I 

111TH CONGRESS 

1ST SESSION H. R. 629 

To provide energy and commerce provisions of the American Recovery and 

Reinvestment Act of 2009. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 22, 2009 

Mr. WAXMAN introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committees on 

Ways and Means, Education and Labor, and Science and Technology, for 

a period to be subsequently determined by the Speaker, in each case for 

consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To provide energy and commerce provisions of the American 

Recovery and Reinvestment Act of 2009. 

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

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Energy and Commerce 

5 Recovery and Reinvestment Act’’. 


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1 TITLE I—BROADBAND 

2 COMMUNICATIONS 

3 SEC. 1001. INVENTORY OF BROADBAND SERVICE CAPA4 BILITY AND AVAILABILITY. 

5 (a) ESTABLISHMENT.—To provide a comprehensive 

6 nationwide inventory of existing broadband service capa7 bility and availability, the National Telecommunications 

8 and Information Administration (‘‘NTIA’’) shall develop 

9 and maintain a broadband inventory map of the United 

10 States that identifies and depicts the geographic extent 

11 to which broadband service capability is deployed and 

12 available from a commercial provider or public provider 

13 throughout each State. 

14 (b) PUBLIC AVAILABILITY AND INTERACTIVITY.— 

15 Not later than 2 years after the date of enactment of this 

16 Act, the NTIA shall make the broadband inventory map 

17 developed and maintained pursuant to this section acces18 sible by the public on a World Wide website of the NTIA 

19 in a form that is interactive and searchable. 

20 SEC. 1002. WIRELESS AND BROADBAND DEPLOYMENT 

21 GRANT PROGRAMS. 

22 (a) GRANTS AUTHORIZED.— 

23 (1) IN GENERAL.—The National Telecommuni24 cations and Information Administration (‘‘NTIA’’) 

25 is authorized to carry out a program to award 


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1 grants to eligible entities for the non-recurring costs 

2 associated with the deployment of broadband infra3 structure in rural, suburban, and urban areas, in ac4 cordance with the requirements of this section. 

5 (2) PROGRAM WEBSITE.—The NTIA shall de6 velop and maintain a website to make publicly avail7 able information about the program described in 

8 paragraph (1), including— 

9 (A) each prioritization report submitted by 

10 a State under subsection (b); 

11 (B) a list of eligible entities that have ap12 plied for a grant under this section, and the 

13 area or areas the entity proposes to serve; and 

14 (C) the status of each such application, 

15 whether approved, denied, or pending. 

16 (b) STATE PRIORITIES.— 

17 (1) PRIORITIES REPORT SUBMISSION.—Not 

18 later than 75 days after the date of enactment of 

19 this section, each State intending to participate in 

20 the program under this section shall submit to the 

21 NTIA a report indicating the geographic areas of 

22 the State which— 

23 (A) for the purposes of determining the 

24 need for Wireless Deployment Grants under 


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1 subsection (c), the State considers to have the 

2 greatest priority for— 

3 (i) wireless voice service in unserved 

4 areas; and 

5 (ii) advanced wireless broadband serv6 ice in underserved areas; and 

7 (B) for the purposes of determining the 

8 need for Broadband Deployment Grants under 

9 subsection (d), the State considers to have the 

10 greatest priority for— 

11 (i) basic broadband service in 

12 unserved areas; and 

13 (ii) advanced broadband service in un14 derserved areas. 

15 (2) LIMITATION.—The unserved and under16 served areas identified by a State in the report re17 quired by this subsection shall not represent, in the 

18 aggregate, more than 20 percent of the population 

19 or of the geographic area of such State. 

20 (c) WIRELESS DEPLOYMENT GRANTS.— 

21 (1) AUTHORIZED ACTIVITY.—The NTIA shall 

22 award Wireless Deployment Grants in accordance 

23 with this subsection from amounts authorized for 

24 Wireless Deployment Grants by this subtitle to eligi25 ble entities to deploy necessary infrastructure for the 


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1 provision of wireless voice service or advanced wire2 less broadband service to end users in designated 

3 areas. 

4 (2) GRANT DISTRIBUTION.—The NTIA shall 

5 seek to distribute grants, to the extent possible, so 

6 that 25 percent of the grants awarded under this 

7 subsection shall be awarded to eligible entities for 

8 providing wireless voice service to unserved areas 

9 and 75 percent of grants awarded under this sub10 section shall be awarded to eligible entities for pro11 viding advanced wireless broadband service to under12 served areas. 

13 (d) BROADBAND DEPLOYMENT GRANTS.— 

14 (1) AUTHORIZED ACTIVITY.—The NTIA shall 

15 award Broadband Deployment Grants in accordance 

16 with this subsection from amounts authorized for 

17 Broadband Deployment Grants by this subtitle to el18 igible entities to deploy necessary infrastructure for 

19 the provision of basic broadband service or advanced 

20 broadband service to end users in designated areas. 

21 (2) GRANT DISTRIBUTION.—The NTIA shall 

22 seek to distribute grants, to the extent possible, so 

23 that 25 percent of the grants awarded under this 

24 subsection shall be awarded to eligible entities for 

25 providing basic broadband service to unserved areas 


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1 and 75 percent of grants awarded under this sub2 section shall be awarded to eligible entities for pro3 viding advanced broadband service to underserved 

4 areas. 

5 (e) GRANT REQUIREMENTS.—The NTIA shall— 

6 (1) adopt rules to protect against unjust enrich7 ment; and 

8 (2) ensure that grant recipients— 

9 (A) meet buildout requirements; 

10 (B) maximize use of the supported infra11 structure by the public; 

12 (C) operate basic and advanced broadband 

13 service networks on an open access basis; 

14 (D) operate advanced wireless broadband 

15 service on a wireless open access basis; and 

16 (E) adhere to the principles contained in 

17 the Federal Communications Commission’s 

18 broadband policy statement (FCC 05–151, 

19 adopted August 5, 2005). 

20 (f) APPLICATIONS.— 

21 (1) SUBMISSION.—To be considered for a grant 

22 awarded under subsection (c) or (d), an eligible enti23 ty shall submit to the NTIA an application at such 

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1 tion and assurances as the NTIA may require. Such 

2 an application shall include— 

3 (A) a cost-study estimate for serving the 

4 particular geographic area to be served by the 

5 entity; 

6 (B) a proposed build-out schedule to resi7 dential households and small businesses in the 

8 area; 

9 (C) for applicants for Wireless Deployment 

10 Grants under subsection (c), a build-out sched11 ule for geographic coverage of such areas; and 

12 (D) any other requirements the NTIA 

13 deems necessary. 

14 (2) SELECTION.— 

15 (A) NOTIFICATION.—The NTIA shall no16 tify each eligible entity that has submitted a 

17 complete application whether the entity has 

18 been approved or denied for a grant under this 

19 section in a timely fashion. 

20 (B) GRANT DISTRIBUTION CONSIDER21 ATIONS.—In awarding grants under this sec22 tion, the NTIA shall, to the extent practical— 

23 (i) award not less than one grant in 

24 each State; 


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1 (ii) give substantial weight to whether 

2 an application is from an eligible entity to 

3 deploy infrastructure in an area that is an 

4 area— 

5 (I) identified by a State in a re6 port submitted under subsection (b); 

7 or 

8 (II) in which the NTIA deter9 mines there will be a significant 

10 amount of public safety or emergency 

11 response use of the infrastructure; 

12 and 

13 (iii) consider whether an application 

14 from an eligible entity to deploy infrastruc15 ture in an area— 

16 (I) will, if approved, increase the 

17 affordability of, or subscribership to, 

18 service to the greatest population of 

19 underserved users in the area; 

20 (II) will, if approved, enhance 

21 service for health care delivery, edu22 cation, or children to the greatest pop23 ulation of underserved users in the 

24 area; 


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1 (III) contains concrete plans for 

2 enhancing computer ownership or 

3 computer literacy in the area; 

4 (IV) is from a recipient of more 

5 than 20 percent matching grants from 

6 State, local, or private entities for 

7 service in the area and the extent of 

8 such commitment; and 

9 (V) will, if approved, result in 

10 unjust enrichment because the eligible 

11 entity has applied for, or intends to 

12 apply for, support for the non-recur13 ring costs through another Federal 

14 program for service in the area. 

15 (g) COORDINATION AND CONSULTATION.—The 

16 NTIA shall coordinate with the Federal Communications 

17 Commission and shall consult with other appropriate Fed18 eral agencies in implementing this section. 

19 (h) REPORT REQUIRED.—The NTIA shall submit an 

20 annual report to the Committee on Energy and Commerce 

21 of the House of Representatives and the Committee on 

22 Commerce, Science, and Transportation of the Senate for 

23 5 years assessing the impact of the grants funded under 

24 this section on the basis of the objectives and criteria de25 scribed in subsection (f)(2)(B)(iii). 


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1 (i) RULEMAKING AUTHORITY.—The NTIA shall have 

2 the authority to prescribe such rules as necessary to carry 

3 out the purposes of this section. 

4 (j) DEFINITIONS.—For the purpose of this section— 

5 (1) the term ‘‘advanced broadband service’’ 

6 means a service delivering data to the end user 

7 transmitted at a speed of at least 45 megabits per 

8 second downstream and at least 15 megabits per 

9 second upstream; 

10 (2) the term ‘‘advanced wireless broadband 

11 service’’ means a wireless service delivering to the 

12 end user data transmitted at a speed of at least 3 

13 megabits per second downstream and at least 1 

14 megabit per second upstream over an end-to-end 

15 internet protocol wireless network; 

16 (3) the term ‘‘basic broadband service’’ means 

17 a service delivering data to the end user transmitted 

18 at a speed of at least 5 megabits per second down19 stream and at least 1 megabit per second upstream; 

20 (4) the term ‘‘eligible entity’’ means— 

21 (A) a provider of wireless voice service, ad22 vanced wireless broadband service, basic 

23 broadband service, or advanced broadband serv24 ice, including a satellite carrier that provides 

25 any such service; 


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1 (B) a State or unit of local government, or 

2 agency or instrumentality thereof, that is or in3 tends to be a provider of any such service; and 

4 (C) any other entity, including construc5 tion companies, tower companies, backhaul 

6 companies, or other service providers, that the 

7 NTIA authorizes by rule to participate in the 

8 programs under this section, if such other enti9 ty is required to provide access to the supported 

10 infrastructure on a neutral, reasonable basis to 

11 maximize use; 

12 (5) the term ‘‘State’’ includes the District of 

13 Columbia and the territories and possessions; 

14 (6) the term ‘‘underserved area’’ shall be de15 fined by the Federal Communications Commission 

16 not later than 45 days after the date of enactment 

17 of this section; 

18 (7) the term ‘‘unserved area’’ shall be defined 

19 by the Federal Communications Commission not 

20 later than 45 days after the date of enactment of 

21 this section; 

22 (8) the term ‘‘wireless voice service’’ means the 

23 provision of two-way, real-time, voice communica24 tions using a mobile service; 


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1 (9) the term ‘‘open access’’ shall be defined by 

2 the Federal Communications Commission not later 

3 than 45 days after the date of enactment of this sec4 tion; and 

5 (10) the term ‘‘wireless open access’’ shall be 

6 defined by the Federal Communications Commission 

7 not later than 45 days after the date of enactment 

8 of this section. 

9 TITLE II—ENERGY 

10 Subtitle A—Energy Provisions 

11 SEC. 2001. TECHNICAL CORRECTIONS TO THE ENERGY 

12 INDEPENDENCE AND SECURITY ACT OF 2007. 

13 (a) Section 543(a) of the Energy Independence and 

14 Security Act of 2007 (42 U.S.C. 17153(a)) is amended— 

15 (1) by redesignating paragraphs (2) through 

16 (4) as paragraphs (3) through (5), respectively; and 

17 (2) by striking paragraph (1) and inserting the 

18 following: 

19 ‘‘(1) 34 percent to eligible units of local govern20 ment–alternative 1, in accordance with subsection 

21 (b); 

22 ‘‘(2) 34 percent to eligible units of local govern23 ment–alternative 2, in accordance with subsection 

24 (b);’’. 


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1 (b) Section 543(b) of the Energy Independence and 

2 Security Act of 2007 (42 U.S.C. 17153(b)) is amended 

3 by striking ‘‘subsection (a)(1)’’ and inserting ‘‘subsection 

4 (a)(1) or (2)’’. 

5 (c) Section 548(a)(1) of the Energy Independence 

6 and Security Act of 2007 (42 U.S.C. 17158(a)(1)) is 

7 amending by striking ‘‘; provided’’ and all that follows 

8 through ‘‘541(3)(B)’’. 

