II 

Calendar No. 252 

111TH CONGRESS 

2D SESSION H. R. 3961 

IN THE SENATE OF THE UNITED STATES 

NOVEMBER 20, 2009 

Received 

DECEMBER 24, 2009 

Read the first time 

JANUARY 20, 2010 

Read the second time and placed on the calendar 

AN ACT 

To amend title XVIII of the Social Security Act to reform 

the Medicare SGR payment system for physicians and 

to reinstitute and update the Pay-As-You-Go requirement 

of budget neutrality on new tax and mandatory spending 

legislation, enforced by the threat of annual, automatic 

sequestration. 


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

3 DIVISION A—MEDICARE PHYSI4 CIAN PAYMENT REFORM ACT 

5 OF 2009 

6 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

7 (a) SHORT TITLE.—This division may be cited as the 

8 ‘‘Medicare Physician Payment Reform Act of 2009’’. 

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

10 this Act is as follows: 

DIVISION A—MEDICARE PHYSICIAN PAYMENT REFORM ACT OF 

2009 

Sec. 1. Short title; table of contents. 

Sec. 2. Medicare sustainable growth rate reform. 

DIVISION B—STATUTORY PAY-AS-YOU-GO ACT OF 2009 

Sec. 101. Short Title. 

Sec. 102. Purpose. 

Sec. 103. Definitions. 

Sec. 104. PAYGO estimates and PAYGO scorecards. 

Sec. 105. Annual report and sequestration order. 

Sec. 106. Calculating a sequestration. 

Sec. 107. Current policy adjustment to the CBO estimates. 

Sec. 108. Application of BBEDCA. 

Sec. 109. Technical corrections. 

Sec. 110. Conforming amendments. 

Sec. 111. Exempt programs and activities. 

11 SEC. 2. MEDICARE SUSTAINABLE GROWTH RATE REFORM. 

12 (a) TRANSITIONAL UPDATE FOR 2010.—Section 

13 1848(d) of the Social Security Act (42 U.S.C. 1395w– 

14 4(d)) is amended by adding at the end the following new 

15 paragraph: 

16 ‘‘(10) UPDATE FOR 2010.—The update to the 

17 single conversion factor established in paragraph 


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1 (1)(C) for 2010 shall be the percentage increase in 

2 the MEI (as defined in section 1842(i)(3)) for that 

3 year.’’. 

4 (b) REBASING SGR USING 2009; LIMITATION ON

5 CUMULATIVE ADJUSTMENT PERIOD.—Section 1848(d)(4) 

6 of such Act (42 U.S.C. 1395w–4(d)(4)) is amended— 

7 (1) in subparagraph (B), by striking ‘‘subpara8 graph (D)’’ and inserting ‘‘subparagraphs (D) and 

9 (G)’’; and 

10 (2) by adding at the end the following new sub11 paragraph: 

12 ‘‘(G) REBASING USING 2009 FOR FUTURE

13 UPDATE ADJUSTMENTS.—In determining the 

14 update adjustment factor under subparagraph 

15 (B) for 2011 and subsequent years— 

16 ‘‘(i) the allowed expenditures for 2009 

17 shall be equal to the amount of the actual 

18 expenditures for physicians’ services during 

19 2009; and 

20 ‘‘(ii) the reference in subparagraph 

21 (B)(ii)(I) to ‘April 1, 1996’ shall be treat22 ed as a reference to ‘January 1, 2009 (or, 

23 if later, the first day of the fifth year be24 fore the year involved)’.’’. 


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1 (c) LIMITATION ON PHYSICIANS’ SERVICES IN2 CLUDED IN TARGET GROWTH RATE COMPUTATION TO

3 SERVICES COVERED UNDER PHYSICIAN FEE SCHED4 ULE.—Effective for services furnished on or after January 

5 1, 2009, section 1848(f)(4)(A) of such Act is amended by 

6 striking ‘‘(such as clinical’’ and all that follows through 

7 ‘‘in a physician’s office’’ and inserting ‘‘for which payment 

8 under this part is made under the fee schedule under this 

9 section, for services for practitioners described in section 

10 1842(b)(18)(C) on a basis related to such fee schedule, 

11 or for services described in section 1861(p) (other than 

12 such services when furnished in the facility of a provider 

13 of services)’’. 

14 (d) ESTABLISHMENT OF SEPARATE TARGET

15 GROWTH RATES FOR CATEGORIES OF SERVICES.— 

16 (1) ESTABLISHMENT OF SERVICE CAT17 EGORIES.—Subsection (j) of section 1848 of the So18 cial Security Act (42 U.S.C. 1395w–4) is amended 

19 by adding at the end the following new paragraph: 

20 ‘‘(5) SERVICE CATEGORIES.—For services fur21 nished on or after January 1, 2009, each of the fol22 lowing categories of physicians’ services (as defined 

23 in paragraph (3)) shall be treated as a separate 

24 ‘service category’: 


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1 ‘‘(A) Evaluation and management services 

2 that are procedure codes (for services covered 

3 under this title) for— 

4 ‘‘(i) services in the category des5 ignated Evaluation and Management in the 

6 Health Care Common Procedure Coding 

7 System (established by the Secretary under 

8 subsection (c)(5) as of December 31, 2009, 

9 and as subsequently modified by the Sec10 retary); and 

11 ‘‘(ii) preventive services (as defined in 

12 section 1861(iii)) for which payment is 

13 made under this section. 

14 ‘‘(B) All other services not described in 

15 subparagraph (A). 

16 Service categories established under this paragraph 

17 shall apply without regard to the specialty of the 

18 physician furnishing the service.’’. 

19 (2) ESTABLISHMENT OF SEPARATE CONVER20 SION FACTORS FOR EACH SERVICE CATEGORY.— 

21 Subsection (d)(1) of section 1848 of the Social Secu22 rity Act (42 U.S.C. 1395w–4) is amended— 

23 (A) in subparagraph (A)— 

24 (i) by designating the sentence begin25 ning ‘‘The conversion factor’’ as clause (i) 


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1 with the heading ‘‘APPLICATION OF SIN2 GLE CONVERSION FACTOR.—’’ and with 

3 appropriate indentation; 

4 (ii) by striking ‘‘The conversion fac5 tor’’ and inserting ‘‘Subject to clause (ii), 

6 the conversion factor’’; and 

7 (iii) by adding at the end the fol8 lowing new clause: 

9 ‘‘(ii) APPLICATION OF MULTIPLE CON10 VERSION FACTORS BEGINNING WITH

11 2011.— 

12 ‘‘(I) IN GENERAL.—In applying 

13 clause (i) for years beginning with 

14 2011, separate conversion factors 

15 shall be established for each service 

16 category of physicians’ services (as de17 fined in subsection (j)(5)) and any 

18 reference in this section to a conver19 sion factor for such years shall be 

20 deemed to be a reference to the con21 version factor for each of such cat22 egories. 

23 ‘‘(II) INITIAL CONVERSION FAC24 TORS.—Such factors for 2011 shall be 

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1 tor for the previous year multiplied by 

2 the update established under para3 graph (11) for such category for 

4 2011. 

5 ‘‘(III) UPDATING OF CONVER6 SION FACTORS.—Such factor for a 

7 service category for a subsequent year 

8 shall be based upon the conversion 

9 factor for such category for the pre10 vious year and adjusted by the update 

11 established for such category under 

12 paragraph (11) for the year in13 volved.’’; and 

14 (B) in subparagraph (D), by striking 

15 ‘‘other physicians’ services’’ and inserting ‘‘for 

16 physicians’ services described in the service cat17 egory described in subsection (j)(5)(B)’’. 

18 (3) ESTABLISHING UPDATES FOR CONVERSION

19 FACTORS FOR SERVICE CATEGORIES.—Section 

20 1848(d) of the Social Security Act (42 U.S.C. 

