(1) strengthening epidemiologic capacity to 

13 identify and monitor the occurrence of infectious dis14 eases and other conditions of public health impor15 tance; 

16 ‘‘(2) enhancing laboratory practice as well as 

17 systems to report test orders and results electroni18 cally; 

19 ‘‘(3) improving information systems including 

20 developing and maintaining an information exchange 

21 using national guidelines and complying with capac22 ities and functions determined by an advisory coun23 cil established and appointed by the Director; and 

24 ‘‘(4) developing and implementing prevention 

25 and control strategies. 


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1 ‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There 

2 are authorized to be appropriated to carry out this section 

3 $190,000,000 for each of fiscal years 2010 through 2013, 

4 of which— 

5 ‘‘(1) not less than $95,000,000 shall be made 

6 available each such fiscal year for activities under 

7 paragraphs (1) and (4) of subsection (a); 

8 ‘‘(2) not less than $60,000,000 shall be made 

9 available each such fiscal year for activities under 

10 subsection (a)(3); and 

11 ‘‘(3) not less than $32,000,000 shall be made 

12 available each such fiscal year for activities under 

13 subsection (a)(2).’’. 

14 SEC. 4305. ADVANCING RESEARCH AND TREATMENT FOR 

15 PAIN CARE MANAGEMENT. 

16 (a) INSTITUTE OF MEDICINE CONFERENCE ON

17 PAIN.— 

18 (1) CONVENING.—Not later than 1 year after 

19 funds are appropriated to carry out this subsection, 

20 the Secretary of Health and Human Services shall 

21 seek to enter into an agreement with the Institute 

22 of Medicine of the National Academies to convene a 

23 Conference on Pain (in this subsection referred to as 

24 ‘‘the Conference’’). 


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1 (2) PURPOSES.—The purposes of the Con2 ference shall be to— 

3 (A) increase the recognition of pain as a 

4 significant public health problem in the United 

5 States; 

6 (B) evaluate the adequacy of assessment, 

7 diagnosis, treatment, and management of acute 

8 and chronic pain in the general population, and 

9 in identified racial, ethnic, gender, age, and 

10 other demographic groups that may be dis11 proportionately affected by inadequacies in the 

12 assessment, diagnosis, treatment, and manage13 ment of pain; 

14 (C) identify barriers to appropriate pain 

15 care; 

16 (D) establish an agenda for action in both 

17 the public and private sectors that will reduce 

18 such barriers and significantly improve the 

19 state of pain care research, education, and clin20 ical care in the United States. 

21 (3) OTHER APPROPRIATE ENTITY.—If the In22 stitute of Medicine declines to enter into an agree23 ment under paragraph (1), the Secretary of Health 

24 and Human Services may enter into such agreement 

25 with another appropriate entity. 


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1 (4) REPORT.—A report summarizing the Con2 ference’s findings and recommendations shall be 

3 submitted to the Congress not later than June 30, 

4 2011. 

5 (5) AUTHORIZATION OF APPROPRIATIONS.—For 

6 the purpose of carrying out this subsection, there is 

7 authorized to be appropriated such sums as may be 

8 necessary for each of fiscal years 2010 and 2011. 

9 (b) PAIN RESEARCH AT NATIONAL INSTITUTES OF

10 HEALTH.—Part B of title IV of the Public Health Service 

11 Act (42 U.S.C. 284 et seq.) is amended by adding at the 

12 end the following: 

13 ‘‘SEC. 409J. PAIN RESEARCH. 

14 ‘‘(a) RESEARCH INITIATIVES.— 

15 ‘‘(1) IN GENERAL.—The Director of NIH is en16 couraged to continue and expand, through the Pain 

17 Consortium, an aggressive program of basic and 

18 clinical research on the causes of and potential treat19 ments for pain. 

20 ‘‘(2) ANNUAL RECOMMENDATIONS.—Not less 

21 than annually, the Pain Consortium, in consultation 

22 with the Division of Program Coordination, Plan23 ning, and Strategic Initiatives, shall develop and 

24 submit to the Director of NIH recommendations on 

25 appropriate pain research initiatives that could be 


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1 undertaken with funds reserved under section 

2 402A(c)(1) for the Common Fund or otherwise 

3 available for such initiatives. 

4 ‘‘(3) DEFINITION.—In this subsection, the term 

5 ‘Pain Consortium’ means the Pain Consortium of 

6 the National Institutes of Health or a similar trans7 National Institutes of Health coordinating entity 

8 designated by the Secretary for purposes of this sub9 section. 

10 ‘‘(b) INTERAGENCY PAIN RESEARCH COORDINATING

11 COMMITTEE.— 

12 ‘‘(1) ESTABLISHMENT.—The Secretary shall es13 tablish not later than 1 year after the date of the 

14 enactment of this section and as necessary maintain 

15 a committee, to be known as the Interagency Pain 

16 Research Coordinating Committee (in this section 

17 referred to as the ‘Committee’), to coordinate all ef18 forts within the Department of Health and Human 

19 Services and other Federal agencies that relate to 

20 pain research. 

21 ‘‘(2) MEMBERSHIP.— 

22 ‘‘(A) IN GENERAL.—The Committee shall 

23 be composed of the following voting members: 

24 ‘‘(i) Not more than 7 voting Federal 

25 representatives appoint by the Secretary 


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1 from agencies that conduct pain care re2 search and treatment. 

3 ‘‘(ii) 12 additional voting members ap4 pointed under subparagraph (B). 

5 ‘‘(B) ADDITIONAL MEMBERS.—The Com6 mittee shall include additional voting members 

7 appointed by the Secretary as follows: 

8 ‘‘(i) 6 non-Federal members shall be 

9 appointed from among scientists, physi10 cians, and other health professionals. 

11 ‘‘(ii) 6 members shall be appointed 

12 from members of the general public, who 

13 are representatives of leading research, ad14 vocacy, and service organizations for indi15 viduals with pain-related conditions. 

16 ‘‘(C) NONVOTING MEMBERS.—The Com17 mittee shall include such nonvoting members as 

18 the Secretary determines to be appropriate. 

19 ‘‘(3) CHAIRPERSON.—The voting members of 

20 the Committee shall select a chairperson from 

21 among such members. The selection of a chairperson 

22 shall be subject to the approval of the Director of 

23 NIH. 

24 ‘‘(4) MEETINGS.—The Committee shall meet at 

25 the call of the chairperson of the Committee or upon 


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1 the request of the Director of NIH, but in no case 

2 less often than once each year. 

3 ‘‘(5) DUTIES.—The Committee shall— 

4 ‘‘(A) develop a summary of advances in 

5 pain care research supported or conducted by 

6 the Federal agencies relevant to the diagnosis, 

7 prevention, and treatment of pain and diseases 

8 and disorders associated with pain; 

9 ‘‘(B) identify critical gaps in basic and 

10 clinical research on the symptoms and causes of 

11 pain; 

12 ‘‘(C) make recommendations to ensure that 

13 the activities of the National Institutes of 

14 Health and other Federal agencies are free of 

15 unnecessary duplication of effort; 

16 ‘‘(D) make recommendations on how best 

17 to disseminate information on pain care; and 

18 ‘‘(E) make recommendations on how to ex19 pand partnerships between public entities and 

20 private entities to expand collaborative, cross21 cutting research. 

22 ‘‘(6) REVIEW.—The Secretary shall review the 

23 necessity of the Committee at least once every 2 

24 years.’’. 


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1 (c) PAIN CARE EDUCATION AND TRAINING.—Part D 

2 of title VII of the Public Health Service Act (42 U.S.C. 

3 294 et seq.) is amended by adding at the end the following 

4 new section: 

5 ‘‘SEC. 759. PROGRAM FOR EDUCATION AND TRAINING IN 

6 PAIN CARE. 

7 ‘‘(a) IN GENERAL.—The Secretary may make awards 

8 of grants, cooperative agreements, and contracts to health 

9 professions schools, hospices, and other public and private 

10 entities for the development and implementation of pro11 grams to provide education and training to health care 

12 professionals in pain care. 

13 ‘‘(b) CERTAIN TOPICS.—An award may be made 

14 under subsection (a) only if the applicant for the award 

15 agrees that the program carried out with the award will 

16 include information and education on— 

17 ‘‘(1) recognized means for assessing, diag18 nosing, treating, and managing pain and related 

19 signs and symptoms, including the medically appro20 priate use of controlled substances; 

21 ‘‘(2) applicable laws, regulations, rules, and 

22 policies on controlled substances, including the de23 gree to which misconceptions and concerns regarding 

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1 forcement thereof, may create barriers to patient ac2 cess to appropriate and effective pain care; 

3 ‘‘(3) interdisciplinary approaches to the delivery 

4 of pain care, including delivery through specialized 

5 centers providing comprehensive pain care treatment 

6 expertise; 

7 ‘‘(4) cultural, linguistic, literacy, geographic, 

8 and other barriers to care in underserved popu9 lations; and 

10 ‘‘(5) recent findings, developments, and im11 provements in the provision of pain care. 

12 ‘‘(c) EVALUATION OF PROGRAMS.—The Secretary 

13 shall (directly or through grants or contracts) provide for 

14 the evaluation of programs implemented under subsection 

15 (a) in order to determine the effect of such programs on 

16 knowledge and practice of pain care. 

17 ‘‘(d) PAIN CARE DEFINED.—For purposes of this 

18 section the term ‘pain care’ means the assessment, diag19 nosis, treatment, or management of acute or chronic pain 

20 regardless of causation or body location. 

21 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

22 is authorized to be appropriated to carry out this section, 

23 such sums as may be necessary for each of the fiscal years 

24 2010 through 2012. Amounts appropriated under this 

25 subsection shall remain available until expended.’’. 


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1 SEC. 4306. FUNDING FOR CHILDHOOD OBESITY DEM2 ONSTRATION PROJECT. 

3 Section 1139A(e)(8) of the Social Security Act (42 

4 U.S.C. 1320b–9a(e)(8)) is amended to read as follows: 

5 ‘‘(8) APPROPRIATION.—Out of any funds in the 

6 Treasury not otherwise appropriated, there is appro7 priated to carry out this subsection, $25,000,000 for 

8 the period of fiscal years 2010 through 2014.’’. 

9 Subtitle E—Miscellaneous 

10 Provisions 

11 SEC. 4401. SENSE OF THE SENATE CONCERNING CBO SCOR12 ING. 

13 (a) FINDING.—The Senate finds that the costs of 

14 prevention programs are difficult to estimate due in part 

15 because prevention initiatives are hard to measure and re16 sults may occur outside the 5 and 10 year budget win17 dows. 

18 (b) SENSE OF CONGRESS.—It is the sense of the Sen19 ate that Congress should work with the Congressional 

20 Budget Office to develop better methodologies for scoring 

21 progress to be made in prevention and wellness programs. 

22 SEC. 4402. EFFECTIVENESS OF FEDERAL HEALTH AND 

23 WELLNESS INITIATIVES. 

24 To determine whether existing Federal health and 

25 wellness initiatives are effective in achieving their stated 


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1 goals, the Secretary of Health and Human Services 

2 shall— 

3 (1) conduct an evaluation of such programs as 

4 they relate to changes in health status of the Amer5 ican public and specifically on the health status of 

6 the Federal workforce, including absenteeism of em7 ployees, the productivity of employees, the rate of 

8 workplace injury, and the medical costs incurred by 

9 employees, and health conditions, including work10 place fitness, healthy food and beverages, and incen11 tives in the Federal Employee Health Benefits Pro12 gram; and 

13 (2) submit to Congress a report concerning 

14 such evaluation, which shall include conclusions con15 cerning the reasons that such existing programs 

16 have proven successful or not successful and what 

17 factors contributed to such conclusions. 

18 TITLE V—HEALTH CARE 

19 WORKFORCE 

20 Subtitle A—Purpose and 

21 Definitions 

22 SEC. 5001. PURPOSE. 

23 The purpose of this title is to improve access to and 

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1 ticularly low income, underserved, uninsured, minority, 

2 health disparity, and rural populations by— 

3 (1) gathering and assessing comprehensive data 

4 in order for the health care workforce to meet the 

5 health care needs of individuals, including research 

6 on the supply, demand, distribution, diversity, and 

7 skills needs of the health care workforce; 

8 (2) increasing the supply of a qualified health 

9 care workforce to improve access to and the delivery 

10 of health care services for all individuals; 

11 (3) enhancing health care workforce education 

12 and training to improve access to and the delivery 

13 of health care services for all individuals; and 

14 (4) providing support to the existing health care 

15 workforce to improve access to and the delivery of 

16 health care services for all individuals. 

17 SEC. 5002. DEFINITIONS. 

18 (a) THIS TITLE.—In this title: 

19 (1) ALLIED HEALTH PROFESSIONAL.—The 

20 term ‘‘allied health professional’’ means an allied 

21 health professional as defined in section 799B(5) of 

22 the Public Heath Service Act (42 U.S.C. 295p(5)) 

23 who— 


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1 (A) has graduated and received an allied 

2 health professions degree or certificate from an 

3 institution of higher education; and 

4 (B) is employed with a Federal, State, 

5 local or tribal public health agency, or in a set6 ting where patients might require health care 

7 services, including acute care facilities, ambula8 tory care facilities, personal residences, and 

9 other settings located in health professional 

10 shortage areas, medically underserved areas, or 

11 medically underserved populations, as recog12 nized by the Secretary of Health and Human 

13 Services. 

14 (2) HEALTH CARE CAREER PATHWAY.—The 

15 term ‘‘healthcare career pathway’’ means a rigorous, 

16 engaging, and high quality set of courses and serv17 ices that— 

18 (A) includes an articulated sequence of 

19 academic and career courses, including 21st 

20 century skills; 

21 (B) is aligned with the needs of healthcare 

22 industries in a region or State; 

23 (C) prepares students for entry into the 

24 full range of postsecondary education options, 


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1 including registered apprenticeships, and ca2 reers; 

3 (D) provides academic and career coun4 seling in student-to-counselor ratios that allow 

5 students to make informed decisions about aca6 demic and career options; 

7 (E) meets State academic standards, State 

8 requirements for secondary school graduation 

9 and is aligned with requirements for entry into 

10 postsecondary education, and applicable indus11 try standards; and 

12 (F) leads to 2 or more credentials, includ13 ing— 

14 (i) a secondary school diploma; and 

15 (ii) a postsecondary degree, an ap16 prenticeship or other occupational certifi17 cation, a certificate, or a license. 

18 (3) INSTITUTION OF HIGHER EDUCATION.—The 

19 term ‘‘institution of higher education’’ has the 

20 meaning given the term in sections 101 and 102 of 

21 the Higher Education Act of 1965 (20 U.S.C. 1001 

22 and 1002). 

23 (4) LOW INCOME INDIVIDUAL, STATE WORK24 FORCE INVESTMENT BOARD, AND LOCAL WORK25 FORCE INVESTMENT BOARD.— 


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1 (A) LOW-INCOME INDIVIDUAL.—The term 

2 ‘‘low-income individual’’ has the meaning given 

3 that term in section 101 of the Workforce in4 vestment Act of 1998 (29 U.S.C. 2801). 

5 (B) STATE WORKFORCE INVESTMENT

6 BOARD; LOCAL WORKFORCE INVESTMENT

7 BOARD.—The terms ‘‘State workforce invest8 ment board’’ and ‘‘local workforce investment 

9 board’’, refer to a State workforce investment 

10 board established under section 111 of the 

11 Workforce Investment Act of 1998 (29 U.S.C. 

12 2821) and a local workforce investment board 

13 established under section 117 of such Act (29 

14 U.S.C. 2832), respectively. 

15 (5) POSTSECONDARY EDUCATION.—The term 

16 ‘‘postsecondary education’’ means— 

17 (A) a 4-year program of instruction, or not 

18 less than a 1-year program of instruction that 

19 is acceptable for credit toward an associate or 

20 a baccalaureate degree, offered by an institution 

21 of higher education; or 

22 (B) a certificate or registered apprentice23 ship program at the postsecondary level offered 

24 by an institution of higher education or a non25 profit educational institution. 


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1 (6) REGISTERED APPRENTICESHIP PROGRAM.— 

2 The term ‘‘registered apprenticeship program’’ 

3 means an industry skills training program at the 

4 postsecondary level that combines technical and the5 oretical training through structure on the job learn6 ing with related instruction (in a classroom or 

7 through distance learning) while an individual is em8 ployed, working under the direction of qualified per9 sonnel or a mentor, and earning incremental wage 

10 increases aligned to enhance job proficiency, result11 ing in the acquisition of a nationally recognized and 

12 portable certificate, under a plan approved by the 

13 Office of Apprenticeship or a State agency recog14 nized by the Department of Labor. 

15 (b) TITLE VII OF THE PUBLIC HEALTH SERVICE

16 ACT.—Section 799B of the Public Health Service Act (42 

17 U.S.C. 295p) is amended— 

18 (1) by striking paragraph (3) and inserting the 

19 following: 

20 ‘‘(3) PHYSICIAN ASSISTANT EDUCATION PRO21 GRAM.—The term ‘physician assistant education 

22 program’ means an educational program in a public 

23 or private institution in a State that— 

24 ‘‘(A) has as its objective the education of 

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1 ies in the program, be qualified to provide pri2 mary care medical services with the supervision 

3 of a physician; and 

4 ‘‘(B) is accredited by the Accreditation Re5 view Commission on Education for the Physi6 cian Assistant.’’; and 

7 (2) by adding at the end the following: 

8 ‘‘(12) AREA HEALTH EDUCATION CENTER.— 

9 The term ‘area health education center’ means a 

10 public or nonprofit private organization that has a 

11 cooperative agreement or contract in effect with an 

12 entity that has received an award under subsection 

13 (a)(1) or (a)(2) of section 751, satisfies the require14 ments in section 751(d)(1), and has as one of its 

15 principal functions the operation of an area health 

16 education center. Appropriate organizations may in17 clude hospitals, health organizations with accredited 

18 primary care training programs, accredited physician 

19 assistant educational programs associated with a col20 lege or university, and universities or colleges not 

21 operating a school of medicine or osteopathic medi22 cine. 

23 ‘‘(13) AREA HEALTH EDUCATION CENTER PRO24 GRAM.—The term ‘area health education center pro25 gram’ means cooperative program consisting of an 


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1 entity that has received an award under subsection 

2 (a)(1) or (a)(2) of section 751 for the purpose of 

3 planning, developing, operating, and evaluating an 

4 area health education center program and one or 

5 more area health education centers, which carries 

6 out the required activities described in section 

7 751(c), satisfies the program requirements in such 

8 section, has as one of its principal functions identi9 fying and implementing strategies and activities that 

10 address health care workforce needs in its service 

11 area, in coordination with the local workforce invest12 ment boards. 

13 ‘‘(14) CLINICAL SOCIAL WORKER.—The term 

14 ‘clinical social worker’ has the meaning given the 

15 term in section 1861(hh)(1) of the Social Security 

16 Act (42 U.S.C. 1395x(hh)(1)). 

17 ‘‘(15) CULTURAL COMPETENCY.—The term 

18 ‘cultural competency’ shall be defined by the Sec19 retary in a manner consistent with section 

20 1707(d)(3). 

21 ‘‘(16) DIRECT CARE WORKER.—The term ‘di22 rect care worker’ has the meaning given that term 

23 in the 2010 Standard Occupational Classifications of 

24 the Department of Labor for Home Health Aides 

25 [31–1011], Psychiatric Aides [31–1013], Nursing 


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1 Assistants [31–1014], and Personal Care Aides [39– 

2 9021]. 

3 ‘‘(17) FEDERALLY QUALIFIED HEALTH CEN4 TER.—The term ‘Federally qualified health center’ 

5 has the meaning given that term in section 1861(aa) 

6 of the Social Security Act (42 U.S.C. 1395x(aa)). 

7 ‘‘(18) FRONTIER HEALTH PROFESSIONAL

8 SHORTAGE AREA.—The term ‘frontier health profes9 sional shortage area’ means an area— 

10 ‘‘(A) with a population density less than 6 

11 persons per square mile within the service area; 

12 and 

13 ‘‘(B) with respect to which the distance or 

14 time for the population to access care is exces15 sive. 

16 ‘‘(19) GRADUATE PSYCHOLOGY.—The term 

17 ‘graduate psychology’ means an accredited program 

18 in professional psychology. 

19 ‘‘(20) HEALTH DISPARITY POPULATION.—The 

20 term ‘health disparity population’ has the meaning 

21 given such term in section 903(d)(1). 

22 ‘‘(21) HEALTH LITERACY.—The term ‘health 

23 literacy’ means the degree to which an individual has 

24 the capacity to obtain, communicate, process, and 


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1 understand health information and services in order 

2 to make appropriate health decisions. 

3 ‘‘(22) MENTAL HEALTH SERVICE PROFES4 SIONAL.—The term ‘mental health service profes5 sional’ means an individual with a graduate or post6 graduate degree from an accredited institution of 

7 higher education in psychiatry, psychology, school 

8 psychology, behavioral pediatrics, psychiatric nurs9 ing, social work, school social work, substance abuse 

10 disorder prevention and treatment, marriage and 

11 family counseling, school counseling, or professional 

12 counseling. 

13 ‘‘(23) ONE-STOP DELIVERY SYSTEM CENTER.— 

14 The term ‘one-stop delivery system’ means a one15 stop delivery system described in section 134(c) of 

16 the Workforce Investment Act of 1998 (29 U.S.C. 

17 2864(c)). 

18 ‘‘(24) PARAPROFESSIONAL CHILD AND ADOLES19 CENT MENTAL HEALTH WORKER.—The term ‘para20 professional child and adolescent mental health 

21 worker’ means an individual who is not a mental or 

22 behavioral health service professional, but who works 

23 at the first stage of contact with children and fami24 lies who are seeking mental or behavioral health 


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1 services, including substance abuse prevention and 

2 treatment services. 

3 ‘‘(25) RACIAL AND ETHNIC MINORITY GROUP; 

4 RACIAL AND ETHNIC MINORITY POPULATION.—The 

5 terms ‘racial and ethnic minority group’ and ‘racial 

6 and ethnic minority population’ have the meaning 

7 given the term ‘racial and ethnic minority group’ in 

8 section 1707. 

9 ‘‘(26) RURAL HEALTH CLINIC.—The term 

10 ‘rural health clinic’ has the meaning given that term 

11 in section 1861(aa) of the Social Security Act (42 

12 U.S.C. 1395x(aa)).’’. 

13 (c) TITLE VIII OF THE PUBLIC HEALTH SERVICE

14 ACT.—Section 801 of the Public Health Service Act (42 

15 U.S.C. 296) is amended— 

16 (1) in paragraph (2)— 

17 (A) by striking ‘‘means a’’ and inserting 

18 ‘‘means an accredited (as defined in paragraph 

19 6)’’; and 

20 (B) by striking the period as inserting the 

21 following: ‘‘where graduates are— 

22 ‘‘(A) authorized to sit for the National 

23 Council Licensure EXamination-Registered 

24 Nurse (NCLEX-RN); or 


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1 ‘‘(B) licensed registered nurses who will re2 ceive a graduate or equivalent degree or train3 ing to become an advanced education nurse as 

4 defined by section 811(b).’’; and 

5 (2) by adding at the end the following: 

6 ‘‘(16) ACCELERATED NURSING DEGREE PRO7 GRAM.—The term ‘accelerated nursing degree pro8 gram’ means a program of education in professional 

9 nursing offered by an accredited school of nursing in 

10 which an individual holding a bachelors degree in 

11 another discipline receives a BSN or MSN degree in 

12 an accelerated time frame as determined by the ac13 credited school of nursing. 

14 ‘‘(17) BRIDGE OR DEGREE COMPLETION PRO15 GRAM.—The term ‘bridge or degree completion pro16 gram’ means a program of education in professional 

17 nursing offered by an accredited school of nursing, 

18 as defined in paragraph (2), that leads to a bacca19 laureate degree in nursing. Such programs may in20 clude, Registered Nurse (RN) to Bachelor’s of 

21 Science of Nursing (BSN) programs, RN to MSN 

22 (Master of Science of Nursing) programs, or BSN to 

23 Doctoral programs.’’. 


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1 Subtitle B—Innovations in the 

2 Health Care Workforce 

3 SEC. 5101. NATIONAL HEALTH CARE WORKFORCE COMMIS4 SION. 

5 (a) PURPOSE.—It is the purpose of this section to 

6 establish a National Health Care Workforce Commission 

7 that— 

8 (1) serves as a national resource for Congress, 

9 the President, States, and localities; 

10 (2) communicates and coordinates with the De11 partments of Health and Human Services, Labor, 

12 Veterans Affairs, Homeland Security, and Education 

13 on related activities administered by one or more of 

14 such Departments; 

15 (3) develops and commissions evaluations of 

16 education and training activities to determine wheth17 er the demand for health care workers is being met; 

18 (4) identifies barriers to improved coordination 

19 at the Federal, State, and local levels and rec20 ommend ways to address such barriers; and 

21 (5) encourages innovations to address popu22 lation needs, constant changes in technology, and 

23 other environmental factors. 


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1 (b) ESTABLISHMENT.—There is hereby established 

2 the National Health Care Workforce Commission (in this 

3 section referred to as the ‘‘Commission’’). 

4 (c) MEMBERSHIP.— 

5 (1) NUMBER AND APPOINTMENT.—The Com6 mission shall be composed of 15 members to be ap7 pointed by the Comptroller General, without regard 

8 to section 5 of the Federal Advisory Committee Act 

9 (5 U.S.C. App.). 

10 (2) QUALIFICATIONS.— 

11 (A) IN GENERAL.—The membership of the 

12 Commission shall include individuals— 

13 (i) with national recognition for their 

14 expertise in health care labor market anal15 ysis, including health care workforce anal16 ysis; health care finance and economics; 

17 health care facility management; health 

18 care plans and integrated delivery systems; 

19 health care workforce education and train20 ing; health care philanthropy; providers of 

21 health care services; and other related 

22 fields; and 

23 (ii) who will provide a combination of 

24 professional perspectives, broad geographic 

25 representation, and a balance between 


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1 urban, suburban, rural, and frontier rep2 resentatives. 

3 (B) INCLUSION.— 

4 (i) IN GENERAL.—The membership of 

5 the Commission shall include no less than 

6 one representative of— 

7 (I) the health care workforce and 

8 health professionals; 

9 (II) employers; 

10 (III) third-party payers; 

11 (IV) individuals skilled in the 

12 conduct and interpretation of health 

13 care services and health economics re14 search; 

15 (V) representatives of consumers; 

16 (VI) labor unions; 

17 (VII) State or local workforce in18 vestment boards; and 

19 (VIII) educational institutions 

20 (which may include elementary and 

21 secondary institutions, institutions of 

22 higher education, including 2 and 4 

23 year institutions, or registered ap24 prenticeship programs). 


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1 (ii) ADDITIONAL MEMBERS.—The re2 maining membership may include addi3 tional representatives from clause (i) and 

4 other individuals as determined appro5 priate by the Comptroller General of the 

6 United States. 

7 (C) MAJORITY NON-PROVIDERS.—Individ8 uals who are directly involved in health profes9 sions education or practice shall not constitute 

10 a majority of the membership of the Commis11 sion. 

12 (D) ETHICAL DISCLOSURE.—The Comp13 troller General shall establish a system for pub14 lic disclosure by members of the Commission of 

15 financial and other potential conflicts of interest 

16 relating to such members. Members of the 

17 Commission shall be treated as employees of 

18 Congress for purposes of applying title I of the 

19 Ethics in Government Act of 1978. Members of 

20 the Commission shall not be treated as special 

21 government employees under title 18, United 

22 States Code. 

23 (3) TERMS.— 

24 (A) IN GENERAL.—The terms of members 

25 of the Commission shall be for 3 years except 


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1 that the Comptroller General shall designate 

2 staggered terms for the members first ap3 pointed. 

4 (B) VACANCIES.—Any member appointed 

5 to fill a vacancy occurring before the expiration 

6 of the term for which the member’s predecessor 

7 was appointed shall be appointed only for the 

8 remainder of that term. A member may serve 

9 after the expiration of that member’s term until 

10 a successor has taken office. A vacancy in the 

11 Commission shall be filled in the manner in 

12 which the original appointment was made. 

13 (C) INITIAL APPOINTMENTS.—The Comp14 troller General shall make initial appointments 

15 of members to the Commission not later than 

16 September 30, 2010. 

17 (4) COMPENSATION.—While serving on the 

18 business of the Commission (including travel time), 

19 a member of the Commission shall be entitled to 

20 compensation at the per diem equivalent of the rate 

21 provided for level IV of the Executive Schedule 

22 under section 5315 of tile 5, United States Code, 

23 and while so serving away from home and the mem24 ber’s regular place of business, a member may be al25 lowed travel expenses, as authorized by the ChairVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01282 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 man of the Commission. Physicians serving as per2 sonnel of the Commission may be provided a physi3 cian comparability allowance by the Commission in 

4 the same manner as Government physicians may be 

5 provided such an allowance by an agency under sec6 tion 5948 of title 5, United States Code, and for 

7 such purpose subsection (i) of such section shall 

8 apply to the Commission in the same manner as it 

9 applies to the Tennessee Valley Authority. For pur10 poses of pay (other than pay of members of the 

11 Commission) and employment benefits, rights, and 

12 privileges, all personnel of the Commission shall be 

13 treated as if they were employees of the United 

14 States Senate. Personnel of the Commission shall 

15 not be treated as employees of the Government Ac16 countability Office for any purpose. 

17 (5) CHAIRMAN, VICE CHAIRMAN.—The Comp18 troller General shall designate a member of the 

19 Commission, at the time of appointment of the mem20 ber, as Chairman and a member as Vice Chairman 

21 for that term of appointment, except that in the case 

22 of vacancy of the chairmanship or vice chairman23 ship, the Comptroller General may designate another 

24 member for the remainder of that member’s term. 


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1 (6) MEETINGS.—The Commission shall meet at 

2 the call of the chairman, but no less frequently than 

3 on a quarterly basis. 

4 (d) DUTIES.— 

5 (1) RECOGNITION, DISSEMINATION, AND COM6 MUNICATION.—The Commission shall— 

7 (A) recognize efforts of Federal, State, and 

8 local partnerships to develop and offer health 

9 care career pathways of proven effectiveness; 

10 (B) disseminate information on promising 

11 retention practices for health care professionals; 

12 and 

13 (C) communicate information on important 

14 policies and practices that affect the recruit15 ment, education and training, and retention of 

16 the health care workforce. 

17 (2) REVIEW OF HEALTH CARE WORKFORCE

18 AND ANNUAL REPORTS.—In order to develop a fis19 cally sustainable integrated workforce that supports 

20 a high-quality, readily accessible health care delivery 

21 system that meets the needs of patients and popu22 lations, the Commission, in consultation with rel23 evant Federal, State, and local agencies, shall— 


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1 (A) review current and projected health 

2 care workforce supply and demand, including 

3 the topics described in paragraph (3); 

4 (B) make recommendations to Congress 

5 and the Administration concerning national 

6 health care workforce priorities, goals, and poli7 cies; 

8 (C) by not later than October 1 of each 

9 year (beginning with 2011), submit a report to 

10 Congress and the Administration containing the 

11 results of such reviews and recommendations 

12 concerning related policies; and 

13 (D) by not later than April 1 of each year 

14 (beginning with 2011), submit a report to Con15 gress and the Administration containing a re16 view of, and recommendations on, at a min17 imum one high priority area as described in 

18 paragraph (4). 

19 (3) SPECIFIC TOPICS TO BE REVIEWED.—The 

20 topics described in this paragraph include— 

21 (A) current health care workforce supply 

22 and distribution, including demographics, skill 

23 sets, and demands, with projected demands 

24 during the subsequent 10 and 25 year periods; 


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1 (B) health care workforce education and 

2 training capacity, including the number of stu3 dents who have completed education and train4 ing, including registered apprenticeships; the 

5 number of qualified faculty; the education and 

6 training infrastructure; and the education and 

7 training demands, with projected demands dur8 ing the subsequent 10 and 25 year periods; 

9 (C) the education loan and grant programs 

10 in titles VII and VIII of the Public Health 

11 Service Act (42 U.S.C. 292 et seq. and 296 et 

12 seq.), with recommendations on whether such 

13 programs should become part of the Higher 

14 Education Act of 1965 (20 U.S.C. 1001 et 

15 seq); 

16 (D) the implications of new and existing 

17 Federal policies which affect the health care 

18 workforce, including Medicare and Medicaid 

19 graduate medical education policies, titles VII 

20 and VIII of the Public Health Service Act (42 

21 U.S.C. 292 et seq. and 296 et seq.), the Na22 tional Health Service Corps (with recommenda23 tions for aligning such programs with national 

24 health workforce priorities and goals), and 

25 other health care workforce programs, including 


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1 those supported through the Workforce Invest2 ment Act of 1998 (29 U.S.C. 2801 et seq.), the 

3 Carl D. Perkins Career and Technical Edu4 cation Act of 2006 (20 U.S.C. 2301 et seq.), 

5 the Higher Education Act of 1965 (20 U.S.C. 

6 1001 et seq.), and any other Federal health 

7 care workforce programs; 

8 (E) the health care workforce needs of spe9 cial populations, such as minorities, rural popu10 lations, medically underserved populations, gen11 der specific needs, individuals with disabilities, 

12 and geriatric and pediatric populations with 

13 recommendations for new and existing Federal 

14 policies to meet the needs of these special popu15 lations; and 

16 (F) recommendations creating or revising 

17 national loan repayment programs and scholar18 ship programs to require low-income, minority 

19 medical students to serve in their home commu20 nities, if designated as medical underserved 

21 community. 

22 (4) HIGH PRIORITY AREAS.— 

23 (A) IN GENERAL.—The initial high priority 

24 topics described in this paragraph include each 

25 of the following: 


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1 (i) Integrated health care workforce 

2 planning that identifies health care profes3 sional skills needed and maximizes the skill 

4 sets of health care professionals across dis5 ciplines. 

6 (ii) An analysis of the nature, scopes 

7 of practice, and demands for health care 

8 workers in the enhanced information tech9 nology and management workplace. 

10 (iii) An analysis of how to align Medi11 care and Medicaid graduate medical edu12 cation policies with national workforce 

13 goals. 

14 (iv) The education and training capac15 ity, projected demands, and integration 

16 with the health care delivery system of 

17 each of the following: 

18 (I) Nursing workforce capacity at 

19 all levels. 

20 (II) Oral health care workforce 

21 capacity at all levels. 

22 (III) Mental and behavioral 

23 health care workforce capacity at all 

24 levels. 


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1 (IV) Allied health and public 

2 health care workforce capacity at all 

3 levels. 

4 (V) Emergency medical service 

5 workforce capacity, including the re6 tention and recruitment of the volun7 teer workforce, at all levels. 

8 (VI) The geographic distribution 

9 of health care providers as compared 

10 to the identified health care workforce 

11 needs of States and regions. 

12 (B) FUTURE DETERMINATIONS.—The 

13 Commission may require that additional topics 

14 be included under subparagraph (A). The ap15 propriate committees of Congress may rec16 ommend to the Commission the inclusion of 

17 other topics for health care workforce develop18 ment areas that require special attention. 

19 (5) GRANT PROGRAM.—The Commission 

20 shall— 

21 (A) review implementation progress reports 

22 on, and report to Congress about, the State 

23 Health Care Workforce Development Grant 

24 program established in section 5102; 


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1 (B) in collaboration with the Department 

2 of Labor and in coordination with the Depart3 ment of Education and other relevant Federal 

4 agencies, make recommendations to the fiscal 

5 and administrative agent under section 5102(b) 

6 for grant recipients under section 5102; 

7 (C) assess the implementation of the 

8 grants under such section; and 

9 (D) collect performance and report infor10 mation, including identified models and best 

11 practices, on grants from the fiscal and admin12 istrative agent under such section and dis13 tribute this information to Congress, relevant 

14 Federal agencies, and to the public. 

15 (6) STUDY.—The Commission shall study effec16 tive mechanisms for financing education and train17 ing for careers in health care, including public health 

18 and allied health. 

19 (7) RECOMMENDATIONS.—The Commission 

20 shall submit recommendations to Congress, the De21 partment of Labor, and the Department of Health 

22 and Human Services about improving safety, health, 

23 and worker protections in the workplace for the 

24 health care workforce. 


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1 (8) ASSESSMENT.—The Commission shall as2 sess and receive reports from the National Center 

3 for Health Care Workforce Analysis established 

4 under section 761(b) of the Public Service Health 

5 Act (as amended by section 5103). 

6 (e) CONSULTATION WITH FEDERAL, STATE, AND

7 LOCAL AGENCIES, CONGRESS, AND OTHER ORGANIZA8 TIONS.— 

9 (1) IN GENERAL.—The Commission shall con10 sult with Federal agencies (including the Depart11 ments of Health and Human Services, Labor, Edu12 cation, Commerce, Agriculture, Defense, and Vet13 erans Affairs and the Environmental Protection 

14 Agency), Congress, the Medicare Payment Advisory 

15 Commission, the Medicaid and CHIP Payment and 

16 Access Commission, and, to the extent practicable, 

17 with State and local agencies, Indian tribes, vol18 untary health care organizations, professional soci19 eties, and other relevant public-private health care 

20 partnerships. 

21 (2) OBTAINING OFFICIAL DATA.—The Commis22 sion, consistent with established privacy rules, may 

23 secure directly from any department or agency of 

24 the Executive Branch information necessary to en25 able the Commission to carry out this section. 


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1 (3) DETAIL OF FEDERAL GOVERNMENT EM2 PLOYEES.—An employee of the Federal Government 

3 may be detailed to the Commission without reim4 bursement. The detail of such an employee shall be 

5 without interruption or loss of civil service status. 

6 (f) DIRECTOR AND STAFF; EXPERTS AND CONSULT7 ANTS.—Subject to such review as the Comptroller General 

8 of the United States determines to be necessary to ensure 

9 the efficient administration of the Commission, the Com10 mission may— 

11 (1) employ and fix the compensation of an exec12 utive director that shall not exceed the rate of basic 

13 pay payable for level V of the Executive Schedule 

14 and such other personnel as may be necessary to 

15 carry out its duties (without regard to the provisions 

16 of title 5, United States Code, governing appoint17 ments in the competitive service); 

18 (2) seek such assistance and support as may be 

19 required in the performance of its duties from ap20 propriate Federal departments and agencies; 

21 (3) enter into contracts or make other arrange22 ments, as may be necessary for the conduct of the 

23 work of the Commission (without regard to section 

24 3709 of the Revised Statutes (41 U.S.C. 5)); 


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1 (4) make advance, progress, and other pay2 ments which relate to the work of the Commission; 

3 (5) provide transportation and subsistence for 

4 persons serving without compensation; and 

5 (6) prescribe such rules and regulations as the 

6 Commission determines to be necessary with respect 

7 to the internal organization and operation of the 

8 Commission. 

9 (g) POWERS.— 

10 (1) DATA COLLECTION.—In order to carry out 

11 its functions under this section, the Commission 

12 shall— 

13 (A) utilize existing information, both pub14 lished and unpublished, where possible, collected 

15 and assessed either by its own staff or under 

16 other arrangements made in accordance with 

17 this section, including coordination with the Bu18 reau of Labor Statistics; 

19 (B) carry out, or award grants or con20 tracts for the carrying out of, original research 

21 and development, where existing information is 

22 inadequate, and 

23 (C) adopt procedures allowing interested 

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1 sion’s use in making reports and recommenda2 tions. 

3 (2) ACCESS OF THE GOVERNMENT ACCOUNT4 ABILITY OFFICE TO INFORMATION.—The Comp5 troller General of the United States shall have unre6 stricted access to all deliberations, records, and data 

7 of the Commission, immediately upon request. 

8 (3) PERIODIC AUDIT.—The Commission shall 

9 be subject to periodic audit by an independent public 

10 accountant under contract to the Commission. 

11 (h) AUTHORIZATION OF APPROPRIATIONS.— 

12 (1) REQUEST FOR APPROPRIATIONS.—The 

13 Commission shall submit requests for appropriations 

14 in the same manner as the Comptroller General of 

15 the United States submits requests for appropria16 tions. Amounts so appropriated for the Commission 

17 shall be separate from amounts appropriated for the 

18 Comptroller General. 

19 (2) AUTHORIZATION.—There are authorized to 

20 be appropriated such sums as may be necessary to 

21 carry out this section. 

22 (3) GIFTS AND SERVICES.—The Commission 

23 may not accept gifts, bequeaths, or donations of 

24 property, but may accept and use donations of serv25 ices for purposes of carrying out this section. 


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1 (i) DEFINITIONS.—In this section: 

2 (1) HEALTH CARE WORKFORCE.—The term 

3 ‘‘health care workforce’’ includes all health care pro4 viders with direct patient care and support respon5 sibilities, such as physicians, nurses, nurse practi6 tioners, primary care providers, preventive medicine 

7 physicians, optometrists, ophthalmologists, physician 

8 assistants, pharmacists, dentists, dental hygienists, 

9 and other oral healthcare professionals, allied health 

10 professionals, doctors of chiropractic, community 

11 health workers, health care paraprofessionals, direct 

12 care workers, psychologists and other behavioral and 

13 mental health professionals (including substance 

14 abuse prevention and treatment providers), social 

15 workers, physical and occupational therapists, cer16 tified nurse midwives, podiatrists, the EMS work17 force (including professional and volunteer ambu18 lance personnel and firefighters who perform emer19 gency medical services), licensed complementary and 

20 alternative medicine providers, integrative health 

21 practitioners, public health professionals, and any 

22 other health professional that the Comptroller Gen23 eral of the United States determines appropriate. 

24 (2) HEALTH PROFESSIONALS.—The term 

25 ‘‘health professionals’’ includes— 


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1 (A) dentists, dental hygienists, primary 

2 care providers, specialty physicians, nurses, 

3 nurse practitioners, physician assistants, psy4 chologists and other behavioral and mental 

5 health professionals (including substance abuse 

6 prevention and treatment providers), social 

7 workers, physical and occupational therapists, 

8 public health professionals, clinical pharmacists, 

9 allied health professionals, doctors of chiro10 practic, community health workers, school 

11 nurses, certified nurse midwives, podiatrists, li12 censed complementary and alternative medicine 

13 providers, the EMS workforce (including profes14 sional and volunteer ambulance personnel and 

15 firefighters who perform emergency medical 

16 services), and integrative health practitioners; 

17 (B) national representatives of health pro18 fessionals; 

19 (C) representatives of schools of medicine, 

20 osteopathy, nursing, dentistry, optometry, phar21 macy, chiropractic, allied health, educational 

22 programs for public health professionals, behav23 ioral and mental health professionals (as so de24 fined), social workers, pharmacists, physical 

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1 dustry dentistry and dental hygiene, and physi2 cian assistants; 

3 (D) representatives of public and private 

4 teaching hospitals, and ambulatory health facili5 ties, including Federal medical facilities; and 

6 (E) any other health professional the 

7 Comptroller General of the United States deter8 mines appropriate. 

9 SEC. 5102. STATE HEALTH CARE WORKFORCE DEVELOP10 MENT GRANTS. 

11 (a) ESTABLISHMENT.—There is established a com12 petitive health care workforce development grant program 

13 (referred to in this section as the ‘‘program’’) for the pur14 pose of enabling State partnerships to complete com15 prehensive planning and to carry out activities leading to 

16 coherent and comprehensive health care workforce devel17 opment strategies at the State and local levels. 

18 (b) FISCAL AND ADMINISTRATIVE AGENT.—The 

19 Health Resources and Services Administration of the De20 partment of Health and Human Services (referred to in 

21 this section as the ‘‘Administration’’) shall be the fiscal 

22 and administrative agent for the grants awarded under 

23 this section. The Administration is authorized to carry out 

24 the program, in consultation with the National Health 

25 Care Workforce Commission (referred to in this section 


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1 as the ‘‘Commission’’), which shall review reports on the 

2 development, implementation, and evaluation activities of 

3 the grant program, including— 

4 (1) administering the grants; 

5 (2) providing technical assistance to grantees; 

6 and 

7 (3) reporting performance information to the 

8 Commission. 

9 (c) PLANNING GRANTS.— 

10 (1) AMOUNT AND DURATION.—A planning 

11 grant shall be awarded under this subsection for a 

12 period of not more than one year and the maximum 

13 award may not be more than $150,000. 

14 (2) ELIGIBILITY.—To be eligible to receive a 

15 planning grant, an entity shall be an eligible part16 nership. An eligible partnership shall be a State 

17 workforce investment board, if it includes or modi18 fies the members to include at least one representa19 tive from each of the following: health care em20 ployer, labor organization, a public 2-year institution 

21 of higher education, a public 4-year institution of 

22 higher education, the recognized State federation of 

23 labor, the State public secondary education agency, 

24 the State P–16 or P–20 Council if such a council ex25 ists, and a philanthropic organization that is actively 


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1 engaged in providing learning, mentoring, and work 

2 opportunities to recruit, educate, and train individ3 uals for, and retain individuals in, careers in health 

4 care and related industries. 

5 (3) FISCAL AND ADMINISTRATIVE AGENT.—The 

6 Governor of the State receiving a planning grant has 

7 the authority to appoint a fiscal and an administra8 tive agency for the partnership. 

9 (4) APPLICATION.—Each State partnership de10 siring a planning grant shall submit an application 

11 to the Administrator of the Administration at such 

12 time and in such manner, and accompanied by such 

13 information as the Administrator may reasonable re14 quire. Each application submitted for a planning 

15 grant shall describe the members of the State part16 nership, the activities for which assistance is sought, 

17 the proposed performance benchmarks to be used to 

18 measure progress under the planning grant, a budg19 et for use of the funds to complete the required ac20 tivities described in paragraph (5), and such addi21 tional assurance and information as the Adminis22 trator determines to be essential to ensure compli23 ance with the grant program requirements. 


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1 (5) REQUIRED ACTIVITIES.—A State partner2 ship receiving a planning grant shall carry out the 

3 following: 

4 (A) Analyze State labor market informa5 tion in order to create health care career path6 ways for students and adults, including dis7 located workers. 

8 (B) Identify current and projected high de9 mand State or regional health care sectors for 

10 purposes of planning career pathways. 

11 (C) Identify existing Federal, State, and 

12 private resources to recruit, educate or train, 

13 and retain a skilled health care workforce and 

14 strengthen partnerships. 

15 (D) Describe the academic and health care 

16 industry skill standards for high school gradua17 tion, for entry into postsecondary education, 

18 and for various credentials and licensure. 

19 (E) Describe State secondary and postsec20 ondary education and training policies, models, 

21 or practices for the health care sector, including 

22 career information and guidance counseling. 

23 (F) Identify Federal or State policies or 

24 rules to developing a coherent and comprehen25 sive health care workforce development strategy 


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1 and barriers and a plan to resolve these bar2 riers. 

3 (G) Participate in the Administration’s 

4 evaluation and reporting activities. 

5 (6) PERFORMANCE AND EVALUATION.—Before 

6 the State partnership receives a planning grant, 

7 such partnership and the Administrator of the Ad8 ministration shall jointly determine the performance 

9 benchmarks that will be established for the purposes 

10 of the planning grant. 

11 (7) MATCH.—Each State partnership receiving 

12 a planning grant shall provide an amount, in cash 

13 or in kind, that is not less that 15 percent of the 

14 amount of the grant, to carry out the activities sup15 ported by the grant. The matching requirement may 

16 be provided from funds available under other Fed17 eral, State, local or private sources to carry out the 

18 activities. 

19 (8) REPORT.— 

20 (A) REPORT TO ADMINISTRATION.—Not 

21 later than 1 year after a State partnership re22 ceives a planning grant, the partnership shall 

23 submit a report to the Administration on the 

24 State’s performance of the activities under the 

25 grant, including the use of funds, including 


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1 matching funds, to carry out required activities, 

2 and a description of the progress of the State 

3 workforce investment board in meeting the per4 formance benchmarks. 

5 (B) REPORT TO CONGRESS.—The Admin6 istration shall submit a report to Congress ana7 lyzing the planning activities, performance, and 

8 fund utilization of each State grant recipient, 

9 including an identification of promising prac10 tices and a profile of the activities of each State 

11 grant recipient. 

12 (d) IMPLEMENTATION GRANTS.— 

13 (1) IN GENERAL.—The Administration shall— 

14 (A) competitively award implementation 

15 grants to State partnerships to enable such 

16 partnerships to implement activities that will 

17 result in a coherent and comprehensive plan for 

18 health workforce development that will address 

19 current and projected workforce demands with20 in the State; and 

21 (B) inform the Commission and Congress 

22 about the awards made. 

23 (2) DURATION.—An implementation grant shall 

24 be awarded for a period of no more than 2 years, 

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1 termines that the grantee is high performing and the 

2 activities supported by the grant warrant up to 1 ad3 ditional year of funding. 

4 (3) ELIGIBILITY.—To be eligible for an imple5 mentation grant, a State partnership shall have— 

6 (A) received a planning grant under sub7 section (c) and completed all requirements of 

8 such grant; or 

9 (B) completed a satisfactory application, 

10 including a plan to coordinate with required 

11 partners and complete the required activities 

12 during the 2 year period of the implementation 

13 grant. 

14 (4) FISCAL AND ADMINISTRATIVE AGENT.—A 

15 State partnership receiving an implementation grant 

16 shall appoint a fiscal and an administration agent 

17 for the implementation of such grant. 

18 (5) APPLICATION.—Each eligible State partner19 ship desiring an implementation grant shall submit 

20 an application to the Administration at such time, in 

21 such manner, and accompanied by such information 

22 as the Administration may reasonably require. Each 

23 application submitted shall include— 

24 (A) a description of the members of the 

25 State partnership; 


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1 (B) a description of how the State partner2 ship completed the required activities under the 

3 planning grant, if applicable; 

4 (C) a description of the activities for which 

5 implementation grant funds are sought, includ6 ing grants to regions by the State partnership 

7 to advance coherent and comprehensive regional 

8 health care workforce planning activities; 

9 (D) a description of how the State partner10 ship will coordinate with required partners and 

11 complete the required partnership activities 

12 during the duration of an implementation 

13 grant; 

14 (E) a budget proposal of the cost of the 

15 activities supported by the implementation 

16 grant and a timeline for the provision of match17 ing funds required; 

18 (F) proposed performance benchmarks to 

19 be used to assess and evaluate the progress of 

20 the partnership activities; 

21 (G) a description of how the State partner22 ship will collect data to report progress in grant 

23 activities; and 


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1 (H) such additional assurances as the Ad2 ministration determines to be essential to en3 sure compliance with grant requirements. 

4 (6) REQUIRED ACTIVITIES.— 

5 (A) IN GENERAL.—A State partnership 

6 that receives an implementation grant may re7 serve not less than 60 percent of the grant 

8 funds to make grants to be competitively 

9 awarded by the State partnership, consistent 

10 with State procurement rules, to encourage re11 gional partnerships to address health care 

12 workforce development needs and to promote 

13 innovative health care workforce career pathway 

14 activities, including career counseling, learning, 

15 and employment. 

16 (B) ELIGIBLE PARTNERSHIP DUTIES.—An 

17 eligible State partnership receiving an imple18 mentation grant shall— 

19 (i) identify and convene regional lead20 ership to discuss opportunities to engage in 

21 statewide health care workforce develop22 ment planning, including the potential use 

23 of competitive grants to improve the devel24 opment, distribution, and diversity of the 

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1 ment of curricula for health care careers; 

2 and the access to quality career informa3 tion and guidance and education and train4 ing opportunities; 

5 (ii) in consultation with key stake6 holders and regional leaders, take appro7 priate steps to reduce Federal, State, or 

8 local barriers to a comprehensive and co9 herent strategy, including changes in State 

10 or local policies to foster coherent and 

11 comprehensive health care workforce devel12 opment activities, including health care ca13 reer pathways at the regional and State 

14 levels, career planning information, re15 training for dislocated workers, and as ap16 propriate, requests for Federal program or 

17 administrative waivers; 

18 (iii) develop, disseminate, and review 

19 with key stakeholders a preliminary state20 wide strategy that addresses short- and 

21 long-term health care workforce develop22 ment supply versus demand; 

23 (iv) convene State partnership mem24 bers on a regular basis, and at least on a 

25 semiannual basis; 


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1 (v) assist leaders at the regional level 

2 to form partnerships, including technical 

3 assistance and capacity building activities; 

4 (vi) collect and assess data on and re5 port on the performance benchmarks se6 lected by the State partnership and the 

7 Administration for implementation activi8 ties carried out by regional and State part9 nerships; and 

10 (vii) participate in the Administra11 tion’s evaluation and reporting activities. 

12 (7) PERFORMANCE AND EVALUATION.—Before 

13 the State partnership receives an implementation 

14 grant, it and the Administrator shall jointly deter15 mine the performance benchmarks that shall be es16 tablished for the purposes of the implementation 

17 grant. 

18 (8) MATCH.—Each State partnership receiving 

19 an implementation grant shall provide an amount, in 

20 cash or in kind that is not less than 25 percent of 

21 the amount of the grant, to carry out the activities 

22 supported by the grant. The matching funds may be 

23 provided from funds available from other Federal, 

24 State, local, or private sources to carry out such ac25 tivities. 


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1 (9) REPORTS.— 

2 (A) REPORT TO ADMINISTRATION.—For 

3 each year of the implementation grant, the 

4 State partnership receiving the implementation 

5 grant shall submit a report to the Administra6 tion on the performance of the State of the 

7 grant activities, including a description of the 

8 use of the funds, including matched funds, to 

9 complete activities, and a description of the per10 formance of the State partnership in meeting 

11 the performance benchmarks. 

12 (B) REPORT TO CONGRESS.—The Admin13 istration shall submit a report to Congress ana14 lyzing implementation activities, performance, 

15 and fund utilization of the State grantees, in16 cluding an identification of promising practices 

17 and a profile of the activities of each State 

18 grantee. 

19 (e) AUTHORIZATION FOR APPROPRIATIONS.— 

20 (1) PLANNING GRANTS.—There are authorized 

21 to be appropriated to award planning grants under 

22 subsection (c) $8,000,000 for fiscal year 2010, and 

23 such sums as may be necessary for each subsequent 

24 fiscal year. 


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1 (2) IMPLEMENTATION GRANTS.—There are au2 thorized to be appropriated to award implementation 

3 grants under subsection (d), $150,000,000 for fiscal 

4 year 2010, and such sums as may be necessary for 

5 each subsequent fiscal year. 

6 SEC. 5103. HEALTH CARE WORKFORCE ASSESSMENT. 

7 (a) IN GENERAL.—Section 761 of the Public Health 

8 Service Act (42 U.S.C. 294m) is amended— 

9 (1) by redesignating subsection (c) as sub10 section (e); 

11 (2) by striking subsection (b) and inserting the 

12 following: 

13 ‘‘(b) NATIONAL CENTER FOR HEALTH CARE WORK14 FORCE ANALYSIS.— 

15 ‘‘(1) ESTABLISHMENT.—The Secretary shall es16 tablish the National Center for Health Workforce 

17 Analysis (referred to in this section as the ‘National 

18 Center’). 

19 ‘‘(2) PURPOSES.—The National Center, in co20 ordination to the extent practicable with the Na21 tional Health Care Workforce Commission (estab22 lished in section 5101 of the Patient Protection and 

23 Affordable Care Act), and relevant regional and 

24 State centers and agencies, shall— 


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1 ‘‘(A) provide for the development of infor2 mation describing and analyzing the health care 

3 workforce and workforce related issues; 

4 ‘‘(B) carry out the activities under section 

5 792(a); 

6 ‘‘(C) annually evaluate programs under 

7 this title; 

8 ‘‘(D) develop and publish performance 

9 measures and benchmarks for programs under 

10 this title; and 

11 ‘‘(E) establish, maintain, and publicize a 

12 national Internet registry of each grant award13 ed under this title and a database to collect 

14 data from longitudinal evaluations (as described 

15 in subsection (d)(2)) on performance measures 

16 (as developed under sections 749(d)(3), 

17 757(d)(3), and 762(a)(3)). 

18 ‘‘(3) COLLABORATION AND DATA SHARING.— 

19 ‘‘(A) IN GENERAL.—The National Center 

20 shall collaborate with Federal agencies and rel21 evant professional and educational organiza22 tions or societies for the purpose of linking data 

23 regarding grants awarded under this title. 

24 ‘‘(B) CONTRACTS FOR HEALTH WORK25 FORCE ANALYSIS.—For the purpose of carrying 


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1 out the activities described in subparagraph 

2 (A), the National Center may enter into con3 tracts with relevant professional and edu4 cational organizations or societies. 

5 ‘‘(c) STATE AND REGIONAL CENTERS FOR HEALTH

6 WORKFORCE ANALYSIS.— 

7 ‘‘(1) IN GENERAL.—The Secretary shall award 

8 grants to, or enter into contracts with, eligible enti9 ties for purposes of— 

10 ‘‘(A) collecting, analyzing, and reporting 

11 data regarding programs under this title to the 

12 National Center and to the public; and 

13 ‘‘(B) providing technical assistance to local 

14 and regional entities on the collection, analysis, 

15 and reporting of data. 

16 ‘‘(2) ELIGIBLE ENTITIES.—To be eligible for a 

17 grant or contract under this subsection, an entity 

18 shall— 

19 ‘‘(A) be a State, a State workforce invest20 ment board, a public health or health profes21 sions school, an academic health center, or an 

22 appropriate public or private nonprofit entity; 

23 and 

24 ‘‘(B) submit to the Secretary an applica25 tion at such time, in such manner, and conVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01311 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 taining such information as the Secretary may 

2 require. 

3 ‘‘(d) INCREASE IN GRANTS FOR LONGITUDINAL

4 EVALUATIONS.— 

5 ‘‘(1) IN GENERAL.—The Secretary shall in6 crease the amount awarded to an eligible entity 

7 under this title for a longitudinal evaluation of indi8 viduals who have received education, training, or fi9 nancial assistance from programs under this title. 

10 ‘‘(2) CAPABILITY.—A longitudinal evaluation 

11 shall be capable of— 

12 ‘‘(A) studying practice patterns; and 

13 ‘‘(B) collecting and reporting data on per14 formance measures developed under sections 

15 749(d)(3), 757(d)(3), and 762(a)(3). 

16 ‘‘(3) GUIDELINES.—A longitudinal evaluation 

17 shall comply with guidelines issued under sections 

18 749(d)(4), 757(d)(4), and 762(a)(4). 

19 ‘‘(4) ELIGIBLE ENTITIES.—To be eligible to ob20 tain an increase under this section, an entity shall 

21 be a recipient of a grant or contract under this 

22 title.’’; and 

23 (3) in subsection (e), as so redesignated— 

24 (A) by striking paragraph (1) and insert25 ing the following: 


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1 ‘‘(1) IN GENERAL.— 

2 ‘‘(A) NATIONAL CENTER.—To carry out 

3 subsection (b), there are authorized to be ap4 propriated $7,500,000 for each of fiscal years 

5 2010 through 2014. 

6 ‘‘(B) STATE AND REGIONAL CENTERS.— 

7 To carry out subsection (c), there are author8 ized to be appropriated $4,500,000 for each of 

9 fiscal years 2010 through 2014. 

10 ‘‘(C) GRANTS FOR LONGITUDINAL EVALUA11 TIONS.—To carry out subsection (d), there are 

12 authorized to be appropriated such sums as 

13 may be necessary for fiscal years 2010 through 

14 2014.’’; and 

15 (4) in paragraph (2), by striking ‘‘subsection 

16 (a)’’ and inserting ‘‘paragraph (1)’’. 

17 (b) TRANSFERS.—Not later than 180 days after the 

18 date of enactment of this Act, the responsibilities and re19 sources of the National Center for Health Workforce Anal20 ysis, as in effect on the date before the date of enactment 

21 of this Act, shall be transferred to the National Center 

22 for Health Care Workforce Analysis established under sec23 tion 761 of the Public Health Service Act, as amended 

24 by subsection (a). 


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1 (c) USE OF LONGITUDINAL EVALUATIONS.—Section 

2 791(a)(1) of the Public Health Service Act (42 U.S.C. 

3 295j(a)(1)) is amended— 

4 (1) in subparagraph (A), by striking ‘‘or’’ at 

5 the end; 

6 (2) in subparagraph (B), by striking the period 

7 and inserting ‘‘; or’’; and 

8 (3) by adding at the end the following: 

9 ‘‘(C) utilizes a longitudinal evaluation (as 

10 described in section 761(d)(2)) and reports data 

11 from such system to the national workforce 

12 database (as established under section 

13 761(b)(2)(E)).’’. 

14 (d) PERFORMANCE MEASURES; GUIDELINES FOR

15 LONGITUDINAL EVALUATIONS.— 

16 (1) ADVISORY COMMITTEE ON TRAINING IN PRI17 MARY CARE MEDICINE AND DENTISTRY.—Section 

18 748(d) of the Public Health Service Act is amend19 ed— 

20 (A) in paragraph (1), by striking ‘‘and’’ at 

21 the end; 

22 (B) in paragraph (2), by striking the pe23 riod and inserting a semicolon; and 

24 (C) by adding at the end the following: 


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1 ‘‘(3) develop, publish, and implement perform2 ance measures for programs under this part; 

3 ‘‘(4) develop and publish guidelines for longitu4 dinal evaluations (as described in section 761(d)(2)) 

5 for programs under this part; and 

6 ‘‘(5) recommend appropriation levels for pro7 grams under this part.’’. 

8 (2) ADVISORY COMMITTEE ON INTERDISCIPLI9 NARY, COMMUNITY-BASED LINKAGES.—Section 

10 756(d) of the Public Health Service Act is amend11 ed— 

12 (A) in paragraph (1), by striking ‘‘and’’ at 

13 the end; 

14 (B) in paragraph (2), by striking the pe15 riod and inserting a semicolon; and 

16 (C) by adding at the end the following: 

17 ‘‘(3) develop, publish, and implement perform18 ance measures for programs under this part; 

19 ‘‘(4) develop and publish guidelines for longitu20 dinal evaluations (as described in section 761(d)(2)) 

21 for programs under this part; and 

22 ‘‘(5) recommend appropriation levels for pro23 grams under this part.’’. 


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1 (3) ADVISORY COUNCIL ON GRADUATE MEDICAL

2 EDUCATION.—Section 762(a) of the Public Health 

3 Service Act (42 U.S.C. 294o(a)) is amended— 

4 (A) in paragraph (1), by striking ‘‘and’’ at 

5 the end; 

6 (B) in paragraph (2), by striking the pe7 riod and inserting a semicolon; and 

8 (C) by adding at the end the following: 

9 ‘‘(3) develop, publish, and implement perform10 ance measures for programs under this title, except 

11 for programs under part C or D; 

12 ‘‘(4) develop and publish guidelines for longitu13 dinal evaluations (as described in section 761(d)(2)) 

14 for programs under this title, except for programs 

15 under part C or D; and 

16 ‘‘(5) recommend appropriation levels for pro17 grams under this title, except for programs under 

18 part C or D.’’. 

19 Subtitle C—Increasing the Supply 

20 of the Health Care Workforce 

21 SEC. 5201. FEDERALLY SUPPORTED STUDENT LOAN FUNDS. 

22 (a) MEDICAL SCHOOLS AND PRIMARY HEALTH

23 CARE.—Section 723 of the Public Health Service Act (42 

24 U.S.C. 292s) is amended— 

25 (1) in subsection (a)— 


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1 (A) in paragraph (1), by striking subpara2 graph (B) and inserting the following: 

3 ‘‘(B) to practice in such care for 10 years 

4 (including residency training in primary health 

5 care) or through the date on which the loan is 

6 repaid in full, whichever occurs first.’’; and 

7 (B) by striking paragraph (3) and insert8 ing the following: 

9 ‘‘(3) NONCOMPLIANCE BY STUDENT.—Each 

10 agreement entered into with a student pursuant to 

11 paragraph (1) shall provide that, if the student fails 

12 to comply with such agreement, the loan involved 

13 will begin to accrue interest at a rate of 2 percent 

14 per year greater than the rate at which the student 

15 would pay if compliant in such year.’’; and 

16 (2) by adding at the end the following: 

17 ‘‘(d) SENSE OF CONGRESS.—It is the sense of Con18 gress that funds repaid under the loan program under this 

19 section should not be transferred to the Treasury of the 

20 United States or otherwise used for any other purpose 

21 other than to carry out this section.’’. 

22 (b) STUDENT LOAN GUIDELINES.—The Secretary of 

23 Health and Human Services shall not require parental fi24 nancial information for an independent student to deter25 mine financial need under section 723 of the Public 


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1 Health Service Act (42 U.S.C. 292s) and the determina2 tion of need for such information shall be at the discretion 

3 of applicable school loan officer. The Secretary shall 

4 amend guidelines issued by the Health Resources and 

5 Services Administration in accordance with the preceding 

6 sentence. 

7 SEC. 5202. NURSING STUDENT LOAN PROGRAM. 

8 (a) LOAN AGREEMENTS.—Section 836(a) of the Pub9 lic Health Service Act (42 U.S.C. 297b(a)) is amended— 

10 (1) by striking ‘‘$2,500’’ and inserting 

11 ‘‘$3,300’’; 

12 (2) by striking ‘‘$4,000’’ and inserting 

13 ‘‘$5,200’’; and 

14 (3) by striking ‘‘$13,000’’ and all that follows 

15 through the period and inserting ‘‘$17,000 in the 

16 case of any student during fiscal years 2010 and 

17 2011. After fiscal year 2011, such amounts shall be 

18 adjusted to provide for a cost-of-attendance increase 

19 for the yearly loan rate and the aggregate of the 

20 loans.’’. 

21 (b) LOAN PROVISIONS.—Section 836(b) of the Public 

22 Health Service Act (42 U.S.C. 297b(b)) is amended— 

23 (1) in paragraph (1)(C), by striking ‘‘1986’’ 

24 and inserting ‘‘2000’’; and 


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1 (2) in paragraph (3), by striking ‘‘the date of 

2 enactment of the Nurse Training Amendments of 

3 1979’’ and inserting ‘‘September 29, 1995’’. 

4 SEC. 5203. HEALTH CARE WORKFORCE LOAN REPAYMENT 

5 PROGRAMS. 

6 Part E of title VII of the Public Health Service Act 

7 (42 U.S.C. 294n et seq.) is amended by adding at the end 

8 the following: 

9 ‘‘Subpart 3—Recruitment and Retention Programs 

10 ‘‘SEC. 775. INVESTMENT IN TOMORROW’S PEDIATRIC 

11 HEALTH CARE WORKFORCE. 

12 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab13 lish and carry out a pediatric specialty loan repayment 

14 program under which the eligible individual agrees to be 

15 employed full-time for a specified period (which shall not 

16 be less than 2 years) in providing pediatric medical sub17 specialty, pediatric surgical specialty, or child and adoles18 cent mental and behavioral health care, including sub19 stance abuse prevention and treatment services. 

20 ‘‘(b) PROGRAM ADMINISTRATION.—Through the pro21 gram established under this section, the Secretary shall 

22 enter into contracts with qualified health professionals 

23 under which— 

24 ‘‘(1) such qualified health professionals will 

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1 atric surgical specialty, or child and adolescent men2 tal and behavioral health care in an area with a 

3 shortage of the specified pediatric subspecialty that 

4 has a sufficient pediatric population to support such 

5 pediatric subspecialty, as determined by the Sec6 retary; and 

7 ‘‘(2) the Secretary agrees to make payments on 

8 the principal and interest of undergraduate, grad9 uate, or graduate medical education loans of profes10 sionals described in paragraph (1) of not more than 

11 $35,000 a year for each year of agreed upon service 

12 under such paragraph for a period of not more than 

13 3 years during the qualified health professional’s— 

14 ‘‘(A) participation in an accredited pedi15 atric medical subspecialty, pediatric surgical 

16 specialty, or child and adolescent mental health 

17 subspecialty residency or fellowship; or 

18 ‘‘(B) employment as a pediatric medical 

19 subspecialist, pediatric surgical specialist, or 

20 child and adolescent mental health professional 

21 serving an area or population described in such 

22 paragraph. 

23 ‘‘(c) IN GENERAL.— 

24 ‘‘(1) ELIGIBLE INDIVIDUALS.— 


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1 ‘‘(A) PEDIATRIC MEDICAL SPECIALISTS

2 AND PEDIATRIC SURGICAL SPECIALISTS.—For 

3 purposes of contracts with respect to pediatric 

4 medical specialists and pediatric surgical spe5 cialists, the term ‘qualified health professional’ 

6 means a licensed physician who— 

7 ‘‘(i) is entering or receiving training 

8 in an accredited pediatric medical sub9 specialty or pediatric surgical specialty 

10 residency or fellowship; or 

11 ‘‘(ii) has completed (but not prior to 

12 the end of the calendar year in which this 

13 section is enacted) the training described 

14 in subparagraph (B). 

15 ‘‘(B) CHILD AND ADOLESCENT MENTAL

16 AND BEHAVIORAL HEALTH.—For purposes of 

17 contracts with respect to child and adolescent 

18 mental and behavioral health care, the term 

19 ‘qualified health professional’ means a health 

20 care professional who— 

21 ‘‘(i) has received specialized training 

22 or clinical experience in child and adoles23 cent mental health in psychiatry, psy24 chology, school psychology, behavioral pedi25 atrics, psychiatric nursing, social work, 


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1 school social work, substance abuse dis2 order prevention and treatment, marriage 

3 and family therapy, school counseling, or 

4 professional counseling; 

5 ‘‘(ii) has a license or certification in a 

6 State to practice allopathic medicine, os7 teopathic medicine, psychology, school psy8 chology, psychiatric nursing, social work, 

9 school social work, marriage and family 

10 therapy, school counseling, or professional 

11 counseling; or 

12 ‘‘(iii) is a mental health service pro13 fessional who completed (but not before 

14 the end of the calendar year in which this 

15 section is enacted) specialized training or 

16 clinical experience in child and adolescent 

17 mental health described in clause (i). 

18 ‘‘(2) ADDITIONAL ELIGIBILITY REQUIRE19 MENTS.—The Secretary may not enter into a con20 tract under this subsection with an eligible indi21 vidual unless— 

22 ‘‘(A) the individual agrees to work in, or 

23 for a provider serving, a health professional 

24 shortage area or medically underserved area, or 

25 to serve a medically underserved population; 


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1 ‘‘(B) the individual is a United States cit2 izen or a permanent legal United States resi3 dent; and 

4 ‘‘(C) if the individual is enrolled in a grad5 uate program, the program is accredited, and 

6 the individual has an acceptable level of aca7 demic standing (as determined by the Sec8 retary). 

9 ‘‘(d) PRIORITY.—In entering into contracts under 

10 this subsection, the Secretary shall give priority to appli11 cants who— 

12 ‘‘(1) are or will be working in a school or other 

13 pre-kindergarten, elementary, or secondary edu14 cation setting; 

15 ‘‘(2) have familiarity with evidence-based meth16 ods and cultural and linguistic competence health 

17 care services; and 

18 ‘‘(3) demonstrate financial need. 

19 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

20 is authorized to be appropriated $30,000,000 for each of 

21 fiscal years 2010 through 2014 to carry out subsection 

22 (c)(1)(A) and $20,000,000 for each of fiscal years 2010 

23 through 2013 to carry out subsection (c)(1)(B).’’. 


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1 SEC. 5204. PUBLIC HEALTH WORKFORCE RECRUITMENT 

2 AND RETENTION PROGRAMS. 

3 Part E of title VII of the Public Health Service Act 

4 (42 U.S.C. 294n et seq.), as amended by section 5203, 

5 is further amended by adding at the end the following: 

6 ‘‘SEC. 776. PUBLIC HEALTH WORKFORCE LOAN REPAYMENT 

7 PROGRAM. 

8 ‘‘(a) ESTABLISHMENT.—The Secretary shall estab9 lish the Public Health Workforce Loan Repayment Pro10 gram (referred to in this section as the ‘Program’) to as11 sure an adequate supply of public health professionals to 

12 eliminate critical public health workforce shortages in 

13 Federal, State, local, and tribal public health agencies. 

14 ‘‘(b) ELIGIBILITY.—To be eligible to participate in 

15 the Program, an individual shall— 

16 ‘‘(1)(A) be accepted for enrollment, or be en17 rolled, as a student in an accredited academic edu18 cational institution in a State or territory in the 

19 final year of a course of study or program leading 

20 to a public health or health professions degree or 

21 certificate; and have accepted employment with a 

22 Federal, State, local, or tribal public health agency, 

23 or a related training fellowship, as recognized by the 

24 Secretary, to commence upon graduation; 

25 ‘‘(B)(i) have graduated, during the preceding 

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1 tution in a State or territory and received a public 

2 health or health professions degree or certificate; 

3 and 

4 ‘‘(ii) be employed by, or have accepted employ5 ment with, a Federal, State, local, or tribal public 

6 health agency or a related training fellowship, as 

7 recognized by the Secretary; 

8 ‘‘(2) be a United States citizen; and 

9 ‘‘(3)(A) submit an application to the Secretary 

10 to participate in the Program; 

11 ‘‘(B) execute a written contract as required in 

12 subsection (c); and 

13 ‘‘(4) not have received, for the same service, a 

14 reduction of loan obligations under section 455(m), 

15 428J, 428K, 428L, or 460 of the Higher Education 

16 Act of 1965. 

17 ‘‘(c) CONTRACT.—The written contract (referred to 

18 in this section as the ‘written contract’) between the Sec19 retary and an individual shall contain— 

20 ‘‘(1) an agreement on the part of the Secretary 

21 that the Secretary will repay on behalf of the indi22 vidual loans incurred by the individual in the pursuit 

23 of the relevant degree or certificate in accordance 

24 with the terms of the contract; 


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1 ‘‘(2) an agreement on the part of the individual 

2 that the individual will serve in the full-time employ3 ment of a Federal, State, local, or tribal public 

4 health agency or a related fellowship program in a 

5 position related to the course of study or program 

6 for which the contract was awarded for a period of 

7 time (referred to in this section as the ‘period of ob8 ligated service’) equal to the greater of— 

9 ‘‘(A) 3 years; or 

10 ‘‘(B) such longer period of time as deter11 mined appropriate by the Secretary and the in12 dividual; 

13 ‘‘(3) an agreement, as appropriate, on the part 

14 of the individual to relocate to a priority service area 

15 (as determined by the Secretary) in exchange for an 

16 additional loan repayment incentive amount to be 

17 determined by the Secretary; 

18 ‘‘(4) a provision that any financial obligation of 

19 the United States arising out of a contract entered 

20 into under this section and any obligation of the in21 dividual that is conditioned thereon, is contingent on 

22 funds being appropriated for loan repayments under 

23 this section; 


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1 ‘‘(5) a statement of the damages to which the 

2 United States is entitled, under this section for the 

3 individual’s breach of the contract; and 

4 ‘‘(6) such other statements of the rights and li5 abilities of the Secretary and of the individual, not 

6 inconsistent with this section. 

7 ‘‘(d) PAYMENTS.— 

8 ‘‘(1) IN GENERAL.—A loan repayment provided 

9 for an individual under a written contract under the 

10 Program shall consist of payment, in accordance 

11 with paragraph (2), on behalf of the individual of 

12 the principal, interest, and related expenses on gov13 ernment and commercial loans received by the indi14 vidual regarding the undergraduate or graduate edu15 cation of the individual (or both), which loans were 

16 made for tuition expenses incurred by the individual. 

17 ‘‘(2) PAYMENTS FOR YEARS SERVED.—For 

18 each year of obligated service that an individual con19 tracts to serve under subsection (c) the Secretary 

20 may pay up to $35,000 on behalf of the individual 

21 for loans described in paragraph (1). With respect to 

22 participants under the Program whose total eligible 

23 loans are less than $105,000, the Secretary shall 

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1 ble loan balance for each year of obligated service of 

2 the individual. 

3 ‘‘(3) TAX LIABILITY.—For the purpose of pro4 viding reimbursements for tax liability resulting 

5 from payments under paragraph (2) on behalf of an 

6 individual, the Secretary shall, in addition to such 

7 payments, make payments to the individual in an 

8 amount not to exceed 39 percent of the total amount 

9 of loan repayments made for the taxable year in10 volved. 

11 ‘‘(e) POSTPONING OBLIGATED SERVICE.—With re12 spect to an individual receiving a degree or certificate from 

13 a health professions or other related school, the date of 

14 the initiation of the period of obligated service may be 

15 postponed as approved by the Secretary. 

16 ‘‘(f) BREACH OF CONTRACT.—An individual who fails 

17 to comply with the contract entered into under subsection 

18 (c) shall be subject to the same financial penalties as pro19 vided for under section 338E for breaches of loan repay20 ment contracts under section 338B. 

21 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

22 is authorized to be appropriated to carry out this section 

23 $195,000,000 for fiscal year 2010, and such sums as may 

24 be necessary for each of fiscal years 2011 through 2015.’’. 


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1 SEC. 5205. ALLIED HEALTH WORKFORCE RECRUITMENT 

2 AND RETENTION PROGRAMS. 

3 (a) PURPOSE.—The purpose of this section is to as4 sure an adequate supply of allied health professionals to 

5 eliminate critical allied health workforce shortages in Fed6 eral, State, local, and tribal public health agencies or in 

7 settings where patients might require health care services, 

8 including acute care facilities, ambulatory care facilities, 

9 personal residences and other settings, as recognized by 

10 the Secretary of Health and Human Services by author11 izing an Allied Health Loan Forgiveness Program. 

12 (b) ALLIED HEALTH WORKFORCE RECRUITMENT

13 AND RETENTION PROGRAM.—Section 428K of the Higher 

14 Education Act of 1965 (20 U.S.C. 1078–11) is amend15 ed— 

16 (1) in subsection (b), by adding at the end the 

17 following: 

18 ‘‘(18) ALLIED HEALTH PROFESSIONALS.—The 

19 individual is employed full-time as an allied health 

20 professional— 

21 ‘‘(A) in a Federal, State, local, or tribal 

22 public health agency; or 

23 ‘‘(B) in a setting where patients might re24 quire health care services, including acute care 

25 facilities, ambulatory care facilities, personal 

26 residences and other settings located in health 


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1 professional shortage areas, medically under2 served areas, or medically underserved popu3 lations, as recognized by the Secretary of 

4 Health and Human Services.’’; and 

5 (2) in subsection (g)— 

6 (A) by redesignating paragraphs (1) 

7 through (9) as paragraphs (2) through (10), re8 spectively; and 

9 (B) by inserting before paragraph (2) (as 

10 redesignated by subparagraph (A)) the fol11 lowing: 

12 ‘‘(1) ALLIED HEALTH PROFESSIONAL.—The 

13 term ‘allied health professional’ means an allied 

14 health professional as defined in section 799B(5) of 

15 the Public Heath Service Act (42 U.S.C. 295p(5)) 

16 who— 

17 ‘‘(A) has graduated and received an allied 

18 health professions degree or certificate from an 

19 institution of higher education; and 

20 ‘‘(B) is employed with a Federal, State, 

21 local or tribal public health agency, or in a set22 ting where patients might require health care 

23 services, including acute care facilities, ambula24 tory care facilities, personal residences and 

25 other settings located in health professional 


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1 shortage areas, medically underserved areas, or 

2 medically underserved populations, as recog3 nized by the Secretary of Health and Human 

4 Services.’’. 

5 SEC. 5206. GRANTS FOR STATE AND LOCAL PROGRAMS. 

6 (a) IN GENERAL.—Section 765(d) of the Public 

7 Health Service Act (42 U.S.C. 295(d)) is amended— 

8 (1) in paragraph (7), by striking ‘‘; or’’ and in9 serting a semicolon; 

10 (2) by redesignating paragraph (8) as para11 graph (9); and 

12 (3) by inserting after paragraph (7) the fol13 lowing: 

14 ‘‘(8) public health workforce loan repayment 

15 programs; or’’. 

16 (b) TRAINING FOR MID-CAREER PUBLIC HEALTH

17 PROFESSIONALS.—Part E of title VII of the Public 

18 Health Service Act (42 U.S.C. 294n et seq.), as amended 

19 by section 5204, is further amended by adding at the end 

20 the following: 

21 ‘‘SEC. 777. TRAINING FOR MID-CAREER PUBLIC AND ALLIED 

22 HEALTH PROFESSIONALS. 

23 ‘‘(a) IN GENERAL.—The Secretary may make grants 

24 to, or enter into contracts with, any eligible entity to 

25 award scholarships to eligible individuals to enroll in deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01331 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 gree or professional training programs for the purpose of 

2 enabling mid-career professionals in the public health and 

3 allied health workforce to receive additional training in the 

4 field of public health and allied health. 

5 ‘‘(b) ELIGIBILITY.— 

6 ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en7 tity’ indicates an accredited educational institution 

8 that offers a course of study, certificate program, or 

9 professional training program in public or allied 

10 health or a related discipline, as determined by the 

11 Secretary 

12 ‘‘(2) ELIGIBLE INDIVIDUALS.—The term ‘eligi13 ble individuals’ includes those individuals employed 

14 in public and allied health positions at the Federal, 

15 State, tribal, or local level who are interested in re16 taining or upgrading their education. 

17 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.—There 

18 is authorized to be appropriated to carry out this section, 

19 $60,000,000 for fiscal year 2010 and such sums as may 

20 be necessary for each of fiscal years 2011 through 2015. 

21 Fifty percent of appropriated funds shall be allotted to 

22 public health mid-career professionals and 50 percent shall 

23 be allotted to allied health mid-career professionals.’’. 


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1 SEC. 5207. FUNDING FOR NATIONAL HEALTH SERVICE 

2 CORPS. 

3 Section 338H(a) of the Public Health Service Act (42 

4 U.S.C. 254q(a)) is amended to read as follows: 

5 ‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—For the 

6 purpose of carrying out this section, there is authorized 

7 to be appropriated, out of any funds in the Treasury not 

8 otherwise appropriated, the following: 

9 ‘‘(1) For fiscal year 2010, $320,461,632. 

10 ‘‘(2) For fiscal year 2011, $414,095,394. 

11 ‘‘(3) For fiscal year 2012, $535,087,442. 

12 ‘‘(4) For fiscal year 2013, $691,431,432. 

13 ‘‘(5) For fiscal year 2014, $893,456,433. 

14 ‘‘(6) For fiscal year 2015, $1,154,510,336. 

15 ‘‘(7) For fiscal year 2016, and each subsequent 

16 fiscal year, the amount appropriated for the pre17 ceding fiscal year adjusted by the product of— 

18 ‘‘(A) one plus the average percentage in19 crease in the costs of health professions edu20 cation during the prior fiscal year; and 

21 ‘‘(B) one plus the average percentage 

22 change in the number of individuals residing in 

23 health professions shortage areas designated 

24 under section 333 during the prior fiscal year, 

25 relative to the number of individuals residing in 

26 such areas during the previous fiscal year.’’. 


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1 SEC. 5208. NURSE-MANAGED HEALTH CLINICS. 

2 (a) PURPOSE.—The purpose of this section is to fund 

3 the development and operation of nurse-managed health 

4 clinics. 

5 (b) GRANTS.—Subpart 1 of part D of title III of the 

6 Public Health Service Act (42 U.S.C. 254b et seq.) is 

7 amended by inserting after section 330A the following: 

8 ‘‘SEC. 330A–1. GRANTS TO NURSE–MANAGED HEALTH CLIN9 ICS. 

10 ‘‘(a) DEFINITIONS.— 

11 ‘‘(1) COMPREHENSIVE PRIMARY HEALTH CARE

12 SERVICES.—In this section, the term ‘comprehensive 

13 primary health care services’ means the primary 

14 health services described in section 330(b)(1). 

15 ‘‘(2) NURSE-MANAGED HEALTH CLINIC.—The 

16 term ‘nurse-managed health clinic’ means a nurse17 practice arrangement, managed by advanced practice 

18 nurses, that provides primary care or wellness serv19 ices to underserved or vulnerable populations and 

20 that is associated with a school, college, university or 

21 department of nursing, federally qualified health 

22 center, or independent nonprofit health or social 

23 services agency. 

24 ‘‘(b) AUTHORITY TO AWARD GRANTS.—The Sec25 retary shall award grants for the cost of the operation of 


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1 nurse-managed health clinics that meet the requirements 

2 of this section. 

3 ‘‘(c) APPLICATIONS.—To be eligible to receive a grant 

4 under this section, an entity shall— 

5 ‘‘(1) be an NMHC; and 

6 ‘‘(2) submit to the Secretary an application at 

7 such time, in such manner, and containing— 

8 ‘‘(A) assurances that nurses are the major 

9 providers of services at the NMHC and that at 

10 least 1 advanced practice nurse holds an execu11 tive management position within the organiza12 tional structure of the NMHC; 

13 ‘‘(B) an assurance that the NMHC will 

14 continue providing comprehensive primary 

15 health care services or wellness services without 

16 regard to income or insurance status of the pa17 tient for the duration of the grant period; and 

18 ‘‘(C) an assurance that, not later than 90 

19 days of receiving a grant under this section, the 

20 NMHC will establish a community advisory 

21 committee, for which a majority of the members 

22 shall be individuals who are served by the 

23 NMHC. 


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1 ‘‘(d) GRANT AMOUNT.—The amount of any grant 

2 made under this section for any fiscal year shall be deter3 mined by the Secretary, taking into account— 

4 ‘‘(1) the financial need of the NMHC, consid5 ering State, local, and other operational funding pro6 vided to the NMHC; and 

7 ‘‘(2) other factors, as the Secretary determines 

8 appropriate. 

9 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—For the 

10 purposes of carrying out this section, there are authorized 

11 to be appropriated $50,000,000 for the fiscal year 2010 

12 and such sums as may be necessary for each of the fiscal 

13 years 2011 through 2014.’’. 

14 SEC. 5209. ELIMINATION OF CAP ON COMMISSIONED 

15 CORPS. 

16 Section 202 of the Department of Health and Human 

17 Services Appropriations Act, 1993 (Public Law 102-394) 

18 is amended by striking ‘‘not to exceed 2,800’’. 

19 SEC. 5210. ESTABLISHING A READY RESERVE CORPS. 

20 Section 203 of the Public Health Service Act (42 

21 U.S.C. 204) is amended to read as follows: 

22 ‘‘SEC. 203. COMMISSIONED CORPS AND READY RESERVE 

23 CORPS. 

24 ‘‘(a) ESTABLISHMENT.— 


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1 ‘‘(1) IN GENERAL.—There shall be in the Serv2 ice a commissioned Regular Corps and a Ready Re3 serve Corps for service in time of national emer4 gency. 

5 ‘‘(2) REQUIREMENT.—All commissioned officers 

6 shall be citizens of the United States and shall be 

7 appointed without regard to the civil-service laws 

8 and compensated without regard to the Classifica9 tion Act of 1923, as amended. 

10 ‘‘(3) APPOINTMENT.—Commissioned officers of 

11 the Ready Reserve Corps shall be appointed by the 

12 President and commissioned officers of the Regular 

13 Corps shall be appointed by the President with the 

14 advice and consent of the Senate. 

15 ‘‘(4) ACTIVE DUTY.—Commissioned officers of 

16 the Ready Reserve Corps shall at all times be sub17 ject to call to active duty by the Surgeon General, 

18 including active duty for the purpose of training. 

19 ‘‘(5) WARRANT OFFICERS.—Warrant officers 

20 may be appointed to the Service for the purpose of 

21 providing support to the health and delivery systems 

22 maintained by the Service and any warrant officer 

23 appointed to the Service shall be considered for pur24 poses of this Act and title 37, United States Code, 


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1 to be a commissioned officer within the Commis2 sioned Corps of the Service. 

3 ‘‘(b) ASSIMILATING RESERVE CORP OFFICERS INTO

4 THE REGULAR CORPS.—Effective on the date of enact5 ment of the Patient Protection and Affordable Care Act, 

6 all individuals classified as officers in the Reserve Corps 

7 under this section (as such section existed on the day be8 fore the date of enactment of such Act) and serving on 

9 active duty shall be deemed to be commissioned officers 

10 of the Regular Corps. 

11 ‘‘(c) PURPOSE AND USE OF READY RESEARCH.— 

12 ‘‘(1) PURPOSE.—The purpose of the Ready Re13 serve Corps is to fulfill the need to have additional 

14 Commissioned Corps personnel available on short 

15 notice (similar to the uniformed service’s reserve 

16 program) to assist regular Commissioned Corps per17 sonnel to meet both routine public health and emer18 gency response missions. 

19 ‘‘(2) USES.—The Ready Reserve Corps shall— 

20 ‘‘(A) participate in routine training to 

21 meet the general and specific needs of the Com22 missioned Corps; 

23 ‘‘(B) be available and ready for involuntary 

24 calls to active duty during national emergencies 


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1 and public health crises, similar to the uni2 formed service reserve personnel; 

3 ‘‘(C) be available for backfilling critical po4 sitions left vacant during deployment of active 

5 duty Commissioned Corps members, as well as 

6 for deployment to respond to public health 

7 emergencies, both foreign and domestic; and 

8 ‘‘(D) be available for service assignment in 

9 isolated, hardship, and medically underserved 

10 communities (as defined in section 799B) to 

11 improve access to health services. 

12 ‘‘(d) FUNDING.—For the purpose of carrying out the 

13 duties and responsibilities of the Commissioned Corps 

14 under this section, there are authorized to be appropriated 

15 $5,000,000 for each of fiscal years 2010 through 2014 

16 for recruitment and training and $12,500,000 for each of 

17 fiscal years 2010 through 2014 for the Ready Reserve 

18 Corps.’’. 

19 Subtitle D—Enhancing Health Care 

20 Workforce Education and Training 

21 SEC. 5301. TRAINING IN FAMILY MEDICINE, GENERAL IN22 TERNAL MEDICINE, GENERAL PEDIATRICS, 

23 AND PHYSICIAN ASSISTANTSHIP. 

24 Part C of title VII (42 U.S.C. 293k et seq.) is amend25 ed by striking section 747 and inserting the following: 


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1 ‘‘SEC. 747. PRIMARY CARE TRAINING AND ENHANCEMENT. 

2 ‘‘(a) SUPPORT AND DEVELOPMENT OF PRIMARY

3 CARE TRAINING PROGRAMS.— 

4 ‘‘(1) IN GENERAL.—The Secretary may make 

5 grants to, or enter into contracts with, an accredited 

6 public or nonprofit private hospital, school of medi7 cine or osteopathic medicine, academically affiliated 

8 physician assistant training program, or a public or 

9 private nonprofit entity which the Secretary has de10 termined is capable of carrying out such grant or 

11 contract— 

12 ‘‘(A) to plan, develop, operate, or partici13 pate in an accredited professional training pro14 gram, including an accredited residency or in15 ternship program in the field of family medi16 cine, general internal medicine, or general pedi17 atrics for medical students, interns, residents, 

18 or practicing physicians as defined by the Sec19 retary; 

20 ‘‘(B) to provide need-based financial assist21 ance in the form of traineeships and fellowships 

22 to medical students, interns, residents, prac23 ticing physicians, or other medical personnel, 

24 who are participants in any such program, and 

25 who plan to specialize or work in the practice 

26 of the fields defined in subparagraph (A); 


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1 ‘‘(C) to plan, develop, and operate a pro2 gram for the training of physicians who plan to 

3 teach in family medicine, general internal medi4 cine, or general pediatrics training programs; 

5 ‘‘(D) to plan, develop, and operate a pro6 gram for the training of physicians teaching in 

7 community-based settings; 

8 ‘‘(E) to provide financial assistance in the 

9 form of traineeships and fellowships to physi10 cians who are participants in any such pro11 grams and who plan to teach or conduct re12 search in a family medicine, general internal 

13 medicine, or general pediatrics training pro14 gram; 

15 ‘‘(F) to plan, develop, and operate a physi16 cian assistant education program, and for the 

17 training of individuals who will teach in pro18 grams to provide such training; 

19 ‘‘(G) to plan, develop, and operate a dem20 onstration program that provides training in 

21 new competencies, as recommended by the Ad22 visory Committee on Training in Primary Care 

23 Medicine and Dentistry and the National 

24 Health Care Workforce Commission established 


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1 in section 5101 of the Patient Protection and 

2 Affordable Care Act, which may include— 

3 ‘‘(i) providing training to primary 

4 care physicians relevant to providing care 

5 through patient-centered medical homes 

6 (as defined by the Secretary for purposes 

7 of this section); 

8 ‘‘(ii) developing tools and curricula 

9 relevant to patient-centered medical homes; 

10 and 

11 ‘‘(iii) providing continuing education 

12 to primary care physicians relevant to pa13 tient-centered medical homes; and 

14 ‘‘(H) to plan, develop, and operate joint 

15 degree programs to provide interdisciplinary 

16 and interprofessional graduate training in pub17 lic health and other health professions to pro18 vide training in environmental health, infectious 

19 disease control, disease prevention and health 

20 promotion, epidemiological studies and injury 

21 control. 

22 ‘‘(2) DURATION OF AWARDS.—The period dur23 ing which payments are made to an entity from an 

24 award of a grant or contract under this subsection 

25 shall be 5 years. 


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1 ‘‘(b) CAPACITY BUILDING IN PRIMARY CARE.— 

2 ‘‘(1) IN GENERAL.—The Secretary may make 

3 grants to or enter into contracts with accredited 

4 schools of medicine or osteopathic medicine to estab5 lish, maintain, or improve— 

6 ‘‘(A) academic units or programs that im7 prove clinical teaching and research in fields de8 fined in subsection (a)(1)(A); or 

9 ‘‘(B) programs that integrate academic ad10 ministrative units in fields defined in subsection 

11 (a)(1)(A) to enhance interdisciplinary recruit12 ment, training, and faculty development. 

13 ‘‘(2) PREFERENCE IN MAKING AWARDS UNDER

14 THIS SUBSECTION.—In making awards of grants 

15 and contracts under paragraph (1), the Secretary 

16 shall give preference to any qualified applicant for 

17 such an award that agrees to expend the award for 

18 the purpose of— 

19 ‘‘(A) establishing academic units or pro20 grams in fields defined in subsection (a)(1)(A); 

21 or 

22 ‘‘(B) substantially expanding such units or 

23 programs. 

24 ‘‘(3) PRIORITIES IN MAKING AWARDS.—In 

25 awarding grants or contracts under paragraph (1), 


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1 the Secretary shall give priority to qualified appli2 cants that— 

3 ‘‘(A) proposes a collaborative project be4 tween academic administrative units of primary 

5 care; 

6 ‘‘(B) proposes innovative approaches to 

7 clinical teaching using models of primary care, 

8 such as the patient centered medical home, 

9 team management of chronic disease, and inter10 professional integrated models of health care 

11 that incorporate transitions in health care set12 tings and integration physical and mental 

13 health provision; 

14 ‘‘(C) have a record of training the greatest 

15 percentage of providers, or that have dem16 onstrated significant improvements in the per17 centage of providers trained, who enter and re18 main in primary care practice; 

19 ‘‘(D) have a record of training individuals 

20 who are from underrepresented minority groups 

21 or from a rural or disadvantaged background; 

22 ‘‘(E) provide training in the care of vulner23 able populations such as children, older adults, 

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1 stance-related disorders, individuals with HIV/ 

2 AIDS, and individuals with disabilities; 

3 ‘‘(F) establish formal relationships and 

4 submit joint applications with federally qualified 

5 health centers, rural health clinics, area health 

6 education centers, or clinics located in under7 served areas or that serve underserved popu8 lations; 

9 ‘‘(G) teach trainees the skills to provide 

10 interprofessional, integrated care through col11 laboration among health professionals; 

12 ‘‘(H) provide training in enhanced commu13 nication with patients, evidence-based practice, 

14 chronic disease management, preventive care, 

15 health information technology, or other com16 petencies as recommended by the Advisory 

17 Committee on Training in Primary Care Medi18 cine and Dentistry and the National Health 

19 Care Workforce Commission established in sec20 tion 5101 of the Patient Protection and Afford21 able Care Act; or 

22 ‘‘(I) provide training in cultural com23 petency and health literacy. 

24 ‘‘(4) DURATION OF AWARDS.—The period dur25 ing which payments are made to an entity from an 


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1 award of a grant or contract under this subsection 

2 shall be 5 years. 

3 ‘‘(c) AUTHORIZATION OF APPROPRIATIONS.— 

4 ‘‘(1) IN GENERAL.—For purposes of carrying 

5 out this section (other than subsection (b)(1)(B)), 

6 there are authorized to be appropriated 

7 $125,000,000 for fiscal year 2010, and such sums 

8 as may be necessary for each of fiscal years 2011 

9 through 2014. 

10 ‘‘(2) TRAINING PROGRAMS.—Fifteen percent of 

11 the amount appropriated pursuant to paragraph (1) 

12 in each such fiscal year shall be allocated to the phy13 sician assistant training programs described in sub14 section (a)(1)(F), which prepare students for prac15 tice in primary care. 

16 ‘‘(3) INTEGRATING ACADEMIC ADMINISTRATIVE

17 UNITS.—For purposes of carrying out subsection 

18 (b)(1)(B), there are authorized to be appropriated 

19 $750,000 for each of fiscal years 2010 through 

20 2014.’’. 

21 SEC. 5302. TRAINING OPPORTUNITIES FOR DIRECT CARE 

22 WORKERS. 

23 Part C of title VII of the Public Health Service Act 

24 (42 U.S.C. 293k et seq.) is amended by inserting after 

25 section 747, as amended by section 5301, the following: 


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1 ‘‘SEC. 747A. TRAINING OPPORTUNITIES FOR DIRECT CARE 

2 WORKERS. 

3 ‘‘(a) IN GENERAL.—The Secretary shall award 

4 grants to eligible entities to enable such entities to provide 

5 new training opportunities for direct care workers who are 

6 employed in long-term care settings such as nursing 

7 homes (as defined in section 1908(e)(1) of the Social Se8 curity Act (42 U.S.C. 1396g(e)(1)), assisted living facili9 ties and skilled nursing facilities, intermediate care facili10 ties for individuals with mental retardation, home and 

11 community based settings, and any other setting the Sec12 retary determines to be appropriate. 

13 ‘‘(b) ELIGIBILITY.—To be eligible to receive a grant 

14 under this section, an entity shall— 

15 ‘‘(1) be an institution of higher education (as 

16 defined in section 102 of the Higher Education Act 

17 of 1965 (20 U.S.C. 1002)) that— 

18 ‘‘(A) is accredited by a nationally recog19 nized accrediting agency or association listed 

20 under section 101(c) of the Higher Education 

21 Act of 1965 (20 U.S.C. 1001(c)); and 

22 ‘‘(B) has established a public-private edu23 cational partnership with a nursing home or 

24 skilled nursing facility, agency or entity pro25 viding home and community based services to 


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1 individuals with disabilities, or other long-term 

2 care provider; and 

3 ‘‘(2) submit to the Secretary an application at 

4 such time, in such manner, and containing such in5 formation as the Secretary may require. 

6 ‘‘(c) USE OF FUNDS.—An eligible entity shall use 

7 amounts awarded under a grant under this section to pro8 vide assistance to eligible individuals to offset the cost of 

9 tuition and required fees for enrollment in academic pro10 grams provided by such entity. 

11 ‘‘(d) ELIGIBLE INDIVIDUAL.— 

12 ‘‘(1) ELIGIBILITY.—To be eligible for assistance 

13 under this section, an individual shall be enrolled in 

14 courses provided by a grantee under this subsection 

15 and maintain satisfactory academic progress in such 

16 courses. 

17 ‘‘(2) CONDITION OF ASSISTANCE.—As a condi18 tion of receiving assistance under this section, an in19 dividual shall agree that, following completion of the 

20 assistance period, the individual will work in the 

21 field of geriatrics, disability services, long term serv22 ices and supports, or chronic care management for 

23 a minimum of 2 years under guidelines set by the 

24 Secretary. 


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1 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.—There 

2 is authorized to be appropriated to carry out this section, 

3 $10,000,000 for the period of fiscal years 2011 through 

4 2013.’’. 

5 SEC. 5303. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC 

6 HEALTH DENTISTRY. 

7 Part C of Title VII of the Public Health Service Act 

8 (42 U.S.C. 293k et seq.) is amended by— 

9 (1) redesignating section 748, as amended by 

10 section 5103 of this Act, as section 749; and 

11 (2) inserting after section 747A, as added by 

12 section 5302, the following: 

13 ‘‘SEC. 748. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC 

14 HEALTH DENTISTRY. 

15 ‘‘(a) SUPPORT AND DEVELOPMENT OF DENTAL

16 TRAINING PROGRAMS.— 

17 ‘‘(1) IN GENERAL.—The Secretary may make 

18 grants to, or enter into contracts with, a school of 

19 dentistry, public or nonprofit private hospital, or a 

20 public or private nonprofit entity which the Sec21 retary has determined is capable of carrying out 

22 such grant or contract— 

23 ‘‘(A) to plan, develop, and operate, or par24 ticipate in, an approved professional training 

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1 atric dentistry, or public health dentistry for 

2 dental students, residents, practicing dentists, 

3 dental hygienists, or other approved primary 

4 care dental trainees, that emphasizes training 

5 for general, pediatric, or public health dentistry; 

6 ‘‘(B) to provide financial assistance to den7 tal students, residents, practicing dentists, and 

8 dental hygiene students who are in need there9 of, who are participants in any such program, 

10 and who plan to work in the practice of general, 

11 pediatric, public heath dentistry, or dental hy12 giene; 

13 ‘‘(C) to plan, develop, and operate a pro14 gram for the training of oral health care pro15 viders who plan to teach in general, pediatric, 

16 public health dentistry, or dental hygiene; 

17 ‘‘(D) to provide financial assistance in the 

18 form of traineeships and fellowships to dentists 

19 who plan to teach or are teaching in general, 

20 pediatric, or public health dentistry; 

21 ‘‘(E) to meet the costs of projects to estab22 lish, maintain, or improve dental faculty devel23 opment programs in primary care (which may 

24 be departments, divisions or other units); 


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1 ‘‘(F) to meet the costs of projects to estab2 lish, maintain, or improve predoctoral and 

3 postdoctoral training in primary care programs; 

4 ‘‘(G) to create a loan repayment program 

5 for faculty in dental programs; and 

6 ‘‘(H) to provide technical assistance to pe7 diatric training programs in developing and im8 plementing instruction regarding the oral health 

9 status, dental care needs, and risk-based clin10 ical disease management of all pediatric popu11 lations with an emphasis on underserved chil12 dren. 

13 ‘‘(2) FACULTY LOAN REPAYMENT.— 

14 ‘‘(A) IN GENERAL.—A grant or contract 

15 under subsection (a)(1)(G) may be awarded to 

16 a program of general, pediatric, or public health 

17 dentistry described in such subsection to plan, 

18 develop, and operate a loan repayment program 

19 under which— 

20 ‘‘(i) individuals agree to serve full21 time as faculty members; and 

22 ‘‘(ii) the program of general, pediatric 

23 or public health dentistry agrees to pay the 

24 principal and interest on the outstanding 

25 student loans of the individuals. 


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1 ‘‘(B) MANNER OF PAYMENTS.—With re2 spect to the payments described in subpara3 graph (A)(ii), upon completion by an individual 

4 of each of the first, second, third, fourth, and 

5 fifth years of service, the program shall pay an 

6 amount equal to 10, 15, 20, 25, and 30 per7 cent, respectively, of the individual’s student 

8 loan balance as calculated based on principal 

9 and interest owed at the initiation of the agree10 ment. 

11 ‘‘(b) ELIGIBLE ENTITY.—For purposes of this sub12 section, entities eligible for such grants or contracts in 

13 general, pediatric, or public health dentistry shall include 

14 entities that have programs in dental or dental hygiene 

15 schools, or approved residency or advanced education pro16 grams in the practice of general, pediatric, or public health 

17 dentistry. Eligible entities may partner with schools of 

18 public health to permit the education of dental students, 

19 residents, and dental hygiene students for a master’s year 

20 in public health at a school of public health. 

21 ‘‘(c) PRIORITIES IN MAKING AWARDS.—With respect 

22 to training provided for under this section, the Secretary 

23 shall give priority in awarding grants or contracts to the 

24 following: 


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1 ‘‘(1) Qualified applicants that propose collabo2 rative projects between departments of primary care 

3 medicine and departments of general, pediatric, or 

4 public health dentistry. 

5 ‘‘(2) Qualified applicants that have a record of 

6 training the greatest percentage of providers, or that 

7 have demonstrated significant improvements in the 

8 percentage of providers, who enter and remain in 

9 general, pediatric, or public health dentistry. 

10 ‘‘(3) Qualified applicants that have a record of 

11 training individuals who are from a rural or dis12 advantaged background, or from underrepresented 

13 minorities. 

14 ‘‘(4) Qualified applicants that establish formal 

15 relationships with Federally qualified health centers, 

16 rural health centers, or accredited teaching facilities 

17 and that conduct training of students, residents, fel18 lows, or faculty at the center or facility. 

19 ‘‘(5) Qualified applicants that conduct teaching 

20 programs targeting vulnerable populations such as 

21 older adults, homeless individuals, victims of abuse 

22 or trauma, individuals with mental health or sub23 stance-related disorders, individuals with disabilities, 

24 and individuals with HIV/AIDS, and in the risk25 based clinical disease management of all populations. 


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1 ‘‘(6) Qualified applicants that include edu2 cational activities in cultural competency and health 

3 literacy. 

4 ‘‘(7) Qualified applicants that have a high rate 

5 for placing graduates in practice settings that serve 

6 underserved areas or health disparity populations, or 

7 who achieve a significant increase in the rate of 

8 placing graduates in such settings. 

9 ‘‘(8) Qualified applicants that intend to estab10 lish a special populations oral health care education 

11 center or training program for the didactic and clin12 ical education of dentists, dental health profes13 sionals, and dental hygienists who plan to teach oral 

14 health care for people with developmental disabil15 ities, cognitive impairment, complex medical prob16 lems, significant physical limitations, and vulnerable 

17 elderly. 

18 ‘‘(d) APPLICATION.—An eligible entity desiring a 

19 grant under this section shall submit to the Secretary an 

20 application at such time, in such manner, and containing 

21 such information as the Secretary may require. 

22 ‘‘(e) DURATION OF AWARD.—The period during 

23 which payments are made to an entity from an award of 

24 a grant or contract under subsection (a) shall be 5 years. 

25 The provision of such payments shall be subject to annual 


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1 approval by the Secretary and subject to the availability 

2 of appropriations for the fiscal year involved to make the 

3 payments. 

4 ‘‘(f) AUTHORIZATIONS OF APPROPRIATIONS.—For 

5 the purpose of carrying out subsections (a) and (b), there 

6 is authorized to be appropriated $30,000,000 for fiscal 

7 year 2010 and such sums as may be necessary for each 

8 of fiscal years 2011 through 2015. 

9 ‘‘(g) CARRYOVER FUNDS.—An entity that receives an 

10 award under this section may carry over funds from 1 fis11 cal year to another without obtaining approval from the 

12 Secretary. In no case may any funds be carried over pur13 suant to the preceding sentence for more than 3 years.’’. 

14 SEC. 5304. ALTERNATIVE DENTAL HEALTH CARE PRO15 VIDERS DEMONSTRATION PROJECT. 

16 Subpart X of part D of title III of the Public Health 

17 Service Act (42 U.S.C. 256f et seq.) is amended by adding 

18 at the end the following: 

19 ‘‘SEC. 340G–1. DEMONSTRATION PROGRAM. 

20 ‘‘(a) IN GENERAL.— 

21 ‘‘(1) AUTHORIZATION.—The Secretary is au22 thorized to award grants to 15 eligible entities to en23 able such entities to establish a demonstration pro24 gram to establish training programs to train, or to 

25 employ, alternative dental health care providers in 


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1 order to increase access to dental health care serv2 ices in rural and other underserved communities. 

3 ‘‘(2) DEFINITION.—The term ‘alternative den4 tal health care providers’ includes community dental 

5 health coordinators, advance practice dental hygien6 ists, independent dental hygienists, supervised dental 

7 hygienists, primary care physicians, dental thera8 pists, dental health aides, and any other health pro9 fessional that the Secretary determines appropriate. 

10 ‘‘(b) TIMEFRAME.—The demonstration projects fund11 ed under this section shall begin not later than 2 years 

12 after the date of enactment of this section, and shall con13 clude not later than 7 years after such date of enactment. 

14 ‘‘(c) ELIGIBLE ENTITIES.—To be eligible to receive 

15 a grant under subsection (a), an entity shall— 

16 ‘‘(1) be— 

17 ‘‘(A) an institution of higher education, in18 cluding a community college; 

19 ‘‘(B) a public-private partnership; 

20 ‘‘(C) a federally qualified health center; 

21 ‘‘(D) an Indian Health Service facility or a 

22 tribe or tribal organization (as such terms are 

23 defined in section 4 of the Indian Self-Deter24 mination and Education Assistance Act); 


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1 ‘‘(E) a State or county public health clinic, 

2 a health facility operated by an Indian tribe or 

3 tribal organization, or urban Indian organiza4 tion providing dental services; or 

5 ‘‘(F) a public hospital or health system; 

6 ‘‘(2) be within a program accredited by the 

7 Commission on Dental Accreditation or within a 

8 dental education program in an accredited institu9 tion; and 

10 ‘‘(3) shall submit an application to the Sec11 retary at such time, in such manner, and containing 

12 such information as the Secretary may require. 

13 ‘‘(d) ADMINISTRATIVE PROVISIONS.— 

14 ‘‘(1) AMOUNT OF GRANT.—Each grant under 

15 this section shall be in an amount that is not less 

16 than $4,000,000 for the 5-year period during which 

17 the demonstration project being conducted. 

18 ‘‘(2) DISBURSEMENT OF FUNDS.— 

19 ‘‘(A) PRELIMINARY DISBURSEMENTS.—Be20 ginning 1 year after the enactment of this sec21 tion, the Secretary may disperse to any entity 

22 receiving a grant under this section not more 

23 than 20 percent of the total funding awarded to 

24 such entity under such grant, for the purpose 


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1 of enabling the entity to plan the demonstration 

2 project to be conducted under such grant. 

3 ‘‘(B) SUBSEQUENT DISBURSEMENTS.—The 

4 remaining amount of grant funds not dispersed 

5 under subparagraph (A) shall be dispersed such 

6 that not less than 15 percent of such remaining 

7 amount is dispersed each subsequent year. 

8 ‘‘(e) COMPLIANCE WITH STATE REQUIREMENTS.— 

9 Each entity receiving a grant under this section shall cer10 tify that it is in compliance with all applicable State licens11 ing requirements. 

12 ‘‘(f) EVALUATION.—The Secretary shall contract 

13 with the Director of the Institute of Medicine to conduct 

14 a study of the demonstration programs conducted under 

15 this section that shall provide analysis, based upon quan16 titative and qualitative data, regarding access to dental 

17 health care in the United States. 

18 ‘‘(g) CLARIFICATION REGARDING DENTAL HEALTH

19 AIDE PROGRAM.—Nothing in this section shall prohibit a 

20 dental health aide training program approved by the In21 dian Health Service from being eligible for a grant under 

22 this section. 

23 ‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There 

24 is authorized to be appropriated such sums as may be nec25 essary to carry out this section.’’. 


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1 SEC. 5305. GERIATRIC EDUCATION AND TRAINING; CAREER 

2 AWARDS; COMPREHENSIVE GERIATRIC EDU3 CATION. 

4 (a) WORKFORCE DEVELOPMENT; CAREER

5 AWARDS.—Section 753 of the Public Health Service Act 

6 (42 U.S.C. 294c) is amended by adding at the end the 

7 following: 

8 ‘‘(d) GERIATRIC WORKFORCE DEVELOPMENT.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall award 

10 grants or contracts under this subsection to entities 

11 that operate a geriatric education center pursuant to 

12 subsection (a)(1). 

13 ‘‘(2) APPLICATION.—To be eligible for an 

14 award under paragraph (1), an entity described in 

15 such paragraph shall submit to the Secretary an ap16 plication at such time, in such manner, and con17 taining such information as the Secretary may re18 quire. 

19 ‘‘(3) USE OF FUNDS.—Amounts awarded under 

20 a grant or contract under paragraph (1) shall be 

21 used to— 

22 ‘‘(A) carry out the fellowship program de23 scribed in paragraph (4); and 

24 ‘‘(B) carry out 1 of the 2 activities de25 scribed in paragraph (5). 