9 SEC. 2002. AMENDMENTS TO TITLE XIII OF THE ENERGY 

10 INDEPENDENCE AND SECURITY ACT OF 2007. 

11 Title XIII of the Energy Independence and Security 

12 Act of 2007 (42 U.S.C. 17381 and following) is amended 

13 as follows: 

14 (1) By amending subparagraph (A) of section 

15 1304(b)(3) to read as follows: 

16 ‘‘(A) IN GENERAL.—In carrying out the 

17 initiative, the Secretary shall provide financial 

18 support to smart grid demonstration projects in 

19 urban, suburban, and rural areas, including 

20 areas where electric system assets are controlled 

21 by tax-exempt entities and areas where electric 

22 system assets are controlled by investor-owned 

23 utilities.’’. 

24 (2) By amending subparagraph (C) of section 

25 1304(b)(3) to read as follows: 


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1 ‘‘(C) FEDERAL SHARE OF COST OF TECH2 NOLOGY INVESTMENTS.—The Secretary shall 

3 provide to an electric utility described in sub4 paragraph (B) or to other parties financial as5 sistance for use in paying an amount equal to 

6 not more than 50 percent of the cost of quali7 fying advanced grid technology investments 

8 made by the electric utility or other party to 

9 carry out a demonstration project.’’. 

10 (3) By inserting after section 1304(b)(3)(D) 

11 the following new subparagraphs: 

12 ‘‘(E) AVAILABILITY OF DATA.—The Sec13 retary shall establish and maintain a smart grid 

14 information clearinghouse in a timely manner 

15 which will make data from smart grid dem16 onstration projects and other sources available 

17 to the public. As a condition of receiving finan18 cial assistance under this subsection, a utility or 

19 other participant in a smart grid demonstration 

20 project shall provide such information as the 

21 Secretary may require to become available 

22 through the smart grid information clearing23 house in the form and within the timeframes as 

24 directed by the Secretary. The Secretary shall 

25 assure that business proprietary information 


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1 and individual customer information is not in2 cluded in the information made available 

3 through the clearinghouse. 

4 ‘‘(F) OPEN INTERNET-BASED PROTOCOLS

5 AND STANDARDS.—The Secretary shall require 

6 as a condition of receiving funding under this 

7 subsection that demonstration projects utilize 

8 open Internet-based protocols and standards if 

9 available.’’. 

10 (4) By amending paragraph (2) of section 

11 1304(c) to read as follows: 

12 ‘‘(2) to carry out subsection (b), such sums as 

13 may be necessary.’’. 

14 (5) By amending subsection (a) of section 1306 

15 by striking ‘‘reimbursement of one-fifth (20 per16 cent)’’ and inserting ‘‘grants of up to one-half (50 

17 percent)’’. 

18 (6) By striking the last sentence of subsection 

19 (b)(9) of section 1306. 

20 (7) By striking ‘‘are eligible for’’ in subsection 

21 (c)(1) of section 1306 and inserting ‘‘utilize’’. 

22 (8) By amending subsection (e) of section 1306 

23 to read as follows: 

24 ‘‘(e) PROCEDURES AND RULES.—The Secretary 

25 shall— 


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1 ‘‘(1) establish within 60 days after the enact2 ment of the American Recovery and Reinvestment 

3 Act of 2009 procedures by which applicants can ob4 tain grants of not more than one-half of their docu5 mented costs; 

6 ‘‘(2) require as a condition of receiving a grant 

7 under this section that grant recipients utilize open 

8 Internet-based protocols and standards if available; 

9 ‘‘(3) establish procedures to ensure that there is 

10 no duplication or multiple payment or recovery for 

11 the same investment or costs, that the grant goes to 

12 the party making the actual expenditures for quali13 fying smart grid investments, and that the grants 

14 made have significant effect in encouraging and fa15 cilitating the development of a smart grid; 

16 ‘‘(4) maintain public records of grants made, 

17 recipients, and qualifying smart grid investments 

18 which have received grants; 

19 ‘‘(5) establish procedures to provide advance 

20 payment of moneys up to the full amount of the 

21 grant award; and 

22 ‘‘(6) have and exercise the discretion to deny 

23 grants for investments that do not qualify in the 

24 reasonable judgment of the Secretary.’’. 


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1 SEC. 2003. RENEWABLE ENERGY AND ELECTRIC POWER 

2 TRANSMISSION LOAN GUARANTEE PROGRAM. 

3 (a) AMENDMENT.—Title XVII of the Energy Policy 

4 Act of 2005 (42 U.S.C. 16511 et seq.) is amended by add5 ing the following at the end: 

6 ‘‘SEC. 1705. TEMPORARY PROGRAM FOR RAPID DEPLOY7 MENT OF RENEWABLE ENERGY AND ELEC8 TRIC POWER TRANSMISSION PROJECTS. 

9 ‘‘(a) IN GENERAL.—Notwithstanding section 1703, 

10 the Secretary may make guarantees under this section 

11 only for commercial technology projects under subsection 

12 (b) that will commence construction not later than Sep13 tember 30, 2011. 

14 ‘‘(b) CATEGORIES.—Projects from only the following 

15 categories shall be eligible for support under this section: 

16 ‘‘(1) Renewable energy systems that generate 

17 electricity. 

18 ‘‘(2) Electric power transmission systems, in19 cluding upgrading and reconductoring projects. 

20 ‘‘(c) FACTORS RELATING TO ELECTRIC POWER

21 TRANSMISSION SYSTEMS.—In determining to make guar22 antees to projects described in subsection (b)(2), the Sec23 retary shall consider the following factors: 

24 ‘‘(1) The viability of the project without guar25 antees. 


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1 ‘‘(2) The availability of other Federal and State 

2 incentives. 

3 ‘‘(3) The importance of the project in meeting 

4 reliability needs. 

5 ‘‘(4) The effect of the project in meeting a 

6 State or region’s environment (including climate 

7 change) and energy goals. 

8 ‘‘(d) WAGE RATE REQUIREMENTS.—The Secretary 

9 shall require that each recipient of support under this sec10 tion provide reasonable assurance that all laborers and 

11 mechanics employed in the performance of the project for 

12 which the assistance is provided, including those employed 

13 by contractors or subcontractors, will be paid wages at 

14 rates not less than those prevailing on similar work in the 

15 locality as determined by the Secretary of Labor in accord16 ance with subchapter IV of chapter 31 of part A of subtitle 

17 II of title 40, United States Code (commonly referred to 

18 as the ‘Davis-Bacon Act’). 

19 ‘‘(e) SUNSET.—The authority to enter into guaran20 tees under this section shall expire on September 30, 

21 2011.’’. 

22 (b) TABLE OF CONTENTS AMENDMENT.—The table 

23 of contents for the Energy Policy Act of 2005 is amended 

24 by inserting after the item relating to section 1704 the 

25 following new item: 


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‘‘Sec. 1705. Temporary program for rapid deployment of renewable energy and 

electric power transmission projects.’’. 

1 SEC. 2004. WEATHERIZATION ASSISTANCE PROGRAM 

2 AMENDMENTS. 

3 (a) INCOME LEVEL.—Section 412(7) of the Energy 

4 Conservation and Production Act (42 U.S.C. 6862(7)) is 

5 amended by striking ‘‘150 percent’’ both places it appears 

6 and inserting ‘‘200 percent’’. 

7 (b) ASSISTANCE LEVEL PER DWELLING UNIT.—Sec8 tion 415(c)(1) of the Energy Conservation and Production 

9 Act (42 U.S.C. 6865(c)(1)) is amended by striking 

10 ‘‘$2,500’’ and inserting ‘‘$5,000’’. 

11 (c) EFFECTIVE USE OF FUNDS.—In providing funds 

12 made available by this Act for the Weatherization Assist13 ance Program, the Secretary may encourage States to give 

14 priority to using such funds for the most cost-effective ef15 ficiency activities, which may include insulation of attics, 

16 if, in the Secretary’s view, such use of funds would in17 crease the effectiveness of the program. 

18 SEC. 2005. RENEWABLE ELECTRICITY TRANSMISSION 

19 STUDY. 

20 In completing the 2009 National Electric Trans21 mission Congestion Study, the Secretary of Energy shall 

22 include— 

23 (1) an analysis of the significant potential 

24 sources of renewable energy that are constrained in 


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1 accessing appropriate market areas by lack of ade2 quate transmission capacity; 

3 (2) an analysis of the reasons for failure to de4 velop the adequate transmission capacity; 

5 (3) recommendations for achieving adequate 

6 transmission capacity; and 

7 (4) an explanation of assumptions and projec8 tions made in the Study, including— 

9 (A) assumptions and projections relating 

10 to energy efficiency improvements in each load 

11 center; 

12 (B) assumptions and projections regarding 

13 the location and type of projected new genera14 tion capacity; and 

15 (C) assumptions and projections regarding 

16 projected deployment of distributed generation 

17 infrastructure. 

18 Subtitle B—Additional Energy 

19 Provisions 

20 SEC. 2101. ADDITIONAL STATE ENERGY GRANTS. 

21 (a) IN GENERAL.—Amounts appropriated for the 

22 State Energy Program under American Recovery and Re23 investment Act of 2009 shall be available to the Secretary 

24 of Energy for making additional grants under part D of 

25 title III of the Energy Policy and Conservation Act (42 


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1 U.S.C. 6321 et seq.). The Secretary shall make grants 

2 under this section in excess of the base allocation estab3 lished for a State under regulations issued pursuant to 

4 the authorization provided in section 365(f) of such Act 

5 only if the governor of the recipient State notifies the Sec6 retary of Energy that the governor will seek, to the extent 

7 of his or her authority, to ensure that each of the following 

8 will occur: 

9 (1) The applicable State regulatory authority 

10 will implement the following regulatory policies for 

11 each electric and gas utility with respect to which 

12 the State regulatory authority has ratemaking au13 thority: 

14 (A) Policies that ensure that a utility’s re15 covery of prudent fixed costs of service is timely 

16 and independent of its retail sales, without in 

17 the process shifting prudent costs from variable 

18 to fixed charges. This cost shifting constraint 

19 shall not apply to rate designs adopted prior to 

20 the date of enactment of this Act. 

21 (B) Cost recovery for prudent investments 

22 by utilities in energy efficiency. 

23 (C) An earnings opportunity for utilities 

24 associated with cost-effective energy efficiency 

25 savings. 


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1 (2) The State, or the applicable units of local 

2 government that have authority to adopt building 

3 codes, will implement the following: 

4 (A) A building energy code (or codes) for 

5 residential buildings that meets or exceeds the 

6 most recently published International Energy 

7 Conservation Code, or achieves equivalent or 

8 greater energy savings. 

9 (B) A building energy code (or codes) for 

10 commercial buildings throughout the State that 

11 meets or exceeds the ANSI/ASHRAE/IESNA 

12 Standard 90.1–2007, or achieves equivalent or 

13 greater energy savings. 

14 (C) A plan for the jurisdiction achieving 

15 compliance with the building energy code or 

16 codes described in subparagraphs (A) and (B) 

17 within 8 years of the date of enactment of this 

18 Act in at least 90 percent of new and renovated 

19 residential and commercial building space. Such 

20 plan shall include active training and enforce21 ment programs and measurement of the rate of 

22 compliance each year. 

23 (b) STATE MATCH.—The State cost share require24 ment under the item relating to ‘‘DEPARTMENT OF 

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1 ment of the Interior and Related Agencies Appropriations 

2 Act, 1985 (42 U.S.C. 6323a; 98 Stat. 1861) shall not 

3 apply to assistance provided under this section. 

4 (c) EQUIPMENT AND MATERIALS FOR ENERGY EFFI5 CIENCY MEASURES.—No limitation on the percentage of 

6 funding that may be used for the purchase and installation 

7 of equipment and materials for energy efficiency measures 

8 under grants provided under part D of title III of the En9 ergy Policy and Conservation Act (42 U.S.C. 6321 et seq.) 

10 shall apply to assistance provided under this section. 

11 SEC. 2102. INAPPLICABILITY OF LIMITATION. 

12 The limitations in section 399A(f)(2), (3), and (4) 

13 of the Energy Policy and Conservation Act (42 U.S.C. 

14 6371h–1(f)(2), (3), and (4)) shall not apply to grants 

15 funded with appropriations provided by this Act, except 

16 that such grant funds shall be available for not more than 

17 an amount equal to 80 percent of the costs of the project 

18 for which the grant is provided. 