21 1395w–4(d)), as amended by subsection (a), is 

22 amended— 

23 (A) in paragraph (4)(C)(iii), by striking 

24 ‘‘The allowed’’ and inserting ‘‘Subject to para25 graph (11)(B), the allowed’’; and 


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

2 paragraph: 

3 ‘‘(11) UPDATES FOR SERVICE CATEGORIES BE4 GINNING WITH 2011.— 

5 ‘‘(A) IN GENERAL.—In applying paragraph 

6 (4) for a year beginning with 2011, the fol7 lowing rules apply: 

8 ‘‘(i) APPLICATION OF SEPARATE UP9 DATE ADJUSTMENTS FOR EACH SERVICE

10 CATEGORY.—Pursuant to paragraph 

11 (1)(A)(ii)(I), the update shall be made to 

12 the conversion factor for each service cat13 egory (as defined in subsection (j)(5)) 

14 based upon an update adjustment factor 

15 for the respective category and year and 

16 the update adjustment factor shall be com17 puted, for a year, separately for each serv18 ice category. 

19 ‘‘(ii) COMPUTATION OF ALLOWED AND

20 ACTUAL EXPENDITURES BASED ON SERV21 ICE CATEGORIES.—In computing the prior 

22 year adjustment component and the cumu23 lative adjustment component under clauses 

24 (i) and (ii) of paragraph (4)(B), the fol25 lowing rules apply: 


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1 ‘‘(I) APPLICATION BASED ON

2 SERVICE CATEGORIES.—The allowed 

3 expenditures and actual expenditures 

4 shall be the allowed and actual ex5 penditures for the service category, as 

6 determined under subparagraph (B). 

7 ‘‘(II) APPLICATION OF CATEGORY

8 SPECIFIC TARGET GROWTH RATE.— 

9 The growth rate applied under clause 

10 (ii)(II) of such paragraph shall be the 

11 target growth rate for the service cat12 egory involved under subsection (f)(5). 

13 ‘‘(B) DETERMINATION OF ALLOWED EX14 PENDITURES.—In applying paragraph (4) for a 

15 year beginning with 2010, notwithstanding sub16 paragraph (C)(iii) of such paragraph, the al17 lowed expenditures for a service category for a 

18 year is an amount computed by the Secretary 

19 as follows: 

20 ‘‘(i) FOR 2010.—For 2010: 

21 ‘‘(I) TOTAL 2009 ACTUAL EX22 PENDITURES FOR ALL SERVICES IN23 CLUDED IN SGR COMPUTATION FOR

24 EACH SERVICE CATEGORY.—Compute 

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1 cians’ services (as defined in sub2 section (f)(4)(A)) for 2009 for each 

3 service category. 

4 ‘‘(II) INCREASE BY GROWTH

5 RATE TO OBTAIN 2010 ALLOWED EX6 PENDITURES FOR SERVICE CAT7 EGORY.—Compute allowed expendi8 tures for the service category for 2010 

9 by increasing the allowed expenditures 

10 for the service category for 2009 com11 puted under subclause (I) by the tar12 get growth rate for such service cat13 egory under subsection (f) for 2010. 

14 ‘‘(ii) FOR SUBSEQUENT YEARS.—For 

15 a subsequent year, take the amount of al16 lowed expenditures for such category for 

17 the preceding year (under clause (i) or this 

18 clause) and increase it by the target 

19 growth rate determined under subsection 

20 (f) for such category and year.’’. 

21 (4) APPLICATION OF SEPARATE TARGET

22 GROWTH RATES FOR EACH CATEGORY.— 

23 (A) IN GENERAL.—Section 1848(f) of the 

24 Social Security Act (42 U.S.C. 1395w–4(f)) is 


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1 amended by adding at the end the following 

2 new paragraph: 

3 ‘‘(5) APPLICATION OF SEPARATE TARGET

4 GROWTH RATES FOR EACH SERVICE CATEGORY BE5 GINNING WITH 2010.—The target growth rate for a 

6 year beginning with 2010 shall be computed and ap7 plied separately under this subsection for each serv8 ice category (as defined in subsection (j)(5)) and 

9 shall be computed using the same method for com10 puting the target growth rate except that the factor 

11 described in paragraph (2)(C) for— 

12 ‘‘(A) the service category described in sub13 section (j)(5)(A) shall be increased by 0.02; and 

14 ‘‘(B) the service category described in sub15 section (j)(5)(B) shall be increased by 0.01.’’. 

16 (B) USE OF TARGET GROWTH RATES.— 

17 Section 1848 of such Act is further amended— 

18 (i) in subsection (d)— 

19 (I) in paragraph (1)(E)(ii), by in20 serting ‘‘or target’’ after ‘‘sustain21 able’’; and 

22 (II) in paragraph (4)(B)(ii)(II), 

23 by inserting ‘‘or target’’ after ‘‘sus24 tainable’’; 


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1 (ii) in the heading of subsection (f), 

2 by inserting ‘‘AND TARGET GROWTH

3 RATE’’ after ‘‘SUSTAINABLE GROWTH

4 RATE’’; 

5 (iii) in subsection (f)(1)— 

6 (I) by striking ‘‘and’’ at the end 

7 of subparagraph (A); 

8 (II) in subparagraph (B), by in9 serting ‘‘before 2010’’ after ‘‘each 

10 succeeding year’’ and by striking the 

11 period at the end and inserting ‘‘; 

12 and’’; and 

13 (III) by adding at the end the 

14 following new subparagraph: 

15 ‘‘(C) November 1 of each succeeding year 

16 the target growth rate for such succeeding year 

17 and each of the 2 preceding years.’’; and 

18 (iv) in subsection (f)(2), in the matter 

19 before subparagraph (A), by inserting after 

20 ‘‘beginning with 2000’’ the following: ‘‘and 

21 ending with 2009’’. 

22 (e) APPLICATION TO HEALTH CARE GROUP DEM23 ONSTRATION PROGRAM AND SUCCESSOR ACCOUNTABLE

24 CARE ORGANIZATION PILOT PROGRAM.—In applying the 

25 target growth rate under subsections (d) and (f) of section 


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1 1848 of the Social Security Act to services furnished by 

2 a practitioner to beneficiaries who are attributable to a 

3 health care group under the demonstration program pro4 vided under section 1886A of such Act (or to an account5 able care organization under a pilot program that is a 

6 succcessor to such demonstration program under a section 

7 of such Act), the Secretary of Health and Human Services 

8 shall develop, not later than January 1, 2012, for applica9 tion beginning with 2012, a method that— 

10 (1) allows each such group or organization to 

11 have its own expenditure targets and updates for 

12 such practitioners, with respect to beneficiaries who 

13 are attributable to that group or organization, that 

14 are consistent with the methodologies described in 

15 such subsection (f); and 

16 (2) provides that the target growth rate appli17 cable to other physicians shall not apply to such 

18 physicians to the extent that the physicians’ services 

19 are furnished through the group or organization. 

20 In applying paragraph (1), the Secretary of Health and 

21 Human Services may apply the difference in the update 

22 under such paragraph on a claim-by-claim or lump sum 

23 basis and such a payment shall be taken into account 

24 under the demonstration or pilot program. 


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1 DIVISION B—STATUTORY PAY2 AS-YOU-GO ACT OF 2009 

3 SEC. 101. SHORT TITLE. 

4 This division may be cited as the ‘‘Statutory Pay-As5 You-Go Act of 2009’’. 

6 SEC. 102. PURPOSE. 

7 The purpose of this division is to reestablish a statu8 tory procedure to enforce a rule of budget neutrality on 

9 new revenue and direct spending legislation. 

10 SEC. 103. DEFINITIONS. 

11 As used in this division— 

12 (1) The term ‘‘BBEDCA’’ means the Balanced 

13 Budget and Emergency Deficit Control Act of 1985. 

14 (2) The definitions set forth in section 3 of the 

15 Congressional Budget and Impoundment Control 

16 Act of 1974 and in section 250 of BBEDCA shall 

17 apply to this division, except to the extent that they 

18 are specifically modified as follows: 

19 (A) The term ‘‘outyear’’ means a fiscal 

20 year that occurs one or more years after the 

21 budget year. 