26 ‘‘(4) FELLOWSHIP PROGRAM.— 


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1 ‘‘(A) IN GENERAL.—Pursuant to para2 graph (3), a geriatric education center that re3 ceives an award under this subsection shall use 

4 such funds to offer short-term intensive courses 

5 (referred to in this subsection as a ‘fellowship’) 

6 that focus on geriatrics, chronic care manage7 ment, and long-term care that provide supple8 mental training for faculty members in medical 

9 schools and other health professions schools 

10 with programs in psychology, pharmacy, nurs11 ing, social work, dentistry, public health, allied 

12 health, or other health disciplines, as approved 

13 by the Secretary. Such a fellowship shall be 

14 open to current faculty, and appropriately 

15 credentialed volunteer faculty and practitioners, 

16 who do not have formal training in geriatrics, 

17 to upgrade their knowledge and clinical skills 

18 for the care of older adults and adults with 

19 functional limitations and to enhance their 

20 interdisciplinary teaching skills. 

21 ‘‘(B) LOCATION.—A fellowship shall be of22 fered either at the geriatric education center 

23 that is sponsoring the course, in collaboration 

24 with other geriatric education centers, or at 

25 medical schools, schools of dentistry, schools of 


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1 nursing, schools of pharmacy, schools of social 

2 work, graduate programs in psychology, or al3 lied health and other health professions schools 

4 approved by the Secretary with which the geri5 atric education centers are affiliated. 

6 ‘‘(C) CME CREDIT.—Participation in a fel7 lowship under this paragraph shall be accepted 

8 with respect to complying with continuing 

9 health profession education requirements. As a 

10 condition of such acceptance, the recipient shall 

11 agree to subsequently provide a minimum of 18 

12 hours of voluntary instructional support 

13 through a geriatric education center that is pro14 viding clinical training to students or trainees 

15 in long-term care settings. 

16 ‘‘(5) ADDITIONAL REQUIRED ACTIVITIES DE17 SCRIBED.—Pursuant to paragraph (3), a geriatric 

18 education center that receives an award under this 

19 subsection shall use such funds to carry out 1 of the 

20 following 2 activities. 

21 ‘‘(A) FAMILY CAREGIVER AND DIRECT

22 CARE PROVIDER TRAINING.—A geriatric edu23 cation center that receives an award under this 

24 subsection shall offer at least 2 courses each 

25 year, at no charge or nominal cost, to family 


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1 caregivers and direct care providers that are de2 signed to provide practical training for sup3 porting frail elders and individuals with disabil4 ities. The Secretary shall require such Centers 

5 to work with appropriate community partners 

6 to develop training program content and to 

7 publicize the availability of training courses in 

8 their service areas. All family caregiver and di9 rect care provider training programs shall in10 clude instruction on the management of psycho11 logical and behavioral aspects of dementia, com12 munication techniques for working with individ13 uals who have dementia, and the appropriate, 

14 safe, and effective use of medications for older 

15 adults. 

16 ‘‘(B) INCORPORATION OF BEST PRAC17 TICES.—A geriatric education center that re18 ceives an award under this subsection shall de19 velop and include material on depression and 

20 other mental disorders common among older 

21 adults, medication safety issues for older adults, 

22 and management of the psychological and be23 havioral aspects of dementia and communica24 tion techniques with individuals who have deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01362 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 mentia in all training courses, where appro2 priate. 

3 ‘‘(6) TARGETS.—A geriatric education center 

4 that receives an award under this subsection shall 

5 meet targets approved by the Secretary for providing 

6 geriatric training to a certain number of faculty or 

7 practitioners during the term of the award, as well 

8 as other parameters established by the Secretary. 

9 ‘‘(7) AMOUNT OF AWARD.—An award under 

10 this subsection shall be in an amount of $150,000. 

11 Not more than 24 geriatric education centers may 

12 receive an award under this subsection. 

13 ‘‘(8) MAINTENANCE OF EFFORT.—A geriatric 

14 education center that receives an award under this 

15 subsection shall provide assurances to the Secretary 

16 that funds provided to the geriatric education center 

17 under this subsection will be used only to supple18 ment, not to supplant, the amount of Federal, State, 

19 and local funds otherwise expended by the geriatric 

20 education center. 

21 ‘‘(9) AUTHORIZATION OF APPROPRIATIONS.—In 

22 addition to any other funding available to carry out 

23 this section, there is authorized to be appropriated 

24 to carry out this subsection, $10,800,000 for the pe25 riod of fiscal year 2011 through 2014. 


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1 ‘‘(e) GERIATRIC CAREER INCENTIVE AWARDS.— 

2 ‘‘(1) IN GENERAL.—The Secretary shall award 

3 grants or contracts under this section to individuals 

4 described in paragraph (2) to foster greater interest 

5 among a variety of health professionals in entering 

6 the field of geriatrics, long-term care, and chronic 

7 care management. 

8 ‘‘(2) ELIGIBLE INDIVIDUALS.—To be eligible to 

9 received an award under paragraph (1), an indi10 vidual shall— 

11 ‘‘(A) be an advanced practice nurse, a clin12 ical social worker, a pharmacist, or student of 

13 psychology who is pursuing a doctorate or other 

14 advanced degree in geriatrics or related fields in 

15 an accredited health professions school; and 

16 ‘‘(B) submit to the Secretary an applica17 tion at such time, in such manner, and con18 taining such information as the Secretary may 

19 require. 

20 ‘‘(3) CONDITION OF AWARD.—As a condition of 

21 receiving an award under this subsection, an indi22 vidual shall agree that, following completion of the 

23 award period, the individual will teach or practice in 

24 the field of geriatrics, long-term care, or chronic 


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1 care management for a minimum of 5 years under 

2 guidelines set by the Secretary. 

3 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

4 There is authorized to be appropriated to carry out 

5 this subsection, $10,000,000 for the period of fiscal 

6 years 2011 through 2013.’’. 

7 (b) EXPANSION OF ELIGIBILITY FOR GERIATRIC

8 ACADEMIC CAREER AWARDS; PAYMENT TO INSTITU9 TION.—Section 753(c) of the Public Health Service Act 

10 294(c)) is amended— 

11 (1) by redesignating paragraphs (4) and (5) as 

12 paragraphs (5) and (6), respectively; 

13 (2) by striking paragraph (2) through para14 graph (3) and inserting the following: 

15 ‘‘(2) ELIGIBLE INDIVIDUALS.—To be eligible to 

16 receive an Award under paragraph (1), an individual 

17 shall— 

18 ‘‘(A) be board certified or board eligible in 

19 internal medicine, family practice, psychiatry, 

20 or licensed dentistry, or have completed any re21 quired training in a discipline and employed in 

22 an accredited health professions school that is 

23 approved by the Secretary; 

24 ‘‘(B) have completed an approved fellow25 ship program in geriatrics or have completed 


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1 specialty training in geriatrics as required by 

2 the discipline and any addition geriatrics train3 ing as required by the Secretary; and 

4 ‘‘(C) have a junior (non-tenured) faculty 

5 appointment at an accredited (as determined by 

6 the Secretary) school of medicine, osteopathic 

7 medicine, nursing, social work, psychology, den8 tistry, pharmacy, or other allied health dis9 ciplines in an accredited health professions 

10 school that is approved by the Secretary. 

11 ‘‘(3) LIMITATIONS.—No Award under para12 graph (1) may be made to an eligible individual un13 less the individual— 

14 ‘‘(A) has submitted to the Secretary an ap15 plication, at such time, in such manner, and 

16 containing such information as the Secretary 

17 may require, and the Secretary has approved 

18 such application; 

19 ‘‘(B) provides, in such form and manner as 

20 the Secretary may require, assurances that the 

21 individual will meet the service requirement de22 scribed in paragraph (6); and 

23 ‘‘(C) provides, in such form and manner as 

24 the Secretary may require, assurances that the 

25 individual has a full-time faculty appointment 


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1 in a health professions institution and docu2 mented commitment from such institution to 

3 spend 75 percent of the total time of such indi4 vidual on teaching and developing skills in 

5 interdisciplinary education in geriatrics. 

6 ‘‘(4) MAINTENANCE OF EFFORT.—An eligible 

7 individual that receives an Award under paragraph 

8 (1) shall provide assurances to the Secretary that 

9 funds provided to the eligible individual under this 

10 subsection will be used only to supplement, not to 

11 supplant, the amount of Federal, State, and local 

12 funds otherwise expended by the eligible individual.’’; 

13 and 

14 (3) in paragraph (5), as so designated— 

15 (A) in subparagraph (A)— 

16 (i) by inserting ‘‘for individuals who 

17 are physicians’’ after ‘‘this section’’; and 

18 (ii) by inserting after the period at 

19 the end the following: ‘‘The Secretary shall 

20 determine the amount of an Award under 

21 this section for individuals who are not 

22 physicians.’’; and 

23 (B) by adding at the end the following: 

24 ‘‘(C) PAYMENT TO INSTITUTION.—The 

25 Secretary shall make payments to institutions 


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1 which include schools of medicine, osteopathic 

2 medicine, nursing, social work, psychology, den3 tistry, and pharmacy, or other allied health dis4 cipline in an accredited health professions 

5 school that is approved by the Secretary.’’. 

6 (c) COMPREHENSIVE GERIATRIC EDUCATION.—Sec7 tion 855 of the Public Health Service Act (42 U.S.C. 298) 

8 is amended— 

9 (1) in subsection (b)— 

10 (A) in paragraph (3), by striking ‘‘or’’ at 

11 the end; 

12 (B) in paragraph (4), by striking the pe13 riod and inserting ‘‘; or’’; and 

14 (C) by adding at the end the following: 

15 ‘‘(5) establish traineeships for individuals who 

16 are preparing for advanced education nursing de17 grees in geriatric nursing, long-term care, gero-psy18 chiatric nursing or other nursing areas that spe19 cialize in the care of the elderly population.’’; and 

20 (2) in subsection (e), by striking ‘‘2003 through 

21 2007’’ and inserting ‘‘2010 through 2014’’. 

22 SEC. 5306. MENTAL AND BEHAVIORAL HEALTH EDUCATION 

23 AND TRAINING GRANTS. 

24 (a) IN GENERAL.—Part D of title VII (42 U.S.C. 

25 294 et seq.) is amended by— 


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1 (1) striking section 757; 

2 (2) redesignating section 756 (as amended by 

3 section 5103) as section 757; and 

4 (3) inserting after section 755 the following: 

5 ‘‘SEC. 756. MENTAL AND BEHAVIORAL HEALTH EDUCATION 

6 AND TRAINING GRANTS. 

7 ‘‘(a) GRANTS AUTHORIZED.—The Secretary may 

8 award grants to eligible institutions of higher education 

9 to support the recruitment of students for, and education 

10 and clinical experience of the students in— 

11 ‘‘(1) baccalaureate, master’s, and doctoral de12 gree programs of social work, as well as the develop13 ment of faculty in social work; 

14 ‘‘(2) accredited master’s, doctoral, internship, 

15 and post-doctoral residency programs of psychology 

16 for the development and implementation of inter17 disciplinary training of psychology graduate students 

18 for providing behavioral and mental health services, 

19 including substance abuse prevention and treatment 

20 services; 

21 ‘‘(3) accredited institutions of higher education 

22 or accredited professional training programs that are 

23 establishing or expanding internships or other field 

24 placement programs in child and adolescent mental 

25 health in psychiatry, psychology, school psychology, 


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1 behavioral pediatrics, psychiatric nursing, social 

2 work, school social work, substance abuse prevention 

3 and treatment, marriage and family therapy, school 

4 counseling, or professional counseling; and 

5 ‘‘(4) State-licensed mental health nonprofit and 

6 for-profit organizations to enable such organizations 

7 to pay for programs for preservice or in-service 

8 training of paraprofessional child and adolescent 

9 mental health workers. 

10 ‘‘(b) ELIGIBILITY REQUIREMENTS.—To be eligible 

11 for a grant under this section, an institution shall dem12 onstrate— 

13 ‘‘(1) participation in the institutions’ programs 

14 of individuals and groups from different racial, eth15 nic, cultural, geographic, religious, linguistic, and 

16 class backgrounds, and different genders and sexual 

17 orientations; 

18 ‘‘(2) knowledge and understanding of the con19 cerns of the individuals and groups described in sub20 section (a); 

21 ‘‘(3) any internship or other field placement 

22 program assisted under the grant will prioritize cul23 tural and linguistic competency; 


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1 ‘‘(4) the institution will provide to the Secretary 

2 such data, assurances, and information as the Sec3 retary may require; and 

4 ‘‘(5) with respect to any violation of the agree5 ment between the Secretary and the institution, the 

6 institution will pay such liquidated damages as pre7 scribed by the Secretary by regulation. 

8 ‘‘(c) INSTITUTIONAL REQUIREMENT.—For grants 

9 authorized under subsection (a)(1), at least 4 of the grant 

10 recipients shall be historically black colleges or universities 

11 or other minority-serving institutions. 

12 ‘‘(d) PRIORITY.— 

13 ‘‘(1) In selecting the grant recipients in social 

14 work under subsection (a)(1), the Secretary shall 

15 give priority to applicants that— 

16 ‘‘(A) are accredited by the Council on So17 cial Work Education; 

18 ‘‘(B) have a graduation rate of not less 

19 than 80 percent for social work students; and 

20 ‘‘(C) exhibit an ability to recruit social 

21 workers from and place social workers in areas 

22 with a high need and high demand population. 

23 ‘‘(2) In selecting the grant recipients in grad24 uate psychology under subsection (a)(2), the Sec25 retary shall give priority to institutions in which 


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1 training focuses on the needs of vulnerable groups 

2 such as older adults and children, individuals with 

3 mental health or substance-related disorders, victims 

4 of abuse or trauma and of combat stress disorders 

5 such as posttraumatic stress disorder and traumatic 

6 brain injuries, homeless individuals, chronically ill 

7 persons, and their families. 

8 ‘‘(3) In selecting the grant recipients in train9 ing programs in child and adolescent mental health 

10 under subsections (a)(3) and (a)(4), the Secretary 

11 shall give priority to applicants that— 

12 ‘‘(A) have demonstrated the ability to col13 lect data on the number of students trained in 

14 child and adolescent mental health and the pop15 ulations served by such students after gradua16 tion or completion of preservice or in-service 

17 training; 

18 ‘‘(B) have demonstrated familiarity with 

19 evidence-based methods in child and adolescent 

20 mental health services, including substance 

21 abuse prevention and treatment services; 

22 ‘‘(C) have programs designed to increase 

23 the number of professionals and paraprofes24 sionals serving high-priority populations and to 

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1 nities and plan to serve medically underserved 

2 populations, in health professional shortage 

3 areas, or in medically underserved areas; 

4 ‘‘(D) offer curriculum taught collabo5 ratively with a family on the consumer and 

6 family lived experience or the importance of 

7 family-professional or family-paraprofessional 

8 partnerships; and 

9 ‘‘(E) provide services through a community 

10 mental health program described in section 

11 1913(b)(1). 

12 ‘‘(e) AUTHORIZATION OF APPROPRIATION.—For the 

13 fiscal years 2010 through 2013, there is authorized to be 

14 appropriated to carry out this section— 

15 ‘‘(1) $8,000,000 for training in social work in 

16 subsection (a)(1); 

17 ‘‘(2) $12,000,000 for training in graduate psy18 chology in subsection (a)(2), of which not less than 

19 $10,000,000 shall be allocated for doctoral, 

20 postdoctoral, and internship level training; 

21 ‘‘(3) $10,000,000 for training in professional 

22 child and adolescent mental health in subsection 

23 (a)(3); and 


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1 ‘‘(4) $5,000,000 for training in paraprofes2 sional child and adolescent work in subsection 

3 (a)(4).’’. 

4 (b) CONFORMING AMENDMENTS.—Section 757(b)(2) 

5 of the Public Health Service Act, as redesignated by sub6 section (a), is amended by striking ‘‘sections 751(a)(1)(A), 

7 751(a)(1)(B), 753(b), 754(3)(A), and 755(b)’’ and insert8 ing ‘‘sections 751(b)(1)(A), 753(b), and 755(b)’’. 

9 SEC. 5307. CULTURAL COMPETENCY, PREVENTION, AND 

10 PUBLIC HEALTH AND INDIVIDUALS WITH DIS11 ABILITIES TRAINING. 

12 (a) TITLE VII.—Section 741 of the Public Health 

13 Service Act (42 U.S.C. 293e) is amended— 

14 (1) in subsection (a)— 

15 (A) by striking the subsection heading and 

16 inserting ‘‘CULTURAL COMPETENCY, PREVEN17 TION, AND PUBLIC HEALTH AND INDIVIDUALS

18 WITH DISABILITY GRANTS’’; and 

19 (B) in paragraph (1), by striking ‘‘for the 

20 purpose of’’ and all that follows through the pe21 riod at the end and inserting ‘‘for the develop22 ment, evaluation, and dissemination of research, 

23 demonstration projects, and model curricula for 

24 cultural competency, prevention, public health 

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1 titude for working with individuals with disabil2 ities training for use in health professions 

3 schools and continuing education programs, and 

4 for other purposes determined as appropriate 

5 by the Secretary.’’; and 

6 (2) by striking subsection (b) and inserting the 

7 following: 

8 ‘‘(b) COLLABORATION.—In carrying out subsection 

9 (a), the Secretary shall collaborate with health profes10 sional societies, licensing and accreditation entities, health 

11 professions schools, and experts in minority health and 

12 cultural competency, prevention, and public health and 

13 disability groups, community-based organizations, and 

14 other organizations as determined appropriate by the Sec15 retary. The Secretary shall coordinate with curricula and 

16 research and demonstration projects developed under sec17 tion 807. 

18 ‘‘(c) DISSEMINATION.— 

19 ‘‘(1) IN GENERAL.—Model curricula developed 

20 under this section shall be disseminated through the 

21 Internet Clearinghouse under section 270 and such 

22 other means as determined appropriate by the Sec23 retary. 

24 ‘‘(2) EVALUATION.—The Secretary shall evalu25 ate the adoption and the implementation of cultural 


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1 competency, prevention, and public health, and 

2 working with individuals with a disability training 

3 curricula, and the facilitate inclusion of these com4 petency measures in quality measurement systems as 

5 appropriate. 

6 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

7 is authorized to be appropriated to carry out this section 

8 such sums as may be necessary for each of fiscal years 

9 2010 through 2015.’’. 

10 (b) TITLE VIII.—Section 807 of the Public Health 

11 Service Act (42 U.S.C. 296e–1) is amended— 

12 (1) in subsection (a)— 

13 (A) by striking the subsection heading and 

14 inserting ‘‘CULTURAL COMPETENCY, PREVEN15 TION, AND PUBLIC HEALTH AND INDIVIDUALS

16 WITH DISABILITY GRANTS’’; and 

17 (B) by striking ‘‘for the purpose of’’ and 

18 all that follows through ‘‘health care.’’ and in19 serting ‘‘for the development, evaluation, and 

20 dissemination of research, demonstration 

21 projects, and model curricula for cultural com22 petency, prevention, public health proficiency, 

23 reducing health disparities, and aptitude for 

24 working with individuals with disabilities train25 ing for use in health professions schools and 


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1 continuing education programs, and for other 

2 purposes determined as appropriate by the Sec3 retary.’’; and 

4 (2) by redesignating subsection (b) as sub5 section (d); 

6 (3) by inserting after subsection (a) the fol7 lowing: 

8 ‘‘(b) COLLABORATION.—In carrying out subsection 

9 (a), the Secretary shall collaborate with the entities de10 scribed in section 741(b). The Secretary shall coordinate 

11 with curricula and research and demonstration projects 

12 developed under such section 741. 

13 ‘‘(c) DISSEMINATION.—Model curricula developed 

14 under this section shall be disseminated and evaluated in 

15 the same manner as model curricula developed under sec16 tion 741, as described in subsection (c) of such section.’’; 

17 and 

18 (4) in subsection (d), as so redesignated— 

19 (A) by striking ‘‘subsection (a)’’ and in20 serting ‘‘this section’’; and 

21 (B) by striking ‘‘2001 through 2004’’ and 

22 inserting ‘‘2010 through 2015’’. 

23 SEC. 5308. ADVANCED NURSING EDUCATION GRANTS. 

24 Section 811 of the Public Health Service Act (42 

25 U.S.C. 296j) is amended— 


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1 (1) in subsection (c)— 

2 (A) in the subsection heading, by striking 

3 ‘‘AND NURSE MIDWIFERY PROGRAMS’’; and 

4 (B) by striking ‘‘and nurse midwifery’’; 

5 (2) in subsection (f)— 

6 (A) by striking paragraph (2); and 

7 (B) by redesignating paragraph (3) as 

8 paragraph (2); and 

9 (3) by redesignating subsections (d), (e), and 

10 (f) as subsections (e), (f), and (g), respectively; and 

11 (4) by inserting after subsection (c), the fol12 lowing: 

13 ‘‘(d) AUTHORIZED NURSE-MIDWIFERY PROGRAMS.— 

14 Midwifery programs that are eligible for support under 

15 this section are educational programs that— 

16 ‘‘(1) have as their objective the education of 

17 midwives; and 

18 ‘‘(2) are accredited by the American College of 

19 Nurse-Midwives Accreditation Commission for Mid20 wifery Education.’’. 

21 SEC. 5309. NURSE EDUCATION, PRACTICE, AND RETENTION 

22 GRANTS. 

23 (a) IN GENERAL.—Section 831 of the Public Health 

24 Service Act (42 U.S.C. 296p) is amended— 


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1 (1) in the section heading, by striking ‘‘RETEN2 TION’’ and inserting ‘‘QUALITY’’; 

3 (2) in subsection (a)— 

4 (A) in paragraph (1), by adding ‘‘or’’ after 

5 the semicolon; 

6 (B) by striking paragraph (2); and 

7 (C) by redesignating paragraph (3) as 

8 paragraph (2); 

9 (3) in subsection (b)(3), by striking ‘‘managed 

10 care, quality improvement’’ and inserting ‘‘coordi11 nated care’’; 

12 (4) in subsection (g), by inserting ‘‘, as defined 

13 in section 801(2),’’ after ‘‘school of nursing’’; and 

14 (5) in subsection (h), by striking ‘‘2003 

15 through 2007’’ and inserting ‘‘2010 through 2014’’. 

16 (b) NURSE RETENTION GRANTS.—Title VIII of the 

17 Public Health Service Act is amended by inserting after 

18 section 831 (42 U.S.C. 296b) the following: 

19 ‘‘SEC. 831A. NURSE RETENTION GRANTS. 

20 ‘‘(a) RETENTION PRIORITY AREAS.—The Secretary 

21 may award grants to, and enter into contracts with, eligi22 ble entities to enhance the nursing workforce by initiating 

23 and maintaining nurse retention programs pursuant to 

24 subsection (b) or (c). 


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1 ‘‘(b) GRANTS FOR CAREER LADDER PROGRAM.—The 

2 Secretary may award grants to, and enter into contracts 

3 with, eligible entities for programs— 

4 ‘‘(1) to promote career advancement for individ5 uals including licensed practical nurses, licensed vo6 cational nurses, certified nurse assistants, home 

7 health aides, diploma degree or associate degree 

8 nurses, to become baccalaureate prepared registered 

9 nurses or advanced education nurses in order to 

10 meet the needs of the registered nurse workforce; 

11 ‘‘(2) developing and implementing internships 

12 and residency programs in collaboration with an ac13 credited school of nursing, as defined by section 

14 801(2), to encourage mentoring and the development 

15 of specialties; or 

16 ‘‘(3) to assist individuals in obtaining education 

17 and training required to enter the nursing profession 

18 and advance within such profession. 

19 ‘‘(c) ENHANCING PATIENT CARE DELIVERY SYS20 TEMS.— 

21 ‘‘(1) GRANTS.—The Secretary may award 

22 grants to eligible entities to improve the retention of 

23 nurses and enhance patient care that is directly re24 lated to nursing activities by enhancing collaboration 

25 and communication among nurses and other health 


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1 care professionals, and by promoting nurse involve2 ment in the organizational and clinical decision-mak3 ing processes of a health care facility. 

4 ‘‘(2) PRIORITY.—In making awards of grants 

5 under this subsection, the Secretary shall give pref6 erence to applicants that have not previously re7 ceived an award under this subsection (or section 

8 831(c) as such section existed on the day before the 

9 date of enactment of this section). 

10 ‘‘(3) CONTINUATION OF AN AWARD.—The Sec11 retary shall make continuation of any award under 

12 this subsection beyond the second year of such 

13 award contingent on the recipient of such award 

14 having demonstrated to the Secretary measurable 

15 and substantive improvement in nurse retention or 

16 patient care. 

17 ‘‘(d) OTHER PRIORITY AREAS.—The Secretary may 

18 award grants to, or enter into contracts with, eligible enti19 ties to address other areas that are of high priority to 

20 nurse retention, as determined by the Secretary. 

21 ‘‘(e) REPORT.—The Secretary shall submit to the 

22 Congress before the end of each fiscal year a report on 

23 the grants awarded and the contracts entered into under 

24 this section. Each such report shall identify the overall 

25 number of such grants and contracts and provide an exVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01381 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 planation of why each such grant or contract will meet 

2 the priority need of the nursing workforce. 

3 ‘‘(f) ELIGIBLE ENTITY.—For purposes of this sec4 tion, the term ‘eligible entity’ includes an accredited school 

5 of nursing, as defined by section 801(2), a health care fa6 cility, or a partnership of such a school and facility. 

7 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

8 are authorized to be appropriated to carry out this section 

9 such sums as may be necessary for each of fiscal years 

10 2010 through 2012.’’. 

11 SEC. 5310. LOAN REPAYMENT AND SCHOLARSHIP PRO12 GRAM. 

13 (a) LOAN REPAYMENTS AND SCHOLARSHIPS.—Sec14 tion 846(a)(3) of the Public Health Service Act (42 U.S.C. 

15 297n(a)(3)) is amended by inserting before the semicolon 

16 the following: ‘‘, or in a accredited school of nursing, as 

17 defined by section 801(2), as nurse faculty’’. 

18 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 

19 Title VIII (42 U.S.C. 296 et seq.) is amended— 

20 (1) by redesignating section 810 (relating to 

21 prohibition against discrimination by schools on the 

22 basis of sex) as section 809 and moving such section 

23 so that it follows section 808; 


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1 (2) in sections 835, 836, 838, 840, and 842, by 

2 striking the term ‘‘this subpart’’ each place it ap3 pears and inserting ‘‘this part’’; 

4 (3) in section 836(h), by striking the last sen5 tence; 

6 (4) in section 836, by redesignating subsection 

7 (l) as subsection (k); 

8 (5) in section 839, by striking ‘‘839’’ and all 

9 that follows through ‘‘(a)’’ and inserting ‘‘839. (a)’’; 

10 (6) in section 835(b), by striking ‘‘841’’ each 

11 place it appears and inserting ‘‘871’’; 

12 (7) by redesignating section 841 as section 871, 

13 moving part F to the end of the title, and redesig14 nating such part as part I; 

15 (8) in part G— 

16 (A) by redesignating section 845 as section 

17 851; and 

18 (B) by redesignating part G as part F; 

19 (9) in part H— 

20 (A) by redesignating sections 851 and 852 

21 as sections 861 and 862, respectively; and 

22 (B) by redesignating part H as part G; 

23 and 

24 (10) in part I— 


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1 (A) by redesignating section 855, as 

2 amended by section 5305, as section 865; and 

3 (B) by redesignating part I as part H. 

4 SEC. 5311. NURSE FACULTY LOAN PROGRAM. 

5 (a) IN GENERAL.—Section 846A of the Public 

6 Health Service Act (42 U.S.C. 297n–1) is amended— 

7 (1) in subsection (a)— 

8 (A) in the subsection heading, by striking 

9 ‘‘ESTABLISHMENT’’ and inserting ‘‘SCHOOL OF

10 NURSING STUDENT LOAN FUND’’; and 

11 (B) by inserting ‘‘accredited’’ after ‘‘agree12 ment with any’’; 

13 (2) in subsection (c)— 

14 (A) in paragraph (2), by striking 

15 ‘‘$30,000’’ and all that follows through the 

16 semicolon and inserting ‘‘$35,500, during fiscal 

17 years 2010 and 2011 fiscal years (after fiscal 

18 year 2011, such amounts shall be adjusted to 

19 provide for a cost-of-attendance increase for the 

20 yearly loan rate and the aggregate loan;’’; and 

21 (B) in paragraph (3)(A), by inserting ‘‘an 

22 accredited’’ after ‘‘faculty member in’’; 

23 (3) in subsection (e), by striking ‘‘a school’’ and 

24 inserting ‘‘an accredited school’’; and 


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1 (4) in subsection (f), by striking ‘‘2003 through 

2 2007’’ and inserting ‘‘2010 through 2014’’. 

3 (b) ELIGIBLE INDIVIDUAL STUDENT LOAN REPAY4 MENT.—Title VIII of the Public Health Service Act is 

5 amended by inserting after section 846A (42 U.S.C. 

6 297n–1) the following: 

7 ‘‘SEC. 847. ELIGIBLE INDIVIDUAL STUDENT LOAN REPAY8 MENT. 

9 ‘‘(a) IN GENERAL.—The Secretary, acting through 

10 the Administrator of the Health Resources and Services 

11 Administration, may enter into an agreement with eligible 

12 individuals for the repayment of education loans, in ac13 cordance with this section, to increase the number of 

14 qualified nursing faculty. 

15 ‘‘(b) AGREEMENTS.—Each agreement entered into 

16 under this subsection shall require that the eligible indi17 vidual shall serve as a full-time member of the faculty of 

18 an accredited school of nursing, for a total period, in the 

19 aggregate, of at least 4 years during the 6-year period be20 ginning on the later of— 

21 ‘‘(1) the date on which the individual receives 

22 a master’s or doctorate nursing degree from an ac23 credited school of nursing; or 

24 ‘‘(2) the date on which the individual enters 

25 into an agreement under this subsection. 


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1 ‘‘(c) AGREEMENT PROVISIONS.—Agreements entered 

2 into pursuant to subsection (b) shall be entered into on 

3 such terms and conditions as the Secretary may deter4 mine, except that— 

5 ‘‘(1) not more than 10 months after the date on 

6 which the 6-year period described under subsection 

7 (b) begins, but in no case before the individual 

8 starts as a full-time member of the faculty of an ac9 credited school of nursing the Secretary shall begin 

10 making payments, for and on behalf of that indi11 vidual, on the outstanding principal of, and interest 

12 on, any loan of that individual obtained to pay for 

13 such degree; 

14 ‘‘(2) for an individual who has completed a 

15 master’s in nursing or equivalent degree in nurs16 ing— 

17 ‘‘(A) payments may not exceed $10,000 

18 per calendar year; and 

19 ‘‘(B) total payments may not exceed 

20 $40,000 during the 2010 and 2011 fiscal years 

21 (after fiscal year 2011, such amounts shall be 

22 adjusted to provide for a cost-of-attendance in23 crease for the yearly loan rate and the aggre24 gate loan); and 


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1 ‘‘(3) for an individual who has completed a doc2 torate or equivalent degree in nursing— 

3 ‘‘(A) payments may not exceed $20,000 

4 per calendar year; and 

5 ‘‘(B) total payments may not exceed 

6 $80,000 during the 2010 and 2011 fiscal years 

7 (adjusted for subsequent fiscal years as pro8 vided for in the same manner as in paragraph 

9 (2)(B)). 

10 ‘‘(d) BREACH OF AGREEMENT.— 

11 ‘‘(1) IN GENERAL.—In the case of any agree12 ment made under subsection (b), the individual is 

13 liable to the Federal Government for the total 

14 amount paid by the Secretary under such agree15 ment, and for interest on such amount at the max16 imum legal prevailing rate, if the individual fails to 

17 meet the agreement terms required under such sub18 section. 

19 ‘‘(2) WAIVER OR SUSPENSION OF LIABILITY.— 

20 In the case of an individual making an agreement 

21 for purposes of paragraph (1), the Secretary shall 

22 provide for the waiver or suspension of liability 

23 under such paragraph if compliance by the indi24 vidual with the agreement involved is impossible or 

25 would involve extreme hardship to the individual or 


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1 if enforcement of the agreement with respect to the 

2 individual would be unconscionable. 

3 ‘‘(3) DATE CERTAIN FOR RECOVERY.—Subject 

4 to paragraph (2), any amount that the Federal Gov5 ernment is entitled to recover under paragraph (1) 

6 shall be paid to the United States not later than the 

7 expiration of the 3-year period beginning on the date 

8 the United States becomes so entitled. 

9 ‘‘(4) AVAILABILITY.—Amounts recovered under 

10 paragraph (1) shall be available to the Secretary for 

11 making loan repayments under this section and shall 

12 remain available for such purpose until expended. 

13 ‘‘(e) ELIGIBLE INDIVIDUAL DEFINED.—For pur14 poses of this section, the term ‘eligible individual’ means 

15 an individual who— 

16 ‘‘(1) is a United States citizen, national, or law17 ful permanent resident; 

18 ‘‘(2) holds an unencumbered license as a reg19 istered nurse; and 

20 ‘‘(3) has either already completed a master’s or 

21 doctorate nursing program at an accredited school of 

22 nursing or is currently enrolled on a full-time or 

23 part-time basis in such a program. 

24 ‘‘(f) PRIORITY.—For the purposes of this section and 

25 section 846A, funding priority will be awarded to School 


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1 of Nursing Student Loans that support doctoral nursing 

2 students or Individual Student Loan Repayment that sup3 port doctoral nursing students. 

4 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated to carry out this section 

6 such sums as may be necessary for each of fiscal years 

7 2010 through 2014.’’. 

8 SEC. 5312. AUTHORIZATION OF APPROPRIATIONS FOR 

9 PARTS B THROUGH D OF TITLE VIII. 

10 Section 871 of the Public Health Service Act, as re11 designated and moved by section 5310, is amended to read 

12 as follows: 

13 ‘‘SEC. 871. AUTHORIZATION OF APPROPRIATIONS. 

14 ‘‘For the purpose of carrying out parts B, C, and D 

15 (subject to section 851(g)), there are authorized to be ap16 propriated $338,000,000 for fiscal year 2010, and such 

17 sums as may be necessary for each of the fiscal years 2011 

18 through 2016.’’. 

19 SEC. 5313. GRANTS TO PROMOTE THE COMMUNITY HEALTH 

20 WORKFORCE. 

21 (a) IN GENERAL.—Part P of title III of the Public 

22 Health Service Act (42 U.S.C. 280g et seq.) is amended 

23 by adding at the end the following: 


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1 ‘‘SEC. 399V. GRANTS TO PROMOTE POSITIVE HEALTH BE2 HAVIORS AND OUTCOMES. 

3 ‘‘(a) GRANTS AUTHORIZED.—The Director of the 

4 Centers for Disease Control and Prevention, in collabora5 tion with the Secretary, shall award grants to eligible enti6 ties to promote positive health behaviors and outcomes for 

7 populations in medically underserved communities through 

8 the use of community health workers. 

9 ‘‘(b) USE OF FUNDS.—Grants awarded under sub10 section (a) shall be used to support community health 

11 workers— 

12 ‘‘(1) to educate, guide, and provide outreach in 

13 a community setting regarding health problems prev14 alent in medically underserved communities, particu15 larly racial and ethnic minority populations; 

16 ‘‘(2) to educate and provide guidance regarding 

17 effective strategies to promote positive health behav18 iors and discourage risky health behaviors; 

19 ‘‘(3) to educate and provide outreach regarding 

20 enrollment in health insurance including the Chil21 dren’s Health Insurance Program under title XXI of 

22 the Social Security Act, Medicare under title XVIII 

23 of such Act and Medicaid under title XIX of such 

24 Act; 

25 ‘‘(4) to identify, educate, refer, and enroll un26 derserved populations to appropriate healthcare 


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1 agencies and community-based programs and organi2 zations in order to increase access to quality 

3 healthcare services and to eliminate duplicative care; 

4 or 

5 ‘‘(5) to educate, guide, and provide home visita6 tion services regarding maternal health and prenatal 

7 care. 

8 ‘‘(c) APPLICATION.—Each eligible entity that desires 

9 to receive a grant under subsection (a) shall submit an 

10 application to the Secretary, at such time, in such manner, 

11 and accompanied by such information as the Secretary 

12 may require. 

13 ‘‘(d) PRIORITY.—In awarding grants under sub14 section (a), the Secretary shall give priority to applicants 

15 that— 

16 ‘‘(1) propose to target geographic areas— 

17 ‘‘(A) with a high percentage of residents 

18 who are eligible for health insurance but are 

19 uninsured or underinsured; 

20 ‘‘(B) with a high percentage of residents 

21 who suffer from chronic diseases; or 

22 ‘‘(C) with a high infant mortality rate; 

23 ‘‘(2) have experience in providing health or 

24 health-related social services to individuals who are 

25 underserved with respect to such services; and 


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1 ‘‘(3) have documented community activity and 

2 experience with community health workers. 

3 ‘‘(e) COLLABORATION WITH ACADEMIC INSTITU4 TIONS AND THE ONE-STOP DELIVERY SYSTEM.—The Sec5 retary shall encourage community health worker programs 

6 receiving funds under this section to collaborate with aca7 demic institutions and one-stop delivery systems under 

8 section 134(c) of the Workforce Investment Act of 1998. 

9 Nothing in this section shall be construed to require such 

10 collaboration. 

11 ‘‘(f) EVIDENCE-BASED INTERVENTIONS.—The Sec12 retary shall encourage community health worker programs 

13 receiving funding under this section to implement a proc14 ess or an outcome-based payment system that rewards 

15 community health workers for connecting underserved 

16 populations with the most appropriate services at the most 

17 appropriate time. Nothing in this section shall be con18 strued to require such a payment. 

19 ‘‘(g) QUALITY ASSURANCE AND COST EFFECTIVE20 NESS.—The Secretary shall establish guidelines for assur21 ing the quality of the training and supervision of commu22 nity health workers under the programs funded under this 

23 section and for assuring the cost-effectiveness of such pro24 grams. 


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1 ‘‘(h) MONITORING.—The Secretary shall monitor 

2 community health worker programs identified in approved 

3 applications under this section and shall determine wheth4 er such programs are in compliance with the guidelines 

5 established under subsection (g). 

6 ‘‘(i) TECHNICAL ASSISTANCE.—The Secretary may 

7 provide technical assistance to community health worker 

8 programs identified in approved applications under this 

9 section with respect to planning, developing, and operating 

10 programs under the grant. 

11 ‘‘(j) AUTHORIZATION OF APPROPRIATIONS.—There 

12 are authorized to be appropriated, such sums as may be 

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

14 2010 through 2014. 

15 ‘‘(k) DEFINITIONS.—In this section: 

16 ‘‘(1) COMMUNITY HEALTH WORKER.—The term 

17 ‘community health worker’, as defined by the De18 partment of Labor as Standard Occupational Classi19 fication [21–1094] means an individual who pro20 motes health or nutrition within the community in 

21 which the individual resides— 

22 ‘‘(A) by serving as a liaison between com23 munities and healthcare agencies; 

24 ‘‘(B) by providing guidance and social as25 sistance to community residents; 


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1 ‘‘(C) by enhancing community residents’ 

2 ability to effectively communicate with 

3 healthcare providers; 

4 ‘‘(D) by providing culturally and linguis5 tically appropriate health or nutrition edu6 cation; 

7 ‘‘(E) by advocating for individual and com8 munity health; 

9 ‘‘(F) by providing referral and follow-up 

10 services or otherwise coordinating care; and 

11 ‘‘(G) by proactively identifying and enroll12 ing eligible individuals in Federal, State, local, 

13 private or nonprofit health and human services 

14 programs. 

15 ‘‘(2) COMMUNITY SETTING.—The term ‘commu16 nity setting’ means a home or a community organi17 zation located in the neighborhood in which a partic18 ipant in the program under this section resides. 

19 ‘‘(3) ELIGIBLE ENTITY.—The term ‘eligible en20 tity’ means a public or nonprofit private entity (in21 cluding a State or public subdivision of a State, a 

22 public health department, a free health clinic, a hos23 pital, or a Federally-qualified health center (as de24 fined in section 1861(aa) of the Social Security 

25 Act)), or a consortium of any such entities. 


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1 ‘‘(4) MEDICALLY UNDERSERVED COMMUNITY.— 

2 The term ‘medically underserved community’ means 

3 a community identified by a State— 

4 ‘‘(A) that has a substantial number of in5 dividuals who are members of a medically un6 derserved population, as defined by section 

7 330(b)(3); and 

8 ‘‘(B) a significant portion of which is a 

9 health professional shortage area as designated 

10 under section 332.’’. 

11 SEC. 5314. FELLOWSHIP TRAINING IN PUBLIC HEALTH. 

12 Part E of title VII of the Public Health Service Act 

13 (42 U.S.C. 294n et seq.), as amended by section 5206, 

14 is further amended by adding at the end the following: 

15 ‘‘SEC. 778. FELLOWSHIP TRAINING IN APPLIED PUBLIC 

16 HEALTH EPIDEMIOLOGY, PUBLIC HEALTH 

17 LABORATORY SCIENCE, PUBLIC HEALTH 

18 INFORMATICS, AND EXPANSION OF THE EPI19 DEMIC INTELLIGENCE SERVICE. 

20 ‘‘(a) IN GENERAL.—The Secretary may carry out ac21 tivities to address documented workforce shortages in 

22 State and local health departments in the critical areas 

23 of applied public health epidemiology and public health 

24 laboratory science and informatics and may expand the 

25 Epidemic Intelligence Service. 


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1 ‘‘(b) SPECIFIC USES.—In carrying out subsection 

2 (a), the Secretary shall provide for the expansion of exist3 ing fellowship programs operated through the Centers for 

4 Disease Control and Prevention in a manner that is de5 signed to alleviate shortages of the type described in sub6 section (a). 

7 ‘‘(c) OTHER PROGRAMS.—The Secretary may provide 

8 for the expansion of other applied epidemiology training 

9 programs that meet objectives similar to the objectives of 

10 the programs described in subsection (b). 

11 ‘‘(d) WORK OBLIGATION.—Participation in fellow12 ship training programs under this section shall be deemed 

13 to be service for purposes of satisfying work obligations 

14 stipulated in contracts under section 338I(j). 

15 ‘‘(e) GENERAL SUPPORT.—Amounts may be used 

16 from grants awarded under this section to expand the 

17 Public Health Informatics Fellowship Program at the 

18 Centers for Disease Control and Prevention to better sup19 port all public health systems at all levels of government. 

20 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

21 are authorized to be appropriated to carry out this section 

22 $39,500,000 for each of fiscal years 2010 through 2013, 

23 of which— 


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1 ‘‘(1) $5,000,000 shall be made available in each 

2 such fiscal year for epidemiology fellowship training 

3 program activities under subsections (b) and (c); 

4 ‘‘(2) $5,000,000 shall be made available in each 

5 such fiscal year for laboratory fellowship training 

6 programs under subsection (b); 

7 ‘‘(3) $5,000,000 shall be made available in each 

8 such fiscal year for the Public Health Informatics 

9 Fellowship Program under subsection (e); and 

10 ‘‘(4) $24,500,000 shall be made available for 

11 expanding the Epidemic Intelligence Service under 

12 subsection (a).’’. 

13 SEC. 5315. UNITED STATES PUBLIC HEALTH SCIENCES 

14 TRACK. 

15 Title II of the Public Health Service Act (42 U.S.C. 

16 202 et seq.) is amended by adding at the end the fol17 lowing: 

18 ‘‘PART D—UNITED STATES PUBLIC HEALTH 

19 SCIENCES TRACK 

20 ‘‘SEC. 271. ESTABLISHMENT. 

21 ‘‘(a) UNITED STATES PUBLIC HEALTH SERVICES

22 TRACK.— 

23 ‘‘(1) IN GENERAL.—There is hereby authorized 

24 to be established a United States Public Health 

25 Sciences Track (referred to in this part as the 


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1 ‘Track’), at sites to be selected by the Secretary, 

2 with authority to grant appropriate advanced de3 grees in a manner that uniquely emphasizes team4 based service, public health, epidemiology, and emer5 gency preparedness and response. It shall be so or6 ganized as to graduate not less than— 

7 ‘‘(A) 150 medical students annually, 10 of 

8 whom shall be awarded studentships to the Uni9 formed Services University of Health Sciences; 

10 ‘‘(B) 100 dental students annually; 

11 ‘‘(C) 250 nursing students annually; 

12 ‘‘(D) 100 public health students annually; 

13 ‘‘(E) 100 behavioral and mental health 

14 professional students annually; 

15 ‘‘(F) 100 physician assistant or nurse 

16 practitioner students annually; and 

17 ‘‘(G) 50 pharmacy students annually. 

18 ‘‘(2) LOCATIONS.—The Track shall be located 

19 at existing and accredited, affiliated health profes20 sions education training programs at academic 

21 health centers located in regions of the United 

22 States determined appropriate by the Surgeon Gen23 eral, in consultation with the National Health Care 

24 Workforce Commission established in section 5101 

25 of the Patient Protection and Affordable Care Act. 


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1 ‘‘(b) NUMBER OF GRADUATES.—Except as provided 

2 in subsection (a), the number of persons to be graduated 

3 from the Track shall be prescribed by the Secretary. In 

4 so prescribing the number of persons to be graduated from 

5 the Track, the Secretary shall institute actions necessary 

6 to ensure the maximum number of first-year enrollments 

7 in the Track consistent with the academic capacity of the 

8 affiliated sites and the needs of the United States for med9 ical, dental, and nursing personnel. 

10 ‘‘(c) DEVELOPMENT.—The development of the Track 

11 may be by such phases as the Secretary may prescribe 

12 subject to the requirements of subsection (a). 

13 ‘‘(d) INTEGRATED LONGITUDINAL PLAN.—The Sur14 geon General shall develop an integrated longitudinal plan 

15 for health professions continuing education throughout the 

16 continuum of health-related education, training, and prac17 tice. Training under such plan shall emphasize patient18 centered, interdisciplinary, and care coordination skills. 

19 Experience with deployment of emergency response teams 

20 shall be included during the clinical experiences. 

21 ‘‘(e) FACULTY DEVELOPMENT.—The Surgeon Gen22 eral shall develop faculty development programs and cur23 ricula in decentralized venues of health care, to balance 

24 urban, tertiary, and inpatient venues. 


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1 ‘‘SEC. 272. ADMINISTRATION. 

2 ‘‘(a) IN GENERAL.—The business of the Track shall 

3 be conducted by the Surgeon General with funds appro4 priated for and provided by the Department of Health and 

5 Human Services. The National Health Care Workforce 

6 Commission shall assist the Surgeon General in an advi7 sory capacity. 

8 ‘‘(b) FACULTY.— 

9 ‘‘(1) IN GENERAL.—The Surgeon General, after 

10 considering the recommendations of the National 

11 Health Care Workforce Commission, shall obtain the 

12 services of such professors, instructors, and adminis13 trative and other employees as may be necessary to 

14 operate the Track, but utilize when possible, existing 

15 affiliated health professions training institutions. 

16 Members of the faculty and staff shall be employed 

17 under salary schedules and granted retirement and 

18 other related benefits prescribed by the Secretary so 

19 as to place the employees of the Track faculty on a 

20 comparable basis with the employees of fully accred21 ited schools of the health professions within the 

22 United States. 

23 ‘‘(2) TITLES.—The Surgeon General may con24 fer academic titles, as appropriate, upon the mem25 bers of the faculty. 


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1 ‘‘(3) NONAPPLICATION OF PROVISIONS.—The 

2 limitations in section 5373 of title 5, United States 

3 Code, shall not apply to the authority of the Surgeon 

4 General under paragraph (1) to prescribe salary 

5 schedules and other related benefits. 

6 ‘‘(c) AGREEMENTS.—The Surgeon General may ne7 gotiate agreements with agencies of the Federal Govern8 ment to utilize on a reimbursable basis appropriate exist9 ing Federal medical resources located in the United States 

10 (or locations selected in accordance with section 

11 271(a)(2)). Under such agreements the facilities con12 cerned will retain their identities and basic missions. The 

13 Surgeon General may negotiate affiliation agreements 

14 with accredited universities and health professions train15 ing institutions in the United States. Such agreements 

16 may include provisions for payments for educational serv17 ices provided students participating in Department of 

18 Health and Human Services educational programs. 

19 ‘‘(d) PROGRAMS.—The Surgeon General may estab20 lish the following educational programs for Track stu21 dents: 

22 ‘‘(1) Postdoctoral, postgraduate, and techno23 logical programs. 


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1 ‘‘(2) A cooperative program for medical, dental, 

2 physician assistant, pharmacy, behavioral and men3 tal health, public health, and nursing students. 

4 ‘‘(3) Other programs that the Surgeon General 

5 determines necessary in order to operate the Track 

6 in a cost-effective manner. 

7 ‘‘(e) CONTINUING MEDICAL EDUCATION.—The Sur8 geon General shall establish programs in continuing med9 ical education for members of the health professions to 

10 the end that high standards of health care may be main11 tained within the United States. 

12 ‘‘(f) AUTHORITY OF THE SURGEON GENERAL.— 

13 ‘‘(1) IN GENERAL.—The Surgeon General is au14 thorized— 

15 ‘‘(A) to enter into contracts with, accept 

16 grants from, and make grants to any nonprofit 

17 entity for the purpose of carrying out coopera18 tive enterprises in medical, dental, physician as19 sistant, pharmacy, behavioral and mental 

20 health, public health, and nursing research, 

21 consultation, and education; 

22 ‘‘(B) to enter into contracts with entities 

23 under which the Surgeon General may furnish 

24 the services of such professional, technical, or 

25 clerical personnel as may be necessary to fulfill 


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1 cooperative enterprises undertaken by the 

2 Track; 

3 ‘‘(C) to accept, hold, administer, invest, 

4 and spend any gift, devise, or bequest of per5 sonal property made to the Track, including 

6 any gift, devise, or bequest for the support of 

7 an academic chair, teaching, research, or dem8 onstration project; 

9 ‘‘(D) to enter into agreements with entities 

10 that may be utilized by the Track for the pur11 pose of enhancing the activities of the Track in 

12 education, research, and technological applica13 tions of knowledge; and 

14 ‘‘(E) to accept the voluntary services of 

15 guest scholars and other persons. 

16 ‘‘(2) LIMITATION.—The Surgeon General may 

17 not enter into any contract with an entity if the con18 tract would obligate the Track to make outlays in 

19 advance of the enactment of budget authority for 

20 such outlays. 

21 ‘‘(3) SCIENTISTS.—Scientists or other medical, 

22 dental, or nursing personnel utilized by the Track 

23 under an agreement described in paragraph (1) may 

24 be appointed to any position within the Track and 


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1 may be permitted to perform such duties within the 

2 Track as the Surgeon General may approve. 

3 ‘‘(4) VOLUNTEER SERVICES.—A person who 

4 provides voluntary services under the authority of 

5 subparagraph (E) of paragraph (1) shall be consid6 ered to be an employee of the Federal Government 

7 for the purposes of chapter 81 of title 5, relating to 

8 compensation for work-related injuries, and to be an 

9 employee of the Federal Government for the pur10 poses of chapter 171 of title 28, relating to tort 

11 claims. Such a person who is not otherwise employed 

12 by the Federal Government shall not be considered 

13 to be a Federal employee for any other purpose by 

14 reason of the provision of such services. 

15 ‘‘SEC. 273. STUDENTS; SELECTION; OBLIGATION. 

16 ‘‘(a) STUDENT SELECTION.— 

17 ‘‘(1) IN GENERAL.—Medical, dental, physician 

18 assistant, pharmacy, behavioral and mental health, 

19 public health, and nursing students at the Track 

20 shall be selected under procedures prescribed by the 

21 Surgeon General. In so prescribing, the Surgeon 

22 General shall consider the recommendations of the 

23 National Health Care Workforce Commission. 

24 ‘‘(2) PRIORITY.—In developing admissions pro25 cedures under paragraph (1), the Surgeon General 


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1 shall ensure that such procedures give priority to ap2 plicant medical, dental, physician assistant, phar3 macy, behavioral and mental health, public health, 

4 and nursing students from rural communities and 

5 underrepresented minorities. 

6 ‘‘(b) CONTRACT AND SERVICE OBLIGATION.— 

7 ‘‘(1) CONTRACT.—Upon being admitted to the 

8 Track, a medical, dental, physician assistant, phar9 macy, behavioral and mental health, public health, 

10 or nursing student shall enter into a written con11 tract with the Surgeon General that shall contain— 

12 ‘‘(A) an agreement under which— 

13 ‘‘(i) subject to subparagraph (B), the 

14 Surgeon General agrees to provide the stu15 dent with tuition (or tuition remission) and 

16 a student stipend (described in paragraph 

17 (2)) in each school year for a period of 

18 years (not to exceed 4 school years) deter19 mined by the student, during which period 

20 the student is enrolled in the Track at an 

21 affiliated or other participating health pro22 fessions institution pursuant to an agree23 ment between the Track and such institu24 tion; and 


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1 ‘‘(ii) subject to subparagraph (B), the 

2 student agrees— 

3 ‘‘(I) to accept the provision of 

4 such tuition and student stipend to 

5 the student; 

6 ‘‘(II) to maintain enrollment at 

7 the Track until the student completes 

8 the course of study involved; 

9 ‘‘(III) while enrolled in such 

10 course of study, to maintain an ac11 ceptable level of academic standing 

12 (as determined by the Surgeon Gen13 eral); 

14 ‘‘(IV) if pursuing a degree from 

15 a school of medicine or osteopathic 

16 medicine, dental, public health, or 

17 nursing school or a physician assist18 ant, pharmacy, or behavioral and 

19 mental health professional program, 

20 to complete a residency or internship 

21 in a specialty that the Surgeon Gen22 eral determines is appropriate; and 

23 ‘‘(V) to serve for a period of time 

24 (referred to in this part as the ‘period 

25 of obligated service’) within the ComVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01406 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 missioned Corps of the Public Health 

2 Service equal to 2 years for each 

3 school year during which such indi4 vidual was enrolled at the College, re5 duced as provided for in paragraph 

6 (3); 

7 ‘‘(B) a provision that any financial obliga8 tion of the United States arising out of a con9 tract entered into under this part and any obli10 gation of the student which is conditioned 

11 thereon, is contingent upon funds being appro12 priated to carry out this part; 

13 ‘‘(C) a statement of the damages to which 

14 the United States is entitled for the student’s 

15 breach of the contract; and 

16 ‘‘(D) such other statements of the rights 

17 and liabilities of the Secretary and of the indi18 vidual, not inconsistent with the provisions of 

19 this part. 

20 ‘‘(2) TUITION AND STUDENT STIPEND.— 

21 ‘‘(A) TUITION REMISSION RATES.—The 

22 Surgeon General, based on the recommenda23 tions of the National Health Care Workforce 

24 Commission, shall establish Federal tuition re25 mission rates to be used by the Track to proVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01407 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 vide reimbursement to affiliated and other par2 ticipating health professions institutions for the 

3 cost of educational services provided by such in4 stitutions to Track students. The agreement en5 tered into by such participating institutions 

6 under paragraph (1)(A)(i) shall contain an 

7 agreement to accept as payment in full the es8 tablished remission rate under this subpara9 graph. 

10 ‘‘(B) STIPEND.—The Surgeon General, 

11 based on the recommendations of the National 

12 Health Care Workforce Commission, shall es13 tablish and update Federal stipend rates for 

14 payment to students under this part. 

15 ‘‘(3) REDUCTIONS IN THE PERIOD OF OBLI16 GATED SERVICE.—The period of obligated service 

17 under paragraph (1)(A)(ii)(V) shall be reduced— 

18 ‘‘(A) in the case of a student who elects to 

19 participate in a high-needs speciality residency 

20 (as determined by the National Health Care 

21 Workforce Commission), by 3 months for each 

22 year of such participation (not to exceed a total 

23 of 12 months); and 

24 ‘‘(B) in the case of a student who, upon 

25 completion of their residency, elects to practice 


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1 in a Federal medical facility (as defined in sec2 tion 781(e)) that is located in a health profes3 sional shortage area (as defined in section 332), 

4 by 3 months for year of full-time practice in 

5 such a facility (not to exceed a total of 12 

6 months). 

7 ‘‘(c) SECOND 2 YEARS OF SERVICE.—During the 

8 third and fourth years in which a medical, dental, physi9 cian assistant, pharmacy, behavioral and mental health, 

10 public health, or nursing student is enrolled in the Track, 

11 training should be designed to prioritize clinical rotations 

12 in Federal medical facilities in health professional short13 age areas, and emphasize a balance of hospital and com14 munity-based experiences, and training within inter15 disciplinary teams. 

16 ‘‘(d) DENTIST, PHYSICIAN ASSISTANT, PHARMACIST, 

17 BEHAVIORAL AND MENTAL HEALTH PROFESSIONAL, 

18 PUBLIC HEALTH PROFESSIONAL, AND NURSE TRAIN19 ING.—The Surgeon General shall establish provisions ap20 plicable with respect to dental, physician assistant, phar21 macy, behavioral and mental health, public health, and 

22 nursing students that are comparable to those for medical 

23 students under this section, including service obligations, 

24 tuition support, and stipend support. The Surgeon Gen25 eral shall give priority to health professions training instiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01409 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tutions that train medical, dental, physician assistant, 

2 pharmacy, behavioral and mental health, public health, 

3 and nursing students for some significant period of time 

4 together, but at a minimum have a discrete and shared 

5 core curriculum. 

6 ‘‘(e) ELITE FEDERAL DISASTER TEAMS.—The Sur7 geon General, in consultation with the Secretary, the Di8 rector of the Centers for Disease Control and Prevention, 

9 and other appropriate military and Federal government 

10 agencies, shall develop criteria for the appointment of 

11 highly qualified Track faculty, medical, dental, physician 

12 assistant, pharmacy, behavioral and mental health, public 

13 health, and nursing students, and graduates to elite Fed14 eral disaster preparedness teams to train and to respond 

15 to public health emergencies, natural disasters, bioter16 rorism events, and other emergencies. 

17 ‘‘(f) STUDENT DROPPED FROM TRACK IN AFFILIATE

18 SCHOOL.—A medical, dental, physician assistant, phar19 macy, behavioral and mental health, public health, or 

20 nursing student who, under regulations prescribed by the 

21 Surgeon General, is dropped from the Track in an affili22 ated school for deficiency in conduct or studies, or for 

23 other reasons, shall be liable to the United States for all 

24 tuition and stipend support provided to the student. 


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1 ‘‘SEC. 274. FUNDING. 

2 ‘‘Beginning with fiscal year 2010, the Secretary shall 

3 transfer from the Public Health and Social Services Emer4 gency Fund such sums as may be necessary to carry out 

5 this part.’’. 

6 Subtitle E—Supporting the 

7 Existing Health Care Workforce 

8 SEC. 5401. CENTERS OF EXCELLENCE. 

9 Section 736 of the Public Health Service Act (42 

10 U.S.C. 293) is amended by striking subsection (h) and in11 serting the following: 

12 ‘‘(h) FORMULA FOR ALLOCATIONS.— 

13 ‘‘(1) ALLOCATIONS.—Based on the amount ap14 propriated under subsection (i) for a fiscal year, the 

15 following subparagraphs shall apply as appropriate: 

16 ‘‘(A) IN GENERAL.—If the amounts appro17 priated under subsection (i) for a fiscal year are 

18 $24,000,000 or less— 

19 ‘‘(i) the Secretary shall make available 

20 $12,000,000 for grants under subsection 

21 (a) to health professions schools that meet 

22 the conditions described in subsection 

23 (c)(2)(A); and 

24 ‘‘(ii) and available after grants are 

25 made with funds under clause (i), the Sec26 retary shall make available— 


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1 ‘‘(I) 60 percent of such amount 

2 for grants under subsection (a) to 

3 health professions schools that meet 

4 the conditions described in paragraph 

5 (3) or (4) of subsection (c) (including 

6 meeting the conditions under sub7 section (e)); and 

8 ‘‘(II) 40 percent of such amount 

9 for grants under subsection (a) to 

10 health professions schools that meet 

11 the conditions described in subsection 

12 (c)(5). 

13 ‘‘(B) FUNDING IN EXCESS OF

14 $24,000,000.—If amounts appropriated under 

15 subsection (i) for a fiscal year exceed 

16 $24,000,000 but are less than $30,000,000— 

17 ‘‘(i) 80 percent of such excess 

18 amounts shall be made available for grants 

19 under subsection (a) to health professions 

20 schools that meet the requirements de21 scribed in paragraph (3) or (4) of sub22 section (c) (including meeting conditions 

23 pursuant to subsection (e)); and 

24 ‘‘(ii) 20 percent of such excess 

25 amount shall be made available for grants 


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1 under subsection (a) to health professions 

2 schools that meet the conditions described 

3 in subsection (c)(5). 

4 ‘‘(C) FUNDING IN EXCESS OF

5 $30,000,000.—If amounts appropriated under 

6 subsection (i) for a fiscal year exceed 

7 $30,000,000 but are less than $40,000,000, the 

8 Secretary shall make available— 

9 ‘‘(i) not less than $12,000,000 for 

10 grants under subsection (a) to health pro11 fessions schools that meet the conditions 

12 described in subsection (c)(2)(A); 

13 ‘‘(ii) not less than $12,000,000 for 

14 grants under subsection (a) to health pro15 fessions schools that meet the conditions 

16 described in paragraph (3) or (4) of sub17 section (c) (including meeting conditions 

18 pursuant to subsection (e)); 

19 ‘‘(iii) not less than $6,000,000 for 

20 grants under subsection (a) to health pro21 fessions schools that meet the conditions 

22 described in subsection (c)(5); and 

23 ‘‘(iv) after grants are made with 

24 funds under clauses (i) through (iii), any 

25 remaining excess amount for grants under 


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1 subsection (a) to health professions schools 

2 that meet the conditions described in para3 graph (2)(A), (3), (4), or (5) of subsection 

4 (c). 

5 ‘‘(D) FUNDING IN EXCESS OF

6 $40,000,000.—If amounts appropriated under 

7 subsection (i) for a fiscal year are $40,000,000 

8 or more, the Secretary shall make available— 

9 ‘‘(i) not less than $16,000,000 for 

10 grants under subsection (a) to health pro11 fessions schools that meet the conditions 

12 described in subsection (c)(2)(A); 

13 ‘‘(ii) not less than $16,000,000 for 

14 grants under subsection (a) to health pro15 fessions schools that meet the conditions 

16 described in paragraph (3) or (4) of sub17 section (c) (including meeting conditions 

18 pursuant to subsection (e)); 

19 ‘‘(iii) not less than $8,000,000 for 

20 grants under subsection (a) to health pro21 fessions schools that meet the conditions 

22 described in subsection (c)(5); and 

23 ‘‘(iv) after grants are made with 

24 funds under clauses (i) through (iii), any 

25 remaining funds for grants under subVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01414 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 section (a) to health professions schools 

2 that meet the conditions described in para3 graph (2)(A), (3), (4), or (5) of subsection 

4 (c). 

5 ‘‘(2) NO LIMITATION.—Nothing in this sub6 section shall be construed as limiting the centers of 

7 excellence referred to in this section to the des8 ignated amount, or to preclude such entities from 

9 competing for grants under this section. 

10 ‘‘(3) MAINTENANCE OF EFFORT.— 

11 ‘‘(A) IN GENERAL.—With respect to activi12 ties for which a grant made under this part are 

13 authorized to be expended, the Secretary may 

14 not make such a grant to a center of excellence 

15 for any fiscal year unless the center agrees to 

16 maintain expenditures of non-Federal amounts 

17 for such activities at a level that is not less 

18 than the level of such expenditures maintained 

19 by the center for the fiscal year preceding the 

20 fiscal year for which the school receives such a 

21 grant. 

22 ‘‘(B) USE OF FEDERAL FUNDS.—With re23 spect to any Federal amounts received by a cen24 ter of excellence and available for carrying out 

25 activities for which a grant under this part is 


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1 authorized to be expended, the center shall, be2 fore expending the grant, expend the Federal 

3 amounts obtained from sources other than the 

4 grant, unless given prior approval from the Sec5 retary. 

6 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There 

7 are authorized to be appropriated to carry out this sec8 tion— 

9 ‘‘(1) $50,000,000 for each of the fiscal years 

10 2010 through 2015; and 

11 ‘‘(2) and such sums as are necessary for each 

12 subsequent fiscal year.’’. 

13 SEC. 5402. HEALTH CARE PROFESSIONALS TRAINING FOR 

14 DIVERSITY. 

15 (a) LOAN REPAYMENTS AND FELLOWSHIPS REGARD16 ING FACULTY POSITIONS.—Section 738(a)(1) of the Pub17 lic Health Service Act (42 U.S.C. 293b(a)(1)) is amended 

18 by striking ‘‘$20,000 of the principal and interest of the 

19 educational loans of such individuals.’’ and inserting 

20 ‘‘$30,000 of the principal and interest of the educational 

21 loans of such individuals.’’. 

22 (b) SCHOLARSHIPS FOR DISADVANTAGED STU23 DENTS.—Section 740(a) of such Act (42 U.S.C. 293d(a)) 

24 is amended by striking ‘‘$37,000,000’’ and all that follows 

25 through ‘‘2002’’ and inserting ‘‘$51,000,000 for fiscal 


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1 year 2010, and such sums as may be necessary for each 

2 of the fiscal years 2011 through 2014’’. 

3 (c) REAUTHORIZATION FOR LOAN REPAYMENTS AND

4 FELLOWSHIPS REGARDING FACULTY POSITIONS.—Sec5 tion 740(b) of such Act (42 U.S.C. 293d(b)) is amended 

6 by striking ‘‘appropriated’’ and all that follows through 

7 the period at the end and inserting ‘‘appropriated, 

8 $5,000,000 for each of the fiscal years 2010 through 

9 2014.’’. 

10 (d) REAUTHORIZATION FOR EDUCATIONAL ASSIST11 ANCE IN THE HEALTH PROFESSIONS REGARDING INDI12 VIDUALS FROM A DISADVANTAGED BACKGROUND.—Sec13 tion 740(c) of such Act (42 U.S.C. 293d(c)) is amended 

14 by striking the first sentence and inserting the following: 

15 ‘‘For the purpose of grants and contracts under section 

16 739(a)(1), there is authorized to be appropriated 

17 $60,000,000 for fiscal year 2010 and such sums as may 

18 be necessary for each of the fiscal years 2011 through 

19 2014.’’ 

20 SEC. 5403. INTERDISCIPLINARY, COMMUNITY-BASED LINK21 AGES. 

22 (a) AREA HEALTH EDUCATION CENTERS.—Section 

23 751 of the Public Health Service Act (42 U.S.C. 294a) 

24 is amended to read as follows: 


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1 ‘‘SEC. 751. AREA HEALTH EDUCATION CENTERS. 

2 ‘‘(a) ESTABLISHMENT OF AWARDS.—The Secretary 

3 shall make the following 2 types of awards in accordance 

4 with this section: 

5 ‘‘(1) INFRASTRUCTURE DEVELOPMENT

6 AWARD.—The Secretary shall make awards to eligi7 ble entities to enable such entities to initiate health 

8 care workforce educational programs or to continue 

9 to carry out comparable programs that are operating 

10 at the time the award is made by planning, devel11 oping, operating, and evaluating an area health edu12 cation center program. 

13 ‘‘(2) POINT OF SERVICE MAINTENANCE AND

14 ENHANCEMENT AWARD.—The Secretary shall make 

15 awards to eligible entities to maintain and improve 

16 the effectiveness and capabilities of an existing area 

17 health education center program, and make other 

18 modifications to the program that are appropriate 

19 due to changes in demographics, needs of the popu20 lations served, or other similar issues affecting the 

21 area health education center program. For the pur22 poses of this section, the term ‘Program’ refers to 

23 the area health education center program. 

24 ‘‘(b) ELIGIBLE ENTITIES; APPLICATION.— 

25 ‘‘(1) ELIGIBLE ENTITIES.— 


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1 ‘‘(A) INFRASTRUCTURE DEVELOPMENT.— 

2 For purposes of subsection (a)(1), the term ‘eli3 gible entity’ means a school of medicine or os4 teopathic medicine, an incorporated consortium 

5 of such schools, or the parent institutions of 

6 such a school. With respect to a State in which 

7 no area health education center program is in 

8 operation, the Secretary may award a grant or 

9 contract under subsection (a)(1) to a school of 

10 nursing. 

11 ‘‘(B) POINT OF SERVICE MAINTENANCE

12 AND ENHANCEMENT.—For purposes of sub13 section (a)(2), the term ‘eligible entity’ means 

14 an entity that has received funds under this 

15 section, is operating an area health education 

16 center program, including an area health edu17 cation center or centers, and has a center or 

18 centers that are no longer eligible to receive fi19 nancial assistance under subsection (a)(1). 

20 ‘‘(2) APPLICATION.—An eligible entity desiring 

21 to receive an award under this section shall submit 

22 to the Secretary an application at such time, in such 

23 manner, and containing such information as the Sec24 retary may require. 

25 ‘‘(c) USE OF FUNDS.— 


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1 ‘‘(1) REQUIRED ACTIVITIES.—An eligible entity 

2 shall use amounts awarded under a grant under sub3 section (a)(1) or (a)(2) to carry out the following ac4 tivities: 

5 ‘‘(A) Develop and implement strategies, in 

6 coordination with the applicable one-stop deliv7 ery system under section 134(c) of the Work8 force Investment Act of 1998, to recruit indi9 viduals from underrepresented minority popu10 lations or from disadvantaged or rural back11 grounds into health professions, and support 

12 such individuals in attaining such careers. 

13 ‘‘(B) Develop and implement strategies to 

14 foster and provide community-based training 

15 and education to individuals seeking careers in 

16 health professions within underserved areas for 

17 the purpose of developing and maintaining a di18 verse health care workforce that is prepared to 

19 deliver high-quality care, with an emphasis on 

20 primary care, in underserved areas or for health 

21 disparity populations, in collaboration with 

22 other Federal and State health care workforce 

23 development programs, the State workforce 

24 agency, and local workforce investment boards, 

25 and in health care safety net sites. 


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1 ‘‘(C) Prepare individuals to more effec2 tively provide health services to underserved 

3 areas and health disparity populations through 

4 field placements or preceptorships in conjunc5 tion with community-based organizations, ac6 credited primary care residency training pro7 grams, Federally qualified health centers, rural 

8 health clinics, public health departments, or 

9 other appropriate facilities. 

10 ‘‘(D) Conduct and participate in inter11 disciplinary training that involves physicians, 

12 physician assistants, nurse practitioners, nurse 

13 midwives, dentists, psychologists, pharmacists, 

14 optometrists, community health workers, public 

15 and allied health professionals, or other health 

16 professionals, as practicable. 

17 ‘‘(E) Deliver or facilitate continuing edu18 cation and information dissemination programs 

19 for health care professionals, with an emphasis 

20 on individuals providing care in underserved 

21 areas and for health disparity populations. 

22 ‘‘(F) Propose and implement effective pro23 gram and outcomes measurement and evalua24 tion strategies. 


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1 ‘‘(G) Establish a youth public health pro2 gram to expose and recruit high school students 

3 into health careers, with a focus on careers in 

4 public health. 

5 ‘‘(2) INNOVATIVE OPPORTUNITIES.—An eligible 

6 entity may use amounts awarded under a grant 

7 under subsection (a)(1) or subsection (a)(2) to carry 

8 out any of the following activities: 

9 ‘‘(A) Develop and implement innovative 

10 curricula in collaboration with community-based 

11 accredited primary care residency training pro12 grams, Federally qualified health centers, rural 

13 health clinics, behavioral and mental health fa14 cilities, public health departments, or other ap15 propriate facilities, with the goal of increasing 

16 the number of primary care physicians and 

17 other primary care providers prepared to serve 

18 in underserved areas and health disparity popu19 lations. 

20 ‘‘(B) Coordinate community-based 

21 participatory research with academic health 

22 centers, and facilitate rapid flow and dissemina23 tion of evidence-based health care information, 

24 research results, and best practices to improve 

25 quality, efficiency, and effectiveness of health 


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1 care and health care systems within community 

2 settings. 

3 ‘‘(C) Develop and implement other strate4 gies to address identified workforce needs and 

5 increase and enhance the health care workforce 

6 in the area served by the area health education 

7 center program. 

8 ‘‘(d) REQUIREMENTS.— 

9 ‘‘(1) AREA HEALTH EDUCATION CENTER PRO10 GRAM.—In carrying out this section, the Secretary 

11 shall ensure the following: 

12 ‘‘(A) An entity that receives an award 

13 under this section shall conduct at least 10 per14 cent of clinical education required for medical 

15 students in community settings that are re16 moved from the primary teaching facility of the 

17 contracting institution for grantees that operate 

18 a school of medicine or osteopathic medicine. In 

19 States in which an entity that receives an 

20 award under this section is a nursing school or 

21 its parent institution, the Secretary shall alter22 natively ensure that— 

23 ‘‘(i) the nursing school conducts at 

24 least 10 percent of clinical education re25 quired for nursing students in community 


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1 settings that are remote from the primary 

2 teaching facility of the school; and 

3 ‘‘(ii) the entity receiving the award 

4 maintains a written agreement with a 

5 school of medicine or osteopathic medicine 

6 to place students from that school in train7 ing sites in the area health education cen8 ter program area. 

9 ‘‘(B) An entity receiving funds under sub10 section (a)(2) does not distribute such funding 

11 to a center that is eligible to receive funding 

12 under subsection (a)(1). 

13 ‘‘(2) AREA HEALTH EDUCATION CENTER.—The 

14 Secretary shall ensure that each area health edu15 cation center program includes at least 1 area health 

16 education center, and that each such center— 

17 ‘‘(A) is a public or private organization 

18 whose structure, governance, and operation is 

19 independent from the awardee and the parent 

20 institution of the awardee; 

21 ‘‘(B) is not a school of medicine or osteo22 pathic medicine, the parent institution of such 

23 a school, or a branch campus or other subunit 

24 of a school of medicine or osteopathic medicine 


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1 or its parent institution, or a consortium of 

2 such entities; 

3 ‘‘(C) designates an underserved area or 

4 population to be served by the center which is 

5 in a location removed from the main location of 

6 the teaching facilities of the schools partici7 pating in the program with such center and 

8 does not duplicate, in whole or in part, the geo9 graphic area or population served by any other 

10 center; 

11 ‘‘(D) fosters networking and collaboration 

12 among communities and between academic 

13 health centers and community-based centers; 

14 ‘‘(E) serves communities with a dem15 onstrated need of health professionals in part16 nership with academic medical centers; 

17 ‘‘(F) addresses the health care workforce 

18 needs of the communities served in coordination 

19 with the public workforce investment system; 

20 and 

21 ‘‘(G) has a community-based governing or 

22 advisory board that reflects the diversity of the 

23 communities involved. 

24 ‘‘(e) MATCHING FUNDS.—With respect to the costs 

25 of operating a program through a grant under this section, 


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1 to be eligible for financial assistance under this section, 

2 an entity shall make available (directly or through con3 tributions from State, county or municipal governments, 

4 or the private sector) recurring non-Federal contributions 

5 in cash or in kind, toward such costs in an amount that 

6 is equal to not less than 50 percent of such costs. At least 

7 25 percent of the total required non-Federal contributions 

8 shall be in cash. An entity may apply to the Secretary 

9 for a waiver of not more than 75 percent of the matching 

10 fund amount required by the entity for each of the first 

11 3 years the entity is funded through a grant under sub12 section (a)(1). 

13 ‘‘(f) LIMITATION.—Not less than 75 percent of the 

14 total amount provided to an area health education center 

15 program under subsection (a)(1) or (a)(2) shall be allo16 cated to the area health education centers participating 

17 in the program under this section. To provide needed flexi18 bility to newly funded area health education center pro19 grams, the Secretary may waive the requirement in the 

20 sentence for the first 2 years of a new area health edu21 cation center program funded under subsection (a)(1). 

22 ‘‘(g) AWARD.—An award to an entity under this sec23 tion shall be not less than $250,000 annually per area 

24 health education center included in the program involved. 

25 If amounts appropriated to carry out this section are not 


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1 sufficient to comply with the preceding sentence, the Sec2 retary may reduce the per center amount provided for in 

3 such sentence as necessary, provided the distribution es4 tablished in subsection (j)(2) is maintained. 

5 ‘‘(h) PROJECT TERMS.— 

6 ‘‘(1) IN GENERAL.—Except as provided in para7 graph (2), the period during which payments may be 

8 made under an award under subsection (a)(1) may 

9 not exceed— 

10 ‘‘(A) in the case of a program, 12 years; 

11 or 

12 ‘‘(B) in the case of a center within a pro13 gram, 6 years. 

14 ‘‘(2) EXCEPTION.—The periods described in 

15 paragraph (1) shall not apply to programs receiving 

16 point of service maintenance and enhancement 

17 awards under subsection (a)(2) to maintain existing 

18 centers and activities. 

19 ‘‘(i) INAPPLICABILITY OF PROVISION.—Notwith20 standing any other provision of this title, section 791(a) 

21 shall not apply to an area health education center funded 

22 under this section. 

23 ‘‘(j) AUTHORIZATION OF APPROPRIATIONS.— 


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1 ‘‘(1) IN GENERAL.—There is authorized to be 

2 appropriated to carry out this section $125,000,000 

3 for each of the fiscal years 2010 through 2014. 

4 ‘‘(2) REQUIREMENTS.—Of the amounts appro5 priated for a fiscal year under paragraph (1)— 

6 ‘‘(A) not more than 35 percent shall be 

7 used for awards under subsection (a)(1); 

8 ‘‘(B) not less than 60 percent shall be used 

9 for awards under subsection (a)(2); 

10 ‘‘(C) not more than 1 percent shall be used 

11 for grants and contracts to implement outcomes 

12 evaluation for the area health education cen13 ters; and 

14 ‘‘(D) not more than 4 percent shall be 

15 used for grants and contracts to provide tech16 nical assistance to entities receiving awards 

17 under this section. 

18 ‘‘(3) CARRYOVER FUNDS.—An entity that re19 ceives an award under this section may carry over 

20 funds from 1 fiscal year to another without obtain21 ing approval from the Secretary. In no case may any 

22 funds be carried over pursuant to the preceding sen23 tence for more than 3 years. 


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1 ‘‘(k) SENSE OF CONGRESS.—It is the sense of the 

2 Congress that every State have an area health education 

3 center program in effect under this section.’’. 

4 (b) CONTINUING EDUCATIONAL SUPPORT FOR

5 HEALTH PROFESSIONALS SERVING IN UNDERSERVED

6 COMMUNITIES.—Part D of title VII of the Public Health 

7 Service Act (42 U.S.C. 294 et seq.) is amended by striking 

8 section 752 and inserting the following: 

9 ‘‘SEC. 752. CONTINUING EDUCATIONAL SUPPORT FOR 

10 HEALTH PROFESSIONALS SERVING IN UN11 DERSERVED COMMUNITIES. 

12 ‘‘(a) IN GENERAL.—The Secretary shall make grants 

13 to, and enter into contracts with, eligible entities to im14 prove health care, increase retention, increase representa15 tion of minority faculty members, enhance the practice en16 vironment, and provide information dissemination and 

17 educational support to reduce professional isolation 

18 through the timely dissemination of research findings 

19 using relevant resources. 

20 ‘‘(b) ELIGIBLE ENTITIES.—For purposes of this sec21 tion, the term ‘eligible entity’ means an entity described 

22 in section 799(b). 

23 ‘‘(c) APPLICATION.—An eligible entity desiring to re24 ceive an award under this section shall submit to the SecVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01429 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 retary an application at such time, in such manner, and 

2 containing such information as the Secretary may require. 

3 ‘‘(d) USE OF FUNDS.—An eligible entity shall use 

4 amounts awarded under a grant or contract under this 

5 section to provide innovative supportive activities to en6 hance education through distance learning, continuing 

7 educational activities, collaborative conferences, and elec8 tronic and telelearning activities, with priority for primary 

9 care. 

10 ‘‘(e) AUTHORIZATION.—There is authorized to be ap11 propriated to carry out this section $5,000,000 for each 

12 of the fiscal years 2010 through 2014, and such sums as 

13 may be necessary for each subsequent fiscal year.’’. 

14 SEC. 5404. WORKFORCE DIVERSITY GRANTS. 

15 Section 821 of the Public Health Service Act (42 

16 U.S.C. 296m) is amended— 

17 (1) in subsection (a)— 

18 (A) by striking ‘‘The Secretary may’’ and 

19 inserting the following: 

20 ‘‘(1) AUTHORITY.—The Secretary may’’; 

21 (B) by striking ‘‘pre-entry preparation, 

22 and retention activities’’ and inserting the fol23 lowing: ‘‘stipends for diploma or associate de24 gree nurses to enter a bridge or degree comple25 tion program, student scholarships or stipends 


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1 for accelerated nursing degree programs, pre2 entry preparation, advanced education prepara3 tion, and retention activities’’; and 

4 (2) in subsection (b)— 

5 (A) by striking ‘‘First’’ and all that follows 

6 through ‘‘including the’’ and inserting ‘‘Na7 tional Advisory Council on Nurse Education 

8 and Practice and consult with nursing associa9 tions including the National Coalition of Ethnic 

10 Minority Nurse Associations,’’; and 

11 (B) by inserting before the period the fol12 lowing: ‘‘, and other organizations determined 

13 appropriate by the Secretary’’. 

14 SEC. 5405. PRIMARY CARE EXTENSION PROGRAM. 

15 Part P of title III of the Public Health Service Act 

16 (42 U.S.C. 280g et seq.), as amended by section 5313, 

17 is further amended by adding at the end the following: 

18 ‘‘SEC. 399W. PRIMARY CARE EXTENSION PROGRAM. 

19 ‘‘(a) ESTABLISHMENT, PURPOSE AND DEFINI20 TION.— 

21 ‘‘(1) IN GENERAL.—The Secretary, acting 

22 through the Director of the Agency for Healthcare 

23 Research and Quality, shall establish a Primary 

24 Care Extension Program. 


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1 ‘‘(2) PURPOSE.—The Primary Care Extension 

2 Program shall provide support and assistance to pri3 mary care providers to educate providers about pre4 ventive medicine, health promotion, chronic disease 

5 management, mental and behavioral health services 

6 (including substance abuse prevention and treatment 

7 services), and evidence-based and evidence-informed 

8 therapies and techniques, in order to enable pro9 viders to incorporate such matters into their practice 

10 and to improve community health by working with 

11 community-based health connectors (referred to in 

12 this section as ‘Health Extension Agents’). 

13 ‘‘(3) DEFINITIONS.—In this section: 

14 ‘‘(A) HEALTH EXTENSION AGENT.—The 

15 term ‘Health Extension Agent’ means any local, 

16 community-based health worker who facilitates 

17 and provides assistance to primary care prac18 tices by implementing quality improvement or 

19 system redesign, incorporating the principles of 

20 the patient-centered medical home to provide 

21 high-quality, effective, efficient, and safe pri22 mary care and to provide guidance to patients 

23 in culturally and linguistically appropriate ways, 

24 and linking practices to diverse health system 

25 resources. 


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1 ‘‘(B) PRIMARY CARE PROVIDER.—The 

2 term ‘primary care provider’ means a clinician 

3 who provides integrated, accessible health care 

4 services and who is accountable for addressing 

5 a large majority of personal health care needs, 

6 including providing preventive and health pro7 motion services for men, women, and children 

8 of all ages, developing a sustained partnership 

9 with patients, and practicing in the context of 

10 family and community, as recognized by a State 

11 licensing or regulatory authority, unless other12 wise specified in this section. 

13 ‘‘(b) GRANTS TO ESTABLISH STATE HUBS AND

14 LOCAL PRIMARY CARE EXTENSION AGENCIES.— 

15 ‘‘(1) GRANTS.—The Secretary shall award com16 petitive grants to States for the establishment of 

17 State- or multistate-level primary care Primary Care 

18 Extension Program State Hubs (referred to in this 

19 section as ‘Hubs’). 

20 ‘‘(2) COMPOSITION OF HUBS.—A Hub estab21 lished by a State pursuant to paragraph (1)— 

22 ‘‘(A) shall consist of, at a minimum, the 

23 State health department, the entity responsible 

24 for administering the State Medicaid program 

25 (if other than the State health department), the 


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1 State-level entity administering the Medicare 

2 program, and the departments of 1 or more 

3 health professions schools in the State that 

4 train providers in primary care; and 

5 ‘‘(B) may include entities such as hospital 

6 associations, primary care practice-based re7 search networks, health professional societies, 

8 State primary care associations, State licensing 

9 boards, organizations with a contract with the 

10 Secretary under section 1153 of the Social Se11 curity Act, consumer groups, and other appro12 priate entities. 

13 ‘‘(c) STATE AND LOCAL ACTIVITIES.— 

14 ‘‘(1) HUB ACTIVITIES.—Hubs established under 

15 a grant under subsection (b) shall— 

16 ‘‘(A) submit to the Secretary a plan to co17 ordinate functions with quality improvement or18 ganizations and area health education centers if 

19 such entities are members of the Hub not de20 scribed in subsection (b)(2)(A); 

21 ‘‘(B) contract with a county- or local-level 

22 entity that shall serve as the Primary Care Ex23 tension Agency to administer the services de24 scribed in paragraph (2); 


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1 ‘‘(C) organize and administer grant funds 

2 to county- or local-level Primary Care Exten3 sion Agencies that serve a catchment area, as 

4 determined by the State; and 

5 ‘‘(D) organize State-wide or multistate net6 works of local-level Primary Care Extension 

7 Agencies to share and disseminate information 

8 and practices. 

9 ‘‘(2) LOCAL PRIMARY CARE EXTENSION AGENCY

10 ACTIVITIES.— 

11 ‘‘(A) REQUIRED ACTIVITIES.—Primary 

12 Care Extension Agencies established by a Hub 

13 under paragraph (1) shall— 

14 ‘‘(i) assist primary care providers to 

15 implement a patient-centered medical home 

16 to improve the accessibility, quality, and 

17 efficiency of primary care services, includ18 ing health homes; 

19 ‘‘(ii) develop and support primary care 

20 learning communities to enhance the dis21 semination of research findings for evi22 dence-based practice, assess implementa23 tion of practice improvement, share best 

24 practices, and involve community clinicians 

25 in the generation of new knowledge and 


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1 identification of important questions for 

2 research; 

3 ‘‘(iii) participate in a national network 

4 of Primary Care Extension Hubs and pro5 pose how the Primary Care Extension 

6 Agency will share and disseminate lessons 

7 learned and best practices; and 

8 ‘‘(iv) develop a plan for financial sus9 tainability involving State, local, and pri10 vate contributions, to provide for the re11 duction in Federal funds that is expected 

12 after an initial 6-year period of program 

13 establishment, infrastructure development, 

14 and planning. 

15 ‘‘(B) DISCRETIONARY ACTIVITIES.—Pri16 mary Care Extension Agencies established by a 

17 Hub under paragraph (1) may— 

18 ‘‘(i) provide technical assistance, 

19 training, and organizational support for 

20 community health teams established under 

21 section 3602 of the Patient Protection and 

22 Affordable Care Act; 

23 ‘‘(ii) collect data and provision of pri24 mary care provider feedback from stand25 ardized measurements of processes and 


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1 outcomes to aid in continuous performance 

2 improvement; 

3 ‘‘(iii) collaborate with local health de4 partments, community health centers, 

5 tribes and tribal entities, and other com6 munity agencies to identify community 

7 health priorities and local health workforce 

8 needs, and participate in community-based 

9 efforts to address the social and primary 

10 determinants of health, strengthen the 

11 local primary care workforce, and eliminate 

12 health disparities; 

13 ‘‘(iv) develop measures to monitor the 

14 impact of the proposed program on the 

15 health of practice enrollees and of the 

16 wider community served; and 

17 ‘‘(v) participate in other activities, as 

18 determined appropriate by the Secretary. 

19 ‘‘(d) FEDERAL PROGRAM ADMINISTRATION.— 

20 ‘‘(1) GRANTS; TYPES.—Grants awarded under 

21 subsection (b) shall be— 

22 ‘‘(A) program grants, that are awarded to 

23 State or multistate entities that submit fully-de24 veloped plans for the implementation of a Hub, 

25 for a period of 6 years; or 


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1 ‘‘(B) planning grants, that are awarded to 

2 State or multistate entities with the goal of de3 veloping a plan for a Hub, for a period of 2 

4 years. 

5 ‘‘(2) APPLICATIONS.—To be eligible for a grant 

6 under subsection (b), a State or multistate entity 

7 shall submit to the Secretary an application, at such 

8 time, in such manner, and containing such informa9 tion as the Secretary may require. 

10 ‘‘(3) EVALUATION.—A State that receives a 

11 grant under subsection (b) shall be evaluated at the 

12 end of the grant period by an evaluation panel ap13 pointed by the Secretary. 

14 ‘‘(4) CONTINUING SUPPORT.—After the sixth 

15 year in which assistance is provided to a State under 

16 a grant awarded under subsection (b), the State may 

17 receive additional support under this section if the 

18 State program has received satisfactory evaluations 

19 with respect to program performance and the merits 

20 of the State sustainability plan, as determined by 

21 the Secretary. 

22 ‘‘(5) LIMITATION.—A State shall not use in ex23 cess of 10 percent of the amount received under a 

24 grant to carry out administrative activities under 


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1 this section. Funds awarded pursuant to this section 

2 shall not be used for funding direct patient care. 

3 ‘‘(e) REQUIREMENTS ON THE SECRETARY.—In car4 rying out this section, the Secretary shall consult with the 

5 heads of other Federal agencies with demonstrated experi6 ence and expertise in health care and preventive medicine, 

7 such as the Centers for Disease Control and Prevention, 

8 the Substance Abuse and Mental Health Administration, 

9 the Health Resources and Services Administration, the 

10 National Institutes of Health, the Office of the National 

11 Coordinator for Health Information Technology, the In12 dian Health Service, the Agricultural Cooperative Exten13 sion Service of the Department of Agriculture, and other 

14 entities, as the Secretary determines appropriate. 

15 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—To 

16 awards grants as provided in subsection (d), there are au17 thorized to be appropriated $120,000,000 for each of fis18 cal years 2011 and 2012, and such sums as may be nec19 essary to carry out this section for each of fiscal years 

20 2013 through 2014.’’. 


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1 Subtitle F—Strengthening Primary 

2 Care and Other Workforce Im3 provements 

4 SEC. 5501. EXPANDING ACCESS TO PRIMARY CARE SERV5 ICES AND GENERAL SURGERY SERVICES. 

6 (a) INCENTIVE PAYMENT PROGRAM FOR PRIMARY

7 CARE SERVICES.— 

8 (1) IN GENERAL.—Section 1833 of the Social 

9 Security Act (42 U.S.C. 1395l) is amended by add10 ing at the end the following new subsection: 

11 ‘‘(x) INCENTIVE PAYMENTS FOR PRIMARY CARE

12 SERVICES.— 

13 ‘‘(1) IN GENERAL.—In the case of primary care 

14 services furnished on or after January 1, 2011, and 

15 before January 1, 2016, by a primary care practi16 tioner, in addition to the amount of payment that 

17 would otherwise be made for such services under this 

18 part, there also shall be paid (on a monthly or quar19 terly basis) an amount equal to 10 percent of the 

20 payment amount for the service under this part. 

21 ‘‘(2) DEFINITIONS.—In this subsection: 

22 ‘‘(A) PRIMARY CARE PRACTITIONER.—The 

23 term ‘primary care practitioner’ means an indi24 vidual— 

25 ‘‘(i) who— 


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1 ‘‘(I) is a physician (as described 

2 in section 1861(r)(1)) who has a pri3 mary specialty designation of family 

4 medicine, internal medicine, geriatric 

5 medicine, or pediatric medicine; or 

6 ‘‘(II) is a nurse practitioner, clin7 ical nurse specialist, or physician as8 sistant (as those terms are defined in 

9 section 1861(aa)(5)); and 

10 ‘‘(ii) for whom primary care services 

11 accounted for at least 60 percent of the al12 lowed charges under this part for such 

13 physician or practitioner in a prior period 

14 as determined appropriate by the Sec15 retary. 

16 ‘‘(B) PRIMARY CARE SERVICES.—The term 

17 ‘primary care services’ means services identi18 fied, as of January 1, 2009, by the following 

19 HCPCS codes (and as subsequently modified by 

20 the Secretary): 

21 ‘‘(i) 99201 through 99215. 

22 ‘‘(ii) 99304 through 99340. 

23 ‘‘(iii) 99341 through 99350. 

24 ‘‘(3) COORDINATION WITH OTHER PAY25 MENTS.—The amount of the additional payment for 


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1 a service under this subsection and subsection (m) 

2 shall be determined without regard to any additional 

3 payment for the service under subsection (m) and 

4 this subsection, respectively. 

5 ‘‘(4) LIMITATION ON REVIEW.—There shall be 

6 no administrative or judicial review under section 

7 1869, 1878, or otherwise, respecting the identifica8 tion of primary care practitioners under this sub9 section.’’. 

10 (2) CONFORMING AMENDMENT.—Section 

11 1834(g)(2)(B) of the Social Security Act (42 U.S.C. 

12 1395m(g)(2)(B)) is amended by adding at the end 

13 the following sentence: ‘‘Section 1833(x) shall not be 

14 taken into account in determining the amounts that 

15 would otherwise be paid pursuant to the preceding 

16 sentence.’’. 

17 (b) INCENTIVE PAYMENT PROGRAM FOR MAJOR

18 SURGICAL PROCEDURES FURNISHED IN HEALTH PRO19 FESSIONAL SHORTAGE AREAS.— 

20 (1) IN GENERAL.—Section 1833 of the Social 

21 Security Act (42 U.S.C. 1395l), as amended by sub22 section (a)(1), is amended by adding at the end the 

23 following new subsection: 


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1 ‘‘(y) INCENTIVE PAYMENTS FOR MAJOR SURGICAL

2 PROCEDURES FURNISHED IN HEALTH PROFESSIONAL

3 SHORTAGE AREAS.— 

4 ‘‘(1) IN GENERAL.—In the case of major sur5 gical procedures furnished on or after January 1, 

6 2011, and before January 1, 2016, by a general sur7 geon in an area that is designated (under section 

8 332(a)(1)(A) of the Public Health Service Act) as a 

9 health professional shortage area as identified by the 

10 Secretary prior to the beginning of the year involved, 

11 in addition to the amount of payment that would 

12 otherwise be made for such services under this part, 

13 there also shall be paid (on a monthly or quarterly 

14 basis) an amount equal to 10 percent of the pay15 ment amount for the service under this part. 

16 ‘‘(2) DEFINITIONS.—In this subsection: 

17 ‘‘(A) GENERAL SURGEON.—In this sub18 section, the term ‘general surgeon’ means a 

19 physician (as described in section 1861(r)(1)) 

20 who has designated CMS specialty code 02– 

21 General Surgery as their primary specialty code 

22 in the physician’s enrollment under section 

23 1866(j). 

24 ‘‘(B) MAJOR SURGICAL PROCEDURES.— 

25 The term ‘major surgical procedures’ means 


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1 physicians’ services which are surgical proce2 dures for which a 10-day or 90-day global pe3 riod is used for payment under the fee schedule 

4 under section 1848(b). 

5 ‘‘(3) COORDINATION WITH OTHER PAY6 MENTS.—The amount of the additional payment for 

7 a service under this subsection and subsection (m) 

8 shall be determined without regard to any additional 

9 payment for the service under subsection (m) and 

10 this subsection, respectively. 

11 ‘‘(4) APPLICATION.—The provisions of para12 graph (2) and (4) of subsection (m) shall apply to 

13 the determination of additional payments under this 

14 subsection in the same manner as such provisions 

15 apply to the determination of additional payments 

16 under subsection (m).’’. 

17 (2) CONFORMING AMENDMENT.—Section 

18 1834(g)(2)(B) of the Social Security Act (42 U.S.C. 

19 1395m(g)(2)(B)), as amended by subsection (a)(2), 

20 is amended by striking ‘‘Section 1833(x)’’ and in21 serting ‘‘Subsections (x) and (y) of section 1833’’ in 

22 the last sentence. 

23 (c) BUDGET-NEUTRALITY ADJUSTMENT.—Section 

24 1848(c)(2)(B) of the Social Security Act (42 U.S.C. 


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1 1395w–4(c)(2)(B)) is amended by adding at the end the 

2 following new clause: 

3 ‘‘(vii) ADJUSTMENT FOR CERTAIN

4 PHYSICIAN INCENTIVE PAYMENTS.—Fifty 

5 percent of the additional expenditures 

6 under this part attributable to subsections 

7 (x) and (y) of section 1833 for a year (as 

8 estimated by the Secretary) shall be taken 

9 into account in applying clause (ii)(II) for 

10 2011 and subsequent years. In lieu of ap11 plying the budget-neutrality adjustments 

12 required under clause (ii)(II) to relative 

13 value units to account for such costs for 

14 the year, the Secretary shall apply such 

15 budget-neutrality adjustments to the con16 version factor otherwise determined for the 

17 year. For 2011 and subsequent years, the 

18 Secretary shall increase the incentive pay19 ment otherwise applicable under section 

20 1833(m) by a percent estimated to be 

21 equal to the additional expenditures esti22 mated under the first sentence of this 

23 clause for such year that is applicable to 

24 physicians who primarily furnish services 

25 in areas designated (under section 


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1 332(a)(1)(A) of the Public Health Service 

2 Act) as health professional shortage 

3 areas.’’. 

4 SEC. 5502. MEDICARE FEDERALLY QUALIFIED HEALTH 

5 CENTER IMPROVEMENTS. 

6 (a) EXPANSION OF MEDICARE-COVERED PREVEN7 TIVE SERVICES AT FEDERALLY QUALIFIED HEALTH

8 CENTERS.— 

9 (1) IN GENERAL.—Section 1861(aa)(3)(A) of 

10 the Social Security Act (42 U.S.C. 1395w 

11 (aa)(3)(A)) is amended to read as follows: 

12 ‘‘(A) services of the type described sub13 paragraphs (A) through (C) of paragraph (1) 

14 and preventive services (as defined in section 

15 1861(ddd)(3)); and’’. 

16 (2) EFFECTIVE DATE.—The amendment made 

17 by paragraph (1) shall apply to services furnished on 

18 or after January 1, 2011. 

19 (b) PROSPECTIVE PAYMENT SYSTEM FOR FEDER20 ALLY QUALIFIED HEALTH CENTERS.—Section 1834 of 

21 the Social Security Act (42 U.S.C. 1395m) is amended 

22 by adding at the end the following new subsection: 

23 ‘‘(n) DEVELOPMENT AND IMPLEMENTATION OF PRO24 SPECTIVE PAYMENT SYSTEM.— 

25 ‘‘(1) DEVELOPMENT.— 


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1 ‘‘(A) IN GENERAL.—The Secretary shall 

2 develop a prospective payment system for pay3 ment for Federally qualified health services fur4 nished by Federally qualified health centers 

5 under this title. Such system shall include a 

6 process for appropriately describing the services 

7 furnished by Federally qualified health centers. 

8 ‘‘(B) COLLECTION OF DATA AND EVALUA9 TION.—The Secretary shall require Federally 

10 qualified health centers to submit to the Sec11 retary such information as the Secretary may 

12 require in order to develop and implement the 

13 prospective payment system under this para14 graph and paragraph (2), respectively, including 

15 the reporting of services using HCPCS codes. 

16 ‘‘(2) IMPLEMENTATION.— 

17 ‘‘(A) IN GENERAL.—Notwithstanding sec18 tion 1833(a)(3)(B), the Secretary shall provide, 

19 for cost reporting periods beginning on or after 

20 October 1, 2014, for payments for Federally 

21 qualified health services furnished by Federally 

22 qualified health centers under this title in ac23 cordance with the prospective payment system 

24 developed by the Secretary under paragraph 

25 (1). 


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1 ‘‘(B) PAYMENTS.— 

2 ‘‘(i) INITIAL PAYMENTS.—The Sec3 retary shall implement such prospective 

4 payment system so that the estimated 

5 amount of expenditures under this title for 

6 Federally qualified health services in the 

7 first year that the prospective payment 

8 system is implemented is equal to 103 per9 cent of the estimated amount of expendi10 tures under this title that would have oc11 curred for such services in such year if the 

12 system had not been implemented. 

13 ‘‘(ii) PAYMENTS IN SUBSEQUENT

14 YEARS.—In the year after the first year of 

15 implementation of such system, and in 

16 each subsequent year, the payment rate for 

17 Federally qualified health services fur18 nished in the year shall be equal to the 

19 payment rate established for such services 

20 furnished in the preceding year under this 

21 subparagraph increased by the percentage 

22 increase in the MEI (as defined in 

23 1842(i)(3)) for the year involved.’’. 


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1 SEC. 5503. DISTRIBUTION OF ADDITIONAL RESIDENCY PO2 SITIONS. 

3 (a) IN GENERAL.—Section 1886(h) of the Social Se4 curity Act (42 U.S.C. 1395ww(h)) is amended— 

5 (1) in paragraph (4)(F)(i), by striking ‘‘para6 graph (7)’’ and inserting ‘‘paragraphs (7) and (8)’’; 

7 (2) in paragraph (4)(H)(i), by striking ‘‘para8 graph (7)’’ and inserting ‘‘paragraphs (7) and (8)’’; 

9 (3) in paragraph (7)(E), by inserting ‘‘or para10 graph (8)’’ before the period at the end; and 

11 (4) by adding at the end the following new 

12 paragraph: 

13 ‘‘(8) DISTRIBUTION OF ADDITIONAL RESIDENCY

14 POSITIONS.— 

15 ‘‘(A) REDUCTIONS IN LIMIT BASED ON UN16 USED POSITIONS.— 

17 ‘‘(i) IN GENERAL.—Except as pro18 vided in clause (ii), if a hospital’s reference 

19 resident level (as defined in subparagraph 

20 (H)(i)) is less than the otherwise applica21 ble resident limit (as defined in subpara22 graph (H)(iii)), effective for portions of 

23 cost reporting periods occurring on or after 

24 July 1, 2011, the otherwise applicable resi25 dent limit shall be reduced by 65 percent 

26 of the difference between such otherwise 


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1 applicable resident limit and such reference 

2 resident level. 

3 ‘‘(ii) EXCEPTIONS.—This subpara4 graph shall not apply to— 

5 ‘‘(I) a hospital located in a rural 

6 area (as defined in subsection 

7 (d)(2)(D)(ii)) with fewer than 250 

8 acute care inpatient beds; 

9 ‘‘(II) a hospital that was part of 

10 a qualifying entity which had a vol11 untary residency reduction plan ap12 proved under paragraph (6)(B) or 

13 under the authority of section 402 of 

14 Public Law 90–248, if the hospital 

15 demonstrates to the Secretary that it 

16 has a specified plan in place for filling 

17 the unused positions by not later than 

18 2 years after the date of enactment of 

19 this paragraph; or 

20 ‘‘(III) a hospital described in 

21 paragraph (4)(H)(v). 

22 ‘‘(B) DISTRIBUTION.— 

23 ‘‘(i) IN GENERAL.—The Secretary 

24 shall increase the otherwise applicable resi25 dent limit for each qualifying hospital that 


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1 submits an application under this subpara2 graph by such number as the Secretary 

3 may approve for portions of cost reporting 

4 periods occurring on or after July 1, 2011. 

5 The aggregate number of increases in the 

6 otherwise applicable resident limit under 

7 this subparagraph shall be equal to the ag8 gregate reduction in such limits attrib9 utable to subparagraph (A) (as estimated 

10 by the Secretary). 

11 ‘‘(ii) REQUIREMENTS.—Subject to 

12 clause (iii), a hospital that receives an in13 crease in the otherwise applicable resident 

14 limit under this subparagraph shall ensure, 

15 during the 5-year period beginning on the 

16 date of such increase, that— 

17 ‘‘(I) the number of full-time 

18 equivalent primary care residents, as 

19 defined in paragraph (5)(H) (as de20 termined by the Secretary), excluding 

21 any additional positions under sub22 clause (II), is not less than the aver23 age number of full-time equivalent 

24 primary care residents (as so deter25 mined) during the 3 most recent cost 


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1 reporting periods ending prior to the 

2 date of enactment of this paragraph; 

3 and 

4 ‘‘(II) not less than 75 percent of 

5 the positions attributable to such in6 crease are in a primary care or gen7 eral surgery residency (as determined 

8 by the Secretary). 

9 The Secretary may determine whether a 

10 hospital has met the requirements under 

11 this clause during such 5-year period in 

12 such manner and at such time as the Sec13 retary determines appropriate, including at 

14 the end of such 5-year period. 

15 ‘‘(iii) REDISTRIBUTION OF POSITIONS

16 IF HOSPITAL NO LONGER MEETS CERTAIN

17 REQUIREMENTS.—In the case where the 

18 Secretary determines that a hospital de19 scribed in clause (ii) does not meet either 

20 of the requirements under subclause (I) or 

21 (II) of such clause, the Secretary shall— 

22 ‘‘(I) reduce the otherwise applica23 ble resident limit of the hospital by 

24 the amount by which such limit was 

25 increased under this paragraph; and 


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1 ‘‘(II) provide for the distribution 

2 of positions attributable to such re3 duction in accordance with the re4 quirements of this paragraph. 

5 ‘‘(C) CONSIDERATIONS IN REDISTRIBU6 TION.—In determining for which hospitals the 

7 increase in the otherwise applicable resident 

8 limit is provided under subparagraph (B), the 

9 Secretary shall take into account— 

10 ‘‘(i) the demonstration likelihood of 

11 the hospital filling the positions made 

12 available under this paragraph within the 

13 first 3 cost reporting periods beginning on 

14 or after July 1, 2011, as determined by 

15 the Secretary; and 

16 ‘‘(ii) whether the hospital has an ac17 credited rural training track (as described 

18 in paragraph (4)(H)(iv)). 

19 ‘‘(D) PRIORITY FOR CERTAIN AREAS.—In 

20 determining for which hospitals the increase in 

21 the otherwise applicable resident limit is pro22 vided under subparagraph (B), subject to sub23 paragraph (E), the Secretary shall distribute 

24 the increase to hospitals based on the following 

25 factors: 


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1 ‘‘(i) Whether the hospital is located in 

2 a State with a resident-to-population ratio 

3 in the lowest quartile (as determined by 

4 the Secretary). 

5 ‘‘(ii) Whether the hospital is located 

6 in a State, a territory of the United States, 

7 or the District of Columbia that is among 

8 the top 10 States, territories, or Districts 

9 in terms of the ratio of— 

10 ‘‘(I) the total population of the 

11 State, territory, or District living in 

12 an area designated (under such sec13 tion 332(a)(1)(A)) as a health profes14 sional shortage area (as of the date of 

15 enactment of this paragraph); to 

16 ‘‘(II) the total population of the 

17 State, territory, or District (as deter18 mined by the Secretary based on the 

19 most recent available population data 

20 published by the Bureau of the Cen21 sus). 

22 ‘‘(iii) Whether the hospital is located 

23 in a rural area (as defined in subsection 

24 (d)(2)(D)(ii)). 


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1 ‘‘(E) RESERVATION OF POSITIONS FOR

2 CERTAIN HOSPITALS.— 

3 ‘‘(i) IN GENERAL.—Subject to clause 

4 (ii), the Secretary shall reserve the posi5 tions available for distribution under this 

6 paragraph as follows: 

7 ‘‘(I) 70 percent of such positions 

8 for distribution to hospitals described 

9 in clause (i) of subparagraph (D). 

10 ‘‘(II) 30 percent of such positions 

11 for distribution to hospitals described 

12 in clause (ii) and (iii) of such sub13 paragraph. 

14 ‘‘(ii) EXCEPTION IF POSITIONS NOT

15 REDISTRIBUTED BY JULY 1, 2011.—In the 

16 case where the Secretary does not dis17 tribute positions to hospitals in accordance 

18 with clause (i) by July 1, 2011, the Sec19 retary shall distribute such positions to 

20 other hospitals in accordance with the con21 siderations described in subparagraph (C) 

22 and the priority described in subparagraph 

23 (D). 


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1 ‘‘(F) LIMITATION.—A hospital may not re2 ceive more than 75 full-time equivalent addi3 tional residency positions under this paragraph. 

4 ‘‘(G) APPLICATION OF PER RESIDENT

5 AMOUNTS FOR PRIMARY CARE AND NONPRI6 MARY CARE.—With respect to additional resi7 dency positions in a hospital attributable to the 

8 increase provided under this paragraph, the ap9 proved FTE per resident amounts are deemed 

10 to be equal to the hospital per resident amounts 

11 for primary care and nonprimary care com12 puted under paragraph (2)(D) for that hospital. 

13 ‘‘(H) DEFINITIONS.—In this paragraph: 

14 ‘‘(i) REFERENCE RESIDENT LEVEL.— 

15 The term ‘reference resident level’ means, 

16 with respect to a hospital, the highest resi17 dent level for any of the 3 most recent cost 

18 reporting periods (ending before the date 

19 of the enactment of this paragraph) of the 

20 hospital for which a cost report has been 

21 settled (or, if not, submitted (subject to 

22 audit)), as determined by the Secretary. 

23 ‘‘(ii) RESIDENT LEVEL.—The term 

24 ‘resident level’ has the meaning given such 

25 term in paragraph (7)(C)(i). 


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1 ‘‘(iii) OTHERWISE APPLICABLE RESI2 DENT LIMIT.—The term ‘otherwise appli3 cable resident limit’ means, with respect to 

4 a hospital, the limit otherwise applicable 

5 under subparagraphs (F)(i) and (H) of 

6 paragraph (4) on the resident level for the 

7 hospital determined without regard to this 

8 paragraph but taking into account para9 graph (7)(A).’’. 

10 (b) IME.— 

11 (1) IN GENERAL.—Section 1886(d)(5)(B)(v) of 

12 the Social Security Act (42 U.S.C. 

13 1395ww(d)(5)(B)(v)), in the second sentence, is 

14 amended— 

15 (A) by striking ‘‘subsection (h)(7)’’ and in16 serting ‘‘subsections (h)(7) and (h)(8)’’; and 

17 (B) by striking ‘‘it applies’’ and inserting 

18 ‘‘they apply’’. 

19 (2) CONFORMING AMENDMENT.—Section 

20 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 

21 1395ww(d)(5)(B)) is amended by adding at the end 

22 the following clause: 

23 ‘‘(x) For discharges occurring on or after July 

24 1, 2011, insofar as an additional payment amount 

25 under this subparagraph is attributable to resident 


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1 positions distributed to a hospital under subsection 

2 (h)(8)(B), the indirect teaching adjustment factor 

3 shall be computed in the same manner as provided 

4 under clause (ii) with respect to such resident posi5 tions.’’. 

6 (c) CONFORMING AMENDMENT.—Section 422(b)(2) 

7 of the Medicare Prescription Drug, Improvement, and 

8 Modernization Act of 2003 (Public Law 108–173) is 

9 amended by striking ‘‘section 1886(h)(7)’’ and all that fol10 lows and inserting ‘‘paragraphs (7) and (8) of subsection 

11 (h) of section 1886 of the Social Security Act’’. 

12 SEC. 5504. COUNTING RESIDENT TIME IN NONPROVIDER 

13 SETTINGS. 

14 (a) GME.—Section 1886(h)(4)(E) of the Social Se15 curity Act (42 U.S.C. 1395ww(h)(4)(E)) is amended— 

16 (1) by striking ‘‘shall be counted and that all 

17 the time’’ and inserting ‘‘shall be counted and 

18 that— 

19 ‘‘(i) effective for cost reporting peri20 ods beginning before July 1, 2010, all the 

21 time;’’; 

22 (2) in clause (i), as inserted by paragraph (1), 

23 by striking the period at the end and inserting ‘‘; 

24 and’’; 


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1 (3) by inserting after clause (i), as so inserted, 

2 the following new clause: 

3 ‘‘(ii) effective for cost reporting peri4 ods beginning on or after July 1, 2010, all 

5 the time so spent by a resident shall be 

6 counted towards the determination of full7 time equivalency, without regard to the 

8 setting in which the activities are per9 formed, if a hospital incurs the costs of the 

10 stipends and fringe benefits of the resident 

11 during the time the resident spends in that 

12 setting. If more than one hospital incurs 

13 these costs, either directly or through a 

14 third party, such hospitals shall count a 

15 proportional share of the time, as deter16 mined by written agreement between the 

17 hospitals, that a resident spends training 

18 in that setting.’’; and 

19 (4) by adding at the end the following flush 

20 sentence: 

21 ‘‘Any hospital claiming under this subpara22 graph for time spent in a nonprovider setting 

23 shall maintain and make available to the Sec24 retary records regarding the amount of such 

25 time and such amount in comparison with 


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1 amounts of such time in such base year as the 

2 Secretary shall specify.’’. 

3 (b) IME.—Section 1886(d)(5)(B)(iv) of the Social 

4 Security Act (42 U.S.C. 1395ww(d)(5)) is amended— 

5 (1) by striking ‘‘(iv) Effective for discharges oc6 curring on or after October 1, 1997’’ and inserting 

7 ‘‘(iv)(I) Effective for discharges occurring on or 

8 after October 1, 1997, and before July 1, 2010’’; 

9 and 

10 (2) by inserting after clause (I), as inserted by 

11 paragraph (1), the following new subparagraph: 

12 ‘‘(II) Effective for discharges occurring on or 

13 after July 1, 2010, all the time spent by an intern 

14 or resident in patient care activities in a nonprovider 

15 setting shall be counted towards the determination 

16 of full-time equivalency if a hospital incurs the costs 

17 of the stipends and fringe benefits of the intern or 

18 resident during the time the intern or resident 

19 spends in that setting. If more than one hospital in20 curs these costs, either directly or through a third 

21 party, such hospitals shall count a proportional 

22 share of the time, as determined by written agree23 ment between the hospitals, that a resident spends 

24 training in that setting.’’. 