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1 TITLE III—HEALTH INSURANCE 

2 ASSISTANCE FOR THE UNEM3 PLOYED 

4 SEC. 3001. SHORT TITLE AND TABLE OF CONTENTS OF 

5 TITLE. 

6 (a) SHORT TITLE OF TITLE.—This title may be cited 

7 as the ‘‘Health Insurance Assistance for the Unemployed 

8 Act of 2009’’. 

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

10 contents of this title is as follows: 

Sec. 3001. Short title and table of contents of title. 

Sec. 3002. Premium assistance for COBRA benefits and extension of COBRA 

benefits for older or long-term employees. 

Sec. 3003. Temporary optional Medicaid coverage for the unemployed. 

11 SEC. 3002. PREMIUM ASSISTANCE FOR COBRA BENEFITS 

12 AND EXTENSION OF COBRA BENEFITS FOR 

13 OLDER OR LONG-TERM EMPLOYEES. 

14 (a) PREMIUM ASSISTANCE FOR COBRA CONTINU15 ATION COVERAGE FOR INDIVIDUALS AND THEIR FAMI16 LIES.— 

17 (1) PROVISION OF PREMIUM ASSISTANCE.— 

18 (A) REDUCTION OF PREMIUMS PAY19 ABLE.—In the case of any premium for a pe20 riod of coverage beginning on or after the date 

21 of the enactment of this Act for COBRA con22 tinuation coverage with respect to any assist23 ance eligible individual, such individual shall be 


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1 treated for purposes of any COBRA continu2 ation provision as having paid the amount of 

3 such premium if such individual pays 35 per4 cent of the amount of such premium (as deter5 mined without regard to this subsection). 

6 (B) PREMIUM REIMBURSEMENT.—For pro7 visions providing the balance of such premium, 

8 see section 6431 of the Internal Revenue Code 

9 of 1986, as added by paragraph (12). 

10 (2) LIMITATION OF PERIOD OF PREMIUM AS11 SISTANCE.— 

12 (A) IN GENERAL.—Paragraph (1)(A) shall 

13 not apply with respect to any assistance eligible 

14 individual for months of coverage beginning on 

15 or after the earlier of— 

16 (i) the first date that such individual 

17 is eligible for coverage under any other 

18 group health plan (other than coverage 

19 consisting of only dental, vision, coun20 seling, or referral services (or a combina21 tion thereof), coverage under a health re22 imbursement arrangement or a health 

23 flexible spending arrangement, or coverage 

24 of treatment that is furnished in an on-site 

25 medical facility maintained by the emVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 ployer and that consists primarily of first2 aid services, prevention and wellness care, 

3 or similar care (or a combination thereof)) 

4 or is eligible for benefits under title XVIII 

5 of the Social Security Act, or 

6 (ii) the earliest of— 

7 (I) the date which is 12 months 

8 after the first day of first month that 

9 paragraph (1)(A) applies with respect 

10 to such individual, 

11 (II) the date following the expira12 tion of the maximum period of con13 tinuation coverage required under the 

14 applicable COBRA continuation cov15 erage provision, or 

16 (III) the date following the expi17 ration of the period of continuation 

18 coverage allowed under paragraph 

19 (4)(B)(ii). 

20 (B) TIMING OF ELIGIBILITY FOR ADDI21 TIONAL COVERAGE.—For purposes of subpara22 graph (A)(i), an individual shall not be treated 

23 as eligible for coverage under a group health 

24 plan before the first date on which such indi25 vidual could be covered under such plan. 


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1 (C) NOTIFICATION REQUIREMENT.—An 

2 assistance eligible individual shall notify in writ3 ing the group health plan with respect to which 

4 paragraph (1)(A) applies if such paragraph 

5 ceases to apply by reason of subparagraph 

6 (A)(i). Such notice shall be provided to the 

7 group health plan in such time and manner as 

8 may be specified by the Secretary of Labor. 

9 (3) ASSISTANCE ELIGIBLE INDIVIDUAL.—For 

10 purposes of this section, the term ‘‘assistance eligible 

11 individual’’ means any qualified beneficiary if— 

12 (A) at any time during the period that be13 gins with September 1, 2008, and ends with 

14 December 31, 2009, such qualified beneficiary 

15 is eligible for COBRA continuation coverage, 

16 (B) such qualified beneficiary elects such 

17 coverage, and 

18 (C) the qualifying event with respect to the 

19 COBRA continuation coverage consists of the 

20 involuntary termination of the covered employ21 ee’s employment and occurred during such pe22 riod. 

23 (4) EXTENSION OF ELECTION PERIOD AND EF24 FECT ON COVERAGE.— 


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1 (A) IN GENERAL.—Notwithstanding sec2 tion 605(a) of the Employee Retirement Income 

3 Security Act of 1974, section 4980B(f)(5)(A) of 

4 the Internal Revenue Code of 1986, section 

5 2205(a) of the Public Health Service Act, and 

6 section 8905a(c)(2) of title 5, United States 

7 Code, in the case of an individual who is a 

8 qualified beneficiary described in paragraph 

9 (3)(A) as of the date of the enactment of this 

10 Act and has not made the election referred to 

11 in paragraph (3)(B) as of such date, such indi12 vidual may elect the COBRA continuation cov13 erage under the COBRA continuation coverage 

14 provisions containing such sections during the 

15 60-day period commencing with the date on 

16 which the notification required under paragraph 

17 (7)(C) is provided to such individual. 

18 (B) COMMENCEMENT OF COVERAGE; NO

19 REACH-BACK.—Any COBRA continuation cov20 erage elected by a qualified beneficiary during 

21 an extended election period under subparagraph 

22 (A)— 

23 (i) shall commence on the date of the 

24 enactment of this Act, and 


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1 (ii) shall not extend beyond the period 

2 of COBRA continuation coverage that 

3 would have been required under the appli4 cable COBRA continuation coverage provi5 sion if the coverage had been elected as re6 quired under such provision. 

7 (C) PREEXISTING CONDITIONS.—With re8 spect to a qualified beneficiary who elects 

9 COBRA continuation coverage pursuant to sub10 paragraph (A), the period— 

11 (i) beginning on the date of the quali12 fying event, and 

13 (ii) ending with the day before the 

14 date of the enactment of this Act, 

15 shall be disregarded for purposes of deter16 mining the 63-day periods referred to in section 

17 701)(2) of the Employee Retirement Income 

18 Security Act of 1974, section 9801(c)(2) of the 

19 Internal Revenue Code of 1986, and section 

20 2701(c)(2) of the Public Health Service Act. 

21 (5) EXPEDITED REVIEW OF DENIALS OF PRE22 MIUM ASSISTANCE.—In any case in which an indi23 vidual requests treatment as an assistance eligible 

24 individual and is denied such treatment by the group 

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1 bility for COBRA continuation coverage, the Sec2 retary of Labor (or the Secretary of Health and 

3 Human services in connection with COBRA continu4 ation coverage which is provided other than pursu5 ant to part 6 of subtitle B of title I of the Employee 

6 Retirement Income Security Act of 1974), in con7 sultation with the Secretary of the Treasury, shall 

8 provide for expedited review of such denial. An indi9 vidual shall be entitled to such review upon applica10 tion to such Secretary in such form and manner as 

11 shall be provided by such Secretary. Such Secretary 

12 shall make a determination regarding such individ13 ual’s eligibility within 10 business days after receipt 

14 of such individual’s application for review under this 

15 paragraph. 

16 (6) DISREGARD OF SUBSIDIES FOR PURPOSES

17 OF FEDERAL AND STATE PROGRAMS.—Notwith18 standing any other provision of law, any premium 

19 reduction with respect to an assistance eligible indi20 vidual under this subsection shall not be considered 

21 income or resources in determining eligibility for, or 

22 the amount of assistance or benefits provided under, 

23 any other public benefit provided under Federal law 

24 or the law of any State or political subdivision there25 of. 


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1 (7) NOTICES TO INDIVIDUALS.— 

2 (A) GENERAL NOTICE.— 

3 (i) IN GENERAL.—In the case of no4 tices provided under section 606(4) of the 

5 Employee Retirement Income Security Act 

6 of 1974 (29 U.S.C. 1166(4)), section 

7 4980B(f)(6)(D) of the Internal Revenue 

8 Code of 1986, section 2206(4) of the Pub9 lic Health Service Act (42 U.S.C. 300bb– 

10 6(4)), or section 8905a(f)(2)(A) of title 5, 

11 United States Code, with respect to indi12 viduals who, during the period described in 

13 paragraph (3)(A), become entitled to elect 

14 COBRA continuation coverage, such no15 tices shall include an additional notifica16 tion to the recipient of the availability of 

17 premium reduction with respect to such 

18 coverage under this subsection. 

19 (ii) ALTERNATIVE NOTICE.—In the 

20 case of COBRA continuation coverage to 

21 which the notice provision under such sec22 tions does not apply, the Secretary of 

23 Labor, in consultation with the Secretary 

24 of the Treasury and the Secretary of 

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1 ordination with administrators of the 

2 group health plans (or other entities) that 

3 provide or administer the COBRA continu4 ation coverage involved, provide rules re5 quiring the provision of such notice. 

6 (iii) FORM.—The requirement of the 

7 additional notification under this subpara8 graph may be met by amendment of exist9 ing notice forms or by inclusion of a sepa10 rate document with the notice otherwise 

11 required. 

12 (B) SPECIFIC REQUIREMENTS.—Each ad13 ditional notification under subparagraph (A) 

14 shall include— 

15 (i) the forms necessary for estab16 lishing eligibility for premium reduction 

17 under this subsection, 

18 (ii) the name, address, and telephone 

19 number necessary to contact the plan ad20 ministrator and any other person main21 taining relevant information in connection 

22 with such premium reduction, 

23 (iii) a description of the extended elec24 tion period provided for in paragraph 

25 (4)(A), 


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1 (iv) a description of the obligation of 

2 the qualified beneficiary under paragraph 

3 (2)(C) to notify the plan providing continu4 ation coverage of eligibility for subsequent 

5 coverage under another group health plan 

6 or eligibility for benefits under title XVIII 

7 of the Social Security Act and the penalty 

8 provided for failure to so notify the plan, 

9 and 

10 (v) a description, displayed in a 

11 prominent manner, of the qualified bene12 ficiary’s right to a reduced premium and 

13 any conditions on entitlement to the re14 duced premium. 

15 (C) NOTICE RELATING TO RETROACTIVE

16 COVERAGE.—In the case of an individual de17 scribed in paragraph (3)(A) who has elected 

18 COBRA continuation coverage as of the date of 

19 enactment of this Act or an individual described 

20 in paragraph (4)(A), the administrator of the 

21 group health plan (or other entity) involved 

22 shall provide (within 60 days after the date of 

23 enactment of this Act) for the additional notifi24 cation required to be provided under subpara25 graph (A). 


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1 (D) MODEL NOTICES.—Not later than 30 

2 days after the date of enactment of this Act, 

3 the Secretary of the Labor, in consultation with 

4 the Secretary of the Treasury and the Secretary 

5 of Health and Human Services, shall prescribe 

6 models for the additional notification required 

7 under this paragraph. 

8 (8) SAFEGUARDS.—The Secretary of the Treas9 ury shall provide such rules, procedures, regulations, 

10 and other guidance as may be necessary and appro11 priate to prevent fraud and abuse under this sub12 section. 

13 (9) OUTREACH.—The Secretary of Labor, in 

14 consultation with the Secretary of the Treasury and 

15 the Secretary of Health and Human Services, shall 

16 provide outreach consisting of public education and 

17 enrollment assistance relating to premium reduction 

18 provided under this subsection. Such outreach shall 

19 target employers, group health plan administrators, 

20 public assistance programs, States, insurers, and 

21 other entities as determined appropriate by such 

22 Secretaries. Such outreach shall include an initial 

23 focus on those individuals electing continuation cov24 erage who are referred to in paragraph (7)(C). In25 formation on such premium reduction, including enVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00034 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 rollment, shall also be made available on website of 

2 the Departments of Labor, Treasury, and Health 

3 and Human Services. 

4 (10) DEFINITIONS.—For purposes of this sub5 section— 

6 (A) ADMINISTRATOR.—The term ‘‘admin7 istrator’’ has the meaning given such term in 

8 section 3(16) of the Employee Retirement In9 come Security Act of 1974. 