22 (B) In section 250(c)(8)(C), the reference 

23 to the food stamp program shall be deemed to 

24 be a reference to the Supplemental Nutrition 

25 Assistance Program. 


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1 (3) The term ‘‘AMT’’ means the Alternative 

2 Minimum Tax for individuals under sections 55–59 

3 of the Internal Revenue Code of 1986, the term 

4 ‘‘EGTRRA’’ means the Economic Growth and Tax 

5 Relief Reconciliation Act of 2001 (Public Law 107– 

6 16), and the term ‘‘JGTRRA’’ means the Jobs and 

7 Growth Tax Relief and Reconciliation Act of 2003 

8 (Public Law 108–27). 

9 (4)(A) The term ‘‘budgetary effects’’ means the 

10 amounts by which PAYGO legislation changes direct 

11 spending or revenues relative to the baseline and 

12 shall be determined on the basis of estimates in13 cluded by reference in the PAYGO Act or prepared 

14 under section 104(d)(3), as applicable. Budgetary 

15 effects that increase direct spending or decrease rev16 enues are termed ‘‘costs’’ and budgetary effects that 

17 increase revenues or decrease direct spending are 

18 termed ‘‘savings’’. 

19 (B) For purposes of these definitions, off-budg20 et effects shall be counted as budgetary effects un21 less such changes flow directly from amendments to 

22 title II of the Social Security Act and related provi23 sions of the Internal Revenue Code of 1986 and debt 

24 service effects shall not be counted as budgetary ef25 fects. 


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1 (C) Solely for purposes of recording entries on 

2 a PAYGO scorecard, provisions in appropriations 

3 Acts are also considered to be budgetary effects for 

4 purposes of this division if such provisions make out5 year modifications to substantive law, except that 

6 provisions for which the outlay effects net to zero 

7 over a period consisting of the current year, the 

8 budget year, and the 4 subsequent years shall not be 

9 considered budgetary effects. For purposes of this 

10 paragraph, the term, ‘‘modifications to substantive 

11 law’’ refers to changes to or restrictions on entitle12 ment law or other mandatory spending contained in 

13 appropriations Acts, notwithstanding section 

14 250(c)(8) of BBEDCA. Provisions in appropriations 

15 Acts that are neither outyear modifications to sub16 stantive law nor changes in revenues have no budg17 etary effects for purposes of this division. 

18 (D) If a provision is designated as an emer19 gency requirement under this division and is also 

20 designated as an emergency requirement under the 

21 applicable rules of the House of Representatives, 

22 CBO shall not include the cost of such a provision 

23 in its estimate of the PAYGO legislation’s budgetary 

24 effects. 


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1 (5) The term ‘‘debit’’ refers to the net total 

2 amount, when positive, by which costs recorded on 

3 the PAYGO scorecards for a fiscal year exceed sav4 ings recorded on those scorecards for that year. 

5 (6) The term ‘‘entitlement law’’ refers to a sec6 tion of law which provides entitlement authority. 

7 (7) The term ‘‘PAYGO legislation’’ or a 

8 ‘‘PAYGO Act’’ refers to a bill or joint resolution 

9 that affects direct spending or revenue relative to 

10 the baseline. The budgetary effects of changes in 

11 revenues and outyear modifications to substantive 

12 law included in appropriation Acts as defined in 

13 paragraph (4) shall be treated as if they were con14 tained in PAYGO legislation. 

15 (8) The term ‘‘timing shift’’ refers to a delay of 

16 the date on which direct spending would otherwise 

17 occur from the ninth outyear to the tenth outyear or 

18 an acceleration of the date on which revenues would 

19 otherwise occur from the tenth outyear to the ninth 

20 outyear. 

21 SEC. 104. PAYGO ESTIMATES AND PAYGO SCORECARDS. 

22 (a) PAYGO ESTIMATES.—(1) A PAYGO Act shall in23 clude by reference an estimate of its budgetary effects as 

24 determined under section 308(a)(3) of the Congressional 

25 Budget Act of 1974, if timely submitted for printing in 


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1 the Congressional Record by the chairs of the Committees 

2 on the Budget of the House of Representatives and the 

3 Senate, as applicable, before the vote on the PAYGO legis4 lation. The Clerk of the House or the Secretary of the 

5 Senate, as applicable, shall also incorporate by reference 

6 such estimate printed in the relevant portion of the Con7 gressional Record under section 308(a)(3) of the Congres8 sional Budget Act of 1974 into the enrollment of a 

9 PAYGO Act. Budgetary effects that are not so included 

10 shall be determined under section 104(d)(3). 

11 (2)(A) Section 308(a) of the Congressional Budget 

12 Act of 1974 is amended by adding at the end the following 

13 new paragraph: 

14 ‘‘(3) CBO PAYGO ESTIMATES.—Before a vote in 

15 either House on a PAYGO Act that, if determined 

16 in the affirmative, would clear such Act for enroll17 ment, the chairs of the Committees on the Budget 

18 of the House and Senate, as applicable, shall request 

19 from the Director of the Congressional Budget Of20 fice an estimate of the budgetary effects of such Act 

21 under the Statutory Pay-As-You-Go Act of 2009. If 

22 such an estimate is timely provided, the chairs of the 

23 Committees on the Budget of the House of Rep24 resentatives and the Senate shall post such estimate 

25 on their respective committee websites and cause it 


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1 to be printed in the Congressional Record under the 

2 heading ‘PAYGO ESTIMATE’. For purposes of this 

3 section, the Director of the Congressional Budget 

4 Office shall not count timing shifts in his estimates 

5 of the budgetary effects of PAYGO legislation (as 

6 defined in section 103 of the Statutory Pay-As-You7 Go Act of 2009).’’. 

8 (B) The side heading of section 308(a) of the Con9 gressional Budget Act of 1974 is amended by striking 

10 ‘‘REPORTS ON’’. 

11 (b) Section 308 of the Congressional Budget Act of 

12 1974 is amended by adding at the end the following new 

13 subsection: 

14 ‘‘(d) SCOREKEEPING GUIDELINES.—The Director of 

15 the Congressional Budget Office shall provide estimates 

16 under this section in accordance with the scorekeeping 

17 guidelines determined under section 252(d)(5) of the Bal18 anced Budget and Emergency Deficit Control Act of 1985. 

19 Upon agreement, the chairs of the Committees on the 

20 Budget of the House of Representatives and the Senate 

21 shall submit updates to such guidelines for printing in the 

22 Congressional Record.’’. 

23 (c) CURRENT POLICY ADJUSTMENTS FOR CERTAIN

24 LEGISLATION.—For purposes of calculating budgetary ef25 fects under this division, CBO shall adjust its estimates 


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1 as described below for any provision of legislation des2 ignated as meeting the criteria in subsection (b), (c), or 

3 (d) of section 107 and which the chairman of the Com4 mittee on the Budget of the House of Representatives or 

5 the Senate, as applicable, designates as meeting those cri6 teria. A single piece of legislation may contain provisions 

7 designated as meeting criteria in more than one of the 

8 subsections listed above. For appropriately designated pro9 visions, CBO shall exclude from its estimates for purposes 

10 of this division any costs of a provision to the extent that 

11 those costs, when combined with all other excluded costs 

12 of any other previously designated provisions of enacted 

13 legislation under the same subsection of section 107, do 

14 not exceed the maximum applicable current policy adjust15 ment defined under the applicable subsection of section 

16 107 for the applicable 10-year period, using the most re17 cent baseline estimates supplied by the Congressional 

18 Budget Office consistent with section 257 of the Balanced 

19 Budget and Emergency Deficit Control Act of 1985 used 

20 in considering a concurrent resolution on the budget; or, 

21 after the beginning of a new calendar year and before con22 sideration of a concurrent resolution on the budget, using 

23 the most recent baseline estimates supplied by the Con24 gressional Budget Office consistent with section 257 of the 

25 Balanced Budget and Emergency Deficit Control Act of 


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1 1985. CBO estimates of legislation containing a current 

2 policy designation under this subsection shall include a 

3 separate presentation of costs excluded from the calcula4 tion of budgetary effects for the legislation, as well as an 

5 updated total of all excluded costs of provisions within the 

6 same subsection of section 107. 