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1 (c) APPLICATION.—The amendments made by this 

2 section shall not be applied in a manner that requires re3 opening of any settled hospital cost reports as to which 

4 there is not a jurisdictionally proper appeal pending as 

5 of the date of the enactment of this Act on the issue of 

6 payment for indirect costs of medical education under sec7 tion 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 

8 1395ww(d)(5)(B)) or for direct graduate medical edu9 cation costs under section 1886(h) of such Act (42 U.S.C. 

10 1395ww(h)). 

11 SEC. 5505. RULES FOR COUNTING RESIDENT TIME FOR DI12 DACTIC AND SCHOLARLY ACTIVITIES AND 

13 OTHER ACTIVITIES. 

14 (a) GME.—Section 1886(h) of the Social Security 

15 Act (42 U.S.C. 1395ww(h)), as amended by section 5504, 

16 is amended— 

17 (1) in paragraph (4)— 

18 (A) in subparagraph (E), by striking 

19 ‘‘Such rules’’ and inserting ‘‘Subject to sub20 paragraphs (J) and (K), such rules’’; and 

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

22 subparagraphs: 

23 ‘‘(J) TREATMENT OF CERTAIN NONPRO24 VIDER AND DIDACTIC ACTIVITIES.—Such rules 

25 shall provide that all time spent by an intern or 


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1 resident in an approved medical residency train2 ing program in a nonprovider setting that is 

3 primarily engaged in furnishing patient care (as 

4 defined in paragraph (5)(K)) in non-patient 

5 care activities, such as didactic conferences and 

6 seminars, but not including research not associ7 ated with the treatment or diagnosis of a par8 ticular patient, as such time and activities are 

9 defined by the Secretary, shall be counted to10 ward the determination of full-time equivalency. 

11 ‘‘(K) TREATMENT OF CERTAIN OTHER AC12 TIVITIES.—In determining the hospital’s num13 ber of full-time equivalent residents for pur14 poses of this subsection, all the time that is 

15 spent by an intern or resident in an approved 

16 medical residency training program on vacation, 

17 sick leave, or other approved leave, as such time 

18 is defined by the Secretary, and that does not 

19 prolong the total time the resident is partici20 pating in the approved program beyond the nor21 mal duration of the program shall be counted 

22 toward the determination of full-time equiva23 lency.’’; and 

24 (2) in paragraph (5), by adding at the end the 

25 following new subparagraph: 


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1 ‘‘(K) NONPROVIDER SETTING THAT IS PRI2 MARILY ENGAGED IN FURNISHING PATIENT

3 CARE.—The term ‘nonprovider setting that is 

4 primarily engaged in furnishing patient care’ 

5 means a nonprovider setting in which the pri6 mary activity is the care and treatment of pa7 tients, as defined by the Secretary.’’. 

8 (b) IME DETERMINATIONS.—Section 1886(d)(5)(B) 

9 of such Act (42 U.S.C. 1395ww(d)(5)(B)) is amended by 

10 adding at the end the following new clause: 

11 ‘‘(x)(I) The provisions of subpara12 graph (K) of subsection (h)(4) shall apply 

13 under this subparagraph in the same man14 ner as they apply under such subsection. 

15 ‘‘(II) In determining the hospital’s 

16 number of full-time equivalent residents 

17 for purposes of this subparagraph, all the 

18 time spent by an intern or resident in an 

19 approved medical residency training pro20 gram in non-patient care activities, such as 

21 didactic conferences and seminars, as such 

22 time and activities are defined by the Sec23 retary, that occurs in the hospital shall be 

24 counted toward the determination of full25 time equivalency if the hospital— 


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1 ‘‘(aa) is recognized as a sub2 section (d) hospital; 

3 ‘‘(bb) is recognized as a sub4 section (d) Puerto Rico hospital; 

5 ‘‘(cc) is reimbursed under a reim6 bursement system authorized under 

7 section 1814(b)(3); or 

8 ‘‘(dd) is a provider-based hospital 

9 outpatient department. 

10 ‘‘(III) In determining the hospital’s 

11 number of full-time equivalent residents 

12 for purposes of this subparagraph, all the 

13 time spent by an intern or resident in an 

14 approved medical residency training pro15 gram in research activities that are not as16 sociated with the treatment or diagnosis of 

17 a particular patient, as such time and ac18 tivities are defined by the Secretary, shall 

19 not be counted toward the determination of 

20 full-time equivalency.’’. 

21 (c) EFFECTIVE DATES.— 

22 (1) IN GENERAL.—Except as otherwise pro23 vided, the Secretary of Health and Human Services 

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1 tion in a manner so as to apply to cost reporting pe2 riods beginning on or after January 1, 1983. 

3 (2) GME.—Section 1886(h)(4)(J) of the Social 

4 Security Act, as added by subsection (a)(1)(B), shall 

5 apply to cost reporting periods beginning on or after 

6 July 1, 2009. 

7 (3) IME.—Section 1886(d)(5)(B)(x)(III) of the 

8 Social Security Act, as added by subsection (b), shall 

9 apply to cost reporting periods beginning on or after 

10 October 1, 2001. Such section, as so added, shall 

11 not give rise to any inference as to how the law in 

12 effect prior to such date should be interpreted. 

13 SEC. 5506. PRESERVATION OF RESIDENT CAP POSITIONS 

14 FROM CLOSED HOSPITALS. 

15 (a) GME.—Section 1886(h)(4)(H) of the Social Se16 curity Act (42 U.S.C. Section 1395ww(h)(4)(H)) is 

17 amended by adding at the end the following new clause: 

18 ‘‘(vi) REDISTRIBUTION OF RESIDENCY

19 SLOTS AFTER A HOSPITAL CLOSES.— 

20 ‘‘(I) IN GENERAL.—Subject to 

21 the succeeding provisions of this 

22 clause, the Secretary shall, by regula23 tion, establish a process under which, 

24 in the case where a hospital (other 

25 than a hospital described in clause 


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1 (v)) with an approved medical resi2 dency program closes on or after a 

3 date that is 2 years before the date of 

4 enactment of this clause, the Sec5 retary shall increase the otherwise ap6 plicable resident limit under this para7 graph for other hospitals in accord8 ance with this clause. 

9 ‘‘(II) PRIORITY FOR HOSPITALS

10 IN CERTAIN AREAS.—Subject to the 

11 succeeding provisions of this clause, in 

12 determining for which hospitals the 

13 increase in the otherwise applicable 

14 resident limit is provided under such 

15 process, the Secretary shall distribute 

16 the increase to hospitals in the fol17 lowing priority order (with preference 

18 given within each category to hos19 pitals that are members of the same 

20 affiliated group (as defined by the 

21 Secretary under clause (ii)) as the 

22 closed hospital): 

23 ‘‘(aa) First, to hospitals lo24 cated in the same core-based sta25 tistical area as, or a core-based 


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1 statistical area contiguous to, the 

2 hospital that closed. 

3 ‘‘(bb) Second, to hospitals 

4 located in the same State as the 

5 hospital that closed. 

6 ‘‘(cc) Third, to hospitals lo7 cated in the same region of the 

8 country as the hospital that 

9 closed. 

10 ‘‘(dd) Fourth, only if the 

11 Secretary is not able to distribute 

12 the increase to hospitals de13 scribed in item (cc), to qualifying 

14 hospitals in accordance with the 

15 provisions of paragraph (8). 

16 ‘‘(III) REQUIREMENT HOSPITAL

17 LIKELY TO FILL POSITION WITHIN

18 CERTAIN TIME PERIOD.—The Sec19 retary may only increase the otherwise 

20 applicable resident limit of a hospital 

21 under such process if the Secretary 

22 determines the hospital has dem23 onstrated a likelihood of filling the po24 sitions made available under this 

25 clause within 3 years. 


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1 ‘‘(IV) LIMITATION.—The aggre2 gate number of increases in the other3 wise applicable resident limits for hos4 pitals under this clause shall be equal 

5 to the number of resident positions in 

6 the approved medical residency pro7 grams that closed on or after the date 

8 described in subclause (I). 

9 ‘‘(V) ADMINISTRATION.—Chapter 

10 35 of title 44, United States Code, 

11 shall not apply to the implementation 

12 of this clause.’’. 

13 (b) IME.—Section 1886(d)(5)(B)(v) of the Social Se14 curity Act (42 U.S.C. 1395ww(d)(5)(B)(v)), in the second 

15 sentence, as amended by section 5503, is amended by 

16 striking ‘‘subsections (h)(7) and (h)(8)’’ and inserting 

17 ‘‘subsections (h)(4)(H)(vi), (h)(7), and (h)(8)’’. 

18 (c) APPLICATION.—The amendments made by this 

19 section shall not be applied in a manner that requires re20 opening of any settled hospital cost reports as to which 

21 there is not a jurisdictionally proper appeal pending as 

22 of the date of the enactment of this Act on the issue of 

23 payment for indirect costs of medical education under sec24 tion 1886(d)(5)(B) of the Social Security Act (42 U.S.C. 

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1 cation costs under section 1886(h) of such Act (42 U.S.C. 

2 Section 1395ww(h)). 

3 (d) EFFECT ON TEMPORARY FTE CAP ADJUST4 MENTS.—The Secretary of Health and Human Services 

5 shall give consideration to the effect of the amendments 

6 made by this section on any temporary adjustment to a 

7 hospital’s FTE cap under section 413.79(h) of title 42, 

8 Code of Federal Regulations (as in effect on the date of 

9 enactment of this Act) in order to ensure that there is 

10 no duplication of FTE slots. Such amendments shall not 

11 affect the application of section 1886(h)(4)(H)(v) of the 

12 Social Security Act (42 U.S.C. 1395ww(h)(4)(H)(v)). 

13 (e) CONFORMING AMENDMENT.—Section 

14 1886(h)(7)(E) of the Social Security Act (42 U.S.C. 

15 1395ww(h)(7)(E)), as amended by section 5503(a), is 

16 amended by striking ‘‘paragraph or paragraph (8)’’ and 

17 inserting ‘‘this paragraph, paragraph (8), or paragraph 

18 (4)(H)(vi)’’. 

19 SEC. 5507. DEMONSTRATION PROJECTS TO ADDRESS 

20 HEALTH PROFESSIONS WORKFORCE NEEDS; 

21 EXTENSION OF FAMILY-TO-FAMILY HEALTH 

22 INFORMATION CENTERS. 

23 (a) AUTHORITY TO CONDUCT DEMONSTRATION

24 PROJECTS.—Title XX of the Social Security Act (42 


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1 U.S.C. 1397 et seq.) is amended by adding at the end 

2 the following: 

3 ‘‘SEC. 2008. DEMONSTRATION PROJECTS TO ADDRESS 

4 HEALTH PROFESSIONS WORKFORCE NEEDS. 

5 ‘‘(a) DEMONSTRATION PROJECTS TO PROVIDE LOW6 INCOME INDIVIDUALS WITH OPPORTUNITIES FOR EDU7 CATION, TRAINING, AND CAREER ADVANCEMENT TO AD8 DRESS HEALTH PROFESSIONS WORKFORCE NEEDS.— 

9 ‘‘(1) AUTHORITY TO AWARD GRANTS.—The 

10 Secretary, in consultation with the Secretary of 

11 Labor, shall award grants to eligible entities to con12 duct demonstration projects that are designed to 

13 provide eligible individuals with the opportunity to 

14 obtain education and training for occupations in the 

15 health care field that pay well and are expected to 

16 either experience labor shortages or be in high de17 mand. 

18 ‘‘(2) REQUIREMENTS.— 

19 ‘‘(A) AID AND SUPPORTIVE SERVICES.— 

20 ‘‘(i) IN GENERAL.—A demonstration 

21 project conducted by an eligible entity 

22 awarded a grant under this section shall, if 

23 appropriate, provide eligible individuals 

24 participating in the project with financial 


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1 aid, child care, case management, and 

2 other supportive services. 

3 ‘‘(ii) TREATMENT.—Any aid, services, 

4 or incentives provided to an eligible bene5 ficiary participating in a demonstration 

6 project under this section shall not be con7 sidered income, and shall not be taken into 

8 account for purposes of determining the in9 dividual’s eligibility for, or amount of, ben10 efits under any means-tested program. 

11 ‘‘(B) CONSULTATION AND COORDINA12 TION.—An eligible entity applying for a grant 

13 to carry out a demonstration project under this 

14 section shall demonstrate in the application that 

15 the entity has consulted with the State agency 

16 responsible for administering the State TANF 

17 program, the local workforce investment board 

18 in the area in which the project is to be con19 ducted (unless the applicant is such board), the 

20 State workforce investment board established 

21 under section 111 of the Workforce Investment 

22 Act of 1998, and the State Apprenticeship 

23 Agency recognized under the Act of August 16, 

24 1937 (commonly known as the ‘National Ap25 prenticeship Act’) (or if no agency has been recVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01471 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ognized in the State, the Office of Apprentice2 ship of the Department of Labor) and that the 

3 project will be carried out in coordination with 

4 such entities. 

5 ‘‘(C) ASSURANCE OF OPPORTUNITIES FOR

6 INDIAN POPULATIONS.—The Secretary shall 

7 award at least 3 grants under this subsection to 

8 an eligible entity that is an Indian tribe, tribal 

9 organization, or Tribal College or University. 

10 ‘‘(3) REPORTS AND EVALUATION.— 

11 ‘‘(A) ELIGIBLE ENTITIES.—An eligible en12 tity awarded a grant to conduct a demonstra13 tion project under this subsection shall submit 

14 interim reports to the Secretary on the activi15 ties carried out under the project and a final 

16 report on such activities upon the conclusion of 

17 the entities’ participation in the project. Such 

18 reports shall include assessments of the effec19 tiveness of such activities with respect to im20 proving outcomes for the eligible individuals 

21 participating in the project and with respect to 

22 addressing health professions workforce needs 

23 in the areas in which the project is conducted. 

24 ‘‘(B) EVALUATION.—The Secretary shall, 

25 by grant, contract, or interagency agreement, 


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1 evaluate the demonstration projects conducted 

2 under this subsection. Such evaluation shall in3 clude identification of successful activities for 

4 creating opportunities for developing and sus5 taining, particularly with respect to low-income 

6 individuals and other entry-level workers, a 

7 health professions workforce that has accessible 

8 entry points, that meets high standards for edu9 cation, training, certification, and professional 

10 development, and that provides increased wages 

11 and affordable benefits, including health care 

12 coverage, that are responsive to the workforce’s 

13 needs. 

14 ‘‘(C) REPORT TO CONGRESS.—The Sec15 retary shall submit interim reports and, based 

16 on the evaluation conducted under subpara17 graph (B), a final report to Congress on the 

18 demonstration projects conducted under this 

19 subsection. 

20 ‘‘(4) DEFINITIONS.—In this subsection: 

21 ‘‘(A) ELIGIBLE ENTITY.—The term ‘eligi22 ble entity’ means a State, an Indian tribe or 

23 tribal organization, an institution of higher edu24 cation, a local workforce investment board es25 tablished under section 117 of the Workforce 


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1 Investment Act of 1998, a sponsor of an ap2 prenticeship program registered under the Na3 tional Apprenticeship Act or a community-based 

4 organization. 

5 ‘‘(B) ELIGIBLE INDIVIDUAL.— 

6 ‘‘(i) IN GENERAL.—The term ‘eligible 

7 individual’ means a individual receiving as8 sistance under the State TANF program. 

9 ‘‘(ii) OTHER LOW-INCOME INDIVID10 UALS.—Such term may include other low11 income individuals described by the eligible 

12 entity in its application for a grant under 

13 this section. 

14 ‘‘(C) INDIAN TRIBE; TRIBAL ORGANIZA15 TION.—The terms ‘Indian tribe’ and ‘tribal or16 ganization’ have the meaning given such terms 

17 in section 4 of the Indian Self-Determination 

18 and Education Assistance Act (25 U.S.C. 

19 450b). 

20 ‘‘(D) INSTITUTION OF HIGHER EDU21 CATION.—The term ‘institution of higher edu22 cation’ has the meaning given that term in sec23 tion 101 of the Higher Education Act of 1965 

24 (20 U.S.C. 1001). 


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1 ‘‘(E) STATE.—The term ‘State’ means 

2 each of the 50 States, the District of Columbia, 

3 the Commonwealth of Puerto Rico, the United 

4 States Virgin Islands, Guam, and American 

5 Samoa. 

6 ‘‘(F) STATE TANF PROGRAM.—The term 

7 ‘State TANF program’ means the temporary 

8 assistance for needy families program funded 

9 under part A of title IV. 

10 ‘‘(G) TRIBAL COLLEGE OR UNIVERSITY.— 

11 The term ‘Tribal College or University’ has the 

12 meaning given that term in section 316(b) of 

13 the Higher Education Act of 1965 (20 U.S.C. 

14 1059c(b)). 

15 ‘‘(b) DEMONSTRATION PROJECT TO DEVELOP

16 TRAINING AND CERTIFICATION PROGRAMS FOR PER17 SONAL OR HOME CARE AIDES.— 

18 ‘‘(1) AUTHORITY TO AWARD GRANTS.—Not 

19 later than 18 months after the date of enactment of 

20 this section, the Secretary shall award grants to eli21 gible entities that are States to conduct demonstra22 tion projects for purposes of developing core training 

23 competencies and certification programs for personal 

24 or home care aides. The Secretary shall— 


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1 ‘‘(A) evaluate the efficacy of the core train2 ing competencies described in paragraph (3)(A) 

3 for newly hired personal or home care aides and 

4 the methods used by States to implement such 

5 core training competencies in accordance with 

6 the issues specified in paragraph (3)(B); and 

7 ‘‘(B) ensure that the number of hours of 

8 training provided by States under the dem9 onstration project with respect to such core 

10 training competencies are not less than the 

11 number of hours of training required under any 

12 applicable State or Federal law or regulation. 

13 ‘‘(2) DURATION.—A demonstration project shall 

14 be conducted under this subsection for not less than 

15 3 years. 

16 ‘‘(3) CORE TRAINING COMPETENCIES FOR PER17 SONAL OR HOME CARE AIDES.— 

18 ‘‘(A) IN GENERAL.—The core training 

19 competencies for personal or home care aides 

20 described in this subparagraph include com21 petencies with respect to the following areas: 

22 ‘‘(i) The role of the personal or home 

23 care aide (including differences between a 

24 personal or home care aide employed by an 

25 agency and a personal or home care aide 


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1 employed directly by the health care con2 sumer or an independent provider). 

3 ‘‘(ii) Consumer rights, ethics, and 

4 confidentiality (including the role of proxy 

5 decision-makers in the case where a health 

6 care consumer has impaired decision-mak7 ing capacity). 

8 ‘‘(iii) Communication, cultural and 

9 linguistic competence and sensitivity, prob10 lem solving, behavior management, and re11 lationship skills. 

12 ‘‘(iv) Personal care skills. 

13 ‘‘(v) Health care support. 

14 ‘‘(vi) Nutritional support. 

15 ‘‘(vii) Infection control. 

16 ‘‘(viii) Safety and emergency training. 

17 ‘‘(ix) Training specific to an indi18 vidual consumer’s needs (including older 

19 individuals, younger individuals with dis20 abilities, individuals with developmental 

21 disabilities, individuals with dementia, and 

22 individuals with mental and behavioral 

23 health needs). 

24 ‘‘(x) Self-Care. 


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1 ‘‘(B) IMPLEMENTATION.—The implemen2 tation issues specified in this subparagraph in3 clude the following: 

4 ‘‘(i) The length of the training. 

5 ‘‘(ii) The appropriate trainer to stu6 dent ratio. 

7 ‘‘(iii) The amount of instruction time 

8 spent in the classroom as compared to on9 site in the home or a facility. 

10 ‘‘(iv) Trainer qualifications. 

11 ‘‘(v) Content for a ‘hands-on’ and 

12 written certification exam. 

13 ‘‘(vi) Continuing education require14 ments. 

15 ‘‘(4) APPLICATION AND SELECTION CRI16 TERIA.— 

17 ‘‘(A) IN GENERAL.— 

18 ‘‘(i) NUMBER OF STATES.—The Sec19 retary shall enter into agreements with not 

20 more than 6 States to conduct demonstra21 tion projects under this subsection. 

22 ‘‘(ii) REQUIREMENTS FOR STATES.— 

23 An agreement entered into under clause (i) 

24 shall require that a participating State— 


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1 ‘‘(I) implement the core training 

2 competencies described in paragraph 

3 (3)(A); and 

4 ‘‘(II) develop written materials 

5 and protocols for such core training 

6 competencies, including the develop7 ment of a certification test for per8 sonal or home care aides who have 

9 completed such training competencies. 

10 ‘‘(iii) CONSULTATION AND COLLABO11 RATION WITH COMMUNITY AND VOCA12 TIONAL COLLEGES.—The Secretary shall 

13 encourage participating States to consult 

14 with community and vocational colleges re15 garding the development of curricula to 

16 implement the project with respect to ac17 tivities, as applicable, which may include 

18 consideration of such colleges as partners 

19 in such implementation. 

20 ‘‘(B) APPLICATION AND ELIGIBILITY.—A 

21 State seeking to participate in the project 

22 shall— 

23 ‘‘(i) submit an application to the Sec24 retary containing such information and at 

25 such time as the Secretary may specify; 


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1 ‘‘(ii) meet the selection criteria estab2 lished under subparagraph (C); and 

3 ‘‘(iii) meet such additional criteria as 

4 the Secretary may specify. 

5 ‘‘(C) SELECTION CRITERIA.—In selecting 

6 States to participate in the program, the Sec7 retary shall establish criteria to ensure (if appli8 cable with respect to the activities involved)— 

9 ‘‘(i) geographic and demographic di10 versity; 

11 ‘‘(ii) that participating States offer 

12 medical assistance for personal care serv13 ices under the State Medicaid plan; 

14 ‘‘(iii) that the existing training stand15 ards for personal or home care aides in 

16 each participating State— 

17 ‘‘(I) are different from such 

18 standards in the other participating 

19 States; and 

20 ‘‘(II) are different from the core 

21 training competencies described in 

22 paragraph (3)(A); 

23 ‘‘(iv) that participating States do not 

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1 lation after being selected to participate in 

2 the project; and 

3 ‘‘(v) that participating States recruit 

4 a minimum number of eligible health and 

5 long-term care providers to participate in 

6 the project. 

7 ‘‘(D) TECHNICAL ASSISTANCE.—The Sec8 retary shall provide technical assistance to 

9 States in developing written materials and pro10 tocols for such core training competencies. 

11 ‘‘(5) EVALUATION AND REPORT.— 

12 ‘‘(A) EVALUATION.—The Secretary shall 

13 develop an experimental or control group test14 ing protocol in consultation with an inde15 pendent evaluation contractor selected by the 

16 Secretary. Such contractor shall evaluate— 

17 ‘‘(i) the impact of core training com18 petencies described in paragraph (3)(A), 

19 including curricula developed to implement 

20 such core training competencies, for per21 sonal or home care aides within each par22 ticipating State on job satisfaction, mas23 tery of job skills, beneficiary and family 

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1 retary in consultation with the expert 

2 panel; 

3 ‘‘(ii) the impact of providing such core 

4 training competencies on the existing 

5 training infrastructure and resources of 

6 States; and 

7 ‘‘(iii) whether a minimum number of 

8 hours of initial training should be required 

9 for personal or home care aides and, if so, 

10 what minimum number of hours should be 

11 required. 

12 ‘‘(B) REPORTS.— 

13 ‘‘(i) REPORT ON INITIAL IMPLEMEN14 TATION.—Not later than 2 years after the 

15 date of enactment of this section, the Sec16 retary shall submit to Congress a report on 

17 the initial implementation of activities con18 ducted under the demonstration project, 

19 including any available results of the eval20 uation conducted under subparagraph (A) 

21 with respect to such activities, together 

22 with such recommendations for legislation 

23 or administrative action as the Secretary 

24 determines appropriate. 


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1 ‘‘(ii) FINAL REPORT.—Not later than 

2 1 year after the completion of the dem3 onstration project, the Secretary shall sub4 mit to Congress a report containing the re5 sults of the evaluation conducted under 

6 subparagraph (A), together with such rec7 ommendations for legislation or adminis8 trative action as the Secretary determines 

9 appropriate. 

10 ‘‘(6) DEFINITIONS.—In this subsection: 

11 ‘‘(A) ELIGIBLE HEALTH AND LONG-TERM

12 CARE PROVIDER.—The term ‘eligible health and 

13 long-term care provider’ means a personal or 

14 home care agency (including personal or home 

15 care public authorities), a nursing home, a 

16 home health agency (as defined in section 

17 1861(o)), or any other health care provider the 

18 Secretary determines appropriate which— 

19 ‘‘(i) is licensed or authorized to pro20 vide services in a participating State; and 

21 ‘‘(ii) receives payment for services 

22 under title XIX. 

23 ‘‘(B) PERSONAL CARE SERVICES.—The 

24 term ‘personal care services’ has the meaning 

25 given such term for purposes of title XIX. 


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1 ‘‘(C) PERSONAL OR HOME CARE AIDE.— 

2 The term ‘personal or home care aide’ means 

3 an individual who helps individuals who are el4 derly, disabled, ill, or mentally disabled (includ5 ing an individual with Alzheimer’s disease or 

6 other dementia) to live in their own home or a 

7 residential care facility (such as a nursing 

8 home, assisted living facility, or any other facil9 ity the Secretary determines appropriate) by 

10 providing routine personal care services and 

11 other appropriate services to the individual. 

12 ‘‘(D) STATE.—The term ‘State’ has the 

13 meaning given that term for purposes of title 

14 XIX. 

15 ‘‘(c) FUNDING.— 

16 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

17 out of any funds in the Treasury not otherwise ap18 propriated, there are appropriated to the Secretary 

19 to carry out subsections (a) and (b), $85,000,000 

20 for each of fiscal years 2010 through 2014. 

21 ‘‘(2) TRAINING AND CERTIFICATION PROGRAMS

22 FOR PERSONAL AND HOME CARE AIDES.—With re23 spect to the demonstration projects under subsection 

24 (b), the Secretary shall use $5,000,000 of the 

25 amount appropriated under paragraph (1) for each 


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1 of fiscal years 2010 through 2012 to carry out such 

2 projects. No funds appropriated under paragraph 

3 (1) shall be used to carry out demonstration projects 

4 under subsection (b) after fiscal year 2012. 

5 ‘‘(d) NONAPPLICATION.— 

6 ‘‘(1) IN GENERAL.—Except as provided in para7 graph (2), the preceding sections of this title shall 

8 not apply to grant awarded under this section. 

9 ‘‘(2) LIMITATIONS ON USE OF GRANTS.—Sec10 tion 2005(a) (other than paragraph (6)) shall apply 

11 to a grant awarded under this section to the same 

12 extent and in the same manner as such section ap13 plies to payments to States under this title.’’. 

14 (b) EXTENSION OF FAMILY-TO-FAMILY HEALTH IN15 FORMATION CENTERS.—Section 501(c)(1)(A)(iii) of the 

16 Social Security Act (42 U.S.C. 701(c)(1)(A)(iii)) is 

17 amended by striking ‘‘fiscal year 2009’’ and inserting 

18 ‘‘each of fiscal years 2009 through 2012’’. 

19 SEC. 5508. INCREASING TEACHING CAPACITY. 

20 (a) TEACHING HEALTH CENTERS TRAINING AND

21 ENHANCEMENT.—Part C of title VII of the Public Health 

22 Service Act (42 U.S.C. 293k et. seq.), as amended by sec23 tion 5303, is further amended by inserting after section 

24 749 the following: 


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1 ‘‘SEC. 749A. TEACHING HEALTH CENTERS DEVELOPMENT 

2 GRANTS. 

3 ‘‘(a) PROGRAM AUTHORIZED.—The Secretary may 

4 award grants under this section to teaching health centers 

5 for the purpose of establishing new accredited or expanded 

6 primary care residency programs. 

7 ‘‘(b) AMOUNT AND DURATION.—Grants awarded 

8 under this section shall be for a term of not more than 

9 3 years and the maximum award may not be more than 

10 $500,000. 

11 ‘‘(c) USE OF FUNDS.—Amounts provided under a 

12 grant under this section shall be used to cover the costs 

13 of— 

14 ‘‘(1) establishing or expanding a primary care 

15 residency training program described in subsection 

16 (a), including costs associated with— 

17 ‘‘(A) curriculum development; 

18 ‘‘(B) recruitment, training and retention of 

19 residents and faculty: 

20 ‘‘(C) accreditation by the Accreditation 

21 Council for Graduate Medical Education 

22 (ACGME), the American Dental Association 

23 (ADA), or the American Osteopathic Associa24 tion (AOA); and 

25 ‘‘(D) faculty salaries during the develop26 ment phase; and 


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1 ‘‘(2) technical assistance provided by an eligible 

2 entity. 

3 ‘‘(d) APPLICATION.—A teaching health center seek4 ing a grant under this section shall submit an application 

5 to the Secretary at such time, in such manner, and con6 taining such information as the Secretary may require. 

7 ‘‘(e) PREFERENCE FOR CERTAIN APPLICATIONS.—In 

8 selecting recipients for grants under this section, the Sec9 retary shall give preference to any such application that 

10 documents an existing affiliation agreement with an area 

11 health education center program as defined in sections 

12 751 and 799B. 

13 ‘‘(f) DEFINITIONS.—In this section: 

14 ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en15 tity’ means an organization capable of providing 

16 technical assistance including an area health edu17 cation center program as defined in sections 751 

18 and 799B. 

19 ‘‘(2) PRIMARY CARE RESIDENCY PROGRAM.— 

20 The term ‘primary care residency program’ means 

21 an approved graduate medical residency training 

22 program (as defined in section 340H) in family med23 icine, internal medicine, pediatrics, internal medi24 cine-pediatrics, obstetrics and gynecology, psychiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01487 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 atry, general dentistry, pediatric dentistry, and geri2 atrics. 

3 ‘‘(3) TEACHING HEALTH CENTER.— 

4 ‘‘(A) IN GENERAL.—The term ‘teaching 

5 health center’ means an entity that— 

6 ‘‘(i) is a community based, ambula7 tory patient care center; and 

8 ‘‘(ii) operates a primary care resi9 dency program. 

10 ‘‘(B) INCLUSION OF CERTAIN ENTITIES.— 

11 Such term includes the following: 

12 ‘‘(i) A Federally qualified health cen13 ter (as defined in section 1905(l)(2)(B), of 

14 the Social Security Act). 

15 ‘‘(ii) A community mental health cen16 ter (as defined in section 1861(ff)(3)(B) of 

17 the Social Security Act). 

18 ‘‘(iii) A rural health clinic, as defined 

19 in section 1861(aa) of the Social Security 

20 Act. 

21 ‘‘(iv) A health center operated by the 

22 Indian Health Service, an Indian tribe or 

23 tribal organization, or an urban Indian or24 ganization (as defined in section 4 of the 

25 Indian Health Care Improvement Act). 


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1 ‘‘(v) An entity receiving funds under 

2 title X of the Public Health Service Act. 

3 ‘‘(g) AUTHORIZATION OF APPROPRIATIONS.—There 

4 is authorized to be appropriated, $25,000,000 for fiscal 

5 year 2010, $50,000,000 for fiscal year 2011, $50,000,000 

6 for fiscal year 2012, and such sums as may be necessary 

7 for each fiscal year thereafter to carry out this section. 

8 Not to exceed $5,000,000 annually may be used for tech9 nical assistance program grants.’’. 

10 (b) NATIONAL HEALTH SERVICE CORPS TEACHING

11 CAPACITY.—Section 338C(a) of the Public Health Service 

12 Act (42 U.S.C. 254m(a)) is amended to read as follows: 

13 ‘‘(a) SERVICE IN FULL-TIME CLINICAL PRACTICE.— 

14 Except as provided in section 338D, each individual who 

15 has entered into a written contract with the Secretary 

16 under section 338A or 338B shall provide service in the 

17 full-time clinical practice of such individual’s profession as 

18 a member of the Corps for the period of obligated service 

19 provided in such contract. For the purpose of calculating 

20 time spent in full-time clinical practice under this sub21 section, up to 50 percent of time spent teaching by a mem22 ber of the Corps may be counted toward his or her service 

23 obligation.’’. 

24 (c) PAYMENTS TO QUALIFIED TEACHING HEALTH

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1 ice Act (42 U.S.C. 254b et seq.) is amended by adding 

2 at the end the following: 

3 ‘‘Subpart XI—Support of Graduate Medical 

4 Education in Qualified Teaching Health Centers 

5 ‘‘SEC. 340H. PROGRAM OF PAYMENTS TO TEACHING 

6 HEALTH CENTERS THAT OPERATE GRAD7 UATE MEDICAL EDUCATION PROGRAMS. 

8 ‘‘(a) PAYMENTS.—Subject to subsection (h)(2), the 

9 Secretary shall make payments under this section for di10 rect expenses and for indirect expenses to qualified teach11 ing health centers that are listed as sponsoring institutions 

12 by the relevant accrediting body for expansion of existing 

13 or establishment of new approved graduate medical resi14 dency training programs. 

15 ‘‘(b) AMOUNT OF PAYMENTS.— 

16 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

17 the amounts payable under this section to qualified 

18 teaching health centers for an approved graduate 

19 medical residency training program for a fiscal year 

20 are each of the following amounts: 

21 ‘‘(A) DIRECT EXPENSE AMOUNT.—The 

22 amount determined under subsection (c) for di23 rect expenses associated with sponsoring ap24 proved graduate medical residency training pro25 grams. 


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1 ‘‘(B) INDIRECT EXPENSE AMOUNT.—The 

2 amount determined under subsection (d) for in3 direct expenses associated with the additional 

4 costs relating to teaching residents in such pro5 grams. 

6 ‘‘(2) CAPPED AMOUNT.— 

7 ‘‘(A) IN GENERAL.—The total of the pay8 ments made to qualified teaching health centers 

9 under paragraph (1)(A) or paragraph (1)(B) in 

10 a fiscal year shall not exceed the amount of 

11 funds appropriated under subsection (g) for 

12 such payments for that fiscal year. 

13 ‘‘(B) LIMITATION.—The Secretary shall 

14 limit the funding of full-time equivalent resi15 dents in order to ensure the direct and indirect 

16 payments as determined under subsection (c) 

17 and (d) do not exceed the total amount of funds 

18 appropriated in a fiscal year under subsection 

19 (g). 

20 ‘‘(c) AMOUNT OF PAYMENT FOR DIRECT GRADUATE

21 MEDICAL EDUCATION.— 

22 ‘‘(1) IN GENERAL.—The amount determined 

23 under this subsection for payments to qualified 

24 teaching health centers for direct graduate expenses 

25 relating to approved graduate medical residency 


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1 training programs for a fiscal year is equal to the 

2 product of— 

3 ‘‘(A) the updated national per resident 

4 amount for direct graduate medical education, 

5 as determined under paragraph (2); and 

6 ‘‘(B) the average number of full-time 

7 equivalent residents in the teaching health cen8 ter’s graduate approved medical residency train9 ing programs as determined under section 

10 1886(h)(4) of the Social Security Act (without 

11 regard to the limitation under subparagraph 

12 (F) of such section) during the fiscal year. 

13 ‘‘(2) UPDATED NATIONAL PER RESIDENT

14 AMOUNT FOR DIRECT GRADUATE MEDICAL EDU15 CATION.—The updated per resident amount for di16 rect graduate medical education for a qualified 

17 teaching health center for a fiscal year is an amount 

18 determined as follows: 

19 ‘‘(A) DETERMINATION OF QUALIFIED

20 TEACHING HEALTH CENTER PER RESIDENT

21 AMOUNT.—The Secretary shall compute for 

22 each individual qualified teaching health center 

23 a per resident amount— 

24 ‘‘(i) by dividing the national average 

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1 tion 340E(c)(2)(D) into a wage-related 

2 portion and a non-wage related portion by 

3 applying the proportion determined under 

4 subparagraph (B); 

5 ‘‘(ii) by multiplying the wage-related 

6 portion by the factor applied under section 

7 1886(d)(3)(E) of the Social Security Act 

8 (but without application of section 4410 of 

9 the Balanced Budget Act of 1997 (42 

10 U.S.C. 1395ww note)) during the pre11 ceding fiscal year for the teaching health 

12 center’s area; and 

13 ‘‘(iii) by adding the non-wage-related 

14 portion to the amount computed under 

15 clause (ii). 

16 ‘‘(B) UPDATING RATE.—The Secretary 

17 shall update such per resident amount for each 

18 such qualified teaching health center as deter19 mined appropriate by the Secretary. 

20 ‘‘(d) AMOUNT OF PAYMENT FOR INDIRECT MEDICAL

21 EDUCATION.— 

22 ‘‘(1) IN GENERAL.—The amount determined 

23 under this subsection for payments to qualified 

24 teaching health centers for indirect expenses associ25 ated with the additional costs of teaching residents 


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1 for a fiscal year is equal to an amount determined 

2 appropriate by the Secretary. 

3 ‘‘(2) FACTORS.—In determining the amount 

4 under paragraph (1), the Secretary shall— 

5 ‘‘(A) evaluate indirect training costs rel6 ative to supporting a primary care residency 

7 program in qualified teaching health centers; 

8 and 

9 ‘‘(B) based on this evaluation, assure that 

10 the aggregate of the payments for indirect ex11 penses under this section and the payments for 

12 direct graduate medical education as deter13 mined under subsection (c) in a fiscal year do 

14 not exceed the amount appropriated for such 

15 expenses as determined in subsection (g). 

16 ‘‘(3) INTERIM PAYMENT.—Before the Secretary 

17 makes a payment under this subsection pursuant to 

18 a determination of indirect expenses under para19 graph (1), the Secretary may provide to qualified 

20 teaching health centers a payment, in addition to 

21 any payment made under subsection (c), for ex22 pected indirect expenses associated with the addi23 tional costs of teaching residents for a fiscal year, 

24 based on an estimate by the Secretary. 


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1 ‘‘(e) CLARIFICATION REGARDING RELATIONSHIP TO

2 OTHER PAYMENTS FOR GRADUATE MEDICAL EDU3 CATION.—Payments under this section— 

4 ‘‘(1) shall be in addition to any payments— 

5 ‘‘(A) for the indirect costs of medical edu6 cation under section 1886(d)(5)(B) of the So7 cial Security Act; 

8 ‘‘(B) for direct graduate medical education 

9 costs under section 1886(h) of such Act; and 

10 ‘‘(C) for direct costs of medical education 

11 under section 1886(k) of such Act; 

12 ‘‘(2) shall not be taken into account in applying 

13 the limitation on the number of total full-time equiv14 alent residents under subparagraphs (F) and (G) of 

15 section 1886(h)(4) of such Act and clauses (v), 

16 (vi)(I), and (vi)(II) of section 1886(d)(5)(B) of such 

17 Act for the portion of time that a resident rotates 

18 to a hospital; and 

19 ‘‘(3) shall not include the time in which a resi20 dent is counted toward full-time equivalency by a 

21 hospital under paragraph (2) or under section 

22 1886(d)(5)(B)(iv) of the Social Security Act, section 

23 1886(h)(4)(E) of such Act, or section 340E of this 

24 Act. 


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1 ‘‘(f) RECONCILIATION.—The Secretary shall deter2 mine any changes to the number of residents reported by 

3 a hospital in the application of the hospital for the current 

4 fiscal year to determine the final amount payable to the 

5 hospital for the current fiscal year for both direct expense 

6 and indirect expense amounts. Based on such determina7 tion, the Secretary shall recoup any overpayments made 

8 to pay any balance due to the extent possible. The final 

9 amount so determined shall be considered a final inter10 mediary determination for the purposes of section 1878 

11 of the Social Security Act and shall be subject to adminis12 trative and judicial review under that section in the same 

13 manner as the amount of payment under section 1186(d) 

14 of such Act is subject to review under such section. 

15 ‘‘(g) FUNDING.—To carry out this section, there are 

16 appropriated such sums as may be necessary, not to ex17 ceed $230,000,000, for the period of fiscal years 2011 

18 through 2015. 

19 ‘‘(h) ANNUAL REPORTING REQUIRED.— 

20 ‘‘(1) ANNUAL REPORT.—The report required 

21 under this paragraph for a qualified teaching health 

22 center for a fiscal year is a report that includes (in 

23 a form and manner specified by the Secretary) the 

24 following information for the residency academic 

25 year completed immediately prior to such fiscal year: 


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1 ‘‘(A) The types of primary care resident 

2 approved training programs that the qualified 

3 teaching health center provided for residents. 

4 ‘‘(B) The number of approved training po5 sitions for residents described in paragraph (4). 

6 ‘‘(C) The number of residents described in 

7 paragraph (4) who completed their residency 

8 training at the end of such residency academic 

9 year and care for vulnerable populations living 

10 in underserved areas. 

11 ‘‘(D) Other information as deemed appro12 priate by the Secretary. 

13 ‘‘(2) AUDIT AUTHORITY; LIMITATION ON PAY14 MENT.— 

15 ‘‘(A) AUDIT AUTHORITY.—The Secretary 

16 may audit a qualified teaching health center to 

17 ensure the accuracy and completeness of the in18 formation submitted in a report under para19 graph (1). 

20 ‘‘(B) LIMITATION ON PAYMENT.—A teach21 ing health center may only receive payment in 

22 a cost reporting period for a number of such 

23 resident positions that is greater than the base 

24 level of primary care resident positions, as de25 termined by the Secretary. For purposes of this 


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1 subparagraph, the ‘base level of primary care 

2 residents’ for a teaching health center is the 

3 level of such residents as of a base period. 

4 ‘‘(3) REDUCTION IN PAYMENT FOR FAILURE TO

5 REPORT.— 

6 ‘‘(A) IN GENERAL.—The amount payable 

7 under this section to a qualified teaching health 

8 center for a fiscal year shall be reduced by at 

9 least 25 percent if the Secretary determines 

10 that— 

11 ‘‘(i) the qualified teaching health cen12 ter has failed to provide the Secretary, as 

13 an addendum to the qualified teaching 

14 health center’s application under this sec15 tion for such fiscal year, the report re16 quired under paragraph (1) for the pre17 vious fiscal year; or 

18 ‘‘(ii) such report fails to provide com19 plete and accurate information required 

20 under any subparagraph of such para21 graph. 

22 ‘‘(B) NOTICE AND OPPORTUNITY TO PRO23 VIDE ACCURATE AND MISSING INFORMATION.— 

24 Before imposing a reduction under subpara25 graph (A) on the basis of a qualified teaching 


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1 health center’s failure to provide complete and 

2 accurate information described in subparagraph 

3 (A)(ii), the Secretary shall provide notice to the 

4 teaching health center of such failure and the 

5 Secretary’s intention to impose such reduction 

6 and shall provide the teaching health center 

7 with the opportunity to provide the required in8 formation within the period of 30 days begin9 ning on the date of such notice. If the teaching 

10 health center provides such information within 

11 such period, no reduction shall be made under 

12 subparagraph (A) on the basis of the previous 

13 failure to provide such information. 

14 ‘‘(4) RESIDENTS.—The residents described in 

15 this paragraph are those who are in part-time or 

16 full-time equivalent resident training positions at a 

17 qualified teaching health center in any approved 

18 graduate medical residency training program. 

19 ‘‘(i) REGULATIONS.—The Secretary shall promulgate 

20 regulations to carry out this section. 

21 ‘‘(j) DEFINITIONS.—In this section: 

22 ‘‘(1) APPROVED GRADUATE MEDICAL RESI23 DENCY TRAINING PROGRAM.—The term ‘approved 

24 graduate medical residency training program’ means 


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1 a residency or other postgraduate medical training 

2 program— 

3 ‘‘(A) participation in which may be count4 ed toward certification in a specialty or sub5 specialty and includes formal postgraduate 

6 training programs in geriatric medicine ap7 proved by the Secretary; and 

8 ‘‘(B) that meets criteria for accreditation 

9 (as established by the Accreditation Council for 

10 Graduate Medical Education, the American Os11 teopathic Association, or the American Dental 

12 Association). 

13 ‘‘(2) PRIMARY CARE RESIDENCY PROGRAM.— 

14 The term ‘primary care residency program’ has the 

15 meaning given that term in section 749A. 

16 ‘‘(3) QUALIFIED TEACHING HEALTH CENTER.— 

17 The term ‘qualified teaching health center’ has the 

18 meaning given the term ‘teaching health center’ in 

19 section 749A.’’. 

20 SEC. 5509. GRADUATE NURSE EDUCATION DEMONSTRA21 TION. 

22 (a) IN GENERAL.— 

23 (1) ESTABLISHMENT.— 

24 (A) IN GENERAL.—The Secretary shall es25 tablish a graduate nurse education demonstraVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01500 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tion under title XVIII of the Social Security 

2 Act (42 U.S.C. 1395 et seq.) under which an el3 igible hospital may receive payment for the hos4 pital’s reasonable costs (described in paragraph 

5 (2)) for the provision of qualified clinical train6 ing to advance practice nurses. 

7 (B) NUMBER.—The demonstration shall 

8 include up to 5 eligible hospitals. 

9 (C) WRITTEN AGREEMENTS.—Eligible hos10 pitals selected to participate in the demonstra11 tion shall enter into written agreements pursu12 ant to subsection (b) in order to reimburse the 

13 eligible partners of the hospital the share of the 

14 costs attributable to each partner. 

15 (2) COSTS DESCRIBED.— 

16 (A) IN GENERAL.—Subject to subpara17 graph (B) and subsection (d), the costs de18 scribed in this paragraph are the reasonable 

19 costs (as described in section 1861(v) of the So20 cial Security Act (42 U.S.C. 1395x(v))) of each 

21 eligible hospital for the clinical training costs 

22 (as determined by the Secretary) that are at23 tributable to providing advanced practice reg24 istered nurses with qualified training. 


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1 (B) LIMITATION.—With respect to a year, 

2 the amount reimbursed under subparagraph (A) 

3 may not exceed the amount of costs described 

4 in subparagraph (A) that are attributable to an 

5 increase in the number of advanced practice 

6 registered nurses enrolled in a program that 

7 provides qualified training during the year and 

8 for which the hospital is being reimbursed 

9 under the demonstration, as compared to the 

10 average number of advanced practice registered 

11 nurses who graduated in each year during the 

12 period beginning on January 1, 2006, and end13 ing on December 31, 2010 (as determined by 

14 the Secretary) from the graduate nursing edu15 cation program operated by the applicable 

16 school of nursing that is an eligible partner of 

17 the hospital for purposes of the demonstration. 

18 (3) WAIVER AUTHORITY.—The Secretary may 

19 waive such requirements of titles XI and XVIII of 

20 the Social Security Act as may be necessary to carry 

21 out the demonstration. 

22 (4) ADMINISTRATION.—Chapter 35 of title 44, 

23 United States Code, shall not apply to the imple24 mentation of this section. 


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1 (b) WRITTEN AGREEMENTS WITH ELIGIBLE PART2 NERS.—No payment shall be made under this section to 

3 an eligible hospital unless such hospital has in effect a 

4 written agreement with the eligible partners of the hos5 pital. Such written agreement shall describe, at a min6 imum— 

7 (1) the obligations of the eligible partners with 

8 respect to the provision of qualified training; and 

9 (2) the obligation of the eligible hospital to re10 imburse such eligible partners applicable (in a timely 

11 manner) for the costs of such qualified training at12 tributable to partner. 

13 (c) EVALUATION.—Not later than October 17, 2017, 

14 the Secretary shall submit to Congress a report on the 

15 demonstration. Such report shall include an analysis of the 

16 following: 

17 (1) The growth in the number of advanced 

18 practice registered nurses with respect to a specific 

19 base year as a result of the demonstration. 

20 (2) The growth for each of the specialties de21 scribed in subparagraphs (A) through (D) of sub22 section (e)(1). 

23 (3) The costs to the Medicare program under 

24 title XVIII of the Social Security Act as a result of 

25 the demonstration. 


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1 (4) Other items the Secretary determines ap2 propriate and relevant. 

3 (d) FUNDING.— 

4 (1) IN GENERAL.—There is hereby appro5 priated to the Secretary, out of any funds in the 

6 Treasury not otherwise appropriated, $50,000,000 

7 for each of fiscal years 2012 through 2015 to carry 

8 out this section, including the design, implementa9 tion, monitoring, and evaluation of the demonstra10 tion. 

11 (2) PRORATION.—If the aggregate payments to 

12 eligible hospitals under the demonstration exceed 

13 $50,000,000 for a fiscal year described in paragraph 

14 (1), the Secretary shall prorate the payment 

15 amounts to each eligible hospital in order to ensure 

16 that the aggregate payments do not exceed such 

17 amount. 

18 (3) WITHOUT FISCAL YEAR LIMITATION.— 

19 Amounts appropriated under this subsection shall 

20 remain available without fiscal year limitation. 

21 (e) DEFINITIONS.—In this section: 

22 (1) ADVANCED PRACTICE REGISTERED

23 NURSE.—The term ‘‘advanced practice registered 

24 nurse’’ includes the following: 


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1 (A) A clinical nurse specialist (as defined 

2 in subsection (aa)(5) of section 1861 of the So3 cial Security Act (42 U.S.C. 1395x)). 

4 (B) A nurse practitioner (as defined in 

5 such subsection). 

6 (C) A certified registered nurse anesthetist 

7 (as defined in subsection (bb)(2) of such sec8 tion). 

9 (D) A certified nurse-midwife (as defined 

10 in subsection (gg)(2) of such section). 

11 (2) APPLICABLE NON-HOSPITAL COMMUNITY12 BASED CARE SETTING.—The term ‘‘applicable non13 hospital community-based care setting’’ means a 

14 non-hospital community-based care setting which 

15 has entered into a written agreement (as described 

16 in subsection (b)) with the eligible hospital partici17 pating in the demonstration. Such settings include 

18 Federally qualified health centers, rural health clin19 ics, and other non-hospital settings as determined 

20 appropriate by the Secretary. 

21 (3) APPLICABLE SCHOOL OF NURSING.—The 

22 term ‘‘applicable school of nursing’’ means an ac23 credited school of nursing (as defined in section 801 

24 of the Public Health Service Act) which has entered 

25 into a written agreement (as described in subsection 


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1 (b)) with the eligible hospital participating in the 

2 demonstration. 

3 (4) DEMONSTRATION.—The term ‘‘demonstra4 tion’’ means the graduate nurse education dem5 onstration established under subsection (a). 

6 (5) ELIGIBLE HOSPITAL.—The term ‘‘eligible 

7 hospital’’ means a hospital (as defined in subsection 

8 (e) of section 1861 of the Social Security Act (42 

9 U.S.C. 1395x)) or a critical access hospital (as de10 fined in subsection (mm)(1) of such section) that 

11 has a written agreement in place with— 

12 (A) 1 or more applicable schools of nurs13 ing; and 

14 (B) 2 or more applicable non-hospital com15 munity-based care settings. 

16 (6) ELIGIBLE PARTNERS.—The term ‘‘eligible 

17 partners’’ includes the following: 

18 (A) An applicable non-hospital community19 based care setting. 

20 (B) An applicable school of nursing. 

21 (7) QUALIFIED TRAINING.— 

22 (A) IN GENERAL.—The term ‘‘qualified 

23 training’’ means training— 

24 (i) that provides an advanced practice 

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1 essary to provide primary care, preventive 

2 care, transitional care, chronic care man3 agement, and other services appropriate 

4 for individuals entitled to, or enrolled for, 

5 benefits under part A of title XVIII of the 

6 Social Security Act, or enrolled under part 

7 B of such title; and 

8 (ii) subject to subparagraph (B), at 

9 least half of which is provided in a non10 hospital community-based care setting. 

11 (B) WAIVER OF REQUIREMENT HALF OF

12 TRAINING BE PROVIDED IN NON-HOSPITAL

13 COMMUNITY-BASED CARE SETTING IN CERTAIN

14 AREAS.—The Secretary may waive the require15 ment under subparagraph (A)(ii) with respect 

16 to eligible hospitals located in rural or medically 

17 underserved areas. 

18 (8) SECRETARY.—The term ‘‘Secretary’’ means 

19 the Secretary of Health and Human Services. 


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1 Subtitle G—Improving Access to 

2 Health Care Services 

3 SEC. 5601. SPENDING FOR FEDERALLY QUALIFIED HEALTH 

4 CENTERS (FQHCS). 

5 (a) IN GENERAL.—Section 330(r) of the Public 

6 Health Service Act (42 U.S.C. 254b(r)) is amended by 

7 striking paragraph (1) and inserting the following: 

8 ‘‘(1) GENERAL AMOUNTS FOR GRANTS.—For 

9 the purpose of carrying out this section, in addition 

10 to the amounts authorized to be appropriated under 

11 subsection (d), there is authorized to be appro12 priated the following: 

13 ‘‘(A) For fiscal year 2010, 

14 $2,988,821,592. 

15 ‘‘(B) For fiscal year 2011, 

16 $3,862,107,440. 

17 ‘‘(C) For fiscal year 2012, $4,990,553,440. 

18 ‘‘(D) For fiscal year 2013, 

19 $6,448,713,307. 

20 ‘‘(E) For fiscal year 2014, 

21 $7,332,924,155. 

22 ‘‘(F) For fiscal year 2015, 

23 $8,332,924,155. 

24 ‘‘(G) For fiscal year 2016, and each subse25 quent fiscal year, the amount appropriated for 


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1 the preceding fiscal year adjusted by the prod2 uct of— 

3 ‘‘(i) one plus the average percentage 

4 increase in costs incurred per patient 

5 served; and 

6 ‘‘(ii) one plus the average percentage 

7 increase in the total number of patients 

8 served.’’. 

9 (b) RULE OF CONSTRUCTION.—Section 330(r) of the 

10 Public Health Service Act (42 U.S.C. 254b(r)) is amended 

11 by adding at the end the following: 

12 ‘‘(4) RULE OF CONSTRUCTION WITH RESPECT

13 TO RURAL HEALTH CLINICS.— 

14 ‘‘(A) IN GENERAL.—Nothing in this sec15 tion shall be construed to prevent a community 

16 health center from contracting with a Federally 

17 certified rural health clinic (as defined in sec18 tion 1861(aa)(2) of the Social Security Act), a 

19 low-volume hospital (as defined for purposes of 

20 section 1886 of such Act), a critical access hos21 pital, a sole community hospital (as defined for 

22 purposes of section 1886(d)(5)(D)(iii) of such 

23 Act), or a medicare-dependent share hospital 

24 (as defined for purposes of section 

25 1886(d)(5)(G)(iv) of such Act) for the delivery 


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1 of primary health care services that are avail2 able at the clinic or hospital to individuals who 

3 would otherwise be eligible for free or reduced 

4 cost care if that individual were able to obtain 

5 that care at the community health center. Such 

6 services may be limited in scope to those pri7 mary health care services available in that clinic 

8 or hospitals. 

9 ‘‘(B) ASSURANCES.—In order for a clinic 

10 or hospital to receive funds under this section 

11 through a contract with a community health 

12 center under subparagraph (A), such clinic or 

13 hospital shall establish policies to ensure— 

14 ‘‘(i) nondiscrimination based on the 

15 ability of a patient to pay; and 

16 ‘‘(ii) the establishment of a sliding fee 

17 scale for low-income patients.’’. 

18 SEC. 5602. NEGOTIATED RULEMAKING FOR DEVELOPMENT 

19 OF METHODOLOGY AND CRITERIA FOR DES20 IGNATING MEDICALLY UNDERSERVED POPU21 LATIONS AND HEALTH PROFESSIONS SHORT22 AGE AREAS. 

23 (a) ESTABLISHMENT.— 

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

25 Human Services (in this section referred to as the 


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1 ‘‘Secretary’’) shall establish, through a negotiated 

2 rulemaking process under subchapter 3 of chapter 5 

3 of title 5, United States Code, a comprehensive 

4 methodology and criteria for designation of— 

5 (A) medically underserved populations in 

6 accordance with section 330(b)(3) of the Public 

7 Health Service Act (42 U.S.C. 254b(b)(3)); 

8 (B) health professions shortage areas 

9 under section 332 of the Public Health Service 

10 Act (42 U.S.C. 254e). 

11 (2) FACTORS TO CONSIDER.—In establishing 

12 the methodology and criteria under paragraph (1), 

13 the Secretary— 

14 (A) shall consult with relevant stakeholders 

15 who will be significantly affected by a rule 

16 (such as national, State and regional organiza17 tions representing affected entities), State 

18 health offices, community organizations, health 

19 centers and other affected entities, and other 

20 interested parties; and 

21 (B) shall take into account— 

22 (i) the timely availability and appro23 priateness of data used to determine a des24 ignation to potential applicants for such 

25 designations; 


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1 (ii) the impact of the methodology and 

2 criteria on communities of various types 

3 and on health centers and other safety net 

4 providers; 

5 (iii) the degree of ease or difficulty 

6 that will face potential applicants for such 

7 designations in securing the necessary 

8 data; and 

9 (iv) the extent to which the method10 ology accurately measures various barriers 

11 that confront individuals and population 

12 groups in seeking health care services. 

13 (b) PUBLICATION OF NOTICE.—In carrying out the 

14 rulemaking process under this subsection, the Secretary 

15 shall publish the notice provided for under section 564(a) 

16 of title 5, United States Code, by not later than 45 days 

17 after the date of the enactment of this Act. 

18 (c) TARGET DATE FOR PUBLICATION OF RULE.—As 

19 part of the notice under subsection (b), and for purposes 

20 of this subsection, the ‘‘target date for publication’’, as 

21 referred to in section 564(a)(5) of title 5, United Sates 

22 Code, shall be July 1, 2010. 

23 (d) APPOINTMENT OF NEGOTIATED RULEMAKING

24 COMMITTEE AND FACILITATOR.—The Secretary shall pro25 vide for— 


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1 (1) the appointment of a negotiated rulemaking 

2 committee under section 565(a) of title 5, United 

3 States Code, by not later than 30 days after the end 

4 of the comment period provided for under section 

5 564(c) of such title; and 

6 (2) the nomination of a facilitator under section 

7 566(c) of such title 5 by not later than 10 days after 

8 the date of appointment of the committee. 

9 (e) PRELIMINARY COMMITTEE REPORT.—The nego10 tiated rulemaking committee appointed under subsection 

11 (d) shall report to the Secretary, by not later than April 

12 1, 2010, regarding the committee’s progress on achieving 

13 a consensus with regard to the rulemaking proceeding and 

14 whether such consensus is likely to occur before one month 

15 before the target date for publication of the rule. If the 

16 committee reports that the committee has failed to make 

17 significant progress toward such consensus or is unlikely 

18 to reach such consensus by the target date, the Secretary 

19 may terminate such process and provide for the publica20 tion of a rule under this section through such other meth21 ods as the Secretary may provide. 

22 (f) FINAL COMMITTEE REPORT.—If the committee 

23 is not terminated under subsection (e), the rulemaking 

24 committee shall submit a report containing a proposed 


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1 rule by not later than one month before the target publica2 tion date. 

3 (g) INTERIM FINAL EFFECT.—The Secretary shall 

4 publish a rule under this section in the Federal Register 

5 by not later than the target publication date. Such rule 

6 shall be effective and final immediately on an interim 

7 basis, but is subject to change and revision after public 

8 notice and opportunity for a period (of not less than 90 

9 days) for public comment. In connection with such rule, 

10 the Secretary shall specify the process for the timely re11 view and approval of applications for such designations 

12 pursuant to such rules and consistent with this section. 

13 (h) PUBLICATION OF RULE AFTER PUBLIC COM14 MENT.—The Secretary shall provide for consideration of 

15 such comments and republication of such rule by not later 

16 than 1 year after the target publication date. 

17 SEC. 5603. REAUTHORIZATION OF THE WAKEFIELD EMER18 GENCY MEDICAL SERVICES FOR CHILDREN 

19 PROGRAM. 

20 Section 1910 of the Public Health Service Act (42 

21 U.S.C. 300w–9) is amended— 

22 (1) in subsection (a), by striking ‘‘3-year period 

23 (with an optional 4th year’’ and inserting ‘‘4-year 

24 period (with an optional 5th year’’; and 

25 (2) in subsection (d)— 


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1 (A) by striking ‘‘and such sums’’ and in2 serting ‘‘such sums’’; and 

3 (B) by inserting before the period the fol4 lowing: ‘‘, $25,000,000 for fiscal year 2010, 

5 $26,250,000 for fiscal year 2011, $27,562,500 

6 for fiscal year 2012, $28,940,625 for fiscal year 

7 2013, and $30,387,656 for fiscal year 2014’’. 

8 SEC. 5604. CO-LOCATING PRIMARY AND SPECIALTY CARE 

9 IN COMMUNITY-BASED MENTAL HEALTH SET10 TINGS. 

11 Subpart 3 of part B of title V of the Public Health 

12 Service Act (42 U.S.C. 290bb–31 et seq.) is amended by 

13 adding at the end the following: 

14 ‘‘SEC. 520K. AWARDS FOR CO-LOCATING PRIMARY AND SPE15 CIALTY CARE IN COMMUNITY-BASED MENTAL 

16 HEALTH SETTINGS. 

17 ‘‘(a) DEFINITIONS.—In this section: 

18 ‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en19 tity’ means a qualified community mental health 

20 program defined under section 1913(b)(1). 

21 ‘‘(2) SPECIAL POPULATIONS.—The term ‘spe22 cial populations’ means adults with mental illnesses 

23 who have co-occurring primary care conditions and 

24 chronic diseases. 


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1 ‘‘(b) PROGRAM AUTHORIZED.—The Secretary, acting 

2 through the Administrator shall award grants and cooper3 ative agreements to eligible entities to establish dem4 onstration projects for the provision of coordinated and 

5 integrated services to special populations through the co6 location of primary and specialty care services in commu7 nity-based mental and behavioral health settings. 

8 ‘‘(c) APPLICATION.—To be eligible to receive a grant 

9 or cooperative agreement under this section, an eligible en10 tity shall submit an application to the Administrator at 

11 such time, in such manner, and accompanied by such in12 formation as the Administrator may require, including a 

13 description of partnerships, or other arrangements with 

14 local primary care providers, including community health 

15 centers, to provide services to special populations. 

16 ‘‘(d) USE OF FUNDS.— 

17 ‘‘(1) IN GENERAL.—For the benefit of special 

18 populations, an eligible entity shall use funds award19 ed under this section for— 

20 ‘‘(A) the provision, by qualified primary 

21 care professionals, of on site primary care serv22 ices; 

23 ‘‘(B) reasonable costs associated with 

24 medically necessary referrals to qualified spe25 cialty care professionals, other coordinators of 


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1 care or, if permitted by the terms of the grant 

2 or cooperative agreement, by qualified specialty 

3 care professionals on a reasonable cost basis on 

4 site at the eligible entity; 

5 ‘‘(C) information technology required to 

6 accommodate the clinical needs of primary and 

7 specialty care professionals; or 

8 ‘‘(D) facility modifications needed to bring 

9 primary and specialty care professionals on site 

10 at the eligible entity. 

11 ‘‘(2) LIMITATION.—Not to exceed 15 percent of 

12 grant or cooperative agreement funds may be used 

13 for activities described in subparagraphs (C) and 

14 (D) of paragraph (1). 

15 ‘‘(e) EVALUATION.—Not later than 90 days after a 

16 grant or cooperative agreement awarded under this section 

17 expires, an eligible entity shall submit to the Secretary the 

18 results of an evaluation to be conducted by the entity con19 cerning the effectiveness of the activities carried out under 

20 the grant or agreement. 

21 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

22 are authorized to be appropriated to carry out this section, 

23 $50,000,000 for fiscal year 2010 and such sums as may 

24 be necessary for each of fiscal years 2011 through 2014.’’. 


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1 SEC. 5605. KEY NATIONAL INDICATORS. 

2 (a) DEFINITIONS.—In this section: 

3 (1) ACADEMY.—The term ‘‘Academy’’ means 

4 the National Academy of Sciences. 

5 (2) COMMISSION.—The term ‘‘Commission’’ 

6 means the Commission on Key National Indicators 

7 established under subsection (b). 

8 (3) INSTITUTE.—The term ‘‘Institute’’ means a 

9 Key National Indicators Institute as designated 

10 under subsection (c)(3). 

11 (b) COMMISSION ON KEY NATIONAL INDICATORS.— 

12 (1) ESTABLISHMENT.—There is established a 

13 ‘‘Commission on Key National Indicators’’. 

14 (2) MEMBERSHIP.— 

15 (A) NUMBER AND APPOINTMENT.—The 

16 Commission shall be composed of 8 members, to 

17 be appointed equally by the majority and mi18 nority leaders of the Senate and the Speaker 

19 and minority leader of the House of Represent20 atives. 

21 (B) PROHIBITED APPOINTMENTS.—Mem22 bers of the Commission shall not include Mem23 bers of Congress or other elected Federal, 

24 State, or local government officials. 

25 (C) QUALIFICATIONS.—In making appoint26 ments under subparagraph (A), the majority 


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1 and minority leaders of the Senate and the 

2 Speaker and minority leader of the House of 

3 Representatives shall appoint individuals who 

4 have shown a dedication to improving civic dia5 logue and decision-making through the wide use 

6 of scientific evidence and factual information. 

7 (D) PERIOD OF APPOINTMENT.—Each 

8 member of the Commission shall be appointed 

9 for a 2-year term, except that 1 initial appoint10 ment shall be for 3 years. Any vacancies shall 

11 not affect the power and duties of the Commis12 sion but shall be filled in the same manner as 

13 the original appointment and shall last only for 

14 the remainder of that term. 

15 (E) DATE.—Members of the Commission 

16 shall be appointed by not later than 30 days 

17 after the date of enactment of this Act. 

18 (F) INITIAL ORGANIZING PERIOD.—–Not 

19 later than 60 days after the date of enactment 

20 of this Act, the Commission shall develop and 

21 implement a schedule for completion of the re22 view and reports required under subsection (d). 

23 (G) CO-CHAIRPERSONS.—The Commission 

24 shall select 2 Co-Chairpersons from among its 

25 members. 


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1 (c) DUTIES OF THE COMMISSION.— 

2 (1) IN GENERAL.—The Commission shall— 

3 (A) conduct comprehensive oversight of a 

4 newly established key national indicators system 

5 consistent with the purpose described in this 

6 subsection; 

7 (B) make recommendations on how to im8 prove the key national indicators system; 

9 (C) coordinate with Federal Government 

10 users and information providers to assure ac11 cess to relevant and quality data; and 

12 (D) enter into contracts with the Academy. 

13 (2) REPORTS.— 

14 (A) ANNUAL REPORT TO CONGRESS.—Not 

15 later than 1 year after the selection of the 2 

16 Co-Chairpersons of the Commission, and each 

17 subsequent year thereafter, the Commission 

18 shall prepare and submit to the appropriate 

19 Committees of Congress and the President a re20 port that contains a detailed statement of the 

21 recommendations, findings, and conclusions of 

22 the Commission on the activities of the Acad23 emy and a designated Institute related to the 

24 establishment of a Key National Indicator Sys25 tem. 


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1 (B) ANNUAL REPORT TO THE ACADEMY.— 

2 (i) IN GENERAL.—Not later than 6 

3 months after the selection of the 2 Co4 Chairpersons of the Commission, and each 

5 subsequent year thereafter, the Commis6 sion shall prepare and submit to the Acad7 emy and a designated Institute a report 

8 making recommendations concerning po9 tential issue areas and key indicators to be 

10 included in the Key National Indicators. 

11 (ii) LIMITATION.—The Commission 

12 shall not have the authority to direct the 

13 Academy or, if established, the Institute, 

14 to adopt, modify, or delete any key indica15 tors. 

16 (3) CONTRACT WITH THE NATIONAL ACADEMY

17 OF SCIENCES.— 

18 (A) IN GENERAL.—–As soon as practicable 

19 after the selection of the 2 Co-Chairpersons of 

20 the Commission, the Co-Chairpersons shall 

21 enter into an arrangement with the National 

22 Academy of Sciences under which the Academy 

23 shall— 


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1 (i) review available public and private 

2 sector research on the selection of a set of 

3 key national indicators; 

4 (ii) determine how best to establish a 

5 key national indicator system for the 

6 United States, by either creating its own 

7 institutional capability or designating an 

8 independent private nonprofit organization 

9 as an Institute to implement a key national 

10 indicator system; 

11 (iii) if the Academy designates an 

12 independent Institute under clause (ii), 

13 provide scientific and technical advice to 

14 the Institute and create an appropriate 

15 governance mechanism that balances Acad16 emy involvement and the independence of 

17 the Institute; and 

18 (iv) provide an annual report to the 

19 Commission addressing scientific and tech20 nical issues related to the key national in21 dicator system and, if established, the In22 stitute, and governance of the Institute’s 

23 budget and operations. 

24 (B) PARTICIPATION.—In executing the ar25 rangement under subparagraph (A), the NaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01522 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tional Academy of Sciences shall convene a 

2 multi-sector, multi-disciplinary process to define 

3 major scientific and technical issues associated 

4 with developing, maintaining, and evolving a 

5 Key National Indicator System and, if an Insti6 tute is established, to provide it with scientific 

7 and technical advice. 

8 (C) ESTABLISHMENT OF A KEY NATIONAL

9 INDICATOR SYSTEM.— 

10 (i) IN GENERAL.—In executing the ar11 rangement under subparagraph (A), the 

12 National Academy of Sciences shall enable 

13 the establishment of a key national indi14 cator system by— 

15 (I) creating its own institutional 

16 capability; or 

17 (II) partnering with an inde18 pendent private nonprofit organization 

19 as an Institute to implement a key na20 tional indicator system. 

21 (ii) INSTITUTE.—If the Academy des22 ignates an Institute under clause (i)(II), 

23 such Institute shall be a non-profit entity 

24 (as defined for purposes of section 

25 501(c)(3) of the Internal Revenue Code of 


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1 1986) with an educational mission, a gov2 ernance structure that emphasizes inde3 pendence, and characteristics that make 

4 such entity appropriate for establishing a 

5 key national indicator system. 

6 (iii) RESPONSIBILITIES.—Either the 

7 Academy or the Institute designated under 

8 clause (i)(II) shall be responsible for the 

9 following: 

10 (I) Identifying and selecting issue 

11 areas to be represented by the key na12 tional indicators. 

13 (II) Identifying and selecting the 

14 measures used for key national indica15 tors within the issue areas under sub16 clause (I). 

17 (III) Identifying and selecting 

18 data to populate the key national indi19 cators described under subclause (II). 

20 (IV) Designing, publishing, and 

21 maintaining a public website that con22 tains a freely accessible database al23 lowing public access to the key na24 tional indicators. 


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1 (V) Developing a quality assur2 ance framework to ensure rigorous 

3 and independent processes and the se4 lection of quality data. 

5 (VI) Developing a budget for the 

6 construction and management of a 

7 sustainable, adaptable, and evolving 

8 key national indicator system that re9 flects all Commission funding of 

10 Academy and, if an Institute is estab11 lished, Institute activities. 

12 (VII) Reporting annually to the 

13 Commission regarding its selection of 

14 issue areas, key indicators, data, and 

15 progress toward establishing a web-ac16 cessible database. 

17 (VIII) Responding directly to the 

18 Commission in response to any Com19 mission recommendations and to the 

20 Academy regarding any inquiries by 

21 the Academy. 

22 (iv) GOVERNANCE.—Upon the estab23 lishment of a key national indicator sys24 tem, the Academy shall create an appro25 priate governance mechanism that incorVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01525 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 porates advisory and control functions. If 

2 an Institute is designated under clause 

3 (i)(II), the governance mechanism shall 

4 balance appropriate Academy involvement 

5 and the independence of the Institute. 

6 (v) MODIFICATION AND CHANGES.— 

7 The Academy shall retain the sole discre8 tion, at any time, to alter its approach to 

9 the establishment of a key national indi10 cator system or, if an Institute is des11 ignated under clause (i)(II), to alter any 

12 aspect of its relationship with the Institute 

13 or to designate a different non-profit entity 

14 to serve as the Institute. 

15 (vi) CONSTRUCTION.—Nothing in this 

16 section shall be construed to limit the abil17 ity of the Academy or the Institute des18 ignated under clause (i)(II) to receive pri19 vate funding for activities related to the es20 tablishment of a key national indicator sys21 tem. 

22 (D) ANNUAL REPORT.—As part of the ar23 rangement under subparagraph (A), the Na24 tional Academy of Sciences shall, not later than 

25 270 days after the date of enactment of this 


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1 Act, and annually thereafter, submit to the Co2 Chairpersons of the Commission a report that 

3 contains the findings and recommendations of 

4 the Academy. 

5 (d) GOVERNMENT ACCOUNTABILITY OFFICE STUDY

6 AND REPORT.— 

7 (1) GAO STUDY.—The Comptroller General of 

8 the United States shall conduct a study of previous 

9 work conducted by all public agencies, private orga10 nizations, or foreign countries with respect to best 

11 practices for a key national indicator system. The 

12 study shall be submitted to the appropriate author13 izing committees of Congress. 

14 (2) GAO FINANCIAL AUDIT.—If an Institute is 

15 established under this section, the Comptroller Gen16 eral shall conduct an annual audit of the financial 

17 statements of the Institute, in accordance with gen18 erally accepted government auditing standards and 

19 submit a report on such audit to the Commission 

20 and the appropriate authorizing committees of Con21 gress. 

22 (3) GAO PROGRAMMATIC REVIEW.—The Comp23 troller General of the United States shall conduct 

24 programmatic assessments of the Institute estab25 lished under this section as determined necessary by 


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1 the Comptroller General and report the findings to 

2 the Commission and to the appropriate authorizing 

3 committees of Congress. 

4 (e) AUTHORIZATION OF APPROPRIATIONS.— 

5 (1) IN GENERAL.—–There are authorized to be 

6 appropriated to carry out the purposes of this sec7 tion, $10,000,000 for fiscal year 2010, and 

8 $7,500,000 for each of fiscal year 2011 through 

9 2018. 

10 (2) AVAILABILITY.—–Amounts appropriated 

11 under paragraph (1) shall remain available until ex12 pended. 

13 Subtitle H—General Provisions 

14 SEC. 5701. REPORTS. 

15 (a) REPORTS BY SECRETARY OF HEALTH AND

16 HUMAN SERVICES.—On an annual basis, the Secretary of 

17 Health and Human Services shall submit to the appro18 priate Committees of Congress a report on the activities 

19 carried out under the amendments made by this title, and 

20 the effectiveness of such activities. 

21 (b) REPORTS BY RECIPIENTS OF FUNDS.—The Sec22 retary of Health and Human Services may require, as a 

23 condition of receiving funds under the amendments made 

24 by this title, that the entity receiving such award submit 

25 to such Secretary such reports as the such Secretary may 


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1 require on activities carried out with such award, and the 

2 effectiveness of such activities. 

3 TITLE VI—TRANSPARENCY AND 

4 PROGRAM INTEGRITY 

5 Subtitle A—Physician Ownership 

6 and Other Transparency 

7 SEC. 6001. LIMITATION ON MEDICARE EXCEPTION TO THE 

8 PROHIBITION ON CERTAIN PHYSICIAN RE9 FERRALS FOR HOSPITALS. 

10 (a) IN GENERAL.—Section 1877 of the Social Secu11 rity Act (42 U.S.C. 1395nn) is amended— 

12 (1) in subsection (d)(2)— 

13 (A) in subparagraph (A), by striking 

14 ‘‘and’’ at the end; 

15 (B) in subparagraph (B), by striking the 

16 period at the end and inserting ‘‘; and’’; and 

17 (C) by adding at the end the following new 

18 subparagraph: 

19 ‘‘(C) in the case where the entity is a hos20 pital, the hospital meets the requirements of 

21 paragraph (3)(D).’’; 

22 (2) in subsection (d)(3)— 

23 (A) in subparagraph (B), by striking 

24 ‘‘and’’ at the end; 


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1 (B) in subparagraph (C), by striking the 

2 period at the end and inserting ‘‘; and’’; and 

3 (C) by adding at the end the following new 

4 subparagraph: 

5 ‘‘(D) the hospital meets the requirements 

6 described in subsection (i)(1) not later than 18 

7 months after the date of the enactment of this 

8 subparagraph.’’; and 

9 (3) by adding at the end the following new sub10 section: 

11 ‘‘(i) REQUIREMENTS FOR HOSPITALS TO QUALIFY

12 FOR RURAL PROVIDER AND HOSPITAL EXCEPTION TO

13 OWNERSHIP OR INVESTMENT PROHIBITION.— 

14 ‘‘(1) REQUIREMENTS DESCRIBED.—For pur15 poses of subsection (d)(3)(D), the requirements de16 scribed in this paragraph for a hospital are as fol17 lows: 

18 ‘‘(A) PROVIDER AGREEMENT.—The hos19 pital had— 

20 ‘‘(i) physician ownership or invest21 ment on February 1, 2010; and 

22 ‘‘(ii) a provider agreement under sec23 tion 1866 in effect on such date. 

24 ‘‘(B) LIMITATION ON EXPANSION OF FA25 CILITY CAPACITY.—Except as provided in paraVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01530 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 graph (3), the number of operating rooms, pro2 cedure rooms, and beds for which the hospital 

3 is licensed at any time on or after the date of 

4 the enactment of this subsection is no greater 

5 than the number of operating rooms, procedure 

6 rooms, and beds for which the hospital is li7 censed as of such date. 

8 ‘‘(C) PREVENTING CONFLICTS OF INTER9 EST.— 

10 ‘‘(i) The hospital submits to the Sec11 retary an annual report containing a de12 tailed description of— 

13 ‘‘(I) the identity of each physi14 cian owner or investor and any other 

15 owners or investors of the hospital; 

16 and 

17 ‘‘(II) the nature and extent of all 

18 ownership and investment interests in 

19 the hospital. 

20 ‘‘(ii) The hospital has procedures in 

21 place to require that any referring physi22 cian owner or investor discloses to the pa23 tient being referred, by a time that permits 

24 the patient to make a meaningful decision 


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1 regarding the receipt of care, as deter2 mined by the Secretary— 

3 ‘‘(I) the ownership or investment 

4 interest, as applicable, of such refer5 ring physician in the hospital; and 

6 ‘‘(II) if applicable, any such own7 ership or investment interest of the 

8 treating physician. 

9 ‘‘(iii) The hospital does not condition 

10 any physician ownership or investment in11 terests either directly or indirectly on the 

12 physician owner or investor making or in13 fluencing referrals to the hospital or other14 wise generating business for the hospital. 

15 ‘‘(iv) The hospital discloses the fact 

16 that the hospital is partially owned or in17 vested in by physicians— 

18 ‘‘(I) on any public website for the 

19 hospital; and 

20 ‘‘(II) in any public advertising 

21 for the hospital. 

22 ‘‘(D) ENSURING BONA FIDE INVEST23 MENT.— 

24 ‘‘(i) The percentage of the total value 

25 of the ownership or investment interests 


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1 held in the hospital, or in an entity whose 

2 assets include the hospital, by physician 

3 owners or investors in the aggregate does 

4 not exceed such percentage as of the date 

5 of enactment of this subsection. 

6 ‘‘(ii) Any ownership or investment in7 terests that the hospital offers to a physi8 cian owner or investor are not offered on 

9 more favorable terms than the terms of10 fered to a person who is not a physician 

11 owner or investor. 

12 ‘‘(iii) The hospital (or any owner or 

13 investor in the hospital) does not directly 

14 or indirectly provide loans or financing for 

15 any investment in the hospital by a physi16 cian owner or investor. 

17 ‘‘(iv) The hospital (or any owner or 

18 investor in the hospital) does not directly 

19 or indirectly guarantee a loan, make a pay20 ment toward a loan, or otherwise subsidize 

21 a loan, for any individual physician owner 

22 or investor or group of physician owners or 

23 investors that is related to acquiring any 

24 ownership or investment interest in the 

25 hospital. 


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1 ‘‘(v) Ownership or investment returns 

2 are distributed to each owner or investor in 

3 the hospital in an amount that is directly 

4 proportional to the ownership or invest5 ment interest of such owner or investor in 

6 the hospital. 

7 ‘‘(vi) Physician owners and investors 

8 do not receive, directly or indirectly, any 

9 guaranteed receipt of or right to purchase 

10 other business interests related to the hos11 pital, including the purchase or lease of 

12 any property under the control of other 

13 owners or investors in the hospital or lo14 cated near the premises of the hospital. 

15 ‘‘(vii) The hospital does not offer a 

16 physician owner or investor the oppor17 tunity to purchase or lease any property 

18 under the control of the hospital or any 

19 other owner or investor in the hospital on 

20 more favorable terms than the terms of21 fered to an individual who is not a physi22 cian owner or investor. 

23 ‘‘(E) PATIENT SAFETY.— 

24 ‘‘(i) Insofar as the hospital admits a 

25 patient and does not have any physician 


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1 available on the premises to provide serv2 ices during all hours in which the hospital 

3 is providing services to such patient, before 

4 admitting the patient— 

5 ‘‘(I) the hospital discloses such 

6 fact to a patient; and 

7 ‘‘(II) following such disclosure, 

8 the hospital receives from the patient 

9 a signed acknowledgment that the pa10 tient understands such fact. 

11 ‘‘(ii) The hospital has the capacity 

12 to— 

13 ‘‘(I) provide assessment and ini14 tial treatment for patients; and 

15 ‘‘(II) refer and transfer patients 

16 to hospitals with the capability to 

17 treat the needs of the patient in18 volved. 

19 ‘‘(F) LIMITATION ON APPLICATION TO

20 CERTAIN CONVERTED FACILITIES.—The hos21 pital was not converted from an ambulatory 

22 surgical center to a hospital on or after the date 

23 of enactment of this subsection. 

24 ‘‘(2) PUBLICATION OF INFORMATION RE25 PORTED.—The Secretary shall publish, and update 


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1 on an annual basis, the information submitted by 

2 hospitals under paragraph (1)(C)(i) on the public 

3 Internet website of the Centers for Medicare & Med4 icaid Services. 

5 ‘‘(3) EXCEPTION TO PROHIBITION ON EXPAN6 SION OF FACILITY CAPACITY.— 

7 ‘‘(A) PROCESS.— 

8 ‘‘(i) ESTABLISHMENT.—The Secretary 

9 shall establish and implement a process 

10 under which an applicable hospital (as de11 fined in subparagraph (E)) may apply for 

12 an exception from the requirement under 

13 paragraph (1)(B). 

14 ‘‘(ii) OPPORTUNITY FOR COMMUNITY

15 INPUT.—The process under clause (i) shall 

16 provide individuals and entities in the com17 munity in which the applicable hospital ap18 plying for an exception is located with the 

19 opportunity to provide input with respect 

20 to the application. 

21 ‘‘(iii) TIMING FOR IMPLEMENTA22 TION.—The Secretary shall implement the 

23 process under clause (i) on August 1, 

24 2011. 


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1 ‘‘(iv) REGULATIONS.—Not later than 

2 July 1, 2011, the Secretary shall promul3 gate regulations to carry out the process 

4 under clause (i). 

5 ‘‘(B) FREQUENCY.—The process described 

6 in subparagraph (A) shall permit an applicable 

7 hospital to apply for an exception up to once 

8 every 2 years. 

9 ‘‘(C) PERMITTED INCREASE.— 

10 ‘‘(i) IN GENERAL.—Subject to clause 

11 (ii) and subparagraph (D), an applicable 

12 hospital granted an exception under the 

13 process described in subparagraph (A) may 

14 increase the number of operating rooms, 

15 procedure rooms, and beds for which the 

16 applicable hospital is licensed above the 

17 baseline number of operating rooms, proce18 dure rooms, and beds of the applicable 

19 hospital (or, if the applicable hospital has 

20 been granted a previous exception under 

21 this paragraph, above the number of oper22 ating rooms, procedure rooms, and beds 

23 for which the hospital is licensed after the 

24 application of the most recent increase 

25 under such an exception). 


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1 ‘‘(ii) 100 PERCENT INCREASE LIMITA2 TION.—The Secretary shall not permit an 

3 increase in the number of operating rooms, 

4 procedure rooms, and beds for which an 

5 applicable hospital is licensed under clause 

6 (i) to the extent such increase would result 

7 in the number of operating rooms, proce8 dure rooms, and beds for which the appli9 cable hospital is licensed exceeding 200 

10 percent of the baseline number of oper11 ating rooms, procedure rooms, and beds of 

12 the applicable hospital. 

13 ‘‘(iii) BASELINE NUMBER OF OPER14 ATING ROOMS, PROCEDURE ROOMS, AND

15 BEDS.—In this paragraph, the term ‘base16 line number of operating rooms, procedure 

17 rooms, and beds’ means the number of op18 erating rooms, procedure rooms, and beds 

19 for which the applicable hospital is licensed 

20 as of the date of enactment of this sub21 section. 

22 ‘‘(D) INCREASE LIMITED TO FACILITIES

23 ON THE MAIN CAMPUS OF THE HOSPITAL.— 

24 Any increase in the number of operating rooms, 

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1 cable hospital is licensed pursuant to this para2 graph may only occur in facilities on the main 

3 campus of the applicable hospital. 

4 ‘‘(E) APPLICABLE HOSPITAL.—In this 

5 paragraph, the term ‘applicable hospital’ means 

6 a hospital— 

7 ‘‘(i) that is located in a county in 

8 which the percentage increase in the popu9 lation during the most recent 5-year period 

10 (as of the date of the application under 

11 subparagraph (A)) is at least 150 percent 

12 of the percentage increase in the popu13 lation growth of the State in which the 

14 hospital is located during that period, as 

15 estimated by Bureau of the Census; 

16 ‘‘(ii) whose annual percent of total in17 patient admissions that represent inpatient 

18 admissions under the program under title 

19 XIX is equal to or greater than the aver20 age percent with respect to such admis21 sions for all hospitals located in the county 

22 in which the hospital is located; 

23 ‘‘(iii) that does not discriminate 

24 against beneficiaries of Federal health care 

25 programs and does not permit physicians 


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1 practicing at the hospital to discriminate 

2 against such beneficiaries; 

3 ‘‘(iv) that is located in a State in 

4 which the average bed capacity in the 

5 State is less than the national average bed 

6 capacity; and 

7 ‘‘(v) that has an average bed occu8 pancy rate that is greater than the average 

9 bed occupancy rate in the State in which 

10 the hospital is located. 

11 ‘‘(F) PROCEDURE ROOMS.—In this sub12 section, the term ‘procedure rooms’ includes 

13 rooms in which catheterizations, angiographies, 

14 angiograms, and endoscopies are performed, ex15 cept such term shall not include emergency 

16 rooms or departments (exclusive of rooms in 

17 which catheterizations, angiographies, 

18 angiograms, and endoscopies are performed). 

19 ‘‘(G) PUBLICATION OF FINAL DECI20 SIONS.—Not later than 60 days after receiving 

21 a complete application under this paragraph, 

22 the Secretary shall publish in the Federal Reg23 ister the final decision with respect to such ap24 plication. 


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1 ‘‘(H) LIMITATION ON REVIEW.—There 

2 shall be no administrative or judicial review 

3 under section 1869, section 1878, or otherwise 

4 of the process under this paragraph (including 

5 the establishment of such process). 

6 ‘‘(4) COLLECTION OF OWNERSHIP AND INVEST7 MENT INFORMATION.—For purposes of subpara8 graphs (A)(i) and (D)(i) of paragraph (1), the Sec9 retary shall collect physician ownership and invest10 ment information for each hospital. 

11 ‘‘(5) PHYSICIAN OWNER OR INVESTOR DE12 FINED.—For purposes of this subsection, the term 

13 ‘physician owner or investor’ means a physician (or 

14 an immediate family member of such physician) with 

15 a direct or an indirect ownership or investment in16 terest in the hospital. 

17 ‘‘(6) CLARIFICATION.—Nothing in this sub18 section shall be construed as preventing the Sec19 retary from revoking a hospital’s provider agreement 

20 if not in compliance with regulations implementing 

21 section 1866.’’. 

22 (b) ENFORCEMENT.— 

23 (1) ENSURING COMPLIANCE.—The Secretary of 

24 Health and Human Services shall establish policies 

25 and procedures to ensure compliance with the reVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01541 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 quirements described in subsection (i)(1) of section 

2 1877 of the Social Security Act, as added by sub3 section (a)(3), beginning on the date such require4 ments first apply. Such policies and procedures may 

5 include unannounced site reviews of hospitals. 

6 (2) AUDITS.—Beginning not later than Novem7 ber 1, 2011, the Secretary of Health and Human 

8 Services shall conduct audits to determine if hos9 pitals violate the requirements referred to in para10 graph (1). 

11 SEC. 6002. TRANSPARENCY REPORTS AND REPORTING OF 

12 PHYSICIAN OWNERSHIP OR INVESTMENT IN13 TERESTS. 

14 Part A of title XI of the Social Security Act (42 

15 U.S.C. 1301 et seq.) is amended by inserting after section 

16 1128F the following new section: 

17 ‘‘SEC. 1128G. TRANSPARENCY REPORTS AND REPORTING 

18 OF PHYSICIAN OWNERSHIP OR INVESTMENT 

19 INTERESTS. 

20 ‘‘(a) TRANSPARENCY REPORTS.— 

21 ‘‘(1) PAYMENTS OR OTHER TRANSFERS OF

22 VALUE.— 

23 ‘‘(A) IN GENERAL.—On March 31, 2013, 

24 and on the 90th day of each calendar year be25 ginning thereafter, any applicable manufacturer 


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1 that provides a payment or other transfer of 

2 value to a covered recipient (or to an entity or 

3 individual at the request of or designated on be4 half of a covered recipient), shall submit to the 

5 Secretary, in such electronic form as the Sec6 retary shall require, the following information 

7 with respect to the preceding calendar year: 

8 ‘‘(i) The name of the covered recipi9 ent. 

10 ‘‘(ii) The business address of the cov11 ered recipient and, in the case of a covered 

12 recipient who is a physician, the specialty 

13 and National Provider Identifier of the 

14 covered recipient. 

15 ‘‘(iii) The amount of the payment or 

16 other transfer of value. 

17 ‘‘(iv) The dates on which the payment 

18 or other transfer of value was provided to 

19 the covered recipient. 

20 ‘‘(v) A description of the form of the 

21 payment or other transfer of value, indi22 cated (as appropriate for all that apply) 

23 as— 

24 ‘‘(I) cash or a cash equivalent; 

25 ‘‘(II) in-kind items or services; 


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1 ‘‘(III) stock, a stock option, or 

2 any other ownership interest, divi3 dend, profit, or other return on invest4 ment; or 

5 ‘‘(IV) any other form of payment 

6 or other transfer of value (as defined 

7 by the Secretary). 

8 ‘‘(vi) A description of the nature of 

9 the payment or other transfer of value, in10 dicated (as appropriate for all that apply) 

11 as— 

12 ‘‘(I) consulting fees; 

13 ‘‘(II) compensation for services 

14 other than consulting; 

15 ‘‘(III) honoraria; 

16 ‘‘(IV) gift; 

17 ‘‘(V) entertainment; 

18 ‘‘(VI) food; 

19 ‘‘(VII) travel (including the speci20 fied destinations); 

21 ‘‘(VIII) education; 

22 ‘‘(IX) research; 

23 ‘‘(X) charitable contribution; 

24 ‘‘(XI) royalty or license; 


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1 ‘‘(XII) current or prospective 

2 ownership or investment interest; 

3 ‘‘(XIII) direct compensation for 

4 serving as faculty or as a speaker for 

5 a medical education program; 

6 ‘‘(XIV) grant; or 

7 ‘‘(XV) any other nature of the 

8 payment or other transfer of value (as 

9 defined by the Secretary). 

10 ‘‘(vii) If the payment or other transfer 

11 of value is related to marketing, education, 

12 or research specific to a covered drug, de13 vice, biological, or medical supply, the 

14 name of that covered drug, device, biologi15 cal, or medical supply. 

16 ‘‘(viii) Any other categories of infor17 mation regarding the payment or other 

18 transfer of value the Secretary determines 

19 appropriate. 

20 ‘‘(B) SPECIAL RULE FOR CERTAIN PAY21 MENTS OR OTHER TRANSFERS OF VALUE.—In 

22 the case where an applicable manufacturer pro23 vides a payment or other transfer of value to an 

24 entity or individual at the request of or des25 ignated on behalf of a covered recipient, the apVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01545 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 plicable manufacturer shall disclose that pay2 ment or other transfer of value under the name 

3 of the covered recipient. 

4 ‘‘(2) PHYSICIAN OWNERSHIP.—In addition to 

5 the requirement under paragraph (1)(A), on March 

6 31, 2013, and on the 90th day of each calendar year 

7 beginning thereafter, any applicable manufacturer or 

8 applicable group purchasing organization shall sub9 mit to the Secretary, in such electronic form as the 

10 Secretary shall require, the following information re11 garding any ownership or investment interest (other 

12 than an ownership or investment interest in a pub13 licly traded security and mutual fund, as described 

14 in section 1877(c)) held by a physician (or an imme15 diate family member of such physician (as defined 

16 for purposes of section 1877(a))) in the applicable 

17 manufacturer or applicable group purchasing organi18 zation during the preceding year: 

19 ‘‘(A) The dollar amount invested by each 

20 physician holding such an ownership or invest21 ment interest. 

22 ‘‘(B) The value and terms of each such 

23 ownership or investment interest. 

24 ‘‘(C) Any payment or other transfer of 

25 value provided to a physician holding such an 


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1 ownership or investment interest (or to an enti2 ty or individual at the request of or designated 

3 on behalf of a physician holding such an owner4 ship or investment interest), including the infor5 mation described in clauses (i) through (viii) of 

6 paragraph (1)(A), except that in applying such 

7 clauses, ‘physician’ shall be substituted for ‘cov8 ered recipient’ each place it appears. 

9 ‘‘(D) Any other information regarding the 

10 ownership or investment interest the Secretary 

11 determines appropriate. 

12 ‘‘(b) PENALTIES FOR NONCOMPLIANCE.— 

13 ‘‘(1) FAILURE TO REPORT.— 

14 ‘‘(A) IN GENERAL.—Subject to subpara15 graph (B) except as provided in paragraph (2), 

16 any applicable manufacturer or applicable 

17 group purchasing organization that fails to sub18 mit information required under subsection (a) 

19 in a timely manner in accordance with rules or 

20 regulations promulgated to carry out such sub21 section, shall be subject to a civil money penalty 

22 of not less than $1,000, but not more than 

23 $10,000, for each payment or other transfer of 

24 value or ownership or investment interest not 

25 reported as required under such subsection. 


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1 Such penalty shall be imposed and collected in 

2 the same manner as civil money penalties under 

3 subsection (a) of section 1128A are imposed 

4 and collected under that section. 

5 ‘‘(B) LIMITATION.—The total amount of 

6 civil money penalties imposed under subpara7 graph (A) with respect to each annual submis8 sion of information under subsection (a) by an 

9 applicable manufacturer or applicable group 

10 purchasing organization shall not exceed 

11 $150,000. 

12 ‘‘(2) KNOWING FAILURE TO REPORT.— 

13 ‘‘(A) IN GENERAL.—Subject to subpara14 graph (B), any applicable manufacturer or ap15 plicable group purchasing organization that 

16 knowingly fails to submit information required 

17 under subsection (a) in a timely manner in ac18 cordance with rules or regulations promulgated 

19 to carry out such subsection, shall be subject to 

20 a civil money penalty of not less than $10,000, 

21 but not more than $100,000, for each payment 

22 or other transfer of value or ownership or in23 vestment interest not reported as required 

24 under such subsection. Such penalty shall be 

25 imposed and collected in the same manner as 


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1 civil money penalties under subsection (a) of 

2 section 1128A are imposed and collected under 

3 that section. 

4 ‘‘(B) LIMITATION.—The total amount of 

5 civil money penalties imposed under subpara6 graph (A) with respect to each annual submis7 sion of information under subsection (a) by an 

8 applicable manufacturer or applicable group 

9 purchasing organization shall not exceed 

10 $1,000,000. 

11 ‘‘(3) USE OF FUNDS.—Funds collected by the 

12 Secretary as a result of the imposition of a civil 

13 money penalty under this subsection shall be used to 

14 carry out this section. 

15 ‘‘(c) PROCEDURES FOR SUBMISSION OF INFORMA16 TION AND PUBLIC AVAILABILITY.— 

17 ‘‘(1) IN GENERAL.— 

18 ‘‘(A) ESTABLISHMENT.—Not later than 

19 October 1, 2011, the Secretary shall establish 

20 procedures— 

21 ‘‘(i) for applicable manufacturers and 

22 applicable group purchasing organizations 

23 to submit information to the Secretary 

24 under subsection (a); and 


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1 ‘‘(ii) for the Secretary to make such 

2 information submitted available to the pub3 lic. 

4 ‘‘(B) DEFINITION OF TERMS.—The proce5 dures established under subparagraph (A) shall 

6 provide for the definition of terms (other than 

7 those terms defined in subsection (e)), as ap8 propriate, for purposes of this section. 

9 ‘‘(C) PUBLIC AVAILABILITY.—Except as 

10 provided in subparagraph (E), the procedures 

11 established under subparagraph (A)(ii) shall en12 sure that, not later than September 30, 2013, 

13 and on June 30 of each calendar year beginning 

14 thereafter, the information submitted under 

15 subsection (a) with respect to the preceding cal16 endar year is made available through an Inter17 net website that— 

18 ‘‘(i) is searchable and is in a format 

19 that is clear and understandable; 

20 ‘‘(ii) contains information that is pre21 sented by the name of the applicable man22 ufacturer or applicable group purchasing 

23 organization, the name of the covered re24 cipient, the business address of the covered 

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1 cipient, the value of the payment or other 

2 transfer of value, the date on which the 

3 payment or other transfer of value was 

4 provided to the covered recipient, the form 

5 of the payment or other transfer of value, 

6 indicated (as appropriate) under subsection 

7 (a)(1)(A)(v), the nature of the payment or 

8 other transfer of value, indicated (as ap9 propriate) under subsection (a)(1)(A)(vi), 

10 and the name of the covered drug, device, 

11 biological, or medical supply, as applicable; 

12 ‘‘(iii) contains information that is able 

13 to be easily aggregated and downloaded; 

14 ‘‘(iv) contains a description of any en15 forcement actions taken to carry out this 

16 section, including any penalties imposed 

17 under subsection (b), during the preceding 

18 year; 

19 ‘‘(v) contains background information 

20 on industry-physician relationships; 

21 ‘‘(vi) in the case of information sub22 mitted with respect to a payment or other 

23 transfer of value described in subpara24 graph (E)(i), lists such information sepa25 rately from the other information subVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01551 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 mitted under subsection (a) and designates 

2 such separately listed information as fund3 ing for clinical research; 

4 ‘‘(vii) contains any other information 

5 the Secretary determines would be helpful 

6 to the average consumer; 

7 ‘‘(viii) does not contain the National 

8 Provider Identifier of the covered recipient, 

9 and 

10 ‘‘(ix) subject to subparagraph (D), 

11 provides the applicable manufacturer, ap12 plicable group purchasing organization, or 

13 covered recipient an opportunity to review 

14 and submit corrections to the information 

15 submitted with respect to the applicable 

16 manufacturer, applicable group purchasing 

17 organization, or covered recipient, respec18 tively, for a period of not less than 45 days 

19 prior to such information being made 

20 available to the public. 

21 ‘‘(D) CLARIFICATION OF TIME PERIOD FOR

22 REVIEW AND CORRECTIONS.—In no case may 

23 the 45-day period for review and submission of 

24 corrections to information under subparagraph 

25 (C)(ix) prevent such information from being 


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1 made available to the public in accordance with 

2 the dates described in the matter preceding 

3 clause (i) in subparagraph (C). 

4 ‘‘(E) DELAYED PUBLICATION FOR PAY5 MENTS MADE PURSUANT TO PRODUCT RE6 SEARCH OR DEVELOPMENT AGREEMENTS AND

7 CLINICAL INVESTIGATIONS.— 

8 ‘‘(i) IN GENERAL.—In the case of in9 formation submitted under subsection (a) 

10 with respect to a payment or other transfer 

11 of value made to a covered recipient by an 

12 applicable manufacturer pursuant to a 

13 product research or development agree14 ment for services furnished in connection 

15 with research on a potential new medical 

16 technology or a new application of an ex17 isting medical technology or the develop18 ment of a new drug, device, biological, or 

19 medical supply, or by an applicable manu20 facturer in connection with a clinical inves21 tigation regarding a new drug, device, bio22 logical, or medical supply, the procedures 

23 established under subparagraph (A)(ii) 

24 shall provide that such information is 

25 made available to the public on the first 


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1 date described in the matter preceding 

2 clause (i) in subparagraph (C) after the 

3 earlier of the following: 

4 ‘‘(I) The date of the approval or 

5 clearance of the covered drug, device, 

6 biological, or medical supply by the 

7 Food and Drug Administration. 

8 ‘‘(II) Four calendar years after 

9 the date such payment or other trans10 fer of value was made. 

11 ‘‘(ii) CONFIDENTIALITY OF INFORMA12 TION PRIOR TO PUBLICATION.—Informa13 tion described in clause (i) shall be consid14 ered confidential and shall not be subject 

15 to disclosure under section 552 of title 5, 

16 United States Code, or any other similar 

17 Federal, State, or local law, until on or 

18 after the date on which the information is 

19 made available to the public under such 

20 clause. 

21 ‘‘(2) CONSULTATION.—In establishing the pro22 cedures under paragraph (1), the Secretary shall 

23 consult with the Inspector General of the Depart24 ment of Health and Human Services, affected indus25 try, consumers, consumer advocates, and other interVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01554 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ested parties in order to ensure that the information 

2 made available to the public under such paragraph 

3 is presented in the appropriate overall context. 

4 ‘‘(d) ANNUAL REPORTS AND RELATION TO STATE

5 LAWS.— 

6 ‘‘(1) ANNUAL REPORT TO CONGRESS.—Not 

7 later than April 1 of each year beginning with 2013, 

8 the Secretary shall submit to Congress a report that 

9 includes the following: 

10 ‘‘(A) The information submitted under 

11 subsection (a) during the preceding year, aggre12 gated for each applicable manufacturer and ap13 plicable group purchasing organization that 

14 submitted such information during such year 

15 (except, in the case of information submitted 

16 with respect to a payment or other transfer of 

17 value described in subsection (c)(1)(E)(i), such 

18 information shall be included in the first report 

19 submitted to Congress after the date on which 

20 such information is made available to the public 

21 under such subsection). 

22 ‘‘(B) A description of any enforcement ac23 tions taken to carry out this section, including 

24 any penalties imposed under subsection (b), 

25 during the preceding year. 


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1 ‘‘(2) ANNUAL REPORTS TO STATES.—Not later 

2 than September 30, 2013 and on June 30 of each 

3 calendar year thereafter, the Secretary shall submit 

4 to States a report that includes a summary of the 

5 information submitted under subsection (a) during 

6 the preceding year with respect to covered recipients 

7 in the State (except, in the case of information sub8 mitted with respect to a payment or other transfer 

9 of value described in subsection (c)(1)(E)(i), such in10 formation shall be included in the first report sub11 mitted to States after the date on which such infor12 mation is made available to the public under such 

13 subsection). 

14 ‘‘(3) RELATION TO STATE LAWS.— 

15 ‘‘(A) IN GENERAL.—In the case of a pay16 ment or other transfer of value provided by an 

17 applicable manufacturer that is received by a 

18 covered recipient (as defined in subsection (e)) 

19 on or after January 1, 2012, subject to sub20 paragraph (B), the provisions of this section 

21 shall preempt any statute or regulation of a 

22 State or of a political subdivision of a State 

23 that requires an applicable manufacturer (as so 

24 defined) to disclose or report, in any format, 

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1 section (a)) regarding such payment or other 

2 transfer of value. 

3 ‘‘(B) NO PREEMPTION OF ADDITIONAL RE4 QUIREMENTS.—Subparagraph (A) shall not 

5 preempt any statute or regulation of a State or 

6 of a political subdivision of a State that re7 quires the disclosure or reporting of informa8 tion— 

9 ‘‘(i) not of the type required to be dis10 closed or reported under this section; 

11 ‘‘(ii) described in subsection 

12 (e)(10)(B), except in the case of informa13 tion described in clause (i) of such sub14 section; 

15 ‘‘(iii) by any person or entity other 

16 than an applicable manufacturer (as so de17 fined) or a covered recipient (as defined in 

18 subsection (e)); or 

19 ‘‘(iv) to a Federal, State, or local gov20 ernmental agency for public health surveil21 lance, investigation, or other public health 

22 purposes or health oversight purposes. 

23 ‘‘(C) Nothing in subparagraph (A) shall be 

24 construed to limit the discovery or admissibility 

25 of information described in such subparagraph 


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1 in a criminal, civil, or administrative pro2 ceeding. 

3 ‘‘(4) CONSULTATION.—The Secretary shall con4 sult with the Inspector General of the Department 

5 of Health and Human Services on the implementa6 tion of this section. 

7 ‘‘(e) DEFINITIONS.—In this section: 

8 ‘‘(1) APPLICABLE GROUP PURCHASING ORGANI9 ZATION.—The term ‘applicable group purchasing or10 ganization’ means a group purchasing organization 

11 (as defined by the Secretary) that purchases, ar12 ranges for, or negotiates the purchase of a covered 

13 drug, device, biological, or medical supply which is 

14 operating in the United States, or in a territory, 

15 possession, or commonwealth of the United States. 

16 ‘‘(2) APPLICABLE MANUFACTURER.—The term 

17 ‘applicable manufacturer’ means a manufacturer of 

18 a covered drug, device, biological, or medical supply 

19 which is operating in the United States, or in a ter20 ritory, possession, or commonwealth of the United 

21 States. 

22 ‘‘(3) CLINICAL INVESTIGATION.—The term 

23 ‘clinical investigation’ means any experiment involv24 ing 1 or more human subjects, or materials derived 


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1 from human subjects, in which a drug or device is 

2 administered, dispensed, or used. 

3 ‘‘(4) COVERED DEVICE.—The term ‘covered de4 vice’ means any device for which payment is avail5 able under title XVIII or a State plan under title 

6 XIX or XXI (or a waiver of such a plan). 

7 ‘‘(5) COVERED DRUG, DEVICE, BIOLOGICAL, OR

8 MEDICAL SUPPLY.—The term ‘covered drug, device, 

9 biological, or medical supply’ means any drug, bio10 logical product, device, or medical supply for which 

11 payment is available under title XVIII or a State 

12 plan under title XIX or XXI (or a waiver of such 

13 a plan). 

14 ‘‘(6) COVERED RECIPIENT.— 

15 ‘‘(A) IN GENERAL.—Except as provided in 

16 subparagraph (B), the term ‘covered recipient’ 

17 means the following: 

18 ‘‘(i) A physician. 

19 ‘‘(ii) A teaching hospital. 

20 ‘‘(B) EXCLUSION.—Such term does not in21 clude a physician who is an employee of the ap22 plicable manufacturer that is required to submit 

23 information under subsection (a). 

24 ‘‘(7) EMPLOYEE.—The term ‘employee’ has the 

25 meaning given such term in section 1877(h)(2). 


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1 ‘‘(8) KNOWINGLY.—The term ‘knowingly’ has 

2 the meaning given such term in section 3729(b) of 

3 title 31, United States Code. 

4 ‘‘(9) MANUFACTURER OF A COVERED DRUG, 

5 DEVICE, BIOLOGICAL, OR MEDICAL SUPPLY.—The 

6 term ‘manufacturer of a covered drug, device, bio7 logical, or medical supply’ means any entity which is 

8 engaged in the production, preparation, propagation, 

9 compounding, or conversion of a covered drug, de10 vice, biological, or medical supply (or any entity 

11 under common ownership with such entity which 

12 provides assistance or support to such entity with re13 spect to the production, preparation, propagation, 

14 compounding, conversion, marketing, promotion, 

15 sale, or distribution of a covered drug, device, bio16 logical, or medical supply). 

17 ‘‘(10) PAYMENT OR OTHER TRANSFER OF

18 VALUE.— 

19 ‘‘(A) IN GENERAL.—The term ‘payment or 

20 other transfer of value’ means a transfer of 

21 anything of value. Such term does not include 

22 a transfer of anything of value that is made in23 directly to a covered recipient through a third 

24 party in connection with an activity or service 

25 in the case where the applicable manufacturer 


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1 is unaware of the identity of the covered recipi2 ent. 

3 ‘‘(B) EXCLUSIONS.—An applicable manu4 facturer shall not be required to submit infor5 mation under subsection (a) with respect to the 

6 following: 

7 ‘‘(i) A transfer of anything the value 

8 of which is less than $10, unless the aggre9 gate amount transferred to, requested by, 

10 or designated on behalf of the covered re11 cipient by the applicable manufacturer dur12 ing the calendar year exceeds $100. For 

13 calendar years after 2012, the dollar 

14 amounts specified in the preceding sen15 tence shall be increased by the same per16 centage as the percentage increase in the 

17 consumer price index for all urban con18 sumers (all items; U.S. city average) for 

19 the 12-month period ending with June of 

20 the previous year. 

21 ‘‘(ii) Product samples that are not in22 tended to be sold and are intended for pa23 tient use. 


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1 ‘‘(iii) Educational materials that di2 rectly benefit patients or are intended for 

3 patient use. 

4 ‘‘(iv) The loan of a covered device for 

5 a short-term trial period, not to exceed 90 

6 days, to permit evaluation of the covered 

7 device by the covered recipient. 

8 ‘‘(v) Items or services provided under 

9 a contractual warranty, including the re10 placement of a covered device, where the 

11 terms of the warranty are set forth in the 

12 purchase or lease agreement for the cov13 ered device. 

14 ‘‘(vi) A transfer of anything of value 

15 to a covered recipient when the covered re16 cipient is a patient and not acting in the 

17 professional capacity of a covered recipient. 

18 ‘‘(vii) Discounts (including rebates). 

19 ‘‘(viii) In-kind items used for the pro20 vision of charity care. 

21 ‘‘(ix) A dividend or other profit dis22 tribution from, or ownership or investment 

23 interest in, a publicly traded security and 

24 mutual fund (as described in section 

25 1877(c)). 


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1 ‘‘(x) In the case of an applicable man2 ufacturer who offers a self-insured plan, 

3 payments for the provision of health care 

4 to employees under the plan. 

5 ‘‘(xi) In the case of a covered recipi6 ent who is a licensed non-medical profes7 sional, a transfer of anything of value to 

8 the covered recipient if the transfer is pay9 ment solely for the non-medical profes10 sional services of such licensed non-medical 

11 professional. 

12 ‘‘(xii) In the case of a covered recipi13 ent who is a physician, a transfer of any14 thing of value to the covered recipient if 

15 the transfer is payment solely for the serv16 ices of the covered recipient with respect to 

17 a civil or criminal action or an administra18 tive proceeding. 

19 ‘‘(11) PHYSICIAN.—The term ‘physician’ has 

20 the meaning given that term in section 1861(r).’’. 


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1 SEC. 6003. DISCLOSURE REQUIREMENTS FOR IN-OFFICE 

2 ANCILLARY SERVICES EXCEPTION TO THE 

3 PROHIBITION ON PHYSICIAN SELF-REFER4 RAL FOR CERTAIN IMAGING SERVICES. 

5 (a) IN GENERAL.—Section 1877(b)(2) of the Social 

6 Security Act (42 U.S.C. 1395nn(b)(2)) is amended by 

7 adding at the end the following new sentence: ‘‘Such re8 quirements shall, with respect to magnetic resonance im9 aging, computed tomography, positron emission tomog10 raphy, and any other designated health services specified 

11 under subsection (h)(6)(D) that the Secretary determines 

12 appropriate, include a requirement that the referring phy13 sician inform the individual in writing at the time of the 

14 referral that the individual may obtain the services for 

15 which the individual is being referred from a person other 

16 than a person described in subparagraph (A)(i) and pro17 vide such individual with a written list of suppliers (as 

18 defined in section 1861(d)) who furnish such services in 

19 the area in which such individual resides.’’. 