10 (B) COBRA CONTINUATION COVERAGE.— 

11 The term ‘‘COBRA continuation coverage’’ 

12 means continuation coverage provided pursuant 

13 to part 6 of subtitle B of title I of the Em14 ployee Retirement Income Security Act of 1974 

15 (other than under section 609), title XXII of 

16 the Public Health Service Act, section 4980B of 

17 the Internal Revenue Code of 1986 (other than 

18 subsection (f)(1) of such section insofar as it 

19 relates to pediatric vaccines), or section 8905a 

20 of title 5, United States Code, or under a State 

21 program that provides continuation coverage 

22 comparable to such continuation coverage. Such 

23 term does not include coverage under a health 

24 flexible spending arrangement. 


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1 (C) COBRA CONTINUATION PROVISION.— 

2 The term ‘‘COBRA continuation provision’’ 

3 means the provisions of law described in sub4 paragraph (B). 

5 (D) COVERED EMPLOYEE.—The term 

6 ‘‘covered employee’’ has the meaning given such 

7 term in section 607(2) of the Employee Retire8 ment Income Security Act of 1974. 

9 (E) QUALIFIED BENEFICIARY.—The term 

10 ‘‘qualified beneficiary’’ has the meaning given 

11 such term in section 607(3) of the Employee 

12 Retirement Income Security Act of 1974. 

13 (F) GROUP HEALTH PLAN.—The term 

14 ‘‘group health plan’’ has the meaning given 

15 such term in section 607(1) of the Employee 

16 Retirement Income Security Act of 1974. 

17 (G) STATE.—The term ‘‘State’’ includes 

18 the District of Columbia, the Commonwealth of 

19 Puerto Rico, the Virgin Islands, Guam, Amer20 ican Samoa, and the Commonwealth of the 

21 Northern Mariana Islands. 

22 (11) REPORTS.— 

23 (A) INTERIM REPORT.—The Secretary of 

24 the Treasury shall submit an interim report to 

25 the Committee on Education and Labor, the 


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1 Committee on Ways and Means, and the Com2 mittee on Energy and Commerce of the House 

3 of Representatives and the Committee on 

4 Health, Education, Labor, and Pensions and 

5 the Committee on Finance of the Senate re6 garding the premium reduction provided under 

7 this subsection that includes— 

8 (i) the number of individuals provided 

9 such assistance as of the date of the re10 port; and 

11 (ii) the total amount of expenditures 

12 incurred (with administrative expenditures 

13 noted separately) in connection with such 

14 assistance as of the date of the report. 

15 (B) FINAL REPORT.—As soon as prac16 ticable after the last period of COBRA continu17 ation coverage for which premium reduction is 

18 provided under this section, the Secretary of the 

19 Treasury shall submit a final report to each 

20 Committee referred to in subparagraph (A) that 

21 includes— 

22 (i) the number of individuals provided 

23 premium reduction under this section; 


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1 (ii) the average dollar amount 

2 (monthly and annually) of premium reduc3 tions provided to such individuals; and 

4 (iii) the total amount of expenditures 

5 incurred (with administrative expenditures 

6 noted separately) in connection with pre7 mium reduction under this section. 

8 (12) COBRA PREMIUM ASSISTANCE.— 

9 (A) IN GENERAL.—Subchapter B of chap10 ter 65 of the Internal Revenue Code of 1986 is 

11 amended by adding at the end the following 

12 new section: 

13 ‘‘SEC. 6431. COBRA PREMIUM ASSISTANCE. 

14 ‘‘(a) IN GENERAL.—The entity to whom premiums 

15 are payable under COBRA continuation coverage shall be 

16 reimbursed for the amount of premiums not paid by plan 

17 beneficiaries by reason of section 3002(a) of the Health 

18 Insurance Assistance for the Unemployed Act of 2009. 

19 Such amount shall be treated as a credit against the re20 quirement of such entity to make deposits of payroll taxes. 

21 To the extent that such amount exceeds the amount of 

22 such taxes, the Secretary shall pay to such entity the 

23 amount of such excess. No payment may be made under 

24 this subsection to an entity with respect to any assistance 

25 eligible individual until after such entity has received the 


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1 reduced premium from such individual required under sec2 tion 3002(a)(1)(A) of such Act. 

3 ‘‘(b) PAYROLL TAXES.—For purposes of this section, 

4 the term ‘payroll taxes’ means— 

5 ‘‘(1) amounts required to be deducted and with6 held for the payroll period under section 3401 (relat7 ing to wage withholding), 

8 ‘‘(2) amounts required to be deducted for the 

9 payroll period under section 3102 (relating to FICA 

10 employee taxes), and 

11 ‘‘(3) amounts of the taxes imposed for the pay12 roll period under section 3111 (relating to FICA em13 ployer taxes). 

14 ‘‘(c) TREATMENT OF CREDIT.—Except as otherwise 

15 provided by the Secretary, the credit described in sub16 section (a) shall be applied as though the employer had 

17 paid to the Secretary, on the day that the qualified bene18 ficiary’s premium payment is received, an amount equal 

19 to such credit. 

20 ‘‘(d) TREATMENT OF PAYMENT.—For purposes of 

21 section 1324(b)(2) of title 31, United States Code, any 

22 payment under this subsection shall be treated in the same 

23 manner as a refund of the credit under section 35. 

24 ‘‘(e) REPORTING.— 


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1 ‘‘(1) IN GENERAL.—Each entity entitled to re2 imbursement under subsection (a) for any period 

3 shall submit such reports as the Secretary may re4 quire, including— 

5 ‘‘(A) an attestation of involuntary termi6 nation of employment for each covered em7 ployee on the basis of whose termination entitle8 ment to reimbursement is claimed under sub9 section (a), and 

10 ‘‘(B) a report of the amount of payroll 

11 taxes offset under subsection (a) for the report12 ing period and the estimated offsets of such 

13 taxes for the subsequent reporting period in 

14 connection with reimbursements under sub15 section (a). 

16 ‘‘(2) TIMING OF REPORTS RELATING TO

17 AMOUNT OF PAYROLL TAXES.—Reports required 

18 under paragraph (1)(B) shall be submitted at the 

19 same time as deposits of taxes imposed by chapters 

20 21, 22, and 24 or at such time as is specified by the 

21 Secretary. 

22 ‘‘(f) REGULATIONS.—The Secretary may issue such 

23 regulations or other guidance as may be necessary or ap24 propriate to carry out this section, including the require25 ment to report information or the establishment of other 


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1 methods for verifying the correct amounts of payments 

2 and credits under this section.’’. 

3 (B) SOCIAL SECURITY TRUST FUNDS HELD

4 HARMLESS.—In determining any amount trans5 ferred or appropriated to any fund under the 

6 Social Security Act, section 6431 of the Inter7 nal Revenue Code of 1986 shall not be taken 

8 into account. 

9 (C) CLERICAL AMENDMENT.—The table of 

10 sections for subchapter B of chapter 65 of the 

11 Internal Revenue Code of 1986 is amended by 

12 adding at the end the following new item: 

‘‘Sec. 6431. COBRA premium assistance.’’. 

13 (D) EFFECTIVE DATE.—The amendments 

14 made by this paragraph shall apply to pre15 miums to which subsection (a)(1)(A) applies. 

16 (13) PENALTY FOR FAILURE TO NOTIFY

17 HEALTH PLAN OF CESSATION OF ELIGIBILITY FOR

18 PREMIUM ASSISTANCE.— 

19 (A) IN GENERAL.—Part I of subchapter B 

20 of chapter 68 of the Internal Revenue Code of 

21 1986 is amended by adding at the end the fol22 lowing new section: 


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1 ‘‘SEC. 6720C. PENALTY FOR FAILURE TO NOTIFY HEALTH 

2 PLAN OF CESSATION OF ELIGIBILITY FOR 

3 COBRA PREMIUM ASSISTANCE. 

4 ‘‘(a) IN GENERAL.—Any person required to notify a 

5 group health plan under section 3002(a)(2)(C) of the 

6 Health Insurance Assistance for the Unemployed Act of 

7 2009 who fails to make such a notification at such time 

8 and in such manner as the Secretary of Labor may require 

9 shall pay a penalty of 110 percent of the premium reduc10 tion provided under such section after termination of eligi11 bility under such subsection. 

12 ‘‘(b) REASONABLE CAUSE EXCEPTION.—No penalty 

13 shall be imposed under subsection (a) with respect to any 

14 failure if it is shown that such failure is due to reasonable 

15 cause and not to willful neglect.’’. 

16 (B) CLERICAL AMENDMENT.—The table of 

17 sections of part I of subchapter B of chapter 68 

18 of such Code is amended by adding at the end 

19 the following new item: 

‘‘Sec. 6720C. Penalty for failure to notify health plan of cessation of eligibility 

for COBRA premium assistance.’’. 

20 (C) EFFECTIVE DATE.—The amendments 

21 made by this paragraph shall apply to failures 

22 occurring after the date of the enactment of 

23 this Act. 

24 (14) COORDINATION WITH HCTC.— 


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1 (A) IN GENERAL.—Subsection (g) of sec2 tion 35 of the Internal Revenue Code of 1986 

3 is amended by redesignating paragraph (9) as 

4 paragraph (10) and inserting after paragraph 

5 (8) the following new paragraph: 

6 ‘‘(9) COBRA PREMIUM ASSISTANCE.—In the 

7 case of an assistance eligible individual who receives 

8 premium reduction for COBRA continuation cov9 erage under section 3002(a) of the Health Insurance 

10 Assistance for the Unemployed Act of 2009 for any 

11 month during the taxable year, such individual shall 

12 not be treated as an eligible individual, a certified 

13 individual, or a qualifying family member for pur14 poses of this section or section 7527 with respect to 

15 such month.’’. 

16 (B) EFFECTIVE DATE.—The amendment 

17 made by subparagraph (A) shall apply to tax18 able years ending after the date of the enact19 ment of this Act. 

20 (15) EXCLUSION OF COBRA PREMIUM ASSIST21 ANCE FROM GROSS INCOME.— 

22 (A) IN GENERAL.—Part III of subchapter 

23 B of chapter 1 of the Internal Revenue Code of 

24 1986 is amended by inserting after section 

25 139B the following new section: 


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1 ‘‘SEC. 139C. COBRA PREMIUM ASSISTANCE. 

2 ‘‘In the case of an assistance eligible individual (as 

3 defined in section 3002 of the Health Insurance Assist4 ance for the Unemployed Act of 2009), gross income does 

5 not include any premium reduction provided under sub6 section (a) of such section.’’. 

7 (B) CLERICAL AMENDMENT.—The table of 

8 sections for part III of subchapter B of chapter 

9 1 of such Code is amended by inserting after 

10 the item relating to section 139B the following 

11 new item: 

‘‘Sec. 139C. COBRA premium assistance.’’. 

12 (C) EFFECTIVE DATE.—The amendments 

13 made by this paragraph shall apply to taxable 

14 years ending after the date of the enactment of 

15 this Act. 

16 (b) EXTENSION OF COBRA BENEFITS FOR OLDER

17 OR LONG-TERM EMPLOYEES.— 

18 (1) ERISA AMENDMENT.—Section 602(2)(A) 

19 of the Employee Retirement Income Security Act of 

20 1974 is amended by adding at the end the following 

21 new clauses: 

22 ‘‘(x) SPECIAL RULE FOR OLDER OR

23 LONG-TERM EMPLOYEES GENERALLY.—In 

24 the case of a qualifying event described in 

25 section 603(2) with respect to a covered 


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1 employee who (as of such qualifying event) 

2 has attained age 55 or has completed 10 

3 or more years of service with the entity 

4 that is the employer at the time of the 

5 qualifying event, clauses (i) and (ii) shall 

6 not apply. 

7 ‘‘(xi) YEAR OF SERVICE.—For pur8 poses of this subparagraph, the term ‘year 

9 of service’ shall have the meaning provided 

10 in section 202(a)(3).’’. 

11 (2) IRC AMENDMENT.—Clause (i) of section 

12 4980B(f)(2)(B) of the Internal Revenue Code of 

13 1986 is amended by adding at the end the following 

14 new subclauses: 

15 ‘‘(X) SPECIAL RULE FOR OLDER

16 OR LONG-TERM EMPLOYEES GEN17 ERALLY.—In the case of a qualifying 

18 event described in paragraph (3)(B) 

19 with respect to a covered employee 

20 who (as of such qualifying event) has 

21 attained age 55 or has completed 10 

22 or more years of service with the enti23 ty that is the employer at the time of 

24 the qualifying event, subclauses (I) 

25 and (II) shall not apply. 