7 (d) OMB PAYGO SCORECARDS.— 

8 (1) IN GENERAL.—OMB shall maintain and 

9 make publicly available a continuously updated docu10 ment containing two PAYGO scorecards displaying 

11 the budgetary effects of PAYGO legislation as deter12 mined under section 308 of the Congressional Budg13 et Act of 1974, applying the look-back requirement 

14 in subsection (e) and the averaging requirement in 

15 subsection (f), and a separate addendum displaying 

16 the estimates of the costs of provisions designated in 

17 statute as emergency requirements. 

18 (2) ESTIMATES IN LEGISLATION.—Except as 

19 provided in paragraph (3), in making the calcula20 tions for the PAYGO scorecards, OMB shall use the 

21 budgetary effects included by reference in the appli22 cable legislation. 

23 (3) OMB ESTIMATES.—If legislation does not 

24 contain the estimate of budgetary effects under 

25 paragraph (2), then OMB shall score the budgetary 


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1 effects of that legislation upon its enactment, based 

2 on the approaches to scorekeeping set forth in this 

3 division. 

4 (4) 5-YEAR SCORECARD.—The first scorecard 

5 shall display the budgetary effects of PAYGO legis6 lation in each year over the 5-year period beginning 

7 in the budget year. 

8 (5) 10-YEAR SCORECARD.—The second score9 card shall display the budgetary effects of PAYGO 

10 legislation in each year over the 10-year period be11 ginning in the budget year. 

12 (e) LOOK-BACK TO CAPTURE CURRENT-YEAR EF13 FECTS.—For purposes of this section, OMB shall treat the 

14 budgetary effects of PAYGO legislation enacted during a 

15 session of Congress that occur during the current year as 

16 though they occurred in the budget year. 

17 (f) AVERAGING USED TO MEASURE COMPLIANCE

18 OVER 5-YEAR AND 10-YEAR PERIODS.—OMB shall cumu19 late the budgetary effects of a PAYGO Act over the budg20 et year (which includes any look-back effects under sub21 section (e)) and— 

22 (1) for purposes of the 5-year scorecard re23 ferred to in subsection (d)(4), the four subsequent 

24 outyears, divide that cumulative total by five, and 

25 enter the quotient in the budget-year column and in 


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1 each subsequent column of the 5-year PAYGO score2 card; and 

3 (2) for purposes of the 10-year scorecard re4 ferred to in subsection (d)(5), the nine subsequent 

5 outyears, divide that cumulative total by ten, and 

6 enter the quotient in the budget-year column and in 

7 each subsequent column of the 10-year PAYGO 

8 scorecard. 

9 SEC. 105. ANNUAL REPORT AND SEQUESTRATION ORDER. 

10 (a) ANNUAL REPORT.—Not later than 14 days (ex11 cluding weekends and holidays) after Congress adjourns 

12 to end a session, OMB shall make publicly available and 

13 cause to be printed in the Federal Register an annual 

14 PAYGO report. The report shall include an up-to-date 

15 document containing the PAYGO scorecards, a description 

16 of any current policy adjustments made under section 

17 104(c), information about emergency legislation (if any) 

18 designated under section 103(4)(D), information about 

19 any sequestration if required by subsection (b), and other 

20 data and explanations that enhance public understanding 

21 of this division and actions taken under it. 

22 (b) SEQUESTRATION ORDER.—If the annual report 

23 issued at the end of a session of Congress under sub24 section (a) shows a debit on either PAYGO scorecard for 

25 the budget year, OMB shall prepare and the President 


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1 shall issue and include in that report a sequestration order 

2 that, upon issuance, shall reduce budgetary resources of 

3 direct spending programs by enough to offset that debit 

4 as prescribed in section 106. If there is a debit on both 

5 scorecards, the order shall fully offset the larger of the 

6 two debits. OMB shall include that order in the annual 

7 report and transmit it to the House of Representatives 

8 and the Senate. If the President issues a sequestration 

9 order, the annual report shall contain, for each budget ac10 count to be sequestered, estimates of the baseline level of 

11 budgetary resources subject to sequestration, the amount 

12 of budgetary resources to be sequestered, and the outlay 

13 reductions that will occur in the budget year and the sub14 sequent fiscal year because of that sequestration. 

15 SEC. 106. CALCULATING A SEQUESTRATION. 

16 (a) REDUCING NONEXEMPT BUDGETARY RE17 SOURCES BY A UNIFORM PERCENTAGE.—OMB shall cal18 culate the uniform percentage by which the budgetary re19 sources of nonexempt direct spending programs are to be 

20 sequestered such that the outlay savings resulting from 

21 that sequestration, as calculated under subsection (b), 

22 shall offset the budget-year debit, if any on the applicable 

23 PAYGO scorecard. If the uniform percentage calculated 

24 under the prior sentence exceeds 4 percent, the Medicare 

25 programs described in section 256(d) of BBEDCA shall 


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1 be reduced by 4 percent and the uniform percentage by 

2 which the budgetary resources of all other nonexempt di3 rect spending programs are to be sequestered shall be in4 creased, as necessary, so that the sequestration of Medi5 care and of all other nonexempt direct spending programs 

6 together produce the required outlay savings. 

7 (b) OUTLAY SAVINGS.—In determining the amount 

8 by which a sequestration offsets a budget-year debit, OMB 

9 shall count— 

10 (1) the amount by which the sequestration in a 

11 crop year of crop support payments, pursuant to 

12 section 256(j) of BBEDCA, reduces outlays in the 

13 budget year and the subsequent fiscal year; 

14 (2) the amount by which the sequestration of 

15 Medicare payments in the 12-month period following 

16 the sequestration order, pursuant to section 256(d) 

17 of BBEDCA, reduces outlays in the budget year and 

18 the subsequent fiscal year; and 

19 (3) the amount by which the sequestration in 

20 the budget year of the budgetary resources of other 

21 nonexempt mandatory programs reduces outlays in 

22 the budget year and in the subsequent fiscal year. 


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1 SEC. 107. CURRENT POLICY ADJUSTMENT TO THE CBO ES2 TIMATES. 

3 (a) PURPOSE.—The purpose of this section is to pro4 vide for adjustments of estimates of budgetary effects of 

5 PAYGO legislation for legislation affecting four areas of 

6 the budget— 

7 (1) payments made under section 1848 of the 

8 Social Security Act (titled Payment for Physicians’ 

9 Services); 

10 (2) the Estate and Gift Tax under subtitle B of 

11 the Internal Revenue Code of 1986; 

12 (3) the AMT; and 

13 (4) provisions of EGTRRA or JGTRRA that 

14 amended the Internal Revenue Code of 1986 (or 

15 provisions in later statutes further amending the 

16 amendments made by EGTRRA or JGTRRA), other 

17 than— 

18 (A) the provisions of those two Acts that 

19 were made permanent by the Pension Protec20 tion Act of 2006 (Public Law 109–280); 

21 (B) amendments to the estate and gift tax 

22 referred to in paragraph (2); 

23 (C) the AMT referred to in paragraph (3); 

24 (D) the 35 percent bracket and that por25 tion of the 33 percent bracket that applies to 


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1 taxable income greater than $200,000 for an 

2 individual and $250,000 for a couple; and 

3 (E) provisions in those two Acts relating to 

4 taxes rates on capital gains and dividends. 

5 (b) MEDICARE PAYMENTS TO PHYSICIANS.— 

6 (1) CRITERIA.—Legislation that includes provi7 sions amending or superseding the system of pay8 ments under section 1848 of the Social Security Act 

9 shall trigger the current policy adjustment required 

10 by this division. 