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

21 this section shall apply to services furnished on or after 

22 January 1, 2010. 

23 SEC. 6004. PRESCRIPTION DRUG SAMPLE TRANSPARENCY. 

24 Part A of title XI of the Social Security Act (42 

25 U.S.C. 1301 et seq.), as amended by section 6002, is 


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1 amended by inserting after section 1128G the following 

2 new section: 

3 ‘‘SEC. 1128H. REPORTING OF INFORMATION RELATING TO 

4 DRUG SAMPLES. 

5 ‘‘(a) IN GENERAL.—Not later than April 1 of each 

6 year (beginning with 2012), each manufacturer and au7 thorized distributor of record of an applicable drug shall 

8 submit to the Secretary (in a form and manner specified 

9 by the Secretary) the following information with respect 

10 to the preceding year: 

11 ‘‘(1) In the case of a manufacturer or author12 ized distributor of record which makes distributions 

13 by mail or common carrier under subsection (d)(2) 

14 of section 503 of the Federal Food, Drug, and Cos15 metic Act (21 U.S.C. 353), the identity and quantity 

16 of drug samples requested and the identity and 

17 quantity of drug samples distributed under such 

18 subsection during that year, aggregated by— 

19 ‘‘(A) the name, address, professional des20 ignation, and signature of the practitioner mak21 ing the request under subparagraph (A)(i) of 

22 such subsection, or of any individual who makes 

23 or signs for the request on behalf of the practi24 tioner; and 


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1 ‘‘(B) any other category of information de2 termined appropriate by the Secretary. 

3 ‘‘(2) In the case of a manufacturer or author4 ized distributor of record which makes distributions 

5 by means other than mail or common carrier under 

6 subsection (d)(3) of such section 503, the identity 

7 and quantity of drug samples requested and the 

8 identity and quantity of drug samples distributed 

9 under such subsection during that year, aggregated 

10 by— 

11 ‘‘(A) the name, address, professional des12 ignation, and signature of the practitioner mak13 ing the request under subparagraph (A)(i) of 

14 such subsection, or of any individual who makes 

15 or signs for the request on behalf of the practi16 tioner; and 

17 ‘‘(B) any other category of information de18 termined appropriate by the Secretary. 

19 ‘‘(b) DEFINITIONS.—In this section: 

20 ‘‘(1) APPLICABLE DRUG.—The term ‘applicable 

21 drug’ means a drug— 

22 ‘‘(A) which is subject to subsection (b) of 

23 such section 503; and 


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1 ‘‘(B) for which payment is available under 

2 title XVIII or a State plan under title XIX or 

3 XXI (or a waiver of such a plan). 

4 ‘‘(2) AUTHORIZED DISTRIBUTOR OF RECORD.— 

5 The term ‘authorized distributor of record’ has the 

6 meaning given that term in subsection (e)(3)(A) of 

7 such section. 

8 ‘‘(3) MANUFACTURER.—The term ‘manufac9 turer’ has the meaning given that term for purposes 

10 of subsection (d) of such section.’’. 

11 SEC. 6005. PHARMACY BENEFIT MANAGERS TRANS12 PARENCY REQUIREMENTS. 

13 Part A of title XI of the Social Security Act (42 

14 U.S.C. 1301 et seq.) is amended by inserting after section 

15 1150 the following new section: 

16 ‘‘SEC. 1150A. PHARMACY BENEFIT MANAGERS TRANS17 PARENCY REQUIREMENTS. 

18 ‘‘(a) PROVISION OF INFORMATION.—A health bene19 fits plan or any entity that provides pharmacy benefits 

20 management services on behalf of a health benefits plan 

21 (in this section referred to as a ‘PBM’) that manages pre22 scription drug coverage under a contract with— 

23 ‘‘(1) a PDP sponsor of a prescription drug plan 

24 or an MA organization offering an MA–PD plan 

25 under part D of title XVIII; or 


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1 ‘‘(2) a qualified health benefits plan offered 

2 through an exchange established by a State under 

3 section 1311 of the Patient Protection and Afford4 able Care Act, 

5 shall provide the information described in subsection (b) 

6 to the Secretary and, in the case of a PBM, to the plan 

7 with which the PBM is under contract with, at such times, 

8 and in such form and manner, as the Secretary shall speci9 fy. 

10 ‘‘(b) INFORMATION DESCRIBED.—The information 

11 described in this subsection is the following with respect 

12 to services provided by a health benefits plan or PBM for 

13 a contract year: 

14 ‘‘(1) The percentage of all prescriptions that 

15 were provided through retail pharmacies compared 

16 to mail order pharmacies, and the percentage of pre17 scriptions for which a generic drug was available and 

18 dispensed (generic dispensing rate), by pharmacy 

19 type (which includes an independent pharmacy, 

20 chain pharmacy, supermarket pharmacy, or mass 

21 merchandiser pharmacy that is licensed as a phar22 macy by the State and that dispenses medication to 

23 the general public), that is paid by the health bene24 fits plan or PBM under the contract. 


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1 ‘‘(2) The aggregate amount, and the type of re2 bates, discounts, or price concessions (excluding 

3 bona fide service fees, which include but are not lim4 ited to distribution service fees, inventory manage5 ment fees, product stocking allowances, and fees as6 sociated with administrative services agreements and 

7 patient care programs (such as medication compli8 ance programs and patient education programs))that 

9 the PBM negotiates that are attributable to patient 

10 utilization under the plan, and the aggregate amount 

11 of the rebates, discounts, or price concessions that 

12 are passed through to the plan sponsor, and the 

13 total number of prescriptions that were dispensed. 

14 ‘‘(3) The aggregate amount of the difference 

15 between the amount the health benefits plan pays 

16 the PBM and the amount that the PBM pays retail 

17 pharmacies, and mail order pharmacies, and the 

18 total number of prescriptions that were dispensed. 

19 ‘‘(c) CONFIDENTIALITY.—Information disclosed by a 

20 health benefits plan or PBM under this section is con21 fidential and shall not be disclosed by the Secretary or 

22 by a plan receiving the information, except that the Sec23 retary may disclose the information in a form which does 

24 not disclose the identity of a specific PBM, plan, or prices 

25 charged for drugs, for the following purposes: 


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1 ‘‘(1) As the Secretary determines to be nec2 essary to carry out this section or part D of title 

3 XVIII. 

4 ‘‘(2) To permit the Comptroller General to re5 view the information provided. 

6 ‘‘(3) To permit the Director of the Congres7 sional Budget Office to review the information pro8 vided. 

9 ‘‘(4) To States to carry out section 1311 of the 

10 Patient Protection and Affordable Care Act. 

11 ‘‘(d) PENALTIES.—The provisions of subsection 

12 (b)(3)(C) of section 1927 shall apply to a health benefits 

13 plan or PBM that fails to provide information required 

14 under subsection (a) on a timely basis or that knowingly 

15 provides false information in the same manner as such 

16 provisions apply to a manufacturer with an agreement 

17 under that section.’’. 


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1 Subtitle B—Nursing Home 

2 Transparency and Improvement 

3 PART I—IMPROVING TRANSPARENCY OF 

4 INFORMATION 

5 SEC. 6101. REQUIRED DISCLOSURE OF OWNERSHIP AND 

6 ADDITIONAL DISCLOSABLE PARTIES INFOR7 MATION. 

8 (a) IN GENERAL.—Section 1124 of the Social Secu9 rity Act (42 U.S.C. 1320a–3) is amended by adding at 

10 the end the following new subsection: 

11 ‘‘(c) REQUIRED DISCLOSURE OF OWNERSHIP AND

12 ADDITIONAL DISCLOSABLE PARTIES INFORMATION.— 

13 ‘‘(1) DISCLOSURE.—A facility shall have the in14 formation described in paragraph (2) available— 

15 ‘‘(A) during the period beginning on the 

16 date of the enactment of this subsection and 

17 ending on the date such information is made 

18 available to the public under section 6101(b) of 

19 the Patient Protection and Affordable Care Act 

20 for submission to the Secretary, the Inspector 

21 General of the Department of Health and 

22 Human Services, the State in which the facility 

23 is located, and the State long-term care om24 budsman in the case where the Secretary, the 

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1 term care ombudsman requests such informa2 tion; and 

3 ‘‘(B) beginning on the effective date of the 

4 final regulations promulgated under paragraph 

5 (3)(A), for reporting such information in ac6 cordance with such final regulations. 

7 Nothing in subparagraph (A) shall be construed as 

8 authorizing a facility to dispose of or delete informa9 tion described in such subparagraph after the effec10 tive date of the final regulations promulgated under 

11 paragraph (3)(A). 

12 ‘‘(2) INFORMATION DESCRIBED.— 

13 ‘‘(A) IN GENERAL.—The following infor14 mation is described in this paragraph: 

15 ‘‘(i) The information described in sub16 sections (a) and (b), subject to subpara17 graph (C). 

18 ‘‘(ii) The identity of and information 

19 on— 

20 ‘‘(I) each member of the gov21 erning body of the facility, including 

22 the name, title, and period of service 

23 of each such member; 

24 ‘‘(II) each person or entity who is 

25 an officer, director, member, partner, 


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1 trustee, or managing employee of the 

2 facility, including the name, title, and 

3 period of service of each such person 

4 or entity; and 

5 ‘‘(III) each person or entity who 

6 is an additional disclosable party of 

7 the facility. 

8 ‘‘(iii) The organizational structure of 

9 each additional disclosable party of the fa10 cility and a description of the relationship 

11 of each such additional disclosable party to 

12 the facility and to one another. 

13 ‘‘(B) SPECIAL RULE WHERE INFORMATION

14 IS ALREADY REPORTED OR SUBMITTED.—To 

15 the extent that information reported by a facil16 ity to the Internal Revenue Service on Form 

17 990, information submitted by a facility to the 

18 Securities and Exchange Commission, or infor19 mation otherwise submitted to the Secretary or 

20 any other Federal agency contains the informa21 tion described in clauses (i), (ii), or (iii) of sub22 paragraph (A), the facility may provide such 

23 Form or such information submitted to meet 

24 the requirements of paragraph (1). 


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1 ‘‘(C) SPECIAL RULE.—In applying sub2 paragraph (A)(i)— 

3 ‘‘(i) with respect to subsections (a) 

4 and (b), ‘ownership or control interest’ 

5 shall include direct or indirect interests, in6 cluding such interests in intermediate enti7 ties; and 

8 ‘‘(ii) subsection (a)(3)(A)(ii) shall in9 clude the owner of a whole or part interest 

10 in any mortgage, deed of trust, note, or 

11 other obligation secured, in whole or in 

12 part, by the entity or any of the property 

13 or assets thereof, if the interest is equal to 

14 or exceeds 5 percent of the total property 

15 or assets of the entirety. 

16 ‘‘(3) REPORTING.— 

17 ‘‘(A) IN GENERAL.—Not later than the 

18 date that is 2 years after the date of the enact19 ment of this subsection, the Secretary shall pro20 mulgate final regulations requiring, effective on 

21 the date that is 90 days after the date on which 

22 such final regulations are published in the Fed23 eral Register, a facility to report the informa24 tion described in paragraph (2) to the Secretary 

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1 lations as are necessary to carry out this sub2 section. Such final regulations shall ensure that 

3 the facility certifies, as a condition of participa4 tion and payment under the program under 

5 title XVIII or XIX, that the information re6 ported by the facility in accordance with such 

7 final regulations is, to the best of the facility’s 

8 knowledge, accurate and current. 

9 ‘‘(B) GUIDANCE.—The Secretary shall pro10 vide guidance and technical assistance to States 

11 on how to adopt the standardized format under 

12 subparagraph (A). 

13 ‘‘(4) NO EFFECT ON EXISTING REPORTING RE14 QUIREMENTS.—Nothing in this subsection shall re15 duce, diminish, or alter any reporting requirement 

16 for a facility that is in effect as of the date of the 

17 enactment of this subsection. 

18 ‘‘(5) DEFINITIONS.—In this subsection: 

19 ‘‘(A) ADDITIONAL DISCLOSABLE PARTY.— 

20 The term ‘additional disclosable party’ means, 

21 with respect to a facility, any person or entity 

22 who— 

23 ‘‘(i) exercises operational, financial, or 

24 managerial control over the facility or a 

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1 dures for any of the operations of the facil2 ity, or provides financial or cash manage3 ment services to the facility; 

4 ‘‘(ii) leases or subleases real property 

5 to the facility, or owns a whole or part in6 terest equal to or exceeding 5 percent of 

7 the total value of such real property; or 

8 ‘‘(iii) provides management or admin9 istrative services, management or clinical 

10 consulting services, or accounting or finan11 cial services to the facility. 

12 ‘‘(B) FACILITY.—The term ‘facility’ means 

13 a disclosing entity which is— 

14 ‘‘(i) a skilled nursing facility (as de15 fined in section 1819(a)); or 

16 ‘‘(ii) a nursing facility (as defined in 

17 section 1919(a)). 

18 ‘‘(C) MANAGING EMPLOYEE.—The term 

19 ‘managing employee’ means, with respect to a 

20 facility, an individual (including a general man21 ager, business manager, administrator, director, 

22 or consultant) who directly or indirectly man23 ages, advises, or supervises any element of the 

24 practices, finances, or operations of the facility. 


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1 ‘‘(D) ORGANIZATIONAL STRUCTURE.—The 

2 term ‘organizational structure’ means, in the 

3 case of— 

4 ‘‘(i) a corporation, the officers, direc5 tors, and shareholders of the corporation 

6 who have an ownership interest in the cor7 poration which is equal to or exceeds 5 

8 percent; 

9 ‘‘(ii) a limited liability company, the 

10 members and managers of the limited li11 ability company (including, as applicable, 

12 what percentage each member and man13 ager has of the ownership interest in the 

14 limited liability company); 

15 ‘‘(iii) a general partnership, the part16 ners of the general partnership; 

17 ‘‘(iv) a limited partnership, the gen18 eral partners and any limited partners of 

19 the limited partnership who have an own20 ership interest in the limited partnership 

21 which is equal to or exceeds 10 percent; 

22 ‘‘(v) a trust, the trustees of the trust; 

23 ‘‘(vi) an individual, contact informa24 tion for the individual; and 


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1 ‘‘(vii) any other person or entity, such 

2 information as the Secretary determines 

3 appropriate.’’. 

4 (b) PUBLIC AVAILABILITY OF INFORMATION.—Not 

5 later than the date that is 1 year after the date on which 

6 the final regulations promulgated under section 

7 1124(c)(3)(A) of the Social Security Act, as added by sub8 section (a), are published in the Federal Register, the Sec9 retary of Health and Human Services shall make the in10 formation reported in accordance with such final regula11 tions available to the public in accordance with procedures 

12 established by the Secretary. 

13 (c) CONFORMING AMENDMENTS.— 

14 (1) IN GENERAL.— 

15 (A) SKILLED NURSING FACILITIES.—Sec16 tion 1819(d)(1) of the Social Security Act (42 

17 U.S.C. 1395i–3(d)(1)) is amended by striking 

18 subparagraph (B) and redesignating subpara19 graph (C) as subparagraph (B). 

20 (B) NURSING FACILITIES.—Section 

21 1919(d)(1) of the Social Security Act (42 

22 U.S.C. 1396r(d)(1)) is amended by striking 

23 subparagraph (B) and redesignating subpara24 graph (C) as subparagraph (B). 


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1 (2) EFFECTIVE DATE.—The amendments made 

2 by paragraph (1) shall take effect on the date on 

3 which the Secretary makes the information described 

4 in subsection (b)(1) available to the public under 

5 such subsection. 

6 SEC. 6102. ACCOUNTABILITY REQUIREMENTS FOR SKILLED 

7 NURSING FACILITIES AND NURSING FACILI8 TIES. 

9 Part A of title XI of the Social Security Act (42 

10 U.S.C. 1301 et seq.), as amended by sections 6002 and 

11 6004, is amended by inserting after section 1128H the 

12 following new section: 

13 ‘‘SEC. 1128I. ACCOUNTABILITY REQUIREMENTS FOR FACILI14 TIES. 

15 ‘‘(a) DEFINITION OF FACILITY.—In this section, the 

16 term ‘facility’ means— 

17 ‘‘(1) a skilled nursing facility (as defined in sec18 tion 1819(a)); or 

19 ‘‘(2) a nursing facility (as defined in section 

20 1919(a)). 

21 ‘‘(b) EFFECTIVE COMPLIANCE AND ETHICS PRO22 GRAMS.— 

23 ‘‘(1) REQUIREMENT.—On or after the date that 

24 is 36 months after the date of the enactment of this 

25 section, a facility shall, with respect to the entity 


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1 that operates the facility (in this subparagraph re2 ferred to as the ‘operating organization’ or ‘organi3 zation’), have in operation a compliance and ethics 

4 program that is effective in preventing and detecting 

5 criminal, civil, and administrative violations under 

6 this Act and in promoting quality of care consistent 

7 with regulations developed under paragraph (2). 

8 ‘‘(2) DEVELOPMENT OF REGULATIONS.— 

9 ‘‘(A) IN GENERAL.—Not later than the 

10 date that is 2 years after such date of the en11 actment, the Secretary, working jointly with the 

12 Inspector General of the Department of Health 

13 and Human Services, shall promulgate regula14 tions for an effective compliance and ethics pro15 gram for operating organizations, which may 

16 include a model compliance program. 

17 ‘‘(B) DESIGN OF REGULATIONS.—Such 

18 regulations with respect to specific elements or 

19 formality of a program shall, in the case of an 

20 organization that operates 5 or more facilities, 

21 vary with the size of the organization, such that 

22 larger organizations should have a more formal 

23 program and include established written policies 

24 defining the standards and procedures to be fol25 lowed by its employees. Such requirements may 


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1 specifically apply to the corporate level manage2 ment of multi unit nursing home chains. 

3 ‘‘(C) EVALUATION.—Not later than 3 

4 years after the date of the promulgation of reg5 ulations under this paragraph, the Secretary 

6 shall complete an evaluation of the compliance 

7 and ethics programs required to be established 

8 under this subsection. Such evaluation shall de9 termine if such programs led to changes in defi10 ciency citations, changes in quality perform11 ance, or changes in other metrics of patient 

12 quality of care. The Secretary shall submit to 

13 Congress a report on such evaluation and shall 

14 include in such report such recommendations 

15 regarding changes in the requirements for such 

16 programs as the Secretary determines appro17 priate. 

18 ‘‘(3) REQUIREMENTS FOR COMPLIANCE AND

19 ETHICS PROGRAMS.—In this subsection, the term 

20 ‘compliance and ethics program’ means, with respect 

21 to a facility, a program of the operating organization 

22 that— 

23 ‘‘(A) has been reasonably designed, imple24 mented, and enforced so that it generally will be 

25 effective in preventing and detecting criminal, 


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1 civil, and administrative violations under this 

2 Act and in promoting quality of care; and 

3 ‘‘(B) includes at least the required compo4 nents specified in paragraph (4). 

5 ‘‘(4) REQUIRED COMPONENTS OF PROGRAM.— 

6 The required components of a compliance and ethics 

7 program of an operating organization are the fol8 lowing: 

9 ‘‘(A) The organization must have estab10 lished compliance standards and procedures to 

11 be followed by its employees and other agents 

12 that are reasonably capable of reducing the 

13 prospect of criminal, civil, and administrative 

14 violations under this Act. 

15 ‘‘(B) Specific individuals within high-level 

16 personnel of the organization must have been 

17 assigned overall responsibility to oversee compli18 ance with such standards and procedures and 

19 have sufficient resources and authority to as20 sure such compliance. 

21 ‘‘(C) The organization must have used due 

22 care not to delegate substantial discretionary 

23 authority to individuals whom the organization 

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1 gage in criminal, civil, and administrative viola2 tions under this Act. 

3 ‘‘(D) The organization must have taken 

4 steps to communicate effectively its standards 

5 and procedures to all employees and other 

6 agents, such as by requiring participation in 

7 training programs or by disseminating publica8 tions that explain in a practical manner what is 

9 required. 

10 ‘‘(E) The organization must have taken 

11 reasonable steps to achieve compliance with its 

12 standards, such as by utilizing monitoring and 

13 auditing systems reasonably designed to detect 

14 criminal, civil, and administrative violations 

15 under this Act by its employees and other 

16 agents and by having in place and publicizing 

17 a reporting system whereby employees and 

18 other agents could report violations by others 

19 within the organization without fear of retribu20 tion. 

21 ‘‘(F) The standards must have been con22 sistently enforced through appropriate discipli23 nary mechanisms, including, as appropriate, 

24 discipline of individuals responsible for the fail25 ure to detect an offense. 


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1 ‘‘(G) After an offense has been detected, 

2 the organization must have taken all reasonable 

3 steps to respond appropriately to the offense 

4 and to prevent further similar offenses, includ5 ing any necessary modification to its program 

6 to prevent and detect criminal, civil, and admin7 istrative violations under this Act. 

8 ‘‘(H) The organization must periodically 

9 undertake reassessment of its compliance pro10 gram to identify changes necessary to reflect 

11 changes within the organization and its facili12 ties. 

13 ‘‘(c) QUALITY ASSURANCE AND PERFORMANCE IM14 PROVEMENT PROGRAM.— 

15 ‘‘(1) IN GENERAL.—Not later than December 

16 31, 2011, the Secretary shall establish and imple17 ment a quality assurance and performance improve18 ment program (in this subparagraph referred to as 

19 the ‘QAPI program’) for facilities, including multi 

20 unit chains of facilities. Under the QAPI program, 

21 the Secretary shall establish standards relating to 

22 quality assurance and performance improvement 

23 with respect to facilities and provide technical assist24 ance to facilities on the development of best prac25 tices in order to meet such standards. Not later than 


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1 1 year after the date on which the regulations are 

2 promulgated under paragraph (2), a facility must 

3 submit to the Secretary a plan for the facility to 

4 meet such standards and implement such best prac5 tices, including how to coordinate the implementa6 tion of such plan with quality assessment and assur7 ance activities conducted under sections 

8 1819(b)(1)(B) and 1919(b)(1)(B), as applicable. 

9 ‘‘(2) REGULATIONS.—The Secretary shall pro10 mulgate regulations to carry out this subsection.’’. 

11 SEC. 6103. NURSING HOME COMPARE MEDICARE WEBSITE. 

12 (a) SKILLED NURSING FACILITIES.— 

13 (1) IN GENERAL.—Section 1819 of the Social 

14 Security Act (42 U.S.C. 1395i–3) is amended— 

15 (A) by redesignating subsection (i) as sub16 section (j); and 

17 (B) by inserting after subsection (h) the 

18 following new subsection: 

19 ‘‘(i) NURSING HOME COMPARE WEBSITE.— 

20 ‘‘(1) INCLUSION OF ADDITIONAL INFORMA21 TION.— 

22 ‘‘(A) IN GENERAL.—The Secretary shall 

23 ensure that the Department of Health and 

24 Human Services includes, as part of the infor25 mation provided for comparison of nursing 


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1 homes on the official Internet website of the 

2 Federal Government for Medicare beneficiaries 

3 (commonly referred to as the ‘Nursing Home 

4 Compare’ Medicare website) (or a successor 

5 website), the following information in a manner 

6 that is prominent, updated on a timely basis, 

7 easily accessible, readily understandable to con8 sumers of long-term care services, and search9 able: 

10 ‘‘(i) Staffing data for each facility (in11 cluding resident census data and data on 

12 the hours of care provided per resident per 

13 day) based on data submitted under sec14 tion 1128I(g), including information on 

15 staffing turnover and tenure, in a format 

16 that is clearly understandable to con17 sumers of long-term care services and al18 lows such consumers to compare dif19 ferences in staffing between facilities and 

20 State and national averages for the facili21 ties. Such format shall include— 

22 ‘‘(I) concise explanations of how 

23 to interpret the data (such as a plain 

24 English explanation of data reflecting 


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1 ‘nursing home staff hours per resident 

2 day’); 

3 ‘‘(II) differences in types of staff 

4 (such as training associated with dif5 ferent categories of staff); 

6 ‘‘(III) the relationship between 

7 nurse staffing levels and quality of 

8 care; and 

9 ‘‘(IV) an explanation that appro10 priate staffing levels vary based on 

11 patient case mix. 

12 ‘‘(ii) Links to State Internet websites 

13 with information regarding State survey 

14 and certification programs, links to Form 

15 2567 State inspection reports (or a suc16 cessor form) on such websites, information 

17 to guide consumers in how to interpret and 

18 understand such reports, and the facility 

19 plan of correction or other response to 

20 such report. Any such links shall be posted 

21 on a timely basis. 

22 ‘‘(iii) The standardized complaint 

23 form developed under section 1128I(f), in24 cluding explanatory material on what com25 plaint forms are, how they are used, and 


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1 how to file a complaint with the State sur2 vey and certification program and the 

3 State long-term care ombudsman program. 

4 ‘‘(iv) Summary information on the 

5 number, type, severity, and outcome of 

6 substantiated complaints. 

7 ‘‘(v) The number of adjudicated in8 stances of criminal violations by a facility 

9 or the employees of a facility— 

10 ‘‘(I) that were committed inside 

11 the facility; 

12 ‘‘(II) with respect to such in13 stances of violations or crimes com14 mitted inside of the facility that were 

15 the violations or crimes of abuse, ne16 glect, and exploitation, criminal sexual 

17 abuse, or other violations or crimes 

18 that resulted in serious bodily injury; 

19 and 

20 ‘‘(III) the number of civil mone21 tary penalties levied against the facil22 ity, employees, contractors, and other 

23 agents. 

24 ‘‘(B) DEADLINE FOR PROVISION OF INFOR25 MATION.— 


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1 ‘‘(i) IN GENERAL.—Except as pro2 vided in clause (ii), the Secretary shall en3 sure that the information described in sub4 paragraph (A) is included on such website 

5 (or a successor website) not later than 1 

6 year after the date of the enactment of this 

7 subsection. 

8 ‘‘(ii) EXCEPTION.—The Secretary 

9 shall ensure that the information described 

10 in subparagraph (A)(i) is included on such 

11 website (or a successor website) not later 

12 than the date on which the requirements 

13 under section 1128I(g) are implemented. 

14 ‘‘(2) REVIEW AND MODIFICATION OF

15 WEBSITE.— 

16 ‘‘(A) IN GENERAL.—The Secretary shall 

17 establish a process— 

18 ‘‘(i) to review the accuracy, clarity of 

19 presentation, timeliness, and comprehen20 siveness of information reported on such 

21 website as of the day before the date of the 

22 enactment of this subsection; and 

23 ‘‘(ii) not later than 1 year after the 

24 date of the enactment of this subsection, to 

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1 ance with the review conducted under 

2 clause (i). 

3 ‘‘(B) CONSULTATION.—In conducting the 

4 review under subparagraph (A)(i), the Sec5 retary shall consult with— 

6 ‘‘(i) State long-term care ombudsman 

7 programs; 

8 ‘‘(ii) consumer advocacy groups; 

9 ‘‘(iii) provider stakeholder groups; and 

10 ‘‘(iv) any other representatives of pro11 grams or groups the Secretary determines 

12 appropriate.’’. 

13 (2) TIMELINESS OF SUBMISSION OF SURVEY

14 AND CERTIFICATION INFORMATION.— 

15 (A) IN GENERAL.—Section 1819(g)(5) of 

16 the Social Security Act (42 U.S.C. 1395i– 

17 3(g)(5)) is amended by adding at the end the 

18 following new subparagraph: 

19 ‘‘(E) SUBMISSION OF SURVEY AND CER20 TIFICATION INFORMATION TO THE SEC21 RETARY.—In order to improve the timeliness of 

22 information made available to the public under 

23 subparagraph (A) and provided on the Nursing 

24 Home Compare Medicare website under sub25 section (i), each State shall submit information 


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1 respecting any survey or certification made re2 specting a skilled nursing facility (including any 

3 enforcement actions taken by the State) to the 

4 Secretary not later than the date on which the 

5 State sends such information to the facility. 

6 The Secretary shall use the information sub7 mitted under the preceding sentence to update 

8 the information provided on the Nursing Home 

9 Compare Medicare website as expeditiously as 

10 practicable but not less frequently than quar11 terly.’’. 

12 (B) EFFECTIVE DATE.—The amendment 

13 made by this paragraph shall take effect 1 year 

14 after the date of the enactment of this Act. 

15 (3) SPECIAL FOCUS FACILITY PROGRAM.—Sec16 tion 1819(f) of the Social Security Act (42 U.S.C. 

17 1395i–3(f)) is amended by adding at the end the fol18 lowing new paragraph: 

19 ‘‘(8) SPECIAL FOCUS FACILITY PROGRAM.— 

20 ‘‘(A) IN GENERAL.—The Secretary shall 

21 conduct a special focus facility program for en22 forcement of requirements for skilled nursing 

23 facilities that the Secretary has identified as 

24 having substantially failed to meet applicable 

25 requirement of this Act. 


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1 ‘‘(B) PERIODIC SURVEYS.—Under such 

2 program the Secretary shall conduct surveys of 

3 each facility in the program not less than once 

4 every 6 months.’’. 

5 (b) NURSING FACILITIES.— 

6 (1) IN GENERAL.—Section 1919 of the Social 

7 Security Act (42 U.S.C. 1396r) is amended— 

8 (A) by redesignating subsection (i) as sub9 section (j); and 

10 (B) by inserting after subsection (h) the 

11 following new subsection: 

12 ‘‘(i) NURSING HOME COMPARE WEBSITE.— 

13 ‘‘(1) INCLUSION OF ADDITIONAL INFORMA14 TION.— 

15 ‘‘(A) IN GENERAL.—The Secretary shall 

16 ensure that the Department of Health and 

17 Human Services includes, as part of the infor18 mation provided for comparison of nursing 

19 homes on the official Internet website of the 

20 Federal Government for Medicare beneficiaries 

21 (commonly referred to as the ‘Nursing Home 

22 Compare’ Medicare website) (or a successor 

23 website), the following information in a manner 

24 that is prominent, updated on a timely basis, 

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1 sumers of long-term care services, and search2 able: 

3 ‘‘(i) Staffing data for each facility (in4 cluding resident census data and data on 

5 the hours of care provided per resident per 

6 day) based on data submitted under sec7 tion 1128I(g), including information on 

8 staffing turnover and tenure, in a format 

9 that is clearly understandable to con10 sumers of long-term care services and al11 lows such consumers to compare dif12 ferences in staffing between facilities and 

13 State and national averages for the facili14 ties. Such format shall include— 

15 ‘‘(I) concise explanations of how 

16 to interpret the data (such as plain 

17 English explanation of data reflecting 

18 ‘nursing home staff hours per resident 

19 day’); 

20 ‘‘(II) differences in types of staff 

21 (such as training associated with dif22 ferent categories of staff); 

23 ‘‘(III) the relationship between 

24 nurse staffing levels and quality of 

25 care; and 


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1 ‘‘(IV) an explanation that appro2 priate staffing levels vary based on 

3 patient case mix. 

4 ‘‘(ii) Links to State Internet websites 

5 with information regarding State survey 

6 and certification programs, links to Form 

7 2567 State inspection reports (or a suc8 cessor form) on such websites, information 

9 to guide consumers in how to interpret and 

10 understand such reports, and the facility 

11 plan of correction or other response to 

12 such report. Any such links shall be posted 

13 on a timely basis. 

14 ‘‘(iii) The standardized complaint 

15 form developed under section 1128I(f), in16 cluding explanatory material on what com17 plaint forms are, how they are used, and 

18 how to file a complaint with the State sur19 vey and certification program and the 

20 State long-term care ombudsman program. 

21 ‘‘(iv) Summary information on the 

22 number, type, severity, and outcome of 

23 substantiated complaints. 


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1 ‘‘(v) The number of adjudicated in2 stances of criminal violations by a facility 

3 or the employees of a facility— 

4 ‘‘(I) that were committed inside 

5 of the facility; and 

6 ‘‘(II) with respect to such in7 stances of violations or crimes com8 mitted outside of the facility, that 

9 were violations or crimes that resulted 

10 in the serious bodily injury of an 

11 elder. 

12 ‘‘(B) DEADLINE FOR PROVISION OF INFOR13 MATION.— 

14 ‘‘(i) IN GENERAL.—Except as pro15 vided in clause (ii), the Secretary shall en16 sure that the information described in sub17 paragraph (A) is included on such website 

18 (or a successor website) not later than 1 

19 year after the date of the enactment of this 

20 subsection. 

21 ‘‘(ii) EXCEPTION.—The Secretary 

22 shall ensure that the information described 

23 in subparagraph (A)(i) is included on such 

24 website (or a successor website) not later 


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1 than the date on which the requirements 

2 under section 1128I(g) are implemented. 

3 ‘‘(2) REVIEW AND MODIFICATION OF

4 WEBSITE.— 

5 ‘‘(A) IN GENERAL.—The Secretary shall 

6 establish a process— 

7 ‘‘(i) to review the accuracy, clarity of 

8 presentation, timeliness, and comprehen9 siveness of information reported on such 

10 website as of the day before the date of the 

11 enactment of this subsection; and 

12 ‘‘(ii) not later than 1 year after the 

13 date of the enactment of this subsection, to 

14 modify or revamp such website in accord15 ance with the review conducted under 

16 clause (i). 

17 ‘‘(B) CONSULTATION.—In conducting the 

18 review under subparagraph (A)(i), the Sec19 retary shall consult with— 

20 ‘‘(i) State long-term care ombudsman 

21 programs; 

22 ‘‘(ii) consumer advocacy groups; 

23 ‘‘(iii) provider stakeholder groups; 

24 ‘‘(iv) skilled nursing facility employees 

25 and their representatives; and 


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1 ‘‘(v) any other representatives of pro2 grams or groups the Secretary determines 

3 appropriate.’’. 

4 (2) TIMELINESS OF SUBMISSION OF SURVEY

5 AND CERTIFICATION INFORMATION.— 

6 (A) IN GENERAL.—Section 1919(g)(5) of 

7 the Social Security Act (42 U.S.C. 1396r(g)(5)) 

8 is amended by adding at the end the following 

9 new subparagraph: 

10 ‘‘(E) SUBMISSION OF SURVEY AND CER11 TIFICATION INFORMATION TO THE SEC12 RETARY.—In order to improve the timeliness of 

13 information made available to the public under 

14 subparagraph (A) and provided on the Nursing 

15 Home Compare Medicare website under sub16 section (i), each State shall submit information 

17 respecting any survey or certification made re18 specting a nursing facility (including any en19 forcement actions taken by the State) to the 

20 Secretary not later than the date on which the 

21 State sends such information to the facility. 

22 The Secretary shall use the information sub23 mitted under the preceding sentence to update 

24 the information provided on the Nursing Home 

25 Compare Medicare website as expeditiously as 


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1 practicable but not less frequently than quar2 terly.’’. 

3 (B) EFFECTIVE DATE.—The amendment 

4 made by this paragraph shall take effect 1 year 

5 after the date of the enactment of this Act. 

6 (3) SPECIAL FOCUS FACILITY PROGRAM.—Sec7 tion 1919(f) of the Social Security Act (42 U.S.C. 

8 1396r(f)) is amended by adding at the end of the 

9 following new paragraph: 

10 ‘‘(10) SPECIAL FOCUS FACILITY PROGRAM.— 

11 ‘‘(A) IN GENERAL.—The Secretary shall 

12 conduct a special focus facility program for en13 forcement of requirements for nursing facilities 

14 that the Secretary has identified as having sub15 stantially failed to meet applicable requirements 

16 of this Act. 

17 ‘‘(B) PERIODIC SURVEYS.—Under such 

18 program the Secretary shall conduct surveys of 

19 each facility in the program not less often than 

20 once every 6 months.’’. 

21 (c) AVAILABILITY OF REPORTS ON SURVEYS, CER22 TIFICATIONS, AND COMPLAINT INVESTIGATIONS.— 

23 (1) SKILLED NURSING FACILITIES.—Section 

24 1819(d)(1) of the Social Security Act (42 U.S.C. 

25 1395i–3(d)(1)), as amended by section 6101, is 


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1 amended by adding at the end the following new 

2 subparagraph: 

3 ‘‘(C) AVAILABILITY OF SURVEY, CERTIFI4 CATION, AND COMPLAINT INVESTIGATION RE5 PORTS.—A skilled nursing facility must— 

6 ‘‘(i) have reports with respect to any 

7 surveys, certifications, and complaint in8 vestigations made respecting the facility 

9 during the 3 preceding years available for 

10 any individual to review upon request; and 

11 ‘‘(ii) post notice of the availability of 

12 such reports in areas of the facility that 

13 are prominent and accessible to the public. 

14 The facility shall not make available under 

15 clause (i) identifying information about com16 plainants or residents.’’. 

17 (2) NURSING FACILITIES.—Section 1919(d)(1) 

18 of the Social Security Act (42 U.S.C. 1396r(d)(1)), 

19 as amended by section 6101, is amended by adding 

20 at the end the following new subparagraph: 

21 ‘‘(V) AVAILABILITY OF SURVEY, CERTIFI22 CATION, AND COMPLAINT INVESTIGATION RE23 PORTS.—A nursing facility must— 

24 ‘‘(i) have reports with respect to any 

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1 vestigations made respecting the facility 

2 during the 3 preceding years available for 

3 any individual to review upon request; and 

4 ‘‘(ii) post notice of the availability of 

5 such reports in areas of the facility that 

6 are prominent and accessible to the public. 

7 The facility shall not make available under 

8 clause (i) identifying information about com9 plainants or residents.’’. 

10 (3) EFFECTIVE DATE.—The amendments made 

11 by this subsection shall take effect 1 year after the 

12 date of the enactment of this Act. 

13 (d) GUIDANCE TO STATES ON FORM 2567 STATE IN14 SPECTION REPORTS AND COMPLAINT INVESTIGATION RE15 PORTS.— 

16 (1) GUIDANCE.—The Secretary of Health and 

17 Human Services (in this subtitle referred to as the 

18 ‘‘Secretary’’) shall provide guidance to States on 

19 how States can establish electronic links to Form 

20 2567 State inspection reports (or a successor form), 

21 complaint investigation reports, and a facility’s plan 

22 of correction or other response to such Form 2567 

23 State inspection reports (or a successor form) on the 

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1 ties and the Secretary shall, if possible, include such 

2 information on Nursing Home Compare. 

3 (2) REQUIREMENT.—Section 1902(a)(9) of the 

4 Social Security Act (42 U.S.C. 1396a(a)(9)) is 

5 amended— 

6 (A) by striking ‘‘and’’ at the end of sub7 paragraph (B); 

8 (B) by striking the semicolon at the end of 

9 subparagraph (C) and inserting ‘‘, and’’; and 

10 (C) by adding at the end the following new 

11 subparagraph: 

12 ‘‘(D) that the State maintain a consumer13 oriented website providing useful information to 

14 consumers regarding all skilled nursing facili15 ties and all nursing facilities in the State, in16 cluding for each facility, Form 2567 State in17 spection reports (or a successor form), com18 plaint investigation reports, the facility’s plan of 

19 correction, and such other information that the 

20 State or the Secretary considers useful in as21 sisting the public to assess the quality of long 

22 term care options and the quality of care pro23 vided by individual facilities;’’. 

24 (3) DEFINITIONS.—In this subsection: 


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1 (A) NURSING FACILITY.—The term ‘‘nurs2 ing facility’’ has the meaning given such term 

3 in section 1919(a) of the Social Security Act 

4 (42 U.S.C. 1396r(a)). 

5 (B) SECRETARY.—The term ‘‘Secretary’’ 

6 means the Secretary of Health and Human 

7 Services. 

8 (C) SKILLED NURSING FACILITY.—The 

9 term ‘‘skilled nursing facility’’ has the meaning 

10 given such term in section 1819(a) of the Social 

11 Security Act (42 U.S.C. 1395i–3(a)). 

12 (e) DEVELOPMENT OF CONSUMER RIGHTS INFORMA13 TION PAGE ON NURSING HOME COMPARE WEBSITE.— 

14 Not later than 1 year after the date of enactment of this 

15 Act, the Secretary shall ensure that the Department of 

16 Health and Human Services, as part of the information 

17 provided for comparison of nursing facilities on the Nurs18 ing Home Compare Medicare website develops and in19 cludes a consumer rights information page that contains 

20 links to descriptions of, and information with respect to, 

21 the following: 

22 (1) The documentation on nursing facilities 

23 that is available to the public. 


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1 (2) General information and tips on choosing a 

2 nursing facility that meets the needs of the indi3 vidual. 

4 (3) General information on consumer rights 

5 with respect to nursing facilities. 

6 (4) The nursing facility survey process (on a 

7 national and State-specific basis). 

8 (5) On a State-specific basis, the services avail9 able through the State long-term care ombudsman 

10 for such State. 

11 SEC. 6104. REPORTING OF EXPENDITURES. 

12 Section 1888 of the Social Security Act (42 U.S.C. 

13 1395yy) is amended by adding at the end the following 

14 new subsection: 

15 ‘‘(f) REPORTING OF DIRECT CARE EXPENDI16 TURES.— 

17 ‘‘(1) IN GENERAL.—For cost reports submitted 

18 under this title for cost reporting periods beginning 

19 on or after the date that is 2 years after the date 

20 of the enactment of this subsection, skilled nursing 

21 facilities shall separately report expenditures for 

22 wages and benefits for direct care staff (breaking 

23 out (at a minimum) registered nurses, licensed pro24 fessional nurses, certified nurse assistants, and other 

25 medical and therapy staff). 


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1 ‘‘(2) MODIFICATION OF FORM.—The Secretary, 

2 in consultation with private sector accountants expe3 rienced with Medicare and Medicaid nursing facility 

4 home cost reports, shall redesign such reports to 

5 meet the requirement of paragraph (1) not later 

6 than 1 year after the date of the enactment of this 

7 subsection. 

8 ‘‘(3) CATEGORIZATION BY FUNCTIONAL AC9 COUNTS.—Not later than 30 months after the date 

10 of the enactment of this subsection, the Secretary, 

11 working in consultation with the Medicare Payment 

12 Advisory Commission, the Medicaid and CHIP Pay13 ment and Access Commission, the Inspector General 

14 of the Department of Health and Human Services, 

15 and other expert parties the Secretary determines 

16 appropriate, shall take the expenditures listed on 

17 cost reports, as modified under paragraph (1), sub18 mitted by skilled nursing facilities and categorize 

19 such expenditures, regardless of any source of pay20 ment for such expenditures, for each skilled nursing 

21 facility into the following functional accounts on an 

22 annual basis: 

23 ‘‘(A) Spending on direct care services (in24 cluding nursing, therapy, and medical services). 


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1 ‘‘(B) Spending on indirect care (including 

2 housekeeping and dietary services). 

3 ‘‘(C) Capital assets (including building and 

4 land costs). 

5 ‘‘(D) Administrative services costs. 

6 ‘‘(4) AVAILABILITY OF INFORMATION SUB7 MITTED.—The Secretary shall establish procedures 

8 to make information on expenditures submitted 

9 under this subsection readily available to interested 

10 parties upon request, subject to such requirements 

11 as the Secretary may specify under the procedures 

12 established under this paragraph.’’. 

13 SEC. 6105. STANDARDIZED COMPLAINT FORM. 

14 (a) IN GENERAL.—Section 1128I of the Social Secu15 rity Act, as added and amended by this Act, is amended 

16 by adding at the end the following new subsection: 

17 ‘‘(f) STANDARDIZED COMPLAINT FORM.— 

18 ‘‘(1) DEVELOPMENT BY THE SECRETARY.—The 

19 Secretary shall develop a standardized complaint 

20 form for use by a resident (or a person acting on the 

21 resident’s behalf) in filing a complaint with a State 

22 survey and certification agency and a State long23 term care ombudsman program with respect to a fa24 cility. 


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1 ‘‘(2) COMPLAINT FORMS AND RESOLUTION

2 PROCESSES.— 

3 ‘‘(A) COMPLAINT FORMS.—The State must 

4 make the standardized complaint form devel5 oped under paragraph (1) available upon re6 quest to— 

7 ‘‘(i) a resident of a facility; and 

8 ‘‘(ii) any person acting on the resi9 dent’s behalf. 

10 ‘‘(B) COMPLAINT RESOLUTION PROCESS.— 

11 The State must establish a complaint resolution 

12 process in order to ensure that the legal rep13 resentative of a resident of a facility or other 

14 responsible party is not denied access to such 

15 resident or otherwise retaliated against if they 

16 have complained about the quality of care pro17 vided by the facility or other issues relating to 

18 the facility. Such complaint resolution process 

19 shall include— 

20 ‘‘(i) procedures to assure accurate 

21 tracking of complaints received, including 

22 notification to the complainant that a com23 plaint has been received; 


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1 ‘‘(ii) procedures to determine the like2 ly severity of a complaint and for the in3 vestigation of the complaint; and 

4 ‘‘(iii) deadlines for responding to a 

5 complaint and for notifying the complain6 ant of the outcome of the investigation. 

7 ‘‘(3) RULE OF CONSTRUCTION.—Nothing in 

8 this subsection shall be construed as preventing a 

9 resident of a facility (or a person acting on the resi10 dent’s behalf) from submitting a complaint in a 

11 manner or format other than by using the standard12 ized complaint form developed under paragraph (1) 

13 (including submitting a complaint orally).’’. 

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

15 this section shall take effect 1 year after the date of the 

16 enactment of this Act. 

17 SEC. 6106. ENSURING STAFFING ACCOUNTABILITY. 

18 Section 1128I of the Social Security Act, as added 

19 and amended by this Act, is amended by adding at the 

20 end the following new subsection: 

21 ‘‘(g) SUBMISSION OF STAFFING INFORMATION

22 BASED ON PAYROLL DATA IN A UNIFORM FORMAT.—Be23 ginning not later than 2 years after the date of the enact24 ment of this subsection, and after consulting with State 

25 long-term care ombudsman programs, consumer advocacy 


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1 groups, provider stakeholder groups, employees and their 

2 representatives, and other parties the Secretary deems ap3 propriate, the Secretary shall require a facility to elec4 tronically submit to the Secretary direct care staffing in5 formation (including information with respect to agency 

6 and contract staff) based on payroll and other verifiable 

7 and auditable data in a uniform format (according to spec8 ifications established by the Secretary in consultation with 

9 such programs, groups, and parties). Such specifications 

10 shall require that the information submitted under the 

11 preceding sentence— 

12 ‘‘(1) specify the category of work a certified em13 ployee performs (such as whether the employee is a 

14 registered nurse, licensed practical nurse, licensed 

15 vocational nurse, certified nursing assistant, thera16 pist, or other medical personnel); 

17 ‘‘(2) include resident census data and informa18 tion on resident case mix; 

19 ‘‘(3) include a regular reporting schedule; and 

20 ‘‘(4) include information on employee turnover 

21 and tenure and on the hours of care provided by 

22 each category of certified employees referenced in 

23 paragraph (1) per resident per day. 

24 Nothing in this subsection shall be construed as pre25 venting the Secretary from requiring submission of such 


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1 information with respect to specific categories, such as 

2 nursing staff, before other categories of certified employ3 ees. Information under this subsection with respect to 

4 agency and contract staff shall be kept separate from in5 formation on employee staffing.’’. 

6 SEC. 6107. GAO STUDY AND REPORT ON FIVE-STAR QUAL7 ITY RATING SYSTEM. 

8 (a) STUDY.—The Comptroller General of the United 

9 States (in this section referred to as the ‘‘Comptroller 

10 General’’) shall conduct a study on the Five-Star Quality 

11 Rating System for nursing homes of the Centers for Medi12 care & Medicaid Services. Such study shall include an 

13 analysis of— 

14 (1) how such system is being implemented; 

15 (2) any problems associated with such system 

16 or its implementation; and 

17 (3) how such system could be improved. 

18 (b) REPORT.—Not later than 2 years after the date 

19 of enactment of this Act, the Comptroller General shall 

20 submit to Congress a report containing the results of the 

21 study conducted under subsection (a), together with rec22 ommendations for such legislation and administrative ac23 tion as the Comptroller General determines appropriate. 


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1 PART II—TARGETING ENFORCEMENT 

2 SEC. 6111. CIVIL MONEY PENALTIES. 

3 (a) SKILLED NURSING FACILITIES.— 

4 (1) IN GENERAL.—Section 1819(h)(2)(B)(ii) of 

5 the Social Security Act (42 U.S.C. 1395i– 

6 3(h)(2)(B)(ii)) is amended— 

7 (A) by striking ‘‘PENALTIES.—The Sec8 retary’’ and inserting ‘‘PENALTIES.— 

9 ‘‘(I) IN GENERAL.—Subject to 

10 subclause (II), the Secretary’’; and 

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

12 subclauses: 

13 ‘‘(II) REDUCTION OF CIVIL

14 MONEY PENALTIES IN CERTAIN CIR15 CUMSTANCES.—Subject to subclause 

16 (III), in the case where a facility self17 reports and promptly corrects a defi18 ciency for which a penalty was im19 posed under this clause not later than 

20 10 calendar days after the date of 

21 such imposition, the Secretary may 

22 reduce the amount of the penalty im23 posed by not more than 50 percent. 

24 ‘‘(III) PROHIBITIONS ON REDUC25 TION FOR CERTAIN DEFICIENCIES.— 


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1 ‘‘(aa) REPEAT DEFI2 CIENCIES.—The Secretary may 

3 not reduce the amount of a pen4 alty under subclause (II) if the 

5 Secretary had reduced a penalty 

6 imposed on the facility in the 

7 preceding year under such sub8 clause with respect to a repeat 

9 deficiency. 

10 ‘‘(bb) CERTAIN OTHER DE11 FICIENCIES.—The Secretary may 

12 not reduce the amount of a pen13 alty under subclause (II) if the 

14 penalty is imposed on the facility 

15 for a deficiency that is found to 

16 result in a pattern of harm or 

17 widespread harm, immediately 

18 jeopardizes the health or safety 

19 of a resident or residents of the 

20 facility, or results in the death of 

21 a resident of the facility. 

22 ‘‘(IV) COLLECTION OF CIVIL

23 MONEY PENALTIES.—In the case of a 

24 civil money penalty imposed under 


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1 this clause, the Secretary shall issue 

2 regulations that— 

3 ‘‘(aa) subject to item (cc), 

4 not later than 30 days after the 

5 imposition of the penalty, provide 

6 for the facility to have the oppor7 tunity to participate in an inde8 pendent informal dispute resolu9 tion process which generates a 

10 written record prior to the collec11 tion of such penalty; 

12 ‘‘(bb) in the case where the 

13 penalty is imposed for each day 

14 of noncompliance, provide that a 

15 penalty may not be imposed for 

16 any day during the period begin17 ning on the initial day of the im18 position of the penalty and end19 ing on the day on which the in20 formal dispute resolution process 

21 under item (aa) is completed; 

22 ‘‘(cc) may provide for the 

23 collection of such civil money 

24 penalty and the placement of 

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1 crow account under the direction 

2 of the Secretary on the earlier of 

3 the date on which the informal 

4 dispute resolution process under 

5 item (aa) is completed or the 

6 date that is 90 days after the 

7 date of the imposition of the pen8 alty; 

9 ‘‘(dd) may provide that such 

10 amounts collected are kept in 

11 such account pending the resolu12 tion of any subsequent appeals; 

13 ‘‘(ee) in the case where the 

14 facility successfully appeals the 

15 penalty, may provide for the re16 turn of such amounts collected 

17 (plus interest) to the facility; and 

18 ‘‘(ff) in the case where all 

19 such appeals are unsuccessful, 

20 may provide that some portion of 

21 such amounts collected may be 

22 used to support activities that 

23 benefit residents, including as24 sistance to support and protect 

25 residents of a facility that closes 


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1 (voluntarily or involuntarily) or is 

2 decertified (including offsetting 

3 costs of relocating residents to 

4 home and community-based set5 tings or another facility), projects 

6 that support resident and family 

7 councils and other consumer in8 volvement in assuring quality 

9 care in facilities, and facility im10 provement initiatives approved by 

11 the Secretary (including joint 

12 training of facility staff and sur13 veyors, technical assistance for 

14 facilities implementing quality as15 surance programs, the appoint16 ment of temporary management 

17 firms, and other activities ap18 proved by the Secretary).’’. 

19 (2) CONFORMING AMENDMENT.—The second 

20 sentence of section 1819(h)(5) of the Social Security 

21 Act (42 U.S.C. 1395i–3(h)(5)) is amended by insert22 ing ‘‘(ii)(IV),’’ after ‘‘(i),’’. 

23 (b) NURSING FACILITIES.— 


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1 (1) IN GENERAL.—Section 1919(h)(3)(C)(ii) of 

2 the Social Security Act (42 U.S.C. 1396r(h)(3)(C)) 

3 is amended— 

4 (A) by striking ‘‘PENALTIES.—The Sec5 retary’’ and inserting ‘‘PENALTIES.— 

6 ‘‘(I) IN GENERAL.—Subject to 

7 subclause (II), the Secretary’’; and 

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

9 subclauses: 

10 ‘‘(II) REDUCTION OF CIVIL

11 MONEY PENALTIES IN CERTAIN CIR12 CUMSTANCES.—Subject to subclause 

13 (III), in the case where a facility self14 reports and promptly corrects a defi15 ciency for which a penalty was im16 posed under this clause not later than 

17 10 calendar days after the date of 

18 such imposition, the Secretary may 

19 reduce the amount of the penalty im20 posed by not more than 50 percent. 

21 ‘‘(III) PROHIBITIONS ON REDUC22 TION FOR CERTAIN DEFICIENCIES.— 

23 ‘‘(aa) REPEAT DEFI24 CIENCIES.—The Secretary may 

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1 alty under subclause (II) if the 

2 Secretary had reduced a penalty 

3 imposed on the facility in the 

4 preceding year under such sub5 clause with respect to a repeat 

6 deficiency. 

7 ‘‘(bb) CERTAIN OTHER DE8 FICIENCIES.—The Secretary may 

9 not reduce the amount of a pen10 alty under subclause (II) if the 

11 penalty is imposed on the facility 

12 for a deficiency that is found to 

13 result in a pattern of harm or 

14 widespread harm, immediately 

15 jeopardizes the health or safety 

16 of a resident or residents of the 

17 facility, or results in the death of 

18 a resident of the facility. 

19 ‘‘(IV) COLLECTION OF CIVIL

20 MONEY PENALTIES.—In the case of a 

21 civil money penalty imposed under 

22 this clause, the Secretary shall issue 

23 regulations that— 

24 ‘‘(aa) subject to item (cc), 

25 not later than 30 days after the 


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1 imposition of the penalty, provide 

2 for the facility to have the oppor3 tunity to participate in an inde4 pendent informal dispute resolu5 tion process which generates a 

6 written record prior to the collec7 tion of such penalty; 

8 ‘‘(bb) in the case where the 

9 penalty is imposed for each day 

10 of noncompliance, provide that a 

11 penalty may not be imposed for 

12 any day during the period begin13 ning on the initial day of the im14 position of the penalty and end15 ing on the day on which the in16 formal dispute resolution process 

17 under item (aa) is completed; 

18 ‘‘(cc) may provide for the 

19 collection of such civil money 

20 penalty and the placement of 

21 such amounts collected in an es22 crow account under the direction 

23 of the Secretary on the earlier of 

24 the date on which the informal 

25 dispute resolution process under 


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1 item (aa) is completed or the 

2 date that is 90 days after the 

3 date of the imposition of the pen4 alty; 

5 ‘‘(dd) may provide that such 

6 amounts collected are kept in 

7 such account pending the resolu8 tion of any subsequent appeals; 

9 ‘‘(ee) in the case where the 

10 facility successfully appeals the 

11 penalty, may provide for the re12 turn of such amounts collected 

13 (plus interest) to the facility; and 

14 ‘‘(ff) in the case where all 

15 such appeals are unsuccessful, 

16 may provide that some portion of 

17 such amounts collected may be 

18 used to support activities that 

19 benefit residents, including as20 sistance to support and protect 

21 residents of a facility that closes 

22 (voluntarily or involuntarily) or is 

23 decertified (including offsetting 

24 costs of relocating residents to 

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1 tings or another facility), projects 

2 that support resident and family 

3 councils and other consumer in4 volvement in assuring quality 

5 care in facilities, and facility im6 provement initiatives approved by 

7 the Secretary (including joint 

8 training of facility staff and sur9 veyors, technical assistance for 

10 facilities implementing quality as11 surance programs, the appoint12 ment of temporary management 

13 firms, and other activities ap14 proved by the Secretary).’’. 

15 (2) CONFORMING AMENDMENT.—Section 

16 1919(h)(5)(8) of the Social Security Act (42 U.S.C. 

17 1396r(h)(5)(8)) is amended by inserting ‘‘(ii)(IV),’’ 

18 after ‘‘(i),’’. 

19 (c) EFFECTIVE DATE.—The amendments made by 

20 this section shall take effect 1 year after the date of the 

21 enactment of this Act. 

22 SEC. 6112. NATIONAL INDEPENDENT MONITOR DEM23 ONSTRATION PROJECT. 

24 (a) ESTABLISHMENT.— 


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1 (1) IN GENERAL.—The Secretary, in consulta2 tion with the Inspector General of the Department 

3 of Health and Human Services, shall conduct a dem4 onstration project to develop, test, and implement an 

5 independent monitor program to oversee interstate 

6 and large intrastate chains of skilled nursing facili7 ties and nursing facilities. 

8 (2) SELECTION.—The Secretary shall select 

9 chains of skilled nursing facilities and nursing facili10 ties described in paragraph (1) to participate in the 

11 demonstration project under this section from 

12 among those chains that submit an application to 

13 the Secretary at such time, in such manner, and 

14 containing such information as the Secretary may 

15 require. 

16 (3) DURATION.—The Secretary shall conduct 

17 the demonstration project under this section for a 2- 

18 year period. 

19 (4) IMPLEMENTATION.—The Secretary shall 

20 implement the demonstration project under this sec21 tion not later than 1 year after the date of the en22 actment of this Act. 

23 (b) REQUIREMENTS.—The Secretary shall evaluate 

24 chains selected to participate in the demonstration project 

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1 retary, including where evidence suggests that a number 

2 of the facilities of the chain are experiencing serious safety 

3 and quality of care problems. Such criteria may include 

4 the evaluation of a chain that includes a number of facili5 ties participating in the ‘‘Special Focus Facility’’ program 

6 (or a successor program) or multiple facilities with a 

7 record of repeated serious safety and quality of care defi8 ciencies. 

9 (c) RESPONSIBILITIES.—An independent monitor 

10 that enters into a contract with the Secretary to partici11 pate in the conduct of the demonstration project under 

12 this section shall— 

13 (1) conduct periodic reviews and prepare root14 cause quality and deficiency analyses of a chain to 

15 assess if facilities of the chain are in compliance 

16 with State and Federal laws and regulations applica17 ble to the facilities; 

18 (2) conduct sustained oversight of the efforts of 

19 the chain, whether publicly or privately held, to 

20 achieve compliance by facilities of the chain with 

21 State and Federal laws and regulations applicable to 

22 the facilities; 

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1 cilities of the chain in relation to resident census, 

2 staff turnover rates, and tenure; 

3 (4) report findings and recommendations with 

4 respect to such reviews, analyses, and oversight to 

5 the chain and facilities of the chain, to the Sec6 retary, and to relevant States; and 

7 (5) publish the results of such reviews, anal8 yses, and oversight. 

9 (d) IMPLEMENTATION OF RECOMMENDATIONS.— 

10 (1) RECEIPT OF FINDING BY CHAIN.—Not later 

11 than 10 days after receipt of a finding of an inde12 pendent monitor under subsection (c)(4), a chain 

13 participating in the demonstration project shall sub14 mit to the independent monitor a report— 

15 (A) outlining corrective actions the chain 

16 will take to implement the recommendations in 

17 such report; or 

18 (B) indicating that the chain will not im19 plement such recommendations, and why it will 

20 not do so. 

21 (2) RECEIPT OF REPORT BY INDEPENDENT

22 MONITOR.—Not later than 10 days after receipt of 

23 a report submitted by a chain under paragraph (1), 

24 an independent monitor shall finalize its rec25 ommendations and submit a report to the chain and 


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1 facilities of the chain, the Secretary, and the State 

2 or States, as appropriate, containing such final rec3 ommendations. 

4 (e) COST OF APPOINTMENT.—A chain shall be re5 sponsible for a portion of the costs associated with the 

6 appointment of independent monitors under the dem7 onstration project under this section. The chain shall pay 

8 such portion to the Secretary (in an amount and in ac9 cordance with procedures established by the Secretary). 

10 (f) WAIVER AUTHORITY.—The Secretary may waive 

11 such requirements of titles XVIII and XIX of the Social 

12 Security Act (42 U.S.C. 1395 et seq.; 1396 et seq.) as 

13 may be necessary for the purpose of carrying out the dem14 onstration project under this section. 

15 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

16 are authorized to be appropriated such sums as may be 

17 necessary to carry out this section. 

18 (h) DEFINITIONS.—In this section: 

19 (1) ADDITIONAL DISCLOSABLE PARTY.—The 

20 term ‘‘additional disclosable party’’ has the meaning 

21 given such term in section 1124(c)(5)(A) of the So22 cial Security Act, as added by section 4201(a). 

23 (2) FACILITY.—The term ‘‘facility’’ means a 

24 skilled nursing facility or a nursing facility. 


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1 (3) NURSING FACILITY.—The term ‘‘nursing 

2 facility’’ has the meaning given such term in section 

3 1919(a) of the Social Security Act (42 U.S.C. 

4 1396r(a)). 

5 (4) SECRETARY.—The term ‘‘Secretary’’ means 

6 the Secretary of Health and Human Services, acting 

7 through the Assistant Secretary for Planning and 

8 Evaluation. 

9 (5) SKILLED NURSING FACILITY.—The term 

10 ‘‘skilled nursing facility’’ has the meaning given such 

11 term in section 1819(a) of the Social Security Act 

12 (42 U.S.C. 1395(a)). 

13 (i) EVALUATION AND REPORT.— 

14 (1) EVALUATION.—The Secretary, in consulta15 tion with the Inspector General of the Department 

16 of Health and Human Services, shall evaluate the 

17 demonstration project conducted under this section. 

18 (2) REPORT.—Not later than 180 days after 

19 the completion of the demonstration project under 

20 this section, the Secretary shall submit to Congress 

21 a report containing the results of the evaluation con22 ducted under paragraph (1), together with rec23 ommendations— 


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1 (A) as to whether the independent monitor 

2 program should be established on a permanent 

3 basis; 

4 (B) if the Secretary recommends that such 

5 program be so established, on appropriate pro6 cedures and mechanisms for such establish7 ment; and 

8 (C) for such legislation and administrative 

9 action as the Secretary determines appropriate. 

10 SEC. 6113. NOTIFICATION OF FACILITY CLOSURE. 

11 (a) IN GENERAL.—Section 1128I of the Social Secu12 rity Act, as added and amended by this Act, is amended 

13 by adding at the end the following new subsection: 

14 ‘‘(h) NOTIFICATION OF FACILITY CLOSURE.— 

15 ‘‘(1) IN GENERAL.—Any individual who is the 

16 administrator of a facility must— 

17 ‘‘(A) submit to the Secretary, the State 

18 long-term care ombudsman, residents of the fa19 cility, and the legal representatives of such resi20 dents or other responsible parties, written noti21 fication of an impending closure— 

22 ‘‘(i) subject to clause (ii), not later 

23 than the date that is 60 days prior to the 

24 date of such closure; and 


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1 ‘‘(ii) in the case of a facility where the 

2 Secretary terminates the facility’s partici3 pation under this title, not later than the 

4 date that the Secretary determines appro5 priate; 

6 ‘‘(B) ensure that the facility does not 

7 admit any new residents on or after the date on 

8 which such written notification is submitted; 

9 and 

10 ‘‘(C) include in the notice a plan for the 

11 transfer and adequate relocation of the resi12 dents of the facility by a specified date prior to 

13 closure that has been approved by the State, in14 cluding assurances that the residents will be 

15 transferred to the most appropriate facility or 

16 other setting in terms of quality, services, and 

17 location, taking into consideration the needs, 

18 choice, and best interests of each resident. 

19 ‘‘(2) RELOCATION.— 

20 ‘‘(A) IN GENERAL.—The State shall ensure 

21 that, before a facility closes, all residents of the 

22 facility have been successfully relocated to an23 other facility or an alternative home and com24 munity-based setting. 


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1 ‘‘(B) CONTINUATION OF PAYMENTS UNTIL

2 RESIDENTS RELOCATED.—The Secretary may, 

3 as the Secretary determines appropriate, con4 tinue to make payments under this title with re5 spect to residents of a facility that has sub6 mitted a notification under paragraph (1) dur7 ing the period beginning on the date such noti8 fication is submitted and ending on the date on 

9 which the resident is successfully relocated. 

10 ‘‘(3) SANCTIONS.—Any individual who is the 

11 administrator of a facility that fails to comply with 

12 the requirements of paragraph (1)— 

13 ‘‘(A) shall be subject to a civil monetary 

14 penalty of up to $100,000; 

15 ‘‘(B) may be subject to exclusion from par16 ticipation in any Federal health care program 

17 (as defined in section 1128B(f)); and 

18 ‘‘(C) shall be subject to any other penalties 

19 that may be prescribed by law. 

20 ‘‘(4) PROCEDURE.—The provisions of section 

21 1128A (other than subsections (a) and (b) and the 

22 second sentence of subsection (f)) shall apply to a 

23 civil money penalty or exclusion under paragraph (3) 

24 in the same manner as such provisions apply to a 

25 penalty or proceeding under section 1128A(a).’’. 


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1 (b) CONFORMING AMENDMENTS.—Section 

2 1819(h)(4) of the Social Security Act (42 U.S.C. 1395i– 

3 3(h)(4)) is amended— 

4 (1) in the first sentence, by striking ‘‘the Sec5 retary shall terminate’’ and inserting ‘‘the Secretary, 

6 subject to section 1128I(h), shall terminate’’; and 

7 (2) in the second sentence, by striking ‘‘sub8 section (c)(2)’’ and inserting ‘‘subsection (c)(2) and 

9 section 1128I(h)’’. 

10 (c) EFFECTIVE DATE.—The amendments made by 

11 this section shall take effect 1 year after the date of the 

12 enactment of this Act. 

13 SEC. 6114. NATIONAL DEMONSTRATION PROJECTS ON CUL14 TURE CHANGE AND USE OF INFORMATION 

15 TECHNOLOGY IN NURSING HOMES. 

16 (a) IN GENERAL.—The Secretary shall conduct 2 

17 demonstration projects, 1 for the development of best 

18 practices in skilled nursing facilities and nursing facilities 

19 that are involved in the culture change movement (includ20 ing the development of resources for facilities to find and 

21 access funding in order to undertake culture change) and 

22 1 for the development of best practices in skilled nursing 

23 facilities and nursing facilities for the use of information 

24 technology to improve resident care. 

25 (b) CONDUCT OF DEMONSTRATION PROJECTS.— 


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1 (1) GRANT AWARD.—Under each demonstration 

2 project conducted under this section, the Secretary 

3 shall award 1 or more grants to facility-based set4 tings for the development of best practices described 

5 in subsection (a) with respect to the demonstration 

6 project involved. Such award shall be made on a 

7 competitive basis and may be allocated in 1 lump8 sum payment. 

9 (2) CONSIDERATION OF SPECIAL NEEDS OF

10 RESIDENTS.—Each demonstration project conducted 

11 under this section shall take into consideration the 

12 special needs of residents of skilled nursing facilities 

13 and nursing facilities who have cognitive impair14 ment, including dementia. 

15 (c) DURATION AND IMPLEMENTATION.— 

16 (1) DURATION.—The demonstration projects 

17 shall each be conducted for a period not to exceed 

18 3 years. 

19 (2) IMPLEMENTATION.—The demonstration 

20 projects shall each be implemented not later than 1 

21 year after the date of the enactment of this Act. 

22 (d) DEFINITIONS.—In this section: 

23 (1) NURSING FACILITY.—The term ‘‘nursing 

24 facility’’ has the meaning given such term in section 


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1 1919(a) of the Social Security Act (42 U.S.C. 

2 1396r(a)). 

3 (2) SECRETARY.—The term ‘‘Secretary’’ means 

4 the Secretary of Health and Human Services. 

5 (3) SKILLED NURSING FACILITY.—The term 

6 ‘‘skilled nursing facility’’ has the meaning given such 

7 term in section 1819(a) of the Social Security Act 

8 (42 U.S.C. 1395(a)). 

9 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

10 are authorized to be appropriated such sums as may be 

11 necessary to carry out this section. 

12 (f) REPORT.—Not later than 9 months after the com13 pletion of the demonstration project, the Secretary shall 

14 submit to Congress a report on such project, together with 

15 recommendations for such legislation and administrative 

16 action as the Secretary determines appropriate. 

17 PART III—IMPROVING STAFF TRAINING 

18 SEC. 6121. DEMENTIA AND ABUSE PREVENTION TRAINING. 

19 (a) SKILLED NURSING FACILITIES.— 

20 (1) IN GENERAL.—Section 1819(f)(2)(A)(i)(I) 

21 of the Social Security Act (42 U.S.C. 1395i– 

22 3(f)(2)(A)(i)(I)) is amended by inserting ‘‘(includ23 ing, in the case of initial training and, if the Sec24 retary determines appropriate, in the case of ongoVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01630 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ing training, dementia management training, and 

2 patient abuse prevention training’’ before ‘‘, (II)’’. 

3 (2) CLARIFICATION OF DEFINITION OF NURSE

4 AIDE.—Section 1819(b)(5)(F) of the Social Security 

5 Act (42 U.S.C. 1395i–3(b)(5)(F)) is amended by 

6 adding at the end the following flush sentence: 

7 ‘‘Such term includes an individual who provides 

8 such services through an agency or under a 

9 contract with the facility.’’. 

10 (b) NURSING FACILITIES.— 

11 (1) IN GENERAL.—Section 1919(f)(2)(A)(i)(I) 

12 of the Social Security Act (42 U.S.C. 

13 1396r(f)(2)(A)(i)(I)) is amended by inserting ‘‘(in14 cluding, in the case of initial training and, if the 

15 Secretary determines appropriate, in the case of on16 going training, dementia management training, and 

17 patient abuse prevention training’’ before ‘‘, (II)’’. 

18 (2) CLARIFICATION OF DEFINITION OF NURSE

19 AIDE.—Section 1919(b)(5)(F) of the Social Security 

20 Act (42 U.S.C. 1396r(b)(5)(F)) is amended by add21 ing at the end the following flush sentence: 

22 ‘‘Such term includes an individual who provides 

23 such services through an agency or under a 

24 contract with the facility.’’. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect 1 year after the date of the 

3 enactment of this Act. 

4 Subtitle C—Nationwide Program 

5 for National and State Back6 ground Checks on Direct Pa7 tient Access Employees of Long8 term Care Facilities and Pro9 viders 

10 SEC. 6201. NATIONWIDE PROGRAM FOR NATIONAL AND 

11 STATE BACKGROUND CHECKS ON DIRECT PA12 TIENT ACCESS EMPLOYEES OF LONG-TERM 

13 CARE FACILITIES AND PROVIDERS. 

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

15 Human Services (in this section referred to as the ‘‘Sec16 retary’’), shall establish a program to identify efficient, ef17 fective, and economical procedures for long term care fa18 cilities or providers to conduct background checks on pro19 spective direct patient access employees on a nationwide 

20 basis (in this subsection, such program shall be referred 

21 to as the ‘‘nationwide program’’). Except for the following 

22 modifications, the Secretary shall carry out the nationwide 

23 program under similar terms and conditions as the pilot 

24 program under section 307 of the Medicare Prescription 

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1 lic Law 108–173; 117 Stat. 2257), including the prohibi2 tion on hiring abusive workers and the authorization of 

3 the imposition of penalties by a participating State under 

4 subsection (b)(3)(A) and (b)(6), respectively, of such sec5 tion 307: 

6 (1) AGREEMENTS.— 

7 (A) NEWLY PARTICIPATING STATES.—The 

8 Secretary shall enter into agreements with each 

9 State— 

10 (i) that the Secretary has not entered 

11 into an agreement with under subsection 

12 (c)(1) of such section 307; 

13 (ii) that agrees to conduct background 

14 checks under the nationwide program on a 

15 Statewide basis; and 

16 (iii) that submits an application to the 

17 Secretary containing such information and 

18 at such time as the Secretary may specify. 

19 (B) CERTAIN PREVIOUSLY PARTICIPATING

20 STATES.—The Secretary shall enter into agree21 ments with each State— 

22 (i) that the Secretary has entered into 

23 an agreement with under such subsection 

24 (c)(1), but only in the case where such 

25 agreement did not require the State to 


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1 conduct background checks under the pro2 gram established under subsection (a) of 

3 such section 307 on a Statewide basis; 

4 (ii) that agrees to conduct background 

5 checks under the nationwide program on a 

6 Statewide basis; and 

7 (iii) that submits an application to the 

8 Secretary containing such information and 

9 at such time as the Secretary may specify. 

10 (2) NONAPPLICATION OF SELECTION CRI11 TERIA.—The selection criteria required under sub12 section (c)(3)(B) of such section 307 shall not apply. 

13 (3) REQUIRED FINGERPRINT CHECK AS PART

14 OF CRIMINAL HISTORY BACKGROUND CHECK.—The 

15 procedures established under subsection (b)(1) of 

16 such section 307 shall— 

17 (A) require that the long-term care facility 

18 or provider (or the designated agent of the 

19 long-term care facility or provider) obtain State 

20 and national criminal history background 

21 checks on the prospective employee through 

22 such means as the Secretary determines appro23 priate, efficient, and effective that utilize a 

24 search of State-based abuse and neglect reg25 istries and databases, including the abuse and 


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1 neglect registries of another State in the case 

2 where a prospective employee previously resided 

3 in that State, State criminal history records, 

4 the records of any proceedings in the State that 

5 may contain disqualifying information about 

6 prospective employees (such as proceedings con7 ducted by State professional licensing and dis8 ciplinary boards and State Medicaid Fraud 

9 Control Units), and Federal criminal history 

10 records, including a fingerprint check using the 

11 Integrated Automated Fingerprint Identifica12 tion System of the Federal Bureau of Investiga13 tion; 

14 (B) require States to describe and test 

15 methods that reduce duplicative fingerprinting, 

16 including providing for the development of ‘‘rap 

17 back’’ capability by the State such that, if a di18 rect patient access employee of a long-term care 

19 facility or provider is convicted of a crime fol20 lowing the initial criminal history background 

21 check conducted with respect to such employee, 

22 and the employee’s fingerprints match the 

23 prints on file with the State law enforcement 

24 department, the department will immediately 

25 inform the State and the State will immediately 


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1 inform the long-term care facility or provider 

2 which employs the direct patient access em3 ployee of such conviction; and 

4 (C) require that criminal history back5 ground checks conducted under the nationwide 

6 program remain valid for a period of time speci7 fied by the Secretary. 

8 (4) STATE REQUIREMENTS.—An agreement en9 tered into under paragraph (1) shall require that a 

10 participating State— 

11 (A) be responsible for monitoring compli12 ance with the requirements of the nationwide 

13 program; 

14 (B) have procedures in place to— 

15 (i) conduct screening and criminal his16 tory background checks under the nation17 wide program in accordance with the re18 quirements of this section; 

19 (ii) monitor compliance by long-term 

20 care facilities and providers with the proce21 dures and requirements of the nationwide 

22 program; 

23 (iii) as appropriate, provide for a pro24 visional period of employment by a long25 term care facility or provider of a direct 


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1 patient access employee, not to exceed 60 

2 days, pending completion of the required 

3 criminal history background check and, in 

4 the case where the employee has appealed 

5 the results of such background check, 

6 pending completion of the appeals process, 

7 during which the employee shall be subject 

8 to direct on-site supervision (in accordance 

9 with procedures established by the State to 

10 ensure that a long-term care facility or 

11 provider furnishes such direct on-site su12 pervision); 

13 (iv) provide an independent process by 

14 which a provisional employee or an em15 ployee may appeal or dispute the accuracy 

16 of the information obtained in a back17 ground check performed under the nation18 wide program, including the specification 

19 of criteria for appeals for direct patient ac20 cess employees found to have disqualifying 

21 information which shall include consider22 ation of the passage of time, extenuating 

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1 qualifying information with respect to the 

2 current employment of the individual; 

3 (v) provide for the designation of a 

4 single State agency as responsible for— 

5 (I) overseeing the coordination of 

6 any State and national criminal his7 tory background checks requested by 

8 a long-term care facility or provider 

9 (or the designated agent of the long10 term care facility or provider) utilizing 

11 a search of State and Federal crimi12 nal history records, including a finger13 print check of such records; 

14 (II) overseeing the design of ap15 propriate privacy and security safe16 guards for use in the review of the re17 sults of any State or national criminal 

18 history background checks conducted 

19 regarding a prospective direct patient 

20 access employee to determine whether 

21 the employee has any conviction for a 

22 relevant crime; 

23 (III) immediately reporting to 

24 the long-term care facility or provider 

25 that requested the criminal history 


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1 background check the results of such 

2 review; and 

3 (IV) in the case of an employee 

4 with a conviction for a relevant crime 

5 that is subject to reporting under sec6 tion 1128E of the Social Security Act 

7 (42 U.S.C. 1320a–7e), reporting the 

8 existence of such conviction to the 

9 database established under that sec10 tion; 

11 (vi) determine which individuals are 

12 direct patient access employees (as defined 

13 in paragraph (6)(B)) for purposes of the 

14 nationwide program; 

15 (vii) as appropriate, specify offenses, 

16 including convictions for violent crimes, for 

17 purposes of the nationwide program; and 

18 (viii) describe and test methods that 

19 reduce duplicative fingerprinting, including 

20 providing for the development of ‘‘rap 

21 back’’ capability such that, if a direct pa22 tient access employee of a long-term care 

23 facility or provider is convicted of a crime 

24 following the initial criminal history back25 ground check conducted with respect to 


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1 such employee, and the employee’s finger2 prints match the prints on file with the 

3 State law enforcement department— 

4 (I) the department will imme5 diately inform the State agency des6 ignated under clause (v) and such 

7 agency will immediately inform the fa8 cility or provider which employs the 

9 direct patient access employee of such 

10 conviction; and 

11 (II) the State will provide, or will 

12 require the facility to provide, to the 

13 employee a copy of the results of the 

14 criminal history background check 

15 conducted with respect to the em16 ployee at no charge in the case where 

17 the individual requests such a copy. 

18 (5) PAYMENTS.— 

19 (A) NEWLY PARTICIPATING STATES.— 

20 (i) IN GENERAL.—As part of the ap21 plication submitted by a State under para22 graph (1)(A)(iii), the State shall guar23 antee, with respect to the costs to be in24 curred by the State in carrying out the na25 tionwide program, that the State will make 


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1 available (directly or through donations 

2 from public or private entities) a particular 

3 amount of non-Federal contributions, as a 

4 condition of receiving the Federal match 

5 under clause (ii). 

6 (ii) FEDERAL MATCH.—The payment 

7 amount to each State that the Secretary 

8 enters into an agreement with under para9 graph (1)(A) shall be 3 times the amount 

10 that the State guarantees to make avail11 able under clause (i), except that in no 

12 case may the payment amount exceed 

13 $3,000,000. 

14 (B) PREVIOUSLY PARTICIPATING

15 STATES.— 

16 (i) IN GENERAL.—As part of the ap17 plication submitted by a State under para18 graph (1)(B)(iii), the State shall guar19 antee, with respect to the costs to be in20 curred by the State in carrying out the na21 tionwide program, that the State will make 

22 available (directly or through donations 

23 from public or private entities) a particular 

24 amount of non-Federal contributions, as a 


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1 condition of receiving the Federal match 

2 under clause (ii). 

3 (ii) FEDERAL MATCH.—The payment 

4 amount to each State that the Secretary 

5 enters into an agreement with under para6 graph (1)(B) shall be 3 times the amount 

7 that the State guarantees to make avail8 able under clause (i), except that in no 

9 case may the payment amount exceed 

10 $1,500,000. 

11 (6) DEFINITIONS.—Under the nationwide pro12 gram: 

13 (A) CONVICTION FOR A RELEVANT

14 CRIME.—The term ‘‘conviction for a relevant 

15 crime’’ means any Federal or State criminal 

16 conviction for— 

17 (i) any offense described in section 

18 1128(a) of the Social Security Act (42 

19 U.S.C. 1320a–7); or 

20 (ii) such other types of offenses as a 

21 participating State may specify for pur22 poses of conducting the program in such 

23 State. 

24 (B) DISQUALIFYING INFORMATION.—The 

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1 viction for a relevant crime or a finding of pa2 tient or resident abuse. 

3 (C) FINDING OF PATIENT OR RESIDENT

4 ABUSE.—The term ‘‘finding of patient or resi5 dent abuse’’ means any substantiated finding 

6 by a State agency under section 1819(g)(1)(C) 

7 or 1919(g)(1)(C) of the Social Security Act (42 

8 U.S.C. 1395i–3(g)(1)(C), 1396r(g)(1)(C)) or a 

9 Federal agency that a direct patient access em10 ployee has committed— 

11 (i) an act of patient or resident abuse 

12 or neglect or a misappropriation of patient 

13 or resident property; or 

14 (ii) such other types of acts as a par15 ticipating State may specify for purposes 

16 of conducting the program in such State. 

17 (D) DIRECT PATIENT ACCESS EM18 PLOYEE.—The term ‘‘direct patient access em19 ployee’’ means any individual who has access to 

20 a patient or resident of a long-term care facility 

21 or provider through employment or through a 

22 contract with such facility or provider and has 

23 duties that involve (or may involve) one-on-one 

24 contact with a patient or resident of the facility 

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1 poses of the nationwide program. Such term 

2 does not include a volunteer unless the volun3 teer has duties that are equivalent to the duties 

4 of a direct patient access employee and those 

5 duties involve (or may involve) one-on-one con6 tact with a patient or resident of the long-term 

7 care facility or provider. 

8 (E) LONG-TERM CARE FACILITY OR PRO9 VIDER.—The term ‘‘long-term care facility or 

10 provider’’ means the following facilities or pro11 viders which receive payment for services under 

12 title XVIII or XIX of the Social Security Act: 

13 (i) A skilled nursing facility (as de14 fined in section 1819(a) of the Social Secu15 rity Act (42 U.S.C. 1395i–3(a))). 

16 (ii) A nursing facility (as defined in 

17 section 1919(a) of such Act (42 U.S.C. 

18 1396r(a))). 

19 (iii) A home health agency. 

20 (iv) A provider of hospice care (as de21 fined in section 1861(dd)(1) of such Act 

22 (42 U.S.C. 1395x(dd)(1))). 

23 (v) A long-term care hospital (as de24 scribed in section 1886(d)(1)(B)(iv) of 


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1 such Act (42 U.S.C. 

2 1395ww(d)(1)(B)(iv))). 

3 (vi) A provider of personal care serv4 ices. 

5 (vii) A provider of adult day care. 

6 (viii) A residential care provider that 

7 arranges for, or directly provides, long8 term care services, including an assisted 

9 living facility that provides a level of care 

10 established by the Secretary. 

11 (ix) An intermediate care facility for 

12 the mentally retarded (as defined in sec13 tion 1905(d) of such Act (42 U.S.C. 

14 1396d(d))). 

15 (x) Any other facility or provider of 

16 long-term care services under such titles as 

17 the participating State determines appro18 priate. 

19 (7) EVALUATION AND REPORT.— 

20 (A) EVALUATION.— 

21 (i) IN GENERAL.—The Inspector Gen22 eral of the Department of Health and 

23 Human Services shall conduct an evalua24 tion of the nationwide program. 


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1 (ii) INCLUSION OF SPECIFIC TOP2 ICS.—The evaluation conducted under 

3 clause (i) shall include the following: 

4 (I) A review of the various proce5 dures implemented by participating 

6 States for long-term care facilities or 

7 providers, including staffing agencies, 

8 to conduct background checks of di9 rect patient access employees under 

10 the nationwide program and identi11 fication of the most appropriate, effi12 cient, and effective procedures for 

13 conducting such background checks. 

14 (II) An assessment of the costs 

15 of conducting such background checks 

16 (including start up and administrative 

17 costs). 

18 (III) A determination of the ex19 tent to which conducting such back20 ground checks leads to any unin21 tended consequences, including a re22 duction in the available workforce for 

23 long-term care facilities or providers. 

24 (IV) An assessment of the impact 

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1 ing the number of incidents of neglect, 

2 abuse, and misappropriation of resi3 dent property to the extent prac4 ticable. 

5 (V) An evaluation of other as6 pects of the nationwide program, as 

7 determined appropriate by the Sec8 retary. 

9 (B) REPORT.—Not later than 180 days 

10 after the completion of the nationwide program, 

11 the Inspector General of the Department of 

12 Health and Human Services shall submit a re13 port to Congress containing the results of the 

14 evaluation conducted under subparagraph (A). 

15 (b) FUNDING.— 

16 (1) NOTIFICATION.—The Secretary of Health 

17 and Human Services shall notify the Secretary of 

18 the Treasury of the amount necessary to carry out 

19 the nationwide program under this section for the 

20 period of fiscal years 2010 through 2012, except 

21 that in no case shall such amount exceed 

22 $160,000,000. 

23 (2) TRANSFER OF FUNDS.— 

24 (A) IN GENERAL.—Out of any funds in the 

25 Treasury not otherwise appropriated, the SecVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01647 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 retary of the Treasury shall provide for the 

2 transfer to the Secretary of Health and Human 

3 Services of the amount specified as necessary to 

4 carry out the nationwide program under para5 graph (1). Such amount shall remain available 

6 until expended. 

7 (B) RESERVATION OF FUNDS FOR CON8 DUCT OF EVALUATION.—The Secretary may re9 serve not more than $3,000,000 of the amount 

10 transferred under subparagraph (A) to provide 

11 for the conduct of the evaluation under sub12 section (a)(7)(A). 

13 Subtitle D—Patient-Centered 

14 Outcomes Research 

15 SEC. 6301. PATIENT-CENTERED OUTCOMES RESEARCH. 

16 (a) IN GENERAL.—Title XI of the Social Security Act 

17 (42 U.S.C. 1301 et seq.) is amended by adding at the end 

18 the following new part: 

19 ‘‘PART D—COMPARATIVE CLINICAL EFFECTIVENESS

20 RESEARCH

21 ‘‘COMPARATIVE CLINICAL EFFECTIVENESS RESEARCH

22 ‘‘SEC. 1181. (a) DEFINITIONS.—In this section: 

23 ‘‘(1) BOARD.—The term ‘Board’ means the 

24 Board of Governors established under subsection (f). 


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1 ‘‘(2) COMPARATIVE CLINICAL EFFECTIVENESS

2 RESEARCH; RESEARCH.— 

3 ‘‘(A) IN GENERAL.—The terms ‘compara4 tive clinical effectiveness research’ and ‘re5 search’ mean research evaluating and com6 paring health outcomes and the clinical effec7 tiveness, risks, and benefits of 2 or more med8 ical treatments, services, and items described in 

9 subparagraph (B). 

10 ‘‘(B) MEDICAL TREATMENTS, SERVICES, 

11 AND ITEMS DESCRIBED.—The medical treat12 ments, services, and items described in this sub13 paragraph are health care interventions, proto14 cols for treatment, care management, and deliv15 ery, procedures, medical devices, diagnostic 

16 tools, pharmaceuticals (including drugs and 

17 biologicals), integrative health practices, and 

18 any other strategies or items being used in the 

19 treatment, management, and diagnosis of, or 

20 prevention of illness or injury in, individuals. 

21 ‘‘(3) CONFLICT OF INTEREST.—The term ‘con22 flict of interest’ means an association, including a fi23 nancial or personal association, that have the poten24 tial to bias or have the appearance of biasing an inVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01649 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 dividual’s decisions in matters related to the Insti2 tute or the conduct of activities under this section. 

3 ‘‘(4) REAL CONFLICT OF INTEREST.—The term 

4 ‘real conflict of interest’ means any instance where 

5 a member of the Board, the methodology committee 

6 established under subsection (d)(6), or an advisory 

7 panel appointed under subsection (d)(4), or a close 

8 relative of such member, has received or could re9 ceive either of the following: 

10 ‘‘(A) A direct financial benefit of any 

11 amount deriving from the result or findings of 

12 a study conducted under this section. 

13 ‘‘(B) A financial benefit from individuals 

14 or companies that own or manufacture medical 

15 treatments, services, or items to be studied 

16 under this section that in the aggregate exceeds 

17 $10,000 per year. For purposes of the pre18 ceding sentence, a financial benefit includes 

19 honoraria, fees, stock, or other financial benefit 

20 and the current value of the member or close 

21 relative’s already existing stock holdings, in ad22 dition to any direct financial benefit deriving 

23 from the results or findings of a study con24 ducted under this section. 


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1 ‘‘(b) PATIENT-CENTERED OUTCOMES RESEARCH IN2 STITUTE.— 

3 ‘‘(1) ESTABLISHMENT.—There is authorized to 

4 be established a nonprofit corporation, to be known 

5 as the ‘Patient-Centered Outcomes Research Insti6 tute’ (referred to in this section as the ‘Institute’) 

7 which is neither an agency nor establishment of the 

8 United States Government. 

9 ‘‘(2) APPLICATION OF PROVISIONS.—The Insti10 tute shall be subject to the provisions of this section, 

11 and, to the extent consistent with this section, to the 

12 District of Columbia Nonprofit Corporation Act. 

13 ‘‘(3) FUNDING OF COMPARATIVE CLINICAL EF14 FECTIVENESS RESEARCH.—For fiscal year 2010 and 

15 each subsequent fiscal year, amounts in the Patient16 Centered Outcomes Research Trust Fund (referred 

17 to in this section as the ‘PCORTF’) under section 

18 9511 of the Internal Revenue Code of 1986 shall be 

19 available, without further appropriation, to the Insti20 tute to carry out this section. 

21 ‘‘(c) PURPOSE.—The purpose of the Institute is to 

22 assist patients, clinicians, purchasers, and policy-makers 

23 in making informed health decisions by advancing the 

24 quality and relevance of evidence concerning the manner 

25 in which diseases, disorders, and other health conditions 


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1 can effectively and appropriately be prevented, diagnosed, 

2 treated, monitored, and managed through research and 

3 evidence synthesis that considers variations in patient sub4 populations, and the dissemination of research findings 

5 with respect to the relative health outcomes, clinical effec6 tiveness, and appropriateness of the medical treatments, 

7 services, and items described in subsection (a)(2)(B). 

8 ‘‘(d) DUTIES.— 

9 ‘‘(1) IDENTIFYING RESEARCH PRIORITIES AND

10 ESTABLISHING RESEARCH PROJECT AGENDA.— 

11 ‘‘(A) IDENTIFYING RESEARCH PRIOR12 ITIES.—The Institute shall identify national 

13 priorities for research, taking into account fac14 tors of disease incidence, prevalence, and bur15 den in the United States (with emphasis on 

16 chronic conditions), gaps in evidence in terms of 

17 clinical outcomes, practice variations and health 

18 disparities in terms of delivery and outcomes of 

19 care, the potential for new evidence to improve 

20 patient health, well-being, and the quality of 

21 care, the effect on national expenditures associ22 ated with a health care treatment, strategy, or 

23 health conditions, as well as patient needs, out24 comes, and preferences, the relevance to pa25 tients and clinicians in making informed health 


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1 decisions, and priorities in the National Strat2 egy for quality care established under section 

3 399H of the Public Health Service Act that are 

4 consistent with this section. 

5 ‘‘(B) ESTABLISHING RESEARCH PROJECT

6 AGENDA.—The Institute shall establish and up7 date a research project agenda for research to 

8 address the priorities identified under subpara9 graph (A), taking into consideration the types 

10 of research that might address each priority 

11 and the relative value (determined based on the 

12 cost of conducting research compared to the po13 tential usefulness of the information produced 

14 by research) associated with the different types 

15 of research, and such other factors as the Insti16 tute determines appropriate. 

17 ‘‘(2) CARRYING OUT RESEARCH PROJECT AGEN18 DA.— 

19 ‘‘(A) RESEARCH.—The Institute shall 

20 carry out the research project agenda estab21 lished under paragraph (1)(B) in accordance 

22 with the methodological standards adopted 

23 under paragraph (9) using methods, including 

24 the following: 


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1 ‘‘(i) Systematic reviews and assess2 ments of existing and future research and 

3 evidence including original research con4 ducted subsequent to the date of the enact5 ment of this section. 

6 ‘‘(ii) Primary research, such as ran7 domized clinical trials, molecularly in8 formed trials, and observational studies. 

9 ‘‘(iii) Any other methodologies rec10 ommended by the methodology committee 

11 established under paragraph (6) that are 

12 adopted by the Board under paragraph 

13 (9). 

14 ‘‘(B) CONTRACTS FOR THE MANAGEMENT

15 OF FUNDING AND CONDUCT OF RESEARCH.— 

16 ‘‘(i) CONTRACTS.— 

17 ‘‘(I) IN GENERAL.—In accord18 ance with the research project agenda 

19 established under paragraph (1)(B), 

20 the Institute shall enter into contracts 

21 for the management of funding and 

22 conduct of research in accordance 

23 with the following: 


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1 ‘‘(aa) Appropriate agencies 

2 and instrumentalities of the Fed3 eral Government. 

4 ‘‘(bb) Appropriate academic 

5 research, private sector research, 

6 or study-conducting entities. 

7 ‘‘(II) PREFERENCE.—In entering 

8 into contracts under subclause (I), the 

9 Institute shall give preference to the 

10 Agency for Healthcare Research and 

11 Quality and the National Institutes of 

12 Health, but only if the research to be 

13 conducted or managed under such 

14 contract is authorized by the gov15 erning statutes of such Agency or In16 stitutes. 

17 ‘‘(ii) CONDITIONS FOR CONTRACTS.— 

18 A contract entered into under this sub19 paragraph shall require that the agency, 

20 instrumentality, or other entity— 

21 ‘‘(I) abide by the transparency 

22 and conflicts of interest requirements 

23 under subsection (h) that apply to the 

24 Institute with respect to the research 


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1 managed or conducted under such 

2 contract; 

3 ‘‘(II) comply with the methodo4 logical standards adopted under para5 graph (9) with respect to such re6 search; 

7 ‘‘(III) consult with the expert ad8 visory panels for clinical trials and 

9 rare disease appointed under clauses 

10 (ii) and (iii), respectively, of para11 graph (4)(A); 

12 ‘‘(IV) subject to clause (iv), per13 mit a researcher who conducts origi14 nal research under the contract for 

15 the agency, instrumentality, or other 

16 entity to have such research published 

17 in a peer-reviewed journal or other 

18 publication; 

19 ‘‘(V) have appropriate processes 

20 in place to manage data privacy and 

21 meet ethical standards for the re22 search; 

23 ‘‘(VI) comply with the require24 ments of the Institute for making the 


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1 information available to the public 

2 under paragraph (8); and 

3 ‘‘(VII) comply with other terms 

4 and conditions determined necessary 

5 by the Institute to carry out the re6 search agenda adopted under para7 graph (2). 

8 ‘‘(iii) COVERAGE OF COPAYMENTS OR

9 COINSURANCE.—A contract entered into 

10 under this subparagraph may allow for the 

11 coverage of copayments or coinsurance, or 

12 allow for other appropriate measures, to 

13 the extent that such coverage or other 

14 measures are necessary to preserve the va15 lidity of a research project, such as in the 

16 case where the research project must be 

17 blinded. 

18 ‘‘(iv) REQUIREMENTS FOR PUBLICA19 TION OF RESEARCH.—Any research pub20 lished under clause (ii)(IV) shall be within 

21 the bounds of and entirely consistent with 

22 the evidence and findings produced under 

23 the contract with the Institute under this 

24 subparagraph. If the Institute determines 

25 that those requirements are not met, the 


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1 Institute shall not enter into another con2 tract with the agency, instrumentality, or 

3 entity which managed or conducted such 

4 research for a period determined appro5 priate by the Institute (but not less than 

6 5 years). 

7 ‘‘(C) REVIEW AND UPDATE OF EVI8 DENCE.—The Institute shall review and update 

9 evidence on a periodic basis as appropriate. 

10 ‘‘(D) TAKING INTO ACCOUNT POTENTIAL

11 DIFFERENCES.—Research shall be designed, as 

12 appropriate, to take into account the potential 

13 for differences in the effectiveness of health 

14 care treatments, services, and items as used 

15 with various subpopulations, such as racial and 

16 ethnic minorities, women, age, and groups of 

17 individuals with different comorbidities, genetic 

18 and molecular sub-types, or quality of life pref19 erences and include members of such sub20 populations as subjects in the research as fea21 sible and appropriate. 

22 ‘‘(E) DIFFERENCES IN TREATMENT MO23 DALITIES.—Research shall be designed, as ap24 propriate, to take into account different charac25 teristics of treatment modalities that may affect 


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1 research outcomes, such as the phase of the 

2 treatment modality in the innovation cycle and 

3 the impact of the skill of the operator of the 

4 treatment modality. 

5 ‘‘(3) DATA COLLECTION.— 

6 ‘‘(A) IN GENERAL.—The Secretary shall, 

7 with appropriate safeguards for privacy, make 

8 available to the Institute such data collected by 

9 the Centers for Medicare & Medicaid Services 

10 under the programs under titles XVIII, XIX, 

11 and XXI, as well as provide access to the data 

12 networks developed under section 937(f) of the 

13 Public Health Service Act, as the Institute and 

14 its contractors may require to carry out this 

15 section. The Institute may also request and ob16 tain data from Federal, State, or private enti17 ties, including data from clinical databases and 

18 registries. 

19 ‘‘(B) USE OF DATA.—The Institute shall 

20 only use data provided to the Institute under 

21 subparagraph (A) in accordance with laws and 

22 regulations governing the release and use of 

23 such data, including applicable confidentiality 

24 and privacy standards. 

25 ‘‘(4) APPOINTING EXPERT ADVISORY PANELS.— 


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1 ‘‘(A) APPOINTMENT.— 

2 ‘‘(i) IN GENERAL.—The Institute may 

3 appoint permanent or ad hoc expert advi4 sory panels as determined appropriate to 

5 assist in identifying research priorities and 

6 establishing the research project agenda 

7 under paragraph (1) and for other pur8 poses. 

9 ‘‘(ii) EXPERT ADVISORY PANELS FOR

10 CLINICAL TRIALS.—The Institute shall ap11 point expert advisory panels in carrying 

12 out randomized clinical trials under the re13 search project agenda under paragraph 

14 (2)(A)(ii). Such expert advisory panels 

15 shall advise the Institute and the agency, 

16 instrumentality, or entity conducting the 

17 research on the research question involved 

18 and the research design or protocol, includ19 ing important patient subgroups and other 

20 parameters of the research. Such panels 

21 shall be available as a resource for tech22 nical questions that may arise during the 

23 conduct of such research. 

24 ‘‘(iii) EXPERT ADVISORY PANEL FOR

25 RARE DISEASE.—In the case of a research 


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1 study for rare disease, the Institute shall 

2 appoint an expert advisory panel for pur3 poses of assisting in the design of the re4 search study and determining the relative 

5 value and feasibility of conducting the re6 search study. 

7 ‘‘(B) COMPOSITION.—An expert advisory 

8 panel appointed under subparagraph (A) shall 

9 include representatives of practicing and re10 search clinicians, patients, and experts in sci11 entific and health services research, health serv12 ices delivery, and evidence-based medicine who 

13 have experience in the relevant topic, and as ap14 propriate, experts in integrative health and pri15 mary prevention strategies. The Institute may 

16 include a technical expert of each manufacturer 

17 or each medical technology that is included 

18 under the relevant topic, project, or category 

19 for which the panel is established. 

20 ‘‘(5) SUPPORTING PATIENT AND CONSUMER

21 REPRESENTATIVES.—The Institute shall provide 

22 support and resources to help patient and consumer 

23 representatives effectively participate on the Board 

24 and expert advisory panels appointed by the Insti25 tute under paragraph (4). 


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1 ‘‘(6) ESTABLISHING METHODOLOGY COM2 MITTEE.— 

3 ‘‘(A) IN GENERAL.—The Institute shall es4 tablish a standing methodology committee to 

5 carry out the functions described in subpara6 graph (C). 

7 ‘‘(B) APPOINTMENT AND COMPOSITION.— 

8 The methodology committee established under 

9 subparagraph (A) shall be composed of not 

10 more than 15 members appointed by the Comp11 troller General of the United States. Members 

12 appointed to the methodology committee shall 

13 be experts in their scientific field, such as 

14 health services research, clinical research, com15 parative clinical effectiveness research, bio16 statistics, genomics, and research methodolo17 gies. Stakeholders with such expertise may be 

18 appointed to the methodology committee. In ad19 dition to the members appointed under the first 

20 sentence, the Directors of the National Insti21 tutes of Health and the Agency for Healthcare 

22 Research and Quality (or their designees) shall 

23 each be included as members of the method24 ology committee. 


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1 ‘‘(C) FUNCTIONS.—Subject to subpara2 graph (D), the methodology committee shall 

3 work to develop and improve the science and 

4 methods of comparative clinical effectiveness re5 search by, not later than 18 months after the 

6 establishment of the Institute, directly or 

7 through subcontract, developing and periodi8 cally updating the following: 

9 ‘‘(i) Methodological standards for re10 search. Such methodological standards 

11 shall provide specific criteria for internal 

12 validity, generalizability, feasibility, and 

13 timeliness of research and for health out14 comes measures, risk adjustment, and 

15 other relevant aspects of research and as16 sessment with respect to the design of re17 search. Any methodological standards de18 veloped and updated under this subclause 

19 shall be scientifically based and include 

20 methods by which new information, data, 

21 or advances in technology are considered 

22 and incorporated into ongoing research 

23 projects by the Institute, as appropriate. 

24 The process for developing and updating 

25 such standards shall include input from 


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1 relevant experts, stakeholders, and deci2 sionmakers, and shall provide opportunities 

3 for public comment. Such standards shall 

4 also include methods by which patient sub5 populations can be accounted for and eval6 uated in different types of research. As ap7 propriate, such standards shall build on ex8 isting work on methodological standards 

9 for defined categories of health interven10 tions and for each of the major categories 

11 of comparative clinical effectiveness re12 search methods (determined as of the date 

13 of enactment of the Patient Protection and 

14 Affordable Care Act). 

15 ‘‘(ii) A translation table that is de16 signed to provide guidance and act as a 

17 reference for the Board to determine re18 search methods that are most likely to ad19 dress each specific research question. 

20 ‘‘(D) CONSULTATION AND CONDUCT OF

21 EXAMINATIONS.—The methodology committee 

22 may consult and contract with the Institute of 

23 Medicine of the National Academies and aca24 demic, nonprofit, or other private and govern25 mental entities with relevant expertise to carry 


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1 out activities described in subparagraph (C) 

2 and may consult with relevant stakeholders to 

3 carry out such activities. 

4 ‘‘(E) REPORTS.—The methodology com5 mittee shall submit reports to the Board on the 

6 committee’s performance of the functions de7 scribed in subparagraph (C). Reports shall con8 tain recommendations for the Institute to adopt 

9 methodological standards developed and up10 dated by the methodology committee as well as 

11 other actions deemed necessary to comply with 

12 such methodological standards. 

13 ‘‘(7) PROVIDING FOR A PEER-REVIEW PROCESS

14 FOR PRIMARY RESEARCH.— 

15 ‘‘(A) IN GENERAL.—The Institute shall en16 sure that there is a process for peer review of 

17 primary research described in subparagraph 

18 (A)(ii) of paragraph (2) that is conducted under 

19 such paragraph. Under such process— 

20 ‘‘(i) evidence from such primary re21 search shall be reviewed to assess scientific 

22 integrity and adherence to methodological 

23 standards adopted under paragraph (9); 

24 and 


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1 ‘‘(ii) a list of the names of individuals 

2 contributing to any peer-review process 

3 during the preceding year or years shall be 

4 made public and included in annual reports 

5 in accordance with paragraph (10)(D). 

6 ‘‘(B) COMPOSITION.—Such peer-review 

7 process shall be designed in a manner so as to 

8 avoid bias and conflicts of interest on the part 

9 of the reviewers and shall be composed of ex10 perts in the scientific field relevant to the re11 search under review. 

12 ‘‘(C) USE OF EXISTING PROCESSES.— 

13 ‘‘(i) PROCESSES OF ANOTHER ENTI14 TY.—In the case where the Institute enters 

15 into a contract or other agreement with 

16 another entity for the conduct or manage17 ment of research under this section, the 

18 Institute may utilize the peer-review proc19 ess of such entity if such process meets the 

20 requirements under subparagraphs (A) and 

21 (B). 

22 ‘‘(ii) PROCESSES OF APPROPRIATE

23 MEDICAL JOURNALS.—The Institute may 

24 utilize the peer-review process of appro25 priate medical journals if such process 


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1 meets the requirements under subpara2 graphs (A) and (B). 

3 ‘‘(8) RELEASE OF RESEARCH FINDINGS.— 

4 ‘‘(A) IN GENERAL.—The Institute shall, 

5 not later than 90 days after the conduct or re6 ceipt of research findings under this part, make 

7 such research findings available to clinicians, 

8 patients, and the general public. The Institute 

9 shall ensure that the research findings— 

10 ‘‘(i) convey the findings of research in 

11 a manner that is comprehensible and use12 ful to patients and providers in making 

13 health care decisions; 

14 ‘‘(ii) fully convey findings and discuss 

15 considerations specific to certain sub16 populations, risk factors, and 

17 comorbidities, as appropriate; 

18 ‘‘(iii) include limitations of the re19 search and what further research may be 

20 needed as appropriate; 

21 ‘‘(iv) not be construed as mandates 

22 for practice guidelines, coverage rec23 ommendations, payment, or policy rec24 ommendations; and 


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1 ‘‘(v) not include any data which would 

2 violate the privacy of research participants 

3 or any confidentiality agreements made 

4 with respect to the use of data under this 

5 section. 

6 ‘‘(B) DEFINITION OF RESEARCH FIND7 INGS.—In this paragraph, the term ‘research 

8 findings’ means the results of a study or assess9 ment. 

10 ‘‘(9) ADOPTION.—Subject to subsection (h)(1), 

11 the Institute shall adopt the national priorities iden12 tified under paragraph (1)(A), the research project 

13 agenda established under paragraph (1)(B), the 

14 methodological standards developed and updated by 

15 the methodology committee under paragraph 

16 (6)(C)(i), and any peer-review process provided 

17 under paragraph (7) by majority vote. In the case 

18 where the Institute does not adopt such processes in 

19 accordance with the preceding sentence, the proc20 esses shall be referred to the appropriate staff or en21 tity within the Institute (or, in the case of the meth22 odological standards, the methodology committee) 

23 for further review. 

24 ‘‘(10) ANNUAL REPORTS.—The Institute shall 

25 submit an annual report to Congress and the PresiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01668 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 dent, and shall make the annual report available to 

2 the public. Such report shall contain— 

3 ‘‘(A) a description of the activities con4 ducted under this section, research priorities 

5 identified under paragraph (1)(A) and methodo6 logical standards developed and updated by the 

7 methodology committee under paragraph 

8 (6)(C)(i) that are adopted under paragraph (9) 

9 during the preceding year; 

10 ‘‘(B) the research project agenda and 

11 budget of the Institute for the following year; 

12 ‘‘(C) any administrative activities con13 ducted by the Institute during the preceding 

14 year; 

15 ‘‘(D) the names of individuals contributing 

16 to any peer-review process under paragraph (7), 

17 without identifying them with a particular re18 search project; and 

19 ‘‘(E) any other relevant information (in20 cluding information on the membership of the 

21 Board, expert advisory panels, methodology 

22 committee, and the executive staff of the Insti23 tute, any conflicts of interest with respect to 

24 these individuals, and any bylaws adopted by 

25 the Board during the preceding year). 


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1 ‘‘(e) ADMINISTRATION.— 

2 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

3 the Board shall carry out the duties of the Institute. 

4 ‘‘(2) NONDELEGABLE DUTIES.—The activities 

5 described in subsections (d)(1) and (d)(9) are non6 delegable. 

7 ‘‘(f) BOARD OF GOVERNORS.— 

8 ‘‘(1) IN GENERAL.—The Institute shall have a 

9 Board of Governors, which shall consist of the fol10 lowing members: 

11 ‘‘(A) The Director of Agency for 

12 Healthcare Research and Quality (or the Direc13 tor’s designee). 

14 ‘‘(B) The Director of the National Insti15 tutes of Health (or the Director’s designee). 

16 ‘‘(C) Seventeen members appointed, not 

17 later than 6 months after the date of enactment 

18 of this section, by the Comptroller General of 

19 the United States as follows: 

20 ‘‘(i) 3 members representing patients 

21 and health care consumers. 

22 ‘‘(ii) 5 members representing physi23 cians and providers, including at least 1 

24 surgeon, nurse, State-licensed integrative 


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1 health care practitioner, and representative 

2 of a hospital. 

3 ‘‘(iii) 3 members representing private 

4 payers, of whom at least 1 member shall 

5 represent health insurance issuers and at 

6 least 1 member shall represent employers 

7 who self-insure employee benefits. 

8 ‘‘(iv) 3 members representing pharma9 ceutical, device, and diagnostic manufac10 turers or developers. 

11 ‘‘(v) 1 member representing quality 

12 improvement or independent health service 

13 researchers. 

14 ‘‘(vi) 2 members representing the 

15 Federal Government or the States, includ16 ing at least 1 member representing a Fed17 eral health program or agency. 

18 ‘‘(2) QUALIFICATIONS.—The Board shall rep19 resent a broad range of perspectives and collectively 

20 have scientific expertise in clinical health sciences re21 search, including epidemiology, decisions sciences, 

22 health economics, and statistics. In appointing the 

23 Board, the Comptroller General of the United States 

24 shall consider and disclose any conflicts of interest 

25 in accordance with subsection (h)(4)(B). Members of 


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1 the Board shall be recused from relevant Institute 

2 activities in the case where the member (or an im3 mediate family member of such member) has a real 

4 conflict of interest directly related to the research 

5 project or the matter that could affect or be affected 

6 by such participation. 

7 ‘‘(3) TERMS; VACANCIES.—A member of the 

8 Board shall be appointed for a term of 6 years, ex9 cept with respect to the members first appointed, 

10 whose terms of appointment shall be staggered even11 ly over 2-year increments. No individual shall be ap12 pointed to the Board for more than 2 terms. Vacan13 cies shall be filled in the same manner as the origi14 nal appointment was made. 

15 ‘‘(4) CHAIRPERSON AND VICE-CHAIRPERSON.— 

16 The Comptroller General of the United States shall 

17 designate a Chairperson and Vice Chairperson of the 

18 Board from among the members of the Board. Such 

19 members shall serve as Chairperson or Vice Chair20 person for a period of 3 years. 

21 ‘‘(5) COMPENSATION.—Each member of the 

22 Board who is not an officer or employee of the Fed23 eral Government shall be entitled to compensation 

24 (equivalent to the rate provided for level IV of the 

25 Executive Schedule under section 5315 of title 5, 


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1 United States Code) and expenses incurred while 

2 performing the duties of the Board. An officer or 

3 employee of the Federal government who is a mem4 ber of the Board shall be exempt from compensa5 tion. 

6 ‘‘(6) DIRECTOR AND STAFF; EXPERTS AND

7 CONSULTANTS.—The Board may employ and fix the 

8 compensation of an Executive Director and such 

9 other personnel as may be necessary to carry out the 

10 duties of the Institute and may seek such assistance 

11 and support of, or contract with, experts and con12 sultants that may be necessary for the performance 

13 of the duties of the Institute. 

14 ‘‘(7) MEETINGS AND HEARINGS.—The Board 

15 shall meet and hold hearings at the call of the 

16 Chairperson or a majority of its members. Meetings 

17 not solely concerning matters of personnel shall be 

18 advertised at least 7 days in advance and open to 

19 the public. A majority of the Board members shall 

20 constitute a quorum, but a lesser number of mem21 bers may meet and hold hearings. 

22 ‘‘(g) FINANCIAL AND GOVERNMENTAL OVER23 SIGHT.— 

24 ‘‘(1) CONTRACT FOR AUDIT.—The Institute 

25 shall provide for the conduct of financial audits of 


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1 the Institute on an annual basis by a private entity 

2 with expertise in conducting financial audits. 