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1 ‘‘(XI) YEAR OF SERVICE.—For 

2 purposes of this clause, the term ‘year 

3 of service’ shall have the meaning pro4 vided in section 202(a)(3) of the Em5 ployee Retirement Income Security 

6 Act of 1974.’’. 

7 (3) PHSA AMENDMENT.—Section 2202(2)(A) 

8 of the Public Health Service Act is amended by add9 ing at the end the following new clauses: 

10 ‘‘(viii) SPECIAL RULE FOR OLDER OR

11 LONG-TERM EMPLOYEES GENERALLY.—In 

12 the case of a qualifying event described in 

13 section 2203(2) with respect to a covered 

14 employee who (as of such qualifying event) 

15 has attained age 55 or has completed 10 

16 or more years of service with the entity 

17 that is the employer at the time of the 

18 qualifying event, clauses (i) and (ii) shall 

19 not apply. 

20 ‘‘(ix) YEAR OF SERVICE.—For pur21 poses of this subparagraph, the term ‘year 

22 of service’ shall have the meaning provided 

23 in section 202(a)(3) of the Employee Re24 tirement Income Security Act of 1974.’’. 


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1 (4) EFFECTIVE DATE OF AMENDMENTS.—The 

2 amendments made by this subsection shall apply to 

3 periods of coverage which would (without regard to 

4 the amendments made by this section) end on or 

5 after the date of the enactment of this Act. 

6 SEC. 3003. TEMPORARY OPTIONAL MEDICAID COVERAGE 

7 FOR THE UNEMPLOYED. 

8 (a) IN GENERAL.—Section 1902 of the Social Secu9 rity Act (42 U.S.C. 1396b) is amended— 

10 (1) in subsection (a)(10)(A)(ii)— 

11 (A) by striking ‘‘or’’ at the end of sub12 clause (XVIII); 

13 (B) by adding ‘‘or’’ at the end of subclause 

14 (XIX); and 

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

16 subclause: 

17 ‘‘(XX) who are described in sub18 section (dd)(1) (relating to certain un19 employed individuals and their fami20 lies);’’; and 

21 (2) by adding at the end the following new sub22 section: 

23 ‘‘(dd)(1) Individuals described in this paragraph 

24 are— 

25 ‘‘(A) individuals who— 


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1 ‘‘(i) are within one or more of the cat2 egories described in paragraph (2), as elected 

3 under the State plan; and 

4 ‘‘(ii) meet the applicable requirements of 

5 paragraph (3); and 

6 ‘‘(B) individuals who— 

7 ‘‘(i) are the spouse, or dependent child 

8 under 19 years of age, of an individual de9 scribed in subparagraph (A); and 

10 ‘‘(ii) meet the requirement of paragraph 

11 (3)(B). 

12 ‘‘(2) The categories of individuals described in this 

13 paragraph are each of the following: 

14 ‘‘(A)(i) Individuals who are receiving unemploy15 ment compensation benefits; and 

16 ‘‘(ii) individuals who were receiving, but have 

17 exhausted, unemployment compensation benefits on 

18 or after July 1, 2008. 

19 ‘‘(B) Individuals who are involuntarily unem20 ployed and were involuntarily separated from em21 ployment on or after September 1, 2008, and before 

22 January 1, 2011, whose family gross income does 

23 not exceed a percentage specified by the State (not 

24 to exceed 200 percent) of the income official poverty 

25 line (as defined by the Office of Management and 


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1 Budget, and revised annually in accordance with sec2 tion 673(2) of the Omnibus Budget Reconciliation 

3 Act of 1981) applicable to a family of the size in4 volved, and who, but for subsection 

5 (a)(10)(A)(ii)(XX), are not eligible for medical as6 sistance under this title or health assistance under 

7 title XXI. 

8 ‘‘(C) Individuals who are involuntarily unem9 ployed and were involuntarily separated from em10 ployment on or after September 1, 2008, and before 

11 January 1, 2011, who are members of households 

12 participating in the supplemental nutrition assist13 ance program established under the Food and Nutri14 tion Act of 2008 (7 U.S.C. 2011 et seq), and who, 

15 but for subsection (a)(10)(A)(ii)(XX), are not eligi16 ble for medical assistance under this title or health 

17 assistance under title XXI. 

18 ‘‘(3) The requirements of this paragraph with respect 

19 to an individual are the following: 

20 ‘‘(A) In the case of individuals within a cat21 egory described in subparagraph (A) of paragraph 

22 (2), the individual was involuntarily separated from 

23 employment on or after September 1, 2008, and be24 fore January 1, 2011, or meets such comparable re25 quirement as the Secretary specifies through rule, 


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1 guidance, or otherwise in the case of an individual 

2 who was an independent contractor. 

3 ‘‘(B) The individual is not otherwise covered 

4 under creditable coverage, as defined in section 

5 2701(c) of the Public Health Service Act (42 U.S.C. 

6 300gg(c)), but applied without regard to paragraph 

7 (1)(F) of such section and without regard to cov8 erage provided by reason of the application of sub9 section (a)(10)(A)(ii)(XX). 

10 ‘‘(4)(A) No income or resources test shall be applied 

11 with respect to any category of individuals described in 

12 subparagraph (A) or (C) of paragraph (2) who are eligible 

13 for medical assistance only by reason of the application 

14 of subsection (a)(10)(A)(ii)(XX). 

15 ‘‘(B) Nothing in this subsection shall be construed 

16 to prevent a State from imposing a resource test for the 

17 category of individuals described in paragraph (2)(B). 

18 ‘‘(C) In the case of individuals described in paragraph 

19 (2)(A) or (2)(C), the requirements of subsections (i)(22) 

20 and (x) in section 1903 shall not apply.’’. 

21 (b) 100 PERCENT FEDERAL MATCHING RATE.— 

22 (1) FMAP FOR TIME-LIMITED PERIOD.—The 

23 third sentence of section 1905(b) of such Act (42 

24 U.S.C. 1396d(b)) is amended by inserting before the 

25 period at the end the following: ‘‘and for items and 


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1 services furnished on or after the date of enactment 

2 of this Act and before January 1, 2011, to individ3 uals who are eligible for medical assistance only by 

4 reason of the application of section 

5 1902(a)(10)(A)(ii)(XX)’’. 

6 (2) CERTAIN ENROLLMENT-RELATED ADMINIS7 TRATIVE COSTS.—Notwithstanding any other provi8 sion of law, for purposes of applying section 1903(a) 

9 of the Social Security Act (42 U.S.C. 1396b(a)), 

10 with respect to expenditures incurred on or after the 

11 date of the enactment of this Act and before Janu12 ary 1, 2011, for costs of administration (including 

13 outreach and the modification and operation of eligi14 bility information systems) attributable to eligibility 

15 determination and enrollment of individuals who are 

16 eligible for medical assistance only by reason of the 

17 application of section 1902(a)(10)(A)(ii)(XX) of 

18 such Act, as added by subsection (a)(1), the Federal 

19 matching percentage shall be 100 percent instead of 

20 the matching percentage otherwise applicable. 

21 (c) CONFORMING AMENDMENTS.—(1) Section 

22 1903(f)(4) of such Act (42 U.S.C. 1396c(f)(4)) is amend23 ed by inserting ‘‘1902(a)(10)(A)(ii)(XX), or’’ after 

24 ‘‘1902(a)(10)(A)(ii)(XIX),’’. 


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1 (2) Section 1905(a) of such Act (42 U.S.C. 

2 1396d(a)) is amended, in the matter preceding paragraph 

3 (1)— 

4 (A) by striking ‘‘or’’ at the end of clause (xii); 

5 (B) by adding ‘‘or’’ at the end of clause (xiii); 

6 and 

7 (C) by inserting after clause (xiii) the following 

8 new clause: 

9 ‘‘(xiv) individuals described in section 

10 1902(dd)(1),’’. 

11 TITLE IV—HEALTH 

12 INFORMATION TECHNOLOGY 

13 SEC. 4001. SHORT TITLE; TABLE OF CONTENTS OF TITLE. 

14 (a) SHORT TITLE.—This title may be cited as the 

15 ‘‘Health Information Technology for Economic and Clin16 ical Health Act’’ or the ‘‘HITECH Act’’. 

17 (b) TABLE OF CONTENTS OF TITLE.—The table of 

18 contents of this title is as follows: 

Sec. 4001. Short title; table of contents of title. 

Subtitle A—Promotion of Health Information Technology 

PART I—IMPROVING HEALTH CARE QUALITY, SAFETY, AND EFFICIENCY

Sec. 4101. ONCHIT; standards development and adoption. 

‘‘TITLE XXX—HEALTH INFORMATION TECHNOLOGY AND 

QUALITY 

‘‘Sec. 3000. Definitions. 

‘‘Subtitle A—Promotion of Health Information Technology 

‘‘Sec. 3001. Office of the National Coordinator for Health Information 

Technology. 

‘‘Sec. 3002. HIT Policy Committee. 


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‘‘Sec. 3003. HIT Standards Committee. 

‘‘Sec. 3004. Process for adoption of endorsed recommendations; adoption 

of initial set of standards, implementation specifications, 

and certification criteria. 

‘‘Sec. 3005. Application and use of adopted standards and implementation 

specifications by Federal agencies. 

‘‘Sec. 3006. Voluntary application and use of adopted standards and implementation specifications by private entities. 

‘‘Sec. 3007. Federal health information technology. 

‘‘Sec. 3008. Transitions. 

‘‘Sec. 3009. Relation to HIPAA privacy and security law. 

‘‘Sec. 3010. Authorization for appropriations. 

Sec. 4102. Technical amendment. 

PART II—APPLICATION AND USE OF ADOPTED HEALTH INFORMATION

TECHNOLOGY STANDARDS; REPORTS

Sec. 4111. Coordination of Federal activities with adopted standards and implementation specifications. 

Sec. 4112. Application to private entities. 

Sec. 4113. Study and reports. 

Subtitle B—Testing of Health Information Technology 

Sec. 4201. National Institute for Standards and Technology testing. 

Sec. 4202. Research and development programs. 

Subtitle C—Incentives for the Use of Health Information Technology 

PART I—GRANTS AND LOANS FUNDING

Sec. 4301. Grant, loan, and demonstration programs. 

‘‘Subtitle B—Incentives for the Use of Health Information Technology 

‘‘Sec. 3011. Immediate funding to strengthen the health information technology infrastructure. 

‘‘Sec. 3012. Health information technology implementation assistance. 

‘‘Sec. 3013. State grants to promote health information technology. 

‘‘Sec. 3014. Competitive grants to States and Indian tribes for the development of loan programs to facilitate the widespread 

adoption of certified EHR technology. 

‘‘Sec. 3015. Demonstration program to integrate information technology 

into clinical education. 

‘‘Sec. 3016. Information technology professionals on health care. 

‘‘Sec. 3017. General grant and loan provisions. 

‘‘Sec. 3018. Authorization for appropriations. 

PART II—MEDICARE PROGRAM

Sec. 4311. Incentives for eligible professionals. 

Sec. 4312. Incentives for hospitals. 

Sec. 4313. Treatment of payments and savings; implementation funding. 

Sec. 4314. Study on application of EHR payment incentives for providers not 

receiving other incentive payments. 

PART III—MEDICAID FUNDING


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Sec. 4321. Medicaid provider HIT adoption and operation payments; implementation funding. 

Subtitle D—Privacy 

Sec. 4400. Definitions. 

PART I—IMPROVED PRIVACY PROVISIONS AND SECURITY PROVISIONS

Sec. 4401. Application of security provisions and penalties to business associates of covered entities; annual guidance on security provisions. 

Sec. 4402. Notification in the case of breach. 

Sec. 4403. Education on Health Information Privacy. 

Sec. 4404. Application of privacy provisions and penalties to business associates 

of covered entities. 

Sec. 4405. Restrictions on certain disclosures and sales of health information; 

accounting of certain protected health information disclosures; 

access to certain information in electronic format. 

Sec. 4406. Conditions on certain contacts as part of health care operations. 

Sec. 4407. Temporary breach notification requirement for vendors of personal 

health records and other non-HIPAA covered entities. 

Sec. 4408. Business associate contracts required for certain entities. 

Sec. 4409. Clarification of application of wrongful disclosures criminal penalties. 

Sec. 4410. Improved enforcement. 

Sec. 4411. Audits. 

PART II—RELATIONSHIP TO OTHER LAWS; REGULATORY REFERENCES; 

EFFECTIVE DATE; REPORTS

Sec. 4421. Relationship to other laws. 

Sec. 4422. Regulatory references. 

Sec. 4423. Effective date. 

Sec. 4424. Studies, reports, guidance. 