11 (2) ADJUSTMENT.—The amount of the max12 imum current policy adjustment shall be the dif13 ference between— 

14 (A) estimated net outlays attributable to 

15 the payments made to physicians under that 

16 section of the Social Security Act (as scheduled 

17 on July 15, 2009, to be in effect); and 

18 (B) what those net outlays would have 

19 been if the nominal payment rates and related 

20 parameters in effect for 2009 had been in effect 

21 thereafter without change. 

22 (c) ESTATE AND GIFT TAX.— 

23 (1) CRITERIA.—Legislation that includes provi24 sions amending the Estate and Gift Tax under sub25 title B of the Internal Revenue Code of 1986 shall 


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1 trigger the current policy adjustment required by 

2 this division. 

3 (2) ADJUSTMENT.—The amount of the max4 imum current policy adjustment shall be the dif5 ference between— 

6 (A) total revenues projected to be collected 

7 under the Internal Revenue Code of 1986 (as 

8 scheduled on July 15, 2009, to be in effect); 

9 and 

10 (B) what those revenue collections would 

11 have been if, on the date of enactment of the 

12 legislation meeting the criteria in paragraph 

13 (1), estate and gift tax law had instead been 

14 amended so that the tax rates, nominal exemp15 tion amounts, and related parameters in effect 

16 for tax year 2009 had remained in effect there17 after without change. 

18 (d) PERMANENT EXTENSION OF MIDDLE-CLASS TAX

19 CUTS AND AMT RELIEF.— 

20 (1) CRITERIA.—Legislation that includes provi21 sions extending middle-class tax cuts or AMT relief 

22 shall trigger the current policy adjustment required 

23 by this division if those provisions extend one or 

24 more of the following provisions— 


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1 (A) AMT relief for calendar year 2010 and 

2 subsequent years in such a manner that the 

3 number of AMT taxpayers is not estimated to 

4 exceed the number of AMT taxpayers in tax 

5 year 2008 in any year through the tenth year 

6 after enactment; 

7 (B) the 10 percent bracket as in effect for 

8 tax year 2010, as provided for under section 

9 101(a) of the Economic Growth and Tax Relief 

10 Reconciliation Act of 2001 and any later 

11 amendments through July 15, 2009; 

12 (C) the child tax credit as in effect for tax 

13 year 2010, as provided for under section 201 of 

14 the Economic Growth and Tax Relief Reconcili15 ation Act and any later amendments through 

16 July 15, 2009; 

17 (D) tax benefits for married couples as in 

18 effect for tax year 2010, as provided for under 

19 title III of the Economic Growth and Tax Relief 

20 Reconciliation Act and any later amendments 

21 through July 15, 2009; 

22 (E) the adoption credit as in effect in tax 

23 year 2010, as provided for under section 202 of 

24 the Economic Growth and Tax Relief ReconciliVerDate Nov 24 2008 00:56 Jan 21, 2010 Jkt 089200 PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 E:\BILLS\H3961.PCS H3961

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1 ation Act of 2001 and any later amendments 

2 through July 15, 2009; 

3 (F) the dependent care credit as in effect 

4 in tax year 2010, as provided for under section 

5 204 of the Economic Growth and Tax Relief 

6 Reconciliation Act of 2001 and any later 

7 amendments through July 15, 2009; 

8 (G) the employer-provided child care credit 

9 as in effect in tax year 2010, as provided for 

10 under section 205 of the Economic Growth and 

11 Tax Relief Reconciliation Act of 2001 and any 

12 later amendments through July 15, 2009; 

13 (H) the education tax benefits as in effect 

14 in tax year 2010, as provided for under title IV 

15 of the Economic Growth and Tax Relief Rec16 onciliation Act of 2001 and any later amend17 ments through July 15, 2009; 

18 (I) the 25 and 28 percent brackets as in 

19 effect for tax year 2010, as provided for under 

20 section 101(a) of the Economic Growth and 

21 Tax Relief Reconciliation Act of 2001 and any 

22 later amendments through July 15, 2009; and 

23 (J) the 33 percent brackets as in effect for 

24 tax year 2010, as provided for under section 

25 101(a) of the Economic Growth and Tax Relief 


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1 Reconciliation Act of 2001 and any later 

2 amendment affecting taxpayers with taxable in3 come of $200,000 or less for individuals and 

4 $250,000 or less for couples in calendar year 

5 2010 and increased in each subsequent year by 

6 an amount equal to the cost of living adjust7 ment determined under section 1(f)(3) of the 

8 Internal Revenue Code of 1986 for the calendar 

9 year in which the taxable year begins, deter10 mined by substituting ‘‘calendar year 2008’’ for 

11 ‘‘calendar year 1992’’ in subparagraph (B) 

12 thereof. 

13 (2) ADJUSTMENT.—The amount of the max14 imum current policy adjustment shall be the dif15 ference between what total revenues would have been 

16 under the Internal Revenue Code of 1986 (as sched17 uled on July 15, 2009, to be in effect) and what rev18 enues would be if legislation— 

19 (A) permanently extending the AMT ex20 emption and brackets in effect in tax year 2009 

21 but increased in tax year 2010 and each subse22 quent tax year as indicated under subsection 

23 (d)(2)(B), along with any additional amount 

24 necessary to prevent the number of taxpayers 

25 who must pay AMT from increasing; and 


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1 (B) permanently extending the provisions 

2 identified in paragraph (1), 

3 were enacted on the same day as the legislation re4 ferred to in paragraph (1). 

5 SEC. 108. APPLICATION OF BBEDCA. 

6 For purposes of this division— 

7 (1) notwithstanding section 275 of BBEDCA, 

8 the provisions of sections 255, 256, 257, and 274 of 

9 BBEDCA, as amended by this division, shall apply 

10 to the provisions of this division; 

11 (2) references in sections 255, 256, 257, and 

12 274 to ‘‘this part’’ or ‘‘this title’’ shall be interpreted 

13 as applying to this division; 

14 (3) references in sections 255, 256, 257, and 

15 274 of BBEDCA to ‘‘section 254’’ shall be inter16 preted as referencing section 105 of this division; 

17 (4) the reference in section 256(b) of BBEDCA 

18 to ‘‘section 252 or 253’’ shall be interpreted as ref19 erencing section 105 of this division; 

20 (5) the reference in section 256(d)(1) of 

21 BBEDCA to ‘‘section 252 or 253’’ shall be inter22 preted as referencing section 106 of this division; 

23 (6) the reference in section 256(d)(4) of 

24 BBEDCA to ‘‘section 252 or 253’’ shall be inter25 preted as referencing section 105 of this division; 


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1 (7) section 256(k) of BBEDCA shall apply to 

2 a sequestration, if any, under this division; and 

3 (8) references in section 257(e) of BBEDCA to 

4 ‘‘section 251, 252, or 253’’ shall be interpreted as 

5 referencing section 104 of this division. 

6 SEC. 109. TECHNICAL CORRECTIONS. 

7 (a) Section 250(c)(18) of BBEDCA is amended by 

8 striking ‘‘the expenses the Federal deposit insurance agen9 cies’’ and inserting ‘‘the expenses of the Federal deposit 

10 insurance agencies’’. 

11 (b) Section 256(k)(1) of BBEDCA is amended by 

12 striking ‘‘in paragraph (5)’’ and inserting ‘‘in paragraph 

13 (6)’’. 

14 SEC. 110. CONFORMING AMENDMENTS. 

15 (a) Section 256(a) of BBEDCA is repealed. 

16 (b) Section 256(b) of BBEDCA is amended by strik17 ing ‘‘origination fees under sections 438(c)(2) and 455(c) 

18 of that Act shall each be increased by 0.50 percentage 

19 point.’’ and inserting in lieu thereof ‘‘origination fees 

20 under sections 438(c)(2) and (6) and 455(c) and loan 

21 processing and issuance fees under section 

22 428(f)(1)(A)(ii) of that Act shall each be increased by the 

23 uniform percentage specified in that sequestration order, 

24 and, for student loans originated during the period of the 

25 sequestration, special allowance payments under section 


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1 438(b) of that Act accruing during the period of the se2 questration shall be reduced by the uniform percentage 

3 specified in that sequestration order.’’. 