3 ‘‘(2) REVIEW AND ANNUAL REPORTS.— 

4 ‘‘(A) REVIEW.—The Comptroller General 

5 of the United States shall review the following: 

6 ‘‘(i) Not less frequently than on an 

7 annual basis, the financial audits con8 ducted under paragraph (1). 

9 ‘‘(ii) Not less frequently than every 5 

10 years, the processes established by the In11 stitute, including the research priorities 

12 and the conduct of research projects, in 

13 order to determine whether information 

14 produced by such research projects is ob15 jective and credible, is produced in a man16 ner consistent with the requirements under 

17 this section, and is developed through a 

18 transparent process. 

19 ‘‘(iii) Not less frequently than every 5 

20 years, the dissemination and training ac21 tivities and data networks established 

22 under section 937 of the Public Health 

23 Service Act, including the methods and 

24 products used to disseminate research, the 

25 types of training conducted and supported, 


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1 and the types and functions of the data 

2 networks established, in order to determine 

3 whether the activities and data are pro4 duced in a manner consistent with the re5 quirements under such section. 

6 ‘‘(iv) Not less frequently than every 5 

7 years, the overall effectiveness of activities 

8 conducted under this section and the dis9 semination, training, and capacity building 

10 activities conducted under section 937 of 

11 the Public Health Service Act. Such review 

12 shall include an analysis of the extent to 

13 which research findings are used by health 

14 care decision-makers, the effect of the dis15 semination of such findings on reducing 

16 practice variation and disparities in health 

17 care, and the effect of the research con18 ducted and disseminated on innovation and 

19 the health care economy of the United 

20 States. 

21 ‘‘(v) Not later than 8 years after the 

22 date of enactment of this section, the ade23 quacy and use of the funding for the Insti24 tute and the activities conducted under 

25 section 937 of the Public Health Service 


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1 Act, including a determination as to 

2 whether, based on the utilization of re3 search findings by public and private pay4 ers, funding sources for the Patient-Cen5 tered Outcomes Research Trust Fund 

6 under section 9511 of the Internal Rev7 enue Code of 1986 are appropriate and 

8 whether such sources of funding should be 

9 continued or adjusted. 

10 ‘‘(B) ANNUAL REPORTS.—Not later than 

11 April 1 of each year, the Comptroller General 

12 of the United States shall submit to Congress 

13 a report containing the results of the review 

14 conducted under subparagraph (A) with respect 

15 to the preceding year (or years, if applicable), 

16 together with recommendations for such legisla17 tion and administrative action as the Comp18 troller General determines appropriate. 

19 ‘‘(h) ENSURING TRANSPARENCY, CREDIBILITY, AND

20 ACCESS.—The Institute shall establish procedures to en21 sure that the following requirements for ensuring trans22 parency, credibility, and access are met: 

23 ‘‘(1) PUBLIC COMMENT PERIODS.—The Insti24 tute shall provide for a public comment period of not 

25 less than 45 days and not more than 60 days prior 


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1 to the adoption under subsection (d)(9) of the na2 tional priorities identified under subsection 

3 (d)(1)(A), the research project agenda established 

4 under subsection (d)(1)(B), the methodological 

5 standards developed and updated by the method6 ology committee under subsection (d)(6)(C)(i), and 

7 the peer-review process provided under paragraph 

8 (7), and after the release of draft findings with re9 spect to systematic reviews of existing research and 

10 evidence. 

11 ‘‘(2) ADDITIONAL FORUMS.—The Institute shall 

12 support forums to increase public awareness and ob13 tain and incorporate public input and feedback 

14 through media (such as an Internet website) on re15 search priorities, research findings, and other duties, 

16 activities, or processes the Institute determines ap17 propriate. 

18 ‘‘(3) PUBLIC AVAILABILITY.—The Institute 

19 shall make available to the public and disclose 

20 through the official public Internet website of the In21 stitute the following: 

22 ‘‘(A) Information contained in research 

23 findings as specified in subsection (d)(9). 

24 ‘‘(B) The process and methods for the con25 duct of research, including the identity of the 


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1 entity and the investigators conducing such re2 search and any conflicts of interests of such 

3 parties, any direct or indirect links the entity 

4 has to industry, and research protocols, includ5 ing measures taken, methods of research and 

6 analysis, research results, and such other infor7 mation the Institute determines appropriate) 

8 concurrent with the release of research findings. 

9 ‘‘(C) Notice of public comment periods 

10 under paragraph (1), including deadlines for 

11 public comments. 

12 ‘‘(D) Subsequent comments received dur13 ing each of the public comment periods. 

14 ‘‘(E) In accordance with applicable laws 

15 and processes and as the Institute determines 

16 appropriate, proceedings of the Institute. 

17 ‘‘(4) DISCLOSURE OF CONFLICTS OF INTER18 EST.— 

19 ‘‘(A) IN GENERAL.—A conflict of interest 

20 shall be disclosed in the following manner: 

21 ‘‘(i) By the Institute in appointing 

22 members to an expert advisory panel under 

23 subsection (d)(4), in selecting individuals 

24 to contribute to any peer-review process 


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1 under subsection (d)(7), and for employ2 ment as executive staff of the Institute. 

3 ‘‘(ii) By the Comptroller General in 

4 appointing members of the methodology 

5 committee under subsection (d)(6); 

6 ‘‘(iii) By the Institute in the annual 

7 report under subsection (d)(10), except 

8 that, in the case of individuals contributing 

9 to any such peer review process, such de10 scription shall be in a manner such that 

11 those individuals cannot be identified with 

12 a particular research project. 

13 ‘‘(B) MANNER OF DISCLOSURE.—Conflicts 

14 of interest shall be disclosed as described in 

15 subparagraph (A) as soon as practicable on the 

16 Internet web site of the Institute and of the 

17 Government Accountability Office. The informa18 tion disclosed under the preceding sentence 

19 shall include the type, nature, and magnitude of 

20 the interests of the individual involved, except 

21 to the extent that the individual recuses himself 

22 or herself from participating in the consider23 ation of or any other activity with respect to the 

24 study as to which the potential conflict exists. 


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1 ‘‘(i) RULES.—The Institute, its Board or staff, shall 

2 be prohibited from accepting gifts, bequeaths, or donations 

3 of services or property. In addition, the Institute shall be 

4 prohibited from establishing a corporation or generating 

5 revenues from activities other than as provided under this 

6 section. 

7 ‘‘(j) RULES OF CONSTRUCTION.— 

8 ‘‘(1) COVERAGE.—Nothing in this section shall 

9 be construed— 

10 ‘‘(A) to permit the Institute to mandate 

11 coverage, reimbursement, or other policies for 

12 any public or private payer; or 

13 ‘‘(B) as preventing the Secretary from cov14 ering the routine costs of clinical care received 

15 by an individual entitled to, or enrolled for, ben16 efits under title XVIII, XIX, or XXI in the case 

17 where such individual is participating in a clin18 ical trial and such costs would otherwise be cov19 ered under such title with respect to the bene20 ficiary.’’. 

21 (b) DISSEMINATION AND BUILDING CAPACITY FOR

22 RESEARCH.—Title IX of the Public Health Service Act 

23 (42 U.S.C. 299 et seq.), as amended by section 3606, is 

24 further amended by inserting after section 936 the fol25 lowing: 


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1 ‘‘SEC. 937. DISSEMINATION AND BUILDING CAPACITY FOR 

2 RESEARCH. 

3 ‘‘(a) IN GENERAL.— 

4 ‘‘(1) DISSEMINATION.—The Office of Commu5 nication and Knowledge Transfer (referred to in this 

6 section as the ‘Office’) at the Agency for Healthcare 

7 Research and Quality (or any other relevant office 

8 designated by Agency for Healthcare Research and 

9 Quality), in consultation with the National Institutes 

10 of Health, shall broadly disseminate the research 

11 findings that are published by the Patient Centered 

12 Outcomes Research Institute established under sec13 tion 1181(b) of the Social Security Act (referred to 

14 in this section as the ‘Institute’) and other govern15 ment-funded research relevant to comparative clin16 ical effectiveness research. The Office shall create in17 formational tools that organize and disseminate re18 search findings for physicians, health care providers, 

19 patients, payers, and policy makers. The Office shall 

20 also develop a publicly available resource database 

21 that collects and contains government-funded evi22 dence and research from public, private, not-for 

23 profit, and academic sources. 

24 ‘‘(2) REQUIREMENTS.—The Office shall provide 

25 for the dissemination of the Institute’s research find26 ings and government-funded research relevant to 


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1 comparative clinical effectiveness research to physi2 cians, health care providers, patients, vendors of 

3 health information technology focused on clinical de4 cision support, appropriate professional associations, 

5 and Federal and private health plans. Materials, fo6 rums, and media used to disseminate the findings, 

7 informational tools, and resource databases shall— 

8 ‘‘(A) include a description of consider9 ations for specific subpopulations, the research 

10 methodology, and the limitations of the re11 search, and the names of the entities, agencies, 

12 instrumentalities, and individuals who con13 ducted any research which was published by the 

14 Institute; and 

15 ‘‘(B) not be construed as mandates, guide16 lines, or recommendations for payment, cov17 erage, or treatment. 

18 ‘‘(b) INCORPORATION OF RESEARCH FINDINGS.— 

19 The Office, in consultation with relevant medical and clin20 ical associations, shall assist users of health information 

21 technology focused on clinical decision support to promote 

22 the timely incorporation of research findings disseminated 

23 under subsection (a) into clinical practices and to promote 

24 the ease of use of such incorporation. 


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1 ‘‘(c) FEEDBACK.—The Office shall establish a proc2 ess to receive feedback from physicians, health care pro3 viders, patients, and vendors of health information tech4 nology focused on clinical decision support, appropriate 

5 professional associations, and Federal and private health 

6 plans about the value of the information disseminated and 

7 the assistance provided under this section. 

8 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec9 tion shall preclude the Institute from making its research 

10 findings publicly available as required under section 

11 1181(d)(8) of the Social Security Act. 

12 ‘‘(e) TRAINING OF RESEARCHERS.—The Agency for 

13 Health Care Research and Quality, in consultation with 

14 the National Institutes of Health, shall build capacity for 

15 comparative clinical effectiveness research by establishing 

16 a grant program that provides for the training of research17 ers in the methods used to conduct such research, includ18 ing systematic reviews of existing research and primary 

19 research such as clinical trials. At a minimum, such train20 ing shall be in methods that meet the methodological 

21 standards adopted under section 1181(d)(9) of the Social 

22 Security Act. 

23 ‘‘(f) BUILDING DATA FOR RESEARCH.—The Sec24 retary shall provide for the coordination of relevant Fed25 eral health programs to build data capacity for comparaVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01683 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tive clinical effectiveness research, including the develop2 ment and use of clinical registries and health outcomes 

3 research data networks, in order to develop and maintain 

4 a comprehensive, interoperable data network to collect, 

5 link, and analyze data on outcomes and effectiveness from 

6 multiple sources, including electronic health records. 

7 ‘‘(g) AUTHORITY TO CONTRACT WITH THE INSTI8 TUTE.—Agencies and instrumentalities of the Federal 

9 Government may enter into agreements with the Institute, 

10 and accept and retain funds, for the conduct and support 

11 of research described in this part, provided that the re12 search to be conducted or supported under such agree13 ments is authorized under the governing statutes of such 

14 agencies and instrumentalities.’’. 

15 (c) IN GENERAL.—Part D of title XI of the Social 

16 Security Act, as added by subsection (a), is amended by 

17 adding at the end the following new section: 

18 ‘‘LIMITATIONS ON CERTAIN USES OF COMPARATIVE

19 CLINICAL EFFECTIVENESS RESEARCH

20 ‘‘SEC. 1182. (a) The Secretary may only use evidence 

21 and findings from research conducted under section 1181 

22 to make a determination regarding coverage under title 

23 XVIII if such use is through an iterative and transparent 

24 process which includes public comment and considers the 

25 effect on subpopulations. 

26 ‘‘(b) Nothing in section 1181 shall be construed as— 


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1 ‘‘(1) superceding or modifying the coverage of 

2 items or services under title XVIII that the Sec3 retary determines are reasonable and necessary 

4 under section 1862(l)(1); or 

5 ‘‘(2) authorizing the Secretary to deny coverage 

6 of items or services under such title solely on the 

7 basis of comparative clinical effectiveness research. 

8 ‘‘(c)(1) The Secretary shall not use evidence or find9 ings from comparative clinical effectiveness research con10 ducted under section 1181 in determining coverage, reim11 bursement, or incentive programs under title XVIII in a 

12 manner that treats extending the life of an elderly, dis13 abled, or terminally ill individual as of lower value than 

14 extending the life of an individual who is younger, non15 disabled, or not terminally ill. 

16 ‘‘(2) Paragraph (1) shall not be construed as pre17 venting the Secretary from using evidence or findings from 

18 such comparative clinical effectiveness research in deter19 mining coverage, reimbursement, or incentive programs 

20 under title XVIII based upon a comparison of the dif21 ference in the effectiveness of alternative treatments in ex22 tending an individual’s life due to the individual’s age, dis23 ability, or terminal illness. 

24 ‘‘(d)(1) The Secretary shall not use evidence or find25 ings from comparative clinical effectiveness research conVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01685 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ducted under section 1181 in determining coverage, reim2 bursement, or incentive programs under title XVIII in a 

3 manner that precludes, or with the intent to discourage, 

4 an individual from choosing a health care treatment based 

5 on how the individual values the tradeoff between extend6 ing the length of their life and the risk of disability. 

7 ‘‘(2)(A) Paragraph (1) shall not be construed to— 

8 ‘‘(i) limit the application of differential copay9 ments under title XVIII based on factors such as 

10 cost or type of service; or 

11 ‘‘(ii) prevent the Secretary from using evidence 

12 or findings from such comparative clinical effective13 ness research in determining coverage, reimburse14 ment, or incentive programs under such title based 

15 upon a comparison of the difference in the effective16 ness of alternative health care treatments in extend17 ing an individual’s life due to that individual’s age, 

18 disability, or terminal illness. 

19 ‘‘(3) Nothing in the provisions of, or amendments 

20 made by the Patient Protection and Affordable Care Act, 

21 shall be construed to limit comparative clinical effective22 ness research or any other research, evaluation, or dis23 semination of information concerning the likelihood that 

24 a health care treatment will result in disability. 


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1 ‘‘(e) The Patient-Centered Outcomes Research Insti2 tute established under section 1181(b)(1) shall not develop 

3 or employ a dollars-per-quality adjusted life year (or simi4 lar measure that discounts the value of a life because of 

5 an individual’s disability) as a threshold to establish what 

6 type of health care is cost effective or recommended. The 

7 Secretary shall not utilize such an adjusted life year (or 

8 such a similar measure) as a threshold to determine cov9 erage, reimbursement, or incentive programs under title 

10 XVIII.’’. 

11 (d) IN GENERAL.—Part D of title XI of the Social 

12 Security Act, as added by subsection (a) and amended by 

13 subsection (c), is amended by adding at the end the fol14 lowing new section: 

15 ‘‘TRUST FUND TRANSFERS TO PATIENT-CENTERED

16 OUTCOMES RESEARCH TRUST FUND

17 ‘‘SEC. 1183. (a) IN GENERAL.—The Secretary shall 

18 provide for the transfer, from the Federal Hospital Insur19 ance Trust Fund under section 1817 and the Federal Sup20 plementary Medical Insurance Trust Fund under section 

21 1841, in proportion (as estimated by the Secretary) to the 

22 total expenditures during such fiscal year that are made 

23 under title XVIII from the respective trust fund, to the 

24 Patient-Centered Outcomes Research Trust Fund (re25 ferred to in this section as the ‘PCORTF’) under section 


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1 9511 of the Internal Revenue Code of 1986, of the fol2 lowing: 

3 ‘‘(1) For fiscal year 2013, an amount equal to 

4 $1 multiplied by the average number of individuals 

5 entitled to benefits under part A, or enrolled under 

6 part B, of title XVIII during such fiscal year. 

7 ‘‘(2) For each of fiscal years 2014, 2015, 2016, 

8 2017, 2018, and 2019, an amount equal to $2 mul9 tiplied by the average number of individuals entitled 

10 to benefits under part A, or enrolled under part B, 

11 of title XVIII during such fiscal year. 

12 ‘‘(b) ADJUSTMENTS FOR INCREASES IN HEALTH

13 CARE SPENDING.—In the case of any fiscal year begin14 ning after September 30, 2014, the dollar amount in effect 

15 under subsection (a)(2) for such fiscal year shall be equal 

16 to the sum of such dollar amount for the previous fiscal 

17 year (determined after the application of this subsection), 

18 plus an amount equal to the product of— 

19 ‘‘(1) such dollar amount for the previous fiscal 

20 year, multiplied by 

21 ‘‘(2) the percentage increase in the projected 

22 per capita amount of National Health Expenditures, 

23 as most recently published by the Secretary before 

24 the beginning of the fiscal year.’’. 


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1 (e) PATIENT-CENTERED OUTCOMES RESEARCH

2 TRUST FUND; FINANCING FOR TRUST FUND.— 

3 (1) ESTABLISHMENT OF TRUST FUND.— 

4 (A) IN GENERAL.—Subchapter A of chap5 ter 98 of the Internal Revenue Code of 1986 

6 (relating to establishment of trust funds) is 

7 amended by adding at the end the following 

8 new section: 

9 ‘‘SEC. 9511. PATIENT-CENTERED OUTCOMES RESEARCH 

10 TRUST FUND. 

11 ‘‘(a) CREATION OF TRUST FUND.—There is estab12 lished in the Treasury of the United States a trust fund 

13 to be known as the ‘Patient-Centered Outcomes Research 

14 Trust Fund’ (hereafter in this section referred to as the 

15 ‘PCORTF’), consisting of such amounts as may be appro16 priated or credited to such Trust Fund as provided in this 

17 section and section 9602(b). 

18 ‘‘(b) TRANSFERS TO FUND.— 

19 ‘‘(1) APPROPRIATION.—There are hereby ap20 propriated to the Trust Fund the following: 

21 ‘‘(A) For fiscal year 2010, $10,000,000. 

22 ‘‘(B) For fiscal year 2011, $50,000,000. 

23 ‘‘(C) For fiscal year 2012, $150,000,000. 

24 ‘‘(D) For fiscal year 2013— 


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1 ‘‘(i) an amount equivalent to the net 

2 revenues received in the Treasury from the 

3 fees imposed under subchapter B of chap4 ter 34 (relating to fees on health insurance 

5 and self-insured plans) for such fiscal year; 

6 and 

7 ‘‘(ii) $150,000,000. 

8 ‘‘(E) For each of fiscal years 2014, 2015, 

9 2016, 2017, 2018, and 2019— 

10 ‘‘(i) an amount equivalent to the net 

11 revenues received in the Treasury from the 

12 fees imposed under subchapter B of chap13 ter 34 (relating to fees on health insurance 

14 and self-insured plans) for such fiscal year; 

15 and 

16 ‘‘(ii) $150,000,000. 

17 The amounts appropriated under subpara18 graphs (A), (B), (C), (D)(ii), and (E)(ii) shall 

19 be transferred from the general fund of the 

20 Treasury, from funds not otherwise appro21 priated. 

22 ‘‘(2) TRUST FUND TRANSFERS.—In addition to 

23 the amounts appropriated under paragraph (1), 

24 there shall be credited to the PCORTF the amounts 


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1 transferred under section 1183 of the Social Secu2 rity Act. 

3 ‘‘(3) LIMITATION ON TRANSFERS TO PCORTF.— 

4 No amount may be appropriated or transferred to 

5 the PCORTF on and after the date of any expendi6 ture from the PCORTF which is not an expenditure 

7 permitted under this section. The determination of 

8 whether an expenditure is so permitted shall be 

9 made without regard to— 

10 ‘‘(A) any provision of law which is not con11 tained or referenced in this chapter or in a rev12 enue Act, and 

13 ‘‘(B) whether such provision of law is a 

14 subsequently enacted provision or directly or in15 directly seeks to waive the application of this 

16 paragraph. 

17 ‘‘(c) TRUSTEE.—The Secretary of the Treasury shall 

18 be a trustee of the PCORTF. 

19 ‘‘(d) EXPENDITURES FROM FUND.— 

20 ‘‘(1) AMOUNTS AVAILABLE TO THE PATIENT21 CENTERED OUTCOMES RESEARCH INSTITUTE.—Sub22 ject to paragraph (2), amounts in the PCORTF are 

23 available, without further appropriation, to the Pa24 tient-Centered Outcomes Research Institute estab25 lished under section 1181(b) of the Social Security 


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1 Act for carrying out part D of title XI of the Social 

2 Security Act (as in effect on the date of enactment 

3 of such Act). 

4 ‘‘(2) TRANSFER OF FUNDS.— 

5 ‘‘(A) IN GENERAL.—The trustee of the 

6 PCORTF shall provide for the transfer from 

7 the PCORTF of 20 percent of the amounts ap8 propriated or credited to the PCORTF for each 

9 of fiscal years 2011 through 2019 to the Sec10 retary of Health and Human Services to carry 

11 out section 937 of the Public Health Service 

12 Act. 

13 ‘‘(B) AVAILABILITY.—Amounts transferred 

14 under subparagraph (A) shall remain available 

15 until expended. 

16 ‘‘(C) REQUIREMENTS.—Of the amounts 

17 transferred under subparagraph (A) with re18 spect to a fiscal year, the Secretary of Health 

19 and Human Services shall distribute— 

20 ‘‘(i) 80 percent to the Office of Com21 munication and Knowledge Transfer of the 

22 Agency for Healthcare Research and Qual23 ity (or any other relevant office designated 

24 by Agency for Healthcare Research and 

25 Quality) to carry out the activities deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01692 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 scribed in section 937 of the Public Health 

2 Service Act; and 

3 ‘‘(ii) 20 percent to the Secretary to 

4 carry out the activities described in such 

5 section 937. 

6 ‘‘(e) NET REVENUES.—For purposes of this section, 

7 the term ‘net revenues’ means the amount estimated by 

8 the Secretary of the Treasury based on the excess of— 

9 ‘‘(1) the fees received in the Treasury under 

10 subchapter B of chapter 34, over 

11 ‘‘(2) the decrease in the tax imposed by chapter 

12 1 resulting from the fees imposed by such sub13 chapter. 

14 ‘‘(f) TERMINATION.—No amounts shall be available 

15 for expenditure from the PCORTF after September 30, 

16 2019, and any amounts in such Trust Fund after such 

17 date shall be transferred to the general fund of the Treas18 ury.’’. 

19 (B) CLERICAL AMENDMENT.—The table of 

20 sections for subchapter A of chapter 98 of such 

21 Code is amended by adding at the end the fol22 lowing new item: 

‘‘Sec. 9511. Patient-centered outcomes research trust fund.’’. 

23 (2) FINANCING FOR FUND FROM FEES ON IN24 SURED AND SELF-INSURED HEALTH PLANS.— 


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1 (A) GENERAL RULE.—Chapter 34 of the 

2 Internal Revenue Code of 1986 is amended by 

3 adding at the end the following new subchapter: 

4 ‘‘Subchapter B—Insured and Self-Insured 

5 Health Plans 

‘‘Sec. 4375. Health insurance. 

‘‘Sec. 4376. Self-insured health plans. 

‘‘Sec. 4377. Definitions and special rules. 

6 ‘‘SEC. 4375. HEALTH INSURANCE. 

7 ‘‘(a) IMPOSITION OF FEE.—There is hereby imposed 

8 on each specified health insurance policy for each policy 

9 year ending after September 30, 2012, a fee equal to the 

10 product of $2 ($1 in the case of policy years ending during 

11 fiscal year 2013) multiplied by the average number of lives 

12 covered under the policy. 

13 ‘‘(b) LIABILITY FOR FEE.—The fee imposed by sub14 section (a) shall be paid by the issuer of the policy. 

15 ‘‘(c) SPECIFIED HEALTH INSURANCE POLICY.—For 

16 purposes of this section: 

17 ‘‘(1) IN GENERAL.—Except as otherwise pro18 vided in this section, the term ‘specified health in19 surance policy’ means any accident or health insur20 ance policy (including a policy under a group health 

21 plan) issued with respect to individuals residing in 

22 the United States. 

23 ‘‘(2) EXEMPTION FOR CERTAIN POLICIES.—The 

24 term ‘specified health insurance policy’ does not inVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01694 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 clude any insurance if substantially all of its cov2 erage is of excepted benefits described in section 

3 9832(c). 

4 ‘‘(3) TREATMENT OF PREPAID HEALTH COV5 ERAGE ARRANGEMENTS.— 

6 ‘‘(A) IN GENERAL.—In the case of any ar7 rangement described in subparagraph (B), such 

8 arrangement shall be treated as a specified 

9 health insurance policy, and the person referred 

10 to in such subparagraph shall be treated as the 

11 issuer. 

12 ‘‘(B) DESCRIPTION OF ARRANGEMENTS.— 

13 An arrangement is described in this subpara14 graph if under such arrangement fixed pay15 ments or premiums are received as consider16 ation for any person’s agreement to provide or 

17 arrange for the provision of accident or health 

18 coverage to residents of the United States, re19 gardless of how such coverage is provided or ar20 ranged to be provided. 

21 ‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH

22 CARE SPENDING.—In the case of any policy year ending 

23 in any fiscal year beginning after September 30, 2014, the 

24 dollar amount in effect under subsection (a) for such pol25 icy year shall be equal to the sum of such dollar amount 


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1 for policy years ending in the previous fiscal year (deter2 mined after the application of this subsection), plus an 

3 amount equal to the product of— 

4 ‘‘(1) such dollar amount for policy years ending 

5 in the previous fiscal year, multiplied by 

6 ‘‘(2) the percentage increase in the projected 

7 per capita amount of National Health Expenditures, 

8 as most recently published by the Secretary before 

9 the beginning of the fiscal year. 

10 ‘‘(e) TERMINATION.—This section shall not apply to 

11 policy years ending after September 30, 2019. 

12 ‘‘SEC. 4376. SELF-INSURED HEALTH PLANS. 

13 ‘‘(a) IMPOSITION OF FEE.—In the case of any appli14 cable self-insured health plan for each plan year ending 

15 after September 30, 2012, there is hereby imposed a fee 

16 equal to $2 ($1 in the case of plan years ending during 

17 fiscal year 2013) multiplied by the average number of lives 

18 covered under the plan. 

19 ‘‘(b) LIABILITY FOR FEE.— 

20 ‘‘(1) IN GENERAL.—The fee imposed by sub21 section (a) shall be paid by the plan sponsor. 

22 ‘‘(2) PLAN SPONSOR.—For purposes of para23 graph (1) the term ‘plan sponsor’ means— 

24 ‘‘(A) the employer in the case of a plan es25 tablished or maintained by a single employer, 


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1 ‘‘(B) the employee organization in the case 

2 of a plan established or maintained by an em3 ployee organization, 

4 ‘‘(C) in the case of— 

5 ‘‘(i) a plan established or maintained 

6 by 2 or more employers or jointly by 1 or 

7 more employers and 1 or more employee 

8 organizations, 

9 ‘‘(ii) a multiple employer welfare ar10 rangement, or 

11 ‘‘(iii) a voluntary employees’ bene12 ficiary association described in section 

13 501(c)(9),the association, committee, joint 

14 board of trustees, or other similar group of 

15 representatives of the parties who establish 

16 or maintain the plan, or 

17 ‘‘(D) the cooperative or association de18 scribed in subsection (c)(2)(F) in the case of a 

19 plan established or maintained by such a coop20 erative or association. 

21 ‘‘(c) APPLICABLE SELF-INSURED HEALTH PLAN.— 

22 For purposes of this section, the term ‘applicable self-in23 sured health plan’ means any plan for providing accident 

24 or health coverage if— 


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1 ‘‘(1) any portion of such coverage is provided 

2 other than through an insurance policy, and 

3 ‘‘(2) such plan is established or maintained— 

4 ‘‘(A) by 1 or more employers for the ben5 efit of their employees or former employees, 

6 ‘‘(B) by 1 or more employee organizations 

7 for the benefit of their members or former 

8 members, 

9 ‘‘(C) jointly by 1 or more employers and 1 

10 or more employee organizations for the benefit 

11 of employees or former employees, 

12 ‘‘(D) by a voluntary employees’ beneficiary 

13 association described in section 501(c)(9), 

14 ‘‘(E) by any organization described in sec15 tion 501(c)(6), or 

16 ‘‘(F) in the case of a plan not described in 

17 the preceding subparagraphs, by a multiple em18 ployer welfare arrangement (as defined in sec19 tion 3(40) of Employee Retirement Income Se20 curity Act of 1974), a rural electric cooperative 

21 (as defined in section 3(40)(B)(iv) of such Act), 

22 or a rural telephone cooperative association (as 

23 defined in section 3(40)(B)(v) of such Act). 

24 ‘‘(d) ADJUSTMENTS FOR INCREASES IN HEALTH

25 CARE SPENDING.—In the case of any plan year ending 


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1 in any fiscal year beginning after September 30, 2014, the 

2 dollar amount in effect under subsection (a) for such plan 

3 year shall be equal to the sum of such dollar amount for 

4 plan years ending in the previous fiscal year (determined 

5 after the application of this subsection), plus an amount 

6 equal to the product of— 

7 ‘‘(1) such dollar amount for plan years ending 

8 in the previous fiscal year, multiplied by 

9 ‘‘(2) the percentage increase in the projected 

10 per capita amount of National Health Expenditures, 

11 as most recently published by the Secretary before 

12 the beginning of the fiscal year. 

13 ‘‘(e) TERMINATION.—This section shall not apply to 

14 plan years ending after September 30, 2019. 

15 ‘‘SEC. 4377. DEFINITIONS AND SPECIAL RULES. 

16 ‘‘(a) DEFINITIONS.—For purposes of this sub17 chapter— 

18 ‘‘(1) ACCIDENT AND HEALTH COVERAGE.—The 

19 term ‘accident and health coverage’ means any cov20 erage which, if provided by an insurance policy, 

21 would cause such policy to be a specified health in22 surance policy (as defined in section 4375(c)). 

23 ‘‘(2) INSURANCE POLICY.—The term ‘insurance 

24 policy’ means any policy or other instrument whereVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01699 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 by a contract of insurance is issued, renewed, or ex2 tended. 

3 ‘‘(3) UNITED STATES.—The term ‘United 

4 States’ includes any possession of the United States. 

5 ‘‘(b) TREATMENT OF GOVERNMENTAL ENTITIES.— 

6 ‘‘(1) IN GENERAL.—For purposes of this sub7 chapter— 

8 ‘‘(A) the term ‘person’ includes any gov9 ernmental entity, and 

10 ‘‘(B) notwithstanding any other law or rule 

11 of law, governmental entities shall not be ex12 empt from the fees imposed by this subchapter 

13 except as provided in paragraph (2). 

14 ‘‘(2) TREATMENT OF EXEMPT GOVERNMENTAL

15 PROGRAMS.—In the case of an exempt governmental 

16 program, no fee shall be imposed under section 4375 

17 or section 4376 on any covered life under such pro18 gram. 

19 ‘‘(3) EXEMPT GOVERNMENTAL PROGRAM DE20 FINED.—For purposes of this subchapter, the term 

21 ‘exempt governmental program’ means— 

22 ‘‘(A) any insurance program established 

23 under title XVIII of the Social Security Act, 


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1 ‘‘(B) the medical assistance program es2 tablished by title XIX or XXI of the Social Se3 curity Act, 

4 ‘‘(C) any program established by Federal 

5 law for providing medical care (other than 

6 through insurance policies) to individuals (or 

7 the spouses and dependents thereof) by reason 

8 of such individuals being members of the 

9 Armed Forces of the United States or veterans, 

10 and 

11 ‘‘(D) any program established by Federal 

12 law for providing medical care (other than 

13 through insurance policies) to members of In14 dian tribes (as defined in section 4(d) of the In15 dian Health Care Improvement Act). 

16 ‘‘(c) TREATMENT AS TAX.—For purposes of subtitle 

17 F, the fees imposed by this subchapter shall be treated 

18 as if they were taxes. 

19 ‘‘(d) NO COVER OVER TO POSSESSIONS.—Notwith20 standing any other provision of law, no amount collected 

21 under this subchapter shall be covered over to any posses22 sion of the United States.’’. 

23 (B) CLERICAL AMENDMENTS.— 


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1 (i) Chapter 34 of such Code is amend2 ed by striking the chapter heading and in3 serting the following: 

4 ‘‘CHAPTER 34—TAXES ON CERTAIN 

5 INSURANCE POLICIES 

‘‘SUBCHAPTER A. POLICIES ISSUED BY FOREIGN INSURERS

‘‘SUBCHAPTER B. INSURED AND SELF-INSURED HEALTH PLANS

6 ‘‘Subchapter A—Policies Issued By Foreign 

7 Insurers’’. 

8 (ii) The table of chapters for subtitle 

9 D of such Code is amended by striking the 

10 item relating to chapter 34 and inserting 

11 the following new item: 

‘‘CHAPTER 34—TAXES ON CERTAIN INSURANCE POLICIES’’. 

12 (f) TAX-EXEMPT STATUS OF THE PATIENT-CEN13 TERED OUTCOMES RESEARCH INSTITUTE.—Subsection 

14 501(l) of the Internal Revenue Code of 1986 is amended 

15 by adding at the end the following new paragraph: 

16 ‘‘(4) The Patient-Centered Outcomes Research 

17 Institute established under section 1181(b) of the 

18 Social Security Act.’’. 

19 SEC. 6302. FEDERAL COORDINATING COUNCIL FOR COM20 PARATIVE EFFECTIVENESS RESEARCH. 

21 Notwithstanding any other provision of law, the Fed22 eral Coordinating Council for Comparative Effectiveness 

23 Research established under section 804 of Division A of 


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1 the American Recovery and Reinvestment Act of 2009 (42 

2 U.S.C. 299b–8), including the requirement under sub3 section (e)(2) of such section, shall terminate on the date 

4 of enactment of this Act. 

5 Subtitle E—Medicare, Medicaid, 

6 and CHIP Program Integrity 

7 Provisions 

8 SEC. 6401. PROVIDER SCREENING AND OTHER ENROLL9 MENT REQUIREMENTS UNDER MEDICARE, 

10 MEDICAID, AND CHIP. 

11 (a) MEDICARE.—Section 1866(j) of the Social Secu12 rity Act (42 U.S.C. 1395cc(j)) is amended— 

13 (1) in paragraph (1)(A), by adding at the end 

14 the following: ‘‘Such process shall include screening 

15 of providers and suppliers in accordance with para16 graph (2), a provisional period of enhanced oversight 

17 in accordance with paragraph (3), disclosure require18 ments in accordance with paragraph (4), the imposi19 tion of temporary enrollment moratoria in accord20 ance with paragraph (5), and the establishment of 

21 compliance programs in accordance with paragraph 

22 (6).’’; 

23 (2) by redesignating paragraph (2) as para24 graph (7); and 


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1 (3) by inserting after paragraph (1) the fol2 lowing: 

3 ‘‘(2) PROVIDER SCREENING.— 

4 ‘‘(A) PROCEDURES.—Not later than 180 

5 days after the date of enactment of this para6 graph, the Secretary, in consultation with the 

7 Inspector General of the Department of Health 

8 and Human Services, shall establish procedures 

9 under which screening is conducted with respect 

10 to providers of medical or other items or serv11 ices and suppliers under the program under this 

12 title, the Medicaid program under title XIX, 

13 and the CHIP program under title XXI. 

14 ‘‘(B) LEVEL OF SCREENING.—The Sec15 retary shall determine the level of screening 

16 conducted under this paragraph according to 

17 the risk of fraud, waste, and abuse, as deter18 mined by the Secretary, with respect to the cat19 egory of provider of medical or other items or 

20 services or supplier. Such screening— 

21 ‘‘(i) shall include a licensure check, 

22 which may include such checks across 

23 States; and 

24 ‘‘(ii) may, as the Secretary determines 

25 appropriate based on the risk of fraud, 


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1 waste, and abuse described in the pre2 ceding sentence, include— 

3 ‘‘(I) a criminal background 

4 check; 

5 ‘‘(II) fingerprinting; 

6 ‘‘(III) unscheduled and unan7 nounced site visits, including 

8 preenrollment site visits; 

9 ‘‘(IV) database checks (including 

10 such checks across States); and 

11 ‘‘(V) such other screening as the 

12 Secretary determines appropriate. 

13 ‘‘(C) APPLICATION FEES.— 

14 ‘‘(i) INDIVIDUAL PROVIDERS.—Except 

15 as provided in clause (iii), the Secretary 

16 shall impose a fee on each individual pro17 vider of medical or other items or services 

18 or supplier (such as a physician, physician 

19 assistant, nurse practitioner, or clinical 

20 nurse specialist) with respect to which 

21 screening is conducted under this para22 graph in an amount equal to— 

23 ‘‘(I) for 2010, $200; and 

24 ‘‘(II) for 2011 and each subse25 quent year, the amount determined 


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1 under this clause for the preceding 

2 year, adjusted by the percentage 

3 change in the consumer price index 

4 for all urban consumers (all items; 

5 United States city average) for the 

6 12-month period ending with June of 

7 the previous year. 

8 ‘‘(ii) INSTITUTIONAL PROVIDERS.— 

9 Except as provided in clause (iii), the Sec10 retary shall impose a fee on each institu11 tional provider of medical or other items or 

12 services or supplier (such as a hospital or 

13 skilled nursing facility) with respect to 

14 which screening is conducted under this 

15 paragraph in an amount equal to— 

16 ‘‘(I) for 2010, $500; and 

17 ‘‘(II) for 2011 and each subse18 quent year, the amount determined 

19 under this clause for the preceding 

20 year, adjusted by the percentage 

21 change in the consumer price index 

22 for all urban consumers (all items; 

23 United States city average) for the 

24 12-month period ending with June of 

25 the previous year. 


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1 ‘‘(iii) HARDSHIP EXCEPTION; WAIVER

2 FOR CERTAIN MEDICAID PROVIDERS.—The 

3 Secretary may, on a case-by-case basis, ex4 empt a provider of medical or other items 

5 or services or supplier from the imposition 

6 of an application fee under this subpara7 graph if the Secretary determines that the 

8 imposition of the application fee would re9 sult in a hardship. The Secretary may 

10 waive the application fee under this sub11 paragraph for providers enrolled in a State 

12 Medicaid program for whom the State 

13 demonstrates that imposition of the fee 

14 would impede beneficiary access to care. 

15 ‘‘(iv) USE OF FUNDS.—Amounts col16 lected as a result of the imposition of a fee 

17 under this subparagraph shall be used by 

18 the Secretary for program integrity efforts, 

19 including to cover the costs of conducting 

20 screening under this paragraph and to 

21 carry out this subsection and section 

22 1128J. 

23 ‘‘(D) APPLICATION AND ENFORCEMENT.— 

24 ‘‘(i) NEW PROVIDERS OF SERVICES

25 AND SUPPLIERS.—The screening under 


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1 this paragraph shall apply, in the case of 

2 a provider of medical or other items or 

3 services or supplier who is not enrolled in 

4 the program under this title, title XIX , or 

5 title XXI as of the date of enactment of 

6 this paragraph, on or after the date that is 

7 1 year after such date of enactment. 

8 ‘‘(ii) CURRENT PROVIDERS OF SERV9 ICES AND SUPPLIERS.—The screening 

10 under this paragraph shall apply, in the 

11 case of a provider of medical or other 

12 items or services or supplier who is en13 rolled in the program under this title, title 

14 XIX, or title XXI as of such date of enact15 ment, on or after the date that is 2 years 

16 after such date of enactment. 

17 ‘‘(iii) REVALIDATION OF ENROLL18 MENT.—Effective beginning on the date 

19 that is 180 days after such date of enact20 ment, the screening under this paragraph 

21 shall apply with respect to the revalidation 

22 of enrollment of a provider of medical or 

23 other items or services or supplier in the 

24 program under this title, title XIX, or title 

25 XXI. 


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1 ‘‘(iv) LIMITATION ON ENROLLMENT

2 AND REVALIDATION OF ENROLLMENT.—In 

3 no case may a provider of medical or other 

4 items or services or supplier who has not 

5 been screened under this paragraph be ini6 tially enrolled or reenrolled in the program 

7 under this title, title XIX, or title XXI on 

8 or after the date that is 3 years after such 

9 date of enactment. 

10 ‘‘(E) EXPEDITED RULEMAKING.—The Sec11 retary may promulgate an interim final rule to 

12 carry out this paragraph. 

13 ‘‘(3) PROVISIONAL PERIOD OF ENHANCED

14 OVERSIGHT FOR NEW PROVIDERS OF SERVICES AND

15 SUPPLIERS.— 

16 ‘‘(A) IN GENERAL.—The Secretary shall 

17 establish procedures to provide for a provisional 

18 period of not less than 30 days and not more 

19 than 1 year during which new providers of med20 ical or other items or services and suppliers, as 

21 the Secretary determines appropriate, including 

22 categories of providers or suppliers, would be 

23 subject to enhanced oversight, such as prepay24 ment review and payment caps, under the pro25 gram under this title, the Medicaid program 


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1 under title XIX. and the CHIP program under 

2 title XXI. 

3 ‘‘(B) IMPLEMENTATION.—The Secretary 

4 may establish by program instruction or other5 wise the procedures under this paragraph. 

6 ‘‘(4) INCREASED DISCLOSURE REQUIRE7 MENTS.— 

8 ‘‘(A) DISCLOSURE.—A provider of medical 

9 or other items or services or supplier who sub10 mits an application for enrollment or revalida11 tion of enrollment in the program under this 

12 title , title XIX, or title XXI on or after the 

13 date that is 1 year after the date of enactment 

14 of this paragraph shall disclose (in a form and 

15 manner and at such time as determined by the 

16 Secretary) any current or previous affiliation 

17 (directly or indirectly) with a provider of med18 ical or other items or services or supplier that 

19 has uncollected debt, has been or is subject to 

20 a payment suspension under a Federal health 

21 care program (as defined in section 1128B(f)), 

22 has been excluded from participation under the 

23 program under this title, the Medicaid program 

24 under title XIX, or the CHIP program under 


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1 title XXI, or has had its billing privileges de2 nied or revoked. 

3 ‘‘(B) AUTHORITY TO DENY ENROLL4 MENT.—If the Secretary determines that such 

5 previous affiliation poses an undue risk of 

6 fraud, waste, or abuse, the Secretary may deny 

7 such application. Such a denial shall be subject 

8 to appeal in accordance with paragraph (7). 

9 ‘‘(5) AUTHORITY TO ADJUST PAYMENTS OF

10 PROVIDERS OF SERVICES AND SUPPLIERS WITH THE

11 SAME TAX IDENTIFICATION NUMBER FOR PAST-DUE

12 OBLIGATIONS.— 

13 ‘‘(A) IN GENERAL.—Notwithstanding any 

14 other provision of this title, in the case of an 

15 applicable provider of services or supplier, the 

16 Secretary may make any necessary adjustments 

17 to payments to the applicable provider of serv18 ices or supplier under the program under this 

19 title in order to satisfy any past-due obligations 

20 described in subparagraph (B)(ii) of an obli21 gated provider of services or supplier. 

22 ‘‘(B) DEFINITIONS.—In this paragraph: 

23 ‘‘(i) IN GENERAL.—The term ‘applica24 ble provider of services or supplier’ means 

25 a provider of services or supplier that has 


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1 the same taxpayer identification number 

2 assigned under section 6109 of the Inter3 nal Revenue Code of 1986 as is assigned 

4 to the obligated provider of services or sup5 plier under such section, regardless of 

6 whether the applicable provider of services 

7 or supplier is assigned a different billing 

8 number or national provider identification 

9 number under the program under this title 

10 than is assigned to the obligated provider 

11 of services or supplier. 

12 ‘‘(ii) OBLIGATED PROVIDER OF SERV13 ICES OR SUPPLIER.—The term ‘obligated 

14 provider of services or supplier’ means a 

15 provider of services or supplier that owes a 

16 past-due obligation under the program 

17 under this title (as determined by the Sec18 retary). 

19 ‘‘(6) TEMPORARY MORATORIUM ON ENROLL20 MENT OF NEW PROVIDERS.— 

21 ‘‘(A) IN GENERAL.—The Secretary may 

22 impose a temporary moratorium on the enroll23 ment of new providers of services and suppliers, 

24 including categories of providers of services and 

25 suppliers, in the program under this title, under 


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1 the Medicaid program under title XIX, or 

2 under the CHIP program under title XXI if the 

3 Secretary determines such moratorium is nec4 essary to prevent or combat fraud, waste, or 

5 abuse under either such program. 

6 ‘‘(B) LIMITATION ON REVIEW.—There 

7 shall be no judicial review under section 1869, 

8 section 1878, or otherwise, of a temporary mor9 atorium imposed under subparagraph (A). 

10 ‘‘(7) COMPLIANCE PROGRAMS.— 

11 ‘‘(A) IN GENERAL.—On or after the date 

12 of implementation determined by the Secretary 

13 under subparagraph (C), a provider of medical 

14 or other items or services or supplier within a 

15 particular industry sector or category shall, as 

16 a condition of enrollment in the program under 

17 this title, title XIX, or title XXI, establish a 

18 compliance program that contains the core ele19 ments established under subparagraph (B) with 

20 respect to that provider or supplier and indus21 try or category. 

22 ‘‘(B) ESTABLISHMENT OF CORE ELE23 MENTS.—The Secretary, in consultation with 

24 the Inspector General of the Department of 

25 Health and Human Services, shall establish 


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1 core elements for a compliance program under 

2 subparagraph (A) for providers or suppliers 

3 within a particular industry or category. 

4 ‘‘(C) TIMELINE FOR IMPLEMENTATION.— 

5 The Secretary shall determine the timeline for 

6 the establishment of the core elements under 

7 subparagraph (B) and the date of the imple8 mentation of subparagraph (A) for providers or 

9 suppliers within a particular industry or cat10 egory. The Secretary shall, in determining such 

11 date of implementation, consider the extent to 

12 which the adoption of compliance programs by 

13 a provider of medical or other items or services 

14 or supplier is widespread in a particular indus15 try sector or with respect to a particular pro16 vider or supplier category.’’. 

17 (b) MEDICAID.— 

18 (1) STATE PLAN AMENDMENT.—Section 

19 1902(a) of the Social Security Act (42 U.S.C. 

20 1396a(a)), as amended by section 4302(b), is 

21 amended— 

22 (A) in subsection (a)— 

23 (i) by striking ‘‘and’’ at the end of 

24 paragraph (75); 


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1 (ii) by striking the period at the end 

2 of paragraph (76) and inserting a semi3 colon; and 

4 (iii) by inserting after paragraph (76) 

5 the following: 

6 ‘‘(77) provide that the State shall comply with 

7 provider and supplier screening, oversight, and re8 porting requirements in accordance with subsection 

9 (ii);’’; and 

10 (B) by adding at the end the following: 

11 ‘‘(ii) PROVIDER AND SUPPLIER SCREENING, OVER12 SIGHT, AND REPORTING REQUIREMENTS.—For purposes 

13 of subsection (a)(77), the requirements of this subsection 

14 are the following: 

15 ‘‘(1) SCREENING.—The State complies with the 

16 process for screening providers and suppliers under 

17 this title, as established by the Secretary under sec18 tion 1886(j)(2). 

19 ‘‘(2) PROVISIONAL PERIOD OF ENHANCED

20 OVERSIGHT FOR NEW PROVIDERS AND SUPPLIERS.— 

21 The State complies with procedures to provide for a 

22 provisional period of enhanced oversight for new pro23 viders and suppliers under this title, as established 

24 by the Secretary under section 1886(j)(3). 


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1 ‘‘(3) DISCLOSURE REQUIREMENTS.—The State 

2 requires providers and suppliers under the State 

3 plan or under a waiver of the plan to comply with 

4 the disclosure requirements established by the Sec5 retary under section 1886(j)(4). 

6 ‘‘(4) TEMPORARY MORATORIUM ON ENROLL7 MENT OF NEW PROVIDERS OR SUPPLIERS.— 

8 ‘‘(A) TEMPORARY MORATORIUM IMPOSED

9 BY THE SECRETARY.— 

10 ‘‘(i) IN GENERAL.—Subject to clause 

11 (ii), the State complies with any temporary 

12 moratorium on the enrollment of new pro13 viders or suppliers imposed by the Sec14 retary under section 1886(j)(6). 

15 ‘‘(ii) EXCEPTION.—A State shall not 

16 be required to comply with a temporary 

17 moratorium described in clause (i) if the 

18 State determines that the imposition of 

19 such temporary moratorium would ad20 versely impact beneficiaries’ access to med21 ical assistance. 

22 ‘‘(B) MORATORIUM ON ENROLLMENT OF

23 PROVIDERS AND SUPPLIERS.—At the option of 

24 the State, the State imposes, for purposes of 

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1 viders or suppliers under the State plan or 

2 under a waiver of the plan, periods of enroll3 ment moratoria, or numerical caps or other lim4 its, for providers or suppliers identified by the 

5 Secretary as being at high-risk for fraud, waste, 

6 or abuse as necessary to combat fraud, waste, 

7 or abuse, but only if the State determines that 

8 the imposition of any such period, cap, or other 

9 limits would not adversely impact beneficiaries’ 

10 access to medical assistance. 

11 ‘‘(5) COMPLIANCE PROGRAMS.—The State re12 quires providers and suppliers under the State plan 

13 or under a waiver of the plan to establish, in accord14 ance with the requirements of section 1866(j)(7), a 

15 compliance program that contains the core elements 

16 established under subparagraph (B) of that section 

17 1866(j)(7) for providers or suppliers within a par18 ticular industry or category. 

19 ‘‘(6) REPORTING OF ADVERSE PROVIDER AC20 TIONS.—The State complies with the national sys21 tem for reporting criminal and civil convictions, 

22 sanctions, negative licensure actions, and other ad23 verse provider actions to the Secretary, through the 

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1 icaid Services, in accordance with regulations of the 

2 Secretary. 

3 ‘‘(7) ENROLLMENT AND NPI OF ORDERING OR

4 REFERRING PROVIDERS.—The State requires— 

5 ‘‘(A) all ordering or referring physicians or 

6 other professionals to be enrolled under the 

7 State plan or under a waiver of the plan as a 

8 participating provider; and 

9 ‘‘(B) the national provider identifier of any 

10 ordering or referring physician or other profes11 sional to be specified on any claim for payment 

12 that is based on an order or referral of the phy13 sician or other professional. 

14 ‘‘(8) OTHER STATE OVERSIGHT.—Nothing in 

15 this subsection shall be interpreted to preclude or 

16 limit the ability of a State to engage in provider and 

17 supplier screening or enhanced provider and supplier 

18 oversight activities beyond those required by the Sec19 retary.’’. 

20 (2) DISCLOSURE OF MEDICARE TERMINATED

21 PROVIDERS AND SUPPLIERS TO STATES.—The Ad22 ministrator of the Centers for Medicare & Medicaid 

23 Services shall establish a process for making avail24 able to the each State agency with responsibility for 

25 administering a State Medicaid plan (or a waiver of 


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1 such plan) under title XIX of the Social Security 

2 Act or a child health plan under title XXI the name, 

3 national provider identifier, and other identifying in4 formation for any provider of medical or other items 

5 or services or supplier under the Medicare program 

6 under title XVIII or under the CHIP program under 

7 title XXI that is terminated from participation 

8 under that program within 30 days of the termi9 nation (and, with respect to all such providers or 

10 suppliers who are terminated from the Medicare pro11 gram on the date of enactment of this Act, within 

12 90 days of such date). 

13 (3) CONFORMING AMENDMENT.—Section 

14 1902(a)(23) of the Social Security Act (42 U.S.C. 

15 1396a), is amended by inserting before the semi16 colon at the end the following: ‘‘or by a provider or 

17 supplier to which a moratorium under subsection 

18 (ii)(4) is applied during the period of such morato19 rium’’. 

20 (c) CHIP.—Section 2107(e)(1) of the Social Security 

21 Act (42 U.S.C. 1397gg(e)(1)), as amended by section 

22 2101(d), is amended— 

23 (1) by redesignating subparagraphs (D) 

24 through (M) as subparagraphs (E) through (N), re25 spectively; and 


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1 (2) by inserting after subparagraph (C), the fol2 lowing: 

3 ‘‘(D) Subsections (a)(77) and (ii) of sec4 tion 1902 (relating to provider and supplier 

5 screening, oversight, and reporting require6 ments).’’. 

7 SEC. 6402. ENHANCED MEDICARE AND MEDICAID PRO8 GRAM INTEGRITY PROVISIONS. 

9 (a) IN GENERAL.—Part A of title XI of the Social 

10 Security Act (42 U.S.C. 1301 et seq.), as amended by sec11 tions 6002, 6004, and 6102, is amended by inserting after 

12 section 1128I the following new section: 

13 ‘‘SEC. 1128J. MEDICARE AND MEDICAID PROGRAM INTEG14 RITY PROVISIONS. 

15 ‘‘(a) DATA MATCHING.— 

16 ‘‘(1) INTEGRATED DATA REPOSITORY.— 

17 ‘‘(A) INCLUSION OF CERTAIN DATA.— 

18 ‘‘(i) IN GENERAL.—The Integrated 

19 Data Repository of the Centers for Medi20 care & Medicaid Services shall include, at 

21 a minimum, claims and payment data from 

22 the following: 

23 ‘‘(I) The programs under titles 

24 XVIII and XIX (including parts A, B, 

25 C, and D of title XVIII). 


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1 ‘‘(II) The program under title 

2 XXI. 

3 ‘‘(III) Health-related programs 

4 administered by the Secretary of Vet5 erans Affairs. 

6 ‘‘(IV) Health-related programs 

7 administered by the Secretary of De8 fense. 

9 ‘‘(V) The program of old-age, 

10 survivors, and disability insurance 

11 benefits established under title II. 

12 ‘‘(VI) The Indian Health Service 

13 and the Contract Health Service pro14 gram. 

15 ‘‘(ii) PRIORITY FOR INCLUSION OF

16 CERTAIN DATA.—Inclusion of the data de17 scribed in subclause (I) of such clause in 

18 the Integrated Data Repository shall be a 

19 priority. Data described in subclauses (II) 

20 through (VI) of such clause shall be in21 cluded in the Integrated Data Repository 

22 as appropriate. 

23 ‘‘(B) DATA SHARING AND MATCHING.— 

24 ‘‘(i) IN GENERAL.—The Secretary 

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1 viduals described in clause (ii) under which 

2 such individuals share and match data in 

3 the system of records of the respective 

4 agencies of such individuals with data in 

5 the system of records of the Department of 

6 Health and Human Services for the pur7 pose of identifying potential fraud, waste, 

8 and abuse under the programs under titles 

9 XVIII and XIX. 

10 ‘‘(ii) INDIVIDUALS DESCRIBED.—The 

11 following individuals are described in this 

12 clause: 

13 ‘‘(I) The Commissioner of Social 

14 Security. 

15 ‘‘(II) The Secretary of Veterans 

16 Affairs. 

17 ‘‘(III) The Secretary of Defense. 

18 ‘‘(IV) The Director of the Indian 

19 Health Service. 

20 ‘‘(iii) DEFINITION OF SYSTEM OF

21 RECORDS.—For purposes of this para22 graph, the term ‘system of records’ has the 

23 meaning given such term in section 

24 552a(a)(5) of title 5, United States Code. 


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1 ‘‘(2) ACCESS TO CLAIMS AND PAYMENT DATA2 BASES.—For purposes of conducting law enforce3 ment and oversight activities and to the extent con4 sistent with applicable information, privacy, security, 

5 and disclosure laws, including the regulations pro6 mulgated under the Health Insurance Portability 

7 and Accountability Act of 1996 and section 552a of 

8 title 5, United States Code, and subject to any infor9 mation systems security requirements under such 

10 laws or otherwise required by the Secretary, the In11 spector General of the Department of Health and 

12 Human Services and the Attorney General shall 

13 have access to claims and payment data of the De14 partment of Health and Human Services and its 

15 contractors related to titles XVIII, XIX, and XXI. 

16 ‘‘(b) OIG AUTHORITY TO OBTAIN INFORMATION.— 

17 ‘‘(1) IN GENERAL.—Notwithstanding and in ad18 dition to any other provision of law, the Inspector 

19 General of the Department of Health and Human 

20 Services may, for purposes of protecting the integ21 rity of the programs under titles XVIII and XIX, 

22 obtain information from any individual (including a 

23 beneficiary provided all applicable privacy protec24 tions are followed) or entity that— 


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1 ‘‘(A) is a provider of medical or other 

2 items or services, supplier, grant recipient, con3 tractor, or subcontractor; or 

4 ‘‘(B) directly or indirectly provides, orders, 

5 manufactures, distributes, arranges for, pre6 scribes, supplies, or receives medical or other 

7 items or services payable by any Federal health 

8 care program (as defined in section 1128B(f)) 

9 regardless of how the item or service is paid 

10 for, or to whom such payment is made. 

11 ‘‘(2) INCLUSION OF CERTAIN INFORMATION.— 

12 Information which the Inspector General may obtain 

13 under paragraph (1) includes any supporting docu14 mentation necessary to validate claims for payment 

15 or payments under title XVIII or XIX, including a 

16 prescribing physician’s medical records for an indi17 vidual who is prescribed an item or service which is 

18 covered under part B of title XVIII, a covered part 

19 D drug (as defined in section 1860D–2(e)) for which 

20 payment is made under an MA–PD plan under part 

21 C of such title, or a prescription drug plan under 

22 part D of such title, and any records necessary for 

23 evaluation of the economy, efficiency, and effective24 ness of the programs under titles XVIII and XIX. 


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1 ‘‘(c) ADMINISTRATIVE REMEDY FOR KNOWING PAR2 TICIPATION BY BENEFICIARY IN HEALTH CARE FRAUD

3 SCHEME.— 

4 ‘‘(1) IN GENERAL.—In addition to any other 

5 applicable remedies, if an applicable individual has 

6 knowingly participated in a Federal health care 

7 fraud offense or a conspiracy to commit a Federal 

8 health care fraud offense, the Secretary shall impose 

9 an appropriate administrative penalty commensurate 

10 with the offense or conspiracy. 

11 ‘‘(2) APPLICABLE INDIVIDUAL.—For purposes 

12 of paragraph (1), the term ‘applicable individual’ 

13 means an individual— 

14 ‘‘(A) entitled to, or enrolled for, benefits 

15 under part A of title XVIII or enrolled under 

16 part B of such title; 

17 ‘‘(B) eligible for medical assistance under 

18 a State plan under title XIX or under a waiver 

19 of such plan; or 

20 ‘‘(C) eligible for child health assistance 

21 under a child health plan under title XXI. 

22 ‘‘(d) REPORTING AND RETURNING OF OVERPAY23 MENTS.— 

24 ‘‘(1) IN GENERAL.—If a person has received an 

25 overpayment, the person shall— 


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•AMDT. NO. 2786 

1 ‘‘(A) report and return the overpayment to 

2 the Secretary, the State, an intermediary, a 

3 carrier, or a contractor, as appropriate, at the 

4 correct address; and 

5 ‘‘(B) notify the Secretary, State, inter6 mediary, carrier, or contractor to whom the 

7 overpayment was returned in writing of the rea8 son for the overpayment. 

9 ‘‘(2) DEADLINE FOR REPORTING AND RETURN10 ING OVERPAYMENTS.—An overpayment must be re11 ported and returned under paragraph (1) by the 

12 later of— 

13 ‘‘(A) the date which is 60 days after the 

14 date on which the overpayment was identified; 

15 or 

16 ‘‘(B) the date any corresponding cost re17 port is due, if applicable. 

18 ‘‘(3) ENFORCEMENT.—Any overpayment re19 tained by a person after the deadline for reporting 

20 and returning the overpayment under paragraph (2) 

21 is an obligation (as defined in section 3729(b)(3) of 

22 title 31, United States Code) for purposes of section 

23 3729 of such title. 

24 ‘‘(4) DEFINITIONS.—In this subsection: 


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1 ‘‘(A) KNOWING AND KNOWINGLY.—The 

2 terms ‘knowing’ and ‘knowingly’ have the mean3 ing given those terms in section 3729(b) of title 

4 31, United States Code. 

5 ‘‘(B) OVERPAYMENT.—The term ‘‘overpay6 ment’’ means any funds that a person receives 

7 or retains under title XVIII or XIX to which 

8 the person, after applicable reconciliation, is not 

9 entitled under such title. 

10 ‘‘(C) PERSON.— 

11 ‘‘(i) IN GENERAL.—The term ‘person’ 

12 means a provider of services, supplier, 

13 medicaid managed care organization (as 

14 defined in section 1903(m)(1)(A)), Medi15 care Advantage organization (as defined in 

16 section 1859(a)(1)), or PDP sponsor (as 

17 defined in section 1860D–41(a)(13)). 

18 ‘‘(ii) EXCLUSION.—Such term does 

19 not include a beneficiary. 

20 ‘‘(e) INCLUSION OF NATIONAL PROVIDER IDENTI21 FIER ON ALL APPLICATIONS AND CLAIMS.—The Sec22 retary shall promulgate a regulation that requires, not 

23 later than January 1, 2011, all providers of medical or 

24 other items or services and suppliers under the programs 

25 under titles XVIII and XIX that qualify for a national 


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1 provider identifier to include their national provider identi2 fier on all applications to enroll in such programs and on 

3 all claims for payment submitted under such programs.’’. 

4 (b) ACCESS TO DATA.— 

5 (1) MEDICARE PART D.—Section 1860D– 

6 15(f)(2) of the Social Security Act (42 U.S.C. 

7 1395w–116(f)(2)) is amended by striking ‘‘may be 

8 used by’’ and all that follows through the period at 

9 the end and inserting ‘‘may be used— 

10 ‘‘(A) by officers, employees, and contrac11 tors of the Department of Health and Human 

12 Services for the purposes of, and to the extent 

13 necessary in— 

14 ‘‘(i) carrying out this section; and 

15 ‘‘(ii) conducting oversight, evaluation, 

16 and enforcement under this title; and 

17 ‘‘(B) by the Attorney General and the 

18 Comptroller General of the United States for 

19 the purposes of, and to the extent necessary in, 

20 carrying out health oversight activities.’’. 

21 (2) DATA MATCHING.—Section 552a(a)(8)(B) 

22 of title 5, United States Code, is amended— 

23 (A) in clause (vii), by striking ‘‘or’’ at the 

24 end; 


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•AMDT. NO. 2786 

1 (B) in clause (viii), by inserting ‘‘or’’ after 

2 the semicolon; and 

3 (C) by adding at the end the following new 

4 clause: 

5 ‘‘(ix) matches performed by the Sec6 retary of Health and Human Services or 

7 the Inspector General of the Department 

8 of Health and Human Services with re9 spect to potential fraud, waste, and abuse, 

10 including matches of a system of records 

11 with non-Federal records;’’. 

12 (3) MATCHING AGREEMENTS WITH THE COM13 MISSIONER OF SOCIAL SECURITY.—Section 205(r) of 

14 the Social Security Act (42 U.S.C. 405(r)) is amend15 ed by adding at the end the following new para16 graph: 

17 ‘‘(9)(A) The Commissioner of Social Security 

18 shall, upon the request of the Secretary or the In19 spector General of the Department of Health and 

20 Human Services— 

21 ‘‘(i) enter into an agreement with the Sec22 retary or such Inspector General for the pur23 pose of matching data in the system of records 

24 of the Social Security Administration and the 


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1 system of records of the Department of Health 

2 and Human Services; and 

3 ‘‘(ii) include in such agreement safeguards 

4 to assure the maintenance of the confidentiality 

5 of any information disclosed. 

6 ‘‘(B) For purposes of this paragraph, the term 

7 ‘system of records’ has the meaning given such term 

8 in section 552a(a)(5) of title 5, United States 

9 Code.’’. 

10 (c) WITHHOLDING OF FEDERAL MATCHING PAY11 MENTS FOR STATES THAT FAIL TO REPORT ENROLLEE

12 ENCOUNTER DATA IN THE MEDICAID STATISTICAL IN13 FORMATION SYSTEM.—Section 1903(i) of the Social Secu14 rity Act (42 U.S.C. 1396b(i)) is amended— 

15 (1) in paragraph (23), by striking ‘‘or’’ at the 

16 end; 

17 (2) in paragraph (24), by striking the period at 

18 the end and inserting ‘‘; or’’; and 

19 (3) by adding at the end the following new 

20 paragraph:. 

21 ‘‘(25) with respect to any amounts expended for 

22 medical assistance for individuals for whom the 

23 State does not report enrollee encounter data (as de24 fined by the Secretary) to the Medicaid Statistical 


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1 Information System (MSIS) in a timely manner (as 

2 determined by the Secretary).’’. 

3 (d) PERMISSIVE EXCLUSIONS AND CIVIL MONETARY

4 PENALTIES.— 

5 (1) PERMISSIVE EXCLUSIONS.—Section 1128(b) 

6 of the Social Security Act (42 U.S.C. 1320a–7(b)) 

7 is amended by adding at the end the following new 

8 paragraph: 

9 ‘‘(16) MAKING FALSE STATEMENTS OR MIS10 REPRESENTATION OF MATERIAL FACTS.—Any indi11 vidual or entity that knowingly makes or causes to 

12 be made any false statement, omission, or misrepre13 sentation of a material fact in any application, 

14 agreement, bid, or contract to participate or enroll 

15 as a provider of services or supplier under a Federal 

16 health care program (as defined in section 

17 1128B(f)), including Medicare Advantage organiza18 tions under part C of title XVIII, prescription drug 

19 plan sponsors under part D of title XVIII, medicaid 

20 managed care organizations under title XIX, and en21 tities that apply to participate as providers of serv22 ices or suppliers in such managed care organizations 

23 and such plans.’’. 

24 (2) CIVIL MONETARY PENALTIES.— 


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•AMDT. NO. 2786 

1 (A) IN GENERAL.—Section 1128A(a) of 

2 the Social Security Act (42 U.S.C. 1320a– 

3 7a(a)) is amended— 

4 (i) in paragraph (1)(D), by striking 

5 ‘‘was excluded’’ and all that follows 

6 through the period at the end and insert7 ing ‘‘was excluded from the Federal health 

8 care program (as defined in section 

9 1128B(f)) under which the claim was 

10 made pursuant to Federal law.’’; 

11 (ii) in paragraph (6), by striking ‘‘or’’ 

12 at the end; 

13 (iii) by inserting after paragraph (7), 

14 the following new paragraphs: 

15 ‘‘(8) orders or prescribes a medical or other 

16 item or service during a period in which the person 

17 was excluded from a Federal health care program 

18 (as so defined), in the case where the person knows 

19 or should know that a claim for such medical or 

20 other item or service will be made under such a pro21 gram; 

22 ‘‘(9) knowingly makes or causes to be made any 

23 false statement, omission, or misrepresentation of a 

24 material fact in any application, bid, or contract to 

25 participate or enroll as a provider of services or a 


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1 supplier under a Federal health care program (as so 

2 defined), including Medicare Advantage organiza3 tions under part C of title XVIII, prescription drug 

4 plan sponsors under part D of title XVIII, medicaid 

5 managed care organizations under title XIX, and en6 tities that apply to participate as providers of serv7 ices or suppliers in such managed care organizations 

8 and such plans; 

9 ‘‘(10) knows of an overpayment (as defined in 

10 paragraph (4) of section 1128J(d)) and does not re11 port and return the overpayment in accordance with 

12 such section;’’; 

13 (iv) in the first sentence— 

14 (I) by striking the ‘‘or’’ after 

15 ‘‘prohibited relationship occurs;’’; and 

16 (II) by striking ‘‘act)’’ and in17 serting ‘‘act; or in cases under para18 graph (9), $50,000 for each false 

19 statement or misrepresentation of a 

20 material fact)’’; and 

21 (v) in the second sentence, by striking 

22 ‘‘purpose)’’ and inserting ‘‘purpose; or in 

23 cases under paragraph (9), an assessment 

24 of not more than 3 times the total amount 

25 claimed for each item or service for which 


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1 payment was made based upon the applica2 tion containing the false statement or mis3 representation of a material fact)’’. 

4 (B) CLARIFICATION OF TREATMENT OF

5 CERTAIN CHARITABLE AND OTHER INNOCUOUS

6 PROGRAMS.—Section 1128A(i)(6) of the Social 

7 Security Act (42 U.S.C. 1320a–7a(i)(6)) is 

8 amended— 

9 (i) in subparagraph (C), by striking 

10 ‘‘or’’ at the end; 

11 (ii) in subparagraph (D), as redesig12 nated by section 4331(e) of the Balanced 

13 Budget Act of 1997 (Public Law 105–33), 

14 by striking the period at the end and in15 serting a semicolon; 

16 (iii) by redesignating subparagraph 

17 (D), as added by section 4523(c) of such 

18 Act, as subparagraph (E) and striking the 

19 period at the end and inserting ‘‘; or’’; and 

20 (iv) by adding at the end the following 

21 new subparagraphs: 

22 ‘‘(F) any other remuneration which pro23 motes access to care and poses a low risk of 

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1 grams (as defined in section 1128B(f) and des2 ignated by the Secretary under regulations); 

3 ‘‘(G) the offer or transfer of items or serv4 ices for free or less than fair market value by 

5 a person, if— 

6 ‘‘(i) the items or services consist of 

7 coupons, rebates, or other rewards from a 

8 retailer; 

9 ‘‘(ii) the items or services are offered 

10 or transferred on equal terms available to 

11 the general public, regardless of health in12 surance status; and 

13 ‘‘(iii) the offer or transfer of the items 

14 or services is not tied to the provision of 

15 other items or services reimbursed in whole 

16 or in part by the program under title 

17 XVIII or a State health care program (as 

18 defined in section 1128(h)); 

19 ‘‘(H) the offer or transfer of items or serv20 ices for free or less than fair market value by 

21 a person, if— 

22 ‘‘(i) the items or services are not of23 fered as part of any advertisement or solic24 itation; 


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1 ‘‘(ii) the items or services are not tied 

2 to the provision of other services reim3 bursed in whole or in part by the program 

4 under title XVIII or a State health care 

5 program (as so defined); 

6 ‘‘(iii) there is a reasonable connection 

7 between the items or services and the med8 ical care of the individual; and 

9 ‘‘(iv) the person provides the items or 

10 services after determining in good faith 

11 that the individual is in financial need; or 

12 ‘‘(I) effective on a date specified by the 

13 Secretary (but not earlier than January 1, 

14 2011), the waiver by a PDP sponsor of a pre15 scription drug plan under part D of title XVIII 

16 or an MA organization offering an MA–PD 

17 plan under part C of such title of any copay18 ment for the first fill of a covered part D drug 

19 (as defined in section 1860D–2(e)) that is a ge20 neric drug for individuals enrolled in the pre21 scription drug plan or MA–PD plan, respec22 tively.’’. 

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1 rity Act (42 U.S.C. 1320a–7(f)) is amended by adding at 

2 the end the following new paragraph: 

3 ‘‘(4) The provisions of subsections (d) and (e) 

4 of section 205 shall apply with respect to this sec5 tion to the same extent as they are applicable with 

6 respect to title II. The Secretary may delegate the 

7 authority granted by section 205(d) (as made appli8 cable to this section) to the Inspector General of the 

9 Department of Health and Human Services for pur10 poses of any investigation under this section.’’. 

11 (f) HEALTH CARE FRAUD.— 

12 (1) KICKBACKS.—Section 1128B of the Social 

13 Security Act (42 U.S.C. 1320a–7b) is amended by 

14 adding at the end the following new subsection: 

15 ‘‘(g) In addition to the penalties provided for in this 

16 section or section 1128A, a claim that includes items or 

17 services resulting from a violation of this section con18 stitutes a false or fraudulent claim for purposes of sub19 chapter III of chapter 37 of title 31, United States Code.’’. 

20 (2) REVISING THE INTENT REQUIREMENT.— 

21 Section 1128B of the Social Security Act (42 U.S.C. 

22 1320a–7b), as amended by paragraph (1), is amend23 ed by adding at the end the following new sub24 section: 


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1 ‘‘(h) With respect to violations of this section, a per2 son need not have actual knowledge of this section or spe3 cific intent to commit a violation of this section.’’. 

4 (g) SURETY BOND REQUIREMENTS.— 

5 (1) DURABLE MEDICAL EQUIPMENT.—Section 

6 1834(a)(16)(B) of the Social Security Act (42 

7 U.S.C. 1395m(a)(16)(B)) is amended by inserting 

8 ‘‘that the Secretary determines is commensurate 

9 with the volume of the billing of the supplier’’ before 

10 the period at the end. 

11 (2) HOME HEALTH AGENCIES.—Section 

12 1861(o)(7)(C) of the Social Security Act (42 U.S.C. 

13 1395x(o)(7)(C)) is amended by inserting ‘‘that the 

14 Secretary determines is commensurate with the vol15 ume of the billing of the home health agency’’ before 

16 the semicolon at the end. 

17 (3) REQUIREMENTS FOR CERTAIN OTHER PRO18 VIDERS OF SERVICES AND SUPPLIERS.—Section 

19 1862 of the Social Security Act (42 U.S.C. 1395y) 

20 is amended by adding at the end the following new 

21 subsection: 

22 ‘‘(n) REQUIREMENT OF A SURETY BOND FOR CER23 TAIN PROVIDERS OF SERVICES AND SUPPLIERS.— 

24 ‘‘(1) IN GENERAL.—The Secretary may require 

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1 graph (2) to provide the Secretary on a continuing 

2 basis with a surety bond in a form specified by the 

3 Secretary in an amount (not less than $50,000) that 

4 the Secretary determines is commensurate with the 

5 volume of the billing of the provider of services or 

6 supplier. The Secretary may waive the requirement 

7 of a bond under the preceding sentence in the case 

8 of a provider of services or supplier that provides a 

9 comparable surety bond under State law. 

10 ‘‘(2) PROVIDER OF SERVICES OR SUPPLIER DE11 SCRIBED.—A provider of services or supplier de12 scribed in this paragraph is a provider of services or 

13 supplier the Secretary determines appropriate based 

14 on the level of risk involved with respect to the pro15 vider of services or supplier, and consistent with the 

16 surety bond requirements under sections 

17 1834(a)(16)(B) and 1861(o)(7)(C).’’. 

18 (h) SUSPENSION OF MEDICARE AND MEDICAID PAY19 MENTS PENDING INVESTIGATION OF CREDIBLE ALLEGA20 TIONS OF FRAUD.— 

21 (1) MEDICARE.—Section 1862 of the Social Se22 curity Act (42 U.S.C. 1395y), as amended by sub23 section (g)(3), is amended by adding at the end the 

24 following new subsection: 


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1 ‘‘(o) SUSPENSION OF PAYMENTS PENDING INVES2 TIGATION OF CREDIBLE ALLEGATIONS OF FRAUD.— 

3 ‘‘(1) IN GENERAL.—The Secretary may suspend 

4 payments to a provider of services or supplier under 

5 this title pending an investigation of a credible alle6 gation of fraud against the provider of services or 

7 supplier, unless the Secretary determines there is 

8 good cause not to suspend such payments. 

9 ‘‘(2) CONSULTATION.—The Secretary shall con10 sult with the Inspector General of the Department 

11 of Health and Human Services in determining 

12 whether there is a credible allegation of fraud 

13 against a provider of services or supplier. 

14 ‘‘(3) PROMULGATION OF REGULATIONS.—The 

15 Secretary shall promulgate regulations to carry out 

16 this subsection and section 1903(i)(2)(C).’’. 

17 (2) MEDICAID.—Section 1903(i)(2) of such Act 

18 (42 U.S.C. 1396b(i)(2)) is amended— 

19 (A) in subparagraph (A), by striking ‘‘or’’ 

20 at the end; and 

21 (B) by inserting after subparagraph (B), 

22 the following: 

23 ‘‘(C) by any individual or entity to whom 

24 the State has failed to suspend payments under 

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1 ing an investigation of a credible allegation of 

2 fraud against the individual or entity, as deter3 mined by the State in accordance with regula4 tions promulgated by the Secretary for pur5 poses of section 1862(o) and this subparagraph, 

6 unless the State determines in accordance with 

7 such regulations there is good cause not to sus8 pend such payments; or’’. 

9 (i) INCREASED FUNDING TO FIGHT FRAUD AND

10 ABUSE.— 

11 (1) IN GENERAL.—Section 1817(k) of the So12 cial Security Act (42 U.S.C. 1395i(k)) is amended— 

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

14 paragraph: 

15 ‘‘(7) ADDITIONAL FUNDING.—In addition to the 

16 funds otherwise appropriated to the Account from 

17 the Trust Fund under paragraphs (3) and (4) and 

18 for purposes described in paragraphs (3)(C) and 

19 (4)(A), there are hereby appropriated an additional 

20 $10,000,000 to such Account from such Trust Fund 

21 for each of fiscal years 2011 through 2020. The 

22 funds appropriated under this paragraph shall be al23 located in the same proportion as the total funding 

24 appropriated with respect to paragraphs (3)(A) and 

25 (4)(A) was allocated with respect to fiscal year 


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1 2010, and shall be available without further appro2 priation until expended.’’; and 

3 (B) in paragraph (4)(A), by inserting 

4 ‘‘until expended’’ after ‘‘appropriation’’. 

5 (2) INDEXING OF AMOUNTS APPROPRIATED.— 

6 (A) DEPARTMENTS OF HEALTH AND

7 HUMAN SERVICES AND JUSTICE.—Section 

8 1817(k)(3)(A)(i) of the Social Security Act (42 

9 U.S.C. 1395i(k)(3)(A)(i)) is amended— 

10 (i) in subclause (III), by inserting 

11 ‘‘and’’ at the end; 

12 (ii) in subclause (IV)— 

13 (I) by striking ‘‘for each of fiscal 

14 years 2007, 2008, 2009, and 2010’’ 

15 and inserting ‘‘for each fiscal year 

16 after fiscal year 2006’’; and 

17 (II) by striking ‘‘; and’’ and in18 serting a period; and 

19 (iii) by striking subclause (V). 

20 (B) OFFICE OF THE INSPECTOR GENERAL

21 OF THE DEPARTMENT OF HEALTH AND HUMAN

22 SERVICES.—Section 1817(k)(3)(A)(ii) of such 

23 Act (42 U.S.C. 1395i(k)(3)(A)(ii)) is amend24 ed— 


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1 (i) in subclause (VIII), by inserting 

2 ‘‘and’’ at the end; 

3 (ii) in subclause (IX)— 

4 (I) by striking ‘‘for each of fiscal 

5 years 2008, 2009, and 2010’’ and in6 serting ‘‘for each fiscal year after fis7 cal year 2007’’; and 

8 (II) by striking ‘‘; and’’ and in9 serting a period; and 

10 (iii) by striking subclause (X). 

11 (C) FEDERAL BUREAU OF INVESTIGA12 TION.—Section 1817(k)(3)(B) of the Social Se13 curity Act (42 U.S.C. 1395i(k)(3)(B)) is 

14 amended— 

15 (i) in clause (vii), by inserting ‘‘and’’ 

16 at the end; 

17 (ii) in clause (viii)— 

18 (I) by striking ‘‘for each of fiscal 

19 years 2007, 2008, 2009, and 2010’’ 

20 and inserting ‘‘for each fiscal year 

21 after fiscal year 2006’’; and 

22 (II) by striking ‘‘; and’’ and in23 serting a period; and 

24 (iii) by striking clause (ix). 


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1 (D) MEDICARE INTEGRITY PROGRAM.— 

2 Section 1817(k)(4)(C) of the Social Security 

3 Act (42 U.S.C. 1395i(k)(4)(C)) is amended by 

4 adding at the end the following new clause: 

5 ‘‘(ii) For each fiscal year after 2010, 

6 by the percentage increase in the consumer 

7 price index for all urban consumers (all 

8 items; United States city average) over the 

9 previous year.’’. 

10 (j) MEDICARE INTEGRITY PROGRAM AND MEDICAID

11 INTEGRITY PROGRAM.— 

12 (1) MEDICARE INTEGRITY PROGRAM.— 

13 (A) REQUIREMENT TO PROVIDE PERFORM14 ANCE STATISTICS.—Section 1893(c) of the So15 cial Security Act (42 U.S.C. 1395ddd(c)) is 

16 amended— 

17 (i) in paragraph (3), by striking 

18 ‘‘and’’ at the end; 

19 (ii) by redesignating paragraph (4) as 

20 paragraph (5); and 

21 (iii) by inserting after paragraph (3) 

22 the following new paragraph: 

23 ‘‘(4) the entity agrees to provide the Secretary 

24 and the Inspector General of the Department of 

25 Health and Human Services with such performance 


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1 statistics (including the number and amount of over2 payments recovered, the number of fraud referrals, 

3 and the return on investment of such activities by 

4 the entity) as the Secretary or the Inspector General 

5 may request; and’’. 

6 (B) EVALUATIONS AND ANNUAL RE7 PORT.—Section 1893 of the Social Security Act 

8 (42 U.S.C. 1395ddd) is amended by adding at 

9 the end the following new subsection: 

10 ‘‘(i) EVALUATIONS AND ANNUAL REPORT.— 

11 ‘‘(1) EVALUATIONS.—The Secretary shall con12 duct evaluations of eligible entities which the Sec13 retary contracts with under the Program not less 

14 frequently than every 3 years. 

15 ‘‘(2) ANNUAL REPORT.—Not later than 180 

16 days after the end of each fiscal year (beginning 

17 with fiscal year 2011), the Secretary shall submit a 

18 report to Congress which identifies— 

19 ‘‘(A) the use of funds, including funds 

20 transferred from the Federal Hospital Insur21 ance Trust Fund under section 1817 and the 

22 Federal Supplementary Insurance Trust Fund 

23 under section 1841, to carry out this section; 

24 and 


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1 ‘‘(B) the effectiveness of the use of such 

2 funds.’’. 

3 (C) FLEXIBILITY IN PURSUING FRAUD

4 AND ABUSE.—Section 1893(a) of the Social Se5 curity Act (42 U.S.C. 1395ddd(a)) is amended 

6 by inserting ‘‘, or otherwise,’’ after ‘‘entities’’. 

7 (2) MEDICAID INTEGRITY PROGRAM.— 

8 (A) REQUIREMENT TO PROVIDE PERFORM9 ANCE STATISTICS.—Section 1936(c)(2) of the 

10 Social Security Act (42 U.S.C. 1396u–6(c)(2)) 

11 is amended— 

12 (i) by redesignating subparagraph (D) 

13 as subparagraph (E); and 

14 (ii) by inserting after subparagraph 

15 (C) the following new subparagraph: 

16 ‘‘(D) The entity agrees to provide the Sec17 retary and the Inspector General of the Depart18 ment of Health and Human Services with such 

19 performance statistics (including the number 

20 and amount of overpayments recovered, the 

21 number of fraud referrals, and the return on in22 vestment of such activities by the entity) as the 

23 Secretary or the Inspector General may re24 quest.’’. 


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1 (B) EVALUATIONS AND ANNUAL RE2 PORT.—Section 1936(e) of the Social Security 

3 Act (42 U.S.C. 1396u–7(e)) is amended— 

4 (i) by redesignating paragraph (4) as 

5 paragraph (5); and 

6 (ii) by inserting after paragraph (3) 

7 the following new paragraph: 

8 ‘‘(4) EVALUATIONS.—The Secretary shall con9 duct evaluations of eligible entities which the Sec10 retary contracts with under the Program not less 

11 frequently than every 3 years.’’. 

12 (k) EXPANDED APPLICATION OF HARDSHIP WAIV13 ERS FOR EXCLUSIONS.—Section 1128(c)(3)(B) of the So14 cial Security Act (42 U.S.C. 1320a–7(c)(3)(B)) is amend15 ed by striking ‘‘individuals entitled to benefits under part 

16 A of title XVIII or enrolled under part B of such title, 

17 or both’’ and inserting ‘‘beneficiaries (as defined in section 

18 1128A(i)(5)) of that program’’. 

19 SEC. 6403. ELIMINATION OF DUPLICATION BETWEEN THE 

20 HEALTHCARE INTEGRITY AND PROTECTION 

21 DATA BANK AND THE NATIONAL PRACTI22 TIONER DATA BANK. 

23 (a) INFORMATION REPORTED BY FEDERAL AGEN24 CIES AND HEALTH PLANS.—Section 1128E of the Social 

25 Security Act (42 U.S.C. 1320a–7e) is amended— 


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1 (1) by striking subsection (a) and inserting the 

2 following: 

3 ‘‘(a) IN GENERAL.—The Secretary shall maintain a 

4 national health care fraud and abuse data collection pro5 gram under this section for the reporting of certain final 

6 adverse actions (not including settlements in which no 

7 findings of liability have been made) against health care 

8 providers, suppliers, or practitioners as required by sub9 section (b), with access as set forth in subsection (d), and 

10 shall furnish the information collected under this section 

11 to the National Practitioner Data Bank established pursu12 ant to the Health Care Quality Improvement Act of 1986 

13 (42 U.S.C. 11101 et seq.).’’; 

14 (2) by striking subsection (d) and inserting the 

15 following: 

16 ‘‘(d) ACCESS TO REPORTED INFORMATION.— 

17 ‘‘(1) AVAILABILITY.—The information collected 

18 under this section shall be available from the Na19 tional Practitioner Data Bank to the agencies, au20 thorities, and officials which are provided under sec21 tion 1921(b) information reported under section 

22 1921(a). 

23 ‘‘(2) FEES FOR DISCLOSURE.—The Secretary 

24 may establish or approve reasonable fees for the dis25 closure of information under this section. The 


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1 amount of such a fee may not exceed the costs of 

2 processing the requests for disclosure and of pro3 viding such information. Such fees shall be available 

4 to the Secretary to cover such costs.’’; 

5 (3) by striking subsection (f) and inserting the 

6 following: 

7 ‘‘(f) APPROPRIATE COORDINATION.—In imple8 menting this section, the Secretary shall provide for the 

9 maximum appropriate coordination with part B of the 

10 Health Care Quality Improvement Act of 1986 (42 U.S.C. 

11 11131 et seq.) and section 1921.’’; and 

12 (4) in subsection (g)— 

13 (A) in paragraph (1)(A)— 

14 (i) in clause (iii)— 

15 (I) by striking ‘‘or State’’ each 

16 place it appears; 

17 (II) by redesignating subclauses 

18 (II) and (III) as subclauses (III) and 

19 (IV), respectively; and 

20 (III) by inserting after subclause 

21 (I) the following new subclause: 

22 ‘‘(II) any dismissal or closure of 

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1 dering their license or leaving the 

2 State or jurisdiction’’; and 

3 (ii) by striking clause (iv) and insert4 ing the following: 

5 ‘‘(iv) Exclusion from participation in a 

6 Federal health care program (as defined in 

7 section 1128B(f)).’’; 

8 (B) in paragraph (3)— 

9 (i) by striking subparagraphs (D) and 

10 (E); and 

11 (ii) by redesignating subparagraph 

12 (F) as subparagraph (D); and 

13 (C) in subparagraph (D) (as so redesig14 nated), by striking ‘‘or State’’. 

15 (b) INFORMATION REPORTED BY STATE LAW OR

16 FRAUD ENFORCEMENT AGENCIES.—Section 1921 of the 

17 Social Security Act (42 U.S.C. 1396r–2) is amended— 

18 (1) in subsection (a)— 

19 (A) in paragraph (1)— 

20 (i) by striking ‘‘SYSTEM.—The State’’ 

21 and all that follows through the semicolon 

22 and inserting SYSTEM.— 

23 ‘‘(A) LICENSING OR CERTIFICATION AC24 TIONS.—The State must have in effect a system 

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1 spect to formal proceedings (as defined by the 

2 Secretary in regulations) concluded against a 

3 health care practitioner or entity by a State li4 censing or certification agency:’’; 

5 (ii) by redesignating subparagraphs 

6 (A) through (D) as clauses (i) through 

7 (iv), respectively, and indenting appro8 priately; 

9 (iii) in subparagraph (A)(iii) (as so 

10 redesignated)— 

11 (I) by striking ‘‘the license of’’ 

12 and inserting ‘‘license or the right to 

13 apply for, or renew, a license by’’; and 

14 (II) by inserting ‘‘nonrenew15 ability,’’ after ‘‘voluntary surrender,’’; 

16 and 

17 (iv) by adding at the end the following 

18 new subparagraph: 

19 ‘‘(B) OTHER FINAL ADVERSE ACTIONS.— 

20 The State must have in effect a system of re21 porting information with respect to any final 

22 adverse action (not including settlements in 

23 which no findings of liability have been made) 

24 taken against a health care provider, supplier, 


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1 or practitioner by a State law or fraud enforce2 ment agency.’’; and 

3 (B) in paragraph (2), by striking ‘‘the au4 thority described in paragraph (1)’’ and insert5 ing ‘‘a State licensing or certification agency or 

6 State law or fraud enforcement agency’’; 

7 (2) in subsection (b)— 

8 (A) by striking paragraph (2) and insert9 ing the following: 

10 ‘‘(2) to State licensing or certification agencies 

11 and Federal agencies responsible for the licensing 

12 and certification of health care providers, suppliers, 

13 and licensed health care practitioners;’’; 

14 (B) in each of paragraphs (4) and (6), by 

15 inserting ‘‘, but only with respect to information 

16 provided pursuant to subsection (a)(1)(A)’’ be17 fore the comma at the end; 

18 (C) by striking paragraph (5) and insert19 ing the following: 

20 ‘‘(5) to State law or fraud enforcement agen21 cies,’’; 

22 (D) by redesignating paragraphs (7) and 

23 (8) as paragraphs (8) and (9), respectively; and 

24 (E) by inserting after paragraph (6) the 

25 following new paragraph: 


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1 ‘‘(7) to health plans (as defined in section 

2 1128C(c));’’; 

3 (3) by redesignating subsection (d) as sub4 section (h), and by inserting after subsection (c) the 

5 following new subsections: 

6 ‘‘(d) DISCLOSURE AND CORRECTION OF INFORMA7 TION.— 

8 ‘‘(1) DISCLOSURE.—With respect to informa9 tion reported pursuant to subsection (a)(1), the Sec10 retary shall— 

11 ‘‘(A) provide for disclosure of the informa12 tion, upon request, to the health care practi13 tioner who, or the entity that, is the subject of 

14 the information reported; and 

15 ‘‘(B) establish procedures for the case 

16 where the health care practitioner or entity dis17 putes the accuracy of the information reported. 

18 ‘‘(2) CORRECTIONS.—Each State licensing or 

19 certification agency and State law or fraud enforce20 ment agency shall report corrections of information 

21 already reported about any formal proceeding or 

22 final adverse action described in subsection (a), in 

23 such form and manner as the Secretary prescribes 

24 by regulation. 


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1 ‘‘(e) FEES FOR DISCLOSURE.—The Secretary may 

2 establish or approve reasonable fees for the disclosure of 

3 information under this section. The amount of such a fee 

4 may not exceed the costs of processing the requests for 

5 disclosure and of providing such information. Such fees 

6 shall be available to the Secretary to cover such costs. 

7 ‘‘(f) PROTECTION FROM LIABILITY FOR REPORT8 ING.—No person or entity, including any agency des9 ignated by the Secretary in subsection (b), shall be held 

10 liable in any civil action with respect to any reporting of 

11 information as required under this section, without knowl12 edge of the falsity of the information contained in the re13 port. 

14 ‘‘(g) REFERENCES.—For purposes of this section: 

15 ‘‘(1) STATE LICENSING OR CERTIFICATION

16 AGENCY.—The term ‘State licensing or certification 

17 agency’ includes any authority of a State (or of a 

18 political subdivision thereof) responsible for the li19 censing of health care practitioners (or any peer re20 view organization or private accreditation entity re21 viewing the services provided by health care practi22 tioners) or entities. 

23 ‘‘(2) STATE LAW OR FRAUD ENFORCEMENT

24 AGENCY.—The term ‘State law or fraud enforcement 

25 agency’ includes— 


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1 ‘‘(A) a State law enforcement agency; and 

2 ‘‘(B) a State medicaid fraud control unit 

3 (as defined in section 1903(q)). 

4 ‘‘(3) FINAL ADVERSE ACTION.— 

5 ‘‘(A) IN GENERAL.—Subject to subpara6 graph (B), the term ‘final adverse action’ in7 cludes— 

8 ‘‘(i) civil judgments against a health 

9 care provider, supplier, or practitioner in 

10 State court related to the delivery of a 

11 health care item or service; 

12 ‘‘(ii) State criminal convictions related 

13 to the delivery of a health care item or 

14 service; 

15 ‘‘(iii) exclusion from participation in 

16 State health care programs (as defined in 

17 section 1128(h)); 

18 ‘‘(iv) any licensing or certification ac19 tion described in subsection (a)(1)(A) 

20 taken against a supplier by a State licens21 ing or certification agency; and 

22 ‘‘(v) any other adjudicated actions or 

23 decisions that the Secretary shall establish 

24 by regulation. 


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1 ‘‘(B) EXCEPTION.—Such term does not in2 clude any action with respect to a malpractice 

3 claim.’’; and 

4 (4) in subsection (h), as so redesignated, by 

5 striking ‘‘The Secretary’’ and all that follows 

6 through the period at the end and inserting ‘‘In im7 plementing this section, the Secretary shall provide 

8 for the maximum appropriate coordination with part 

9 B of the Health Care Quality Improvement Act of 

10 1986 (42 U.S.C. 11131 et seq.) and section 

11 1128E.’’. 

12 (c) CONFORMING AMENDMENT.—Section 

13 1128C(a)(1) of the Social Security Act (42 U.S.C. 1320a– 

14 7c(a)(1)) is amended— 

15 (1) in subparagraph (C), by adding ‘‘and’’ after 

16 the comma at the end; 

17 (2) in subparagraph (D), by striking ‘‘, and’’ 

18 and inserting a period; and 

19 (3) by striking subparagraph (E). 

20 (d) TRANSITION PROCESS; EFFECTIVE DATE.— 

21 (1) IN GENERAL.—Effective on the date of en22 actment of this Act, the Secretary of Health and 

23 Human Services (in this section referred to as the 

24 ‘‘Secretary’’) shall implement a transition process 

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1 tion period described in paragraph (5), the Secretary 

2 shall cease operating the Healthcare Integrity and 

3 Protection Data Bank established under section 

4 1128E of the Social Security Act (as in effect before 

5 the effective date specified in paragraph (6)) and 

6 shall transfer all data collected in the Healthcare In7 tegrity and Protection Data Bank to the National 

8 Practitioner Data Bank established pursuant to the 

9 Health Care Quality Improvement Act of 1986 (42 

10 U.S.C. 11101 et seq.). During such transition proc11 ess, the Secretary shall have in effect appropriate 

12 procedures to ensure that data collection and access 

13 to the Healthcare Integrity and Protection Data 

14 Bank and the National Practitioner Data Bank are 

15 not disrupted. 

16 (2) REGULATIONS.—The Secretary shall pro17 mulgate regulations to carry out the amendments 

18 made by subsections (a) and (b). 

19 (3) FUNDING.— 

20 (A) AVAILABILITY OF FEES.—Fees col21 lected pursuant to section 1128E(d)(2) of the 

22 Social Security Act prior to the effective date 

23 specified in paragraph (6) for the disclosure of 

24 information in the Healthcare Integrity and 

25 Protection Data Bank shall be available to the 


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1 Secretary, without fiscal year limitation, for 

2 payment of costs related to the transition proc3 ess described in paragraph (1). Any such fees 

4 remaining after the transition period is com5 plete shall be available to the Secretary, without 

6 fiscal year limitation, for payment of the costs 

7 of operating the National Practitioner Data 

8 Bank. 

9 (B) AVAILABILITY OF ADDITIONAL

10 FUNDS.—In addition to the fees described in 

11 subparagraph (A), any funds available to the 

12 Secretary or to the Inspector General of the 

13 Department of Health and Human Services for 

14 a purpose related to combating health care 

15 fraud, waste, or abuse shall be available to the 

16 extent necessary for operating the Healthcare 

17 Integrity and Protection Data Bank during the 

18 transition period, including systems testing and 

19 other activities necessary to ensure that infor20 mation formerly reported to the Healthcare In21 tegrity and Protection Data Bank will be acces22 sible through the National Practitioner Data 

23 Bank after the end of such transition period. 


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1 (4) SPECIAL PROVISION FOR ACCESS TO THE

2 NATIONAL PRACTITIONER DATA BANK BY THE DE3 PARTMENT OF VETERANS AFFAIRS.— 

4 (A) IN GENERAL.—Notwithstanding any 

5 other provision of law, during the 1-year period 

6 that begins on the effective date specified in 

7 paragraph (6), the information described in 

8 subparagraph (B) shall be available from the 

9 National Practitioner Data Bank to the Sec10 retary of Veterans Affairs without charge. 

11 (B) INFORMATION DESCRIBED.—For pur12 poses of subparagraph (A), the information de13 scribed in this subparagraph is the information 

14 that would, but for the amendments made by 

15 this section, have been available to the Sec16 retary of Veterans Affairs from the Healthcare 

17 Integrity and Protection Data Bank. 

18 (5) TRANSITION PERIOD DEFINED.—For pur19 poses of this subsection, the term ‘‘transition pe20 riod’’ means the period that begins on the date of 

21 enactment of this Act and ends on the later of— 

22 (A) the date that is 1 year after such date 

23 of enactment; or 

24 (B) the effective date of the regulations 

25 promulgated under paragraph (2). 


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1 (6) EFFECTIVE DATE.—The amendments made 

2 by subsections (a), (b), and (c) shall take effect on 

3 the first day after the final day of the transition pe4 riod. 

5 SEC. 6404. MAXIMUM PERIOD FOR SUBMISSION OF MEDI6 CARE CLAIMS REDUCED TO NOT MORE THAN 

7 12 MONTHS. 

8 (a) REDUCING MAXIMUM PERIOD FOR SUBMIS9 SION.— 

10 (1) PART A.—Section 1814(a) of the Social Se11 curity Act (42 U.S.C. 1395f(a)(1)) is amended— 

12 (A) in paragraph (1), by striking ‘‘period 

13 of 3 calendar years’’ and all that follows 

14 through the semicolon and inserting ‘‘period 

15 ending 1 calendar year after the date of serv16 ice;’’; and 

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

18 sentence: ‘‘In applying paragraph (1), the Sec19 retary may specify exceptions to the 1 calendar 

20 year period specified in such paragraph.’’ 

21 (2) PART B.— 

22 (A) Section 1842(b)(3) of such Act (42 

23 U.S.C. 1395u(b)(3)(B)) is amended— 

24 (i) in subparagraph (B), in the flush 

25 language following clause (ii), by striking 


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1 ‘‘close of the calendar year following the 

2 year in which such service is furnished 

3 (deeming any service furnished in the last 

4 3 months of any calendar year to have 

5 been furnished in the succeeding calendar 

6 year)’’ and inserting ‘‘period ending 1 cal7 endar year after the date of service’’; and 

8 (ii) by adding at the end the following 

9 new sentence: ‘‘In applying subparagraph 

10 (B), the Secretary may specify exceptions 

11 to the 1 calendar year period specified in 

12 such subparagraph.’’ 

13 (B) Section 1835(a) of such Act (42 

14 U.S.C. 1395n(a)) is amended— 

15 (i) in paragraph (1), by striking ‘‘pe16 riod of 3 calendar years’’ and all that fol17 lows through the semicolon and inserting 

18 ‘‘period ending 1 calendar year after the 

19 date of service;’’; and 

20 (ii) by adding at the end the following 

21 new sentence: ‘‘In applying paragraph (1), 

22 the Secretary may specify exceptions to the 

23 1 calendar year period specified in such 

24 paragraph.’’ 

25 (b) EFFECTIVE DATE.— 


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1 (1) IN GENERAL.—The amendments made by 

2 subsection (a) shall apply to services furnished on or 

3 after January 1, 2010. 

4 (2) SERVICES FURNISHED BEFORE 2010.—In 

5 the case of services furnished before January 1, 

6 2010, a bill or request for payment under section 

7 1814(a)(1), 1842(b)(3)(B), or 1835(a) shall be filed 

8 not later that December 31, 2010. 

9 SEC. 6405. PHYSICIANS WHO ORDER ITEMS OR SERVICES 

10 REQUIRED TO BE MEDICARE ENROLLED PHY11 SICIANS OR ELIGIBLE PROFESSIONALS. 

12 (a) DME.—Section 1834(a)(11)(B) of the Social Se13 curity Act (42 U.S.C. 1395m(a)(11)(B)) is amended by 

14 striking ‘‘physician’’ and inserting ‘‘physician enrolled 

15 under section 1866(j) or an eligible professional under sec16 tion 1848(k)(3)(B) that is enrolled under section 

17 1866(j)’’. 

18 (b) HOME HEALTH SERVICES.— 

19 (1) PART A.—Section 1814(a)(2) of such Act 

20 (42 U.S.C. 1395(a)(2)) is amended in the matter 

21 preceding subparagraph (A) by inserting ‘‘in the 

22 case of services described in subparagraph (C), a 

23 physician enrolled under section 1866(j) or an eligi24 ble professional under section 1848(k)(3)(B),’’ be25 fore ‘‘or, in the case of services’’. 


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1 (2) PART B.—Section 1835(a)(2) of such Act 

2 (42 U.S.C. 1395n(a)(2)) is amended in the matter 

3 preceding subparagraph (A) by inserting ‘‘, or in the 

4 case of services described in subparagraph (A), a 

5 physician enrolled under section 1866(j) or an eligi6 ble professional under section 1848(k)(3)(B),’’ after 

7 ‘‘a physician’’. 

8 (c) APPLICATION TO OTHER ITEMS OR SERVICES.— 

9 The Secretary may extend the requirement applied by the 

10 amendments made by subsections (a) and (b) to durable 

11 medical equipment and home health services (relating to 

12 requiring certifications and written orders to be made by 

13 enrolled physicians and health professions) to all other 

14 categories of items or services under title XVIII of the 

15 Social Security Act (42 U.S.C. 1395 et seq.), including 

16 covered part D drugs as defined in section 1860D–2(e) 

17 of such Act (42 U.S.C. 1395w–102), that are ordered, pre18 scribed, or referred by a physician enrolled under section 

19 1866(j) of such Act (42 U.S.C. 1395cc(j)) or an eligible 

20 professional under section 1848(k)(3)(B) of such Act (42 

21 U.S.C. 1395w–4(k)(3)(B)). 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to written orders and certifications 

24 made on or after July 1, 2010. 


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1 SEC. 6406. REQUIREMENT FOR PHYSICIANS TO PROVIDE 

2 DOCUMENTATION ON REFERRALS TO PRO3 GRAMS AT HIGH RISK OF WASTE AND ABUSE. 

4 (a) PHYSICIANS AND OTHER SUPPLIERS.—Section 

5 1842(h) of the Social Security Act (42 U.S.C. 1395u(h)) 

6 is amended by adding at the end the following new para7 graph 

8 ‘‘(9) The Secretary may revoke enrollment, for a pe9 riod of not more than one year for each act, for a physi10 cian or supplier under section 1866(j) if such physician 

11 or supplier fails to maintain and, upon request of the Sec12 retary, provide access to documentation relating to written 

13 orders or requests for payment for durable medical equip14 ment, certifications for home health services, or referrals 

15 for other items or services written or ordered by such phy16 sician or supplier under this title, as specified by the Sec17 retary.’’. 

18 (b) PROVIDERS OF SERVICES.—Section 1866(a)(1) 

19 of such Act (42 U.S.C. 1395cc) is further amended— 

20 (1) in subparagraph (U), by striking at the end 

21 ‘‘and’’; 

22 (2) in subparagraph (V), by striking the period 

23 at the end and adding ‘‘; and’’; and 

24 (3) by adding at the end the following new sub25 paragraph: 


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1 ‘‘(W) maintain and, upon request of the 

2 Secretary, provide access to documentation re3 lating to written orders or requests for payment 

4 for durable medical equipment, certifications for 

5 home health services, or referrals for other 

6 items or services written or ordered by the pro7 vider under this title, as specified by the Sec8 retary.’’. 

9 (c) OIG PERMISSIVE EXCLUSION AUTHORITY.—Sec10 tion 1128(b)(11) of the Social Security Act (42 U.S.C. 

11 1320a–7(b)(11)) is amended by inserting ‘‘, ordering, re12 ferring for furnishing, or certifying the need for’’ after 

13 ‘‘furnishing’’. 

14 (d) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to orders, certifications, and refer16 rals made on or after January 1, 2010. 

17 SEC. 6407. FACE TO FACE ENCOUNTER WITH PATIENT RE18 QUIRED BEFORE PHYSICIANS MAY CERTIFY 

19 ELIGIBILITY FOR HOME HEALTH SERVICES 

20 OR DURABLE MEDICAL EQUIPMENT UNDER 

21 MEDICARE. 

22 (a) CONDITION OF PAYMENT FOR HOME HEALTH

23 SERVICES.— 

24 (1) PART A.—Section 1814(a)(2)(C) of such 

25 Act is amended— 


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1 (A) by striking ‘‘and such services’’ and in2 serting ‘‘such services’’; and 

3 (B) by inserting after ‘‘care of a physi4 cian’’ the following: ‘‘, and, in the case of a cer5 tification made by a physician after January 1, 

6 2010, prior to making such certification the 

7 physician must document that the physician 

8 himself or herself has had a face-to-face en9 counter (including through use of telehealth, 

10 subject to the requirements in section 1834(m), 

11 and other than with respect to encounters that 

12 are incident to services involved) with the indi13 vidual within a reasonable timeframe as deter14 mined by the Secretary’’. 

15 (2) PART B.—Section 1835(a)(2)(A) of the So16 cial Security Act is amended— 

17 (A) by striking ‘‘and’’ before ‘‘(iii)’’; and 

18 (B) by inserting after ‘‘care of a physi19 cian’’ the following: ‘‘, and (iv) in the case of 

20 a certification after January 1, 2010, prior to 

21 making such certification the physician must 

22 document that the physician has had a face-to23 face encounter (including through use of tele24 health and other than with respect to encoun25 ters that are incident to services involved) with 


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1 the individual during the 6-month period pre2 ceding such certification, or other reasonable 

3 timeframe as determined by the Secretary’’. 

4 (b) CONDITION OF PAYMENT FOR DURABLE MED5 ICAL EQUIPMENT.—Section 1834(a)(11)(B) of the Social 

6 Security Act (42 U.S.C. 1395m(a)(11)(B)) is amended— 

7 (1) by striking ‘‘ORDER.—The Secretary’’ and 

8 inserting ‘‘ORDER.— 

9 ‘‘(i) IN GENERAL.—The Secretary’’; 

10 and 

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

12 clause: 

13 ‘‘(ii) REQUIREMENT FOR FACE TO

14 FACE ENCOUNTER.—The Secretary shall 

15 require that such an order be written pur16 suant to the physician documenting that a 

17 physician, a physician assistant, a nurse 

18 practitioner, or a clinical nurse specialist 

19 (as those terms are defined in section 

20 1861(aa)(5)) has had a face-to-face en21 counter (including through use of tele22 health under subsection (m) and other 

23 than with respect to encounters that are 

24 incident to services involved) with the indi25 vidual involved during the 6-month period 


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1 preceding such written order, or other rea2 sonable timeframe as determined by the 

3 Secretary.’’. 

4 (c) APPLICATION TO OTHER AREAS UNDER MEDI5 CARE.—The Secretary may apply the face-to-face encoun6 ter requirement described in the amendments made by 

7 subsections (a) and (b) to other items and services for 

8 which payment is provided under title XVIII of the Social 

9 Security Act based upon a finding that such an decision 

10 would reduce the risk of waste, fraud, or abuse. 

11 (d) APPLICATION TO MEDICAID.—The requirements 

12 pursuant to the amendments made by subsections (a) and 

13 (b) shall apply in the case of physicians making certifi14 cations for home health services under title XIX of the 

15 Social Security Act in the same manner and to the same 

16 extent as such requirements apply in the case of physi17 cians making such certifications under title XVIII of such 

18 Act. 

19 SEC. 6408. ENHANCED PENALTIES. 

20 (a) CIVIL MONETARY PENALTIES FOR FALSE STATE21 MENTS OR DELAYING INSPECTIONS.—Section 1128A(a) 

22 of the Social Security Act (42 U.S.C. 1320a–7a(a)), as 

23 amended by section 5002(d)(2)(A), is amended— 

24 (1) in paragraph (6), by striking ‘‘or’’ at the 

25 end; and 


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1 (2) by inserting after paragraph (7) the fol2 lowing new paragraphs: 

3 ‘‘(8) knowingly makes, uses, or causes to be 

4 made or used, a false record or statement material 

5 to a false or fraudulent claim for payment for items 

6 and services furnished under a Federal health care 

7 program; or 

8 ‘‘(9) fails to grant timely access, upon reason9 able request (as defined by the Secretary in regula10 tions), to the Inspector General of the Department 

11 of Health and Human Services, for the purpose of 

12 audits, investigations, evaluations, or other statutory 

13 functions of the Inspector General of the Depart14 ment of Health and Human Services;’’; and 

15 (3) in the first sentence— 

16 (A) by striking ‘‘or in cases under para17 graph (7)’’ and inserting ‘‘in cases under para18 graph (7)’’; and 

19 (B) by striking ‘‘act)’’ and inserting ‘‘act, 

20 in cases under paragraph (8), $50,000 for each 

21 false record or statement, or in cases under 

22 paragraph (9), $15,000 for each day of the fail23 ure described in such paragraph)’’. 

24 (b) MEDICARE ADVANTAGE AND PART D PLANS.— 


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1 (1) ENSURING TIMELY INSPECTIONS RELATING

2 TO CONTRACTS WITH MA ORGANIZATIONS.—Section 

3 1857(d)(2) of such Act (42 U.S.C. 1395w–27(d)(2)) 

4 is amended— 

5 (A) in subparagraph (A), by inserting 

6 ‘‘timely’’ before ‘‘inspect’’; and 

7 (B) in subparagraph (B), by inserting 

8 ‘‘timely’’ before ‘‘audit and inspect’’. 

9 (2) MARKETING VIOLATIONS.—Section 

10 1857(g)(1) of the Social Security Act (42 U.S.C. 

11 1395w—27(g)(1)) is amended— 

12 (A) in subparagraph (F), by striking ‘‘or’’ 

13 at the end; 

14 (B) by inserting after subparagraph (G) 

15 the following new subparagraphs: 

16 ‘‘(H) except as provided under subpara17 graph (C) or (D) of section 1860D–1(b)(1), en18 rolls an individual in any plan under this part 

19 without the prior consent of the individual or 

20 the designee of the individual; 

21 ‘‘(I) transfers an individual enrolled under 

22 this part from one plan to another without the 

23 prior consent of the individual or the designee 

24 of the individual or solely for the purpose of 

25 earning a commission; 


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1 ‘‘(J) fails to comply with marketing re2 strictions described in subsections (h) and (j) of 

3 section 1851 or applicable implementing regula4 tions or guidance; or 

5 ‘‘(K) employs or contracts with any indi6 vidual or entity who engages in the conduct de7 scribed in subparagraphs (A) through (J) of 

8 this paragraph;’’; and 

9 (C) by adding at the end the following new 

10 sentence: ‘‘The Secretary may provide, in addi11 tion to any other remedies authorized by law, 

12 for any of the remedies described in paragraph 

13 (2), if the Secretary determines that any em14 ployee or agent of such organization, or any 

15 provider or supplier who contracts with such or16 ganization, has engaged in any conduct de17 scribed in subparagraphs (A) through (K) of 

18 this paragraph.’’. 

19 (3) PROVISION OF FALSE INFORMATION.—Sec20 tion 1857(g)(2)(A) of the Social Security Act (42 

21 U.S.C. 1395w—27(g)(2)(A)) is amended by insert22 ing ‘‘except with respect to a determination under 

23 subparagraph (E), an assessment of not more than 

24 the amount claimed by such plan or plan sponsor 

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1 mation involved,’’ after ‘‘for each such determina2 tion,’’. 

3 (c) OBSTRUCTION OF PROGRAM AUDITS.—Section 

4 1128(b)(2) of the Social Security Act (42 U.S.C. 1320a– 

5 7(b)(2)) is amended— 

6 (1) in the heading, by inserting ‘‘OR AUDIT’’ 

7 after ‘‘INVESTIGATION’’; and 

8 (2) by striking ‘‘investigation into’’ and all that 

9 follows through the period and inserting ‘‘investiga10 tion or audit related to—’’ 

11 ‘‘(i) any offense described in para12 graph (1) or in subsection (a); or 

13 ‘‘(ii) the use of funds received, directly 

14 or indirectly, from any Federal health care 

15 program (as defined in section 

16 1128B(f)).’’. 