1 Subtitle A—Promotion of Health 

2 Information Technology 

3 PART I—IMPROVING HEALTH CARE QUALITY, 

4 SAFETY, AND EFFICIENCY 

5 SEC. 4101. ONCHIT; STANDARDS DEVELOPMENT AND ADOP6 TION. 

7 The Public Health Service Act (42 U.S.C. 201 et 

8 seq.) is amended by adding at the end the following: 


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1 ‘‘TITLE XXX—HEALTH INFORMA2 TION TECHNOLOGY AND 

3 QUALITY 

4 ‘‘SEC. 3000. DEFINITIONS. 

5 ‘‘In this title: 

6 ‘‘(1) CERTIFIED EHR TECHNOLOGY.—The term 

7 ‘certified EHR technology’ means a qualified elec8 tronic health record that is certified pursuant to sec9 tion 3001(c)(5) as meeting standards adopted under 

10 section 3004 that are applicable to the type of 

11 record involved (as determined by the Secretary, 

12 such as an ambulatory electronic health record for 

13 office-based physicians or an inpatient hospital elec14 tronic health record for hospitals). 

15 ‘‘(2) ENTERPRISE INTEGRATION.—The term 

16 ‘enterprise integration’ means the electronic linkage 

17 of health care providers, health plans, the govern18 ment, and other interested parties, to enable the 

19 electronic exchange and use of health information 

20 among all the components in the health care infra21 structure in accordance with applicable law, and 

22 such term includes related application protocols and 

23 other related standards. 

24 ‘‘(3) HEALTH CARE PROVIDER.—The term 

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1 ing facility, nursing facility, home health entity or 

2 other long term care facility, health care clinic, Fed3 erally qualified health center, group practice (as de4 fined in section 1877(h)(4) of the Social Security 

5 Act), a pharmacist, a pharmacy, a laboratory, a phy6 sician (as defined in section 1861(r) of the Social 

7 Security Act), a practitioner (as described in section 

8 1842(b)(18)(C) of the Social Security Act), a pro9 vider operated by, or under contract with, the Indian 

10 Health Service or by an Indian tribe (as defined in 

11 the Indian Self-Determination and Education Assist12 ance Act), tribal organization, or urban Indian orga13 nization (as defined in section 4 of the Indian 

14 Health Care Improvement Act), a rural health clinic, 

15 a covered entity under section 340B, an ambulatory 

16 surgical center described in section 1833(i) of the 

17 Social Security Act, and any other category of facil18 ity or clinician determined appropriate by the Sec19 retary. 

20 ‘‘(4) HEALTH INFORMATION.—The term ‘health 

21 information’ has the meaning given such term in 

22 section 1171(4) of the Social Security Act. 

23 ‘‘(5) HEALTH INFORMATION TECHNOLOGY.— 

24 The term ‘health information technology’ means 

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1 lated licenses, intellectual property, upgrades, and 

2 packaged solutions sold as services that are specifi3 cally designed for use by health care entities for the 

4 electronic creation, maintenance, or exchange of 

5 health information. 

6 ‘‘(6) HEALTH PLAN.—The term ‘health plan’ 

7 has the meaning given such term in section 1171(5) 

8 of the Social Security Act. 

9 ‘‘(7) HIT POLICY COMMITTEE.—The term ‘HIT 

10 Policy Committee’ means such Committee estab11 lished under section 3002(a). 

12 ‘‘(8) HIT STANDARDS COMMITTEE.—The term 

13 ‘HIT Standards Committee’ means such Committee 

14 established under section 3003(a). 

15 ‘‘(9) INDIVIDUALLY IDENTIFIABLE HEALTH IN16 FORMATION.—The term ‘individually identifiable 

17 health information’ has the meaning given such term 

18 in section 1171(6) of the Social Security Act. 

19 ‘‘(10) LABORATORY.—The term ‘laboratory’ 

20 has the meaning given such term in section 353(a). 

21 ‘‘(11) NATIONAL COORDINATOR.—The term 

22 ‘National Coordinator’ means the head of the Office 

23 of the National Coordinator for Health Information 

24 Technology established under section 3001(a). 


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1 ‘‘(12) PHARMACIST.—The term ‘pharmacist’ 

2 has the meaning given such term in section 804(2) 

3 of the Federal Food, Drug, and Cosmetic Act. 

4 ‘‘(13) QUALIFIED ELECTRONIC HEALTH

5 RECORD.—The term ‘qualified electronic health 

6 record’ means an electronic record of health-related 

7 information on an individual that— 

8 ‘‘(A) includes patient demographic and 

9 clinical health information, such as medical his10 tory and problem lists; and 

11 ‘‘(B) has the capacity— 

12 ‘‘(i) to provide clinical decision sup13 port; 

14 ‘‘(ii) to support physician order entry; 

15 ‘‘(iii) to capture and query informa16 tion relevant to health care quality; and 

17 ‘‘(iv) to exchange electronic health in18 formation with, and integrate such infor19 mation from other sources. 

20 ‘‘(14) STATE.—The term ‘State’ means each of 

21 the several States, the District of Columbia, Puerto 

22 Rico, the Virgin Islands, Guam, American Samoa, 

23 and the Northern Mariana Islands. 


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1 ‘‘Subtitle A—Promotion of Health 

2 Information Technology 

3 ‘‘SEC. 3001. OFFICE OF THE NATIONAL COORDINATOR FOR 

4 HEALTH INFORMATION TECHNOLOGY. 

5 ‘‘(a) ESTABLISHMENT.—There is established within 

6 the Department of Health and Human Services an Office 

7 of the National Coordinator for Health Information Tech8 nology (referred to in this section as the ‘Office’). The Of9 fice shall be headed by a National Coordinator who shall 

10 be appointed by the Secretary and shall report directly to 

11 the Secretary. 

12 ‘‘(b) PURPOSE.—The National Coordinator shall per13 form the duties under subsection (c) in a manner con14 sistent with the development of a nationwide health infor15 mation technology infrastructure that allows for the elec16 tronic use and exchange of information and that— 

17 ‘‘(1) ensures that each patient’s health informa18 tion is secure and protected, in accordance with ap19 plicable law; 

20 ‘‘(2) improves health care quality, reduces med21 ical errors, and advances the delivery of patient-cen22 tered medical care; 

23 ‘‘(3) reduces health care costs resulting from 

24 inefficiency, medical errors, inappropriate care, du25 plicative care, and incomplete information; 


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1 ‘‘(4) provides appropriate information to help 

2 guide medical decisions at the time and place of 

3 care; 

4 ‘‘(5) ensures the inclusion of meaningful public 

5 input in such development of such infrastructure; 

6 ‘‘(6) improves the coordination of care and in7 formation among hospitals, laboratories, physician 

8 offices, and other entities through an effective infra9 structure for the secure and authorized exchange of 

10 health care information; 

11 ‘‘(7) improves public health activities and facili12 tates the early identification and rapid response to 

13 public health threats and emergencies, including bio14 terror events and infectious disease outbreaks; 

15 ‘‘(8) facilitates health and clinical research and 

16 health care quality; 

17 ‘‘(9) promotes prevention of chronic diseases; 

18 ‘‘(10) promotes a more effective marketplace, 

19 greater competition, greater systems analysis, in20 creased consumer choice, and improved outcomes in 

21 health care services; and 

22 ‘‘(11) improves efforts to reduce health dispari23 ties. 

24 ‘‘(c) DUTIES OF THE NATIONAL COORDINATOR.— 


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1 ‘‘(1) STANDARDS.—The National Coordinator 

2 shall review and determine whether to endorse each 

3 standard, implementation specification, and certifi4 cation criterion for the electronic exchange and use 

5 of health information that is recommended by the 

6 HIT Standards Committee under section 3003 for 

7 purposes of adoption under section 3004. The Coor8 dinator shall make such determination, and report to 

9 the Secretary such determination, not later than 45 

10 days after the date the recommendation is received 

11 by the Coordinator. 

12 ‘‘(2) HIT POLICY COORDINATION.— 

13 ‘‘(A) IN GENERAL.—The National Coordi14 nator shall coordinate health information tech15 nology policy and programs of the Department 

16 with those of other relevant executive branch 

17 agencies with a goal of avoiding duplication of 

18 efforts and of helping to ensure that each agen19 cy undertakes health information technology ac20 tivities primarily within the areas of its greatest 

21 expertise and technical capability and in a man22 ner towards a coordinated national goal. 

23 ‘‘(B) HIT POLICY AND STANDARDS COM24 MITTEES.—The National Coordinator shall be a 

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1 ations of the HIT Policy Committee and the 

2 HIT Standards Committee and shall serve as a 

3 liaison among those two Committees and the 

4 Federal Government. 

5 ‘‘(3) STRATEGIC PLAN.— 

6 ‘‘(A) IN GENERAL.—The National Coordi7 nator shall, in consultation with other appro8 priate Federal agencies (including the National 

9 Institute of Standards and Technology), update 

10 the Federal Health IT Strategic Plan (devel11 oped as of June 3, 2008) to include specific ob12 jectives, milestones, and metrics with respect to 

13 the following: 

14 ‘‘(i) The electronic exchange and use 

15 of health information and the enterprise 

16 integration of such information. 

17 ‘‘(ii) The utilization of an electronic 

18 health record for each person in the United 

19 States by 2014. 

20 ‘‘(iii) The incorporation of privacy and 

21 security protections for the electronic ex22 change of an individual’s individually iden23 tifiable health information. 

24 ‘‘(iv) Ensuring security methods to 

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1 tronic authentication of health information 

2 and specifying technologies or methodolo3 gies for rendering health information unus4 able, unreadable, or indecipherable. 

5 ‘‘(v) Specifying a framework for co6 ordination and flow of recommendations 

7 and policies under this subtitle among the 

8 Secretary, the National Coordinator, the 

9 HIT Policy Committee, the HIT Standards 

10 Committee, and other health information 

11 exchanges and other relevant entities. 

12 ‘‘(vi) Methods to foster the public un13 derstanding of health information tech14 nology. 

15 ‘‘(vii) Strategies to enhance the use of 

16 health information technology in improving 

17 the quality of health care, reducing medical 

18 errors, reducing health disparities, improv19 ing public health, and improving the con20 tinuity of care among health care settings. 

21 ‘‘(B) COLLABORATION.—The strategic 

22 plan shall be updated through collaboration of 

23 public and private entities. 


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1 ‘‘(C) MEASURABLE OUTCOME GOALS.— 

2 The strategic plan update shall include measur3 able outcome goals. 

4 ‘‘(D) PUBLICATION.—The National Coor5 dinator shall republish the strategic plan, in6 cluding all updates. 

7 ‘‘(4) WEBSITE.—The National Coordinator 

8 shall maintain and frequently update an Internet 

9 website on which there is posted information on the 

10 work, schedules, reports, recommendations, and 

11 other information to ensure transparency in pro12 motion of a nationwide health information tech13 nology infrastructure. 

14 ‘‘(5) CERTIFICATION.— 

15 ‘‘(A) IN GENERAL.—The National Coordi16 nator, in consultation with the Director of the 

17 National Institute of Standards and Tech18 nology, shall develop a program (either directly 

19 or by contract) for the voluntary certification of 

20 health information technology as being in com21 pliance with applicable certification criteria 

22 adopted under this subtitle. Such program shall 

23 include testing of the technology in accordance 

24 with section 4201(b) of the HITECH Act. 


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1 ‘‘(B) CERTIFICATION CRITERIA DE2 SCRIBED.—In this title, the term ‘certification 

3 criteria’ means, with respect to standards and 

4 implementation specifications for health infor5 mation technology, criteria to establish that the 

6 technology meets such standards and implemen7 tation specifications. 

8 ‘‘(6) REPORTS AND PUBLICATIONS.— 

9 ‘‘(A) REPORT ON ADDITIONAL FUNDING

10 OR AUTHORITY NEEDED.—Not later than 12 

11 months after the date of the enactment of this 

12 title, the National Coordinator shall submit to 

13 the appropriate committees of jurisdiction of 

14 the House of Representatives and the Senate a 

15 report on any additional funding or authority 

16 the Coordinator or the HIT Policy Committee 

17 or HIT Standards Committee requires to evalu18 ate and develop standards, implementation 

19 specifications, and certification criteria, or to 

20 achieve full participation of stakeholders in the 

21 adoption of a nationwide health information 

22 technology infrastructure that allows for the 

23 electronic use and exchange of health informa24 tion. 


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1 ‘‘(B) IMPLEMENTATION REPORT.—The 

2 National Coordinator shall prepare a report 

3 that identifies lessons learned from major pub4 lic and private health care systems in their im5 plementation of health information technology, 

6 including information on whether the tech7 nologies and practices developed by such sys8 tems may be applicable to and usable in whole 

9 or in part by other health care providers. 