4 (c) Section 256(c) of BBEDCA is repealed. 

5 (d) Section 256(d) of BBEDCA is amended— 

6 (1) by redesignating paragraphs (2), (3), and 

7 (4) as paragraphs (3), (5), and (6); 

8 (2) by amending paragraph (1) to read as fol9 lows: 

10 ‘‘(1) CALCULATION OF REDUCTION IN PAYMENT

11 AMOUNTS.—To achieve the total percentage reduc12 tion in those programs required by section 252 or 

13 253, subject to paragraph (2), and notwithstanding 

14 section 710 of the Social Security Act, OMB shall 

15 determine, and the applicable Presidential order 

16 under section 254 shall implement, the percentage 

17 reduction that shall apply, with respect to the health 

18 insurance programs under title XVIII of the Social 

19 Security Act— 

20 ‘‘(A) in the case of parts A and B of such 

21 title, to individual payments for services fur22 nished during the one-year period beginning on 

23 the first day of the first month beginning after 

24 the date the order is issued (or, if later, the 

25 date specified in paragraph (4)); and 


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1 ‘‘(B) in the case of parts C and D, to 

2 monthly payments under contracts under such 

3 parts for the same one-year period; 

4 such that the reduction made in payments under 

5 that order shall achieve the required total percentage 

6 reduction in those payments for that period.’’; 

7 (3) by inserting after paragraph (1) the fol8 lowing: 

9 ‘‘(2) UNIFORM REDUCTION RATE; MAXIMUM

10 PERMISSIBLE REDUCTION.—Reductions in payments 

11 for programs and activities under such title XVIII 

12 pursuant to a sequestration order under section 254 

13 shall be at a uniform rate, which shall not exceed 4 

14 percent, across all such programs and activities sub15 ject to such order.’’; 

16 (4) by inserting after paragraph (3), as redesig17 nated, the following: 

18 ‘‘(4) TIMING OF SUBSEQUENT SEQUESTRATION

19 ORDER.—A sequestration order required by section 

20 252 or 253 with respect to programs under such 

21 title XVIII shall not take effect until the first month 

22 beginning after the end of the effective period of any 

23 prior sequestration order with respect to such pro24 grams, as determined in accordance with paragraph 

25 (1).’’; 


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1 (5) in paragraph (6), as redesignated, to read 

2 as follows: 

3 ‘‘(6) SEQUESTRATION DISREGARDED IN COM4 PUTING PAYMENT AMOUNTS.—The Secretary of 

5 Health and Human Services shall not take into ac6 count any reductions in payment amounts which 

7 have been or may be effected under this part, for 

8 purposes of computing any adjustments to payment 

9 rates under such title XVIII, specifically including— 

10 ‘‘(A) the part C growth percentage under 

11 section 1853(c)(6); 

12 ‘‘(B) the part D annual growth rate under 

13 section 1860D–2(b)(6); and 

14 ‘‘(C) application of risk corridors to part D 

15 payment rates under section 1860D–15(e).’’; 

16 and 

17 (6) by adding after paragraph (6), as redesig18 nated, the following: 

19 ‘‘(7) EXEMPTIONS FROM SEQUESTRATION.—In 

20 addition to the programs and activities specified in 

21 section 255, the following shall be exempt from se22 questration under this part: 

23 ‘‘(A) PART D LOW-INCOME SUBSIDIES.— 

24 Premium and cost-sharing subsidies under sec25 tion 1860D–14 of the Social Security Act. 


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1 ‘‘(B) PART D CATASTROPHIC SUBSIDY.— 

2 Payments under section 1860D–15(b) and 

3 (e)(2)(B) of the Social Security Act. 

4 ‘‘(C) QUALIFIED INDIVIDUAL (QI) PRE5 MIUMS.—Payments to States for coverage of 

6 Medicare cost-sharing for certain low-income 

7 Medicare beneficiaries under section 1933 of 

8 the Social Security Act.’’. 

9 SEC. 111. EXEMPT PROGRAMS AND ACTIVITIES. 

10 (a) DESIGNATIONS.—Section 255 of BBEDCA is 

11 amended by redesignating subsection (i) as (j) and strik12 ing ‘‘1998’’ and inserting in lieu thereof ‘‘2010’’. 

13 (b) SOCIAL SECURITY, VETERANS PROGRAMS, NET

14 INTEREST, AND TAX CREDITS.—Subsections (a) through 

15 (d) of section 255 of BBEDCA are amended to read as 

16 follows: 

17 ‘‘(a) SOCIAL SECURITY BENEFITS AND TIER I RAIL18 ROAD RETIREMENT BENEFITS.—Benefits payable under 

19 the old-age, survivors, and disability insurance program 

20 established under title II of the Social Security Act (42 

21 U.S.C. 401 et seq.), and benefits payable under section 

22 231b(a), 231b(f)(2), 231c(a), and 231c(f) of title 45, 

23 United States Code, shall be exempt from reduction under 

24 any order issued under this part. 


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1 ‘‘(b) VETERANS PROGRAMS.—The following program 

2 shall be exempt from reduction under any order issued 

3 under this part— 

4 ‘‘All programs administered by the Department 

5 of Veterans Affairs. 

6 ‘‘Special Benefits for Certain World War II 

7 Veterans (28–0401–0–1–701). 

8 ‘‘(c) NET INTEREST.—No reduction of payments for 

9 net interest (all of major functional category 900) shall 

10 be made under any order issued under this part. 

11 ‘‘(d) REFUNDABLE INCOME TAX CREDITS.—Pay12 ments to individuals made pursuant to provisions of the 

13 Internal Revenue Code of 1986 establishing refundable 

14 tax credits shall be exempt from reduction under any order 

15 issued under this part.’’. 

16 (c) OTHER PROGRAMS AND ACTIVITIES, LOW-IN17 COME PROGRAMS, AND ECONOMIC RECOVERY PRO18 GRAMS.—Subsections (g) and (h) of section 255 of 

19 BBEDCA are amended to read as follows: 

20 ‘‘(g) OTHER PROGRAMS AND ACTIVITIES.— 

21 ‘‘(1)(A) The following budget accounts and ac22 tivities shall be exempt from reduction under any 

23 order issued under this part: 


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1 ‘‘Activities resulting from private dona2 tions, bequests, or voluntary contributions to 

3 the Government. 

4 ‘‘Activities financed by voluntary payments 

5 to the Government for goods or services to be 

6 provided for such payments. 

7 ‘‘Administration of Territories, Northern 

8 Mariana Islands Covenant grants (14–0412–0– 

9 1–808). 

10 ‘‘Advances to the Unemployment Trust 

11 Fund and Other Funds (16–0327–0–1–600). 

12 ‘‘Black Lung Disability Trust Fund Refi13 nancing (16–0329–0–1–601). 

14 ‘‘Bonneville Power Administration Fund 

15 and borrowing authority established pursuant 

16 to section 13 of Public Law 93–454 (1974), as 

17 amended (89–4045–0–3–271). 

18 ‘‘Claims, Judgments, and Relief Acts (20– 

19 1895–0–1–808). 

20 ‘‘Compact of Free Association (14–0415– 

21 0–1–808). 

22 ‘‘Compensation of the President (11– 

23 0209–01–1–802). 

24 ‘‘Comptroller of the Currency, Assessment 

25 Funds (20–8413–0–8–373). 


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1 ‘‘Continuing Fund, Southeastern Power 

2 Administration (89–5653–0–2–271). 

3 ‘‘Continuing Fund, Southwestern Power 

4 Administration (89–5649–0–2–271). 

5 ‘‘Dual Benefits Payments Account (60– 

6 0111–0–1–601). 

7 ‘‘Emergency Fund, Western Area Power 

8 Administration (89–5069–0–2–271). 

9 ‘‘Exchange Stabilization Fund (20–4444– 

10 0–3–155). 