17 (d) EFFECTIVE DATE.— 

18 (1) IN GENERAL.—Except as provided in para19 graph (2), the amendments made by this section 

20 shall apply to acts committed on or after January 1, 

21 2010. 

22 (2) EXCEPTION.—The amendments made by 

23 subsection (b)(1) take effect on the date of enact24 ment of this Act. 


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1 SEC. 6409. MEDICARE SELF-REFERRAL DISCLOSURE PRO2 TOCOL. 

3 (a) DEVELOPMENT OF SELF-REFERRAL DISCLO4 SURE PROTOCOL.— 

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

6 Human Services, in cooperation with the Inspector 

7 General of the Department of Health and Human 

8 Services, shall establish, not later than 6 months 

9 after the date of the enactment of this Act, a pro10 tocol to enable health care providers of services and 

11 suppliers to disclose an actual or potential violation 

12 of section 1877 of the Social Security Act (42 

13 U.S.C. 1395nn) pursuant to a self-referral disclosure 

14 protocol (in this section referred to as an ‘‘SRDP’’). 

15 The SRDP shall include direction to health care pro16 viders of services and suppliers on— 

17 (A) a specific person, official, or office to 

18 whom such disclosures shall be made; and 

19 (B) instruction on the implication of the 

20 SRDP on corporate integrity agreements and 

21 corporate compliance agreements. 

22 (2) PUBLICATION ON INTERNET WEBSITE OF

23 SRDP INFORMATION.—The Secretary of Health and 

24 Human Services shall post information on the public 

25 Internet website of the Centers for Medicare & Med26 icaid Services to inform relevant stakeholders of how 


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1 to disclose actual or potential violations pursuant to 

2 an SRDP. 

3 (3) RELATION TO ADVISORY OPINIONS.—The 

4 SRDP shall be separate from the advisory opinion 

5 process set forth in regulations implementing section 

6 1877(g) of the Social Security Act. 

7 (b) REDUCTION IN AMOUNTS OWED.—The Secretary 

8 of Health and Human Services is authorized to reduce the 

9 amount due and owing for all violations under section 

10 1877 of the Social Security Act to an amount less than 

11 that specified in subsection (g) of such section. In estab12 lishing such amount for a violation, the Secretary may 

13 consider the following factors: 

14 (1) The nature and extent of the improper or 

15 illegal practice. 

16 (2) The timeliness of such self-disclosure. 

17 (3) The cooperation in providing additional in18 formation related to the disclosure. 

19 (4) Such other factors as the Secretary con20 siders appropriate. 

21 (c) REPORT.—Not later than 18 months after the 

22 date on which the SRDP protocol is established under sub23 section (a)(1), the Secretary shall submit to Congress a 

24 report on the implementation of this section. Such report 

25 shall include— 


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1 (1) the number of health care providers of serv2 ices and suppliers making disclosures pursuant to 

3 the SRDP; 

4 (2) the amounts collected pursuant to the 

5 SRDP; 

6 (3) the types of violations reported under the 

7 SRDP; and 

8 (4) such other information as may be necessary 

9 to evaluate the impact of this section. 

10 SEC. 6410. ADJUSTMENTS TO THE MEDICARE DURABLE 

11 MEDICAL EQUIPMENT, PROSTHETICS, 

12 ORTHOTICS, AND SUPPLIES COMPETITIVE 

13 ACQUISITION PROGRAM. 

14 (a) EXPANSION OF ROUND 2 OF THE DME COM15 PETITIVE BIDDING PROGRAM.—Section 1847(a)(1) of the 

16 Social Security Act (42 U.S.C. 1395w–3(a)(1)) is amend17 ed— 

18 (1) in subparagraph (B)(i)(II), by striking ‘‘70’’ 

19 and inserting ‘‘91’’; and 

20 (2) in subparagraph (D)(ii)— 

21 (A) in subclause (I), by striking ‘‘and’’ at 

22 the end; 

23 (B) by redesignating subclause (II) as sub24 clause (III); and 


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1 (C) by inserting after subclause (I) the fol2 lowing new subclause: 

3 ‘‘(II) the Secretary shall include 

4 the next 21 largest metropolitan sta5 tistical areas by total population 

6 (after those selected under subclause 

7 (I)) for such round; and’’. 

8 (b) REQUIREMENT TO EITHER COMPETITIVELY BID

9 AREAS OR USE COMPETITIVE BID PRICES BY 2016.— 

10 Section 1834(a)(1)(F) of the Social Security Act (42 

11 U.S.C. 1395m(a)(1)(F)) is amended— 

12 (1) in clause (i), by striking ‘‘and’’ at the end; 

13 (2) in clause (ii)— 

14 (A) by inserting ‘‘(and, in the case of cov15 ered items furnished on or after January 1, 

16 2016, subject to clause (iii), shall)’’ after 

17 ‘‘may’’; and 

18 (B) by striking the period at the end and 

19 inserting ‘‘; and’’; and 

20 (3) by adding at the end the following new 

21 clause: 

22 ‘‘(iii) in the case of covered items fur23 nished on or after January 1, 2016, the 

24 Secretary shall continue to make such ad25 justments described in clause (ii) as, under 


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1 such competitive acquisition programs, ad2 ditional covered items are phased in or in3 formation is updated as contracts under 

4 section 1847 are recompeted in accordance 

5 with section 1847(b)(3)(B).’’. 

6 SEC. 6411. EXPANSION OF THE RECOVERY AUDIT CON7 TRACTOR (RAC) PROGRAM. 

8 (a) EXPANSION TO MEDICAID.— 

9 (1) STATE PLAN AMENDMENT.—Section 

10 1902(a)(42) of the Social Security Act (42 U.S.C. 

11 1396a(a)(42)) is amended— 

12 (A) by striking ‘‘that the records’’ and in13 serting ‘‘that— 

14 ‘‘(A) the records’’; 

15 (B) by inserting ‘‘and’’ after the semicolon; 

16 and 

17 (C) by adding at the end the following: 

18 ‘‘(B) not later than December 31, 2010, 

19 the State shall— 

20 ‘‘(i) establish a program under which 

21 the State contracts (consistent with State 

22 law and in the same manner as the Sec23 retary enters into contracts with recovery 

24 audit contractors under section 1893(h), 

25 subject to such exceptions or requirements 


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1 as the Secretary may require for purposes 

2 of this title or a particular State) with 1 

3 or more recovery audit contractors for the 

4 purpose of identifying underpayments and 

5 overpayments and recouping overpayments 

6 under the State plan and under any waiver 

7 of the State plan with respect to all serv8 ices for which payment is made to any en9 tity under such plan or waiver; and 

10 ‘‘(ii) provide assurances satisfactory 

11 to the Secretary that— 

12 ‘‘(I) under such contracts, pay13 ment shall be made to such a con14 tractor only from amounts recovered; 

15 ‘‘(II) from such amounts recov16 ered, payment— 

17 ‘‘(aa) shall be made on a 

18 contingent basis for collecting 

19 overpayments; and 

20 ‘‘(bb) may be made in such 

21 amounts as the State may specify 

22 for identifying underpayments; 

23 ‘‘(III) the State has an adequate 

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1 verse determination made by such 

2 contractors; and 

3 ‘‘(IV) such program is carried 

4 out in accordance with such require5 ments as the Secretary shall specify, 

6 including— 

7 ‘‘(aa) for purposes of section 

8 1903(a)(7), that amounts ex9 pended by the State to carry out 

10 the program shall be considered 

11 amounts expended as necessary 

12 for the proper and efficient ad13 ministration of the State plan or 

14 a waiver of the plan; 

15 ‘‘(bb) that section 1903(d) 

16 shall apply to amounts recovered 

17 under the program; and 

18 ‘‘(cc) that the State and any 

19 such contractors under contract 

20 with the State shall coordinate 

21 such recovery audit efforts with 

22 other contractors or entities per23 forming audits of entities receiv24 ing payments under the State 

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1 cluding efforts with Federal and 

2 State law enforcement with re3 spect to the Department of Jus4 tice, including the Federal Bu5 reau of Investigations, the In6 spector General of the Depart7 ment of Health and Human 

8 Services, and the State medicaid 

9 fraud control unit; and’’. 

10 (2) COORDINATION; REGULATIONS.— 

11 (A) IN GENERAL.—The Secretary of 

12 Health and Human Services, acting through the 

13 Administrator of the Centers for Medicare & 

14 Medicaid Services, shall coordinate the expan15 sion of the Recovery Audit Contractor program 

16 to Medicaid with States, particularly with re17 spect to each State that enters into a contract 

18 with a recovery audit contractor for purposes of 

19 the State’s Medicaid program prior to Decem20 ber 31, 2010. 

21 (B) REGULATIONS.—The Secretary of 

22 Health and Human Services shall promulgate 

23 regulations to carry out this subsection and the 

24 amendments made by this subsection, including 


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1 with respect to conditions of Federal financial 

2 participation, as specified by the Secretary. 

3 (b) EXPANSION TO MEDICARE PARTS C AND D.— 

4 Section 1893(h) of the Social Security Act (42 U.S.C. 

5 1395ddd(h)) is amended— 

6 (1) in paragraph (1), in the matter preceding 

7 subparagraph (A), by striking ‘‘part A or B’’ and in8 serting ‘‘this title’’; 

9 (2) in paragraph (2), by striking ‘‘parts A and 

10 B’’ and inserting ‘‘this title’’; 

11 (3) in paragraph (3), by inserting ‘‘(not later 

12 than December 31, 2010, in the case of contracts re13 lating to payments made under part C or D)’’ after 

14 ‘‘2010’’; 

15 (4) in paragraph (4), in the matter preceding 

16 subparagraph (A), by striking ‘‘part A or B’’ and in17 serting ‘‘this title’’; and 

18 (5) by adding at the end the following: 

19 ‘‘(9) SPECIAL RULES RELATING TO PARTS C

20 AND D.—The Secretary shall enter into contracts 

21 under paragraph (1) to require recovery audit con22 tractors to— 

23 ‘‘(A) ensure that each MA plan under part 

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1 view the effectiveness of each such anti-fraud 

2 plan; 

3 ‘‘(B) ensure that each prescription drug 

4 plan under part D has an anti- fraud plan in 

5 effect and to review the effectiveness of each 

6 such anti-fraud plan; 

7 ‘‘(C) examine claims for reinsurance pay8 ments under section 1860D–15(b) to determine 

9 whether prescription drug plans submitting 

10 such claims incurred costs in excess of the al11 lowable reinsurance costs permitted under para12 graph (2) of that section; and 

13 ‘‘(D) review estimates submitted by pre14 scription drug plans by private plans with re15 spect to the enrollment of high cost bene16 ficiaries (as defined by the Secretary) and to 

17 compare such estimates with the numbers of 

18 such beneficiaries actually enrolled by such 

19 plans.’’. 

20 (c) ANNUAL REPORT.—The Secretary of Health and 

21 Human Services, acting through the Administrator of the 

22 Centers for Medicare & Medicaid Services, shall submit 

23 an annual report to Congress concerning the effectiveness 

24 of the Recovery Audit Contractor program under Medicaid 


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1 and Medicare and shall include such reports recommenda2 tions for expanding or improving the program. 

3 Subtitle F—Additional Medicaid 

4 Program Integrity Provisions 

5 SEC. 6501. TERMINATION OF PROVIDER PARTICIPATION 

6 UNDER MEDICAID IF TERMINATED UNDER 

7 MEDICARE OR OTHER STATE PLAN. 

8 Section 1902(a)(39) of the Social Security Act (42 

9 U.S.C. 42 U.S.C. 1396a(a)) is amended by inserting after 

10 ‘‘1128A,’’ the following: ‘‘terminate the participation of 

11 any individual or entity in such program if (subject to 

12 such exceptions as are permitted with respect to exclusion 

13 under sections 1128(c)(3)(B) and 1128(d)(3)(B)) partici14 pation of such individual or entity is terminated under title 

15 XVIII or any other State plan under this title,’’. 

16 SEC. 6502. MEDICAID EXCLUSION FROM PARTICIPATION 

17 RELATING TO CERTAIN OWNERSHIP, CON18 TROL, AND MANAGEMENT AFFILIATIONS. 

19 Section 1902(a) of the Social Security Act (42 U.S.C. 

20 1396a(a)), as amended by section 6401(b), is amended by 

21 inserting after paragraph (77) the following: 

22 ‘‘(78) provide that the State agency described 

23 in paragraph (9) exclude, with respect to a period, 

24 any individual or entity from participation in the 

25 program under the State plan if such individual or 


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1 entity owns, controls, or manages an entity that (or 

2 if such entity is owned, controlled, or managed by an 

3 individual or entity that)— 

4 ‘‘(A) has unpaid overpayments (as defined 

5 by the Secretary) under this title during such 

6 period determined by the Secretary or the State 

7 agency to be delinquent; 

8 ‘‘(B) is suspended or excluded from par9 ticipation under or whose participation is termi10 nated under this title during such period; or 

11 ‘‘(C) is affiliated with an individual or enti12 ty that has been suspended or excluded from 

13 participation under this title or whose participa14 tion is terminated under this title during such 

15 period;’’. 

16 SEC. 6503. BILLING AGENTS, CLEARINGHOUSES, OR OTHER 

17 ALTERNATE PAYEES REQUIRED TO REG18 ISTER UNDER MEDICAID. 

19 (a) IN GENERAL.—Section 1902(a) of the Social Se20 curity Act (42 U.S.C. 42 U.S.C. 1396a(a)), as amended 

21 by section 6502(a), is amended by inserting after para22 graph (78), the following: 

23 ‘‘(79) provide that any agent, clearinghouse, or 

24 other alternate payee (as defined by the Secretary) 

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1 vider must register with the State and the Secretary 

2 in a form and manner specified by the Secretary;’’. 

3 SEC. 6504. REQUIREMENT TO REPORT EXPANDED SET OF 

4 DATA ELEMENTS UNDER MMIS TO DETECT 

5 FRAUD AND ABUSE. 

6 (a) IN GENERAL.—Section 1903(r)(1)(F) of the So7 cial Security Act (42 U.S.C. 1396b(r)(1)(F)) is amended 

8 by inserting after ‘‘necessary’’ the following: ‘‘and includ9 ing, for data submitted to the Secretary on or after Janu10 ary 1, 2010, data elements from the automated data sys11 tem that the Secretary determines to be necessary for pro12 gram integrity, program oversight, and administration, at 

13 such frequency as the Secretary shall determine’’. 

14 (b) MANAGED CARE ORGANIZATIONS.— 

15 (1) IN GENERAL.—Section 1903(m)(2)(A)(xi) 

16 of the Social Security Act (42 U.S.C. 

17 1396b(m)(2)(A)(xi)) is amended by inserting ‘‘and 

18 for the provision of such data to the State at a fre19 quency and level of detail to be specified by the Sec20 retary’’ after ‘‘patients’’. 

21 (2) EFFECTIVE DATE.—The amendment made 

22 by paragraph (1) shall apply with respect to contract 

23 years beginning on or after January 1, 2010. 


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1 SEC. 6505. PROHIBITION ON PAYMENTS TO INSTITUTIONS 

2 OR ENTITIES LOCATED OUTSIDE OF THE 

3 UNITED STATES. 

4 Section 1902(a) of the Social Security Act (42 U.S.C. 

5 1396b(a)), as amended by section 6503, is amended by 

6 inserting after paragraph (79) the following new para7 graph: 

8 ‘‘(80) provide that the State shall not provide 

9 any payments for items or services provided under 

10 the State plan or under a waiver to any financial in11 stitution or entity located outside of the United 

12 States;’’. 

13 SEC. 6506. OVERPAYMENTS. 

14 (a) EXTENSION OF PERIOD FOR COLLECTION OF

15 OVERPAYMENTS DUE TO FRAUD.— 

16 (1) IN GENERAL.—Section 1903(d)(2) of the 

17 Social Security Act (42 U.S.C. 1396b(d)(2)) is 

18 amended— 

19 (A) in subparagraph (C)— 

20 (i) in the first sentence, by striking 

21 ‘‘60 days’’ and inserting ‘‘1 year’’; and 

22 (ii) in the second sentence, by striking 

23 ‘‘60 days’’ and inserting ‘‘1-year period’’; 

24 and 

25 (B) in subparagraph (D)— 

26 (i) in inserting ‘‘(i)’’ after ‘‘(D)’’; and 


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1 (ii) by adding at the end the fol2 lowing: 

3 ‘‘(ii) In any case where the State is unable to recover 

4 a debt which represents an overpayment (or any portion 

5 thereof) made to a person or other entity due to fraud 

6 within 1 year of discovery because there is not a final de7 termination of the amount of the overpayment under an 

8 administrative or judicial process (as applicable), includ9 ing as a result of a judgment being under appeal, no ad10 justment shall be made in the Federal payment to such 

11 State on account of such overpayment (or portion thereof) 

12 before the date that is 30 days after the date on which 

13 a final judgment (including, if applicable, a final deter14 mination on an appeal) is made.’’. 

15 (2) EFFECTIVE DATE.—The amendments made 

16 by this subsection take effect on the date of enact17 ment of this Act and apply to overpayments discov18 ered on or after that date. 

19 (b) CORRECTIVE ACTION.—The Secretary shall pro20 mulgate regulations that require States to correct Feder21 ally identified claims overpayments, of an ongoing or re22 curring nature, with new Medicaid Management Informa23 tion System (MMIS) edits, audits, or other appropriate 

24 corrective action. 


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1 SEC. 6507. MANDATORY STATE USE OF NATIONAL CORRECT 

2 CODING INITIATIVE. 

3 Section 1903(r) of the Social Security Act (42 U.S.C. 

4 1396b(r)) is amended— 

5 (1) in paragraph (1)(B)— 

6 (A) in clause (ii), by striking ‘‘and’’ at the 

7 end; 

8 (B) in clause (iii), by adding ‘‘and’’ after 

9 the semi-colon; and 

10 (C) by adding at the end the following new 

11 clause: 

12 ‘‘(iv) effective for claims filed on or 

13 after October 1, 2010, incorporate compat14 ible methodologies of the National Correct 

15 Coding Initiative administered by the Sec16 retary (or any successor initiative to pro17 mote correct coding and to control im18 proper coding leading to inappropriate pay19 ment) and such other methodologies of 

20 that Initiative (or such other national cor21 rect coding methodologies) as the Sec22 retary identifies in accordance with para23 graph (4);’’; and 

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

25 paragraph: 


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1 ‘‘(4) For purposes of paragraph (1)(B)(iv), the Sec2 retary shall do the following: 

3 ‘‘(A) Not later than September 1, 2010: 

4 ‘‘(i) Identify those methodologies of the 

5 National Correct Coding Initiative administered 

6 by the Secretary (or any successor initiative to 

7 promote correct coding and to control improper 

8 coding leading to inappropriate payment) which 

9 are compatible to claims filed under this title. 

10 ‘‘(ii) Identify those methodologies of such 

11 Initiative (or such other national correct coding 

12 methodologies) that should be incorporated into 

13 claims filed under this title with respect to 

14 items or services for which States provide med15 ical assistance under this title and no national 

16 correct coding methodologies have been estab17 lished under such Initiative with respect to title 

18 XVIII. 

19 ‘‘(iii) Notify States of— 

20 ‘‘(I) the methodologies identified 

21 under subparagraphs (A) and (B) (and of 

22 any other national correct coding meth23 odologies identified under subparagraph 

24 (B)); and 


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1 ‘‘(II) how States are to incorporate 

2 such methodologies into claims filed under 

3 this title. 

4 ‘‘(B) Not later than March 1, 2011, submit a 

5 report to Congress that includes the notice to States 

6 under clause (iii) of subparagraph (A) and an anal7 ysis supporting the identification of the methodolo8 gies made under clauses (i) and (ii) of subparagraph 

9 (A).’’. 

10 SEC. 6508. GENERAL EFFECTIVE DATE. 

11 (a) IN GENERAL.—Except as otherwise provided in 

12 this subtitle, this subtitle and the amendments made by 

13 this subtitle take effect on January 1, 2011, without re14 gard to whether final regulations to carry out such amend15 ments and subtitle have been promulgated by that date. 

16 (b) DELAY IF STATE LEGISLATION REQUIRED.—In 

17 the case of a State plan for medical assistance under title 

18 XIX of the Social Security Act or a child health plan 

19 under title XXI of such Act which the Secretary of Health 

20 and Human Services determines requires State legislation 

21 (other than legislation appropriating funds) in order for 

22 the plan to meet the additional requirement imposed by 

23 the amendments made by this subtitle, the State plan or 

24 child health plan shall not be regarded as failing to comply 

25 with the requirements of such title solely on the basis of 


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1 its failure to meet this additional requirement before the 

2 first day of the first calendar quarter beginning after the 

3 close of the first regular session of the State legislature 

4 that begins after the date of the enactment of this Act. 

5 For purposes of the previous sentence, in the case of a 

6 State that has a 2-year legislative session, each year of 

7 such session shall be deemed to be a separate regular ses8 sion of the State legislature. 

9 Subtitle G—Additional Program 

10 Integrity Provisions 

11 SEC. 6601. PROHIBITION ON FALSE STATEMENTS AND REP12 RESENTATIONS. 

13 (a) PROHIBITION.—Part 5 of subtitle B of title I of 

14 the Employee Retirement Income Security Act of 1974 

15 (29 U.S.C. 1131 et seq.) is amended by adding at the end 

16 the following: 

17 ‘‘SEC. 519. PROHIBITION ON FALSE STATEMENTS AND REP18 RESENTATIONS. 

19 ‘‘No person, in connection with a plan or other ar20 rangement that is multiple employer welfare arrangement 

21 described in section 3(40), shall make a false statement 

22 or false representation of fact, knowing it to be false, in 

23 connection with the marketing or sale of such plan or ar24 rangement, to any employee, any member of an employee 

25 organization, any beneficiary, any employer, any employee 


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1 organization, the Secretary, or any State, or the represent2 ative or agent of any such person, State, or the Secretary, 

3 concerning— 

4 ‘‘(1) the financial condition or solvency of such 

5 plan or arrangement; 

6 ‘‘(2) the benefits provided by such plan or ar7 rangement; 

8 ‘‘(3) the regulatory status of such plan or other 

9 arrangement under any Federal or State law gov10 erning collective bargaining, labor management rela11 tions, or intern union affairs; or 

12 ‘‘(4) the regulatory status of such plan or other 

13 arrangement regarding exemption from state regu14 latory authority under this Act. 

15 This section shall not apply to any plan or arrangement 

16 that does not fall within the meaning of the term ‘multiple 

17 employer welfare arrangement’ under section 3(40)(A).’’. 

18 (b) CRIMINAL PENALTIES.—Section 501 of the Em19 ployee Retirement Income Security Act of 1974 (29 

20 U.S.C. 1131) is amended— 

21 (1) by inserting ‘‘(a)’’ before ‘‘Any person’’; and 

22 (2) by adding at the end the following: 

23 ‘‘(b) Any person that violates section 519 shall upon 

24 conviction be imprisoned not more than 10 years or fined 

25 under title 18, United States Code, or both.’’. 


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1 (c) CONFORMING AMENDMENT.—The table of sec2 tions for part 5 of subtitle B of title I of the Employee 

3 Retirement Income Security Act of 1974 is amended by 

4 adding at the end the following: 

‘‘Sec. 519. Prohibition on false statement and representations.’’. 

5 SEC. 6602. CLARIFYING DEFINITION. 

6 Section 24(a)(2) of title 18, United States Code, is 

7 amended by inserting ‘‘or section 411, 518, or 511 of the 

8 Employee Retirement Income Security Act of 1974,’’ after 

9 ‘‘1954 of this title’’. 

10 SEC. 6603. DEVELOPMENT OF MODEL UNIFORM REPORT 

11 FORM. 

12 Part C of title XXVII of the Public Health Service 

13 Act (42 U.S.C. 300gg-91 et seq.) is amended by adding 

14 at the end the following: 

15 ‘‘SEC. 2794. UNIFORM FRAUD AND ABUSE REFERRAL FOR16 MAT. 

17 ‘‘The Secretary shall request the National Associa18 tion of Insurance Commissioners to develop a model uni19 form report form for private health insurance issuer seek20 ing to refer suspected fraud and abuse to State insurance 

21 departments or other responsible State agencies for inves22 tigation. The Secretary shall request that the National As23 sociation of Insurance Commissioners develop rec24 ommendations for uniform reporting standards for such 

25 referrals.’’. 


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1 SEC. 6604. APPLICABILITY OF STATE LAW TO COMBAT 

2 FRAUD AND ABUSE. 

3 (a) IN GENERAL.—Part 5 of subtitle B of title I of 

4 the Employee Retirement Income Security Act of 1974 

5 (29 U.S.C. 1131 et seq.), as amended by section 6601, 

6 is further amended by adding at the end the following: 

7 ‘‘SEC. 520. APPLICABILITY OF STATE LAW TO COMBAT 

8 FRAUD AND ABUSE. 

9 ‘‘The Secretary may, for the purpose of identifying, 

10 preventing, or prosecuting fraud and abuse, adopt regu11 latory standards establishing, or issue an order relating 

12 to a specific person establishing, that a person engaged 

13 in the business of providing insurance through a multiple 

14 employer welfare arrangement described in section 3(40) 

15 is subject to the laws of the States in which such person 

16 operates which regulate insurance in such State, notwith17 standing section 514(b)(6) of this Act or the Liability Risk 

18 Retention Act of 1986, and regardless of whether the law 

19 of the State is otherwise preempted under any of such pro20 visions. This section shall not apply to any plan or ar21 rangement that does not fall within the meaning of the 

22 term ‘multiple employer welfare arrangement’ under sec23 tion 3(40(A).’’. 

24 (b) CONFORMING AMENDMENT.—The table of sec25 tions for part 5 of subtitle B of title I of the Employee 

26 Retirement Income Security Act of 1974, as amended by 


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1 section 6601, is further amended by adding at the end 

2 the following: 

‘‘Sec. 520. Applicability of State law to combat fraud and abuse.’’. 

3 SEC. 6605. ENABLING THE DEPARTMENT OF LABOR TO 

4 ISSUE ADMINISTRATIVE SUMMARY CEASE 

5 AND DESIST ORDERS AND SUMMARY SEI6 ZURES ORDERS AGAINST PLANS THAT ARE IN 

7 FINANCIALLY HAZARDOUS CONDITION. 

8 (a) IN GENERAL.—Part 5 of subtitle B of title I of 

9 the Employee Retirement Income Security Act of 1974 

10 (29 U.S.C. 1131 et seq.), as amended by section 6604, 

11 is further amended by adding at the end the following: 

12 ‘‘SEC. 521. ADMINISTRATIVE SUMMARY CEASE AND DESIST 

13 ORDERS AND SUMMARY SEIZURE ORDERS 

14 AGAINST MULTIPLE EMPLOYER WELFARE 

15 ARRANGEMENTS IN FINANCIALLY HAZ16 ARDOUS CONDITION. 

17 ‘‘(a) IN GENERAL.—The Secretary may issue a cease 

18 and desist (ex parte) order under this title if it appears 

19 to the Secretary that the alleged conduct of a multiple em20 ployer welfare arrangement described in section 3(40), 

21 other than a plan or arrangement described in subsection 

22 (g), is fraudulent, or creates an immediate danger to the 

23 public safety or welfare, or is causing or can be reasonably 

24 expected to cause significant, imminent, and irreparable 

25 public injury. 


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1 ‘‘(b) HEARING.—A person that is adversely affected 

2 by the issuance of a cease and desist order under sub3 section (a) may request a hearing by the Secretary regard4 ing such order. The Secretary may require that a pro5 ceeding under this section, including all related informa6 tion and evidence, be conducted in a confidential manner. 

7 ‘‘(c) BURDEN OF PROOF.—The burden of proof in 

8 any hearing conducted under subsection (b) shall be on 

9 the party requesting the hearing to show cause why the 

10 cease and desist order should be set aside. 

11 ‘‘(d) DETERMINATION.—Based upon the evidence 

12 presented at a hearing under subsection (b), the cease and 

13 desist order involved may be affirmed, modified, or set 

14 aside by the Secretary in whole or in part. 

15 ‘‘(e) SEIZURE.—The Secretary may issue a summary 

16 seizure order under this title if it appears that a multiple 

17 employer welfare arrangement is in a financially haz18 ardous condition. 

19 ‘‘(f) REGULATIONS.—The Secretary may promulgate 

20 such regulations or other guidance as may be necessary 

21 or appropriate to carry out this section. 

22 ‘‘(g) EXCEPTION.—This section shall not apply to 

23 any plan or arrangement that does not fall within the 

24 meaning of the term ‘multiple employer welfare arrange25 ment’ under section 3(40(A).’’. 


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1 (b) CONFORMING AMENDMENT.—The table of sec2 tions for part 5 of subtitle B of title I of the Employee 

3 Retirement Income Security Act of 1974, as amended by 

4 section 6604, is further amended by adding at the end 

5 the following: 

‘‘Sec. 521. Administrative summary cease and desist orders and summary seizure orders against health plans in financially hazardous condition.’’. 

6 SEC. 6606. MEWA PLAN REGISTRATION WITH DEPARTMENT 

7 OF LABOR. 

8 Section 101(g) of the Employee Retirement Income 

9 Security Act of 1974 (29 U.S.C. 1021(g)) is amended— 

10 (1) by striking ‘‘Secretary may’’ and inserting 

11 ‘‘Secretary shall’’; and 

12 (2) by inserting ‘‘to register with the Secretary 

13 prior to operating in a State and may, by regulation, 

14 require such multiple employer welfare arrange15 ments’’ after ‘‘not group health plans’’. 

16 SEC. 6607. PERMITTING EVIDENTIARY PRIVILEGE AND 

17 CONFIDENTIAL COMMUNICATIONS. 

18 Section 504 of the Employee Retirement Income Se19 curity Act of 1974 (29 U.S.C. 1134) is amended by adding 

20 at the end the following: 

21 ‘‘(d) The Secretary may promulgate a regulation that 

22 provides an evidentiary privilege for, and provides for the 

23 confidentiality of communications between or among, any 


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1 of the following entities or their agents, consultants, or 

2 employees: 

3 ‘‘(1) A State insurance department. 

4 ‘‘(2) A State attorney general. 

5 ‘‘(3) The National Association of Insurance 

6 Commissioners. 

7 ‘‘(4) The Department of Labor. 

8 ‘‘(5) The Department of the Treasury. 

9 ‘‘(6) The Department of Justice. 

10 ‘‘(7) The Department of Health and Human 

11 Services. 

12 ‘‘(8) Any other Federal or State authority that 

13 the Secretary determines is appropriate for the pur14 poses of enforcing the provisions of this title. 

15 ‘‘(e) The privilege established under subsection (d) 

16 shall apply to communications related to any investigation, 

17 audit, examination, or inquiry conducted or coordinated 

18 by any of the agencies. A communication that is privileged 

19 under subsection (d) shall not waive any privilege other20 wise available to the communicating agency or to any per21 son who provided the information that is communicated.’’. 

22 Subtitle H—Elder Justice Act 

23 SEC. 6701. SHORT TITLE OF SUBTITLE. 

24 This subtitle may be cited as the ‘‘Elder Justice Act 

25 of 2009’’. 


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1 SEC. 6702. DEFINITIONS. 

2 Except as otherwise specifically provided, any term 

3 that is defined in section 2011 of the Social Security Act 

4 (as added by section 6703(a)) and is used in this subtitle 

5 has the meaning given such term by such section. 

6 SEC. 6703. ELDER JUSTICE. 

7 (a) ELDER JUSTICE.— 

8 (1) IN GENERAL.—Title XX of the Social Secu9 rity Act (42 U.S.C. 1397 et seq.) is amended— 

10 (A) in the heading, by inserting ‘‘AND 

11 ELDER JUSTICE’’ after ‘‘SOCIAL 

12 SERVICES’’; 

13 (B) by inserting before section 2001 the 

14 following: 

15 ‘‘Subtitle A—Block Grants to States 

16 for Social Services’’; 

17 and 

18 (C) by adding at the end the following: 

19 ‘‘Subtitle B—Elder Justice 

20 ‘‘SEC. 2011. DEFINITIONS. 

21 ‘‘In this subtitle: 

22 ‘‘(1) ABUSE.—The term ‘abuse’ means the 

23 knowing infliction of physical or psychological harm 

24 or the knowing deprivation of goods or services that 

25 are necessary to meet essential needs or to avoid 

26 physical or psychological harm. 


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1 ‘‘(2) ADULT PROTECTIVE SERVICES.—The term 

2 ‘adult protective services’ means such services pro3 vided to adults as the Secretary may specify and in4 cludes services such as— 

5 ‘‘(A) receiving reports of adult abuse, ne6 glect, or exploitation; 

7 ‘‘(B) investigating the reports described in 

8 subparagraph (A); 

9 ‘‘(C) case planning, monitoring, evaluation, 

10 and other case work and services; and 

11 ‘‘(D) providing, arranging for, or facili12 tating the provision of medical, social service, 

13 economic, legal, housing, law enforcement, or 

14 other protective, emergency, or support services. 

15 ‘‘(3) CAREGIVER.—The term ‘caregiver’ means 

16 an individual who has the responsibility for the care 

17 of an elder, either voluntarily, by contract, by receipt 

18 of payment for care, or as a result of the operation 

19 of law, and means a family member or other indi20 vidual who provides (on behalf of such individual or 

21 of a public or private agency, organization, or insti22 tution) compensated or uncompensated care to an 

23 elder who needs supportive services in any setting. 

24 ‘‘(4) DIRECT CARE.—The term ‘direct care’ 

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1 vides assistance or long-term care services to a re2 cipient. 

3 ‘‘(5) ELDER.—The term ‘elder’ means an indi4 vidual age 60 or older. 

5 ‘‘(6) ELDER JUSTICE.—The term ‘elder justice’ 

6 means— 

7 ‘‘(A) from a societal perspective, efforts 

8 to— 

9 ‘‘(i) prevent, detect, treat, intervene 

10 in, and prosecute elder abuse, neglect, and 

11 exploitation; and 

12 ‘‘(ii) protect elders with diminished 

13 capacity while maximizing their autonomy; 

14 and 

15 ‘‘(B) from an individual perspective, the 

16 recognition of an elder’s rights, including the 

17 right to be free of abuse, neglect, and exploi18 tation. 

19 ‘‘(7) ELIGIBLE ENTITY.—The term ‘eligible en20 tity’ means a State or local government agency, In21 dian tribe or tribal organization, or any other public 

22 or private entity that is engaged in and has expertise 

23 in issues relating to elder justice or in a field nec24 essary to promote elder justice efforts. 


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1 ‘‘(8) EXPLOITATION.—The term ‘exploitation’ 

2 means the fraudulent or otherwise illegal, unauthor3 ized, or improper act or process of an individual, in4 cluding a caregiver or fiduciary, that uses the re5 sources of an elder for monetary or personal benefit, 

6 profit, or gain, or that results in depriving an elder 

7 of rightful access to, or use of, benefits, resources, 

8 belongings, or assets. 

9 ‘‘(9) FIDUCIARY.—The term ‘fiduciary’— 

10 ‘‘(A) means a person or entity with the 

11 legal responsibility— 

12 ‘‘(i) to make decisions on behalf of 

13 and for the benefit of another person; and 

14 ‘‘(ii) to act in good faith and with 

15 fairness; and 

16 ‘‘(B) includes a trustee, a guardian, a con17 servator, an executor, an agent under a finan18 cial power of attorney or health care power of 

19 attorney, or a representative payee. 

20 ‘‘(10) GRANT.—The term ‘grant’ includes a 

21 contract, cooperative agreement, or other mechanism 

22 for providing financial assistance. 

23 ‘‘(11) GUARDIANSHIP.—The term ‘guardian24 ship’ means— 


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1 ‘‘(A) the process by which a State court 

2 determines that an adult individual lacks capac3 ity to make decisions about self-care or prop4 erty, and appoints another individual or entity 

5 known as a guardian, as a conservator, or by a 

6 similar term, as a surrogate decisionmaker; 

7 ‘‘(B) the manner in which the court-ap8 pointed surrogate decisionmaker carries out du9 ties to the individual and the court; or 

10 ‘‘(C) the manner in which the court exer11 cises oversight of the surrogate decisionmaker. 

12 ‘‘(12) INDIAN TRIBE.— 

13 ‘‘(A) IN GENERAL.—The term ‘Indian 

14 tribe’ has the meaning given such term in sec15 tion 4 of the Indian Self-Determination and 

16 Education Assistance Act (25 U.S.C. 450b). 

17 ‘‘(B) INCLUSION OF PUEBLO AND

18 RANCHERIA.—The term ‘Indian tribe’ includes 

19 any Pueblo or Rancheria. 

20 ‘‘(13) LAW ENFORCEMENT.—The term ‘law en21 forcement’ means the full range of potential re22 sponders to elder abuse, neglect, and exploitation in23 cluding— 

24 ‘‘(A) police, sheriffs, detectives, public safe25 ty officers, and corrections personnel; 


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1 ‘‘(B) prosecutors; 

2 ‘‘(C) medical examiners; 

3 ‘‘(D) investigators; and 

4 ‘‘(E) coroners. 

5 ‘‘(14) LONG-TERM CARE.— 

6 ‘‘(A) IN GENERAL.—The term ‘long-term 

7 care’ means supportive and health services spec8 ified by the Secretary for individuals who need 

9 assistance because the individuals have a loss of 

10 capacity for self-care due to illness, disability, 

11 or vulnerability. 

12 ‘‘(B) LOSS OF CAPACITY FOR SELF13 CARE.—For purposes of subparagraph (A), the 

14 term ‘loss of capacity for self-care’ means an in15 ability to engage in 1 or more activities of daily 

16 living, including eating, dressing, bathing, man17 agement of one’s financial affairs, and other ac18 tivities the Secretary determines appropriate. 

19 ‘‘(15) LONG-TERM CARE FACILITY.—The term 

20 ‘long-term care facility’ means a residential care pro21 vider that arranges for, or directly provides, long22 term care. 

23 ‘‘(16) NEGLECT.—The term ‘neglect’ means— 

24 ‘‘(A) the failure of a caregiver or fiduciary 

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1 essary to maintain the health or safety of an 

2 elder; or 

3 ‘‘(B) self-neglect. 

4 ‘‘(17) NURSING FACILITY.— 

5 ‘‘(A) IN GENERAL.—The term ‘nursing fa6 cility’ has the meaning given such term under 

7 section 1919(a). 

8 ‘‘(B) INCLUSION OF SKILLED NURSING FA9 CILITY.—The term ‘nursing facility’ includes a 

10 skilled nursing facility (as defined in section 

11 1819(a)). 

12 ‘‘(18) SELF-NEGLECT.—The term ‘self-neglect’ 

13 means an adult’s inability, due to physical or mental 

14 impairment or diminished capacity, to perform es15 sential self-care tasks including— 

16 ‘‘(A) obtaining essential food, clothing, 

17 shelter, and medical care; 

18 ‘‘(B) obtaining goods and services nec19 essary to maintain physical health, mental 

20 health, or general safety; or 

21 ‘‘(C) managing one’s own financial affairs. 

22 ‘‘(19) SERIOUS BODILY INJURY.— 

23 ‘‘(A) IN GENERAL.—The term ‘serious 

24 bodily injury’ means an injury— 

25 ‘‘(i) involving extreme physical pain; 


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1 ‘‘(ii) involving substantial risk of 

2 death; 

3 ‘‘(iii) involving protracted loss or im4 pairment of the function of a bodily mem5 ber, organ, or mental faculty; or 

6 ‘‘(iv) requiring medical intervention 

7 such as surgery, hospitalization, or phys8 ical rehabilitation. 

9 ‘‘(B) CRIMINAL SEXUAL ABUSE.—Serious 

10 bodily injury shall be considered to have oc11 curred if the conduct causing the injury is con12 duct described in section 2241 (relating to ag13 gravated sexual abuse) or 2242 (relating to sex14 ual abuse) of title 18, United States Code, or 

15 any similar offense under State law. 

16 ‘‘(20) SOCIAL.—The term ‘social’, when used 

17 with respect to a service, includes adult protective 

18 services. 

19 ‘‘(21) STATE LEGAL ASSISTANCE DEVEL20 OPER.—The term ‘State legal assistance developer’ 

21 means an individual described in section 731 of the 

22 Older Americans Act of 1965. 

23 ‘‘(22) STATE LONG-TERM CARE OMBUDSMAN.— 

24 The term ‘State Long-Term Care Ombudsman’ 

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1 scribed in section 712(a)(2) of the Older Americans 

2 Act of 1965. 

3 ‘‘SEC. 2012. GENERAL PROVISIONS. 

4 ‘‘(a) PROTECTION OF PRIVACY.—In pursuing activi5 ties under this subtitle, the Secretary shall ensure the pro6 tection of individual health privacy consistent with the reg7 ulations promulgated under section 264(c) of the Health 

8 Insurance Portability and Accountability Act of 1996 and 

9 applicable State and local privacy regulations. 

10 ‘‘(b) RULE OF CONSTRUCTION.—Nothing in this sub11 title shall be construed to interfere with or abridge an el12 der’s right to practice his or her religion through reliance 

13 on prayer alone for healing when this choice— 

14 ‘‘(1) is contemporaneously expressed, either 

15 orally or in writing, with respect to a specific illness 

16 or injury which the elder has at the time of the deci17 sion by an elder who is competent at the time of the 

18 decision; 

19 ‘‘(2) is previously set forth in a living will, 

20 health care proxy, or other advance directive docu21 ment that is validly executed and applied under 

22 State law; or 

23 ‘‘(3) may be unambiguously deduced from the 

24 elder’s life history. 


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1 ‘‘PART I—NATIONAL COORDINATION OF ELDER 

2 JUSTICE ACTIVITIES AND RESEARCH 

3 ‘‘Subpart A—Elder Justice Coordinating Council and 

4 Advisory Board on Elder Abuse, Neglect, and Ex5 ploitation 

6 ‘‘SEC. 2021. ELDER JUSTICE COORDINATING COUNCIL. 

7 ‘‘(a) ESTABLISHMENT.—There is established within 

8 the Office of the Secretary an Elder Justice Coordinating 

9 Council (in this section referred to as the ‘Council’). 

10 ‘‘(b) MEMBERSHIP.— 

11 ‘‘(1) IN GENERAL.—The Council shall be com12 posed of the following members: 

13 ‘‘(A) The Secretary (or the Secretary’s 

14 designee). 

15 ‘‘(B) The Attorney General (or the Attor16 ney General’s designee). 

17 ‘‘(C) The head of each Federal department 

18 or agency or other governmental entity identi19 fied by the Chair referred to in subsection (d) 

20 as having responsibilities, or administering pro21 grams, relating to elder abuse, neglect, and ex22 ploitation. 

23 ‘‘(2) REQUIREMENT.—Each member of the 

24 Council shall be an officer or employee of the Fed25 eral Government. 


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1 ‘‘(c) VACANCIES.—Any vacancy in the Council shall 

2 not affect its powers, but shall be filled in the same man3 ner as the original appointment was made. 

4 ‘‘(d) CHAIR.—The member described in subsection 

5 (b)(1)(A) shall be Chair of the Council. 

6 ‘‘(e) MEETINGS.—The Council shall meet at least 2 

7 times per year, as determined by the Chair. 

8 ‘‘(f) DUTIES.— 

9 ‘‘(1) IN GENERAL.—The Council shall make 

10 recommendations to the Secretary for the coordina11 tion of activities of the Department of Health and 

12 Human Services, the Department of Justice, and 

13 other relevant Federal, State, local, and private 

14 agencies and entities, relating to elder abuse, ne15 glect, and exploitation and other crimes against el16 ders. 

17 ‘‘(2) REPORT.—Not later than the date that is 

18 2 years after the date of enactment of the Elder 

19 Justice Act of 2009 and every 2 years thereafter, 

20 the Council shall submit to the Committee on Fi21 nance of the Senate and the Committee on Ways 

22 and Means and the Committee on Energy and Com23 merce of the House of Representatives a report 

24 that— 


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1 ‘‘(A) describes the activities and accom2 plishments of, and challenges faced by— 

3 ‘‘(i) the Council; and 

4 ‘‘(ii) the entities represented on the 

5 Council; and 

6 ‘‘(B) makes such recommendations for leg7 islation, model laws, or other action as the 

8 Council determines to be appropriate. 

9 ‘‘(g) POWERS OF THE COUNCIL.— 

10 ‘‘(1) INFORMATION FROM FEDERAL AGEN11 CIES.—Subject to the requirements of section 

12 2012(a), the Council may secure directly from any 

13 Federal department or agency such information as 

14 the Council considers necessary to carry out this sec15 tion. Upon request of the Chair of the Council, the 

16 head of such department or agency shall furnish 

17 such information to the Council. 

18 ‘‘(2) POSTAL SERVICES.—The Council may use 

19 the United States mails in the same manner and 

20 under the same conditions as other departments and 

21 agencies of the Federal Government. 

22 ‘‘(h) TRAVEL EXPENSES.—The members of the 

23 Council shall not receive compensation for the perform24 ance of services for the Council. The members shall be 

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1 sistence, at rates authorized for employees of agencies 

2 under subchapter I of chapter 57 of title 5, United States 

3 Code, while away from their homes or regular places of 

4 business in the performance of services for the Council. 

5 Notwithstanding section 1342 of title 31, United States 

6 Code, the Secretary may accept the voluntary and uncom7 pensated services of the members of the Council. 

8 ‘‘(i) DETAIL OF GOVERNMENT EMPLOYEES.—Any 

9 Federal Government employee may be detailed to the 

10 Council without reimbursement, and such detail shall be 

11 without interruption or loss of civil service status or privi12 lege. 

13 ‘‘(j) STATUS AS PERMANENT COUNCIL.—Section 14 

14 of the Federal Advisory Committee Act (5 U.S.C. App.) 

15 shall not apply to the Council. 

16 ‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated such sums as are nec18 essary to carry out this section. 

19 ‘‘SEC. 2022. ADVISORY BOARD ON ELDER ABUSE, NEGLECT, 

20 AND EXPLOITATION. 

21 ‘‘(a) ESTABLISHMENT.—There is established a board 

22 to be known as the ‘Advisory Board on Elder Abuse, Ne23 glect, and Exploitation’ (in this section referred to as the 

24 ‘Advisory Board’) to create short- and long-term multi25 disciplinary strategic plans for the development of the field 


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1 of elder justice and to make recommendations to the Elder 

2 Justice Coordinating Council established under section 

3 2021. 

4 ‘‘(b) COMPOSITION.—The Advisory Board shall be 

5 composed of 27 members appointed by the Secretary from 

6 among members of the general public who are individuals 

7 with experience and expertise in elder abuse, neglect, and 

8 exploitation prevention, detection, treatment, intervention, 

9 or prosecution. 

10 ‘‘(c) SOLICITATION OF NOMINATIONS.—The Sec11 retary shall publish a notice in the Federal Register solic12 iting nominations for the appointment of members of the 

13 Advisory Board under subsection (b). 

14 ‘‘(d) TERMS.— 

15 ‘‘(1) IN GENERAL.—Each member of the Advi16 sory Board shall be appointed for a term of 3 years, 

17 except that, of the members first appointed— 

18 ‘‘(A) 9 shall be appointed for a term of 3 

19 years; 

20 ‘‘(B) 9 shall be appointed for a term of 2 

21 years; and 

22 ‘‘(C) 9 shall be appointed for a term of 1 

23 year. 

24 ‘‘(2) VACANCIES.— 


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1 ‘‘(A) IN GENERAL.—Any vacancy on the 

2 Advisory Board shall not affect its powers, but 

3 shall be filled in the same manner as the origi4 nal appointment was made. 

5 ‘‘(B) FILLING UNEXPIRED TERM.—An in6 dividual chosen to fill a vacancy shall be ap7 pointed for the unexpired term of the member 

8 replaced. 

9 ‘‘(3) EXPIRATION OF TERMS.—The term of any 

10 member shall not expire before the date on which 

11 the member’s successor takes office. 

12 ‘‘(e) ELECTION OF OFFICERS.—The Advisory Board 

13 shall elect a Chair and Vice Chair from among its mem14 bers. The Advisory Board shall elect its initial Chair and 

15 Vice Chair at its initial meeting. 

16 ‘‘(f) DUTIES.— 

17 ‘‘(1) ENHANCE COMMUNICATION ON PRO18 MOTING QUALITY OF, AND PREVENTING ABUSE, NE19 GLECT, AND EXPLOITATION IN, LONG-TERM CARE.— 

20 The Advisory Board shall develop collaborative and 

21 innovative approaches to improve the quality of, in22 cluding preventing abuse, neglect, and exploitation 

23 in, long-term care. 


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1 ‘‘(2) COLLABORATIVE EFFORTS TO DEVELOP

2 CONSENSUS AROUND THE MANAGEMENT OF CER3 TAIN QUALITY-RELATED FACTORS.— 

4 ‘‘(A) IN GENERAL.—The Advisory Board 

5 shall establish multidisciplinary panels to ad6 dress, and develop consensus on, subjects relat7 ing to improving the quality of long-term care. 

8 At least 1 such panel shall address, and develop 

9 consensus on, methods for managing resident10 to-resident abuse in long-term care. 

11 ‘‘(B) ACTIVITIES CONDUCTED.—The multi12 disciplinary panels established under subpara13 graph (A) shall examine relevant research and 

14 data, identify best practices with respect to the 

15 subject of the panel, determine the best way to 

16 carry out those best practices in a practical and 

17 feasible manner, and determine an effective 

18 manner of distributing information on such 

19 subject. 

20 ‘‘(3) REPORT.—Not later than the date that is 

21 18 months after the date of enactment of the Elder 

22 Justice Act of 2009, and annually thereafter, the 

23 Advisory Board shall prepare and submit to the 

24 Elder Justice Coordinating Council, the Committee 

25 on Finance of the Senate, and the Committee on 


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1 Ways and Means and the Committee on Energy and 

2 Commerce of the House of Representatives a report 

3 containing— 

4 ‘‘(A) information on the status of Federal, 

5 State, and local public and private elder justice 

6 activities; 

7 ‘‘(B) recommendations (including rec8 ommended priorities) regarding— 

9 ‘‘(i) elder justice programs, research, 

10 training, services, practice, enforcement, 

11 and coordination; 

12 ‘‘(ii) coordination between entities 

13 pursuing elder justice efforts and those in14 volved in related areas that may inform or 

15 overlap with elder justice efforts, such as 

16 activities to combat violence against women 

17 and child abuse and neglect; and 

18 ‘‘(iii) activities relating to adult fidu19 ciary systems, including guardianship and 

20 other fiduciary arrangements; 

21 ‘‘(C) recommendations for specific modi22 fications needed in Federal and State laws (in23 cluding regulations) or for programs, research, 

24 and training to enhance prevention, detection, 

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1 vention in (including investigation of), and 

2 prosecution of elder abuse, neglect, and exploi3 tation; 

4 ‘‘(D) recommendations on methods for the 

5 most effective coordinated national data collec6 tion with respect to elder justice, and elder 

7 abuse, neglect, and exploitation; and 

8 ‘‘(E) recommendations for a multidisci9 plinary strategic plan to guide the effective and 

10 efficient development of the field of elder jus11 tice. 

12 ‘‘(g) POWERS OF THE ADVISORY BOARD.— 

13 ‘‘(1) INFORMATION FROM FEDERAL AGEN14 CIES.—Subject to the requirements of section 

15 2012(a), the Advisory Board may secure directly 

16 from any Federal department or agency such infor17 mation as the Advisory Board considers necessary to 

18 carry out this section. Upon request of the Chair of 

19 the Advisory Board, the head of such department or 

20 agency shall furnish such information to the Advi21 sory Board. 

22 ‘‘(2) SHARING OF DATA AND REPORTS.—The 

23 Advisory Board may request from any entity pur24 suing elder justice activities under the Elder Justice 

25 Act of 2009 or an amendment made by that Act, 


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1 any data, reports, or recommendations generated in 

2 connection with such activities. 

3 ‘‘(3) POSTAL SERVICES.—The Advisory Board 

4 may use the United States mails in the same man5 ner and under the same conditions as other depart6 ments and agencies of the Federal Government. 

7 ‘‘(h) TRAVEL EXPENSES.—The members of the Advi8 sory Board shall not receive compensation for the perform9 ance of services for the Advisory Board. The members 

10 shall be allowed travel expenses for up to 4 meetings per 

11 year, including per diem in lieu of subsistence, at rates 

12 authorized for employees of agencies under subchapter I 

13 of chapter 57 of title 5, United States Code, while away 

14 from their homes or regular places of business in the per15 formance of services for the Advisory Board. Notwith16 standing section 1342 of title 31, United States Code, the 

17 Secretary may accept the voluntary and uncompensated 

18 services of the members of the Advisory Board. 

19 ‘‘(i) DETAIL OF GOVERNMENT EMPLOYEES.—Any 

20 Federal Government employee may be detailed to the Ad21 visory Board without reimbursement, and such detail shall 

22 be without interruption or loss of civil service status or 

23 privilege. 


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1 ‘‘(j) STATUS AS PERMANENT ADVISORY COM2 MITTEE.—Section 14 of the Federal Advisory Committee 

3 Act (5 U.S.C. App.) shall not apply to the advisory board. 

4 ‘‘(k) AUTHORIZATION OF APPROPRIATIONS.—There 

5 are authorized to be appropriated such sums as are nec6 essary to carry out this section. 

7 ‘‘SEC. 2023. RESEARCH PROTECTIONS. 

8 ‘‘(a) GUIDELINES.—The Secretary shall promulgate 

9 guidelines to assist researchers working in the area of 

10 elder abuse, neglect, and exploitation, with issues relating 

11 to human subject protections. 

12 ‘‘(b) DEFINITION OF LEGALLY AUTHORIZED REP13 RESENTATIVE FOR APPLICATION OF REGULATIONS.—For 

14 purposes of the application of subpart A of part 46 of title 

15 45, Code of Federal Regulations, to research conducted 

16 under this subpart, the term ‘legally authorized represent17 ative’ means, unless otherwise provided by law, the indi18 vidual or judicial or other body authorized under the appli19 cable law to consent to medical treatment on behalf of an20 other person. 

21 ‘‘SEC. 2024. AUTHORIZATION OF APPROPRIATIONS. 

22 ‘‘There are authorized to be appropriated to carry out 

23 this subpart— 

24 ‘‘(1) for fiscal year 2011, $6,500,000; and 


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1 ‘‘(2) for each of fiscal years 2012 through 

2 2014, $7,000,000. 

3 ‘‘Subpart B—Elder Abuse, Neglect, and Exploitation 

4 Forensic Centers 

5 ‘‘SEC. 2031. ESTABLISHMENT AND SUPPORT OF ELDER 

6 ABUSE, NEGLECT, AND EXPLOITATION FO7 RENSIC CENTERS. 

8 ‘‘(a) IN GENERAL.—The Secretary, in consultation 

9 with the Attorney General, shall make grants to eligible 

10 entities to establish and operate stationary and mobile fo11 rensic centers, to develop forensic expertise regarding, and 

12 provide services relating to, elder abuse, neglect, and ex13 ploitation. 

14 ‘‘(b) STATIONARY FORENSIC CENTERS.—The Sec15 retary shall make 4 of the grants described in subsection 

16 (a) to institutions of higher education with demonstrated 

17 expertise in forensics or commitment to preventing or 

18 treating elder abuse, neglect, or exploitation, to establish 

19 and operate stationary forensic centers. 

20 ‘‘(c) MOBILE CENTERS.—The Secretary shall make 

21 6 of the grants described in subsection (a) to appropriate 

22 entities to establish and operate mobile forensic centers. 

23 ‘‘(d) AUTHORIZED ACTIVITIES.— 

24 ‘‘(1) DEVELOPMENT OF FORENSIC MARKERS

25 AND METHODOLOGIES.—An eligible entity that reVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01819 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ceives a grant under this section shall use funds 

2 made available through the grant to assist in deter3 mining whether abuse, neglect, or exploitation oc4 curred and whether a crime was committed and to 

5 conduct research to describe and disseminate infor6 mation on— 

7 ‘‘(A) forensic markers that indicate a case 

8 in which elder abuse, neglect, or exploitation 

9 may have occurred; and 

10 ‘‘(B) methodologies for determining, in 

11 such a case, when and how health care, emer12 gency service, social and protective services, and 

13 legal service providers should intervene and 

14 when the providers should report the case to 

15 law enforcement authorities. 

16 ‘‘(2) DEVELOPMENT OF FORENSIC EXPER17 TISE.—An eligible entity that receives a grant under 

18 this section shall use funds made available through 

19 the grant to develop forensic expertise regarding 

20 elder abuse, neglect, and exploitation in order to 

21 provide medical and forensic evaluation, therapeutic 

22 intervention, victim support and advocacy, case re23 view, and case tracking. 

24 ‘‘(3) COLLECTION OF EVIDENCE.—The Sec25 retary, in coordination with the Attorney General, 


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1 shall use data made available by grant recipients 

2 under this section to develop the capacity of geriatric 

3 health care professionals and law enforcement to col4 lect forensic evidence, including collecting forensic 

5 evidence relating to a potential determination of 

6 elder abuse, neglect, or exploitation. 

7 ‘‘(e) APPLICATION.—To be eligible to receive a grant 

8 under this section, an entity shall submit an application 

9 to the Secretary at such time, in such manner, and con10 taining such information as the Secretary may require. 

11 ‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—There 

12 are authorized to be appropriated to carry out this sec13 tion— 

14 ‘‘(1) for fiscal year 2011, $4,000,000; 

15 ‘‘(2) for fiscal year 2012, $6,000,000; and 

16 ‘‘(3) for each of fiscal years 2013 and 2014, 

17 $8,000,000. 

18 ‘‘PART II—PROGRAMS TO PROMOTE ELDER 

19 JUSTICE 

20 ‘‘SEC. 2041. ENHANCEMENT OF LONG-TERM CARE. 

21 ‘‘(a) GRANTS AND INCENTIVES FOR LONG-TERM

22 CARE STAFFING.— 

23 ‘‘(1) IN GENERAL.—The Secretary shall carry 

24 out activities, including activities described in para25 graphs (2) and (3), to provide incentives for individVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01821 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 uals to train for, seek, and maintain employment 

2 providing direct care in long-term care. 

3 ‘‘(2) SPECIFIC PROGRAMS TO ENHANCE TRAIN4 ING, RECRUITMENT, AND RETENTION OF STAFF.— 

5 ‘‘(A) COORDINATION WITH SECRETARY OF

6 LABOR TO RECRUIT AND TRAIN LONG-TERM

7 CARE STAFF.—The Secretary shall coordinate 

8 activities under this subsection with the Sec9 retary of Labor in order to provide incentives 

10 for individuals to train for and seek employ11 ment providing direct care in long-term care. 

12 ‘‘(B) CAREER LADDERS AND WAGE OR

13 BENEFIT INCREASES TO INCREASE STAFFING IN

14 LONG-TERM CARE.— 

15 ‘‘(i) IN GENERAL.—The Secretary 

16 shall make grants to eligible entities to 

17 carry out programs through which the en18 tities— 

19 ‘‘(I) offer, to employees who pro20 vide direct care to residents of an eli21 gible entity or individuals receiving 

22 community-based long-term care from 

23 an eligible entity, continuing training 

24 and varying levels of certification, 

25 based on observed clinical care pracVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01822 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 tices and the amount of time the em2 ployees spend providing direct care; 

3 and 

4 ‘‘(II) provide, or make arrange5 ments to provide, bonuses or other in6 creased compensation or benefits to 

7 employees who achieve certification 

8 under such a program. 

9 ‘‘(ii) APPLICATION.—To be eligible to 

10 receive a grant under this subparagraph, 

11 an eligible entity shall submit an applica12 tion to the Secretary at such time, in such 

13 manner, and containing such information 

14 as the Secretary may require (which may 

15 include evidence of consultation with the 

16 State in which the eligible entity is located 

17 with respect to carrying out activities fund18 ed under the grant). 

19 ‘‘(iii) AUTHORITY TO LIMIT NUMBER

20 OF APPLICANTS.—Nothing in this subpara21 graph shall be construed as prohibiting the 

22 Secretary from limiting the number of ap23 plicants for a grant under this subpara24 graph. 


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1 ‘‘(3) SPECIFIC PROGRAMS TO IMPROVE MAN2 AGEMENT PRACTICES.— 

3 ‘‘(A) IN GENERAL.—The Secretary shall 

4 make grants to eligible entities to enable the en5 tities to provide training and technical assist6 ance. 

7 ‘‘(B) AUTHORIZED ACTIVITIES.—An eligi8 ble entity that receives a grant under subpara9 graph (A) shall use funds made available 

10 through the grant to provide training and tech11 nical assistance regarding management prac12 tices using methods that are demonstrated to 

13 promote retention of individuals who provide di14 rect care, such as— 

15 ‘‘(i) the establishment of standard 

16 human resource policies that reward high 

17 performance, including policies that pro18 vide for improved wages and benefits on 

19 the basis of job reviews; 

20 ‘‘(ii) the establishment of motivational 

21 and thoughtful work organization prac22 tices; 

23 ‘‘(iii) the creation of a workplace cul24 ture that respects and values caregivers 

25 and their needs; 


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1 ‘‘(iv) the promotion of a workplace 

2 culture that respects the rights of residents 

3 of an eligible entity or individuals receiving 

4 community-based long-term care from an 

5 eligible entity and results in improved care 

6 for the residents or the individuals; and 

7 ‘‘(v) the establishment of other pro8 grams that promote the provision of high 

9 quality care, such as a continuing edu10 cation program that provides additional 

11 hours of training, including on-the-job 

12 training, for employees who are certified 

13 nurse aides. 

14 ‘‘(C) APPLICATION.—To be eligible to re15 ceive a grant under this paragraph, an eligible 

16 entity shall submit an application to the Sec17 retary at such time, in such manner, and con18 taining such information as the Secretary may 

19 require (which may include evidence of con20 sultation with the State in which the eligible en21 tity is located with respect to carrying out ac22 tivities funded under the grant). 

23 ‘‘(D) AUTHORITY TO LIMIT NUMBER OF

24 APPLICANTS.—Nothing in this paragraph shall 

25 be construed as prohibiting the Secretary from 


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1 limiting the number of applicants for a grant 

2 under this paragraph. 

3 ‘‘(4) ACCOUNTABILITY MEASURES.—The Sec4 retary shall develop accountability measures to en5 sure that the activities conducted using funds made 

6 available under this subsection benefit individuals 

7 who provide direct care and increase the stability of 

8 the long-term care workforce. 

9 ‘‘(5) DEFINITIONS.—In this subsection: 

10 ‘‘(A) COMMUNITY-BASED LONG-TERM

11 CARE.—The term ‘community-based long-term 

12 care’ has the meaning given such term by the 

13 Secretary. 

14 ‘‘(B) ELIGIBLE ENTITY.—The term ‘eligi15 ble entity’ means the following: 

16 ‘‘(i) A long-term care facility. 

17 ‘‘(ii) A community-based long-term 

18 care entity (as defined by the Secretary). 

19 ‘‘(b) CERTIFIED EHR TECHNOLOGY GRANT PRO20 GRAM.— 

21 ‘‘(1) GRANTS AUTHORIZED.—The Secretary is 

22 authorized to make grants to long-term care facili23 ties for the purpose of assisting such entities in off24 setting the costs related to purchasing, leasing, de25 veloping, and implementing certified EHR techVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01826 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 nology (as defined in section 1848(o)(4)) designed to 

2 improve patient safety and reduce adverse events 

3 and health care complications resulting from medica4 tion errors. 

5 ‘‘(2) USE OF GRANT FUNDS.—Funds provided 

6 under grants under this subsection may be used for 

7 any of the following: 

8 ‘‘(A) Purchasing, leasing, and installing 

9 computer software and hardware, including 

10 handheld computer technologies. 

11 ‘‘(B) Making improvements to existing 

12 computer software and hardware. 

13 ‘‘(C) Making upgrades and other improve14 ments to existing computer software and hard15 ware to enable e-prescribing. 

16 ‘‘(D) Providing education and training to 

17 eligible long-term care facility staff on the use 

18 of such technology to implement the electronic 

19 transmission of prescription and patient infor20 mation. 

21 ‘‘(3) APPLICATION.— 

22 ‘‘(A) IN GENERAL.—To be eligible to re23 ceive a grant under this subsection, a long-term 

24 care facility shall submit an application to the 

25 Secretary at such time, in such manner, and 


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1 containing such information as the Secretary 

2 may require (which may include evidence of 

3 consultation with the State in which the long4 term care facility is located with respect to car5 rying out activities funded under the grant). 

6 ‘‘(B) AUTHORITY TO LIMIT NUMBER OF

7 APPLICANTS.—Nothing in this subsection shall 

8 be construed as prohibiting the Secretary from 

9 limiting the number of applicants for a grant 

10 under this subsection. 

11 ‘‘(4) PARTICIPATION IN STATE HEALTH EX12 CHANGES.—A long-term care facility that receives a 

13 grant under this subsection shall, where available, 

14 participate in activities conducted by a State or a 

15 qualified State-designated entity (as defined in sec16 tion 3013(f) of the Public Health Service Act) under 

17 a grant under section 3013 of the Public Health 

18 Service Act to coordinate care and for other pur19 poses determined appropriate by the Secretary. 

20 ‘‘(5) ACCOUNTABILITY MEASURES.—The Sec21 retary shall develop accountability measures to en22 sure that the activities conducted using funds made 

23 available under this subsection help improve patient 

24 safety and reduce adverse events and health care 

25 complications resulting from medication errors. 


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1 ‘‘(c) ADOPTION OF STANDARDS FOR TRANSACTIONS

2 INVOLVING CLINICAL DATA BY LONG-TERM CARE FA3 CILITIES.— 

4 ‘‘(1) STANDARDS AND COMPATIBILITY.—The 

5 Secretary shall adopt electronic standards for the ex6 change of clinical data by long-term care facilities, 

7 including, where available, standards for messaging 

8 and nomenclature. Standards adopted by the Sec9 retary under the preceding sentence shall be compat10 ible with standards established under part C of title 

11 XI, standards established under subsections 

12 (b)(2)(B)(i) and (e)(4) of section 1860D–4, stand13 ards adopted under section 3004 of the Public 

14 Health Service Act, and general health information 

15 technology standards. 

16 ‘‘(2) ELECTRONIC SUBMISSION OF DATA TO

17 THE SECRETARY.— 

18 ‘‘(A) IN GENERAL.—Not later than 10 

19 years after the date of enactment of the Elder 

20 Justice Act of 2009, the Secretary shall have 

21 procedures in place to accept the optional elec22 tronic submission of clinical data by long-term 

23 care facilities pursuant to the standards adopt24 ed under paragraph (1). 


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1 ‘‘(B) RULE OF CONSTRUCTION.—Nothing 

2 in this subsection shall be construed to require 

3 a long-term care facility to submit clinical data 

4 electronically to the Secretary. 

5 ‘‘(3) REGULATIONS.—The Secretary shall pro6 mulgate regulations to carry out this subsection. 

7 Such regulations shall require a State, as a condi8 tion of the receipt of funds under this part, to con9 duct such data collection and reporting as the Sec10 retary determines are necessary to satisfy the re11 quirements of this subsection. 

12 ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There 

13 are authorized to be appropriated to carry out this sec14 tion— 

15 ‘‘(1) for fiscal year 2011, $20,000,000; 

16 ‘‘(2) for fiscal year 2012, $17,500,000; and 

17 ‘‘(3) for each of fiscal years 2013 and 2014, 

18 $15,000,000. 

19 ‘‘SEC. 2042. ADULT PROTECTIVE SERVICES FUNCTIONS AND 

20 GRANT PROGRAMS. 

21 ‘‘(a) SECRETARIAL RESPONSIBILITIES.— 

22 ‘‘(1) IN GENERAL.—The Secretary shall ensure 

23 that the Department of Health and Human Serv24 ices— 


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1 ‘‘(A) provides funding authorized by this 

2 part to State and local adult protective services 

3 offices that investigate reports of the abuse, ne4 glect, and exploitation of elders; 

5 ‘‘(B) collects and disseminates data annu6 ally relating to the abuse, exploitation, and ne7 glect of elders in coordination with the Depart8 ment of Justice; 

9 ‘‘(C) develops and disseminates informa10 tion on best practices regarding, and provides 

11 training on, carrying out adult protective serv12 ices; 

13 ‘‘(D) conducts research related to the pro14 vision of adult protective services; and 

15 ‘‘(E) provides technical assistance to 

16 States and other entities that provide or fund 

17 the provision of adult protective services, in18 cluding through grants made under subsections 

19 (b) and (c). 

20 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.— 

21 There are authorized to be appropriated to carry out 

22 this subsection, $3,000,000 for fiscal year 2011 and 

23 $4,000,000 for each of fiscal years 2012 through 

24 2014. 


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1 ‘‘(b) GRANTS TO ENHANCE THE PROVISION OF

2 ADULT PROTECTIVE SERVICES.— 

3 ‘‘(1) ESTABLISHMENT.—There is established an 

4 adult protective services grant program under which 

5 the Secretary shall annually award grants to States 

6 in the amounts calculated under paragraph (2) for 

7 the purposes of enhancing adult protective services 

8 provided by States and local units of government. 

9 ‘‘(2) AMOUNT OF PAYMENT.— 

10 ‘‘(A) IN GENERAL.—Subject to the avail11 ability of appropriations and subparagraphs (B) 

12 and (C), the amount paid to a State for a fiscal 

13 year under the program under this subsection 

14 shall equal the amount appropriated for that 

15 year to carry out this subsection multiplied by 

16 the percentage of the total number of elders 

17 who reside in the United States who reside in 

18 that State. 

19 ‘‘(B) GUARANTEED MINIMUM PAYMENT

20 AMOUNT.— 

21 ‘‘(i) 50 STATES.—Subject to clause 

22 (ii), if the amount determined under sub23 paragraph (A) for a State for a fiscal year 

24 is less than 0.75 percent of the amount ap25 propriated for such year, the Secretary 


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1 shall increase such determined amount so 

2 that the total amount paid under this sub3 section to the State for the year is equal 

4 to 0.75 percent of the amount so appro5 priated. 

6 ‘‘(ii) TERRITORIES.—In the case of a 

7 State other than 1 of the 50 States, clause 

8 (i) shall be applied as if each reference to 

9 ‘0.75’ were a reference to ‘0.1’. 

10 ‘‘(C) PRO RATA REDUCTIONS.—The Sec11 retary shall make such pro rata reductions to 

12 the amounts described in subparagraph (A) as 

13 are necessary to comply with the requirements 

14 of subparagraph (B). 

15 ‘‘(3) AUTHORIZED ACTIVITIES.— 

16 ‘‘(A) ADULT PROTECTIVE SERVICES.— 

17 Funds made available pursuant to this sub18 section may only be used by States and local 

19 units of government to provide adult protective 

20 services and may not be used for any other pur21 pose. 

22 ‘‘(B) USE BY AGENCY.—Each State receiv23 ing funds pursuant to this subsection shall pro24 vide such funds to the agency or unit of State 


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1 government having legal responsibility for pro2 viding adult protective services within the State. 

3 ‘‘(C) SUPPLEMENT NOT SUPPLANT.—Each 

4 State or local unit of government shall use 

5 funds made available pursuant to this sub6 section to supplement and not supplant other 

7 Federal, State, and local public funds expended 

8 to provide adult protective services in the State. 

9 ‘‘(4) STATE REPORTS.—Each State receiving 

10 funds under this subsection shall submit to the Sec11 retary, at such time and in such manner as the Sec12 retary may require, a report on the number of elders 

13 served by the grants awarded under this subsection. 

14 ‘‘(5) AUTHORIZATION OF APPROPRIATIONS.— 

15 There are authorized to be appropriated to carry out 

16 this subsection, $100,000,000 for each of fiscal 

17 years 2011 through 2014. 

18 ‘‘(c) STATE DEMONSTRATION PROGRAMS.— 

19 ‘‘(1) ESTABLISHMENT.—The Secretary shall 

20 award grants to States for the purposes of con21 ducting demonstration programs in accordance with 

22 paragraph (2). 

23 ‘‘(2) DEMONSTRATION PROGRAMS.—Funds 

24 made available pursuant to this subsection may be 


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1 used by States and local units of government to con2 duct demonstration programs that test— 

3 ‘‘(A) training modules developed for the 

4 purpose of detecting or preventing elder abuse; 

5 ‘‘(B) methods to detect or prevent financial 

6 exploitation of elders; 

7 ‘‘(C) methods to detect elder abuse; 

8 ‘‘(D) whether training on elder abuse 

9 forensics enhances the detection of elder abuse 

10 by employees of the State or local unit of gov11 ernment; or 

12 ‘‘(E) other matters relating to the detec13 tion or prevention of elder abuse. 

14 ‘‘(3) APPLICATION.—To be eligible to receive a 

15 grant under this subsection, a State shall submit an 

16 application to the Secretary at such time, in such 

17 manner, and containing such information as the Sec18 retary may require. 

19 ‘‘(4) STATE REPORTS.—Each State that re20 ceives funds under this subsection shall submit to 

21 the Secretary a report at such time, in such manner, 

22 and containing such information as the Secretary 

23 may require on the results of the demonstration pro24 gram conducted by the State using funds made 

25 available under this subsection. 


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1 ‘‘(5) AUTHORIZATION OF APPROPRIATIONS.— 

2 There are authorized to be appropriated to carry out 

3 this subsection, $25,000,000 for each of fiscal years 

4 2011 through 2014. 

5 ‘‘SEC. 2043. LONG-TERM CARE OMBUDSMAN PROGRAM 

6 GRANTS AND TRAINING. 

7 ‘‘(a) GRANTS TO SUPPORT THE LONG-TERM CARE

8 OMBUDSMAN PROGRAM.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall make 

10 grants to eligible entities with relevant expertise and 

11 experience in abuse and neglect in long-term care fa12 cilities or long-term care ombudsman programs and 

13 responsibilities, for the purpose of— 

14 ‘‘(A) improving the capacity of State long15 term care ombudsman programs to respond to 

16 and resolve complaints about abuse and neglect; 

17 ‘‘(B) conducting pilot programs with State 

18 long-term care ombudsman offices or local om19 budsman entities; and 

20 ‘‘(C) providing support for such State 

21 long-term care ombudsman programs and such 

22 pilot programs (such as through the establish23 ment of a national long-term care ombudsman 

24 resource center). 


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1 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.— 

2 There are authorized to be appropriated to carry out 

3 this subsection— 

4 ‘‘(A) for fiscal year 2011, $5,000,000; 

5 ‘‘(B) for fiscal year 2012, $7,500,000; and 

6 ‘‘(C) for each of fiscal years 2013 and 

7 2014, $10,000,000. 

8 ‘‘(b) OMBUDSMAN TRAINING PROGRAMS.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall estab10 lish programs to provide and improve ombudsman 

11 training with respect to elder abuse, neglect, and ex12 ploitation for national organizations and State long13 term care ombudsman programs. 

14 ‘‘(2) AUTHORIZATION OF APPROPRIATIONS.— 

15 There are authorized to be appropriated to carry out 

16 this subsection, for each of fiscal years 2011 

17 through 2014, $10,000,000. 

18 ‘‘SEC. 2044. PROVISION OF INFORMATION REGARDING, AND 

19 EVALUATIONS OF, ELDER JUSTICE PRO20 GRAMS. 

21 ‘‘(a) PROVISION OF INFORMATION.—To be eligible to 

22 receive a grant under this part, an applicant shall agree— 

23 ‘‘(1) except as provided in paragraph (2), to 

24 provide the eligible entity conducting an evaluation 

25 under subsection (b) of the activities funded through 


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1 the grant with such information as the eligible entity 

2 may require in order to conduct such evaluation; or 

3 ‘‘(2) in the case of an applicant for a grant 

4 under section 2041(b), to provide the Secretary with 

5 such information as the Secretary may require to 

6 conduct an evaluation or audit under subsection (c). 

7 ‘‘(b) USE OF ELIGIBLE ENTITIES TO CONDUCT

8 EVALUATIONS.— 

9 ‘‘(1) EVALUATIONS REQUIRED.—Except as pro10 vided in paragraph (2), the Secretary shall— 

11 ‘‘(A) reserve a portion (not less than 2 per12 cent) of the funds appropriated with respect to 

13 each program carried out under this part; and 

14 ‘‘(B) use the funds reserved under sub15 paragraph (A) to provide assistance to eligible 

16 entities to conduct evaluations of the activities 

17 funded under each program carried out under 

18 this part. 

19 ‘‘(2) CERTIFIED EHR TECHNOLOGY GRANT PRO20 GRAM NOT INCLUDED.—The provisions of this sub21 section shall not apply to the certified EHR tech22 nology grant program under section 2041(b). 

23 ‘‘(3) AUTHORIZED ACTIVITIES.—A recipient of 

24 assistance described in paragraph (1)(B) shall use 

25 the funds made available through the assistance to 


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1 conduct a validated evaluation of the effectiveness of 

2 the activities funded under a program carried out 

3 under this part. 

4 ‘‘(4) APPLICATIONS.—To be eligible to receive 

5 assistance under paragraph (1)(B), an entity shall 

6 submit an application to the Secretary at such time, 

7 in such manner, and containing such information as 

8 the Secretary may require, including a proposal for 

9 the evaluation. 

10 ‘‘(5) REPORTS.—Not later than a date specified 

11 by the Secretary, an eligible entity receiving assist12 ance under paragraph (1)(B) shall submit to the 

13 Secretary, the Committee on Ways and Means and 

14 the Committee on Energy and Commerce of the 

15 House of Representatives, and the Committee on Fi16 nance of the Senate a report containing the results 

17 of the evaluation conducted using such assistance to18 gether with such recommendations as the entity de19 termines to be appropriate. 

20 ‘‘(c) EVALUATIONS AND AUDITS OF CERTIFIED EHR 

21 TECHNOLOGY GRANT PROGRAM BY THE SECRETARY.— 

22 ‘‘(1) EVALUATIONS.—The Secretary shall con23 duct an evaluation of the activities funded under the 

24 certified EHR technology grant program under sec25 tion 2041(b). Such evaluation shall include an evalVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01839 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 uation of whether the funding provided under the 

2 grant is expended only for the purposes for which it 

3 is made. 

4 ‘‘(2) AUDITS.—The Secretary shall conduct ap5 propriate audits of grants made under section 

6 2041(b). 

7 ‘‘SEC. 2045. REPORT. 

8 ‘‘Not later than October 1, 2014, the Secretary shall 

9 submit to the Elder Justice Coordinating Council estab10 lished under section 2021, the Committee on Ways and 

11 Means and the Committee on Energy and Commerce of 

12 the House of Representatives, and the Committee on Fi13 nance of the Senate a report— 

14 ‘‘(1) compiling, summarizing, and analyzing the 

15 information contained in the State reports submitted 

16 under subsections (b)(4) and (c)(4) of section 2042; 

17 and 

18 ‘‘(2) containing such recommendations for legis19 lative or administrative action as the Secretary de20 termines to be appropriate. 

21 ‘‘SEC. 2046. RULE OF CONSTRUCTION. 

22 ‘‘Nothing in this subtitle shall be construed as— 

23 ‘‘(1) limiting any cause of action or other relief 

24 related to obligations under this subtitle that is 


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1 available under the law of any State, or political sub2 division thereof; or 

3 ‘‘(2) creating a private cause of action for a vio4 lation of this subtitle.’’. 

5 (2) OPTION FOR STATE PLAN UNDER PROGRAM

6 FOR TEMPORARY ASSISTANCE FOR NEEDY FAMI7 LIES.— 

8 (A) IN GENERAL.—Section 402(a)(1)(B) of 

9 the Social Security Act (42 U.S.C. 

10 602(a)(1)(B)) is amended by adding at the end 

11 the following new clause: 

12 ‘‘(v) The document shall indicate 

13 whether the State intends to assist individ14 uals to train for, seek, and maintain em15 ployment— 

16 ‘‘(I) providing direct care in a 

17 long-term care facility (as such terms 

18 are defined under section 2011); or 

19 ‘‘(II) in other occupations related 

20 to elder care determined appropriate 

21 by the State for which the State iden22 tifies an unmet need for service per23 sonnel, 

24 and, if so, shall include an overview of such 

25 assistance.’’. 


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1 (B) EFFECTIVE DATE.—The amendment 

2 made by subparagraph (A) shall take effect on 

3 January 1, 2011. 

4 (b) PROTECTING RESIDENTS OF LONG-TERM CARE

5 FACILITIES.— 

6 (1) NATIONAL TRAINING INSTITUTE FOR SUR7 VEYORS.— 

8 (A) IN GENERAL.—The Secretary of 

9 Health and Human Services shall enter into a 

10 contract with an entity for the purpose of estab11 lishing and operating a National Training Insti12 tute for Federal and State surveyors. Such In13 stitute shall provide and improve the training of 

14 surveyors with respect to investigating allega15 tions of abuse, neglect, and misappropriation of 

16 property in programs and long-term care facili17 ties that receive payments under title XVIII or 

18 XIX of the Social Security Act. 

19 (B) ACTIVITIES CARRIED OUT BY THE IN20 STITUTE.—The contract entered into under 

21 subparagraph (A) shall require the Institute es22 tablished and operated under such contract to 

23 carry out the following activities: 

24 (i) Assess the extent to which State 

25 agencies use specialized surveyors for the 


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1 investigation of reported allegations of 

2 abuse, neglect, and misappropriation of 

3 property in such programs and long-term 

4 care facilities. 

5 (ii) Evaluate how the competencies of 

6 surveyors may be improved to more effec7 tively investigate reported allegations of 

8 such abuse, neglect, and misappropriation 

9 of property, and provide feedback to Fed10 eral and State agencies on the evaluations 

11 conducted. 

12 (iii) Provide a national program of 

13 training, tools, and technical assistance to 

14 Federal and State surveyors on inves15 tigating reports of such abuse, neglect, and 

16 misappropriation of property. 

17 (iv) Develop and disseminate informa18 tion on best practices for the investigation 

19 of such abuse, neglect, and misappropria20 tion of property. 

21 (v) Assess the performance of State 

22 complaint intake systems, in order to en23 sure that the intake of complaints occurs 

24 24 hours per day, 7 days a week (including 

25 holidays). 


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1 (vi) To the extent approved by the 

2 Secretary of Health and Human Services, 

3 provide a national 24 hours per day, 7 

4 days a week (including holidays), back-up 

5 system to State complaint intake systems 

6 in order to ensure optimum national re7 sponsiveness to complaints of such abuse, 

8 neglect, and misappropriation of property. 

9 (vii) Analyze and report annually on 

10 the following: 

11 (I) The total number and sources 

12 of complaints of such abuse, neglect, 

13 and misappropriation of property. 

14 (II) The extent to which such 

15 complaints are referred to law en16 forcement agencies. 

17 (III) General results of Federal 

18 and State investigations of such com19 plaints. 

20 (viii) Conduct a national study of the 

21 cost to State agencies of conducting com22 plaint investigations of skilled nursing fa23 cilities and nursing facilities under sections 

24 1819 and 1919, respectively, of the Social 

25 Security Act (42 U.S.C. 1395i–3; 1396r), 


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1 and making recommendations to the Sec2 retary of Health and Human Services with 

3 respect to options to increase the efficiency 

4 and cost-effectiveness of such investiga5 tions. 

6 (C) AUTHORIZATION.—There are author7 ized to be appropriated to carry out this para8 graph, for the period of fiscal years 2011 

9 through 2014, $12,000,000. 

10 (2) GRANTS TO STATE SURVEY AGENCIES.— 

11 (A) IN GENERAL.—The Secretary of 

12 Health and Human Services shall make grants 

13 to State agencies that perform surveys of 

14 skilled nursing facilities or nursing facilities 

15 under sections 1819 or 1919, respectively, of 

16 the Social Security Act (42 U.S.C. 1395i–3; 

17 1395r). 

18 (B) USE OF FUNDS.—A grant awarded 

19 under subparagraph (A) shall be used for the 

20 purpose of designing and implementing com21 plaint investigations systems that— 

22 (i) promptly prioritize complaints in 

23 order to ensure a rapid response to the 

24 most serious and urgent complaints; 


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1 (ii) respond to complaints with opti2 mum effectiveness and timeliness; and 

3 (iii) optimize the collaboration be4 tween local authorities, consumers, and 

5 providers, including— 

6 (I) such State agency; 

7 (II) the State Long-Term Care 

8 Ombudsman; 

9 (III) local law enforcement agen10 cies; 

11 (IV) advocacy and consumer or12 ganizations; 

13 (V) State aging units; 

14 (VI) Area Agencies on Aging; 

15 and 

16 (VII) other appropriate entities. 

17 (C) AUTHORIZATION.—There are author18 ized to be appropriated to carry out this para19 graph, for each of fiscal years 2011 through 

20 2014, $5,000,000. 

21 (3) REPORTING OF CRIMES IN FEDERALLY

22 FUNDED LONG-TERM CARE FACILITIES.—Part A of 

23 title XI of the Social Security Act (42 U.S.C. 1301 

24 et seq.), as amended by section 6005, is amended by 


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1 inserting after section 1150A the following new sec2 tion: 

3 ‘‘REPORTING TO LAW ENFORCEMENT OF CRIMES OCCUR4 RING IN FEDERALLY FUNDED LONG-TERM CARE FA5 CILITIES

6 ‘‘SEC. 1150B. (a) DETERMINATION AND NOTIFICA7 TION.— 

8 ‘‘(1) DETERMINATION.—The owner or operator 

9 of each long-term care facility that receives Federal 

10 funds under this Act shall annually determine 

11 whether the facility received at least $10,000 in such 

12 Federal funds during the preceding year. 

13 ‘‘(2) NOTIFICATION.—If the owner or operator 

14 determines under paragraph (1) that the facility re15 ceived at least $10,000 in such Federal funds during 

16 the preceding year, such owner or operator shall an17 nually notify each covered individual (as defined in 

18 paragraph (3)) of that individual’s obligation to 

19 comply with the reporting requirements described in 

20 subsection (b). 

21 ‘‘(3) COVERED INDIVIDUAL DEFINED.—In this 

22 section, the term ‘covered individual’ means each in23 dividual who is an owner, operator, employee, man24 ager, agent, or contractor of a long-term care facility 

25 that is the subject of a determination described in 

26 paragraph (1). 


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1 ‘‘(b) REPORTING REQUIREMENTS.— 

2 ‘‘(1) IN GENERAL.—Each covered individual 

3 shall report to the Secretary and 1 or more law en4 forcement entities for the political subdivision in 

5 which the facility is located any reasonable suspicion 

6 of a crime (as defined by the law of the applicable 

7 political subdivision) against any individual who is a 

8 resident of, or is receiving care from, the facility. 

9 ‘‘(2) TIMING.—If the events that cause the sus10 picion— 

11 ‘‘(A) result in serious bodily injury, the in12 dividual shall report the suspicion immediately, 

13 but not later than 2 hours after forming the 

14 suspicion; and 

15 ‘‘(B) do not result in serious bodily injury, 

16 the individual shall report the suspicion not 

17 later than 24 hours after forming the suspicion. 

18 ‘‘(c) PENALTIES.— 

19 ‘‘(1) IN GENERAL.—If a covered individual vio20 lates subsection (b)— 

21 ‘‘(A) the covered individual shall be subject 

22 to a civil money penalty of not more than 

23 $200,000; and 

24 ‘‘(B) the Secretary may make a determina25 tion in the same proceeding to exclude the covVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01848 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 ered individual from participation in any Fed2 eral health care program (as defined in section 

3 1128B(f)). 

4 ‘‘(2) INCREASED HARM.—If a covered indi5 vidual violates subsection (b) and the violation exac6 erbates the harm to the victim of the crime or re7 sults in harm to another individual— 

8 ‘‘(A) the covered individual shall be subject 

9 to a civil money penalty of not more than 

10 $300,000; and 

11 ‘‘(B) the Secretary may make a determina12 tion in the same proceeding to exclude the cov13 ered individual from participation in any Fed14 eral health care program (as defined in section 

15 1128B(f)). 

16 ‘‘(3) EXCLUDED INDIVIDUAL.—During any pe17 riod for which a covered individual is classified as an 

18 excluded individual under paragraph (1)(B) or 

19 (2)(B), a long-term care facility that employs such 

20 individual shall be ineligible to receive Federal funds 

21 under this Act. 

22 ‘‘(4) EXTENUATING CIRCUMSTANCES.— 

23 ‘‘(A) IN GENERAL.—The Secretary may 

24 take into account the financial burden on pro25 viders with underserved populations in deterVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01849 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 mining any penalty to be imposed under this 

2 subsection. 

3 ‘‘(B) UNDERSERVED POPULATION DE4 FINED.—In this paragraph, the term ‘under5 served population’ means the population of an 

6 area designated by the Secretary as an area 

7 with a shortage of elder justice programs or a 

8 population group designated by the Secretary 

9 as having a shortage of such programs. Such 

10 areas or groups designated by the Secretary 

11 may include— 

12 ‘‘(i) areas or groups that are geo13 graphically isolated (such as isolated in a 

14 rural area); 

15 ‘‘(ii) racial and ethnic minority popu16 lations; and 

17 ‘‘(iii) populations underserved because 

18 of special needs (such as language barriers, 

19 disabilities, alien status, or age). 

20 ‘‘(d) ADDITIONAL PENALTIES FOR RETALIATION.— 

21 ‘‘(1) IN GENERAL.—A long-term care facility 

22 may not— 

23 ‘‘(A) discharge, demote, suspend, threaten, 

24 harass, or deny a promotion or other employ25 ment-related benefit to an employee, or in any 


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1 other manner discriminate against an employee 

2 in the terms and conditions of employment be3 cause of lawful acts done by the employee; or 

4 ‘‘(B) file a complaint or a report against a 

5 nurse or other employee with the appropriate 

6 State professional disciplinary agency because 

7 of lawful acts done by the nurse or employee, 

8 for making a report, causing a report to be made, 

9 or for taking steps in furtherance of making a report 

10 pursuant to subsection (b)(1). 

11 ‘‘(2) PENALTIES FOR RETALIATION.—If a long12 term care facility violates subparagraph (A) or (B) 

13 of paragraph (1) the facility shall be subject to a 

14 civil money penalty of not more than $200,000 or 

15 the Secretary may classify the entity as an excluded 

16 entity for a period of 2 years pursuant to section 

17 1128(b), or both. 

18 ‘‘(3) REQUIREMENT TO POST NOTICE.—Each 

19 long-term care facility shall post conspicuously in an 

20 appropriate location a sign (in a form specified by 

21 the Secretary) specifying the rights of employees 

22 under this section. Such sign shall include a state23 ment that an employee may file a complaint with the 

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1 tion with respect to the manner of filing such a com2 plaint. 

3 ‘‘(e) PROCEDURE.—The provisions of section 1128A 

4 (other than subsections (a) and (b) and the second sen5 tence of subsection (f)) shall apply to a civil money penalty 

6 or exclusion under this section in the same manner as such 

7 provisions apply to a penalty or proceeding under section 

8 1128A(a). 

9 ‘‘(f) DEFINITIONS.—In this section, the terms ‘elder 

10 justice’, ‘long-term care facility’, and ‘law enforcement’ 

11 have the meanings given those terms in section 2011.’’. 

12 (c) NATIONAL NURSE AIDE REGISTRY.— 

13 (1) DEFINITION OF NURSE AIDE.—In this sub14 section, the term ‘‘nurse aide’’ has the meaning 

15 given that term in sections 1819(b)(5)(F) and 

16 1919(b)(5)(F) of the Social Security Act (42 U.S.C. 

17 1395i–3(b)(5)(F); 1396r(b)(5)(F)). 

18 (2) STUDY AND REPORT.— 

19 (A) IN GENERAL.—The Secretary, in con20 sultation with appropriate government agencies 

21 and private sector organizations, shall conduct 

22 a study on establishing a national nurse aide 

23 registry. 


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1 (B) AREAS EVALUATED.—The study con2 ducted under this subsection shall include an 

3 evaluation of— 

4 (i) who should be included in the reg5 istry; 

6 (ii) how such a registry would comply 

7 with Federal and State privacy laws and 

8 regulations; 

9 (iii) how data would be collected for 

10 the registry; 

11 (iv) what entities and individuals 

12 would have access to the data collected; 

13 (v) how the registry would provide ap14 propriate information regarding violations 

15 of Federal and State law by individuals in16 cluded in the registry; 

17 (vi) how the functions of a national 

18 nurse aide registry would be coordinated 

19 with the nationwide program for national 

20 and State background checks on direct pa21 tient access employees of long-term care 

22 facilities and providers under section 4301; 

23 and 

24 (vii) how the information included in 

25 State nurse aide registries developed and 


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1 maintained under sections 1819(e)(2) and 

2 1919(e)(2) of the Social Security Act (42 

3 U.S.C. 1395i–3(e)(2); 1396r(e)(2)(2)) 

4 would be provided as part of a national 

5 nurse aide registry. 

6 (C) CONSIDERATIONS.—In conducting the 

7 study and preparing the report required under 

8 this subsection, the Secretary shall take into 

9 consideration the findings and conclusions of 

10 relevant reports and other relevant resources, 

11 including the following: 

12 (i) The Department of Health and 

13 Human Services Office of Inspector Gen14 eral Report, Nurse Aide Registries: State 

15 Compliance and Practices (February 

16 2005). 

17 (ii) The General Accounting Office 

18 (now known as the Government Account19 ability Office) Report, Nursing Homes: 

20 More Can Be Done to Protect Residents 

21 from Abuse (March 2002). 

22 (iii) The Department of Health and 

23 Human Services Office of the Inspector 

24 General Report, Nurse Aide Registries: 


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1 Long-Term Care Facility Compliance and 

2 Practices (July 2005). 

3 (iv) The Department of Health and 

4 Human Services Health Resources and 

5 Services Administration Report, Nursing 

6 Aides, Home Health Aides, and Related 

7 Health Care Occupations—National and 

8 Local Workforce Shortages and Associated 

9 Data Needs (2004) (in particular with re10 spect to chapter 7 and appendix F). 

11 (v) The 2001 Report to CMS from 

12 the School of Rural Public Health, Texas 

13 A&M University, Preventing Abuse and 

14 Neglect in Nursing Homes: The Role of 

15 Nurse Aide Registries. 

16 (vi) Information included in State 

17 nurse aide registries developed and main18 tained under sections 1819(e)(2) and 

19 1919(e)(2) of the Social Security Act (42 

20 U.S.C. 1395i–3(e)(2); 1396r(e)(2)(2)). 

21 (D) REPORT.—Not later than 18 months 

22 after the date of enactment of this Act, the Sec23 retary shall submit to the Elder Justice Coordi24 nating Council established under section 2021 

25 of the Social Security Act, as added by section 


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1 1805(a), the Committee on Finance of the Sen2 ate, and the Committee on Ways and Means 

3 and the Committee on Energy and Commerce 

4 of the House of Representatives a report con5 taining the findings and recommendations of 

6 the study conducted under this paragraph. 

7 (E) FUNDING LIMITATION.—Funding for 

8 the study conducted under this subsection shall 

9 not exceed $500,000. 

10 (3) CONGRESSIONAL ACTION.—After receiving 

11 the report submitted by the Secretary under para12 graph (2)(D), the Committee on Finance of the Sen13 ate and the Committee on Ways and Means and the 

14 Committee on Energy and Commerce of the House 

15 of Representatives shall, as they deem appropriate, 

16 take action based on the recommendations contained 

17 in the report. 

18 (4) AUTHORIZATION OF APPROPRIATIONS.— 

19 There are authorized to be appropriated such sums 

20 as are necessary for the purpose of carrying out this 

21 subsection. 

22 (d) CONFORMING AMENDMENTS.— 

23 (1) TITLE XX.—Title XX of the Social Security 

24 Act (42 U.S.C. 1397 et seq.), as amended by section 

25 6703(a), is amended— 


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1 (A) in the heading of section 2001, by 

2 striking ‘‘TITLE’’ and inserting ‘‘SUBTITLE’’; 

3 and 

4 (B) in subtitle 1, by striking ‘‘this title’’ 

5 each place it appears and inserting ‘‘this sub6 title’’. 

7 (2) TITLE IV.—Title IV of the Social Security 

8 Act (42 U.S.C. 601 et seq.) is amended— 

9 (A) in section 404(d)— 

10 (i) in paragraphs (1)(A), (2)(A), and 

11 (3)(B), by inserting ‘‘subtitle 1 of’’ before 

12 ‘‘title XX’’ each place it appears; 

13 (ii) in the heading of paragraph (2), 

14 by inserting ‘‘SUBTITLE 1 OF’’ before 

15 ‘‘TITLE XX’’; and 

16 (iii) in the heading of paragraph 

17 (3)(B), by inserting ‘‘SUBTITLE 1 OF’’ be18 fore ‘‘TITLE XX’’; and 

19 (B) in sections 422(b), 471(a)(4), 

20 472(h)(1), and 473(b)(2), by inserting ‘‘subtitle 

21 1 of’’ before ‘‘title XX’’ each place it appears. 

22 (3) TITLE XI.—Title XI of the Social Security 

23 Act (42 U.S.C. 1301 et seq.) is amended— 

24 (A) in section 1128(h)(3)— 


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1 (i) by inserting ‘‘subtitle 1 of’’ before 

2 ‘‘title XX’’; and 

3 (ii) by striking ‘‘such title’’ and in4 serting ‘‘such subtitle’’; and 

5 (B) in section 1128A(i)(1), by inserting 

6 ‘‘subtitle 1 of’’ before ‘‘title XX’’. 

7 Subtitle I—Sense of the Senate 

8 Regarding Medical Malpractice 

9 SEC. 6801. SENSE OF THE SENATE REGARDING MEDICAL 

10 MALPRACTICE. 

11 It is the sense of the Senate that— 

12 (1) health care reform presents an opportunity 

13 to address issues related to medical malpractice and 

14 medical liability insurance; 

15 (2) States should be encouraged to develop and 

16 test alternatives to the existing civil litigation system 

17 as a way of improving patient safety, reducing med18 ical errors, encouraging the efficient resolution of 

19 disputes, increasing the availability of prompt and 

20 fair resolution of disputes, and improving access to 

21 liability insurance, while preserving an individual’s 

22 right to seek redress in court; and 

23 (3) Congress should consider establishing a 

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1 natives to the existing civil litigation system with re2 spect to the resolution of medical malpractice claims. 

3 TITLE VII—IMPROVING ACCESS 

4 TO INNOVATIVE MEDICAL 

5 THERAPIES 

6 Subtitle A—Biologics Price 

7 Competition and Innovation 

8 SEC. 7001. SHORT TITLE. 

9 (a) IN GENERAL.—This subtitle may be cited as the 

10 ‘‘Biologics Price Competition and Innovation Act of 

11 2009’’. 

12 (b) SENSE OF THE SENATE.—It is the sense of the 

13 Senate that a biosimilars pathway balancing innovation 

14 and consumer interests should be established. 

15 SEC. 7002. APPROVAL PATHWAY FOR BIOSIMILAR BIOLOGI16 CAL PRODUCTS. 

17 (a) LICENSURE OF BIOLOGICAL PRODUCTS AS BIO18 SIMILAR OR INTERCHANGEABLE.—Section 351 of the 

19 Public Health Service Act (42 U.S.C. 262) is amended— 

20 (1) in subsection (a)(1)(A), by inserting ‘‘under 

21 this subsection or subsection (k)’’ after ‘‘biologics li22 cense’’; and 

23 (2) by adding at the end the following: 

24 ‘‘(k) LICENSURE OF BIOLOGICAL PRODUCTS AS BIO25 SIMILAR OR INTERCHANGEABLE.— 


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1 ‘‘(1) IN GENERAL.—Any person may submit an 

2 application for licensure of a biological product 

3 under this subsection. 

4 ‘‘(2) CONTENT.— 

5 ‘‘(A) IN GENERAL.— 

6 ‘‘(i) REQUIRED INFORMATION.—An 

7 application submitted under this subsection 

8 shall include information demonstrating 

9 that— 

10 ‘‘(I) the biological product is bio11 similar to a reference product based 

12 upon data derived from— 

13 ‘‘(aa) analytical studies that 

14 demonstrate that the biological 

15 product is highly similar to the 

16 reference product notwith17 standing minor differences in 

18 clinically inactive components; 

19 ‘‘(bb) animal studies (includ20 ing the assessment of toxicity); 

21 and 

22 ‘‘(cc) a clinical study or 

23 studies (including the assessment 

24 of immunogenicity and phar25 macokinetics or 


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1 pharmacodynamics) that are suf2 ficient to demonstrate safety, pu3 rity, and potency in 1 or more 

4 appropriate conditions of use for 

5 which the reference product is li6 censed and intended to be used 

7 and for which licensure is sought 

8 for the biological product; 

9 ‘‘(II) the biological product and 

10 reference product utilize the same 

11 mechanism or mechanisms of action 

12 for the condition or conditions of use 

13 prescribed, recommended, or sug14 gested in the proposed labeling, but 

15 only to the extent the mechanism or 

16 mechanisms of action are known for 

17 the reference product; 

18 ‘‘(III) the condition or conditions 

19 of use prescribed, recommended, or 

20 suggested in the labeling proposed for 

21 the biological product have been pre22 viously approved for the reference 

23 product; 

24 ‘‘(IV) the route of administra25 tion, the dosage form, and the 


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1 strength of the biological product are 

2 the same as those of the reference 

3 product; and 

4 ‘‘(V) the facility in which the bio5 logical product is manufactured, proc6 essed, packed, or held meets stand7 ards designed to assure that the bio8 logical product continues to be safe, 

9 pure, and potent. 

10 ‘‘(ii) DETERMINATION BY SEC11 RETARY.—The Secretary may determine, 

12 in the Secretary’s discretion, that an ele13 ment described in clause (i)(I) is unneces14 sary in an application submitted under this 

15 subsection. 

16 ‘‘(iii) ADDITIONAL INFORMATION.— 

17 An application submitted under this sub18 section— 

19 ‘‘(I) shall include publicly-avail20 able information regarding the Sec21 retary’s previous determination that 

22 the reference product is safe, pure, 

23 and potent; and 

24 ‘‘(II) may include any additional 

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1 tion, including publicly-available infor2 mation with respect to the reference 

3 product or another biological product. 

4 ‘‘(B) INTERCHANGEABILITY.—An applica5 tion (or a supplement to an application) sub6 mitted under this subsection may include infor7 mation demonstrating that the biological prod8 uct meets the standards described in paragraph 

9 (4). 

10 ‘‘(3) EVALUATION BY SECRETARY.—Upon re11 view of an application (or a supplement to an appli12 cation) submitted under this subsection, the Sec13 retary shall license the biological product under this 

14 subsection if— 

15 ‘‘(A) the Secretary determines that the in16 formation submitted in the application (or the 

17 supplement) is sufficient to show that the bio18 logical product— 

19 ‘‘(i) is biosimilar to the reference 

20 product; or 

21 ‘‘(ii) meets the standards described in 

22 paragraph (4), and therefore is inter23 changeable with the reference product; and 

24 ‘‘(B) the applicant (or other appropriate 

25 person) consents to the inspection of the facility 


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1 that is the subject of the application, in accord2 ance with subsection (c). 

3 ‘‘(4) SAFETY STANDARDS FOR DETERMINING

4 INTERCHANGEABILITY.—Upon review of an applica5 tion submitted under this subsection or any supple6 ment to such application, the Secretary shall deter7 mine the biological product to be interchangeable 

8 with the reference product if the Secretary deter9 mines that the information submitted in the applica10 tion (or a supplement to such application) is suffi11 cient to show that— 

12 ‘‘(A) the biological product— 

13 ‘‘(i) is biosimilar to the reference 

14 product; and 

15 ‘‘(ii) can be expected to produce the 

16 same clinical result as the reference prod17 uct in any given patient; and 

18 ‘‘(B) for a biological product that is ad19 ministered more than once to an individual, the 

20 risk in terms of safety or diminished efficacy of 

21 alternating or switching between use of the bio22 logical product and the reference product is not 

23 greater than the risk of using the reference 

24 product without such alternation or switch. 

25 ‘‘(5) GENERAL RULES.— 


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1 ‘‘(A) ONE REFERENCE PRODUCT PER AP2 PLICATION.—A biological product, in an appli3 cation submitted under this subsection, may not 

4 be evaluated against more than 1 reference 

5 product. 

6 ‘‘(B) REVIEW.—An application submitted 

7 under this subsection shall be reviewed by the 

8 division within the Food and Drug Administra9 tion that is responsible for the review and ap10 proval of the application under which the ref11 erence product is licensed. 

12 ‘‘(C) RISK EVALUATION AND MITIGATION

13 STRATEGIES.—The authority of the Secretary 

14 with respect to risk evaluation and mitigation 

15 strategies under the Federal Food, Drug, and 

16 Cosmetic Act shall apply to biological products 

17 licensed under this subsection in the same man18 ner as such authority applies to biological prod19 ucts licensed under subsection (a). 

20 ‘‘(6) EXCLUSIVITY FOR FIRST INTERCHANGE21 ABLE BIOLOGICAL PRODUCT.—Upon review of an 

22 application submitted under this subsection relying 

23 on the same reference product for which a prior bio24 logical product has received a determination of inter25 changeability for any condition of use, the Secretary 


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1 shall not make a determination under paragraph (4) 

2 that the second or subsequent biological product is 

3 interchangeable for any condition of use until the 

4 earlier of— 

5 ‘‘(A) 1 year after the first commercial 

6 marketing of the first interchangeable bio7 similar biological product to be approved as 

8 interchangeable for that reference product; 

9 ‘‘(B) 18 months after— 

10 ‘‘(i) a final court decision on all pat11 ents in suit in an action instituted under 

12 subsection (l)(6) against the applicant that 

13 submitted the application for the first ap14 proved interchangeable biosimilar biological 

15 product; or 

16 ‘‘(ii) the dismissal with or without 

17 prejudice of an action instituted under sub18 section (l)(6) against the applicant that 

19 submitted the application for the first ap20 proved interchangeable biosimilar biological 

21 product; or 

22 ‘‘(C)(i) 42 months after approval of the 

23 first interchangeable biosimilar biological prod24 uct if the applicant that submitted such appli25 cation has been sued under subsection (l)(6) 


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1 and such litigation is still ongoing within such 

2 42-month period; or 

3 ‘‘(ii) 18 months after approval of the first 

4 interchangeable biosimilar biological product if 

5 the applicant that submitted such application 

6 has not been sued under subsection (l)(6). 

7 For purposes of this paragraph, the term ‘final court 

8 decision’ means a final decision of a court from 

9 which no appeal (other than a petition to the United 

10 States Supreme Court for a writ of certiorari) has 

11 been or can be taken. 

12 ‘‘(7) EXCLUSIVITY FOR REFERENCE PROD13 UCT.— 

14 ‘‘(A) EFFECTIVE DATE OF BIOSIMILAR AP15 PLICATION APPROVAL.—Approval of an applica16 tion under this subsection may not be made ef17 fective by the Secretary until the date that is 

18 12 years after the date on which the reference 

19 product was first licensed under subsection (a). 

20 ‘‘(B) FILING PERIOD.—An application 

21 under this subsection may not be submitted to 

22 the Secretary until the date that is 4 years 

23 after the date on which the reference product 

24 was first licensed under subsection (a). 


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1 ‘‘(C) FIRST LICENSURE.—Subparagraphs 

2 (A) and (B) shall not apply to a license for or 

3 approval of— 

4 ‘‘(i) a supplement for the biological 

5 product that is the reference product; or 

6 ‘‘(ii) a subsequent application filed by 

7 the same sponsor or manufacturer of the 

8 biological product that is the reference 

9 product (or a licensor, predecessor in inter10 est, or other related entity) for— 

11 ‘‘(I) a change (not including a 

12 modification to the structure of the bi13 ological product) that results in a new 

14 indication, route of administration, 

15 dosing schedule, dosage form, delivery 

16 system, delivery device, or strength; or 

17 ‘‘(II) a modification to the struc18 ture of the biological product that 

19 does not result in a change in safety, 

20 purity, or potency. 

21 ‘‘(8) GUIDANCE DOCUMENTS.— 

22 ‘‘(A) IN GENERAL.—The Secretary may, 

23 after opportunity for public comment, issue 

24 guidance in accordance, except as provided in 

25 subparagraph (B)(i), with section 701(h) of the 


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1 Federal Food, Drug, and Cosmetic Act with re2 spect to the licensure of a biological product 

3 under this subsection. Any such guidance may 

4 be general or specific. 

5 ‘‘(B) PUBLIC COMMENT.— 

6 ‘‘(i) IN GENERAL.—The Secretary 

7 shall provide the public an opportunity to 

8 comment on any proposed guidance issued 

9 under subparagraph (A) before issuing 

10 final guidance. 

11 ‘‘(ii) INPUT REGARDING MOST VALU12 ABLE GUIDANCE.—The Secretary shall es13 tablish a process through which the public 

14 may provide the Secretary with input re15 garding priorities for issuing guidance. 

16 ‘‘(C) NO REQUIREMENT FOR APPLICATION

17 CONSIDERATION.—The issuance (or non18 issuance) of guidance under subparagraph (A) 

19 shall not preclude the review of, or action on, 

20 an application submitted under this subsection. 

21 ‘‘(D) REQUIREMENT FOR PRODUCT CLASS22 SPECIFIC GUIDANCE.—If the Secretary issues 

23 product class-specific guidance under subpara24 graph (A), such guidance shall include a de25 scription of— 


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1 ‘‘(i) the criteria that the Secretary will 

2 use to determine whether a biological prod3 uct is highly similar to a reference product 

4 in such product class; and 

5 ‘‘(ii) the criteria, if available, that the 

6 Secretary will use to determine whether a 

7 biological product meets the standards de8 scribed in paragraph (4). 

9 ‘‘(E) CERTAIN PRODUCT CLASSES.— 

10 ‘‘(i) GUIDANCE.—The Secretary may 

11 indicate in a guidance document that the 

12 science and experience, as of the date of 

13 such guidance, with respect to a product or 

14 product class (not including any recom15 binant protein) does not allow approval of 

16 an application for a license as provided 

17 under this subsection for such product or 

18 product class. 

19 ‘‘(ii) MODIFICATION OR REVERSAL.— 

20 The Secretary may issue a subsequent 

21 guidance document under subparagraph 

22 (A) to modify or reverse a guidance docu23 ment under clause (i). 

24 ‘‘(iii) NO EFFECT ON ABILITY TO

25 DENY LICENSE.—Clause (i) shall not be 


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1 construed to require the Secretary to ap2 prove a product with respect to which the 

3 Secretary has not indicated in a guidance 

4 document that the science and experience, 

5 as described in clause (i), does not allow 

6 approval of such an application. 

7 ‘‘(l) PATENTS.— 

8 ‘‘(1) CONFIDENTIAL ACCESS TO SUBSECTION

9 (k) APPLICATION.— 

10 ‘‘(A) APPLICATION OF PARAGRAPH.—Un11 less otherwise agreed to by a person that sub12 mits an application under subsection (k) (re13 ferred to in this subsection as the ‘subsection 

14 (k) applicant’) and the sponsor of the applica15 tion for the reference product (referred to in 

16 this subsection as the ‘reference product spon17 sor’), the provisions of this paragraph shall 

18 apply to the exchange of information described 

19 in this subsection. 

20 ‘‘(B) IN GENERAL.— 

21 ‘‘(i) PROVISION OF CONFIDENTIAL IN22 FORMATION.—When a subsection (k) ap23 plicant submits an application under sub24 section (k), such applicant shall provide to 

25 the persons described in clause (ii), subject 


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1 to the terms of this paragraph, confidential 

2 access to the information required to be 

3 produced pursuant to paragraph (2) and 

4 any other information that the subsection 

5 (k) applicant determines, in its sole discre6 tion, to be appropriate (referred to in this 

7 subsection as the ‘confidential informa8 tion’). 

9 ‘‘(ii) RECIPIENTS OF INFORMATION.— 

10 The persons described in this clause are 

11 the following: 

12 ‘‘(I) OUTSIDE COUNSEL.—One or 

13 more attorneys designated by the ref14 erence product sponsor who are em15 ployees of an entity other than the 

16 reference product sponsor (referred to 

17 in this paragraph as the ‘outside 

18 counsel’), provided that such attor19 neys do not engage, formally or infor20 mally, in patent prosecution relevant 

21 or related to the reference product. 

22 ‘‘(II) IN-HOUSE COUNSEL.—One 

23 attorney that represents the reference 

24 product sponsor who is an employee 

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1 vided that such attorney does not en2 gage, formally or informally, in patent 

3 prosecution relevant or related to the 

4 reference product. 