10 ‘‘(C) ASSESSMENT OF IMPACT OF HIT ON

11 COMMUNITIES WITH HEALTH DISPARITIES AND

12 UNINSURED, UNDERINSURED, AND MEDICALLY

13 UNDERSERVED AREAS.—The National Coordi14 nator shall assess and publish the impact of 

15 health information technology in communities 

16 with health disparities and in areas with a high 

17 proportion of individuals who are uninsured, 

18 underinsured, and medically underserved indi19 viduals (including urban and rural areas) and 

20 identify practices to increase the adoption of 

21 such technology by health care providers in 

22 such communities. 

23 ‘‘(D) EVALUATION OF BENEFITS AND

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1 tional Coordinator shall evaluate and publish 

2 evidence on the benefits and costs of the elec3 tronic use and exchange of health information 

4 and assess to whom these benefits and costs ac5 crue. 

6 ‘‘(E) RESOURCE REQUIREMENTS.—The 

7 National Coordinator shall estimate and publish 

8 resources required annually to reach the goal of 

9 utilization of an electronic health record for 

10 each person in the United States by 2014, in11 cluding the required level of Federal funding, 

12 expectations for regional, State, and private in13 vestment, and the expected contributions by vol14 unteers to activities for the utilization of such 

15 records. 

16 ‘‘(7) ASSISTANCE.—The National Coordinator 

17 may provide financial assistance to consumer advo18 cacy groups and not-for-profit entities that work in 

19 the public interest for purposes of defraying the cost 

20 to such groups and entities to participate under, 

21 whether in whole or in part, the National Tech22 nology Transfer Act of 1995 (15 U.S.C. 272 note). 

23 ‘‘(8) GOVERNANCE FOR NATIONWIDE HEALTH

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1 nator shall establish a governance mechanism for the 

2 nationwide health information network. 

3 ‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— 

4 ‘‘(1) IN GENERAL.—Upon the request of the 

5 National Coordinator, the head of any Federal agen6 cy is authorized to detail, with or without reimburse7 ment from the Office, any of the personnel of such 

8 agency to the Office to assist it in carrying out its 

9 duties under this section. 

10 ‘‘(2) EFFECT OF DETAIL.—Any detail of per11 sonnel under paragraph (1) shall— 

12 ‘‘(A) not interrupt or otherwise affect the 

13 civil service status or privileges of the Federal 

14 employee; and 

15 ‘‘(B) be in addition to any other staff of 

16 the Department employed by the National Co17 ordinator. 

18 ‘‘(3) ACCEPTANCE OF DETAILEES.—Notwith19 standing any other provision of law, the Office may 

20 accept detailed personnel from other Federal agen21 cies without regard to whether the agency described 

22 under paragraph (1) is reimbursed. 

23 ‘‘(e) CHIEF PRIVACY OFFICER OF THE OFFICE OF

24 THE NATIONAL COORDINATOR.—Not later than 12 

25 months after the date of the enactment of this title, the 


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1 Secretary shall appoint a Chief Privacy Officer of the Of2 fice of the National Coordinator, whose duty it shall be 

3 to advise the National Coordinator on privacy, security, 

4 and data stewardship of electronic health information and 

5 to coordinate with other Federal agencies (and similar pri6 vacy officers in such agencies), with State and regional 

7 efforts, and with foreign countries with regard to the pri8 vacy, security, and data stewardship of electronic individ9 ually identifiable health information. 

10 ‘‘SEC. 3002. HIT POLICY COMMITTEE. 

11 ‘‘(a) ESTABLISHMENT.—There is established a HIT 

12 Policy Committee to make policy recommendations to the 

13 National Coordinator relating to the implementation of a 

14 nationwide health information technology infrastructure, 

15 including implementation of the strategic plan described 

16 in section 3001(c)(3). 

17 ‘‘(b) DUTIES.— 

18 ‘‘(1) RECOMMENDATIONS ON HEALTH INFOR19 MATION TECHNOLOGY INFRASTRUCTURE.—The HIT 

20 Policy Committee shall recommend a policy frame21 work for the development and adoption of a nation22 wide health information technology infrastructure 

23 that permits the electronic exchange and use of 

24 health information as is consistent with the strategic 

25 plan under section 3001(c)(3) and that includes the 


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1 recommendations under paragraph (2). The Com2 mittee shall update such recommendations and make 

3 new recommendations as appropriate. 

4 ‘‘(2) SPECIFIC AREAS OF STANDARD DEVELOP5 MENT.— 

6 ‘‘(A) IN GENERAL.—The HIT Policy Com7 mittee shall recommend the areas in which 

8 standards, implementation specifications, and 

9 certification criteria are needed for the elec10 tronic exchange and use of health information 

11 for purposes of adoption under section 3004 

12 and shall recommend an order of priority for 

13 the development, harmonization, and recogni14 tion of such standards, specifications, and cer15 tification criteria among the areas so rec16 ommended. Such standards and implementation 

17 specifications shall include named standards, 

18 architectures, and software schemes for the au19 thentication and security of individually identifi20 able health information and other information 

21 as needed to ensure the reproducible develop22 ment of common solutions across disparate en23 tities. 

24 ‘‘(B) AREAS REQUIRED FOR CONSIDER25 ATION.—For purposes of subparagraph (A), the 


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1 HIT Policy Committee shall make recommenda2 tions for at least the following areas: 

3 ‘‘(i) Technologies that protect the pri4 vacy of health information and promote se5 curity in a qualified electronic health 

6 record, including for the segmentation and 

7 protection from disclosure of specific and 

8 sensitive individually identifiable health in9 formation with the goal of minimizing the 

10 reluctance of patients to seek care (or dis11 close information about a condition) be12 cause of privacy concerns, in accordance 

13 with applicable law, and for the use and 

14 disclosure of limited data sets of such in15 formation. 

16 ‘‘(ii) A nationwide health information 

17 technology infrastructure that allows for 

18 the electronic use and accurate exchange of 

19 health information. 

20 ‘‘(iii) The utilization of a certified 

21 electronic health record for each person in 

22 the United States by 2014. 

23 ‘‘(iv) Technologies that as a part of a 

24 qualified electronic health record allow for 

25 an accounting of disclosures made by a 


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1 covered entity (as defined for purposes of 

2 regulations promulgated under section 

3 264(c) of the Health Insurance Portability 

4 and Accountability Act of 1996) for pur5 poses of treatment, payment, and health 

6 care operations (as such terms are defined 

7 for purposes of such regulations). 

8 ‘‘(v) The use of certified electronic 

9 health records to improve the quality of 

10 health care, such as by promoting the co11 ordination of health care and improving 

12 continuity of health care among health 

13 care providers, by reducing medical errors, 

14 by improving population health, and by ad15 vancing research and education. 

16 ‘‘(C) OTHER AREAS FOR CONSIDER17 ATION.—In making recommendations under 

18 subparagraph (A), the HIT Policy Committee 

19 may consider the following additional areas: 

20 ‘‘(i) The appropriate uses of a nation21 wide health information infrastructure, in22 cluding for purposes of— 

23 ‘‘(I) the collection of quality data 

24 and public reporting; 


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1 ‘‘(II) biosurveillance and public 

2 health; 

3 ‘‘(III) medical and clinical re4 search; and 

5 ‘‘(IV) drug safety. 

6 ‘‘(ii) Self-service technologies that fa7 cilitate the use and exchange of patient in8 formation and reduce wait times. 

9 ‘‘(iii) Telemedicine technologies, in 

10 order to reduce travel requirements for pa11 tients in remote areas. 

12 ‘‘(iv) Technologies that facilitate home 

13 health care and the monitoring of patients 

14 recuperating at home. 

15 ‘‘(v) Technologies that help reduce 

16 medical errors. 

17 ‘‘(vi) Technologies that facilitate the 

18 continuity of care among health settings. 

19 ‘‘(vii) Technologies that meet the 

20 needs of diverse populations. 

21 ‘‘(viii) Any other technology that the 

22 HIT Policy Committee finds to be among 

23 the technologies with the greatest potential 

24 to improve the quality and efficiency of 

25 health care. 


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1 ‘‘(3) FORUM.—The HIT Policy Committee shall 

2 serve as a forum for broad stakeholder input with 

3 specific expertise in policies relating to the matters 

4 described in paragraphs (1) and (2). 

5 ‘‘(c) MEMBERSHIP AND OPERATIONS.— 

6 ‘‘(1) IN GENERAL.—The National Coordinator 

7 shall provide leadership in the establishment and op8 erations of the HIT Policy Committee. 

9 ‘‘(2) MEMBERSHIP.—The membership of the 

10 HIT Policy Committee shall at least reflect pro11 viders, ancillary healthcare workers, consumers, pur12 chasers, health plans, technology vendors, research13 ers, relevant Federal agencies, and individuals with 

14 technical expertise on health care quality, privacy 

15 and security, and on the electronic exchange and use 

16 of health information. 

17 ‘‘(3) CONSIDERATION.—The National Coordi18 nator shall ensure that the relevant recommenda19 tions and comments from the National Committee 

20 on Vital and Health Statistics are considered in the 

21 development of policies. 

22 ‘‘(d) APPLICATION OF FACA.—The Federal Advisory 

23 Committee Act (5 U.S.C. App.), other than section 14 of 

24 such Act, shall apply to the HIT Policy Committee. 


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1 ‘‘(e) PUBLICATION.—The Secretary shall provide for 

2 publication in the Federal Register and the posting on the 

3 Internet website of the Office of the National Coordinator 

4 for Health Information Technology of all policy rec5 ommendations made by the HIT Policy Committee under 

6 this section. 

7 ‘‘SEC. 3003. HIT STANDARDS COMMITTEE. 

8 ‘‘(a) ESTABLISHMENT.—There is established a com9 mittee to be known as the HIT Standards Committee to 

10 recommend to the National Coordinator standards, imple11 mentation specifications, and certification criteria for the 

12 electronic exchange and use of health information for pur13 poses of adoption under section 3004, consistent with the 

14 implementation of the strategic plan described in section 

15 3001(c)(3) and beginning with the areas listed in section 

16 3002(b)(2)(B) in accordance with policies developed by 

17 the HIT Policy Committee. 

18 ‘‘(b) DUTIES.— 

19 ‘‘(1) STANDARDS DEVELOPMENT.— 

20 ‘‘(A) IN GENERAL.—The HIT Standards 

21 Committee shall recommend to the National 

22 Coordinator standards, implementation speci23 fications, and certification criteria described in 

24 subsection (a) that have been developed, har25 monized, or recognized by the HIT Standards 


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1 Committee. The HIT Standards Committee 

2 shall update such recommendations and make 

3 new recommendations as appropriate, including 

4 in response to a notification sent under section 

5 3004(b)(2). Such recommendations shall be 

6 consistent with the latest recommendations 

7 made by the HIT Policy Committee. 

8 ‘‘(B) PILOT TESTING OF STANDARDS AND

9 IMPLEMENTATION SPECIFICATIONS.—In the de10 velopment, harmonization, or recognition of 

11 standards and implementation specifications, 

12 the HIT Standards Committee shall, as appro13 priate, provide for the testing of such standards 

14 and specifications by the National Institute for 

15 Standards and Technology under section 4201 

16 of the HITECH Act. 

17 ‘‘(C) CONSISTENCY.—The standards, im18 plementation specifications, and certification 

19 criteria recommended under this subsection 

20 shall be consistent with the standards for infor21 mation transactions and data elements adopted 

22 pursuant to section 1173 of the Social Security 

23 Act. 

24 ‘‘(2) FORUM.—The HIT Standards Committee 

25 shall serve as a forum for the participation of a 


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1 broad range of stakeholders to provide input on the 

2 development, harmonization, and recognition of 

3 standards, implementation specifications, and certifi4 cation criteria necessary for the development and 

5 adoption of a nationwide health information tech6 nology infrastructure that allows for the electronic 

7 use and exchange of health information. 

8 ‘‘(3) SCHEDULE.—Not later than 90 days after 

9 the date of the enactment of this title, the HIT 

10 Standards Committee shall develop a schedule for 

11 the assessment of policy recommendations developed 

12 by the HIT Policy Committee under section 3002. 

13 The HIT Standards Committee shall update such 

14 schedule annually. The Secretary shall publish such 

15 schedule in the Federal Register. 