11 ‘‘Federal Deposit Insurance Corporation, 

12 Deposit Insurance Fund (51–4596–4–4–373). 

13 ‘‘Federal Deposit Insurance Corporation, 

14 FSLIC Resolution Fund (51–4065–0–3–373). 

15 ‘‘Federal Deposit Insurance Corporation, 

16 Noninterest Bearing Transaction Account 

17 Guarantee (51–4458–0–3–373). 

18 ‘‘Federal Deposit Insurance Corporation, 

19 Senior Unsecured Debt Guarantee (51–4457– 

20 0–3–373). 

21 ‘‘Federal Housing Finance Agency, Admin22 istrative Expenses (95–5532–0–2–371). 

23 ‘‘Federal Payment to the District of Co24 lumbia Judicial Retirement and Survivors An25 nuity Fund (20–1713–0–1–752). 


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1 ‘‘Federal Payment to the District of Co2 lumbia Pension Fund (20–1714–0–1–601). 

3 ‘‘Federal Payments to the Railroad Retire4 ment Accounts (60–0113–0–1–601). 

5 ‘‘Federal Reserve Bank Reimbursement 

6 Fund (20–1884–0–1–803). 

7 ‘‘Financial Agent Services (20–1802–0–1– 

8 803). 

9 ‘‘Foreign Military Sales Trust Fund (11– 

10 8242–0–7–155). 

11 ‘‘Hazardous Waste Management, Con12 servation Reserve Program (12–4336–0–3– 

13 999). 

14 ‘‘Host Nation Support Fund for Relocation 

15 (97–8337–0–7–051). 

16 ‘‘Internal Revenue Collections for Puerto 

17 Rico (20–5737–0–2–806). 

18 ‘‘Intragovernmental funds, including those 

19 from which the outlays are derived primarily 

20 from resources paid in from other government 

21 accounts, except to the extent such funds are 

22 augmented by direct appropriations for the fis23 cal year during which an order is in effect. 

24 ‘‘Medical Facilities Guarantee and Loan 

25 Fund (75–9931–0–3–551). 


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1 ‘‘National Credit Union Administration, 

2 Central Liquidity Facility (25–4470–0–3–373). 

3 ‘‘National Credit Union Administration, 

4 Corporate Credit Union Share Guarantee Pro5 gram (25–4476–0–3–376). 

6 ‘‘National Credit Union Administration, 

7 Credit Union Homeowners Affordability Relief 

8 Program (25–4473–0–3–371). 

9 ‘‘National Credit Union Administration, 

10 Credit Union Share Insurance Fund (25–4468– 

11 0–3–373). 

12 ‘‘National Credit Union Administration, 

13 Credit Union System Investment Program (25– 

14 4474–0–3–376). 

15 ‘‘National Credit Union Administration, 

16 Operating fund (25–4056–0–3–373). 

17 ‘‘National Credit Union Administration, 

18 Share Insurance Fund Corporate Debt Guar19 antee Program (25–4469–0–3–376). 

20 ‘‘National Credit Union Administration, 

21 U.S. Central Federal Credit Union Capital Pro22 gram (25–4475–0–3–376). 

23 ‘‘Office of Thrift Supervision (20–4108–0– 

24 3–373). 


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1 ‘‘Panama Canal Commission Compensation 

2 Fund (16–5155–0–2–602). 

3 ‘‘Payment of Vietnam and USS Pueblo 

4 prisoner-of-war claims within the Salaries and 

5 Expenses, Foreign Claims Settlement account 

6 (15–0100–0–1–153). 

7 ‘‘Payment to Civil Service Retirement and 

8 Disability Fund (24–0200–0–1–805). 

9 ‘‘Payment to Department of Defense Medi10 care-Eligible Retiree Health Care Fund (97– 

11 0850–0–1–054). 

12 ‘‘Payment to Judiciary Trust Funds (10– 

13 0941–0–1–752). 

14 ‘‘Payment to Military Retirement Fund 

15 (97–0040–0–1–054). 

16 ‘‘Payment to the Foreign Service Retire17 ment and Disability Fund (19–0540–0–1–153). 

18 ‘‘Payments to Copyright Owners (03– 

19 5175–0–2–376). 

20 ‘‘Payments to Health Care Trust Funds 

21 (75–0580–0–1–571). 

22 ‘‘Payment to Radiation Exposure Com23 pensation Trust Fund (15–0333–0–1–054). 

24 ‘‘Payments to Social Security Trust Funds 

25 (28–0404–0–1–651). 


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1 ‘‘Payments to the United States Terri2 tories, Fiscal Assistance (14–0418–0–1–806). 

3 ‘‘Payments to trust funds from excise 

4 taxes or other receipts properly creditable to 

5 such trust funds. 

6 ‘‘Payments to widows and heirs of de7 ceased Members of Congress (00–0215–0–1– 

8 801). 

9 ‘‘Postal Service Fund (18–4020–0–3–372). 

10 ‘‘Radiation Exposure Compensation Trust 

11 Fund (15–8116–0–1–054). 

12 ‘‘Reimbursement to Federal Reserve Banks 

13 (20–0562–0–1–803). 

14 ‘‘Salaries of Article III judges. 

15 ‘‘Soldiers and Airmen’s Home, payment of 

16 claims (84–8930–0–7–705). 

17 ‘‘Tennessee Valley Authority Fund, except 

18 nonpower programs and activities (64–4110–0– 

19 3–999). 

20 ‘‘Tribal and Indian trust accounts within 

21 the Department of the Interior which fund 

22 prior legal obligations of the Government or 

23 which are established pursuant to Acts of Con24 gress regarding Federal management of tribal 

25 real property or other fiduciary responsibilities, 


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1 including but not limited to Tribal Special 

2 Fund (14–5265–0–2–452), Tribal Trust Fund 

3 (14–8030–0–7–452), White Earth Settlement 

4 (14–2204–0–1–452), and Indian Water Rights 

5 and Habitat Acquisition (14–5505–0–2–303). 

6 ‘‘United Mine Workers of America 1992 

7 Benefit Plan (95–8260–0–7–551). 

8 ‘‘United Mine Workers of America 1993 

9 Benefit Plan (95–8535–0–7–551). 

10 ‘‘United Mine Workers of America Com11 bined Benefit Fund (95–8295–0–7–551). 

12 ‘‘United States Enrichment Corporation 

13 Fund (95–4054–0–3–271). 

14 ‘‘Universal Service Fund (27–5183–0–2– 

15 376). 

16 ‘‘Vaccine Injury Compensation (75–0320– 

17 0–1–551). 

18 ‘‘Vaccine Injury Compensation Program 

19 Trust Fund (20–8175–0–7–551). 

20 ‘‘(B) The following Federal retirement and dis21 ability accounts and activities shall be exempt from 

22 reduction under any order issued under this part: 

23 ‘‘Black Lung Disability Trust Fund (20– 

24 8144–0–7–601). 


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1 ‘‘Central Intelligence Agency Retirement 

2 and Disability System Fund (56–3400–0–1– 

3 054). 

4 ‘‘Civil Service Retirement and Disability 

5 Fund (24–8135–0–7–602). 

6 ‘‘Comptrollers general retirement system 

7 (05–0107–0–1–801). 

8 ‘‘Contributions to U.S. Park Police annu9 ity benefits, Other Permanent Appropriations 

10 (14–9924–0–2–303). 

11 ‘‘Court of Appeals for Veterans Claims Re12 tirement Fund (95–8290–0–7–705). 

13 ‘‘Department of Defense Medicare-Eligible 

14 Retiree Health Care Fund (97–5472–0–2–551). 

15 ‘‘District of Columbia Federal Pension 

16 Fund (20–5511–0–2–601). 

17 ‘‘District of Columbia Judicial Retirement 

18 and Survivors Annuity Fund (20–8212–0–7– 

19 602). 

20 ‘‘Energy Employees Occupational Illness 

21 Compensation Fund (16–1523–0–1–053). 

22 ‘‘Foreign National Employees Separation 

23 Pay (97–8165–0–7–051). 


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1 ‘‘Foreign Service National Defined Con2 tributions Retirement Fund (19–5497–0–2– 

3 602). 