5 ‘‘(iii) PATENT OWNER ACCESS.—A 

6 representative of the owner of a patent ex7 clusively licensed to a reference product 

8 sponsor with respect to the reference prod9 uct and who has retained a right to assert 

10 the patent or participate in litigation con11 cerning the patent may be provided the 

12 confidential information, provided that the 

13 representative informs the reference prod14 uct sponsor and the subsection (k) appli15 cant of his or her agreement to be subject 

16 to the confidentiality provisions set forth in 

17 this paragraph, including those under 

18 clause (ii). 

19 ‘‘(C) LIMITATION ON DISCLOSURE.—No 

20 person that receives confidential information 

21 pursuant to subparagraph (B) shall disclose 

22 any confidential information to any other per23 son or entity, including the reference product 

24 sponsor employees, outside scientific consult25 ants, or other outside counsel retained by the 


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1 reference product sponsor, without the prior 

2 written consent of the subsection (k) applicant, 

3 which shall not be unreasonably withheld. 

4 ‘‘(D) USE OF CONFIDENTIAL INFORMA5 TION.—Confidential information shall be used 

6 for the sole and exclusive purpose of deter7 mining, with respect to each patent assigned to 

8 or exclusively licensed by the reference product 

9 sponsor, whether a claim of patent infringement 

10 could reasonably be asserted if the subsection 

11 (k) applicant engaged in the manufacture, use, 

12 offering for sale, sale, or importation into the 

13 United States of the biological product that is 

14 the subject of the application under subsection 

15 (k). 

16 ‘‘(E) OWNERSHIP OF CONFIDENTIAL IN17 FORMATION.—The confidential information dis18 closed under this paragraph is, and shall re19 main, the property of the subsection (k) appli20 cant. By providing the confidential information 

21 pursuant to this paragraph, the subsection (k) 

22 applicant does not provide the reference product 

23 sponsor or the outside counsel any interest in or 

24 license to use the confidential information, for 


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1 purposes other than those specified in subpara2 graph (D). 

3 ‘‘(F) EFFECT OF INFRINGEMENT AC4 TION.—In the event that the reference product 

5 sponsor files a patent infringement suit, the use 

6 of confidential information shall continue to be 

7 governed by the terms of this paragraph until 

8 such time as a court enters a protective order 

9 regarding the information. Upon entry of such 

10 order, the subsection (k) applicant may redesig11 nate confidential information in accordance 

12 with the terms of that order. No confidential in13 formation shall be included in any publicly14 available complaint or other pleading. In the 

15 event that the reference product sponsor does 

16 not file an infringement action by the date spec17 ified in paragraph (6), the reference product 

18 sponsor shall return or destroy all confidential 

19 information received under this paragraph, pro20 vided that if the reference product sponsor opts 

21 to destroy such information, it will confirm de22 struction in writing to the subsection (k) appli23 cant. 

24 ‘‘(G) RULE OF CONSTRUCTION.—Nothing 

25 in this paragraph shall be construed— 


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1 ‘‘(i) as an admission by the subsection 

2 (k) applicant regarding the validity, en3 forceability, or infringement of any patent; 

4 or 

5 ‘‘(ii) as an agreement or admission by 

6 the subsection (k) applicant with respect to 

7 the competency, relevance, or materiality 

8 of any confidential information. 

9 ‘‘(H) EFFECT OF VIOLATION.—The disclo10 sure of any confidential information in violation 

11 of this paragraph shall be deemed to cause the 

12 subsection (k) applicant to suffer irreparable 

13 harm for which there is no adequate legal rem14 edy and the court shall consider immediate in15 junctive relief to be an appropriate and nec16 essary remedy for any violation or threatened 

17 violation of this paragraph. 

18 ‘‘(2) SUBSECTION (k) APPLICATION INFORMA19 TION.—Not later than 20 days after the Secretary 

20 notifies the subsection (k) applicant that the applica21 tion has been accepted for review, the subsection (k) 

22 applicant— 

23 ‘‘(A) shall provide to the reference product 

24 sponsor a copy of the application submitted to 

25 the Secretary under subsection (k), and such 


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1 other information that describes the process or 

2 processes used to manufacture the biological 

3 product that is the subject of such application; 

4 and 

5 ‘‘(B) may provide to the reference product 

6 sponsor additional information requested by or 

7 on behalf of the reference product sponsor. 

8 ‘‘(3) LIST AND DESCRIPTION OF PATENTS.— 

9 ‘‘(A) LIST BY REFERENCE PRODUCT SPON10 SOR.—Not later than 60 days after the receipt 

11 of the application and information under para12 graph (2), the reference product sponsor shall 

13 provide to the subsection (k) applicant— 

14 ‘‘(i) a list of patents for which the ref15 erence product sponsor believes a claim of 

16 patent infringement could reasonably be 

17 asserted by the reference product sponsor, 

18 or by a patent owner that has granted an 

19 exclusive license to the reference product 

20 sponsor with respect to the reference prod21 uct, if a person not licensed by the ref22 erence product sponsor engaged in the 

23 making, using, offering to sell, selling, or 

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1 ological product that is the subject of the 

2 subsection (k) application; and 

3 ‘‘(ii) an identification of the patents 

4 on such list that the reference product 

5 sponsor would be prepared to license to the 

6 subsection (k) applicant. 

7 ‘‘(B) LIST AND DESCRIPTION BY SUB8 SECTION (k) APPLICANT.—Not later than 60 

9 days after receipt of the list under subpara10 graph (A), the subsection (k) applicant— 

11 ‘‘(i) may provide to the reference 

12 product sponsor a list of patents to which 

13 the subsection (k) applicant believes a 

14 claim of patent infringement could reason15 ably be asserted by the reference product 

16 sponsor if a person not licensed by the ref17 erence product sponsor engaged in the 

18 making, using, offering to sell, selling, or 

19 importing into the United States of the bi20 ological product that is the subject of the 

21 subsection (k) application; 

22 ‘‘(ii) shall provide to the reference 

23 product sponsor, with respect to each pat24 ent listed by the reference product sponsor 


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1 under subparagraph (A) or listed by the 

2 subsection (k) applicant under clause (i)— 

3 ‘‘(I) a detailed statement that de4 scribes, on a claim by claim basis, the 

5 factual and legal basis of the opinion 

6 of the subsection (k) applicant that 

7 such patent is invalid, unenforceable, 

8 or will not be infringed by the com9 mercial marketing of the biological 

10 product that is the subject of the sub11 section (k) application; or 

12 ‘‘(II) a statement that the sub13 section (k) applicant does not intend 

14 to begin commercial marketing of the 

15 biological product before the date that 

16 such patent expires; and 

17 ‘‘(iii) shall provide to the reference 

18 product sponsor a response regarding each 

19 patent identified by the reference product 

20 sponsor under subparagraph (A)(ii). 

21 ‘‘(C) DESCRIPTION BY REFERENCE PROD22 UCT SPONSOR.—Not later than 60 days after 

23 receipt of the list and statement under subpara24 graph (B), the reference product sponsor shall 

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1 tailed statement that describes, with respect to 

2 each patent described in subparagraph 

3 (B)(ii)(I), on a claim by claim basis, the factual 

4 and legal basis of the opinion of the reference 

5 product sponsor that such patent will be in6 fringed by the commercial marketing of the bio7 logical product that is the subject of the sub8 section (k) application and a response to the 

9 statement concerning validity and enforceability 

10 provided under subparagraph (B)(ii)(I). 

11 ‘‘(4) PATENT RESOLUTION NEGOTIATIONS.— 

12 ‘‘(A) IN GENERAL.—After receipt by the 

13 subsection (k) applicant of the statement under 

14 paragraph (3)(C), the reference product spon15 sor and the subsection (k) applicant shall en16 gage in good faith negotiations to agree on 

17 which, if any, patents listed under paragraph 

18 (3) by the subsection (k) applicant or the ref19 erence product sponsor shall be the subject of 

20 an action for patent infringement under para21 graph (6). 

22 ‘‘(B) FAILURE TO REACH AGREEMENT.— 

23 If, within 15 days of beginning negotiations 

24 under subparagraph (A), the subsection (k) ap25 plicant and the reference product sponsor fail to 


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1 agree on a final and complete list of which, if 

2 any, patents listed under paragraph (3) by the 

3 subsection (k) applicant or the reference prod4 uct sponsor shall be the subject of an action for 

5 patent infringement under paragraph (6), the 

6 provisions of paragraph (5) shall apply to the 

7 parties. 

8 ‘‘(5) PATENT RESOLUTION IF NO AGREE9 MENT.— 

10 ‘‘(A) NUMBER OF PATENTS.—The sub11 section (k) applicant shall notify the reference 

12 product sponsor of the number of patents that 

13 such applicant will provide to the reference 

14 product sponsor under subparagraph (B)(i)(I). 

15 ‘‘(B) EXCHANGE OF PATENT LISTS.— 

16 ‘‘(i) IN GENERAL.—On a date agreed 

17 to by the subsection (k) applicant and the 

18 reference product sponsor, but in no case 

19 later than 5 days after the subsection (k) 

20 applicant notifies the reference product 

21 sponsor under subparagraph (A), the sub22 section (k) applicant and the reference 

23 product sponsor shall simultaneously ex24 change— 


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1 ‘‘(I) the list of patents that the 

2 subsection (k) applicant believes 

3 should be the subject of an action for 

4 patent infringement under paragraph 

5 (6); and 

6 ‘‘(II) the list of patents, in ac7 cordance with clause (ii), that the ref8 erence product sponsor believes should 

9 be the subject of an action for patent 

10 infringement under paragraph (6). 

11 ‘‘(ii) NUMBER OF PATENTS LISTED BY

12 REFERENCE PRODUCT SPONSOR.— 

13 ‘‘(I) IN GENERAL.—Subject to 

14 subclause (II), the number of patents 

15 listed by the reference product spon16 sor under clause (i)(II) may not ex17 ceed the number of patents listed by 

18 the subsection (k) applicant under 

19 clause (i)(I). 

20 ‘‘(II) EXCEPTION.—If a sub21 section (k) applicant does not list any 

22 patent under clause (i)(I), the ref23 erence product sponsor may list 1 pat24 ent under clause (i)(II). 


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1 ‘‘(6) IMMEDIATE PATENT INFRINGEMENT AC2 TION.— 

3 ‘‘(A) ACTION IF AGREEMENT ON PATENT

4 LIST.—If the subsection (k) applicant and the 

5 reference product sponsor agree on patents as 

6 described in paragraph (4), not later than 30 

7 days after such agreement, the reference prod8 uct sponsor shall bring an action for patent in9 fringement with respect to each such patent. 

10 ‘‘(B) ACTION IF NO AGREEMENT ON PAT11 ENT LIST.—If the provisions of paragraph (5) 

12 apply to the parties as described in paragraph 

13 (4)(B), not later than 30 days after the ex14 change of lists under paragraph (5)(B), the ref15 erence product sponsor shall bring an action for 

16 patent infringement with respect to each patent 

17 that is included on such lists. 

18 ‘‘(C) NOTIFICATION AND PUBLICATION OF

19 COMPLAINT.— 

20 ‘‘(i) NOTIFICATION TO SECRETARY.— 

21 Not later than 30 days after a complaint 

22 is served to a subsection (k) applicant in 

23 an action for patent infringement described 

24 under this paragraph, the subsection (k) 


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1 applicant shall provide the Secretary with 

2 notice and a copy of such complaint. 

3 ‘‘(ii) PUBLICATION BY SECRETARY.— 

4 The Secretary shall publish in the Federal 

5 Register notice of a complaint received 

6 under clause (i). 

7 ‘‘(7) NEWLY ISSUED OR LICENSED PATENTS.— 

8 In the case of a patent that— 

9 ‘‘(A) is issued to, or exclusively licensed by, 

10 the reference product sponsor after the date 

11 that the reference product sponsor provided the 

12 list to the subsection (k) applicant under para13 graph (3)(A); and 

14 ‘‘(B) the reference product sponsor reason15 ably believes that, due to the issuance of such 

16 patent, a claim of patent infringement could 

17 reasonably be asserted by the reference product 

18 sponsor if a person not licensed by the ref19 erence product sponsor engaged in the making, 

20 using, offering to sell, selling, or importing into 

21 the United States of the biological product that 

22 is the subject of the subsection (k) application, 

23 not later than 30 days after such issuance or licens24 ing, the reference product sponsor shall provide to 

25 the subsection (k) applicant a supplement to the list 


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1 provided by the reference product sponsor under 

2 paragraph (3)(A) that includes such patent, not 

3 later than 30 days after such supplement is pro4 vided, the subsection (k) applicant shall provide a 

5 statement to the reference product sponsor in ac6 cordance with paragraph (3)(B), and such patent 

7 shall be subject to paragraph (8). 

8 ‘‘(8) NOTICE OF COMMERCIAL MARKETING AND

9 PRELIMINARY INJUNCTION.— 

10 ‘‘(A) NOTICE OF COMMERCIAL MAR11 KETING.—The subsection (k) applicant shall 

12 provide notice to the reference product sponsor 

13 not later than 180 days before the date of the 

14 first commercial marketing of the biological 

15 product licensed under subsection (k). 

16 ‘‘(B) PRELIMINARY INJUNCTION.—After 

17 receiving the notice under subparagraph (A) 

18 and before such date of the first commercial 

19 marketing of such biological product, the ref20 erence product sponsor may seek a preliminary 

21 injunction prohibiting the subsection (k) appli22 cant from engaging in the commercial manufac23 ture or sale of such biological product until the 

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1 forcement, and infringement with respect to any 

2 patent that is— 

3 ‘‘(i) included in the list provided by 

4 the reference product sponsor under para5 graph (3)(A) or in the list provided by the 

6 subsection (k) applicant under paragraph 

7 (3)(B); and 

8 ‘‘(ii) not included, as applicable, on— 

9 ‘‘(I) the list of patents described 

10 in paragraph (4); or 

11 ‘‘(II) the lists of patents de12 scribed in paragraph (5)(B). 

13 ‘‘(C) REASONABLE COOPERATION.—If the 

14 reference product sponsor has sought a prelimi15 nary injunction under subparagraph (B), the 

16 reference product sponsor and the subsection 

17 (k) applicant shall reasonably cooperate to ex18 pedite such further discovery as is needed in 

19 connection with the preliminary injunction mo20 tion. 

21 ‘‘(9) LIMITATION ON DECLARATORY JUDGMENT

22 ACTION.— 

23 ‘‘(A) SUBSECTION (k) APPLICATION PRO24 VIDED.—If a subsection (k) applicant provides 

25 the application and information required under 


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1 paragraph (2)(A), neither the reference product 

2 sponsor nor the subsection (k) applicant may, 

3 prior to the date notice is received under para4 graph (8)(A), bring any action under section 

5 2201 of title 28, United States Code, for a dec6 laration of infringement, validity, or enforce7 ability of any patent that is described in clauses 

8 (i) and (ii) of paragraph (8)(B). 

9 ‘‘(B) SUBSEQUENT FAILURE TO ACT BY

10 SUBSECTION (k) APPLICANT.—If a subsection 

11 (k) applicant fails to complete an action re12 quired of the subsection (k) applicant under 

13 paragraph (3)(B)(ii), paragraph (5), paragraph 

14 (6)(C)(i), paragraph (7), or paragraph (8)(A), 

15 the reference product sponsor, but not the sub16 section (k) applicant, may bring an action 

17 under section 2201 of title 28, United States 

18 Code, for a declaration of infringement, validity, 

19 or enforceability of any patent included in the 

20 list described in paragraph (3)(A), including as 

21 provided under paragraph (7). 

22 ‘‘(C) SUBSECTION (k) APPLICATION NOT

23 PROVIDED.—If a subsection (k) applicant fails 

24 to provide the application and information re25 quired under paragraph (2)(A), the reference 


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1 product sponsor, but not the subsection (k) ap2 plicant, may bring an action under section 2201 

3 of title 28, United States Code, for a declara4 tion of infringement, validity, or enforceability 

5 of any patent that claims the biological product 

6 or a use of the biological product.’’. 

7 (b) DEFINITIONS.—Section 351(i) of the Public 

8 Health Service Act (42 U.S.C. 262(i)) is amended— 

9 (1) by striking ‘‘In this section, the term ‘bio10 logical product’ means’’ and inserting the following: 

11 ‘‘In this section: 

12 ‘‘(1) The term ‘biological product’ means’’; 

13 (2) in paragraph (1), as so designated, by in14 serting ‘‘protein (except any chemically synthesized 

15 polypeptide),’’ after ‘‘allergenic product,’’; and 

16 (3) by adding at the end the following: 

17 ‘‘(2) The term ‘biosimilar’ or ‘biosimilarity’, in 

18 reference to a biological product that is the subject 

19 of an application under subsection (k), means— 

20 ‘‘(A) that the biological product is highly 

21 similar to the reference product notwith22 standing minor differences in clinically inactive 

23 components; and 

24 ‘‘(B) there are no clinically meaningful dif25 ferences between the biological product and the 


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1 reference product in terms of the safety, purity, 

2 and potency of the product. 

3 ‘‘(3) The term ‘interchangeable’ or ‘inter4 changeability’, in reference to a biological product 

5 that is shown to meet the standards described in 

6 subsection (k)(4), means that the biological product 

7 may be substituted for the reference product without 

8 the intervention of the health care provider who pre9 scribed the reference product. 

10 ‘‘(4) The term ‘reference product’ means the 

11 single biological product licensed under subsection 

12 (a) against which a biological product is evaluated in 

13 an application submitted under subsection (k).’’. 

14 (c) CONFORMING AMENDMENTS RELATING TO PAT15 ENTS.— 

16 (1) PATENTS.—Section 271(e) of title 35, 

17 United States Code, is amended— 

18 (A) in paragraph (2)— 

19 (i) in subparagraph (A), by striking 

20 ‘‘or’’ at the end; 

21 (ii) in subparagraph (B), by adding 

22 ‘‘or’’ at the end; and 

23 (iii) by inserting after subparagraph 

24 (B) the following: 


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1 ‘‘(C)(i) with respect to a patent that is identi2 fied in the list of patents described in section 

3 351(l)(3) of the Public Health Service Act (including 

4 as provided under section 351(l)(7) of such Act), an 

5 application seeking approval of a biological product, 

6 or 

7 ‘‘(ii) if the applicant for the application fails to 

8 provide the application and information required 

9 under section 351(l)(2)(A) of such Act, an applica10 tion seeking approval of a biological product for a 

11 patent that could be identified pursuant to section 

12 351(l)(3)(A)(i) of such Act,’’; and 

13 (iv) in the matter following subpara14 graph (C) (as added by clause (iii)), by 

15 striking ‘‘or veterinary biological product’’ 

16 and inserting ‘‘, veterinary biological prod17 uct, or biological product’’; 

18 (B) in paragraph (4)— 

19 (i) in subparagraph (B), by— 

20 (I) striking ‘‘or veterinary bio21 logical product’’ and inserting ‘‘, vet22 erinary biological product, or biologi23 cal product’’; and 

24 (II) striking ‘‘and’’ at the end; 

25 (ii) in subparagraph (C), by— 


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1 (I) striking ‘‘or veterinary bio2 logical product’’ and inserting ‘‘, vet3 erinary biological product, or biologi4 cal product’’; and 

5 (II) striking the period and in6 serting ‘‘, and’’; 

7 (iii) by inserting after subparagraph 

8 (C) the following: 

9 ‘‘(D) the court shall order a permanent injunc10 tion prohibiting any infringement of the patent by 

11 the biological product involved in the infringement 

12 until a date which is not earlier than the date of the 

13 expiration of the patent that has been infringed 

14 under paragraph (2)(C), provided the patent is the 

15 subject of a final court decision, as defined in sec16 tion 351(k)(6) of the Public Health Service Act, in 

17 an action for infringement of the patent under sec18 tion 351(l)(6) of such Act, and the biological prod19 uct has not yet been approved because of section 

20 351(k)(7) of such Act.’’; and 

21 (iv) in the matter following subpara22 graph (D) (as added by clause (iii)), by 

23 striking ‘‘and (C)’’ and inserting ‘‘(C), and 

24 (D)’’; and 

25 (C) by adding at the end the following: 


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1 ‘‘(6)(A) Subparagraph (B) applies, in lieu of para2 graph (4), in the case of a patent— 

3 ‘‘(i) that is identified, as applicable, in the list 

4 of patents described in section 351(l)(4) of the Pub5 lic Health Service Act or the lists of patents de6 scribed in section 351(l)(5)(B) of such Act with re7 spect to a biological product; and 

8 ‘‘(ii) for which an action for infringement of the 

9 patent with respect to the biological product— 

10 ‘‘(I) was brought after the expiration of 

11 the 30-day period described in subparagraph 

12 (A) or (B), as applicable, of section 351(l)(6) of 

13 such Act; or 

14 ‘‘(II) was brought before the expiration of 

15 the 30-day period described in subclause (I), 

16 but which was dismissed without prejudice or 

17 was not prosecuted to judgment in good faith. 

18 ‘‘(B) In an action for infringement of a patent de19 scribed in subparagraph (A), the sole and exclusive remedy 

20 that may be granted by a court, upon a finding that the 

21 making, using, offering to sell, selling, or importation into 

22 the United States of the biological product that is the sub23 ject of the action infringed the patent, shall be a reason24 able royalty. 


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1 ‘‘(C) The owner of a patent that should have been 

2 included in the list described in section 351(l)(3)(A) of 

3 the Public Health Service Act, including as provided under 

4 section 351(l)(7) of such Act for a biological product, but 

5 was not timely included in such list, may not bring an 

6 action under this section for infringement of the patent 

7 with respect to the biological product.’’. 

8 (2) CONFORMING AMENDMENT UNDER TITLE

9 28.—Section 2201(b) of title 28, United States 

10 Code, is amended by inserting before the period the 

11 following: ‘‘, or section 351 of the Public Health 

12 Service Act’’. 

13 (d) CONFORMING AMENDMENTS UNDER THE FED14 ERAL FOOD, DRUG, AND COSMETIC ACT.— 

15 (1) CONTENT AND REVIEW OF APPLICA16 TIONS.—Section 505(b)(5)(B) of the Federal Food, 

17 Drug, and Cosmetic Act (21 U.S.C. 355(b)(5)(B)) is 

18 amended by inserting before the period at the end 

19 of the first sentence the following: ‘‘or, with respect 

20 to an applicant for approval of a biological product 

21 under section 351(k) of the Public Health Service 

22 Act, any necessary clinical study or studies’’. 

23 (2) NEW ACTIVE INGREDIENT.—Section 505B 

24 of the Federal Food, Drug, and Cosmetic Act (21 


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1 U.S.C. 355c) is amended by adding at the end the 

2 following: 

3 ‘‘(n) NEW ACTIVE INGREDIENT.— 

4 ‘‘(1) NON-INTERCHANGEABLE BIOSIMILAR BIO5 LOGICAL PRODUCT.—A biological product that is 

6 biosimilar to a reference product under section 351 

7 of the Public Health Service Act, and that the Sec8 retary has not determined to meet the standards de9 scribed in subsection (k)(4) of such section for inter10 changeability with the reference product, shall be 

11 considered to have a new active ingredient under 

12 this section. 

13 ‘‘(2) INTERCHANGEABLE BIOSIMILAR BIOLOGI14 CAL PRODUCT.—A biological product that is inter15 changeable with a reference product under section 

16 351 of the Public Health Service Act shall not be 

17 considered to have a new active ingredient under 

18 this section.’’. 

19 (e) PRODUCTS PREVIOUSLY APPROVED UNDER SEC20 TION 505.— 

21 (1) REQUIREMENT TO FOLLOW SECTION 351.— 

22 Except as provided in paragraph (2), an application 

23 for a biological product shall be submitted under 

24 section 351 of the Public Health Service Act (42 

25 U.S.C. 262) (as amended by this Act). 


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1 (2) EXCEPTION.—An application for a biologi2 cal product may be submitted under section 505 of 

3 the Federal Food, Drug, and Cosmetic Act (21 

4 U.S.C. 355) if— 

5 (A) such biological product is in a product 

6 class for which a biological product in such 

7 product class is the subject of an application 

8 approved under such section 505 not later than 

9 the date of enactment of this Act; and 

10 (B) such application— 

11 (i) has been submitted to the Sec12 retary of Health and Human Services (re13 ferred to in this subtitle as the ‘‘Sec14 retary’’) before the date of enactment of 

15 this Act; or 

16 (ii) is submitted to the Secretary not 

17 later than the date that is 10 years after 

18 the date of enactment of this Act. 

19 (3) LIMITATION.—Notwithstanding paragraph 

20 (2), an application for a biological product may not 

21 be submitted under section 505 of the Federal Food, 

22 Drug, and Cosmetic Act (21 U.S.C. 355) if there is 

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1 spect to such application (within the meaning of 

2 such section 351) if such application were submitted 

3 under subsection (k) of such section 351. 

4 (4) DEEMED APPROVED UNDER SECTION

5 351.—An approved application for a biological prod6 uct under section 505 of the Federal Food, Drug, 

7 and Cosmetic Act (21 U.S.C. 355) shall be deemed 

8 to be a license for the biological product under such 

9 section 351 on the date that is 10 years after the 

10 date of enactment of this Act. 

11 (5) DEFINITIONS.—For purposes of this sub12 section, the term ‘‘biological product’’ has the mean13 ing given such term under section 351 of the Public 

14 Health Service Act (42 U.S.C. 262) (as amended by 

15 this Act). 

16 (f) FOLLOW-ON BIOLOGICS USER FEES.— 

17 (1) DEVELOPMENT OF USER FEES FOR BIO18 SIMILAR BIOLOGICAL PRODUCTS.— 

19 (A) IN GENERAL.—Beginning not later 

20 than October 1, 2010, the Secretary shall de21 velop recommendations to present to Congress 

22 with respect to the goals, and plans for meeting 

23 the goals, for the process for the review of bio24 similar biological product applications sub25 mitted under section 351(k) of the Public 


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1 Health Service Act (as added by this Act) for 

2 the first 5 fiscal years after fiscal year 2012. In 

3 developing such recommendations, the Sec4 retary shall consult with— 

5 (i) the Committee on Health, Edu6 cation, Labor, and Pensions of the Senate; 

7 (ii) the Committee on Energy and 

8 Commerce of the House of Representa9 tives; 

10 (iii) scientific and academic experts; 

11 (iv) health care professionals; 

12 (v) representatives of patient and con13 sumer advocacy groups; and 

14 (vi) the regulated industry. 

15 (B) PUBLIC REVIEW OF RECOMMENDA16 TIONS.—After negotiations with the regulated 

17 industry, the Secretary shall— 

18 (i) present the recommendations de19 veloped under subparagraph (A) to the 

20 Congressional committees specified in such 

21 subparagraph; 

22 (ii) publish such recommendations in 

23 the Federal Register; 


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1 (iii) provide for a period of 30 days 

2 for the public to provide written comments 

3 on such recommendations; 

4 (iv) hold a meeting at which the pub5 lic may present its views on such rec6 ommendations; and 

7 (v) after consideration of such public 

8 views and comments, revise such rec9 ommendations as necessary. 

10 (C) TRANSMITTAL OF RECOMMENDA11 TIONS.—Not later than January 15, 2012, the 

12 Secretary shall transmit to Congress the revised 

13 recommendations under subparagraph (B), a 

14 summary of the views and comments received 

15 under such subparagraph, and any changes 

16 made to the recommendations in response to 

17 such views and comments. 

18 (2) ESTABLISHMENT OF USER FEE PRO19 GRAM.—It is the sense of the Senate that, based on 

20 the recommendations transmitted to Congress by the 

21 Secretary pursuant to paragraph (1)(C), Congress 

22 should authorize a program, effective on October 1, 

23 2012, for the collection of user fees relating to the 

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1 tions under section 351(k) of the Public Health 

2 Service Act (as added by this Act). 

3 (3) TRANSITIONAL PROVISIONS FOR USER FEES

4 FOR BIOSIMILAR BIOLOGICAL PRODUCTS.— 

5 (A) APPLICATION OF THE PRESCRIPTION

6 DRUG USER FEE PROVISIONS.—Section 

7 735(1)(B) of the Federal Food, Drug, and Cos8 metic Act (21 U.S.C. 379g(1)(B)) is amended 

9 by striking ‘‘section 351’’ and inserting ‘‘sub10 section (a) or (k) of section 351’’. 

11 (B) EVALUATION OF COSTS OF REVIEWING

12 BIOSIMILAR BIOLOGICAL PRODUCT APPLICA13 TIONS.—During the period beginning on the 

14 date of enactment of this Act and ending on 

15 October 1, 2010, the Secretary shall collect and 

16 evaluate data regarding the costs of reviewing 

17 applications for biological products submitted 

18 under section 351(k) of the Public Health Serv19 ice Act (as added by this Act) during such pe20 riod. 

21 (C) AUDIT.— 

22 (i) IN GENERAL.—On the date that is 

23 2 years after first receiving a user fee ap24 plicable to an application for a biological 

25 product under section 351(k) of the Public 


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1 Health Service Act (as added by this Act), 

2 and on a biennial basis thereafter until Oc3 tober 1, 2013, the Secretary shall perform 

4 an audit of the costs of reviewing such ap5 plications under such section 351(k). Such 

6 an audit shall compare— 

7 (I) the costs of reviewing such 

8 applications under such section 

9 351(k) to the amount of the user fee 

10 applicable to such applications; and 

11 (II)(aa) such ratio determined 

12 under subclause (I); to 

13 (bb) the ratio of the costs of re14 viewing applications for biological 

15 products under section 351(a) of such 

16 Act (as amended by this Act) to the 

17 amount of the user fee applicable to 

18 such applications under such section 

19 351(a). 

20 (ii) ALTERATION OF USER FEE.—If 

21 the audit performed under clause (i) indi22 cates that the ratios compared under sub23 clause (II) of such clause differ by more 

24 than 5 percent, then the Secretary shall 

25 alter the user fee applicable to applications 


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1 submitted under such section 351(k) to 

2 more appropriately account for the costs of 

3 reviewing such applications. 

4 (iii) ACCOUNTING STANDARDS.—The 

5 Secretary shall perform an audit under 

6 clause (i) in conformance with the account7 ing principles, standards, and requirements 

8 prescribed by the Comptroller General of 

9 the United States under section 3511 of 

10 title 31, United State Code, to ensure the 

11 validity of any potential variability. 

12 (4) AUTHORIZATION OF APPROPRIATIONS.— 

13 There is authorized to be appropriated to carry out 

14 this subsection such sums as may be necessary for 

15 each of fiscal years 2010 through 2012. 

16 (g) PEDIATRIC STUDIES OF BIOLOGICAL PROD17 UCTS.— 

18 (1) IN GENERAL.—Section 351 of the Public 

19 Health Service Act (42 U.S.C. 262) is amended by 

20 adding at the end the following: 

21 ‘‘(m) PEDIATRIC STUDIES.— 

22 ‘‘(1) APPLICATION OF CERTAIN PROVISIONS.— 

23 The provisions of subsections (a), (d), (e), (f), (i), 

24 (j), (k), (l), (p), and (q) of section 505A of the Fed25 eral Food, Drug, and Cosmetic Act shall apply with 


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1 respect to the extension of a period under para2 graphs (2) and (3) to the same extent and in the 

3 same manner as such provisions apply with respect 

4 to the extension of a period under subsection (b) or 

5 (c) of section 505A of the Federal Food, Drug, and 

6 Cosmetic Act. 

7 ‘‘(2) MARKET EXCLUSIVITY FOR NEW BIOLOGI8 CAL PRODUCTS.—If, prior to approval of an applica9 tion that is submitted under subsection (a), the Sec10 retary determines that information relating to the 

11 use of a new biological product in the pediatric pop12 ulation may produce health benefits in that popu13 lation, the Secretary makes a written request for pe14 diatric studies (which shall include a timeframe for 

15 completing such studies), the applicant agrees to the 

16 request, such studies are completed using appro17 priate formulations for each age group for which the 

18 study is requested within any such timeframe, and 

19 the reports thereof are submitted and accepted in 

20 accordance with section 505A(d)(3) of the Federal 

21 Food, Drug, and Cosmetic Act— 

22 ‘‘(A) the periods for such biological prod23 uct referred to in subsection (k)(7) are deemed 

24 to be 4 years and 6 months rather than 4 years 


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1 and 12 years and 6 months rather than 12 

2 years; and 

3 ‘‘(B) if the biological product is designated 

4 under section 526 for a rare disease or condi5 tion, the period for such biological product re6 ferred to in section 527(a) is deemed to be 7 

7 years and 6 months rather than 7 years. 

8 ‘‘(3) MARKET EXCLUSIVITY FOR ALREADY-MAR9 KETED BIOLOGICAL PRODUCTS.—If the Secretary 

10 determines that information relating to the use of a 

11 licensed biological product in the pediatric popu12 lation may produce health benefits in that popu13 lation and makes a written request to the holder of 

14 an approved application under subsection (a) for pe15 diatric studies (which shall include a timeframe for 

16 completing such studies), the holder agrees to the 

17 request, such studies are completed using appro18 priate formulations for each age group for which the 

19 study is requested within any such timeframe, and 

20 the reports thereof are submitted and accepted in 

21 accordance with section 505A(d)(3) of the Federal 

22 Food, Drug, and Cosmetic Act— 

23 ‘‘(A) the periods for such biological prod24 uct referred to in subsection (k)(7) are deemed 

25 to be 4 years and 6 months rather than 4 years 


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1 and 12 years and 6 months rather than 12 

2 years; and 

3 ‘‘(B) if the biological product is designated 

4 under section 526 for a rare disease or condi5 tion, the period for such biological product re6 ferred to in section 527(a) is deemed to be 7 

7 years and 6 months rather than 7 years. 

8 ‘‘(4) EXCEPTION.—The Secretary shall not ex9 tend a period referred to in paragraph (2)(A), 

10 (2)(B), (3)(A), or (3)(B) if the determination under 

11 section 505A(d)(3) is made later than 9 months 

12 prior to the expiration of such period.’’. 

13 (2) STUDIES REGARDING PEDIATRIC RE14 SEARCH.— 

15 (A) PROGRAM FOR PEDIATRIC STUDY OF

16 DRUGS.—Subsection (a)(1) of section 409I of 

17 the Public Health Service Act (42 U.S.C. 

18 284m) is amended by inserting ‘‘, biological 

19 products,’’ after ‘‘including drugs’’. 

20 (B) INSTITUTE OF MEDICINE STUDY.— 

21 Section 505A(p) of the Federal Food, Drug, 

22 and Cosmetic Act (21 U.S.C. 355b(p)) is 

23 amended by striking paragraphs (4) and (5) 

24 and inserting the following: 


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1 ‘‘(4) review and assess the number and impor2 tance of biological products for children that are 

3 being tested as a result of the amendments made by 

4 the Biologics Price Competition and Innovation Act 

5 of 2009 and the importance for children, health care 

6 providers, parents, and others of labeling changes 

7 made as a result of such testing; 

8 ‘‘(5) review and assess the number, importance, 

9 and prioritization of any biological products that are 

10 not being tested for pediatric use; and 

11 ‘‘(6) offer recommendations for ensuring pedi12 atric testing of biological products, including consid13 eration of any incentives, such as those provided 

14 under this section or section 351(m) of the Public 

15 Health Service Act.’’. 

16 (h) ORPHAN PRODUCTS.—If a reference product, as 

17 defined in section 351 of the Public Health Service Act 

18 (42 U.S.C. 262) (as amended by this Act) has been des19 ignated under section 526 of the Federal Food, Drug, and 

20 Cosmetic Act (21 U.S.C. 360bb) for a rare disease or con21 dition, a biological product seeking approval for such dis22 ease or condition under subsection (k) of such section 351 

23 as biosimilar to, or interchangeable with, such reference 

24 product may be licensed by the Secretary only after the 

25 expiration for such reference product of the later of— 


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1 (1) the 7-year period described in section 

2 527(a) of the Federal Food, Drug, and Cosmetic Act 

3 (21 U.S.C. 360cc(a)); and 

4 (2) the 12-year period described in subsection 

5 (k)(7) of such section 351. 

6 SEC. 7003. SAVINGS. 

7 (a) DETERMINATION.—The Secretary of the Treas8 ury, in consultation with the Secretary of Health and 

9 Human Services, shall for each fiscal year determine the 

10 amount of savings to the Federal Government as a result 

11 of the enactment of this subtitle. 

12 (b) USE.—Notwithstanding any other provision of 

13 this subtitle (or an amendment made by this subtitle), the 

14 savings to the Federal Government generated as a result 

15 of the enactment of this subtitle shall be used for deficit 

16 reduction. 

17 Subtitle B—More Affordable Medi18 cines for Children and Under19 served Communities 

20 SEC. 7101. EXPANDED PARTICIPATION IN 340B PROGRAM. 

21 (a) EXPANSION OF COVERED ENTITIES RECEIVING

22 DISCOUNTED PRICES.—Section 340B(a)(4) of the Public 

23 Health Service Act (42 U.S.C. 256b(a)(4)) is amended by 

24 adding at the end the following: 


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1 ‘‘(M) A children’s hospital excluded from 

2 the Medicare prospective payment system pur3 suant to section 1886(d)(1)(B)(iii) of the Social 

4 Security Act, or a free-standing cancer hospital 

5 excluded from the Medicare prospective pay6 ment system pursuant to section 

7 1886(d)(1)(B)(v) of the Social Security Act, 

8 that would meet the requirements of subpara9 graph (L), including the disproportionate share 

10 adjustment percentage requirement under 

11 clause (ii) of such subparagraph, if the hospital 

12 were a subsection (d) hospital as defined by sec13 tion 1886(d)(1)(B) of the Social Security Act. 

14 ‘‘(N) An entity that is a critical access hos15 pital (as determined under section 1820(c)(2) 

16 of the Social Security Act), and that meets the 

17 requirements of subparagraph (L)(i). 

18 ‘‘(O) An entity that is a rural referral cen19 ter, as defined by section 1886(d)(5)(C)(i) of 

20 the Social Security Act, or a sole community 

21 hospital, as defined by section 

22 1886(d)(5)(C)(iii) of such Act, and that both 

23 meets the requirements of subparagraph (L)(i) 

24 and has a disproportionate share adjustment 

25 percentage equal to or greater than 8 percent.’’. 


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1 (b) EXTENSION OF DISCOUNT TO INPATIENT

2 DRUGS.—Section 340B of the Public Health Service Act 

3 (42 U.S.C. 256b) is amended— 

4 (1) in paragraphs (2), (5), (7), and (9) of sub5 section (a), by striking ‘‘outpatient’’ each place it 

6 appears; and 

7 (2) in subsection (b)— 

8 (A) by striking ‘‘OTHER DEFINITION’’ and 

9 all that follows through ‘‘In this section’’ and 

10 inserting the following: ‘‘OTHER DEFINI11 TIONS.— 

12 ‘‘(1) IN GENERAL.—In this section’’; and 

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

14 paragraph: 

15 ‘‘(2) COVERED DRUG.—In this section, the term 

16 ‘covered drug’— 

17 ‘‘(A) means a covered outpatient drug (as 

18 defined in section 1927(k)(2) of the Social Se19 curity Act); and 

20 ‘‘(B) includes, notwithstanding paragraph 

21 (3)(A) of section 1927(k) of such Act, a drug 

22 used in connection with an inpatient or out23 patient service provided by a hospital described 

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1 section (a)(4) that is enrolled to participate in 

2 the drug discount program under this section.’’. 

3 (c) PROHIBITION ON GROUP PURCHASING ARRANGE4 MENTS.—Section 340B(a) of the Public Health Service 

5 Act (42 U.S.C. 256b(a)) is amended— 

6 (1) in paragraph (4)(L)— 

7 (A) in clause (i), by adding ‘‘and’’ at the 

8 end; 

9 (B) in clause (ii), by striking ‘‘; and’’ and 

10 inserting a period; and 

11 (C) by striking clause (iii); and 

12 (2) in paragraph (5), as amended by subsection 

13 (b)— 

14 (A) by redesignating subparagraphs (C) 

15 and (D) as subparagraphs (D) and (E); respec16 tively; and 

17 (B) by inserting after subparagraph (B), 

18 the following: 

19 ‘‘(C) PROHIBITION ON GROUP PURCHASING

20 ARRANGEMENTS.— 

21 ‘‘(i) IN GENERAL.—A hospital de22 scribed in subparagraph (L), (M), (N), or 

23 (O) of paragraph (4) shall not obtain cov24 ered outpatient drugs through a group 

25 purchasing organization or other group 


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1 purchasing arrangement, except as per2 mitted or provided for pursuant to clauses 

3 (ii) or (iii). 

4 ‘‘(ii) INPATIENT DRUGS.—Clause (i) 

5 shall not apply to drugs purchased for in6 patient use. 

7 ‘‘(iii) EXCEPTIONS.—The Secretary 

8 shall establish reasonable exceptions to 

9 clause (i)— 

10 ‘‘(I) with respect to a covered 

11 outpatient drug that is unavailable to 

12 be purchased through the program 

13 under this section due to a drug 

14 shortage problem, manufacturer non15 compliance, or any other circumstance 

16 beyond the hospital’s control; 

17 ‘‘(II) to facilitate generic substi18 tution when a generic covered out19 patient drug is available at a lower 

20 price; or 

21 ‘‘(III) to reduce in other ways 

22 the administrative burdens of man23 aging both inventories of drugs sub24 ject to this section and inventories of 

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1 tion, so long as the exceptions do not 

2 create a duplicate discount problem in 

3 violation of subparagraph (A) or a di4 version problem in violation of sub5 paragraph (B). 

6 ‘‘(iv) PURCHASING ARRANGEMENTS

7 FOR INPATIENT DRUGS.—The Secretary 

8 shall ensure that a hospital described in 

9 subparagraph (L), (M), (N), or (O) of sub10 section (a)(4) that is enrolled to partici11 pate in the drug discount program under 

12 this section shall have multiple options for 

13 purchasing covered drugs for inpatients, 

14 including by utilizing a group purchasing 

15 organization or other group purchasing ar16 rangement, establishing and utilizing its 

17 own group purchasing program, pur18 chasing directly from a manufacturer, and 

19 any other purchasing arrangements that 

20 the Secretary determines is appropriate to 

21 ensure access to drug discount pricing 

22 under this section for inpatient drugs tak23 ing into account the particular needs of 

24 small and rural hospitals.’’. 


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1 (d) MEDICAID CREDITS ON INPATIENT DRUGS.— 

2 Section 340B of the Public Health Service Act (42 U.S.C. 

3 256b) is amended by striking subsection (c) and inserting 

4 the following: 

5 ‘‘(c) MEDICAID CREDIT.—Not later than 90 days 

6 after the date of filing of the hospital’s most recently filed 

7 Medicare cost report, the hospital shall issue a credit as 

8 determined by the Secretary to the State Medicaid pro9 gram for inpatient covered drugs provided to Medicaid re10 cipients.’’. 

11 (e) EFFECTIVE DATES.— 

12 (1) IN GENERAL.—The amendments made by 

13 this section and section 7102 shall take effect on 

14 January 1, 2010, and shall apply to drugs pur15 chased on or after January 1, 2010. 

16 (2) EFFECTIVENESS.—The amendments made 

17 by this section and section 7102 shall be effective 

18 and shall be taken into account in determining 

19 whether a manufacturer is deemed to meet the re20 quirements of section 340B(a) of the Public Health 

21 Service Act (42 U.S.C. 256b(a)), notwithstanding 

22 any other provision of law. 


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1 SEC. 7102. IMPROVEMENTS TO 340B PROGRAM INTEGRITY. 

2 (a) INTEGRITY IMPROVEMENTS.—Subsection (d) of 

3 section 340B of the Public Health Service Act (42 U.S.C. 

4 256b) is amended to read as follows: 

5 ‘‘(d) IMPROVEMENTS IN PROGRAM INTEGRITY.— 

6 ‘‘(1) MANUFACTURER COMPLIANCE.— 

7 ‘‘(A) IN GENERAL.—From amounts appro8 priated under paragraph (4), the Secretary 

9 shall provide for improvements in compliance by 

10 manufacturers with the requirements of this 

11 section in order to prevent overcharges and 

12 other violations of the discounted pricing re13 quirements specified in this section. 

14 ‘‘(B) IMPROVEMENTS.—The improvements 

15 described in subparagraph (A) shall include the 

16 following: 

17 ‘‘(i) The development of a system to 

18 enable the Secretary to verify the accuracy 

19 of ceiling prices calculated by manufactur20 ers under subsection (a)(1) and charged to 

21 covered entities, which shall include the 

22 following: 

23 ‘‘(I) Developing and publishing 

24 through an appropriate policy or regu25 latory issuance, precisely defined 

26 standards and methodology for the 


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1 calculation of ceiling prices under 

2 such subsection. 

3 ‘‘(II) Comparing regularly the 

4 ceiling prices calculated by the Sec5 retary with the quarterly pricing data 

6 that is reported by manufacturers to 

7 the Secretary. 

8 ‘‘(III) Performing spot checks of 

9 sales transactions by covered entities. 

10 ‘‘(IV) Inquiring into the cause of 

11 any pricing discrepancies that may be 

12 identified and either taking, or requir13 ing manufacturers to take, such cor14 rective action as is appropriate in re15 sponse to such price discrepancies. 

16 ‘‘(ii) The establishment of procedures 

17 for manufacturers to issue refunds to cov18 ered entities in the event that there is an 

19 overcharge by the manufacturers, including 

20 the following: 

21 ‘‘(I) Providing the Secretary with 

22 an explanation of why and how the 

23 overcharge occurred, how the refunds 

24 will be calculated, and to whom the 

25 refunds will be issued. 


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1 ‘‘(II) Oversight by the Secretary 

2 to ensure that the refunds are issued 

3 accurately and within a reasonable pe4 riod of time, both in routine instances 

5 of retroactive adjustment to relevant 

6 pricing data and exceptional cir7 cumstances such as erroneous or in8 tentional overcharging for covered 

9 drugs. 

10 ‘‘(iii) The provision of access through 

11 the Internet website of the Department of 

12 Health and Human Services to the applica13 ble ceiling prices for covered drugs as cal14 culated and verified by the Secretary in ac15 cordance with this section, in a manner 

16 (such as through the use of password pro17 tection) that limits such access to covered 

18 entities and adequately assures security 

19 and protection of privileged pricing data 

20 from unauthorized re-disclosure. 

21 ‘‘(iv) The development of a mecha22 nism by which— 

23 ‘‘(I) rebates and other discounts 

24 provided by manufacturers to other 

25 purchasers subsequent to the sale of 


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1 covered drugs to covered entities are 

2 reported to the Secretary; and 

3 ‘‘(II) appropriate credits and re4 funds are issued to covered entities if 

5 such discounts or rebates have the ef6 fect of lowering the applicable ceiling 

7 price for the relevant quarter for the 

8 drugs involved. 

9 ‘‘(v) Selective auditing of manufactur10 ers and wholesalers to ensure the integrity 

11 of the drug discount program under this 

12 section. 

13 ‘‘(vi) The imposition of sanctions in 

14 the form of civil monetary penalties, 

15 which— 

16 ‘‘(I) shall be assessed according 

17 to standards established in regulations 

18 to be promulgated by the Secretary 

19 not later than 180 days after the date 

20 of enactment of the Patient Protec21 tion and Affordable Care Act; 

22 ‘‘(II) shall not exceed $5,000 for 

23 each instance of overcharging a cov24 ered entity that may have occurred; 

25 and 


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1 ‘‘(III) shall apply to any manu2 facturer with an agreement under this 

3 section that knowingly and inten4 tionally charges a covered entity a 

5 price for purchase of a drug that ex6 ceeds the maximum applicable price 

7 under subsection (a)(1). 

8 ‘‘(2) COVERED ENTITY COMPLIANCE.— 

9 ‘‘(A) IN GENERAL.—From amounts appro10 priated under paragraph (4), the Secretary 

11 shall provide for improvements in compliance by 

12 covered entities with the requirements of this 

13 section in order to prevent diversion and viola14 tions of the duplicate discount provision and 

15 other requirements specified under subsection 

16 (a)(5). 

17 ‘‘(B) IMPROVEMENTS.—The improvements 

18 described in subparagraph (A) shall include the 

19 following: 

20 ‘‘(i) The development of procedures to 

21 enable and require covered entities to regu22 larly update (at least annually) the infor23 mation on the Internet website of the De24 partment of Health and Human Services 

25 relating to this section. 


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1 ‘‘(ii) The development of a system for 

2 the Secretary to verify the accuracy of in3 formation regarding covered entities that is 

4 listed on the website described in clause 

5 (i). 

6 ‘‘(iii) The development of more de7 tailed guidance describing methodologies 

8 and options available to covered entities for 

9 billing covered drugs to State Medicaid 

10 agencies in a manner that avoids duplicate 

11 discounts pursuant to subsection (a)(5)(A). 

12 ‘‘(iv) The establishment of a single, 

13 universal, and standardized identification 

14 system by which each covered entity site 

15 can be identified by manufacturers, dis16 tributors, covered entities, and the Sec17 retary for purposes of facilitating the or18 dering, purchasing, and delivery of covered 

19 drugs under this section, including the 

20 processing of chargebacks for such drugs. 

21 ‘‘(v) The imposition of sanctions, in 

22 appropriate cases as determined by the 

23 Secretary, additional to those to which cov24 ered entities are subject under subsection 


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1 (a)(5)(E), through one or more of the fol2 lowing actions: 

3 ‘‘(I) Where a covered entity 

4 knowingly and intentionally violates 

5 subsection (a)(5)(B), the covered enti6 ty shall be required to pay a monetary 

7 penalty to a manufacturer or manu8 facturers in the form of interest on 

9 sums for which the covered entity is 

10 found liable under subsection 

11 (a)(5)(E), such interest to be com12 pounded monthly and equal to the 

13 current short term interest rate as de14 termined by the Federal Reserve for 

15 the time period for which the covered 

16 entity is liable. 

17 ‘‘(II) Where the Secretary deter18 mines a violation of subsection 

19 (a)(5)(B) was systematic and egre20 gious as well as knowing and inten21 tional, removing the covered entity 

22 from the drug discount program 

23 under this section and disqualifying 

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1 gram for a reasonable period of time 

2 to be determined by the Secretary. 

3 ‘‘(III) Referring matters to ap4 propriate Federal authorities within 

5 the Food and Drug Administration, 

6 the Office of Inspector General of De7 partment of Health and Human Serv8 ices, or other Federal agencies for 

9 consideration of appropriate action 

10 under other Federal statutes, such as 

11 the Prescription Drug Marketing Act 

12 (21 U.S.C. 353). 

13 ‘‘(3) ADMINISTRATIVE DISPUTE RESOLUTION

14 PROCESS.— 

15 ‘‘(A) IN GENERAL.—Not later than 180 

16 days after the date of enactment of the Patient 

17 Protection and Affordable Care Act, the Sec18 retary shall promulgate regulations to establish 

19 and implement an administrative process for 

20 the resolution of claims by covered entities that 

21 they have been overcharged for drugs purchased 

22 under this section, and claims by manufactur23 ers, after the conduct of audits as authorized by 

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1 propriate procedures for the provision of rem2 edies and enforcement of determinations made 

3 pursuant to such process through mechanisms 

4 and sanctions described in paragraphs (1)(B) 

5 and (2)(B). 

6 ‘‘(B) DEADLINES AND PROCEDURES.— 

7 Regulations promulgated by the Secretary 

8 under subparagraph (A) shall— 

9 ‘‘(i) designate or establish a decision10 making official or decision-making body 

11 within the Department of Health and 

12 Human Services to be responsible for re13 viewing and finally resolving claims by cov14 ered entities that they have been charged 

15 prices for covered drugs in excess of the 

16 ceiling price described in subsection (a)(1), 

17 and claims by manufacturers that viola18 tions of subsection (a)(5)(A) or (a)(5)(B) 

19 have occurred; 

20 ‘‘(ii) establish such deadlines and pro21 cedures as may be necessary to ensure that 

22 claims shall be resolved fairly, efficiently, 

23 and expeditiously; 

24 ‘‘(iii) establish procedures by which a 

25 covered entity may discover and obtain 


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1 such information and documents from 

2 manufacturers and third parties as may be 

3 relevant to demonstrate the merits of a 

4 claim that charges for a manufacturer’s 

5 product have exceeded the applicable ceil6 ing price under this section, and may sub7 mit such documents and information to the 

8 administrative official or body responsible 

9 for adjudicating such claim; 

10 ‘‘(iv) require that a manufacturer con11 duct an audit of a covered entity pursuant 

12 to subsection (a)(5)(D) as a prerequisite to 

13 initiating administrative dispute resolution 

14 proceedings against a covered entity; 

15 ‘‘(v) permit the official or body des16 ignated under clause (i), at the request of 

17 a manufacturer or manufacturers, to con18 solidate claims brought by more than one 

19 manufacturer against the same covered en20 tity where, in the judgment of such official 

21 or body, consolidation is appropriate and 

22 consistent with the goals of fairness and 

23 economy of resources; and 

24 ‘‘(vi) include provisions and proce25 dures to permit multiple covered entities to 


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1 jointly assert claims of overcharges by the 

2 same manufacturer for the same drug or 

3 drugs in one administrative proceeding, 

4 and permit such claims to be asserted on 

5 behalf of covered entities by associations or 

6 organizations representing the interests of 

7 such covered entities and of which the cov8 ered entities are members. 

9 ‘‘(C) FINALITY OF ADMINISTRATIVE RESO10 LUTION.—The administrative resolution of a 

11 claim or claims under the regulations promul12 gated under subparagraph (A) shall be a final 

13 agency decision and shall be binding upon the 

14 parties involved, unless invalidated by an order 

15 of a court of competent jurisdiction. 

16 ‘‘(4) AUTHORIZATION OF APPROPRIATIONS.— 

17 There are authorized to be appropriated to carry out 

18 this subsection, such sums as may be necessary for 

19 fiscal year 2010 and each succeeding fiscal year.’’. 

20 (b) CONFORMING AMENDMENTS.—Section 340B(a) 

21 of the Public Health Service Act (42 U.S.C. 256b(a)) is 

22 amended— 

23 (1) in subsection (a)(1), by adding at the end 

24 the following: ‘‘Each such agreement shall require 

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1 ports, on a quarterly basis, of the price for each cov2 ered drug subject to the agreement that, according 

3 to the manufacturer, represents the maximum price 

4 that covered entities may permissibly be required to 

5 pay for the drug (referred to in this section as the 

6 ‘ceiling price’), and shall require that the manufac7 turer offer each covered entity covered drugs for 

8 purchase at or below the applicable ceiling price if 

9 such drug is made available to any other purchaser 

10 at any price.’’; and 

11 (2) in the first sentence of subsection (a)(5)(E), 

12 as redesignated by section 7101(c), by inserting 

13 ‘‘after audit as described in subparagraph (D) and’’ 

14 after ‘‘finds,’’. 

15 SEC. 7103. GAO STUDY TO MAKE RECOMMENDATIONS ON 

16 IMPROVING THE 340B PROGRAM. 

17 (a) REPORT.—Not later than 18 months after the 

18 date of enactment of this Act, the Comptroller General 

19 of the United States shall submit to Congress a report 

20 that examines whether those individuals served by the cov21 ered entities under the program under section 340B of 

22 the Public Health Service Act (42 U.S.C. 256b) (referred 

23 to in this section as the ‘‘340B program’’) are receiving 

24 optimal health care services. 


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1 (b) RECOMMENDATIONS.—The report under sub2 section (a) shall include recommendations on the fol3 lowing: 

4 (1) Whether the 340B program should be ex5 panded since it is anticipated that the 47,000,000 

6 individuals who are uninsured as of the date of en7 actment of this Act will have health care coverage 

8 once this Act is implemented. 

9 (2) Whether mandatory sales of certain prod10 ucts by the 340B program could hinder patients ac11 cess to those therapies through any provider. 

12 (3) Whether income from the 340B program is 

13 being used by the covered entities under the pro14 gram to further the program objectives. 

15 TITLE VIII—CLASS ACT 

16 SEC. 8001. SHORT TITLE OF TITLE. 

17 This title may be cited as the ‘‘Community Living 

18 Assistance Services and Supports Act’’ or the ‘‘CLASS 

19 Act’’. 

20 SEC. 8002. ESTABLISHMENT OF NATIONAL VOLUNTARY IN21 SURANCE PROGRAM FOR PURCHASING COM22 MUNITY LIVING ASSISTANCE SERVICES AND 

23 SUPPORT. 

24 (a) ESTABLISHMENT OF CLASS PROGRAM.— 


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1 (1) IN GENERAL.—The Public Health Service 

2 Act (42 U.S.C. 201 et seq.), as amended by section 

3 4302(a), is amended by adding at the end the fol4 lowing: 

5 ‘‘TITLE XXXII—COMMUNITY LIV6 ING ASSISTANCE SERVICES 

7 AND SUPPORTS 

8 ‘‘SEC. 3201. PURPOSE. 

9 ‘‘The purpose of this title is to establish a national 

10 voluntary insurance program for purchasing community 

11 living assistance services and supports in order to— 

12 ‘‘(1) provide individuals with functional limita13 tions with tools that will allow them to maintain 

14 their personal and financial independence and live in 

15 the community through a new financing strategy for 

16 community living assistance services and supports; 

17 ‘‘(2) establish an infrastructure that will help 

18 address the Nation’s community living assistance 

19 services and supports needs; 

20 ‘‘(3) alleviate burdens on family caregivers; and 

21 ‘‘(4) address institutional bias by providing a fi22 nancing mechanism that supports personal choice 

23 and independence to live in the community. 

24 ‘‘SEC. 3202. DEFINITIONS. 

25 ‘‘In this title: 


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1 ‘‘(1) ACTIVE ENROLLEE.—The term ‘active en2 rollee’ means an individual who is enrolled in the 

3 CLASS program in accordance with section 3204 

4 and who has paid any premiums due to maintain 

5 such enrollment. 

6 ‘‘(2) ACTIVELY EMPLOYED.—The term ‘actively 

7 employed’ means an individual who— 

8 ‘‘(A) is reporting for work at the individ9 ual’s usual place of employment or at another 

10 location to which the individual is required to 

11 travel because of the individual’s employment 

12 (or in the case of an individual who is a mem13 ber of the uniformed services, is on active duty 

14 and is physically able to perform the duties of 

15 the individual’s position); and 

16 ‘‘(B) is able to perform all the usual and 

17 customary duties of the individual’s employment 

18 on the individual’s regular work schedule. 

19 ‘‘(3) ACTIVITIES OF DAILY LIVING.—The term 

20 ‘activities of daily living’ means each of the following 

21 activities specified in section 7702B(c)(2)(B) of the 

22 Internal Revenue Code of 1986: 

23 ‘‘(A) Eating. 

24 ‘‘(B) Toileting. 

25 ‘‘(C) Transferring. 


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1 ‘‘(D) Bathing. 

2 ‘‘(E) Dressing. 

3 ‘‘(F) Continence. 

4 ‘‘(4) CLASS PROGRAM.—The term ‘CLASS 

5 program’ means the program established under this 

6 title. 

7 ‘‘(5) ELIGIBILITY ASSESSMENT SYSTEM.—The 

8 term ‘Eligibility Assessment System’ means the enti9 ty established by the Secretary under section 

10 3205(a)(2) to make functional eligibility determina11 tions for the CLASS program. 

12 ‘‘(6) ELIGIBLE BENEFICIARY.— 

13 ‘‘(A) IN GENERAL.—The term ‘eligible 

14 beneficiary’ means any individual who is an ac15 tive enrollee in the CLASS program and, as of 

16 the date described in subparagraph (B)— 

17 ‘‘(i) has paid premiums for enrollment 

18 in such program for at least 60 months; 

19 ‘‘(ii) has earned, with respect to at 

20 least 3 calendar years that occur during 

21 the first 60 months for which the indi22 vidual has paid premiums for enrollment in 

23 the program, at least an amount equal to 

24 the amount of wages and self-employment 

25 income which an individual must have in 


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1 order to be credited with a quarter of cov2 erage under section 213(d) of the Social 

3 Security Act for the year; and 

4 ‘‘(iii) has paid premiums for enroll5 ment in such program for at least 24 con6 secutive months, if a lapse in premium 

7 payments of more than 3 months has oc8 curred during the period that begins on the 

9 date of the individual’s enrollment and 

10 ends on the date of such determination. 

11 ‘‘(B) DATE DESCRIBED.—For purposes of 

12 subparagraph (A), the date described in this 

13 subparagraph is the date on which the indi14 vidual is determined to have a functional limita15 tion described in section 3203(a)(1)(C) that is 

16 expected to last for a continuous period of more 

17 than 90 days. 

18 ‘‘(C) REGULATIONS.—The Secretary shall 

19 promulgate regulations specifying exceptions to 

20 the minimum earnings requirements under sub21 paragraph (A)(ii) for purposes of being consid22 ered an eligible beneficiary for certain popu23 lations. 

24 ‘‘(7) HOSPITAL; NURSING FACILITY; INTER25 MEDIATE CARE FACILITY FOR THE MENTALLY REVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01929 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 TARDED; INSTITUTION FOR MENTAL DISEASES.— 

2 The terms ‘hospital’, ‘nursing facility’, ‘intermediate 

3 care facility for the mentally retarded’, and ‘institu4 tion for mental diseases’ have the meanings given 

5 such terms for purposes of Medicaid. 

6 ‘‘(8) CLASS INDEPENDENCE ADVISORY COUN7 CIL.—The term ‘CLASS Independence Advisory 

8 Council’ or ‘Council’ means the Advisory Council es9 tablished under section 3207 to advise the Secretary. 

10 ‘‘(9) CLASS INDEPENDENCE BENEFIT PLAN.— 

11 The term ‘CLASS Independence Benefit Plan’ 

12 means the benefit plan developed and designated by 

13 the Secretary in accordance with section 3203. 

14 ‘‘(10) CLASS INDEPENDENCE FUND.—The 

15 term ‘CLASS Independence Fund’ or ‘Fund’ means 

16 the fund established under section 3206. 

17 ‘‘(11) MEDICAID.—The term ‘Medicaid’ means 

18 the program established under title XIX of the So19 cial Security Act (42 U.S.C. 1396 et seq.). 

20 ‘‘(12) POVERTY LINE.—The term ‘poverty line’ 

21 has the meaning given that term in section 

22 2110(c)(5) of the Social Security Act (42 U.S.C. 

23 1397jj(c)(5)). 

24 ‘‘(13) PROTECTION AND ADVOCACY SYSTEM.— 

25 The term ‘Protection and Advocacy System’ means 


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1 the system for each State established under section 

2 143 of the Developmental Disabilities Assistance 

3 and Bill of Rights Act of 2000 (42 U.S.C. 15043). 

4 ‘‘SEC. 3203. CLASS INDEPENDENCE BENEFIT PLAN. 

5 ‘‘(a) PROCESS FOR DEVELOPMENT.— 

6 ‘‘(1) IN GENERAL.—The Secretary, in consulta7 tion with appropriate actuaries and other experts, 

8 shall develop at least 3 actuarially sound benefit 

9 plans as alternatives for consideration for designa10 tion by the Secretary as the CLASS Independence 

11 Benefit Plan under which eligible beneficiaries shall 

12 receive benefits under this title. Each of the plan al13 ternatives developed shall be designed to provide eli14 gible beneficiaries with the benefits described in sec15 tion 3205 consistent with the following require16 ments: 

17 ‘‘(A) PREMIUMS.— 

18 ‘‘(i) IN GENERAL.—Beginning with 

19 the first year of the CLASS program, and 

20 for each year thereafter, subject to clauses 

21 (ii) and (iii), the Secretary shall establish 

22 all premiums to be paid by enrollees for 

23 the year based on an actuarial analysis of 

24 the 75-year costs of the program that enVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01931 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 sures solvency throughout such 75-year pe2 riod. 

3 ‘‘(ii) NOMINAL PREMIUM FOR POOR4 EST INDIVIDUALS AND FULL-TIME STU5 DENTS.— 

6 ‘‘(I) IN GENERAL.—The monthly 

7 premium for enrollment in the 

8 CLASS program shall not exceed the 

9 applicable dollar amount per month 

10 determined under subclause (II) for— 

11 ‘‘(aa) any individual whose 

12 income does not exceed the pov13 erty line; and 

14 ‘‘(bb) any individual who 

15 has not attained age 22, and is 

16 actively employed during any pe17 riod in which the individual is a 

18 full-time student (as determined 

19 by the Secretary). 

20 ‘‘(II) APPLICABLE DOLLAR

21 AMOUNT.—The applicable dollar 

22 amount described in this subclause is 

23 the amount equal to $5, increased by 

24 the percentage increase in the con25 sumer price index for all urban conVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01932 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 sumers (U.S. city average) for each 

2 year occurring after 2009 and before 

3 such year. 

4 ‘‘(iii) CLASS INDEPENDENCE FUND

5 RESERVES.—At such time as the CLASS 

6 program has been in operation for 10 

7 years, the Secretary shall establish all pre8 miums to be paid by enrollees for the year 

9 based on an actuarial analysis that accu10 mulated reserves in the CLASS Independ11 ence Fund would not decrease in that year. 

12 At such time as the Secretary determines 

13 the CLASS program demonstrates a sus14 tained ability to finance expected yearly ex15 penses with expected yearly premiums and 

16 interest credited to the CLASS Independ17 ence Fund, the Secretary may decrease the 

18 required amount of CLASS Independence 

19 Fund reserves. 

20 ‘‘(B) VESTING PERIOD.—A 5-year vesting 

21 period for eligibility for benefits. 

22 ‘‘(C) BENEFIT TRIGGERS.—A benefit trig23 ger for provision of benefits that requires a de24 termination that an individual has a functional 

25 limitation, as certified by a licensed health care 


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1 practitioner, described in any of the following 

2 clauses that is expected to last for a continuous 

3 period of more than 90 days: 

4 ‘‘(i) The individual is determined to 

5 be unable to perform at least the minimum 

6 number (which may be 2 or 3) of activities 

7 of daily living as are required under the 

8 plan for the provision of benefits without 

9 substantial assistance (as defined by the 

10 Secretary) from another individual. 

11 ‘‘(ii) The individual requires substan12 tial supervision to protect the individual 

13 from threats to health and safety due to 

14 substantial cognitive impairment. 

15 ‘‘(iii) The individual has a level of 

16 functional limitation similar (as determined 

17 under regulations prescribed by the Sec18 retary) to the level of functional limitation 

19 described in clause (i) or (ii). 

20 ‘‘(D) CASH BENEFIT.—Payment of a cash 

21 benefit that satisfies the following requirements: 

22 ‘‘(i) MINIMUM REQUIRED AMOUNT.— 

23 The benefit amount provides an eligible 

24 beneficiary with not less than an average 

25 of $50 per day (as determined based on 


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1 the reasonably expected distribution of 

2 beneficiaries receiving benefits at various 

3 benefit levels). 

4 ‘‘(ii) AMOUNT SCALED TO FUNC5 TIONAL ABILITY.—The benefit amount is 

6 varied based on a scale of functional abil7 ity, with not less than 2, and not more 

8 than 6, benefit level amounts. 

9 ‘‘(iii) DAILY OR WEEKLY.—The ben10 efit is paid on a daily or weekly basis. 

11 ‘‘(iv) NO LIFETIME OR AGGREGATE

12 LIMIT.—The benefit is not subject to any 

13 lifetime or aggregate limit. 

14 ‘‘(E) COORDINATION WITH SUPPLE15 MENTAL COVERAGE OBTAINED THROUGH THE

16 EXCHANGE.—The benefits allow for coordina17 tion with any supplemental coverage purchased 

18 through an Exchange established under section 

19 1311 of the Patient Protection and Affordable 

20 Care Act. 

21 ‘‘(2) REVIEW AND RECOMMENDATION BY THE

22 CLASS INDEPENDENCE ADVISORY COUNCIL.—The 

23 CLASS Independence Advisory Council shall— 

24 ‘‘(A) evaluate the alternative benefit plans 

25 developed under paragraph (1); and 


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•AMDT. NO. 2786 

1 ‘‘(B) recommend for designation as the 

2 CLASS Independence Benefit Plan for offering 

3 to the public the plan that the Council deter4 mines best balances price and benefits to meet 

5 enrollees’ needs in an actuarially sound manner, 

6 while optimizing the probability of the long7 term sustainability of the CLASS program. 

8 ‘‘(3) DESIGNATION BY THE SECRETARY.—Not 

9 later than October 1, 2012, the Secretary, taking 

10 into consideration the recommendation of the 

11 CLASS Independence Advisory Council under para12 graph (2)(B), shall designate a benefit plan as the 

13 CLASS Independence Benefit Plan. The Secretary 

14 shall publish such designation, along with details of 

15 the plan and the reasons for the selection by the 

16 Secretary, in a final rule that allows for a period of 

17 public comment. 

18 ‘‘(b) ADDITIONAL PREMIUM REQUIREMENTS.— 

19 ‘‘(1) ADJUSTMENT OF PREMIUMS.— 

20 ‘‘(A) IN GENERAL.—Except as provided in 

21 subparagraphs (B), (C), (D), and (E), the 

22 amount of the monthly premium determined for 

23 an individual upon such individual’s enrollment 

24 in the CLASS program shall remain the same 


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1 for as long as the individual is an active en2 rollee in the program. 

3 ‘‘(B) RECALCULATED PREMIUM IF RE4 QUIRED FOR PROGRAM SOLVENCY.— 

5 ‘‘(i) IN GENERAL.—Subject to clause 

6 (ii), if the Secretary determines, based on 

7 the most recent report of the Board of 

8 Trustees of the CLASS Independence 

9 Fund, the advice of the CLASS Independ10 ence Advisory Council, and the annual re11 port of the Inspector General of the De12 partment of Health and Human Services, 

13 and waste, fraud, and abuse, or such other 

14 information as the Secretary determines 

15 appropriate, that the monthly premiums 

16 and income to the CLASS Independence 

17 Fund for a year are projected to be insuffi18 cient with respect to the 20-year period 

19 that begins with that year, the Secretary 

20 shall adjust the monthly premiums for in21 dividuals enrolled in the CLASS program 

22 as necessary (but maintaining a nominal 

23 premium for enrollees whose income is 

24 below the poverty line or who are full-time 

25 students actively employed). 


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1 ‘‘(ii) EXEMPTION FROM INCREASE.— 

2 Any increase in a monthly premium im3 posed as result of a determination de4 scribed in clause (i) shall not apply with 

5 respect to the monthly premium of any ac6 tive enrollee who— 

7 ‘‘(I) has attained age 65; 

8 ‘‘(II) has paid premiums for en9 rollment in the program for at least 

10 20 years; and 

11 ‘‘(III) is not actively employed. 

12 ‘‘(C) RECALCULATED PREMIUM IF RE13 ENROLLMENT AFTER MORE THAN A 3-MONTH

14 LAPSE.— 

15 ‘‘(i) IN GENERAL.—The reenrollment 

16 of an individual after a 90-day period dur17 ing which the individual failed to pay the 

18 monthly premium required to maintain the 

19 individual’s enrollment in the CLASS pro20 gram shall be treated as an initial enroll21 ment for purposes of age-adjusting the 

22 premium for enrollment in the program. 

23 ‘‘(ii) CREDIT FOR PRIOR MONTHS IF

24 REENROLLED WITHIN 5 YEARS.—An indi25 vidual who reenrolls in the CLASS proVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01938 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 gram after such a 90-day period and be2 fore the end of the 5-year period that be3 gins with the first month for which the in4 dividual failed to pay the monthly premium 

5 required to maintain the individual’s en6 rollment in the program shall be— 

7 ‘‘(I) credited with any months of 

8 paid premiums that accrued prior to 

9 the individual’s lapse in enrollment; 

10 and 

11 ‘‘(II) notwithstanding the total 

12 amount of any such credited months, 

13 required to satisfy section 

14 3202(6)(A)(ii) before being eligible to 

15 receive benefits. 

16 ‘‘(D) NO LONGER STATUS AS A FULL-TIME

17 STUDENT.—An individual subject to a nominal 

18 premium on the basis of being described in sub19 section (a)(1)(A)(ii)(I)(bb) who ceases to be de20 scribed in that subsection, beginning with the 

21 first month following the month in which the 

22 individual ceases to be so described, shall be 

23 subject to the same monthly premium as the 

24 monthly premium that applies to an individual 

25 of the same age who first enrolls in the proVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01939 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 gram under the most similar circumstances as 

2 the individual (such as the first year of eligi3 bility for enrollment in the program or in a sub4 sequent year). 

5 ‘‘(E) PENALTY FOR REENOLLMENT AFTER

6 5-YEAR LAPSE.—In the case of an individual 

7 who reenrolls in the CLASS program after the 

8 end of the 5-year period described in subpara9 graph (C)(ii), the monthly premium required 

10 for the individual shall be the age-adjusted pre11 mium that would be applicable to an initially 

12 enrolling individual who is the same age as the 

13 reenrolling individual, increased by the greater 

14 of— 

15 ‘‘(i) an amount that the Secretary de16 termines is actuarially sound for each 

17 month that occurs during the period that 

18 begins with the first month for which the 

19 individual failed to pay the monthly pre20 mium required to maintain the individual’s 

21 enrollment in the CLASS program and 

22 ends with the month preceding the month 

23 in which the reenollment is effective; or 


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1 ‘‘(ii) 1 percent of the applicable age2 adjusted premium for each such month oc3 curring in such period. 

4 ‘‘(2) ADMINISTRATIVE EXPENSES.—In deter5 mining the monthly premiums for the CLASS pro6 gram the Secretary may factor in costs for admin7 istering the program, not to exceed for any year in 

8 which the program is in effect under this title, an 

9 amount equal to 3 percent of all premiums paid dur10 ing the year. 

11 ‘‘(3) NO UNDERWRITING REQUIREMENTS.—No 

12 underwriting (other than on the basis of age in ac13 cordance with subparagraphs (D) and (E) of para14 graph (1)) shall be used to— 

15 ‘‘(A) determine the monthly premium for 

16 enrollment in the CLASS program; or 

17 ‘‘(B) prevent an individual from enrolling 

18 in the program. 

19 ‘‘(c) SELF-ATTESTATION AND VERIFICATION OF IN20 COME.—The Secretary shall establish procedures to— 

21 ‘‘(1) permit an individual who is eligible for the 

22 nominal premium required under subsection 

23 (a)(1)(A)(ii), as part of their automatic enrollment 

24 in the CLASS program, to self-attest that their in25 come does not exceed the poverty line or that their 


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•AMDT. NO. 2786 

1 status as a full-time student who is actively em2 ployed; 

3 ‘‘(2) verify, using procedures similar to the pro4 cedures used by the Commissioner of Social Security 

5 under section 1631(e)(1)(B)(ii) of the Social Secu6 rity Act and consistent with the requirements appli7 cable to the conveyance of data and information 

8 under section 1942 of such Act, the validity of such 

9 self-attestation; and 

10 ‘‘(3) require an individual to confirm, on at 

11 least an annual basis, that their income does not ex12 ceed the poverty line or that they continue to main13 tain such status. 

14 ‘‘SEC. 3204. ENROLLMENT AND DISENROLLMENT REQUIRE15 MENTS. 

16 ‘‘(a) AUTOMATIC ENROLLMENT.— 

17 ‘‘(1) IN GENERAL.—Subject to paragraph (2), 

18 the Secretary, in coordination with the Secretary of 

19 the Treasury, shall establish procedures under which 

20 each individual described in subsection (c) may be 

21 automatically enrolled in the CLASS program by an 

22 employer of such individual in the same manner as 

23 an employer may elect to automatically enroll em24 ployees in a plan under section 401(k), 403(b), or 

25 457 of the Internal Revenue Code of 1986. 


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1 ‘‘(2) ALTERNATIVE ENROLLMENT PROCE2 DURES.—The procedures established under para3 graph (1) shall provide for an alternative enrollment 

4 process for an individual described in subsection (c) 

5 in the case of such an individual— 

6 ‘‘(A) who is self-employed; 

7 ‘‘(B) who has more than 1 employer; or 

8 ‘‘(C) whose employer does not elect to par9 ticipate in the automatic enrollment process es10 tablished by the Secretary. 

11 ‘‘(3) ADMINISTRATION.— 

12 ‘‘(A) IN GENERAL.—The Secretary and the 

13 Secretary of the Treasury shall, by regulation, 

14 establish procedures to ensure that an indi15 vidual is not automatically enrolled in the 

16 CLASS program by more than 1 employer. 

17 ‘‘(B) FORM.—Enrollment in the CLASS 

18 program shall be made in such manner as the 

19 Secretary may prescribe in order to ensure ease 

20 of administration. 

21 ‘‘(b) ELECTION TO OPT-OUT.—An individual de22 scribed in subsection (c) may elect to waive enrollment in 

23 the CLASS program at any time in such form and manner 

24 as the Secretary and the Secretary of the Treasury shall 

25 prescribe. 


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1 ‘‘(c) INDIVIDUAL DESCRIBED.—For purposes of en2 rolling in the CLASS program, an individual described in 

3 this paragraph is an individual— 

4 ‘‘(1) who has attained age 18; 

5 ‘‘(2) who— 

6 ‘‘(A) receives wages on which there is im7 posed a tax under section 3201(a) of the Inter8 nal Revenue Code of 1986; or 

9 ‘‘(B) derives self-employment income on 

10 which there is imposed a tax under section 

11 1401(a) of the Internal Revenue Code of 1986; 

12 ‘‘(3) who is actively employed; and 

13 ‘‘(4) who is not— 

14 ‘‘(A) a patient in a hospital or nursing fa15 cility, an intermediate care facility for the men16 tally retarded, or an institution for mental dis17 eases and receiving medical assistance under 

18 Medicaid; or 

19 ‘‘(B) confined in a jail, prison, other penal 

20 institution or correctional facility, or by court 

21 order pursuant to conviction of a criminal of22 fense or in connection with a verdict or finding 

23 described in section 202(x)(1)(A)(ii) of the So24 cial Security Act (42 U.S.C. 402(x)(1)(A)(ii)). 


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1 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this title 

2 shall be construed as requiring an active enrollee to con3 tinue to satisfy subparagraph (B) or (C) of subsection 

4 (c)(1) in order to maintain enrollment in the CLASS pro5 gram. 

6 ‘‘(e) PAYMENT.— 

7 ‘‘(1) PAYROLL DEDUCTION.—An amount equal 

8 to the monthly premium for the enrollment in the 

9 CLASS program of an individual shall be deducted 

10 from the wages or self-employment income of such 

11 individual in accordance with such procedures as the 

12 Secretary, in coordination with the Secretary of the 

13 Treasury, shall establish for employers who elect to 

14 deduct and withhold such premiums on behalf of en15 rolled employees. 

16 ‘‘(2) ALTERNATIVE PAYMENT MECHANISM.— 

17 The Secretary, in coordination with the Secretary of 

18 the Treasury, shall establish alternative procedures 

19 for the payment of monthly premiums by an indi20 vidual enrolled in the CLASS program— 

21 ‘‘(A) who does not have an employer who 

22 elects to deduct and withhold premiums in ac23 cordance with subparagraph (A); or 

24 ‘‘(B) who does not earn wages or derive 

25 self-employment income. 


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1 ‘‘(f) TRANSFER OF PREMIUMS COLLECTED.— 

2 ‘‘(1) IN GENERAL.—During each calendar year 

3 the Secretary of the Treasury shall deposit into the 

4 CLASS Independence Fund a total amount equal, in 

5 the aggregate, to 100 percent of the premiums col6 lected during that year. 

7 ‘‘(2) TRANSFERS BASED ON ESTIMATES.—The 

8 amount deposited pursuant to paragraph (1) shall be 

9 transferred in at least monthly payments to the 

10 CLASS Independence Fund on the basis of esti11 mates by the Secretary and certified to the Sec12 retary of the Treasury of the amounts collected in 

13 accordance with subparagraphs (A) and (B) of para14 graph (5). Proper adjustments shall be made in 

15 amounts subsequently transferred to the Fund to 

16 the extent prior estimates were in excess of, or were 

17 less than, actual amounts collected. 

18 ‘‘(g) OTHER ENROLLMENT AND DISENROLLMENT

19 OPPORTUNITIES.—The Secretary, in coordination with 

20 the Secretary of the Treasury, shall establish procedures 

21 under which— 

22 ‘‘(1) an individual who, in the year of the indi23 vidual’s initial eligibility to enroll in the CLASS pro24 gram, has elected to waive enrollment in the pro25 gram, is eligible to elect to enroll in the program, in 


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1 such form and manner as the Secretaries shall es2 tablish, only during an open enrollment period estab3 lished by the Secretaries that is specific to the indi4 vidual and that may not occur more frequently than 

5 biennially after the date on which the individual first 

6 elected to waive enrollment in the program; and 

7 ‘‘(2) an individual shall only be permitted to 

8 disenroll from the program (other than for non9 payment of premiums) during an annual 

10 disenrollment period established by the Secretaries 

11 and in such form and manner as the Secretaries 

12 shall establish. 

13 ‘‘SEC. 3205. BENEFITS. 

14 ‘‘(a) DETERMINATION OF ELIGIBILITY.— 

15 ‘‘(1) APPLICATION FOR RECEIPT OF BENE16 FITS.—The Secretary shall establish procedures 

17 under which an active enrollee shall apply for receipt 

18 of benefits under the CLASS Independence Benefit 

19 Plan. 

20 ‘‘(2) ELIGIBILITY ASSESSMENTS.— 

21 ‘‘(A) IN GENERAL.—Not later than Janu22 ary 1, 2012, the Secretary shall— 

23 ‘‘(i) establish an Eligibility Assess24 ment System (other than a service with 

25 which the Commissioner of Social Security 


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1 has entered into an agreement, with re2 spect to any State, to make disability de3 terminations for purposes of title II or 

4 XVI of the Social Security Act) to provide 

5 for eligibility assessments of active enroll6 ees who apply for receipt of benefits; 

7 ‘‘(ii) enter into an agreement with the 

8 Protection and Advocacy System for each 

9 State to provide advocacy services in ac10 cordance with subsection (d); and 

11 ‘‘(iii) enter into an agreement with 

12 public and private entities to provide ad13 vice and assistance counseling in accord14 ance with subsection (e). 

15 ‘‘(B) REGULATIONS.—The Secretary shall 

16 promulgate regulations to develop an expedited 

17 nationally equitable eligibility determination 

18 process, as certified by a licensed health care 

19 practitioner, an appeals process, and a redeter20 mination process, as certified by a licensed 

21 health care practitioner, including whether an 

22 active enrollee is eligible for a cash benefit 

23 under the program and if so, the amount of the 

24 cash benefit (in accordance the sliding scale es25 tablished under the plan). 


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1 ‘‘(C) PRESUMPTIVE ELIGIBILITY FOR CER2 TAIN INSTITUTIONALIZED ENROLLEES PLAN3 NING TO DISCHARGE.—An active enrollee shall 

4 be deemed presumptively eligible if the en5 rollee— 

6 ‘‘(i) has applied for, and attests is eli7 gible for, the maximum cash benefit avail8 able under the sliding scale established 

9 under the CLASS Independence Benefit 

10 Plan; 

11 ‘‘(ii) is a patient in a hospital (but 

12 only if the hospitalization is for long-term 

13 care), nursing facility, intermediate care 

14 facility for the mentally retarded, or an in15 stitution for mental diseases; and 

16 ‘‘(iii) is in the process of, or about to 

17 begin the process of, planning to discharge 

18 from the hospital, facility, or institution, or 

19 within 60 days from the date of discharge 

20 from the hospital, facility, or institution. 

21 ‘‘(D) APPEALS.—The Secretary shall es22 tablish procedures under which an applicant for 

23 benefits under the CLASS Independence Ben24 efit Plan shall be guaranteed the right to ap25 peal an adverse determination. 


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•AMDT. NO. 2786 

1 ‘‘(b) BENEFITS.—An eligible beneficiary shall receive 

2 the following benefits under the CLASS Independence 

3 Benefit Plan: 

4 ‘‘(1) CASH BENEFIT.—A cash benefit estab5 lished by the Secretary in accordance with the re6 quirements of section 3203(a)(1)(D) that— 

7 ‘‘(A) the first year in which beneficiaries 

8 receive the benefits under the plan, is not less 

9 than the average dollar amount specified in 

10 clause (i) of such section; and 

11 ‘‘(B) for any subsequent year, is not less 

12 than the average per day dollar limit applicable 

13 under this subparagraph for the preceding year, 

14 increased by the percentage increase in the con15 sumer price index for all urban consumers 

16 (U.S. city average) over the previous year. 

17 ‘‘(2) ADVOCACY SERVICES.—Advocacy services 

18 in accordance with subsection (d). 

19 ‘‘(3) ADVICE AND ASSISTANCE COUNSELING.— 

20 Advice and assistance counseling in accordance with 

21 subsection (e). 

22 ‘‘(4) ADMINISTRATIVE EXPENSES.—Advocacy 

23 services and advise and assistance counseling serv24 ices under paragraphs (2) and (3) of this subsection 


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1951 

•AMDT. NO. 2786 

1 shall be included as administrative expenses under 

2 section 3203(b)(3). 

3 ‘‘(c) PAYMENT OF BENEFITS.— 

4 ‘‘(1) LIFE INDEPENDENCE ACCOUNT.— 

5 ‘‘(A) IN GENERAL.—The Secretary shall 

6 establish procedures for administering the pro7 vision of benefits to eligible beneficiaries under 

8 the CLASS Independence Benefit Plan, includ9 ing the payment of the cash benefit for the ben10 eficiary into a Life Independence Account es11 tablished by the Secretary on behalf of each eli12 gible beneficiary. 

13 ‘‘(B) USE OF CASH BENEFITS.—Cash ben14 efits paid into a Life Independence Account of 

15 an eligible beneficiary shall be used to purchase 

16 nonmedical services and supports that the bene17 ficiary needs to maintain his or her independ18 ence at home or in another residential setting 

19 of their choice in the community, including (but 

20 not limited to) home modifications, assistive 

21 technology, accessible transportation, home22 maker services, respite care, personal assistance 

23 services, home care aides, and nursing support. 

24 Nothing in the preceding sentence shall prevent 

25 an eligible beneficiary from using cash benefits 


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1952 

•AMDT. NO. 2786 

1 paid into a Life Independence Account for ob2 taining assistance with decision making con3 cerning medical care, including the right to ac4 cept or refuse medical or surgical treatment 

5 and the right to formulate advance directives or 

6 other written instructions recognized under 

7 State law, such as a living will or durable power 

8 of attorney for health care, in the case that an 

9 injury or illness causes the individual to be un10 able to make health care decisions. 

11 ‘‘(C) ELECTRONIC MANAGEMENT OF

12 FUNDS.—The Secretary shall establish proce13 dures for— 

14 ‘‘(i) crediting an account established 

15 on behalf of a beneficiary with the bene16 ficiary’s cash daily benefit; 

17 ‘‘(ii) allowing the beneficiary to access 

18 such account through debit cards; and 

19 ‘‘(iii) accounting for withdrawals by 

20 the beneficiary from such account. 

21 ‘‘(D) PRIMARY PAYOR RULES FOR BENE22 FICIARIES WHO ARE ENROLLED IN MEDICAID.— 

23 In the case of an eligible beneficiary who is en24 rolled in Medicaid, the following payment rules 

25 shall apply: 


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1 ‘‘(i) INSTITUTIONALIZED BENE2 FICIARY.—If the beneficiary is a patient in 

3 a hospital, nursing facility, intermediate 

4 care facility for the mentally retarded, or 

5 an institution for mental diseases, the ben6 eficiary shall retain an amount equal to 5 

7 percent of the beneficiary’s daily or weekly 

8 cash benefit (as applicable) (which shall be 

9 in addition to the amount of the bene10 ficiary’s personal needs allowance provided 

11 under Medicaid), and the remainder of 

12 such benefit shall be applied toward the fa13 cility’s cost of providing the beneficiary’s 

14 care, and Medicaid shall provide secondary 

15 coverage for such care. 

16 ‘‘(ii) BENEFICIARIES RECEIVING

17 HOME AND COMMUNITY-BASED SERV18 ICES.— 

19 ‘‘(I) 50 PERCENT OF BENEFIT

20 RETAINED BY BENEFICIARY.—Subject 

21 to subclause (II), if a beneficiary is 

22 receiving medical assistance under 

23 Medicaid for home and community 

24 based services, the beneficiary shall 

25 retain an amount equal to 50 percent 


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1954 

•AMDT. NO. 2786 

1 of the beneficiary’s daily or weekly 

2 cash benefit (as applicable), and the 

3 remainder of the daily or weekly cash 

4 benefit shall be applied toward the 

5 cost to the State of providing such as6 sistance (and shall not be used to 

7 claim Federal matching funds under 

8 Medicaid), and Medicaid shall provide 

9 secondary coverage for the remainder 

10 of any costs incurred in providing 

11 such assistance. 

12 ‘‘(II) REQUIREMENT FOR STATE

13 OFFSET.—A State shall be paid the 

14 remainder of a beneficiary’s daily or 

15 weekly cash benefit under subclause 

16 (I) only if the State home and com17 munity-based waiver under section 

18 1115 of the Social Security Act (42 

19 U.S.C. 1315) or subsection (c) or (d) 

20 of section 1915 of such Act (42 

21 U.S.C. 1396n), or the State plan 

22 amendment under subsection (i) of 

23 such section does not include a waiver 

24 of the requirements of section 

25 1902(a)(1) of the Social Security Act 


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1955 

•AMDT. NO. 2786 

1 (relating to statewideness) or of sec2 tion 1902(a)(10)(B) of such Act (re3 lating to comparability) and the State 

4 offers at a minimum case manage5 ment services, personal care services, 

6 habilitation services, and respite care 

7 under such a waiver or State plan 

8 amendment. 

9 ‘‘(III) DEFINITION OF HOME AND

10 COMMUNITY-BASED SERVICES.—In 

11 this clause, the term ‘home and com12 munity-based services’ means any 

13 services which may be offered under a 

14 home and community-based waiver 

15 authorized for a State under section 

16 1115 of the Social Security Act (42 

17 U.S.C. 1315) or subsection (c) or (d) 

18 of section 1915 of such Act (42 

19 U.S.C. 1396n) or under a State plan 

20 amendment under subsection (i) of 

21 such section. 

22 ‘‘(iii) BENEFICIARIES ENROLLED IN

23 PROGRAMS OF ALL-INCLUSIVE CARE FOR

24 THE ELDERLY (PACE).— 


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1956 

•AMDT. NO. 2786 

1 ‘‘(I) IN GENERAL.—Subject to 

2 subclause (II), if a beneficiary is re3 ceiving medical assistance under Med4 icaid for PACE program services 

5 under section 1934 of the Social Secu6 rity Act (42 U.S.C. 1396u–4), the 

7 beneficiary shall retain an amount 

8 equal to 50 percent of the bene9 ficiary’s daily or weekly cash benefit 

10 (as applicable), and the remainder of 

11 the daily or weekly cash benefit shall 

12 be applied toward the cost to the 

13 State of providing such assistance 

14 (and shall not be used to claim Fed15 eral matching funds under Medicaid), 

16 and Medicaid shall provide secondary 

17 coverage for the remainder of any 

18 costs incurred in providing such as19 sistance. 

20 ‘‘(II) INSTITUTIONALIZED RE21 CIPIENTS OF PACE PROGRAM SERV22 ICES.—If a beneficiary receiving as23 sistance under Medicaid for PACE 

24 program services is a patient in a hos25 pital, nursing facility, intermediate 


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1957 

•AMDT. NO. 2786 

1 care facility for the mentally retarded, 

2 or an institution for mental diseases, 

3 the beneficiary shall be treated as in 

4 institutionalized beneficiary under 

5 clause (i). 

6 ‘‘(2) AUTHORIZED REPRESENTATIVES.— 

7 ‘‘(A) IN GENERAL.—The Secretary shall 

8 establish procedures to allow access to a bene9 ficiary’s cash benefits by an authorized rep10 resentative of the eligible beneficiary on whose 

11 behalf such benefits are paid. 

12 ‘‘(B) QUALITY ASSURANCE AND PROTEC13 TION AGAINST FRAUD AND ABUSE.—The proce14 dures established under subparagraph (A) shall 

15 ensure that authorized representatives of eligi16 ble beneficiaries comply with standards of con17 duct established by the Secretary, including 

18 standards requiring that such representatives 

19 provide quality services on behalf of such bene20 ficiaries, do not have conflicts of interest, and 

21 do not misuse benefits paid on behalf of such 

22 beneficiaries or otherwise engage in fraud or 

23 abuse. 

24 ‘‘(3) COMMENCEMENT OF BENEFITS.—Benefits 

25 shall be paid to, or on behalf of, an eligible beneVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01957 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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•AMDT. NO. 2786 

1 ficiary beginning with the first month in which an 

2 application for such benefits is approved. 

3 ‘‘(4) ROLLOVER OPTION FOR LUMP-SUM PAY4 MENT.—An eligible beneficiary may elect to— 

5 ‘‘(A) defer payment of their daily or weekly 

6 benefit and to rollover any such deferred bene7 fits from month-to-month, but not from year-to8 year; and 

9 ‘‘(B) receive a lump-sum payment of such 

10 deferred benefits in an amount that may not 

11 exceed the lesser of— 

12 ‘‘(i) the total amount of the accrued 

13 deferred benefits; or 

14 ‘‘(ii) the applicable annual benefit. 

15 ‘‘(5) PERIOD FOR DETERMINATION OF ANNUAL

16 BENEFITS.— 

17 ‘‘(A) IN GENERAL.—The applicable period 

18 for determining with respect to an eligible bene19 ficiary the applicable annual benefit and the 

20 amount of any accrued deferred benefits is the 

21 12-month period that commences with the first 

22 month in which the beneficiary began to receive 

23 such benefits, and each 12-month period there24 after. 


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1 ‘‘(B) INCLUSION OF INCREASED BENE2 FITS.—The Secretary shall establish procedures 

3 under which cash benefits paid to an eligible 

4 beneficiary that increase or decrease as a result 

5 of a change in the functional status of the bene6 ficiary before the end of a 12-month benefit pe7 riod shall be included in the determination of 

8 the applicable annual benefit paid to the eligible 

9 beneficiary. 

10 ‘‘(C) RECOUPMENT OF UNPAID, ACCRUED

11 BENEFITS.— 

12 ‘‘(i) IN GENERAL.—The Secretary, in 

13 coordination with the Secretary of the 

14 Treasury, shall recoup any accrued bene15 fits in the event of— 

16 ‘‘(I) the death of a beneficiary; or 

17 ‘‘(II) the failure of a beneficiary 

18 to elect under paragraph (4)(B) to re19 ceive such benefits as a lump-sum 

20 payment before the end of the 12- 

21 month period in which such benefits 

22 accrued. 

23 ‘‘(ii) PAYMENT INTO CLASS INDE24 PENDENCE FUND.—Any benefits recouped 

25 in accordance with clause (i) shall be paid 


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1960 

•AMDT. NO. 2786 

1 into the CLASS Independence Fund and 

2 used in accordance with section 3206. 

3 ‘‘(6) REQUIREMENT TO RECERTIFY ELIGIBILITY

4 FOR RECEIPT OF BENEFITS.—An eligible beneficiary 

5 shall periodically, as determined by the Secretary— 

6 ‘‘(A) recertify by submission of medical 

7 evidence the beneficiary’s continued eligibility 

8 for receipt of benefits; and 

9 ‘‘(B) submit records of expenditures attrib10 utable to the aggregate cash benefit received by 

11 the beneficiary during the preceding year. 

12 ‘‘(7) SUPPLEMENT, NOT SUPPLANT OTHER

13 HEALTH CARE BENEFITS.—Subject to the Medicaid 

14 payment rules under paragraph (1)(D), benefits re15 ceived by an eligible beneficiary shall supplement, 

16 but not supplant, other health care benefits for 

17 which the beneficiary is eligible under Medicaid or 

18 any other Federally funded program that provides 

19 health care benefits or assistance. 

20 ‘‘(d) ADVOCACY SERVICES.—An agreement entered 

21 into under subsection (a)(2)(A)(ii) shall require the Pro22 tection and Advocacy System for the State to— 

23 ‘‘(1) assign, as needed, an advocacy counselor 

24 to each eligible beneficiary that is covered by such 


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1961 

•AMDT. NO. 2786 

1 agreement and who shall provide an eligible bene2 ficiary with— 

3 ‘‘(A) information regarding how to access 

4 the appeals process established for the program; 

5 ‘‘(B) assistance with respect to the annual 

6 recertification and notification required under 

7 subsection (c)(6); and 

8 ‘‘(C) such other assistance with obtaining 

9 services as the Secretary, by regulation, shall 

10 require; and 

11 ‘‘(2) ensure that the System and such coun12 selors comply with the requirements of subsection 

13 (h). 

14 ‘‘(e) ADVICE AND ASSISTANCE COUNSELING.—An 

15 agreement entered into under subsection (a)(2)(A)(iii) 

16 shall require the entity to assign, as requested by an eligi17 ble beneficiary that is covered by such agreement, an ad18 vice and assistance counselor who shall provide an eligible 

19 beneficiary with information regarding— 

20 ‘‘(1) accessing and coordinating long-term serv21 ices and supports in the most integrated setting; 

22 ‘‘(2) possible eligibility for other benefits and 

23 services; 

24 ‘‘(3) development of a service and support plan; 


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1962 

•AMDT. NO. 2786 

1 ‘‘(4) information about programs established 

2 under the Assistive Technology Act of 1998 and the 

3 services offered under such programs; 

4 ‘‘(5) available assistance with decision making 

5 concerning medical care, including the right to ac6 cept or refuse medical or surgical treatment and the 

7 right to formulate advance directives or other writ8 ten instructions recognized under State law, such as 

9 a living will or durable power of attorney for health 

10 care, in the case that an injury or illness causes the 

11 individual to be unable to make health care deci12 sions; and 

13 ‘‘(6) such other services as the Secretary, by 

14 regulation, may require. 

15 ‘‘(f) NO EFFECT ON ELIGIBILITY FOR OTHER BENE16 FITS.—Benefits paid to an eligible beneficiary under the 

17 CLASS program shall be disregarded for purposes of de18 termining or continuing the beneficiary’s eligibility for re19 ceipt of benefits under any other Federal, State, or locally 

20 funded assistance program, including benefits paid under 

21 titles II, XVI, XVIII, XIX, or XXI of the Social Security 

22 Act (42 U.S.C. 401 et seq., 1381 et seq., 1395 et seq., 

23 1396 et seq., 1397aa et seq.), under the laws administered 

24 by the Secretary of Veterans Affairs, under low-income 

25 housing assistance programs, or under the supplemental 


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1963 

•AMDT. NO. 2786 

1 nutrition assistance program established under the Food 

2 and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.). 

3 ‘‘(g) RULE OF CONSTRUCTION.—Nothing in this title 

4 shall be construed as prohibiting benefits paid under the 

5 CLASS Independence Benefit Plan from being used to 

6 compensate a family caregiver for providing community 

7 living assistance services and supports to an eligible bene8 ficiary. 

9 ‘‘(h) PROTECTION AGAINST CONFLICT OF INTER10 ESTS.—The Secretary shall establish procedures to ensure 

11 that the Eligibility Assessment System, the Protection and 

12 Advocacy System for a State, advocacy counselors for eli13 gible beneficiaries, and any other entities that provide 

14 services to active enrollees and eligible beneficiaries under 

15 the CLASS program comply with the following: 

16 ‘‘(1) If the entity provides counseling or plan17 ning services, such services are provided in a manner 

18 that fosters the best interests of the active enrollee 

19 or beneficiary. 

20 ‘‘(2) The entity has established operating proce21 dures that are designed to avoid or minimize con22 flicts of interest between the entity and an active en23 rollee or beneficiary. 

24 ‘‘(3) The entity provides information about all 

25 services and options available to the active enrollee 


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1964 

•AMDT. NO. 2786 

1 or beneficiary, to the best of its knowledge, including 

2 services available through other entities or providers. 

3 ‘‘(4) The entity assists the active enrollee or 

4 beneficiary to access desired services, regardless of 

5 the provider. 

6 ‘‘(5) The entity reports the number of active 

7 enrollees and beneficiaries provided with assistance 

8 by age, disability, and whether such enrollees and 

9 beneficiaries received services from the entity or an10 other entity. 

11 ‘‘(6) If the entity provides counseling or plan12 ning services, the entity ensures that an active en13 rollee or beneficiary is informed of any financial in14 terest that the entity has in a service provider. 

15 ‘‘(7) The entity provides an active enrollee or 

16 beneficiary with a list of available service providers 

17 that can meet the needs of the active enrollee or 

18 beneficiary. 

19 ‘‘SEC. 3206. CLASS INDEPENDENCE FUND. 

20 ‘‘(a) ESTABLISHMENT OF CLASS INDEPENDENCE

21 FUND.—There is established in the Treasury of the 

22 United States a trust fund to be known as the ‘CLASS 

23 Independence Fund’. The Secretary of the Treasury shall 

24 serve as Managing Trustee of such Fund. The Fund shall 

25 consist of all amounts derived from payments into the 


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1965 

•AMDT. NO. 2786 

1 Fund under sections 3204(f) and 3205(c)(5)(C)(ii), and 

2 remaining after investment of such amounts under sub3 section (b), including additional amounts derived as in4 come from such investments. The amounts held in the 

5 Fund are appropriated and shall remain available without 

6 fiscal year limitation— 

7 ‘‘(1) to be held for investment on behalf of indi8 viduals enrolled in the CLASS program; 

9 ‘‘(2) to pay the administrative expenses related 

10 to the Fund and to investment under subsection (b); 

11 and 

12 ‘‘(3) to pay cash benefits to eligible bene13 ficiaries under the CLASS Independence Benefit 

14 Plan. 

15 ‘‘(b) INVESTMENT OF FUND BALANCE.—The Sec16 retary of the Treasury shall invest and manage the 

17 CLASS Independence Fund in the same manner, and to 

18 the same extent, as the Federal Supplementary Medical 

19 Insurance Trust Fund may be invested and managed 

20 under subsections (c), (d), and (e) of section 1841(d) of 

21 the Social Security Act (42 U.S.C. 1395t). 

22 ‘‘(c) BOARD OF TRUSTEES.— 

23 ‘‘(1) IN GENERAL.—With respect to the CLASS 

24 Independence Fund, there is hereby created a body 

25 to be known as the Board of Trustees of the CLASS 


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1966 

•AMDT. NO. 2786 

1 Independence Fund (hereinafter in this section re2 ferred to as the ‘Board of Trustees’) composed of 

3 the Secretary of the Treasury, the Secretary of 

4 Labor, and the Secretary of Health and Human 

5 Services, all ex officio, and of two members of the 

6 public (both of whom may not be from the same po7 litical party), who shall be nominated by the Presi8 dent for a term of 4 years and subject to confirma9 tion by the Senate. A member of the Board of 

10 Trustees serving as a member of the public and 

11 nominated and confirmed to fill a vacancy occurring 

12 during a term shall be nominated and confirmed 

13 only for the remainder of such term. An individual 

14 nominated and confirmed as a member of the public 

15 may serve in such position after the expiration of 

16 such member’s term until the earlier of the time at 

17 which the member’s successor takes office or the 

18 time at which a report of the Board is first issued 

19 under paragraph (2) after the expiration of the 

20 member’s term. The Secretary of the Treasury shall 

21 be the Managing Trustee of the Board of Trustees. 

22 The Board of Trustees shall meet not less frequently 

23 than once each calendar year. A person serving on 

24 the Board of Trustees shall not be considered to be 

25 a fiduciary and shall not be personally liable for acVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01966 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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•AMDT. NO. 2786 

1 tions taken in such capacity with respect to the 

2 Trust Fund. 

3 ‘‘(2) DUTIES.— 

4 ‘‘(A) IN GENERAL.—It shall be the duty of 

5 the Board of Trustees to do the following: 

6 ‘‘(i) Hold the CLASS Independence 

7 Fund. 

8 ‘‘(ii) Report to the Congress not later 

9 than the first day of April of each year on 

10 the operation and status of the CLASS 

11 Independence Fund during the preceding 

12 fiscal year and on its expected operation 

13 and status during the current fiscal year 

14 and the next 2 fiscal years. 

15 ‘‘(iii) Report immediately to the Con16 gress whenever the Board is of the opinion 

17 that the amount of the CLASS Independ18 ence Fund is not actuarially sound in re19 gards to the projection under section 

20 3203(b)(1)(B)(i). 

21 ‘‘(iv) Review the general policies fol22 lowed in managing the CLASS Independ23 ence Fund, and recommend changes in 

24 such policies, including necessary changes 

25 in the provisions of law which govern the 


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1968 

•AMDT. NO. 2786 

1 way in which the CLASS Independence 

2 Fund is to be managed. 

3 ‘‘(B) REPORT.—The report provided for in 

4 subparagraph (A)(ii) shall— 

5 ‘‘(i) include— 

6 ‘‘(I) a statement of the assets of, 

7 and the disbursements made from, the 

8 CLASS Independence Fund during 

9 the preceding fiscal year; 

10 ‘‘(II) an estimate of the expected 

11 income to, and disbursements to be 

12 made from, the CLASS Independence 

13 Fund during the current fiscal year 

14 and each of the next 2 fiscal years; 

15 ‘‘(III) a statement of the actu16 arial status of the CLASS Independ17 ence Fund for the current fiscal year, 

18 each of the next 2 fiscal years, and as 

19 projected over the 75-year period be20 ginning with the current fiscal year; 

21 and 

22 ‘‘(IV) an actuarial opinion by the 

23 Chief Actuary of the Centers for 

24 Medicare & Medicaid Services certi25 fying that the techniques and methVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01968 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 odologies used are generally accepted 

2 within the actuarial profession and 

3 that the assumptions and cost esti4 mates used are reasonable; and 

5 ‘‘(ii) be printed as a House document 

6 of the session of the Congress to which the 

7 report is made. 

8 ‘‘(C) RECOMMENDATIONS.—If the Board 

9 of Trustees determines that enrollment trends 

10 and expected future benefit claims on the 

11 CLASS Independence Fund are not actuarially 

12 sound in regards to the projection under section 

13 3203(b)(1)(B)(i) and are unlikely to be resolved 

14 with reasonable premium increases or through 

15 other means, the Board of Trustees shall in16 clude in the report provided for in subpara17 graph (A)(ii) recommendations for such legisla18 tive action as the Board of Trustees determine 

19 to be appropriate, including whether to adjust 

20 monthly premiums or impose a temporary mor21 atorium on new enrollments. 

22 ‘‘SEC. 3207. CLASS INDEPENDENCE ADVISORY COUNCIL. 

23 ‘‘(a) ESTABLISHMENT.—There is hereby created an 

24 Advisory Committee to be known as the ‘CLASS Inde25 pendence Advisory Council’. 


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1970 

•AMDT. NO. 2786 

1 ‘‘(b) MEMBERSHIP.— 

2 ‘‘(1) IN GENERAL.—The CLASS Independence 

3 Advisory Council shall be composed of not more 

4 than 15 individuals, not otherwise in the employ of 

5 the United States— 

6 ‘‘(A) who shall be appointed by the Presi7 dent without regard to the civil service laws and 

8 regulations; and 

9 ‘‘(B) a majority of whom shall be rep10 resentatives of individuals who participate or 

11 are likely to participate in the CLASS program, 

12 and shall include representatives of older and 

13 younger workers, individuals with disabilities, 

14 family caregivers of individuals who require 

15 services and supports to maintain their inde16 pendence at home or in another residential set17 ting of their choice in the community, individ18 uals with expertise in long-term care or dis19 ability insurance, actuarial science, economics, 

20 and other relevant disciplines, as determined by 

21 the Secretary. 

22 ‘‘(2) TERMS.— 

23 ‘‘(A) IN GENERAL.—The members of the 

24 CLASS Independence Advisory Council shall 

25 serve overlapping terms of 3 years (unless apVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01970 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 pointed to fill a vacancy occurring prior to the 

2 expiration of a term, in which case the indi3 vidual shall serve for the remainder of the 

4 term). 

5 ‘‘(B) LIMITATION.—A member shall not be 

6 eligible to serve for more than 2 consecutive 

7 terms. 

8 ‘‘(3) CHAIR.—The President shall, from time to 

9 time, appoint one of the members of the CLASS 

10 Independence Advisory Council to serve as the 

11 Chair. 

12 ‘‘(c) DUTIES.—The CLASS Independence Advisory 

13 Council shall advise the Secretary on matters of general 

14 policy in the administration of the CLASS program estab15 lished under this title and in the formulation of regula16 tions under this title including with respect to— 

17 ‘‘(1) the development of the CLASS Independ18 ence Benefit Plan under section 3203; 

19 ‘‘(2) the determination of monthly premiums 

20 under such plan; and 

21 ‘‘(3) the financial solvency of the program. 

22 ‘‘(d) APPLICATION OF FACA.—The Federal Advisory 

23 Committee Act (5 U.S.C. App.), other than section 14 of 

24 that Act, shall apply to the CLASS Independence Advisory 

25 Council. 


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1 ‘‘(e) AUTHORIZATION OF APPROPRIATIONS.— 

2 ‘‘(1) IN GENERAL.—There are authorized to be 

3 appropriated to the CLASS Independence Advisory 

4 Council to carry out its duties under this section, 

5 such sums as may be necessary for fiscal year 2011 

6 and for each fiscal year thereafter. 

7 ‘‘(2) AVAILABILITY.—Any sums appropriated 

8 under the authorization contained in this section 

9 shall remain available, without fiscal year limitation, 

10 until expended. 

11 ‘‘SEC. 3208. SOLVENCY AND FISCAL INDEPENDENCE; REGU12 LATIONS; ANNUAL REPORT. 

13 ‘‘(a) SOLVENCY.—The Secretary shall regularly con14 sult with the Board of Trustees of the CLASS Independ15 ence Fund and the CLASS Independence Advisory Coun16 cil, for purposes of ensuring that enrollees premiums are 

17 adequate to ensure the financial solvency of the CLASS 

18 program, both with respect to fiscal years occurring in the 

19 near-term and fiscal years occurring over 20- and 75- year 

20 periods, taking into account the projections required for 

21 such periods under subsections (a)(1)(A)(i) and 

22 (b)(1)(B)(i) of section 3202. 

23 ‘‘(b) NO TAXPAYER FUNDS USED TO PAY BENE24 FITS.—No taxpayer funds shall be used for payment of 

25 benefits under a CLASS Independent Benefit Plan. For 


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•AMDT. NO. 2786 

1 purposes of this subsection, the term ‘taxpayer funds’ 

2 means any Federal funds from a source other than pre3 miums deposited by CLASS program participants in the 

4 CLASS Independence Fund and any associated interest 

5 earnings. 

6 ‘‘(c) REGULATIONS.—The Secretary shall promulgate 

7 such regulations as are necessary to carry out the CLASS 

8 program in accordance with this title. Such regulations 

9 shall include provisions to prevent fraud and abuse under 

10 the program. 

11 ‘‘(d) ANNUAL REPORT.—Beginning January 1, 2014, 

12 the Secretary shall submit an annual report to Congress 

13 on the CLASS program. Each report shall include the fol14 lowing: 

15 ‘‘(1) The total number of enrollees in the pro16 gram. 

17 ‘‘(2) The total number of eligible beneficiaries 

18 during the fiscal year. 

19 ‘‘(3) The total amount of cash benefits provided 

20 during the fiscal year. 

21 ‘‘(4) A description of instances of fraud or 

22 abuse identified during the fiscal year. 

23 ‘‘(5) Recommendations for such administrative 

24 or legislative action as the Secretary determines is 

25 necessary to improve the program, ensure the solVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01973 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 vency of the program, or to prevent the occurrence 

2 of fraud or abuse. 

3 ‘‘SEC. 3209. INSPECTOR GENERAL’S REPORT. 

4 ‘‘The Inspector General of the Department of Health 

5 and Human Services shall submit an annual report to the 

6 Secretary and Congress relating to the overall progress of 

7 the CLASS program and of the existence of waste, fraud, 

8 and abuse in the CLASS program. Each such report shall 

9 include findings in the following areas: 

10 ‘‘(1) The eligibility determination process. 

11 ‘‘(2) The provision of cash benefits. 

12 ‘‘(3) Quality assurance and protection against 

13 waste, fraud, and abuse. 

14 ‘‘(4) Recouping of unpaid and accrued benefits. 

15 ‘‘SEC. 3210. TAX TREATMENT OF PROGRAM. 

16 ‘‘The CLASS program shall be treated for purposes 

17 of the Internal Revenue Code of 1986 in the same manner 

18 as a qualified long-term care insurance contract for quali19 fied long-term care services.’’. 