4 ‘‘Foreign Service National Separation Li5 ability Trust Fund (19–8340–0–7–602). 

6 ‘‘Foreign Service Retirement and Dis7 ability Fund(19–8186–0–7–602). 

8 ‘‘Government Payment for Annuitants, 

9 Employees Health Benefits (24–0206–0–1– 

10 551). 

11 ‘‘Government Payment for Annuitants, 

12 Employee Life Insurance (24–0500–0–1–602). 

13 ‘‘Judicial Officers’ Retirement Fund (10– 

14 8122–0–7–602). 

15 ‘‘Judicial Survivors’ Annuities Fund (10– 

16 8110–0–7–602). 

17 ‘‘Military Retirement Fund (97–8097–0– 

18 7–602). 

19 ‘‘National Railroad Retirement Investment 

20 Trust (60–8118–0–7–601). 

21 ‘‘National Oceanic and Atmospheric Ad22 ministration retirement (13–1450–0–1–306). 

23 ‘‘Pensions for former Presidents (47– 

24 0105–0–1–802). 


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48 

HR 3961 PCS 

1 ‘‘Postal Service Retiree Health Benefits 

2 Fund (24–5391–0–2–551). 

3 ‘‘Public Safety Officer Benefits (15–0403– 

4 0–1–754). 

5 ‘‘Rail Industry Pension Fund (60–8011– 

6 0–7–601). 

7 ‘‘Retired Pay, Coast Guard (70–0602–0– 

8 1–403). 

9 ‘‘Retirement Pay and Medical Benefits for 

10 Commissioned Officers, Public Health Service 

11 (75–0379–0–1–551). 

12 ‘‘Special Benefits for Disabled Coal Miners 

13 (16–0169–0–1–601). 

14 ‘‘Special Benefits, Federal Employees’ 

15 Compensation Act (16–1521–0–1–600). 

16 ‘‘Special Workers Compensation Expenses 

17 (16–9971–0–7–601). 

18 ‘‘Tax Court Judges Survivors Annuity 

19 Fund (23–8115–0–7–602). 

20 ‘‘United States Court of Federal Claims 

21 Judges’ Retirement Fund (10–8124–0–7–602). 

22 ‘‘United States Secret Service, DC Annuity 

23 (70–0400–0–1–751). 

24 ‘‘Voluntary Separation Incentive Fund 

25 (97–8335–0–7–051). 


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49 

HR 3961 PCS 

1 ‘‘(2) Prior legal obligations of the Government 

2 in the following budget accounts and activities shall 

3 be exempt from any order issued under this part: 

4 ‘‘Biomass Energy Development (20–0114– 

5 0–1–271). 

6 ‘‘Check Forgery Insurance Fund (20– 

7 4109–0–3–803). 

8 ‘‘Credit liquidating accounts. 

9 ‘‘Credit reestimates. 

10 ‘‘Employees Life Insurance Fund (24– 

11 8424–0–8–602). 

12 ‘‘Federal Aviation Insurance Revolving 

13 Fund (69–4120–0–3–402). 

14 ‘‘Federal Crop Insurance Corporation 

15 Fund (12–4085–0–3–351). 

16 ‘‘Federal Emergency Management Agency, 

17 National Flood Insurance Fund (58–4236–0– 

18 3–453). 

19 ‘‘Federal Home Loan Mortgage Corpora20 tion (Freddie Mac). 

21 ‘‘Federal National Mortgage Corporation 

22 (Fannie Mae). 

23 ‘‘Geothermal resources development fund 

24 (89–0206–0–1–271). 


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50 

HR 3961 PCS 

1 ‘‘Low-Rent Public Housing—Loans and 

2 Other Expenses (86–4098–0–3–604). 

3 ‘‘Maritime Administration, War Risk In4 surance Revolving Fund (69–4302–0–3–403). 

5 ‘‘Natural Resource Damage Assessment 

6 Fund (14–1618–0–1–302). 

7 ‘‘Overseas Private Investment Corporation, 

8 Noncredit Account (71–4184–0–3–151). 

9 ‘‘Pension Benefit Guaranty Corporation 

10 Fund (16–4204–0–3–601). 

11 ‘‘San Joaquin Restoration Fund (14– 

12 5537–0–2–301). 

13 ‘‘Servicemembers’ Group Life Insurance 

14 Fund (36–4009–0–3–701). 

15 ‘‘Terrorism Insurance Program (20–0123– 

16 0–1–376). 

17 ‘‘(h) LOW-INCOME PROGRAMS.—The following pro18 grams shall be exempt from reduction under any order 

19 issued under this part: 

20 ‘‘Academic Competitiveness/Smart Grant Pro21 gram (91–0205–0–1–502). 

22 ‘‘Child Care Entitlement to States (75–1550– 

23 0–1–609). 

24 ‘‘Child Enrollment Contingency Fund (75– 

25 5551–0–2–551). 


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51 

HR 3961 PCS 

1 ‘‘Child Nutrition Programs (with the exception 

2 of special milk programs) (12–3539–0–1–605). 

3 ‘‘Children’s Health Insurance Fund (75–0515– 

4 0–1–551). 

5 ‘‘Commodity Supplemental Food Program (12– 

6 3507–0–1–605). 

7 ‘‘Contingency Fund (75–1522–0–1–609). 

8 ‘‘Family Support Programs (75–1501–0–1– 

9 609). 

10 ‘‘Federal Pell Grants under section 401 Title 

11 IV of the Higher Education Act. 

12 ‘‘Grants to States for Medicaid (75–0512–0–1– 

13 551). 

14 ‘‘Payments for Foster Care and Permanency 

15 (75–1545–0–1–609). 

16 ‘‘Supplemental Nutrition Assistance Program 

17 (12–3505–0–1–605). 

18 ‘‘Supplemental Security Income Program (28– 

19 0406–0–1–609). 

20 ‘‘Temporary Assistance for Needy Families 

21 (75–1552–0–1–609).’’. 

22 (d) ECONOMIC RECOVERY PROGRAMS.—Section 255 

23 of BBEDCA is amended by adding the following after 

24 subsection (h): 


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52 

HR 3961 PCS 

1 ‘‘(i) ECONOMIC RECOVERY PROGRAMS.—The fol2 lowing programs shall be exempt from reduction under 

3 any order issued under this part: 

4 ‘‘All programs enacted in, or increases in pro5 grams provided by, the American Recovery and Re6 investment Act of 2009. 

7 ‘‘Exchange Stabilization Fund-Money Market 

8 Mutual Fund Guaranty Facility (20–4274–0–3– 

9 376). 

10 ‘‘Financial Stabilization Reserve (20–0131–4– 

11 1–376). 

12 ‘‘GSE Mortgage-Backed Securities Purchase 

13 Program Account (20–0126–0–1–371). 

14 ‘‘GSE Preferred Stock Purchase Agreements 

15 (20–0125–0–1–371). 

16 ‘‘Office of Financial Stability (20–0128–0–1– 

17 376). 

18 ‘‘Special Inspector General for the Troubled 

19 Asset Relief Program (20–0133–0–1–376). 

20 ‘‘Troubled Asset Relief Program Account (20– 

21 0132–0–1–376). 

22 ‘‘Troubled Asset Relief Program Equity Pur23 chase Program (20–0134–0–1–376). 


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53 

HR 3961 PCS 

1 ‘‘Troubled Asset Relief Program, Home Afford2 able Modification Program (20–0136–0–1–604).’’. 

Passed the House of Representatives November 19, 

2009. 

Attest: LORRAINE C. MILLER, 

Clerk. 


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Calendar No. 252 

111TH CONGRESS 

2D SESSION H. R. 3961 

AN ACT 

To amend title XVIII of the Social Security Act to 

tration. forced by the threat of annual, automatic sequesnew tax and mandatory spending legislation, enAs-You-Go requirement of budget neutrality on physicians and to reinstitute and update the Payreform the Medicare SGR payment system for 

JANUARY 20, 2010 

Read the second time and placed on the calendar 


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