20 (2) CONFORMING AMENDMENTS TO MED21 ICAID.—Section 1902(a) of the Social Security Act 

22 (42 U.S.C. 1396a(a)), as amended by section 6505, 

23 is amended by inserting after paragraph (80) the 

24 following: 


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1 ‘‘(81) provide that the State will comply with 

2 such regulations regarding the application of pri3 mary and secondary payor rules with respect to indi4 viduals who are eligible for medical assistance under 

5 this title and are eligible beneficiaries under the 

6 CLASS program established under title XXXII of 

7 the Public Health Service Act as the Secretary shall 

8 establish; and’’. 

9 (b) ASSURANCE OF ADEQUATE INFRASTRUCTURE

10 FOR THE PROVISION OF PERSONAL CARE ATTENDANT

11 WORKERS.—Section 1902(a) of the Social Security Act 

12 (42 U.S.C. 1396a(a)), as amended by subsection (a)(2), 

13 is amended by inserting after paragraph (81) the fol14 lowing: 

15 ‘‘(82) provide that, not later than 2 years after 

16 the date of enactment of the Community Living As17 sistance Services and Supports Act, each State 

18 shall— 

19 ‘‘(A) assess the extent to which entities 

20 such as providers of home care, home health 

21 services, home and community service providers, 

22 public authorities created to provide personal 

23 care services to individuals eligible for medical 

24 assistance under the State plan, and nonprofit 

25 organizations, are serving or have the capacity 


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1 to serve as fiscal agents for, employers of, and 

2 providers of employment-related benefits for, 

3 personal care attendant workers who provide 

4 personal care services to individuals receiving 

5 benefits under the CLASS program established 

6 under title XXXII of the Public Health Service 

7 Act, including in rural and underserved areas; 

8 ‘‘(B) designate or create such entities to 

9 serve as fiscal agents for, employers of, and 

10 providers of employment-related benefits for, 

11 such workers to ensure an adequate supply of 

12 the workers for individuals receiving benefits 

13 under the CLASS program, including in rural 

14 and underserved areas; and 

15 ‘‘(C) ensure that the designation or cre16 ation of such entities will not negatively alter or 

17 impede existing programs, models, methods, or 

18 administration of service delivery that provide 

19 for consumer controlled or self-directed home 

20 and community services and further ensure that 

21 such entities will not impede the ability of indi22 viduals to direct and control their home and 

23 community services, including the ability to se24 lect, manage, dismiss, co-employ, or employ 

25 such workers or inhibit such individuals from 


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1 relying on family members for the provision of 

2 personal care services.’’. 

3 (c) PERSONAL CARE ATTENDANTS WORKFORCE AD4 VISORY PANEL.— 

5 (1) ESTABLISHMENT.—Not later than 90 days 

6 after the date of enactment of this Act, the Sec7 retary of Health and Human Services shall establish 

8 a Personal Care Attendants Workforce Advisory 

9 Panel for the purpose of examining and advising the 

10 Secretary and Congress on workforce issues related 

11 to personal care attendant workers, including with 

12 respect to the adequacy of the number of such work13 ers, the salaries, wages, and benefits of such work14 ers, and access to the services provided by such 

15 workers. 

16 (2) MEMBERSHIP.—In appointing members to 

17 the Personal Care Attendants Workforce Advisory 

18 Panel, the Secretary shall ensure that such members 

19 include the following: 

20 (A) Individuals with disabilities of all ages. 

21 (B) Senior individuals. 

22 (C) Representatives of individuals with dis23 abilities. 

24 (D) Representatives of senior individuals. 


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1 (E) Representatives of workforce and labor 

2 organizations. 

3 (F) Representatives of home and commu4 nity-based service providers. 

5 (G) Representatives of assisted living pro6 viders. 

7 (d) INCLUSION OF INFORMATION ON SUPPLEMENTAL

8 COVERAGE IN THE NATIONAL CLEARINGHOUSE FOR

9 LONG-TERM CARE INFORMATION; EXTENSION OF FUND10 ING.—Section 6021(d) of the Deficit Reduction Act of 

11 2005 (42 U.S.C. 1396p note) is amended— 

12 (1) in paragraph (2)(A)— 

13 (A) in clause (ii), by striking ‘‘and’’ at the 

14 end; 

15 (B) in clause (iii), by striking the period at 

16 the end and inserting ‘‘; and’’; and 

17 (C) by adding at the end the following: 

18 ‘‘(iv) include information regarding 

19 the CLASS program established under 

20 title XXXII of the Public Health Service 

21 Act and coverage available for purchase 

22 through a Exchange established under sec23 tion 1311 of the Patient Protection and 

24 Affordable Care Act that is supplemental 

25 coverage to the benefits provided under a 


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1979 

•AMDT. NO. 2786 

1 CLASS Independence Benefit Plan under 

2 that program, and information regarding 

3 how benefits provided under a CLASS 

4 Independence Benefit Plan differ from dis5 ability insurance benefits.’’; and 

6 (2) in paragraph (3), by striking ‘‘2010’’ and 

7 inserting ‘‘2015’’. 

8 (e) EFFECTIVE DATE.—The amendments made by 

9 subsections (a), (b), and (d) take effect on January 1, 

10 2011. 

11 (f) RULE OF CONSTRUCTION.—Nothing in this title 

12 or the amendments made by this title are intended to re13 place or displace public or private disability insurance ben14 efits, including such benefits that are for income replace15 ment. 

16 TITLE IX—REVENUE 

17 PROVISIONS 

18 Subtitle A—Revenue Offset 

19 Provisions 

20 SEC. 9001. EXCISE TAX ON HIGH COST EMPLOYER-SPON21 SORED HEALTH COVERAGE. 

22 (a) IN GENERAL.—Chapter 43 of the Internal Rev23 enue Code of 1986, as amended by section 1513, is 

24 amended by adding at the end the following: 


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1 ‘‘SEC. 4980I. EXCISE TAX ON HIGH COST EMPLOYER-SPON2 SORED HEALTH COVERAGE. 

3 ‘‘(a) IMPOSITION OF TAX.—If— 

4 ‘‘(1) an employee is covered under any applica5 ble employer-sponsored coverage of an employer at 

6 any time during a taxable period, and 

7 ‘‘(2) there is any excess benefit with respect to 

8 the coverage, 

9 there is hereby imposed a tax equal to 40 percent of the 

10 excess benefit. 

11 ‘‘(b) EXCESS BENEFIT.—For purposes of this sec12 tion— 

13 ‘‘(1) IN GENERAL.—The term ‘excess benefit’ 

14 means, with respect to any applicable employer-spon15 sored coverage made available by an employer to an 

16 employee during any taxable period, the sum of the 

17 excess amounts determined under paragraph (2) for 

18 months during the taxable period. 

19 ‘‘(2) MONTHLY EXCESS AMOUNT.—The excess 

20 amount determined under this paragraph for any 

21 month is the excess (if any) of— 

22 ‘‘(A) the aggregate cost of the applicable 

23 employer-sponsored coverage of the employee 

24 for the month, over 


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‘‘(B) an amount equal to 1 1 ⁄12 of the annual 

2 limitation under paragraph (3) for the calendar 

3 year in which the month occurs. 

4 ‘‘(3) ANNUAL LIMITATION.—For purposes of 

5 this subsection— 

6 ‘‘(A) IN GENERAL.—The annual limitation 

7 under this paragraph for any calendar year is 

8 the dollar limit determined under subparagraph 

9 (C) for the calendar year. 

10 ‘‘(B) APPLICABLE ANNUAL LIMITATION.— 

11 The annual limitation which applies for any 

12 month shall be determined on the basis of the 

13 type of coverage (as determined under sub14 section (f)(1)) provided to the employee by the 

15 employer as of the beginning of the month. 

16 ‘‘(C) APPLICABLE DOLLAR LIMIT.—Except 

17 as provided in subparagraph (D)— 

18 ‘‘(i) 2013.—In the case of 2013, the 

19 dollar limit under this subparagraph is— 

20 ‘‘(I) in the case of an employee 

21 with self-only coverage, $8,500, and 

22 ‘‘(II) in the case of an employee 

23 with coverage other than self-only cov24 erage, $23,000. 


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1 ‘‘(ii) EXCEPTION FOR CERTAIN INDI2 VIDUALS.—In the case of an individual 

3 who is a qualified retiree or who partici4 pates in a plan sponsored by an employer 

5 the majority of whose employees are en6 gaged in a high-risk profession or em7 ployed to repair or install electrical or tele8 communications lines— 

9 ‘‘(I) the dollar amount in clause 

10 (i)(I) (determined after the applica11 tion of subparagraph (D)) shall be in12 creased by $1,350, and 

13 ‘‘(II) the dollar amount in clause 

14 (i)(II) (determined after the applica15 tion of subparagraph (D)) shall be in16 creased by $3,000. 

17 ‘‘(iii) SUBSEQUENT YEARS.—In the 

18 case of any calendar year after 2013, each 

19 of the dollar amounts under clauses (i) and 

20 (ii) shall be increased to the amount equal 

21 to such amount as in effect for the cal22 endar year preceding such year, increased 

23 by an amount equal to the product of— 

24 ‘‘(I) such amount as so in effect, 

25 multiplied by 


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1 ‘‘(II) the cost-of-living adjust2 ment determined under section 1(f)(3) 

3 for such year (determined by sub4 stituting the calendar year that is 2 

5 years before such year for ‘1992’ in 

6 subparagraph (B) thereof), increased 

7 by 1 percentage point. 

8 If any amount determined under this 

9 clause is not a multiple of $50, such 

10 amount shall be rounded to the nearest 

11 multiple of $50. 

12 ‘‘(D) TRANSITION RULE FOR STATES WITH

13 HIGHEST COVERAGE COSTS.— 

14 ‘‘(i) IN GENERAL.—If an employee is 

15 a resident of a high cost State on the first 

16 day of any month beginning in 2013, 

17 2014, or 2015, the annual limitation under 

18 this paragraph for such month with re19 spect to such employee shall be an amount 

20 equal to the applicable percentage of the 

21 annual limitation (determined without re22 gard to this subparagraph or subparagraph 

23 (C)(ii)). 

24 ‘‘(ii) APPLICABLE PERCENTAGE.—The 

25 applicable percentage is 120 percent for 


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1 2013, 110 percent for 2014, and 105 per2 cent for 2015. 

3 ‘‘(iii) HIGH COST STATE.—The term 

4 ‘high cost State’ means each of the 17 

5 States which the Secretary of Health and 

6 Human Services, in consultation with the 

7 Secretary, estimates had the highest aver8 age cost during 2012 for employer-spon9 sored coverage under health plans. The 

10 Secretary’s estimate shall be made on the 

11 basis of aggregate premiums paid in the 

12 State for such health plans, determined 

13 using the most recent data available as of 

14 August 31, 2012. 

15 ‘‘(c) LIABILITY TO PAY TAX.— 

16 ‘‘(1) IN GENERAL.—Each coverage provider 

17 shall pay the tax imposed by subsection (a) on its 

18 applicable share of the excess benefit with respect to 

19 an employee for any taxable period. 

20 ‘‘(2) COVERAGE PROVIDER.—For purposes of 

21 this subsection, the term ‘coverage provider’ means 

22 each of the following: 

23 ‘‘(A) HEALTH INSURANCE COVERAGE.—If 

24 the applicable employer-sponsored coverage con25 sists of coverage under a group health plan 


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1985 

•AMDT. NO. 2786 

1 which provides health insurance coverage, the 

2 health insurance issuer. 

3 ‘‘(B) HSA AND MSA CONTRIBUTIONS.—If 

4 the applicable employer-sponsored coverage con5 sists of coverage under an arrangement under 

6 which the employer makes contributions de7 scribed in subsection (b) or (d) of section 106, 

8 the employer. 

9 ‘‘(C) OTHER COVERAGE.—In the case of 

10 any other applicable employer-sponsored cov11 erage, the person that administers the plan ben12 efits. 

13 ‘‘(3) APPLICABLE SHARE.—For purposes of 

14 this subsection, a coverage provider’s applicable 

15 share of an excess benefit for any taxable period is 

16 the amount which bears the same ratio to the 

17 amount of such excess benefit as— 

18 ‘‘(A) the cost of the applicable employer19 sponsored coverage provided by the provider to 

20 the employee during such period, bears to 

21 ‘‘(B) the aggregate cost of all applicable 

22 employer-sponsored coverage provided to the 

23 employee by all coverage providers during such 

24 period. 


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1 ‘‘(4) RESPONSIBILITY TO CALCULATE TAX AND

2 APPLICABLE SHARES.— 

3 ‘‘(A) IN GENERAL.—Each employer shall— 

4 ‘‘(i) calculate for each taxable period 

5 the amount of the excess benefit subject to 

6 the tax imposed by subsection (a) and the 

7 applicable share of such excess benefit for 

8 each coverage provider, and 

9 ‘‘(ii) notify, at such time and in such 

10 manner as the Secretary may prescribe, 

11 the Secretary and each coverage provider 

12 of the amount so determined for the pro13 vider. 

14 ‘‘(B) SPECIAL RULE FOR MULTIEMPLOYER

15 PLANS.—In the case of applicable employer16 sponsored coverage made available to employees 

17 through a multiemployer plan (as defined in 

18 section 414(f)), the plan sponsor shall make the 

19 calculations, and provide the notice, required 

20 under subparagraph (A). 

21 ‘‘(d) APPLICABLE EMPLOYER-SPONSORED COV22 ERAGE; COST.—For purposes of this section— 

23 ‘‘(1) APPLICABLE EMPLOYER-SPONSORED COV24 ERAGE.— 


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1 ‘‘(A) IN GENERAL.—The term ‘applicable 

2 employer-sponsored coverage’ means, with re3 spect to any employee, coverage under any 

4 group health plan made available to the em5 ployee by an employer which is excludable from 

6 the employee’s gross income under section 106, 

7 or would be so excludable if it were employer8 provided coverage (within the meaning of such 

9 section 106). 

10 ‘‘(B) EXCEPTIONS.—The term ‘applicable 

11 employer-sponsored coverage’ shall not in12 clude— 

13 ‘‘(i) any coverage (whether through 

14 insurance or otherwise) described in sec15 tion 9832(c)(1)(A) or for long-term care, 

16 or 

17 ‘‘(ii) any coverage described in section 

18 9832(c)(3) the payment for which is not 

19 excludable from gross income and for 

20 which a deduction under section 162(l) is 

21 not allowable. 

22 ‘‘(C) COVERAGE INCLUDES EMPLOYEE

23 PAID PORTION.—Coverage shall be treated as 

24 applicable employer-sponsored coverage without 


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1988 

•AMDT. NO. 2786 

1 regard to whether the employer or employee 

2 pays for the coverage. 

3 ‘‘(D) SELF-EMPLOYED INDIVIDUAL.—In 

4 the case of an individual who is an employee 

5 within the meaning of section 401(c)(1), cov6 erage under any group health plan providing 

7 health insurance coverage shall be treated as 

8 applicable employer-sponsored coverage if a de9 duction is allowable under section 162(l) with 

10 respect to all or any portion of the cost of the 

11 coverage. 

12 ‘‘(E) GOVERNMENTAL PLANS INCLUDED.— 

13 Applicable employer-sponsored coverage shall 

14 include coverage under any group health plan 

15 established and maintained primarily for its ci16 vilian employees by the Government of the 

17 United States, by the government of any State 

18 or political subdivision thereof, or by any agen19 cy or instrumentality of any such government. 

20 ‘‘(2) DETERMINATION OF COST.— 

21 ‘‘(A) IN GENERAL.—The cost of applicable 

22 employer-sponsored coverage shall be deter23 mined under rules similar to the rules of section 

24 4980B(f)(4), except that in determining such 

25 cost, any portion of the cost of such coverage 


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1989 

•AMDT. NO. 2786 

1 which is attributable to the tax imposed under 

2 this section shall not be taken into account and 

3 the amount of such cost shall be calculated sep4 arately for self-only coverage and other cov5 erage. In the case of applicable employer-spon6 sored coverage which provides coverage to re7 tired employees, the plan may elect to treat a 

8 retired employee who has not attained the age 

9 of 65 and a retired employee who has attained 

10 the age of 65 as similarly situated beneficiaries. 

11 ‘‘(B) HEALTH FSAS.—In the case of appli12 cable employer-sponsored coverage consisting of 

13 coverage under a flexible spending arrangement 

14 (as defined in section 106(c)(2)), the cost of the 

15 coverage shall be equal to the sum of— 

16 ‘‘(i) the amount of employer contribu17 tions under any salary reduction election 

18 under the arrangement, plus 

19 ‘‘(ii) the amount determined under 

20 subparagraph (A) with respect to any re21 imbursement under the arrangement in ex22 cess of the contributions described in 

23 clause (i). 

24 ‘‘(C) ARCHER MSAS AND HSAS.—In the 

25 case of applicable employer-sponsored coverage 


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1990 

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1 consisting of coverage under an arrangement 

2 under which the employer makes contributions 

3 described in subsection (b) or (d) of section 

4 106, the cost of the coverage shall be equal to 

5 the amount of employer contributions under the 

6 arrangement. 

7 ‘‘(D) ALLOCATION ON A MONTHLY

8 BASIS.—If cost is determined on other than a 

9 monthly basis, the cost shall be allocated to 

10 months in a taxable period on such basis as the 

11 Secretary may prescribe. 

12 ‘‘(e) PENALTY FOR FAILURE TO PROPERLY CAL13 CULATE EXCESS BENEFIT.— 

14 ‘‘(1) IN GENERAL.—If, for any taxable period, 

15 the tax imposed by subsection (a) exceeds the tax 

16 determined under such subsection with respect to 

17 the total excess benefit calculated by the employer or 

18 plan sponsor under subsection (c)(4)— 

19 ‘‘(A) each coverage provider shall pay the 

20 tax on its applicable share (determined in the 

21 same manner as under subsection (c)(4)) of the 

22 excess, but no penalty shall be imposed on the 

23 provider with respect to such amount, and 

24 ‘‘(B) the employer or plan sponsor shall, in 

25 addition to any tax imposed by subsection (a), 


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1991 

•AMDT. NO. 2786 

1 pay a penalty in an amount equal to such ex2 cess, plus interest at the underpayment rate de3 termined under section 6621 for the period be4 ginning on the due date for the payment of tax 

5 imposed by subsection (a) to which the excess 

6 relates and ending on the date of payment of 

7 the penalty. 

8 ‘‘(2) LIMITATIONS ON PENALTY.— 

9 ‘‘(A) PENALTY NOT TO APPLY WHERE

10 FAILURE NOT DISCOVERED EXERCISING REA11 SONABLE DILIGENCE.—No penalty shall be im12 posed by paragraph (1)(B) on any failure to 

13 properly calculate the excess benefit during any 

14 period for which it is established to the satisfac15 tion of the Secretary that the employer or plan 

16 sponsor neither knew, nor exercising reasonable 

17 diligence would have known, that such failure 

18 existed. 

19 ‘‘(B) PENALTY NOT TO APPLY TO FAIL20 URES CORRECTED WITHIN 30 DAYS.—No pen21 alty shall be imposed by paragraph (1)(B) on 

22 any such failure if— 

23 ‘‘(i) such failure was due to reason24 able cause and not to willful neglect, and 


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1992 

•AMDT. NO. 2786 

1 ‘‘(ii) such failure is corrected during 

2 the 30-day period beginning on the 1st 

3 date that the employer knew, or exercising 

4 reasonable diligence would have known, 

5 that such failure existed. 

6 ‘‘(C) WAIVER BY SECRETARY.—In the case 

7 of any such failure which is due to reasonable 

8 cause and not to willful neglect, the Secretary 

9 may waive part or all of the penalty imposed by 

10 paragraph (1), to the extent that the payment 

11 of such penalty would be excessive or otherwise 

12 inequitable relative to the failure involved. 

13 ‘‘(f) OTHER DEFINITIONS AND SPECIAL RULES.— 

14 For purposes of this section— 

15 ‘‘(1) COVERAGE DETERMINATIONS.— 

16 ‘‘(A) IN GENERAL.—Except as provided in 

17 subparagraph (B), an employee shall be treated 

18 as having self-only coverage with respect to any 

19 applicable employer-sponsored coverage of an 

20 employer. 

21 ‘‘(B) MINIMUM ESSENTIAL COVERAGE.— 

22 An employee shall be treated as having coverage 

23 other than self-only coverage only if the em24 ployee is enrolled in coverage other than self25 only coverage in a group health plan which proVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 01992 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 vides minimum essential coverage (as defined in 

2 section 5000A(f)) to the employee and at least 

3 one other beneficiary, and the benefits provided 

4 under such minimum essential coverage do not 

5 vary based on whether any individual covered 

6 under such coverage is the employee or another 

7 beneficiary. 

8 ‘‘(2) QUALIFIED RETIREE.—The term ‘qualified 

9 retiree’ means any individual who— 

10 ‘‘(A) is receiving coverage by reason of 

11 being a retiree, 

12 ‘‘(B) has attained age 55, and 

13 ‘‘(C) is not entitled to benefits or eligible 

14 for enrollment under the Medicare program 

15 under title XVIII of the Social Security Act. 

16 ‘‘(3) EMPLOYEES ENGAGED IN HIGH-RISK PRO17 FESSION.—The term ‘employees engaged in a high18 risk profession’ means law enforcement officers (as 

19 such term is defined in section 1204 of the Omnibus 

20 Crime Control and Safe Streets Act of 1968), em21 ployees in fire protection activities (as such term is 

22 defined in section 3(y) of the Fair Labor Standards 

23 Act of 1938), individuals who provide out-of-hospital 

24 emergency medical care (including emergency med25 ical technicians, paramedics, and first-responders), 


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1994 

•AMDT. NO. 2786 

1 and individuals engaged in the construction, mining, 

2 agriculture (not including food processing), forestry, 

3 and fishing industries. Such term includes an em4 ployee who is retired from a high-risk profession de5 scribed in the preceding sentence, if such employee 

6 satisfied the requirements of such sentence for a pe7 riod of not less than 20 years during the employee’s 

8 employment. 

9 ‘‘(4) GROUP HEALTH PLAN.—The term ‘group 

10 health plan’ has the meaning given such term by 

11 section 5000(b)(1). 

12 ‘‘(5) HEALTH INSURANCE COVERAGE; HEALTH

13 INSURANCE ISSUER.— 

14 ‘‘(A) HEALTH INSURANCE COVERAGE.— 

15 The term ‘health insurance coverage’ has the 

16 meaning given such term by section 9832(b)(1) 

17 (applied without regard to subparagraph (B) 

18 thereof, except as provided by the Secretary in 

19 regulations). 

20 ‘‘(B) HEALTH INSURANCE ISSUER.—The 

21 term ‘health insurance issuer’ has the meaning 

22 given such term by section 9832(b)(2). 

23 ‘‘(6) PERSON THAT ADMINISTERS THE PLAN

24 BENEFITS.—The term ‘person that administers the 


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1995 

•AMDT. NO. 2786 

1 plan benefits’ shall include the plan sponsor if the 

2 plan sponsor administers benefits under the plan. 

3 ‘‘(7) PLAN SPONSOR.—The term ‘plan sponsor’ 

4 has the meaning given such term in section 3(16)(B) 

5 of the Employee Retirement Income Security Act of 

6 1974. 

7 ‘‘(8) TAXABLE PERIOD.—The term ‘taxable pe8 riod’ means the calendar year or such shorter period 

9 as the Secretary may prescribe. The Secretary may 

10 have different taxable periods for employers of vary11 ing sizes. 

12 ‘‘(9) AGGREGATION RULES.—All employers 

13 treated as a single employer under subsection (b), 

14 (c), (m), or (o) of section 414 shall be treated as a 

15 single employer. 

16 ‘‘(10) DENIAL OF DEDUCTION.—For denial of a 

17 deduction for the tax imposed by this section, see 

18 section 275(a)(6). 

19 ‘‘(g) REGULATIONS.—The Secretary shall prescribe 

20 such regulations as may be necessary to carry out this 

21 section.’’. 

22 (b) CLERICAL AMENDMENT.—The table of sections 

23 for chapter 43 of such Code, as amended by section 1513, 

24 is amended by adding at the end the following new item: 

‘‘Sec. 4980I. Excise tax on high cost employer-sponsored health coverage.’’. 


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1996 

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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2012. 

4 SEC. 9002. INCLUSION OF COST OF EMPLOYER-SPONSORED 

5 HEALTH COVERAGE ON W–2. 

6 (a) IN GENERAL.—Section 6051(a) of the Internal 

7 Revenue Code of 1986 (relating to receipts for employees) 

8 is amended by striking ‘‘and’’ at the end of paragraph 

9 (12), by striking the period at the end of paragraph (13) 

10 and inserting ‘‘, and’’, and by adding after paragraph (13) 

11 the following new paragraph: 

12 ‘‘(14) the aggregate cost (determined under 

13 rules similar to the rules of section 4980B(f)(4)) of 

14 applicable employer-sponsored coverage (as defined 

15 in section 4980I(d)(1)), except that this paragraph 

16 shall not apply to— 

17 ‘‘(A) coverage to which paragraphs (11) 

18 and (12) apply, or 

19 ‘‘(B) the amount of any salary reduction 

20 contributions to a flexible spending arrange21 ment (within the meaning of section 125).’’. 

22 (b) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years beginning after 

24 December 31, 2010. 


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1 SEC. 9003. DISTRIBUTIONS FOR MEDICINE QUALIFIED 

2 ONLY IF FOR PRESCRIBED DRUG OR INSU3 LIN. 

4 (a) HSAS.—Subparagraph (A) of section 223(d)(2) 

5 of the Internal Revenue Code of 1986 is amended by add6 ing at the end the following: ‘‘Such term shall include an 

7 amount paid for medicine or a drug only if such medicine 

8 or drug is a prescribed drug (determined without regard 

9 to whether such drug is available without a prescription) 

10 or is insulin.’’. 

11 (b) ARCHER MSAS.—Subparagraph (A) of section 

12 220(d)(2) of the Internal Revenue Code of 1986 is amend13 ed by adding at the end the following: ‘‘Such term shall 

14 include an amount paid for medicine or a drug only if such 

15 medicine or drug is a prescribed drug (determined without 

16 regard to whether such drug is available without a pre17 scription) or is insulin.’’. 

18 (c) HEALTH FLEXIBLE SPENDING ARRANGEMENTS

19 AND HEALTH REIMBURSEMENT ARRANGEMENTS.—Sec20 tion 106 of the Internal Revenue Code of 1986 is amended 

21 by adding at the end the following new subsection: 

22 ‘‘(f) REIMBURSEMENTS FOR MEDICINE RESTRICTED

23 TO PRESCRIBED DRUGS AND INSULIN.—For purposes of 

24 this section and section 105, reimbursement for expenses 

25 incurred for a medicine or a drug shall be treated as a 

26 reimbursement for medical expenses only if such medicine 


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1 or drug is a prescribed drug (determined without regard 

2 to whether such drug is available without a prescription) 

3 or is insulin.’’. 

4 (d) EFFECTIVE DATES.— 

5 (1) DISTRIBUTIONS FROM SAVINGS AC6 COUNTS.—The amendments made by subsections (a) 

7 and (b) shall apply to amounts paid with respect to 

8 taxable years beginning after December 31, 2010. 

9 (2) REIMBURSEMENTS.—The amendment made 

10 by subsection (c) shall apply to expenses incurred 

11 with respect to taxable years beginning after Decem12 ber 31, 2010. 

13 SEC. 9004. INCREASE IN ADDITIONAL TAX ON DISTRIBU14 TIONS FROM HSAS AND ARCHER MSAS NOT 

15 USED FOR QUALIFIED MEDICAL EXPENSES. 

16 (a) HSAS.—Section 223(f)(4)(A) of the Internal 

17 Revenue Code of 1986 is amended by striking ‘‘10 per18 cent’’ and inserting ‘‘20 percent’’. 

19 (b) ARCHER MSAS.—Section 220(f)(4)(A) of the In20 ternal Revenue Code of 1986 is amended by striking ‘‘15 

21 percent’’ and inserting ‘‘20 percent’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to distributions made after Decem24 ber 31, 2010. 


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1 SEC. 9005. LIMITATION ON HEALTH FLEXIBLE SPENDING 

2 ARRANGEMENTS UNDER CAFETERIA PLANS. 

3 (a) IN GENERAL.—Section 125 of the Internal Rev4 enue Code of 1986 is amended— 

5 (1) by redesignating subsections (i) and (j) as 

6 subsections (j) and (k), respectively, and 

7 (2) by inserting after subsection (h) the fol8 lowing new subsection: 

9 ‘‘(i) LIMITATION ON HEALTH FLEXIBLE SPENDING

10 ARRANGEMENTS.—For purposes of this section, if a ben11 efit is provided under a cafeteria plan through employer 

12 contributions to a health flexible spending arrangement, 

13 such benefit shall not be treated as a qualified benefit un14 less the cafeteria plan provides that an employee may not 

15 elect for any taxable year to have salary reduction con16 tributions in excess of $2,500 made to such arrange17 ment.’’. 

18 (b) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to taxable years beginning after 

20 December 31, 2010. 

21 SEC. 9006. EXPANSION OF INFORMATION REPORTING RE22 QUIREMENTS. 

23 (a) IN GENERAL.—Section 6041 of the Internal Rev24 enue Code of 1986 is amended by adding at the end the 

25 following new subsections: 


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1 ‘‘(h) APPLICATION TO CORPORATIONS.—Notwith2 standing any regulation prescribed by the Secretary before 

3 the date of the enactment of this subsection, for purposes 

4 of this section the term ‘person’ includes any corporation 

5 that is not an organization exempt from tax under section 

6 501(a). 

7 ‘‘(i) REGULATIONS.—The Secretary may prescribe 

8 such regulations and other guidance as may be appro9 priate or necessary to carry out the purposes of this sec10 tion, including rules to prevent duplicative reporting of 

11 transactions.’’. 

12 (b) PAYMENTS FOR PROPERTY AND OTHER GROSS

13 PROCEEDS.—Subsection (a) of section 6041 of the Inter14 nal Revenue Code of 1986 is amended— 

15 (1) by inserting ‘‘amounts in consideration for 

16 property,’’ after ‘‘wages,’’, 

17 (2) by inserting ‘‘gross proceeds,’’ after ‘‘emolu18 ments, or other’’, and 

19 (3) by inserting ‘‘gross proceeds,’’ after ‘‘setting 

20 forth the amount of such’’. 

21 (c) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply to payments made after December 

23 31, 2011. 


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1 SEC. 9007. ADDITIONAL REQUIREMENTS FOR CHARITABLE 

2 HOSPITALS. 

3 (a) REQUIREMENTS TO QUALIFY AS SECTION

4 501(C)(3) CHARITABLE HOSPITAL ORGANIZATION.—Sec5 tion 501 of the Internal Revenue Code of 1986 (relating 

6 to exemption from tax on corporations, certain trusts, etc.) 

7 is amended by redesignating subsection (r) as subsection 

8 (s) and by inserting after subsection (q) the following new 

9 subsection: 

10 ‘‘(r) ADDITIONAL REQUIREMENTS FOR CERTAIN

11 HOSPITALS.— 

12 ‘‘(1) IN GENERAL.—A hospital organization to 

13 which this subsection applies shall not be treated as 

14 described in subsection (c)(3) unless the organiza15 tion— 

16 ‘‘(A) meets the community health needs 

17 assessment requirements described in para18 graph (3), 

19 ‘‘(B) meets the financial assistance policy 

20 requirements described in paragraph (4), 

21 ‘‘(C) meets the requirements on charges 

22 described in paragraph (5), and 

23 ‘‘(D) meets the billing and collection re24 quirement described in paragraph (6). 

25 ‘‘(2) HOSPITAL ORGANIZATIONS TO WHICH

26 SUBSECTION APPLIES.— 


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1 ‘‘(A) IN GENERAL.—This subsection shall 

2 apply to— 

3 ‘‘(i) an organization which operates a 

4 facility which is required by a State to be 

5 licensed, registered, or similarly recognized 

6 as a hospital, and 

7 ‘‘(ii) any other organization which the 

8 Secretary determines has the provision of 

9 hospital care as its principal function or 

10 purpose constituting the basis for its ex11 emption under subsection (c)(3) (deter12 mined without regard to this subsection). 

13 ‘‘(B) ORGANIZATIONS WITH MORE THAN 1

14 HOSPITAL FACILITY.—If a hospital organization 

15 operates more than 1 hospital facility— 

16 ‘‘(i) the organization shall meet the 

17 requirements of this subsection separately 

18 with respect to each such facility, and 

19 ‘‘(ii) the organization shall not be 

20 treated as described in subsection (c)(3) 

21 with respect to any such facility for which 

22 such requirements are not separately met. 

23 ‘‘(3) COMMUNITY HEALTH NEEDS ASSESS24 MENTS.— 


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1 ‘‘(A) IN GENERAL.—An organization meets 

2 the requirements of this paragraph with respect 

3 to any taxable year only if the organization— 

4 ‘‘(i) has conducted a community 

5 health needs assessment which meets the 

6 requirements of subparagraph (B) in such 

7 taxable year or in either of the 2 taxable 

8 years immediately preceding such taxable 

9 year, and 

10 ‘‘(ii) has adopted an implementation 

11 strategy to meet the community health 

12 needs identified through such assessment. 

13 ‘‘(B) COMMUNITY HEALTH NEEDS ASSESS14 MENT.—A community health needs assessment 

15 meets the requirements of this paragraph if 

16 such community health needs assessment— 

17 ‘‘(i) takes into account input from 

18 persons who represent the broad interests 

19 of the community served by the hospital 

20 facility, including those with special knowl21 edge of or expertise in public health, and 

22 ‘‘(ii) is made widely available to the 

23 public. 


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1 ‘‘(4) FINANCIAL ASSISTANCE POLICY.—An or2 ganization meets the requirements of this paragraph 

3 if the organization establishes the following policies: 

4 ‘‘(A) FINANCIAL ASSISTANCE POLICY.—A 

5 written financial assistance policy which in6 cludes— 

7 ‘‘(i) eligibility criteria for financial as8 sistance, and whether such assistance in9 cludes free or discounted care, 

10 ‘‘(ii) the basis for calculating amounts 

11 charged to patients, 

12 ‘‘(iii) the method for applying for fi13 nancial assistance, 

14 ‘‘(iv) in the case of an organization 

15 which does not have a separate billing and 

16 collections policy, the actions the organiza17 tion may take in the event of non-payment, 

18 including collections action and reporting 

19 to credit agencies, and 

20 ‘‘(v) measures to widely publicize the 

21 policy within the community to be served 

22 by the organization. 

23 ‘‘(B) POLICY RELATING TO EMERGENCY

24 MEDICAL CARE.—A written policy requiring the 

25 organization to provide, without discrimination, 


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1 care for emergency medical conditions (within 

2 the meaning of section 1867 of the Social Secu3 rity Act (42 U.S.C. 1395dd)) to individuals re4 gardless of their eligibility under the financial 

5 assistance policy described in subparagraph (A). 

6 ‘‘(5) LIMITATION ON CHARGES.—An organiza7 tion meets the requirements of this paragraph if the 

8 organization— 

9 ‘‘(A) limits amounts charged for emer10 gency or other medically necessary care pro11 vided to individuals eligible for assistance under 

12 the financial assistance policy described in para13 graph (4)(A) to not more than the lowest 

14 amounts charged to individuals who have insur15 ance covering such care, and 

16 ‘‘(B) prohibits the use of gross charges. 

17 ‘‘(6) BILLING AND COLLECTION REQUIRE18 MENTS.—An organization meets the requirement of 

19 this paragraph only if the organization does not en20 gage in extraordinary collection actions before the 

21 organization has made reasonable efforts to deter22 mine whether the individual is eligible for assistance 

23 under the financial assistance policy described in 

24 paragraph (4)(A). 


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1 ‘‘(7) REGULATORY AUTHORITY.—The Secretary 

2 shall issue such regulations and guidance as may be 

3 necessary to carry out the provisions of this sub4 section, including guidance relating to what con5 stitutes reasonable efforts to determine the eligibility 

6 of a patient under a financial assistance policy for 

7 purposes of paragraph (6).’’. 

8 (b) EXCISE TAX FOR FAILURES TO MEET HOSPITAL

9 EXEMPTION REQUIREMENTS.— 

10 (1) IN GENERAL.—Subchapter D of chapter 42 

11 of the Internal Revenue Code of 1986 (relating to 

12 failure by certain charitable organizations to meet 

13 certain qualification requirements) is amended by 

14 adding at the end the following new section: 

15 ‘‘SEC. 4959. TAXES ON FAILURES BY HOSPITAL ORGANIZA16 TIONS. 

17 ‘‘If a hospital organization to which section 501(r) 

18 applies fails to meet the requirement of section 501(r)(3) 

19 for any taxable year, there is imposed on the organization 

20 a tax equal to $50,000.’’. 

21 (2) CONFORMING AMENDMENT.—The table of 

22 sections for subchapter D of chapter 42 of such 

23 Code is amended by adding at the end the following 

24 new item: 

‘‘Sec. 4959. Taxes on failures by hospital organizations.’’. 


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1 (c) MANDATORY REVIEW OF TAX EXEMPTION FOR

2 HOSPITALS.—The Secretary of the Treasury or the Sec3 retary’s delegate shall review at least once every 3 years 

4 the community benefit activities of each hospital organiza5 tion to which section 501(r) of the Internal Revenue Code 

6 of 1986 (as added by this section) applies. 

7 (d) ADDITIONAL REPORTING REQUIREMENTS.— 

8 (1) COMMUNITY HEALTH NEEDS ASSESSMENTS

9 AND AUDITED FINANCIAL STATEMENTS.—Section 

10 6033(b) of the Internal Revenue Code of 1986 (re11 lating to certain organizations described in section 

12 501(c)(3)) is amended by striking ‘‘and’’ at the end 

13 of paragraph (14), by redesignating paragraph (15) 

14 as paragraph (16), and by inserting after paragraph 

15 (14) the following new paragraph: 

16 ‘‘(15) in the case of an organization to which 

17 the requirements of section 501(r) apply for the tax18 able year— 

19 ‘‘(A) a description of how the organization 

20 is addressing the needs identified in each com21 munity health needs assessment conducted 

22 under section 501(r)(3) and a description of 

23 any such needs that are not being addressed to24 gether with the reasons why such needs are not 

25 being addressed, and 


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1 ‘‘(B) the audited financial statements of 

2 such organization (or, in the case of an organi3 zation the financial statements of which are in4 cluded in a consolidated financial statement 

5 with other organizations, such consolidated fi6 nancial statement).’’. 

7 (2) TAXES.—Section 6033(b)(10) of such Code 

8 is amended by striking ‘‘and’’ at the end of subpara9 graph (B), by inserting ‘‘and’’ at the end of sub10 paragraph (C), and by adding at the end the fol11 lowing new subparagraph: 

12 ‘‘(D) section 4959 (relating to taxes on 

13 failures by hospital organizations),’’. 

14 (e) REPORTS.— 

15 (1) REPORT ON LEVELS OF CHARITY CARE.— 

16 The Secretary of the Treasury, in consultation with 

17 the Secretary of Health and Human Services, shall 

18 submit to the Committees on Ways and Means, 

19 Education and Labor, and Energy and Commerce of 

20 the House of Representatives and to the Committees 

21 on Finance and Health, Education, Labor, and Pen22 sions of the Senate an annual report on the fol23 lowing: 


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1 (A) Information with respect to private 

2 tax-exempt, taxable, and government-owned 

3 hospitals regarding— 

4 (i) levels of charity care provided, 

5 (ii) bad debt expenses, 

6 (iii) unreimbursed costs for services 

7 provided with respect to means-tested gov8 ernment programs, and 

9 (iv) unreimbursed costs for services 

10 provided with respect to non-means tested 

11 government programs. 

12 (B) Information with respect to private 

13 tax-exempt hospitals regarding costs incurred 

14 for community benefit activities. 

15 (2) REPORT ON TRENDS.— 

16 (A) STUDY.—The Secretary of the Treas17 ury, in consultation with the Secretary of 

18 Health and Human Services, shall conduct a 

19 study on trends in the information required to 

20 be reported under paragraph (1). 

21 (B) REPORT.—Not later than 5 years after 

22 the date of the enactment of this Act, the Sec23 retary of the Treasury, in consultation with the 

24 Secretary of Health and Human Services, shall 

25 submit a report on the study conducted under 


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1 subparagraph (A) to the Committees on Ways 

2 and Means, Education and Labor, and Energy 

3 and Commerce of the House of Representatives 

4 and to the Committees on Finance and Health, 

5 Education, Labor, and Pensions of the Senate. 

6 (f) EFFECTIVE DATES.— 

7 (1) IN GENERAL.—Except as provided in para8 graphs (2) and (3), the amendments made by this 

9 section shall apply to taxable years beginning after 

10 the date of the enactment of this Act. 

11 (2) COMMUNITY HEALTH NEEDS ASSESS12 MENT.—The requirements of section 501(r)(3) of 

13 the Internal Revenue Code of 1986, as added by 

14 subsection (a), shall apply to taxable years beginning 

15 after the date which is 2 years after the date of the 

16 enactment of this Act. 

17 (3) EXCISE TAX.—The amendments made by 

18 subsection (b) shall apply to failures occurring after 

19 the date of the enactment of this Act. 

20 SEC. 9008. IMPOSITION OF ANNUAL FEE ON BRANDED PRE21 SCRIPTION PHARMACEUTICAL MANUFAC22 TURERS AND IMPORTERS. 

23 (a) IMPOSITION OF FEE.— 

24 (1) IN GENERAL.—Each covered entity engaged 

25 in the business of manufacturing or importing 


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1 branded prescription drugs shall pay to the Sec2 retary of the Treasury not later than the annual 

3 payment date of each calendar year beginning after 

4 2009 a fee in an amount determined under sub5 section (b). 

6 (2) ANNUAL PAYMENT DATE.—For purposes of 

7 this section, the term ‘‘annual payment date’’ means 

8 with respect to any calendar year the date deter9 mined by the Secretary, but in no event later than 

10 September 30 of such calendar year. 

11 (b) DETERMINATION OF FEE AMOUNT.— 

12 (1) IN GENERAL.—With respect to each covered 

13 entity, the fee under this section for any calendar 

14 year shall be equal to an amount that bears the 

15 same ratio to $2,300,000,000 as— 

16 (A) the covered entity’s branded prescrip17 tion drug sales taken into account during the 

18 preceding calendar year, bear to 

19 (B) the aggregate branded prescription 

20 drug sales of all covered entities taken into ac21 count during such preceding calendar year. 

22 (2) SALES TAKEN INTO ACCOUNT.—For pur23 poses of paragraph (1), the branded prescription 

24 drug sales taken into account during any calendar 


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1 year with respect to any covered entity shall be de2 termined 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. 

3 (3) SECRETARIAL DETERMINATION.—The Sec4 retary of the Treasury shall calculate the amount of 

5 each covered entity’s fee for any calendar year under 

6 paragraph (1). In calculating such amount, the Sec7 retary of the Treasury shall determine such covered 

8 entity’s branded prescription drug sales on the basis 

9 of reports submitted under subsection (g) and 

10 through the use of any other source of information 

11 available to the Secretary of the Treasury. 

12 (c) TRANSFER OF FEES TO MEDICARE PART B 

13 TRUST FUND.—There is hereby appropriated to the Fed14 eral Supplementary Medical Insurance Trust Fund estab15 lished under section 1841 of the Social Security Act an 

16 amount equal to the fees received by the Secretary of the 

17 Treasury under subsection (a). 

18 (d) COVERED ENTITY.— 


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1 (1) IN GENERAL.—For purposes of this section, 

2 the term ‘‘covered entity’’ means any manufacturer 

3 or importer with gross receipts from branded pre4 scription drug sales. 

5 (2) CONTROLLED GROUPS.— 

6 (A) IN GENERAL.—For purposes of this 

7 subsection, all persons treated as a single em8 ployer under subsection (a) or (b) of section 52 

9 of the Internal Revenue Code of 1986 or sub10 section (m) or (o) of section 414 of such Code 

11 shall be treated as a single covered entity. 

12 (B) INCLUSION OF FOREIGN CORPORA13 TIONS.—For purposes of subparagraph (A), in 

14 applying subsections (a) and (b) of section 52 

15 of such Code to this section, section 1563 of 

16 such Code shall be applied without regard to 

17 subsection (b)(2)(C) thereof. 

18 (e) BRANDED PRESCRIPTION DRUG SALES.—For 

19 purposes of this section— 

20 (1) IN GENERAL.—The term ‘‘branded prescrip21 tion drug sales’’ means sales of branded prescription 

22 drugs to any specified government program or pur23 suant to coverage under any such program. 

24 (2) BRANDED PRESCRIPTION DRUGS.— 


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1 (A) IN GENERAL.—The term ‘‘branded 

2 prescription drug’’ means— 

3 (i) any prescription drug the applica4 tion for which was submitted under section 

5 505(b) of the Federal Food, Drug, and 

6 Cosmetic Act (21 U.S.C. 355(b)), or 

7 (ii) any biological product the license 

8 for which was submitted under section 

9 351(a) of the Public Health Service Act 

10 (42 U.S.C. 262(a)). 

11 (B) PRESCRIPTION DRUG.—For purposes 

12 of subparagraph (A)(i), the term ‘‘prescription 

13 drug’’ means any drug which is subject to sec14 tion 503(b) of the Federal Food, Drug, and 

15 Cosmetic Act (21 U.S.C. 353(b)). 

16 (3) EXCLUSION OF ORPHAN DRUG SALES.—The 

17 term ‘‘branded prescription drug sales’’ shall not in18 clude sales of any drug or biological product with re19 spect to which a credit was allowed for any taxable 

20 year under section 45C of the Internal Revenue 

21 Code of 1986. The preceding sentence shall not 

22 apply with respect to any such drug or biological 

23 product after the date on which such drug or bio24 logical product is approved by the Food and Drug 

25 Administration for marketing for any indication 


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1 other than the treatment of the rare disease or con2 dition with respect to which such credit was allowed. 

3 (4) SPECIFIED GOVERNMENT PROGRAM.—The 

4 term ‘‘specified government program’’ means— 

5 (A) the Medicare Part D program under 

6 part D of title XVIII of the Social Security Act, 

7 (B) the Medicare Part B program under 

8 part B of title XVIII of the Social Security Act, 

9 (C) the Medicaid program under title XIX 

10 of the Social Security Act, 

11 (D) any program under which branded 

12 prescription drugs are procured by the Depart13 ment of Veterans Affairs, 

14 (E) any program under which branded pre15 scription drugs are procured by the Department 

16 of Defense, or 

17 (F) the TRICARE retail pharmacy pro18 gram under section 1074g of title 10, United 

19 States Code. 

20 (f) TAX TREATMENT OF FEES.—The fees imposed 

21 by this section— 

22 (1) for purposes of subtitle F of the Internal 

23 Revenue Code of 1986, shall be treated as excise 

24 taxes with respect to which only civil actions for reVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 02015 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 fund under procedures of such subtitle shall apply, 

2 and 

3 (2) for purposes of section 275 of such Code, 

4 shall be considered to be a tax described in section 

5 275(a)(6). 

6 (g) REPORTING REQUIREMENT.—Not later than the 

7 date determined by the Secretary of the Treasury fol8 lowing the end of any calendar year, the Secretary of 

9 Health and Human Services, the Secretary of Veterans 

10 Affairs, and the Secretary of Defense shall report to the 

11 Secretary of the Treasury, in such manner as the Sec12 retary of the Treasury prescribes, the total branded pre13 scription drug sales for each covered entity with respect 

14 to each specified government program under such Sec15 retary’s jurisdiction using the following methodology: 

16 (1) MEDICARE PART D PROGRAM.—The Sec17 retary of Health and Human Services shall report, 

18 for each covered entity and for each branded pre19 scription drug of the covered entity covered by the 

20 Medicare Part D program, the product of— 

21 (A) the per-unit ingredient cost, as re22 ported to the Secretary of Health and Human 

23 Services by prescription drug plans and Medi24 care Advantage prescription drug plans, minus 

25 any per-unit rebate, discount, or other price 


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1 concession provided by the covered entity, as re2 ported to the Secretary of Health and Human 

3 Services by the prescription drug plans and 

4 Medicare Advantage prescription drug plans, 

5 and 

6 (B) the number of units of the branded 

7 prescription drug paid for under the Medicare 

8 Part D program. 

9 (2) MEDICARE PART B PROGRAM.—The Sec10 retary of Health and Human Services shall report, 

11 for each covered entity and for each branded pre12 scription drug of the covered entity covered by the 

13 Medicare Part B program under section 1862(a) of 

14 the Social Security Act, the product of— 

15 (A) the per-unit average sales price (as de16 fined in section 1847A(c) of the Social Security 

17 Act) or the per-unit Part B payment rate for 

18 a separately paid branded prescription drug 

19 without a reported average sales price, and 

20 (B) the number of units of the branded 

21 prescription drug paid for under the Medicare 

22 Part B program. 

23 The Centers for Medicare and Medicaid Services 

24 shall establish a process for determining the units 

25 and the allocated price for purposes of this section 


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1 for those branded prescription drugs that are not 

2 separately payable or for which National Drug 

3 Codes are not reported. 

4 (3) MEDICAID PROGRAM.—The Secretary of 

5 Health and Human Services shall report, for each 

6 covered entity and for each branded prescription 

7 drug of the covered entity covered under the Med8 icaid program, the product of— 

9 (A) the per-unit ingredient cost paid to 

10 pharmacies by States for the branded prescrip11 tion drug dispensed to Medicaid beneficiaries, 

12 minus any per-unit rebate paid by the covered 

13 entity under section 1927 of the Social Security 

14 Act and any State supplemental rebate, and 

15 (B) the number of units of the branded 

16 prescription drug paid for under the Medicaid 

17 program. 

18 (4) DEPARTMENT OF VETERANS AFFAIRS PRO19 GRAMS.—The Secretary of Veterans Affairs shall re20 port, for each covered entity and for each branded 

21 prescription drug of the covered entity the total 

22 amount paid for each such branded prescription 

23 drug procured by the Department of Veterans Af24 fairs for its beneficiaries. 


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1 (5) DEPARTMENT OF DEFENSE PROGRAMS AND

2 TRICARE.—The Secretary of Defense shall report, 

3 for each covered entity and for each branded pre4 scription drug of the covered entity, the sum of— 

5 (A) the total amount paid for each such 

6 branded prescription drug procured by the De7 partment of Defense for its beneficiaries, and 

8 (B) for each such branded prescription 

9 drug dispensed under the TRICARE retail 

10 pharmacy program, the product of— 

11 (i) the per-unit ingredient cost, minus 

12 any per-unit rebate paid by the covered en13 tity, and 

14 (ii) the number of units of the brand15 ed prescription drug dispensed under such 

16 program. 

17 (h) SECRETARY.—For purposes of this section, the 

18 term ‘‘Secretary’’ includes the Secretary’s delegate. 

19 (i) GUIDANCE.—The Secretary of the Treasury shall 

20 publish guidance necessary to carry out the purposes of 

21 this section. 

22 (j) APPLICATION OF SECTION.—This section shall 

23 apply to any branded prescription drug sales after Decem24 ber 31, 2008. 


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1 (k) CONFORMING AMENDMENT.—Section 1841(a) of 

2 the Social Security Act is amended by inserting ‘‘or sec3 tion 9008(c) of the Patient Protection and Affordable 

4 Care Act of 2009’’ after ‘‘this part’’. 

5 SEC. 9009. IMPOSITION OF ANNUAL FEE ON MEDICAL DE6 VICE MANUFACTURERS AND IMPORTERS. 

7 (a) IMPOSITION OF FEE.— 

8 (1) IN GENERAL.—Each covered entity engaged 

9 in the business of manufacturing or importing med10 ical devices shall pay to the Secretary not later than 

11 the annual payment date of each calendar year be12 ginning after 2009 a fee in an amount determined 

13 under subsection (b). 

14 (2) ANNUAL PAYMENT DATE.—For purposes of 

15 this section, the term ‘‘annual payment date’’ means 

16 with respect to any calendar year the date deter17 mined by the Secretary, but in no event later than 

18 September 30 of such calendar year. 

19 (b) DETERMINATION OF FEE AMOUNT.— 

20 (1) IN GENERAL.—With respect to each covered 

21 entity, the fee under this section for any calendar 

22 year shall be equal to an amount that bears the 

23 same ratio to $2,000,000,000 as— 


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1 (A) the covered entity’s gross receipts from 

2 medical device sales taken into account during 

3 the preceding calendar year, bear to 

4 (B) the aggregate gross receipts of all cov5 ered entities from medical device sales taken 

6 into account during such preceding calendar 

7 year. 

8 (2) GROSS RECEIPTS FROM SALES TAKEN INTO

9 ACCOUNT.—For purposes of paragraph (1), the 

10 gross receipts from medical device sales taken into 

11 account during any calendar year with respect to 

12 any covered entity shall be determined in accordance 

13 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. 

14 (3) SECRETARIAL DETERMINATION.—The Sec15 retary shall calculate the amount of each covered en16 tity’s fee for any calendar year under paragraph (1). 

17 In calculating such amount, the Secretary shall de18 termine such covered entity’s gross receipts from 

19 medical device sales on the basis of reports sub20 mitted by the covered entity under subsection (f) 


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1 and through the use of any other source of informa2 tion available to the Secretary. 

3 (c) COVERED ENTITY.— 

4 (1) IN GENERAL.—For purposes of this section, 

5 the term ‘‘covered entity’’ means any manufacturer 

6 or importer with gross receipts from medical device 

7 sales. 

8 (2) CONTROLLED GROUPS.— 

9 (A) IN GENERAL.—For purposes of this 

10 subsection, all persons treated as a single em11 ployer under subsection (a) or (b) of section 52 

12 of the Internal Revenue Code of 1986 or sub13 section (m) or (o) of section 414 of such Code 

14 shall be treated as a single covered entity. 

15 (B) INCLUSION OF FOREIGN CORPORA16 TIONS.—For purposes of subparagraph (A), in 

17 applying subsections (a) and (b) of section 52 

18 of such Code to this section, section 1563 of 

19 such Code shall be applied without regard to 

20 subsection (b)(2)(C) thereof. 

21 (d) MEDICAL DEVICE SALES.—For purposes of this 

22 section— 

23 (1) IN GENERAL.—The term ‘‘medical device 

24 sales’’ means sales for use in the United States of 


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1 any medical device, other than the sales of a medical 

2 device that— 

3 (A) has been classified in class II under 

4 section 513 of the Federal Food, Drug, and 

5 Cosmetic Act (21 U.S.C. 360c) and is primarily 

6 sold to consumers at retail for not more than 

7 $100 per unit, or 

8 (B) has been classified in class I under 

9 such section. 

10 (2) UNITED STATES.—For purposes of para11 graph (1), the term ‘‘United States’’ means the sev12 eral States, the District of Columbia, the Common13 wealth of Puerto Rico, and the possessions of the 

14 United States. 

15 (3) MEDICAL DEVICE.—For purposes of para16 graph (1), the term ‘‘medical device’’ means any de17 vice (as defined in section 201(h) of the Federal 

18 Food, Drug, and Cosmetic Act (21 U.S.C. 321(h))) 

19 intended for humans. 

20 (e) TAX TREATMENT OF FEES.—The fees imposed 

21 by this section— 

22 (1) for purposes of subtitle F of the Internal 

23 Revenue Code of 1986, shall be treated as excise 

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1 fund under procedures of such subtitle shall apply, 

2 and 

3 (2) for purposes of section 275 of such Code, 

4 shall be considered to be a tax described in section 

5 275(a)(6). 

6 (f) REPORTING REQUIREMENT.— 

7 (1) IN GENERAL.—Not later than the date de8 termined by the Secretary following the end of any 

9 calendar year, each covered entity shall report to the 

10 Secretary, in such manner as the Secretary pre11 scribes, the gross receipts from medical device sales 

12 of such covered entity during such calendar year. 

13 (2) PENALTY FOR FAILURE TO REPORT.— 

14 (A) IN GENERAL.—In the case of any fail15 ure to make a report containing the information 

16 required by paragraph (1) on the date pre17 scribed therefor (determined with regard to any 

18 extension of time for filing), unless it is shown 

19 that such failure is due to reasonable cause, 

20 there shall be paid by the covered entity failing 

21 to file such report, an amount equal to— 

22 (i) $10,000, plus 

23 (ii) the lesser of— 


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1 (I) an amount equal to $1,000, 

2 multiplied by the number of days dur3 ing which such failure continues, or 

4 (II) the amount of the fee im5 posed by this section for which such 

6 report was required. 

7 (B) TREATMENT OF PENALTY.—The pen8 alty imposed under subparagraph (A)— 

9 (i) shall be treated as a penalty for 

10 purposes of subtitle F of the Internal Rev11 enue Code of 1986, 

12 (ii) shall be paid on notice and de13 mand by the Secretary and in the same 

14 manner as tax under such Code, and 

15 (iii) with respect to which only civil 

16 actions for refund under procedures of 

17 such subtitle F shall apply. 

18 (g) SECRETARY.—For purposes of this section, the 

19 term ‘‘Secretary’’ means the Secretary of the Treasury or 

20 the Secretary’s delegate. 

21 (h) GUIDANCE.—The Secretary shall publish guid22 ance necessary to carry out the purposes of this section, 

23 including identification of medical devices described in 

24 subsection (d)(1)(A) and with respect to the treatment of 

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1 ered entity or to another entity by reason of the applica2 tion of subsection (c)(2). 

3 (i) APPLICATION OF SECTION.—This section shall 

4 apply to any medical device sales after December 31, 

5 2008. 

6 SEC. 9010. IMPOSITION OF ANNUAL FEE ON HEALTH INSUR7 ANCE PROVIDERS. 

8 (a) IMPOSITION OF FEE.— 

9 (1) IN GENERAL.—Each covered entity engaged 

10 in the business of providing health insurance shall 

11 pay to the Secretary not later than the annual pay12 ment date of each calendar year beginning after 

13 2009 a fee in an amount determined under sub14 section (b). 

15 (2) ANNUAL PAYMENT DATE.—For purposes of 

16 this section, the term ‘‘annual payment date’’ means 

17 with respect to any calendar year the date deter18 mined by the Secretary, but in no event later than 

19 September 30 of such calendar year. 

20 (b) DETERMINATION OF FEE AMOUNT.— 

21 (1) IN GENERAL.—With respect to each covered 

22 entity, the fee under this section for any calendar 

23 year shall be equal to an amount that bears the 

24 same ratio to $6,700,000,000 as— 

25 (A) the sum of— 


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1 (i) the covered entity’s net premiums 

2 written with respect to health insurance for 

3 any United States health risk that are 

4 taken into account during the preceding 

5 calendar year, plus 

6 (ii) 200 percent of the covered entity’s 

7 third party administration agreement fees 

8 that are taken into account during the pre9 ceding calendar year, bears to 

10 (B) the sum of— 

11 (i) the aggregate net premiums writ12 ten with respect to such health insurance 

13 of all covered entities that are taken into 

14 account during such preceding calendar 

15 year, plus 

16 (ii) 200 percent of the aggregate third 

17 party administration agreement fees of all 

18 covered entities that are taken into account 

19 during such preceding calendar year. 

20 (2) AMOUNTS TAKEN INTO ACCOUNT.—For 

21 purposes of paragraph (1)— 

22 (A) NET PREMIUMS WRITTEN.—The net 

23 premiums written with respect to health insur24 ance for any United States health risk that are 

25 taken into account during any calendar year 


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1 with respect to any covered entity shall be de2 termined 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 (B) THIRD PARTY ADMINISTRATION

4 AGREEMENT FEES.—The third party adminis5 tration agreement fees that are taken into ac6 count during any calendar year with respect to 

7 any covered entity shall be determined in ac8 cordance 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. 

9 (3) SECRETARIAL DETERMINATION.—The Sec10 retary shall calculate the amount of each covered en11 tity’s fee for any calendar year under paragraph (1). 

12 In calculating such amount, the Secretary shall de13 termine such covered entity’s net premiums written 

14 with respect to any United States health risk and 

15 third party administration agreement fees on the 


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1 basis of reports submitted by the covered entity 

2 under subsection (g) and through the use of any 

3 other source of information available to the Sec4 retary. 

5 (c) COVERED ENTITY.— 

6 (1) IN GENERAL.—For purposes of this section, 

7 the term ‘‘covered entity’’ means any entity which 

8 provides health insurance for any United States 

9 health risk. 

10 (2) EXCLUSION.—Such term does not include— 

11 (A) any employer to the extent that such 

12 employer self-insures its employees’ health 

13 risks, or 

14 (B) any governmental entity (except to the 

15 extent such an entity provides health insurance 

16 coverage through the community health insur17 ance option under section 1323). 

18 (3) CONTROLLED GROUPS.— 

19 (A) IN GENERAL.—For purposes of this 

20 subsection, all persons treated as a single em21 ployer under subsection (a) or (b) of section 52 

22 of the Internal Revenue Code of 1986 or sub23 section (m) or (o) of section 414 of such Code 

24 shall be treated as a single covered entity (or 

25 employer for purposes of paragraph (2)). 


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1 (B) INCLUSION OF FOREIGN CORPORA2 TIONS.—For purposes of subparagraph (A), in 

3 applying subsections (a) and (b) of section 52 

4 of such Code to this section, section 1563 of 

5 such Code shall be applied without regard to 

6 subsection (b)(2)(C) thereof. 

7 (d) UNITED STATES HEALTH RISK.—For purposes 

8 of this section, the term ‘‘United States health risk’’ 

9 means the health risk of any individual who is— 

10 (1) a United States citizen, 

11 (2) a resident of the United States (within the 

12 meaning of section 7701(b)(1)(A) of the Internal 

13 Revenue Code of 1986), or 

14 (3) located in the United States, with respect to 

15 the period such individual is so located. 

16 (e) THIRD PARTY ADMINISTRATION AGREEMENT

17 FEES.—For purposes of this section, the term ‘‘third 

18 party administration agreement fees’’ means, with respect 

19 to any covered entity, amounts received from an employer 

20 which are in excess of payments made by such covered 

21 entity for health benefits under an arrangement under 

22 which such employer self-insures the United States health 

23 risk of its employees. 

24 (f) TAX TREATMENT OF FEES.—The fees imposed 

25 by this section— 


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1 (1) for purposes of subtitle F of the Internal 

2 Revenue Code of 1986, shall be treated as excise 

3 taxes with respect to which only civil actions for re4 fund under procedures of such subtitle shall apply, 

5 and 

6 (2) for purposes of section 275 of such Code 

7 shall be considered to be a tax described in section 

8 275(a)(6). 

9 (g) REPORTING REQUIREMENT.— 

10 (1) IN GENERAL.—Not later than the date de11 termined by the Secretary following the end of any 

12 calendar year, each covered entity shall report to the 

13 Secretary, in such manner as the Secretary pre14 scribes, the covered entity’s net premiums written 

15 with respect to health insurance for any United 

16 States health risk and third party administration 

17 agreement fees for such calendar year. 

18 (2) PENALTY FOR FAILURE TO REPORT.— 

19 (A) IN GENERAL.—In the case of any fail20 ure to make a report containing the information 

21 required by paragraph (1) on the date pre22 scribed therefor (determined with regard to any 

23 extension of time for filing), unless it is shown 

24 that such failure is due to reasonable cause, 


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1 there shall be paid by the covered entity failing 

2 to file such report, an amount equal to— 

3 (i) $10,000, plus 

4 (ii) the lesser of— 

5 (I) an amount equal to $1,000, 

6 multiplied by the number of days dur7 ing which such failure continues, or 

8 (II) the amount of the fee im9 posed by this section for which such 

10 report was required. 

11 (B) TREATMENT OF PENALTY.—The pen12 alty imposed under subparagraph (A)— 

13 (i) shall be treated as a penalty for 

14 purposes of subtitle F of the Internal Rev15 enue Code of 1986, 

16 (ii) shall be paid on notice and de17 mand by the Secretary and in the same 

18 manner as tax under such Code, and 

19 (iii) with respect to which only civil 

20 actions for refund under procedures of 

21 such subtitle F shall apply. 

22 (h) ADDITIONAL DEFINITIONS.—For purposes of 

23 this section— 


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1 (1) SECRETARY.—The term ‘‘Secretary’’ means 

2 the Secretary of the Treasury or the Secretary’s del3 egate. 

4 (2) UNITED STATES.—The term ‘‘United 

5 States’’ means the several States, the District of Co6 lumbia, the Commonwealth of Puerto Rico, and the 

7 possessions of the United States. 

8 (3) HEALTH INSURANCE.—The term ‘‘health 

9 insurance’’ shall not include insurance for long-term 

10 care or disability. 

11 (i) GUIDANCE.—The Secretary shall publish guidance 

12 necessary to carry out the purposes of this section. 

13 (j) APPLICATION OF SECTION.—This section shall 

14 apply to any net premiums written after December 31, 

15 2008, with respect to health insurance for any United 

16 States health risk, and any third party administration 

17 agreement fees received after such date. 

18 SEC. 9011. STUDY AND REPORT OF EFFECT ON VETERANS 

19 HEALTH CARE. 

20 (a) IN GENERAL.—The Secretary of Veterans Affairs 

21 shall conduct a study on the effect (if any) of the provi22 sions of sections 9008, 9009, and 9010 on— 

23 (1) the cost of medical care provided to vet24 erans, and 


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•AMDT. NO. 2786 

1 (2) veterans’ access to medical devices and 

2 branded prescription drugs. 

3 (b) REPORT.—The Secretary of Veterans Affairs 

4 shall report the results of the study under subsection (a) 

5 to the Committee on Ways and Means of the House of 

6 Representatives and to the Committee on Finance of the 

7 Senate not later than December 31, 2012. 

8 SEC. 9012. ELIMINATION OF DEDUCTION FOR EXPENSES 

9 ALLOCABLE TO MEDICARE PART D SUBSIDY. 

10 (a) IN GENERAL.—Section 139A of the Internal Rev11 enue Code of 1986 is amended by striking the second sen12 tence. 

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

14 this section shall apply to taxable years beginning after 

15 December 31, 2010. 

16 SEC. 9013. MODIFICATION OF ITEMIZED DEDUCTION FOR 

17 MEDICAL EXPENSES. 

18 (a) IN GENERAL.—Subsection (a) of section 213 of 

19 the Internal Revenue Code of 1986 is amended by striking 

20 ‘‘7.5 percent’’ and inserting ‘‘10 percent’’. 

21 (b) TEMPORARY WAIVER OF INCREASE FOR CERTAIN

22 SENIORS.—Section 213 of the Internal Revenue Code of 

23 1986 is amended by adding at the end the following new 

24 subsection: 


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1 ‘‘(f) SPECIAL RULE FOR 2013, 2014, 2015, AND

2 2016.—In the case of any taxable year beginning after 

3 December 31, 2012, and ending before January 1, 2017, 

4 subsection (a) shall be applied with respect to a taxpayer 

5 by substituting ‘7.5 percent’ for ‘10 percent’ if such tax6 payer or such taxpayer’s spouse has attained age 65 before 

7 the close of such taxable year.’’. 

8 (c) CONFORMING AMENDMENT.—Section 

9 56(b)(1)(B) of the Internal Revenue Code of 1986 is 

10 amended by striking ‘‘by substituting ‘10 percent’ for ‘7.5 

11 percent’ ’’ and inserting ‘‘without regard to subsection (f) 

12 of such section’’. 

13 (d) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to taxable years beginning after 

15 December 31, 2012. 

16 SEC. 9014. LIMITATION ON EXCESSIVE REMUNERATION 

17 PAID BY CERTAIN HEALTH INSURANCE PRO18 VIDERS. 

19 (a) IN GENERAL.—Section 162(m) of the Internal 

20 Revenue Code of 1986 is amended by adding at the end 

21 the following new subparagraph: 

22 ‘‘(6) SPECIAL RULE FOR APPLICATION TO CER23 TAIN HEALTH INSURANCE PROVIDERS.— 

24 ‘‘(A) IN GENERAL.—No deduction shall be 

25 allowed under this chapter— 


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•AMDT. NO. 2786 

1 ‘‘(i) in the case of applicable indi2 vidual remuneration which is for any dis3 qualified taxable year beginning after De4 cember 31, 2012, and which is attributable 

5 to services performed by an applicable indi6 vidual during such taxable year, to the ex7 tent that the amount of such remuneration 

8 exceeds $500,000, or 

9 ‘‘(ii) in the case of deferred deduction 

10 remuneration for any taxable year begin11 ning after December 31, 2012, which is at12 tributable to services performed by an ap13 plicable individual during any disqualified 

14 taxable year beginning after December 31, 

15 2009, to the extent that the amount of 

16 such remuneration exceeds $500,000 re17 duced (but not below zero) by the sum 

18 of— 

19 ‘‘(I) the applicable individual re20 muneration for such disqualified tax21 able year, plus 

22 ‘‘(II) the portion of the deferred 

23 deduction remuneration for such serv24 ices which was taken into account 

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•AMDT. NO. 2786 

1 able year (or which would have been 

2 taken into account under this clause 

3 in a preceding taxable year if this 

4 clause were applied by substituting 

5 ‘December 31, 2009’ for ‘December 

6 31, 2012’ in the matter preceding 

7 subclause (I)). 

8 ‘‘(B) DISQUALIFIED TAXABLE YEAR.—For 

9 purposes of this paragraph, the term ‘disquali10 fied taxable year’ means, with respect to any 

11 employer, any taxable year for which such em12 ployer is a covered health insurance provider. 

13 ‘‘(C) COVERED HEALTH INSURANCE PRO14 VIDER.—For purposes of this paragraph— 

15 ‘‘(i) IN GENERAL.—The term ‘covered 

16 health insurance provider’ means— 

17 ‘‘(I) with respect to taxable years 

18 beginning after December 31, 2009, 

19 and before January 1, 2013, any em20 ployer which is a health insurance 

21 issuer (as defined in section 

22 9832(b)(2)) and which receives pre23 miums from providing health insur24 ance coverage (as defined in section 

25 9832(b)(1)), and 


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1 ‘‘(II) with respect to taxable 

2 years beginning after December 31, 

3 2012, any employer which is a health 

4 insurance issuer (as defined in section 

5 9832(b)(2)) and with respect to which 

6 not less than 25 percent of the gross 

7 premiums received from providing 

8 health insurance coverage (as defined 

9 in section 9832(b)(1)) is from min10 imum essential coverage (as defined in 

11 section 5000A(f)). 

12 ‘‘(ii) AGGREGATION RULES.—Two or 

13 more persons who are treated as a single 

14 employer under subsection (b), (c), (m), or 

15 (o) of section 414 shall be treated as a sin16 gle employer, except that in applying sec17 tion 1563(a) for purposes of any such sub18 section, paragraphs (2) and (3) thereof 

19 shall be disregarded. 

20 ‘‘(D) APPLICABLE INDIVIDUAL REMUNERA21 TION.—For purposes of this paragraph, the 

22 term ‘applicable individual remuneration’ 

23 means, with respect to any applicable individual 

24 for any disqualified taxable year, the aggregate 

25 amount allowable as a deduction under this 


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•AMDT. NO. 2786 

1 chapter for such taxable year (determined with2 out regard to this subsection) for remuneration 

3 (as defined in paragraph (4) without regard to 

4 subparagraphs (B), (C), and (D) thereof) for 

5 services performed by such individual (whether 

6 or not during the taxable year). Such term shall 

7 not include any deferred deduction remunera8 tion with respect to services performed during 

9 the disqualified taxable year. 

10 ‘‘(E) DEFERRED DEDUCTION REMUNERA11 TION.—For purposes of this paragraph, the 

12 term ‘deferred deduction remuneration’ means 

13 remuneration which would be applicable indi14 vidual remuneration for services performed in a 

15 disqualified taxable year but for the fact that 

16 the deduction under this chapter (determined 

17 without regard to this paragraph) for such re18 muneration is allowable in a subsequent taxable 

19 year. 

20 ‘‘(F) APPLICABLE INDIVIDUAL.—For pur21 poses of this paragraph, the term ‘applicable in22 dividual’ means, with respect to any covered 

23 health insurance provider for any disqualified 

24 taxable year, any individual— 


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1 ‘‘(i) who is an officer, director, or em2 ployee in such taxable year, or 

3 ‘‘(ii) who provides services for or on 

4 behalf of such covered health insurance 

5 provider during such taxable year. 

6 ‘‘(G) COORDINATION.—Rules similar to 

7 the rules of subparagraphs (F) and (G) of para8 graph (4) shall apply for purposes of this para9 graph. 

10 ‘‘(H) REGULATORY AUTHORITY.—The Sec11 retary may prescribe such guidance, rules, or 

12 regulations as are necessary to carry out the 

13 purposes of this paragraph.’’. 

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

15 this section shall apply to taxable years beginning after 

16 December 31, 2009, with respect to services performed 

17 after such date. 

18 SEC. 9015. ADDITIONAL HOSPITAL INSURANCE TAX ON 

19 HIGH-INCOME TAXPAYERS. 

20 (a) FICA.— 

21 (1) IN GENERAL.—Section 3101(b) of the In22 ternal Revenue Code of 1986 is amended— 

23 (A) by striking ‘‘In addition’’ and inserting 

24 the following: 

25 ‘‘(1) IN GENERAL.—In addition’’, 


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•AMDT. NO. 2786 

1 (B) by striking ‘‘the following percentages 

2 of the’’ and inserting ‘‘1.45 percent of the’’, 

3 (C) by striking ‘‘(as defined in section 

4 3121(b))—’’ and all that follows and inserting 

5 ‘‘(as defined in section 3121(b)).’’, and 

6 (D) by adding at the end the following new 

7 paragraph: 

8 ‘‘(2) ADDITIONAL TAX.—In addition to the tax 

9 imposed by paragraph (1) and the preceding sub10 section, there is hereby imposed on every taxpayer 

11 (other than a corporation, estate, or trust) a tax 

12 equal to 0.5 percent of wages which are received 

13 with respect to employment (as defined in section 

14 3121(b)) during any taxable year beginning after 

15 December 31, 2012, and which are in excess of— 

16 ‘‘(A) in the case of a joint return, 

17 $250,000, and 

18 ‘‘(B) in any other case, $200,000.’’. 

19 (2) COLLECTION OF TAX.—Section 3102 of the 

20 Internal Revenue Code of 1986 is amended by add21 ing at the end the following new subsection: 

22 ‘‘(f) SPECIAL RULES FOR ADDITIONAL TAX.— 

23 ‘‘(1) IN GENERAL.—In the case of any tax im24 posed by section 3101(b)(2), subsection (a) shall 

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•AMDT. NO. 2786 

1 ceives wages from the employer in excess of 

2 $200,000, and the employer may disregard the 

3 amount of wages received by such taxpayer’s spouse. 

4 ‘‘(2) COLLECTION OF AMOUNTS NOT WITH5 HELD.—To the extent that the amount of any tax 

6 imposed by section 3101(b)(2) is not collected by the 

7 employer, such tax shall be paid by the employee. 

8 ‘‘(3) TAX PAID BY RECIPIENT.—If an employer, 

9 in violation of this chapter, fails to deduct and with10 hold the tax imposed by section 3101(b)(2) and 

11 thereafter the tax is paid by the employee, the tax 

12 so required to be deducted and withheld shall not be 

13 collected from the employer, but this paragraph shall 

14 in no case relieve the employer from liability for any 

15 penalties or additions to tax otherwise applicable in 

16 respect of such failure to deduct and withhold.’’. 

17 (b) SECA.— 

18 (1) IN GENERAL.—Section 1401(b) of the In19 ternal Revenue Code of 1986 is amended— 

20 (A) by striking ‘‘In addition’’ and inserting 

21 the following: 

22 ‘‘(1) IN GENERAL.—In addition’’, and 

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

24 paragraph: 

25 ‘‘(2) ADDITIONAL TAX.— 


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1 ‘‘(A) IN GENERAL.—In addition to the tax 

2 imposed by paragraph (1) and the preceding 

3 subsection, there is hereby imposed on every 

4 taxpayer (other than a corporation, estate, or 

5 trust) for each taxable year beginning after De6 cember 31, 2012, a tax equal to 0.5 percent of 

7 the self-employment income for such taxable 

8 year which is in excess of— 

9 ‘‘(i) in the case of a joint return, 

10 $250,000, and 

11 ‘‘(ii) in any other case, $200,000. 

12 ‘‘(B) COORDINATION WITH FICA.—The 

13 amounts under clauses (i) and (ii) of subpara14 graph (A) shall be reduced (but not below zero) 

15 by the amount of wages taken into account in 

16 determining the tax imposed under section 

17 3121(b)(2) with respect to the taxpayer.’’. 

18 (2) NO DEDUCTION FOR ADDITIONAL TAX.— 

19 (A) IN GENERAL.—Section 164(f) of such 

20 Code is amended by inserting ‘‘(other than the 

21 taxes imposed by section 1401(b)(2))’’ after 

22 ‘‘section 1401)’’. 

23 (B) DEDUCTION FOR NET EARNINGS FROM

24 SELF-EMPLOYMENT.—Subparagraph (B) of sec25 tion 1402(a)(12) is amended by inserting ‘‘(deVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 02043 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 termined without regard to the rate imposed 

2 under paragraph (2) of section 1401(b))’’ after 

3 ‘‘for such year’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply with respect to remuneration re6 ceived, and taxable years beginning, after December 31, 

7 2012. 

8 SEC. 9016. MODIFICATION OF SECTION 833 TREATMENT OF 

9 CERTAIN HEALTH ORGANIZATIONS. 

10 (a) IN GENERAL.—Subsection (c) of section 833 of 

11 the Internal Revenue Code of 1986 is amended by adding 

12 at the end the following new paragraph: 

13 ‘‘(5) NONAPPLICATION OF SECTION IN CASE OF

14 LOW MEDICAL LOSS RATIO.—Notwithstanding the 

15 preceding paragraphs, this section shall not apply to 

16 any organization unless such organization’s percent17 age of total premium revenue expended on reim18 bursement for clinical services provided to enrollees 

19 under its policies during such taxable year (as re20 ported under section 2718 of the Public Health 

21 Service Act) is not less than 85 percent.’’. 

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

23 this section shall apply to taxable years beginning after 

24 December 31, 2009. 


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1 SEC. 9017. EXCISE TAX ON ELECTIVE COSMETIC MEDICAL 

2 PROCEDURES. 

3 (a) IN GENERAL.—Subtitle D of the Internal Rev4 enue Code of 1986, as amended by this Act, is amended 

5 by adding at the end the following new chapter: 

6 ‘‘CHAPTER 49—ELECTIVE COSMETIC 

7 MEDICAL PROCEDURES 

‘‘Sec. 5000B. Imposition of tax on elective cosmetic medical procedures. 

8 ‘‘SEC. 5000B. IMPOSITION OF TAX ON ELECTIVE COSMETIC 

9 MEDICAL PROCEDURES. 

10 ‘‘(a) IN GENERAL.—There is hereby imposed on any 

11 cosmetic surgery and medical procedure a tax equal to 5 

12 percent of the amount paid for such procedure (deter13 mined without regard to this section), whether paid by in14 surance or otherwise. 

15 ‘‘(b) COSMETIC SURGERY AND MEDICAL PROCE16 DURE.—For purposes of this section, the term ‘cosmetic 

17 surgery and medical procedure’ means any cosmetic sur18 gery (as defined in section 213(d)(9)(B)) or other similar 

19 procedure which— 

20 ‘‘(1) is performed by a licensed medical profes21 sional, and 

22 ‘‘(2) is not necessary to ameliorate a deformity 

23 arising from, or directly related to, a congenital ab24 normality, a personal injury resulting from an acci25 dent or trauma, or disfiguring disease. 


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1 ‘‘(c) PAYMENT OF TAX.— 

2 ‘‘(1) IN GENERAL.—The tax imposed by this 

3 section shall be paid by the individual on whom the 

4 procedure is performed. 

5 ‘‘(2) COLLECTION.—Every person receiving a 

6 payment for procedures on which a tax is imposed 

7 under subsection (a) shall collect the amount of the 

8 tax from the individual on whom the procedure is 

9 performed and remit such tax quarterly to the Sec10 retary at such time and in such manner as provided 

11 by the Secretary. 

12 ‘‘(3) SECONDARY LIABILITY.—Where any tax 

13 imposed by subsection (a) is not paid at the time 

14 payments for cosmetic surgery and medical proce15 dures are made, then to the extent that such tax is 

16 not collected, such tax shall be paid by the person 

17 who performs the procedure.’’. 

18 (b) CLERICAL AMENDMENT.—The table of chapters 

19 for subtitle D of the Internal Revenue Code of 1986, as 

20 amended by this Act, is amended by inserting after the 

21 item relating to chapter 48 the following new item: 

‘‘CHAPTER 49—ELECTIVE COSMETIC MEDICAL PROCEDURES’’. 

22 (c) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to procedures performed on or 

24 after January 1, 2010. 


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1 Subtitle B—Other Provisions 

2 SEC. 9021. EXCLUSION OF HEALTH BENEFITS PROVIDED BY 

3 INDIAN TRIBAL GOVERNMENTS. 

4 (a) IN GENERAL.—Part III of subchapter B of chap5 ter 1 of the Internal Revenue Code of 1986 is amended 

6 by inserting after section 139C the following new section: 

7 ‘‘SEC. 139D. INDIAN HEALTH CARE BENEFITS. 

8 ‘‘(a) GENERAL RULE.—Except as otherwise provided 

9 in this section, gross income does not include the value 

10 of any qualified Indian health care benefit. 

11 ‘‘(b) QUALIFIED INDIAN HEALTH CARE BENEFIT.— 

12 For purposes of this section, the term ‘qualified Indian 

13 health care benefit’ means— 

14 ‘‘(1) any health service or benefit provided or 

15 purchased, directly or indirectly, by the Indian 

16 Health Service through a grant to or a contract or 

17 compact with an Indian tribe or tribal organization, 

18 or through a third-party program funded by the In19 dian Health Service, 

20 ‘‘(2) medical care provided or purchased by, or 

21 amounts to reimburse for such medical care provided 

22 by, an Indian tribe or tribal organization for, or to, 

23 a member of an Indian tribe, including a spouse or 

24 dependent of such a member, 


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1 ‘‘(3) coverage under accident or health insur2 ance (or an arrangement having the effect of acci3 dent or health insurance), or an accident or health 

4 plan, provided by an Indian tribe or tribal organiza5 tion for medical care to a member of an Indian 

6 tribe, include a spouse or dependent of such a mem7 ber, and 

8 ‘‘(4) any other medical care provided by an In9 dian tribe or tribal organization that supplements, 

10 replaces, or substitutes for a program or service re11 lating to medical care provided by the Federal gov12 ernment to Indian tribes or members of such a tribe. 

13 ‘‘(c) DEFINITIONS.—For purposes of this section— 

14 ‘‘(1) INDIAN TRIBE.—The term ‘Indian tribe’ 

15 has the meaning given such term by section 

16 45A(c)(6). 

17 ‘‘(2) TRIBAL ORGANIZATION.—The term ‘tribal 

18 organization’ has the meaning given such term by 

19 section 4(l) of the Indian Self-Determination and 

20 Education Assistance Act. 

21 ‘‘(3) MEDICAL CARE.—The term ‘medical care’ 

22 has the same meaning as when used in section 213. 

23 ‘‘(4) ACCIDENT OR HEALTH INSURANCE; ACCI24 DENT OR HEALTH PLAN.—The terms ‘accident or 


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1 health insurance’ and ‘accident or health plan’ have 

2 the same meaning as when used in section 105. 

3 ‘‘(5) DEPENDENT.—The term ‘dependent’ has 

4 the meaning given such term by section 152, deter5 mined without regard to subsections (b)(1), (b)(2), 

6 and (d)(1)(B) thereof. 

7 ‘‘(d) DENIAL OF DOUBLE BENEFIT.—Subsection (a) 

8 shall not apply to the amount of any qualified Indian 

9 health care benefit which is not includible in gross income 

10 of the beneficiary of such benefit under any other provi11 sion of this chapter, or to the amount of any such benefit 

12 for which a deduction is allowed to such beneficiary under 

13 any other provision of this chapter.’’. 

14 (b) CLERICAL AMENDMENT.—The table of sections 

15 for part III of subchapter B of chapter 1 of the Internal 

16 Revenue Code of 1986 is amended by inserting after the 

17 item relating to section 139C the following new item: 

‘‘Sec. 139D. Indian health care benefits.’’. 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to benefits and coverage provided 

20 after the date of the enactment of this Act. 

21 (d) NO INFERENCE.—Nothing in the amendments 

22 made by this section shall be construed to create an infer23 ence with respect to the exclusion from gross income of— 


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1 (1) benefits provided by an Indian tribe or trib2 al organization that are not within the scope of this 

3 section, and 

4 (2) benefits provided prior to the date of the 

5 enactment of this Act. 

6 SEC. 9022. ESTABLISHMENT OF SIMPLE CAFETERIA PLANS 

7 FOR SMALL BUSINESSES. 

8 (a) IN GENERAL.—Section 125 of the Internal Rev9 enue Code of 1986 (relating to cafeteria plans), as amend10 ed by this Act, is amended by redesignating subsections 

11 (j) and (k) as subsections (k) and (l), respectively, and 

12 by inserting after subsection (i) the following new sub13 section: 

14 ‘‘(j) SIMPLE CAFETERIA PLANS FOR SMALL BUSI15 NESSES.— 

16 ‘‘(1) IN GENERAL.—An eligible employer main17 taining a simple cafeteria plan with respect to which 

18 the requirements of this subsection are met for any 

19 year shall be treated as meeting any applicable non20 discrimination requirement during such year. 

21 ‘‘(2) SIMPLE CAFETERIA PLAN.—For purposes 

22 of this subsection, the term ‘simple cafeteria plan’ 

23 means a cafeteria plan— 

24 ‘‘(A) which is established and maintained 

25 by an eligible employer, and 


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1 ‘‘(B) with respect to which the contribution 

2 requirements of paragraph (3), and the eligi3 bility and participation requirements of para4 graph (4), are met. 

5 ‘‘(3) CONTRIBUTION REQUIREMENTS.— 

6 ‘‘(A) IN GENERAL.—The requirements of 

7 this paragraph are met if, under the plan the 

8 employer is required, without regard to whether 

9 a qualified employee makes any salary reduc10 tion contribution, to make a contribution to 

11 provide qualified benefits under the plan on be12 half of each qualified employee in an amount 

13 equal to— 

14 ‘‘(i) a uniform percentage (not less 

15 than 2 percent) of the employee’s com16 pensation for the plan year, or 

17 ‘‘(ii) an amount which is not less than 

18 the lesser of— 

19 ‘‘(I) 6 percent of the employee’s 

20 compensation for the plan year, or 

21 ‘‘(II) twice the amount of the sal22 ary reduction contributions of each 

23 qualified employee. 

24 ‘‘(B) MATCHING CONTRIBUTIONS ON BE25 HALF OF HIGHLY COMPENSATED AND KEY EMVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 02051 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 PLOYEES.—The requirements of subparagraph 

2 (A)(ii) shall not be treated as met if, under the 

3 plan, the rate of contributions with respect to 

4 any salary reduction contribution of a highly 

5 compensated or key employee at any rate of 

6 contribution is greater than that with respect to 

7 an employee who is not a highly compensated or 

8 key employee. 

9 ‘‘(C) ADDITIONAL CONTRIBUTIONS.—Sub10 ject to subparagraph (B), nothing in this para11 graph shall be treated as prohibiting an em12 ployer from making contributions to provide 

13 qualified benefits under the plan in addition to 

14 contributions required under subparagraph (A). 

15 ‘‘(D) DEFINITIONS.—For purposes of this 

16 paragraph— 

17 ‘‘(i) SALARY REDUCTION CONTRIBU18 TION.—The term ‘salary reduction con19 tribution’ means, with respect to a cafe20 teria plan, any amount which is contrib21 uted to the plan at the election of the em22 ployee and which is not includible in gross 

23 income by reason of this section. 

24 ‘‘(ii) QUALIFIED EMPLOYEE.—The 

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1 spect to a cafeteria plan, any employee who 

2 is not a highly compensated or key em3 ployee and who is eligible to participate in 

4 the plan. 

5 ‘‘(iii) HIGHLY COMPENSATED EM6 PLOYEE.—The term ‘highly compensated 

7 employee’ has the meaning given such term 

8 by section 414(q). 

9 ‘‘(iv) KEY EMPLOYEE.—The term ‘key 

10 employee’ has the meaning given such term 

11 by section 416(i). 

12 ‘‘(4) MINIMUM ELIGIBILITY AND PARTICIPA13 TION REQUIREMENTS.— 

14 ‘‘(A) IN GENERAL.—The requirements of 

15 this paragraph shall be treated as met with re16 spect to any year if, under the plan— 

17 ‘‘(i) all employees who had at least 

18 1,000 hours of service for the preceding 

19 plan year are eligible to participate, and 

20 ‘‘(ii) each employee eligible to partici21 pate in the plan may, subject to terms and 

22 conditions applicable to all participants, 

23 elect any benefit available under the plan. 

24 ‘‘(B) CERTAIN EMPLOYEES MAY BE EX25 CLUDED.—For purposes of subparagraph 


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1 (A)(i), an employer may elect to exclude under 

2 the plan employees— 

3 ‘‘(i) who have not attained the age of 

4 21 before the close of a plan year, 

5 ‘‘(ii) who have less than 1 year of 

6 service with the employer as of any day 

7 during the plan year, 

8 ‘‘(iii) who are covered under an agree9 ment which the Secretary of Labor finds to 

10 be a collective bargaining agreement if 

11 there is evidence that the benefits covered 

12 under the cafeteria plan were the subject 

13 of good faith bargaining between employee 

14 representatives and the employer, or 

15 ‘‘(iv) who are described in section 

16 410(b)(3)(C) (relating to nonresident 

17 aliens working outside the United States). 

18 A plan may provide a shorter period of service 

19 or younger age for purposes of clause (i) or (ii). 

20 ‘‘(5) ELIGIBLE EMPLOYER.—For purposes of 

21 this subsection— 

22 ‘‘(A) IN GENERAL.—The term ‘eligible em23 ployer’ means, with respect to any year, any 

24 employer if such employer employed an average 

25 of 100 or fewer employees on business days 


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1 during either of the 2 preceding years. For pur2 poses of this subparagraph, a year may only be 

3 taken into account if the employer was in exist4 ence throughout the year. 

5 ‘‘(B) EMPLOYERS NOT IN EXISTENCE DUR6 ING PRECEDING YEAR.—If an employer was not 

7 in existence throughout the preceding year, the 

8 determination under subparagraph (A) shall be 

9 based on the average number of employees that 

10 it is reasonably expected such employer will em11 ploy on business days in the current year. 

12 ‘‘(C) GROWING EMPLOYERS RETAIN

13 TREATMENT AS SMALL EMPLOYER.— 

14 ‘‘(i) IN GENERAL.—If— 

15 ‘‘(I) an employer was an eligible 

16 employer for any year (a ‘qualified 

17 year’), and 

18 ‘‘(II) such employer establishes a 

19 simple cafeteria plan for its employees 

20 for such year, 

21 then, notwithstanding the fact the em22 ployer fails to meet the requirements of 

23 subparagraph (A) for any subsequent year, 

24 such employer shall be treated as an eligi25 ble employer for such subsequent year with 


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1 respect to employees (whether or not em2 ployees during a qualified year) of any 

3 trade or business which was covered by the 

4 plan during any qualified year. 

5 ‘‘(ii) EXCEPTION.—This subpara6 graph shall cease to apply if the employer 

7 employs an average of 200 or more em8 ployees on business days during any year 

9 preceding any such subsequent year. 

10 ‘‘(D) SPECIAL RULES.— 

11 ‘‘(i) PREDECESSORS.—Any reference 

12 in this paragraph to an employer shall in13 clude a reference to any predecessor of 

14 such employer. 

15 ‘‘(ii) AGGREGATION RULES.—All per16 sons treated as a single employer under 

17 subsection (a) or (b) of section 52, or sub18 section (n) or (o) of section 414, shall be 

19 treated as one person. 

20 ‘‘(6) APPLICABLE NONDISCRIMINATION RE21 QUIREMENT.—For purposes of this subsection, the 

22 term ‘applicable nondiscrimination requirement’ 

23 means any requirement under subsection (b) of this 

24 section, section 79(d), section 105(h), or paragraph 

25 (2), (3), (4), or (8) of section 129(d). 


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1 ‘‘(7) COMPENSATION.—The term ‘compensa2 tion’ has the meaning given such term by section 

3 414(s).’’. 

4 (b) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to years beginning after December 

6 31, 2010. 

7 SEC. 9023. QUALIFYING THERAPEUTIC DISCOVERY 

8 PROJECT CREDIT. 

9 (a) IN GENERAL.—Subpart E of part IV of sub10 chapter A of chapter 1 of the Internal Revenue Code of 

11 1986 is amended by inserting after section 48C the fol12 lowing new section: 

13 ‘‘SEC. 48D. QUALIFYING THERAPEUTIC DISCOVERY 

14 PROJECT CREDIT. 

15 ‘‘(a) IN GENERAL.—For purposes of section 46, the 

16 qualifying therapeutic discovery project credit for any tax17 able year is an amount equal to 50 percent of the qualified 

18 investment for such taxable year with respect to any quali19 fying therapeutic discovery project of an eligible taxpayer. 

20 ‘‘(b) QUALIFIED INVESTMENT.— 

21 ‘‘(1) IN GENERAL.—For purposes of subsection 

22 (a), the qualified investment for any taxable year is 

23 the aggregate amount of the costs paid or incurred 

24 in such taxable year for expenses necessary for and 


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1 directly related to the conduct of a qualifying thera2 peutic discovery project. 

3 ‘‘(2) LIMITATION.—The amount which is treat4 ed as qualified investment for all taxable years with 

5 respect to any qualifying therapeutic discovery 

6 project shall not exceed the amount certified by the 

7 Secretary as eligible for the credit under this sec8 tion. 

9 ‘‘(3) EXCLUSIONS.—The qualified investment 

10 for any taxable year with respect to any qualifying 

11 therapeutic discovery project shall not take into ac12 count any cost— 

13 ‘‘(A) for remuneration for an employee de14 scribed in section 162(m)(3), 

15 ‘‘(B) for interest expenses, 

16 ‘‘(C) for facility maintenance expenses, 

17 ‘‘(D) which is identified as a service cost 

18 under section 1.263A-1(e)(4) of title 26, Code 

19 of Federal Regulations, or 

20 ‘‘(E) for any other expense as determined 

21 by the Secretary as appropriate to carry out the 

22 purposes of this section. 

23 ‘‘(4) CERTAIN PROGRESS EXPENDITURE RULES

24 MADE APPLICABLE.—In the case of costs described 

25 in paragraph (1) that are paid for property of a 


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1 character subject to an allowance for depreciation, 

2 rules similar to the rules of subsections (c)(4) and 

3 (d) of section 46 (as in effect on the day before the 

4 date of the enactment of the Revenue Reconciliation 

5 Act of 1990) shall apply for purposes of this section. 

6 ‘‘(5) APPLICATION OF SUBSECTION.—An invest7 ment shall be considered a qualified investment 

8 under this subsection only if such investment is 

9 made in a taxable year beginning in 2009 or 2010. 

10 ‘‘(c) DEFINITIONS.— 

11 ‘‘(1) QUALIFYING THERAPEUTIC DISCOVERY

12 PROJECT.—The term ‘qualifying therapeutic dis13 covery project’ means a project which is designed— 

14 ‘‘(A) to treat or prevent diseases or condi15 tions by conducting pre-clinical activities, clin16 ical trials, and clinical studies, or carrying out 

17 research protocols, for the purpose of securing 

18 approval of a product under section 505(b) of 

19 the Federal Food, Drug, and Cosmetic Act or 

20 section 351(a) of the Public Health Service Act, 

21 ‘‘(B) to diagnose diseases or conditions or 

22 to determine molecular factors related to dis23 eases or conditions by developing molecular 

24 diagnostics to guide therapeutic decisions, or 


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1 ‘‘(C) to develop a product, process, or tech2 nology to further the delivery or administration 

3 of therapeutics. 

4 ‘‘(2) ELIGIBLE TAXPAYER.— 

5 ‘‘(A) IN GENERAL.—The term ‘eligible tax6 payer’ means a taxpayer which employs not 

7 more than 250 employees in all businesses of 

8 the taxpayer at the time of the submission of 

9 the application under subsection (d)(2). 

10 ‘‘(B) AGGREGATION RULES.—All persons 

11 treated as a single employer under subsection 

12 (a) or (b) of section 52, or subsection (m) or 

13 (o) of section 414, shall be so treated for pur14 poses of this paragraph. 

15 ‘‘(3) FACILITY MAINTENANCE EXPENSES.—The 

16 term ‘facility maintenance expenses’ means costs 

17 paid or incurred to maintain a facility, including— 

18 ‘‘(A) mortgage or rent payments, 

19 ‘‘(B) insurance payments, 

20 ‘‘(C) utility and maintenance costs, and 

21 ‘‘(D) costs of employment of maintenance 

22 personnel. 

23 ‘‘(d) QUALIFYING THERAPEUTIC DISCOVERY

24 PROJECT PROGRAM.— 

25 ‘‘(1) ESTABLISHMENT.— 


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1 ‘‘(A) IN GENERAL.—Not later than 60 

2 days after the date of the enactment of this sec3 tion, the Secretary, in consultation with the 

4 Secretary of Health and Human Services, shall 

5 establish a qualifying therapeutic discovery 

6 project program to consider and award certifi7 cations for qualified investments eligible for 

8 credits under this section to qualifying thera9 peutic discovery project sponsors. 

10 ‘‘(B) LIMITATION.—The total amount of 

11 credits that may be allocated under the pro12 gram shall not exceed $1,000,000,000 for the 

13 2-year period beginning with 2009. 

14 ‘‘(2) CERTIFICATION.— 

15 ‘‘(A) APPLICATION PERIOD.—Each appli16 cant for certification under this paragraph shall 

17 submit an application containing such informa18 tion as the Secretary may require during the 

19 period beginning on the date the Secretary es20 tablishes the program under paragraph (1). 

21 ‘‘(B) TIME FOR REVIEW OF APPLICA22 TIONS.—The Secretary shall take action to ap23 prove or deny any application under subpara24 graph (A) within 30 days of the submission of 

25 such application. 


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1 ‘‘(C) MULTI-YEAR APPLICATIONS.—An ap2 plication for certification under subparagraph 

3 (A) may include a request for an allocation of 

4 credits for more than 1 of the years described 

5 in paragraph (1)(B). 

6 ‘‘(3) SELECTION CRITERIA.—In determining 

7 the qualifying therapeutic discovery projects with re8 spect to which qualified investments may be certified 

9 under this section, the Secretary— 

10 ‘‘(A) shall take into consideration only 

11 those projects that show reasonable potential— 

12 ‘‘(i) to result in new therapies— 

13 ‘‘(I) to treat areas of unmet med14 ical need, or 

15 ‘‘(II) to prevent, detect, or treat 

16 chronic or acute diseases and condi17 tions, 

18 ‘‘(ii) to reduce long-term health care 

19 costs in the United States, or 

20 ‘‘(iii) to significantly advance the goal 

21 of curing cancer within the 30-year period 

22 beginning on the date the Secretary estab23 lishes the program under paragraph (1), 

24 and 


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1 ‘‘(B) shall take into consideration which 

2 projects have the greatest potential— 

3 ‘‘(i) to create and sustain (directly or 

4 indirectly) high quality, high-paying jobs in 

5 the United States, and 

6 ‘‘(ii) to advance United States com7 petitiveness in the fields of life, biological, 

8 and medical sciences. 

9 ‘‘(4) DISCLOSURE OF ALLOCATIONS.—The Sec10 retary shall, upon making a certification under this 

11 subsection, publicly disclose the identity of the appli12 cant and the amount of the credit with respect to 

13 such applicant. 

14 ‘‘(e) SPECIAL RULES.— 

15 ‘‘(1) BASIS ADJUSTMENT.—For purposes of 

16 this subtitle, if a credit is allowed under this section 

17 for an expenditure related to property of a character 

18 subject to an allowance for depreciation, the basis of 

19 such property shall be reduced by the amount of 

20 such credit. 

21 ‘‘(2) DENIAL OF DOUBLE BENEFIT.— 

22 ‘‘(A) BONUS DEPRECIATION.—A credit 

23 shall not be allowed under this section for any 

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1 lowed under section 168(k), 1400L(b)(1), or 

2 1400N(d)(1). 

3 ‘‘(B) DEDUCTIONS.—No deduction under 

4 this subtitle shall be allowed for the portion of 

5 the expenses otherwise allowable as a deduction 

6 taken into account in determining the credit 

7 under this section for the taxable year which is 

8 equal to the amount of the credit determined 

9 for such taxable year under subsection (a) at10 tributable to such portion. This subparagraph 

11 shall not apply to expenses related to property 

12 of a character subject to an allowance for de13 preciation the basis of which is reduced under 

14 paragraph (1), or which are described in section 

15 280C(g). 

16 ‘‘(C) CREDIT FOR RESEARCH ACTIVI17 TIES.— 

18 ‘‘(i) IN GENERAL.—Except as pro19 vided in clause (ii), any expenses taken 

20 into account under this section for a tax21 able year shall not be taken into account 

22 for purposes of determining the credit al23 lowable under section 41 or 45C for such 

24 taxable year. 


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1 ‘‘(ii) EXPENSES INCLUDED IN DETER2 MINING BASE PERIOD RESEARCH EX3 PENSES.—Any expenses for any taxable 

4 year which are qualified research expenses 

5 (within the meaning of section 41(b)) shall 

6 be taken into account in determining base 

7 period research expenses for purposes of 

8 applying section 41 to subsequent taxable 

9 years. 

10 ‘‘(f) COORDINATION WITH DEPARTMENT OF TREAS11 URY GRANTS.—In the case of any investment with respect 

12 to which the Secretary makes a grant under section 

13 9023(e) of the Patient Protection and Affordable Care Act 

14 of 2009— 

15 ‘‘(1) DENIAL OF CREDIT.—No credit shall be 

16 determined under this section with respect to such 

17 investment for the taxable year in which such grant 

18 is made or any subsequent taxable year. 

19 ‘‘(2) RECAPTURE OF CREDITS FOR PROGRESS

20 EXPENDITURES MADE BEFORE GRANT.—If a credit 

21 was determined under this section with respect to 

22 such investment for any taxable year ending before 

23 such grant is made— 

24 ‘‘(A) the tax imposed under subtitle A on 

25 the taxpayer for the taxable year in which such 


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1 grant is made shall be increased by so much of 

2 such credit as was allowed under section 38, 

3 ‘‘(B) the general business carryforwards 

4 under section 39 shall be adjusted so as to re5 capture the portion of such credit which was 

6 not so allowed, and 

7 ‘‘(C) the amount of such grant shall be de8 termined without regard to any reduction in the 

9 basis of any property of a character subject to 

10 an allowance for depreciation by reason of such 

11 credit. 

12 ‘‘(3) TREATMENT OF GRANTS.—Any such grant 

13 shall not be includible in the gross income of the 

14 taxpayer.’’. 

15 (b) INCLUSION AS PART OF INVESTMENT CREDIT.— 

16 Section 46 of the Internal Revenue Code of 1986 is 

17 amended— 

18 (1) by adding a comma at the end of paragraph 

19 (2), 

20 (2) by striking the period at the end of para21 graph (5) and inserting ‘‘, and’’, and 

22 (3) by adding at the end the following new 

23 paragraph: 

24 ‘‘(6) the qualifying therapeutic discovery project 

25 credit.’’. 


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1 (c) CONFORMING AMENDMENTS.— 

2 (1) Section 49(a)(1)(C) of the Internal Revenue 

3 Code of 1986 is amended— 

4 (A) by striking ‘‘and’’ at the end of clause 

5 (iv), 

6 (B) by striking the period at the end of 

7 clause (v) and inserting ‘‘, and’’, and 

8 (C) by adding at the end the following new 

9 clause: 

10 ‘‘(vi) the basis of any property to 

11 which paragraph (1) of section 48D(e) ap12 plies which is part of a qualifying thera13 peutic discovery project under such section 

14 48D.’’. 

15 (2) Section 280C of such Code is amended by 

16 adding at the end the following new subsection: 

17 ‘‘(g) QUALIFYING THERAPEUTIC DISCOVERY

18 PROJECT CREDIT.— 

19 ‘‘(1) IN GENERAL.—No deduction shall be al20 lowed for that portion of the qualified investment (as 

21 defined in section 48D(b)) otherwise allowable as a 

22 deduction for the taxable year which— 

23 ‘‘(A) would be qualified research expenses 

24 (as defined in section 41(b)), basic research ex25 penses (as defined in section 41(e)(2)), or qualiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 02067 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 fied clinical testing expenses (as defined in sec2 tion 45C(b)) if the credit under section 41 or 

3 section 45C were allowed with respect to such 

4 expenses for such taxable year, and 

5 ‘‘(B) is equal to the amount of the credit 

6 determined for such taxable year under section 

7 48D(a), reduced by— 

8 ‘‘(i) the amount disallowed as a de9 duction by reason of section 48D(e)(2)(B), 

10 and 

11 ‘‘(ii) the amount of any basis reduc12 tion under section 48D(e)(1). 

13 ‘‘(2) SIMILAR RULE WHERE TAXPAYER CAP14 ITALIZES RATHER THAN DEDUCTS EXPENSES.—In 

15 the case of expenses described in paragraph (1)(A) 

16 taken into account in determining the credit under 

17 section 48D for the taxable year, if— 

18 ‘‘(A) the amount of the portion of the 

19 credit determined under such section with re20 spect to such expenses, exceeds 

21 ‘‘(B) the amount allowable as a deduction 

22 for such taxable year for such expenses (deter23 mined without regard to paragraph (1)), 


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1 the amount chargeable to capital account for the 

2 taxable year for such expenses shall be reduced by 

3 the amount of such excess. 

4 ‘‘(3) CONTROLLED GROUPS.—Paragraph (3) of 

5 subsection (b) shall apply for purposes of this sub6 section.’’. 

7 (d) CLERICAL AMENDMENT.—The table of sections 

8 for subpart E of part IV of subchapter A of chapter 1 

9 of the Internal Revenue Code of 1986 is amended by in10 serting after the item relating to section 48C the following 

11 new item: 

‘‘Sec. 48D. Qualifying therapeutic discovery project credit.’’. 

12 (e) GRANTS FOR QUALIFIED INVESTMENTS IN

13 THERAPEUTIC DISCOVERY PROJECTS IN LIEU OF TAX

14 CREDITS.— 

15 (1) IN GENERAL.—Upon application, the Sec16 retary of the Treasury shall, subject to the require17 ments of this subsection, provide a grant to each 

18 person who makes a qualified investment in a quali19 fying therapeutic discovery project in the amount of 

20 50 percent of such investment. No grant shall be 

21 made under this subsection with respect to any in22 vestment unless such investment is made during a 

23 taxable year beginning in 2009 or 2010. 

24 (2) APPLICATION.— 


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1 (A) IN GENERAL.—At the stated election 

2 of the applicant, an application for certification 

3 under section 48D(d)(2) of the Internal Rev4 enue Code of 1986 for a credit under such sec5 tion for the taxable year of the applicant which 

6 begins in 2009 shall be considered to be an ap7 plication for a grant under paragraph (1) for 

8 such taxable year. 

9 (B) TAXABLE YEARS BEGINNING IN

10 2010.—An application for a grant under para11 graph (1) for a taxable year beginning in 2010 

12 shall be submitted— 

13 (i) not earlier than the day after the 

14 last day of such taxable year, and 

15 (ii) not later than the due date (in16 cluding extensions) for filing the return of 

17 tax for such taxable year. 

18 (C) INFORMATION TO BE SUBMITTED.—An 

19 application for a grant under paragraph (1) 

20 shall include such information and be in such 

21 form as the Secretary may require to state the 

22 amount of the credit allowable (but for the re23 ceipt of a grant under this subsection) under 

24 section 48D for the taxable year for the qualiVerDate Nov 24 2008 00:00 Nov 20, 2009 Jkt 089200 PO 00000 Frm 02070 Fmt 6654 Sfmt 6201 E:\BILLS\H3590.AS H3590

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1 fied investment with respect to which such ap2 plication is made. 

3 (3) TIME FOR PAYMENT OF GRANT.— 

4 (A) IN GENERAL.—The Secretary of the 

5 Treasury shall make payment of the amount of 

6 any grant under paragraph (1) during the 30- 

7 day period beginning on the later of— 

8 (i) the date of the application for such 

9 grant, or 

10 (ii) the date the qualified investment 

11 for which the grant is being made is made. 

12 (B) REGULATIONS.—In the case of invest13 ments of an ongoing nature, the Secretary shall 

14 issue regulations to determine the date on 

15 which a qualified investment shall be deemed to 

16 have been made for purposes of this paragraph. 

17 (4) QUALIFIED INVESTMENT.—For purposes of 

18 this subsection, the term ‘‘qualified investment’’ 

19 means a qualified investment that is certified under 

20 section 48D(d) of the Internal Revenue Code of 

21 1986 for purposes of the credit under such section 

22 48D. 

23 (5) APPLICATION OF CERTAIN RULES.— 

24 (A) IN GENERAL.—In making grants 

25 under this subsection, the Secretary of the 


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1 Treasury shall apply rules similar to the rules 

2 of section 50 of the Internal Revenue Code of 

3 1986. In applying such rules, any increase in 

4 tax under chapter 1 of such Code by reason of 

5 an investment ceasing to be a qualified invest6 ment shall be imposed on the person to whom 

7 the grant was made. 

8 (B) SPECIAL RULES.— 

9 (i) RECAPTURE OF EXCESSIVE GRANT

10 AMOUNTS.—If the amount of a grant made 

11 under this subsection exceeds the amount 

12 allowable as a grant under this subsection, 

13 such excess shall be recaptured under sub14 paragraph (A) as if the investment to 

15 which such excess portion of the grant re16 lates had ceased to be a qualified invest17 ment immediately after such grant was 

18 made. 

19 (ii) GRANT INFORMATION NOT TREAT20 ED AS RETURN INFORMATION.—In no 

21 event shall the amount of a grant made 

22 under paragraph (1), the identity of the 

23 person to whom such grant was made, or 

24 a description of the investment with re25 spect to which such grant was made be 


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•AMDT. NO. 2786 

1 treated as return information for purposes 

2 of section 6103 of the Internal Revenue 

3 Code of 1986. 

4 (6) EXCEPTION FOR CERTAIN NON-TAX5 PAYERS.—The Secretary of the Treasury shall not 

6 make any grant under this subsection to— 

7 (A) any Federal, State, or local govern8 ment (or any political subdivision, agency, or 

9 instrumentality thereof), 

10 (B) any organization described in section 

11 501(c) of the Internal Revenue Code of 1986 

12 and exempt from tax under section 501(a) of 

13 such Code, 

14 (C) any entity referred to in paragraph (4) 

15 of section 54(j) of such Code, or 

16 (D) any partnership or other pass-thru en17 tity any partner (or other holder of an equity 

18 or profits interest) of which is described in sub19 paragraph (A), (B) or (C). 

20 In the case of a partnership or other pass-thru enti21 ty described in subparagraph (D), partners and 

22 other holders of any equity or profits interest shall 

23 provide to such partnership or entity such informa24 tion as the Secretary of the Treasury may require to 

25 carry out the purposes of this paragraph. 


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1 (7) SECRETARY.—Any reference in this sub2 section to the Secretary of the Treasury shall be 

3 treated as including the Secretary’s delegate. 

4 (8) OTHER TERMS.—Any term used in this sub5 section which is also used in section 48D of the In6 ternal Revenue Code of 1986 shall have the same 

7 meaning for purposes of this subsection as when 

8 used in such section. 

9 (9) DENIAL OF DOUBLE BENEFIT.—No credit 

10 shall be allowed under section 46(6) of the Internal 

11 Revenue Code of 1986 by reason of section 48D of 

12 such Code for any investment for which a grant is 

13 awarded under this subsection. 

14 (10) APPROPRIATIONS.—There is hereby appro15 priated to the Secretary of the Treasury such sums 

16 as may be necessary to carry out this subsection. 

17 (11) TERMINATION.—The Secretary of the 

18 Treasury shall not make any grant to any person 

19 under this subsection unless the application of such 

20 person for such grant is received before January 1, 

21 2013. 

22 (f) EFFECTIVE DATE.—The amendments made by 

23 subsections (a) through (d) of this section shall apply to 

24 amounts paid or incurred after December 31, 2008, in 

25 taxable years beginning after such date. 


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Amendment No. 2786 

H.R. 3590 


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