16 ‘‘(4) PUBLIC INPUT.—The HIT Standards 

17 Committee shall conduct open public meetings and 

18 develop a process to allow for public comment on the 

19 schedule described in paragraph (3) and rec20 ommendations described in this subsection. Under 

21 such process comments shall be submitted in a time22 ly manner after the date of publication of a rec23 ommendation under this subsection. 

24 ‘‘(c) MEMBERSHIP AND OPERATIONS.— 


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1 ‘‘(1) IN GENERAL.—The National Coordinator 

2 shall provide leadership in the establishment and op3 erations of the HIT Standards Committee. 

4 ‘‘(2) MEMBERSHIP.—The membership of the 

5 HIT Standards Committee shall at least reflect pro6 viders, ancillary healthcare workers, consumers, pur7 chasers, health plans, technology vendors, research8 ers, relevant Federal agencies, and individuals with 

9 technical expertise on health care quality, privacy 

10 and security, and on the electronic exchange and use 

11 of health information. 

12 ‘‘(3) CONSIDERATION.—The National Coordi13 nator shall ensure that the relevant recommenda14 tions and comments from the National Committee 

15 on Vital and Health Statistics are considered in the 

16 development of standards. 

17 ‘‘(4) ASSISTANCE.—For the purposes of car18 rying out this section, the Secretary may provide or 

19 ensure that financial assistance is provided by the 

20 HIT Standards Committee to defray in whole or in 

21 part any membership fees or dues charged by such 

22 Committee to those consumer advocacy groups and 

23 not for profit entities that work in the public inter24 est as a part of their mission. 


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1 ‘‘(d) APPLICATION OF FACA.—The Federal Advisory 

2 Committee Act (5 U.S.C. App.), other than section 14, 

3 shall apply to the HIT Standards Committee. 

4 ‘‘(e) PUBLICATION.—The Secretary shall provide for 

5 publication in the Federal Register and the posting on the 

6 Internet website of the Office of the National Coordinator 

7 for Health Information Technology of all recommenda8 tions made by the HIT Standards Committee under this 

9 section. 

10 ‘‘SEC. 3004. PROCESS FOR ADOPTION OF ENDORSED REC11 OMMENDATIONS; ADOPTION OF INITIAL SET 

12 OF STANDARDS, IMPLEMENTATION SPECI13 FICATIONS, AND CERTIFICATION CRITERIA. 

14 ‘‘(a) PROCESS FOR ADOPTION OF ENDORSED REC15 OMMENDATIONS.— 

16 ‘‘(1) REVIEW OF ENDORSED STANDARDS, IM17 PLEMENTATION SPECIFICATIONS, AND CERTIFI18 CATION CRITERIA.—Not later than 90 days after the 

19 date of receipt of standards, implementation speci20 fications, or certification criteria endorsed under sec21 tion 3001(c), the Secretary, in consultation with rep22 resentatives of other relevant Federal agencies, shall 

23 jointly review such standards, implementation speci24 fications, or certification criteria and shall determine 

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1 ards, implementation specifications, or certification 

2 criteria. 

3 ‘‘(2) DETERMINATION TO ADOPT STANDARDS, 

4 IMPLEMENTATION SPECIFICATIONS, AND CERTIFI5 CATION CRITERIA.—If the Secretary determines— 

6 ‘‘(A) to propose adoption of any grouping 

7 of such standards, implementation specifica8 tions, or certification criteria, the Secretary 

9 shall, by regulation, determine whether or not 

10 to adopt such grouping of standards, implemen11 tation specifications, or certification criteria; or 

12 ‘‘(B) not to propose adoption of any group13 ing of standards, implementation specifications, 

14 or certification criteria, the Secretary shall no15 tify the National Coordinator and the HIT 

16 Standards Committee in writing of such deter17 mination and the reasons for not proposing the 

18 adoption of such recommendation. 

19 ‘‘(3) PUBLICATION.—The Secretary shall pro20 vide for publication in the Federal Register of all de21 terminations made by the Secretary under para22 graph (1). 

23 ‘‘(b) ADOPTION OF INITIAL SET OF STANDARDS, IM24 PLEMENTATION SPECIFICATIONS, AND CERTIFICATION

25 CRITERIA.— 


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1 ‘‘(1) IN GENERAL.—Not later than December 

2 31, 2009, the Secretary shall, through the rule3 making process described in section 3003, adopt an 

4 initial set of standards, implementation specifica5 tions, and certification criteria for the areas required 

6 for consideration under section 3002(b)(2)(B). 

7 ‘‘(2) APPLICATION OF CURRENT STANDARDS, 

8 IMPLEMENTATION SPECIFICATIONS, AND CERTIFI9 CATION CRITERIA.—The standards, implementation 

10 specifications, and certification criteria adopted be11 fore the date of the enactment of this title through 

12 the process existing through the Office of the Na13 tional Coordinator for Health Information Tech14 nology may be applied towards meeting the require15 ment of paragraph (1). 

16 ‘‘SEC. 3005. APPLICATION AND USE OF ADOPTED STAND17 ARDS AND IMPLEMENTATION SPECIFICA18 TIONS BY FEDERAL AGENCIES. 

19 ‘‘For requirements relating to the application and use 

20 by Federal agencies of the standards and implementation 

21 specifications adopted under section 3004, see section 

22 4111 of the HITECH Act. 


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1 ‘‘SEC. 3006. VOLUNTARY APPLICATION AND USE OF ADOPT2 ED STANDARDS AND IMPLEMENTATION 

3 SPECIFICATIONS BY PRIVATE ENTITIES. 

4 ‘‘(a) IN GENERAL.—Except as provided under section 

5 4112 of the HITECH Act, any standard or implementa6 tion specification adopted under section 3004 shall be vol7 untary with respect to private entities. 

8 ‘‘(b) RULE OF CONSTRUCTION.—Nothing in this sub9 title shall be construed to require that a private entity that 

10 enters into a contract with the Federal Government apply 

11 or use the standards and implementation specifications 

12 adopted under section 3004 with respect to activities not 

13 related to the contract. 

14 ‘‘SEC. 3007. FEDERAL HEALTH INFORMATION TECH15 NOLOGY. 

16 ‘‘(a) IN GENERAL.—The National Coordinator shall 

17 support the development, routine updating, and provision 

18 of qualified EHR technology (as defined in section 3000) 

19 consistent with subsections (b) and (c) unless the Sec20 retary determines that the needs and demands of pro21 viders are being substantially and adequately met through 

22 the marketplace. 

23 ‘‘(b) CERTIFICATION.—In making such EHR tech24 nology publicly available, the National Coordinator shall 

25 ensure that the qualified EHR technology described in 

26 subsection (a) is certified under the program developed 


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1 under section 3001(c)(3) to be in compliance with applica2 ble standards adopted under section 3003(a). 

3 ‘‘(c) AUTHORIZATION TO CHARGE A NOMINAL

4 FEE.—The National Coordinator may impose a nominal 

5 fee for the adoption by a health care provider of the health 

6 information technology system developed or approved 

7 under subsection (a) and (b). Such fee shall take into ac8 count the financial circumstances of smaller providers, low 

9 income providers, and providers located in rural or other 

10 medically underserved areas. 

11 ‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec12 tion shall be construed to require that a private or govern13 ment entity adopt or use the technology provided under 

14 this section. 

15 ‘‘SEC. 3008. TRANSITIONS. 

16 ‘‘(a) ONCHIT.—To the extent consistent with sec17 tion 3001, all functions, personnel, assets, liabilities, and 

18 administrative actions applicable to the National Coordi19 nator for Health Information Technology appointed under 

20 Executive Order 13335 or the Office of such National Co21 ordinator on the date before the date of the enactment 

22 of this title shall be transferred to the National Coordi23 nator appointed under section 3001(a) and the Office of 

24 such National Coordinator as of the date of the enactment 

25 of this title. 


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1 ‘‘(b) AHIC.— 

2 ‘‘(1) To the extent consistent with sections 

3 3002 and 3003, all functions, personnel, assets, and 

4 liabilities applicable to the AHIC Successor, Inc. 

5 doing business as the National eHealth Collaborative 

6 as of the day before the date of the enactment of 

7 this title shall be transferred to the HIT Policy 

8 Committee or the HIT Standards Committee, estab9 lished under section 3002(a) or 3003(a), as appro10 priate, as of the date of the enactment of this title. 

11 ‘‘(2) In carrying out section 3003(b)(1)(A), 

12 until recommendations are made by the HIT Policy 

13 Committee, recommendations of the HIT Standards 

14 Committee shall be consistent with the most recent 

15 recommendations made by such AHIC Successor, 

16 Inc. 

17 ‘‘(c) RULES OF CONSTRUCTION.— 

18 ‘‘(1) ONCHIT.—Nothing in section 3001 or 

19 subsection (a) shall be construed as requiring the 

20 creation of a new entity to the extent that the Office 

21 of the National Coordinator for Health Information 

22 Technology established pursuant to Executive Order 

23 13335 is consistent with the provisions of section 

24 3001. 


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1 ‘‘(2) AHIC.—Nothing in sections 3002 or 3003 

2 or subsection (b) shall be construed as prohibiting 

3 the AHIC Successor, Inc. doing business as the Na4 tional eHealth Collaborative from modifying its char5 ter, duties, membership, and any other structure or 

6 function required to be consistent with section 3002 

7 and 3003 in a manner that would permit the Sec8 retary to choose to recognize such AHIC Successor, 

9 Inc. as the HIT Policy Committee or the HIT 

10 Standards Committee. 

11 ‘‘SEC. 3009. RELATION TO HIPAA PRIVACY AND SECURITY 

12 LAW. 

13 ‘‘(a) IN GENERAL.—With respect to the relation of 

14 this title to HIPAA privacy and security law: 

15 ‘‘(1) This title may not be construed as having 

16 any effect on the authorities of the Secretary under 

17 HIPAA privacy and security law. 

18 ‘‘(2) The purposes of this title include ensuring 

19 that the health information technology standards 

20 and implementation specifications adopted under 

21 section 3004 take into account the requirements of 

22 HIPAA privacy and security law. 

23 ‘‘(b) DEFINITION.—For purposes of this section, the 

24 term ‘HIPAA privacy and security law’ means— 


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1 ‘‘(1) the provisions of part C of title XI of the 

2 Social Security Act, section 264 of the Health Insur3 ance Portability and Accountability Act of 1996, and 

4 subtitle D of title IV of the HITECH Act; and 

5 ‘‘(2) regulations under such provisions. 

6 ‘‘SEC. 3010. AUTHORIZATION FOR APPROPRIATIONS. 

7 ‘‘There is authorized to be appropriated to the Office 

8 of the National Coordinator for Health Information Tech9 nology to carry out this subtitle $250,000,000 for fiscal 

10 year 2009.’’. 

11 SEC. 4102. TECHNICAL AMENDMENT. 

12 Section 1171(5) of the Social Security Act (42 U.S.C. 

13 1320d) is amended by striking ‘‘or C’’ and inserting ‘‘C, 

14 or D’’. 

15 PART II—APPLICATION AND USE OF ADOPTED 

16 HEALTH INFORMATION TECHNOLOGY 

17 STANDARDS; REPORTS 

18 SEC. 4111. COORDINATION OF FEDERAL ACTIVITIES WITH 

19 ADOPTED STANDARDS AND IMPLEMENTA20 TION SPECIFICATIONS. 

21 (a) SPENDING ON HEALTH INFORMATION TECH22 NOLOGY SYSTEMS.—As each agency (as defined in the Ex23 ecutive Order issued on August 22, 2006, relating to pro24 moting quality and efficient health care in Federal govern25 ment administered or sponsored health care programs) imVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00086 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 plements, acquires, or upgrades health information tech2 nology systems used for the direct exchange of individually 

3 identifiable health information between agencies and with 

4 non-Federal entities, it shall utilize, where available, 

5 health information technology systems and products that 

6 meet standards and implementation specifications adopted 

7 under section 3004 of the Public Health Service Act, as 

8 added by section 4101. 

9 (b) FEDERAL INFORMATION COLLECTION ACTIVI10 TIES.—With respect to a standard or implementation 

11 specification adopted under section 3004 of the Public 

12 Health Service Act, as added by section 4101, the Presi13 dent shall take measures to ensure that Federal activities 

14 involving the broad collection and submission of health in15 formation are consistent with such standard or implemen16 tation specification, respectively, within three years after 

17 the date of such adoption. 

18 (c) APPLICATION OF DEFINITIONS.—The definitions 

19 contained in section 3000 of the Public Health Service 

20 Act, as added by section 4101, shall apply for purposes 

21 of this part. 

22 SEC. 4112. APPLICATION TO PRIVATE ENTITIES. 

23 Each agency (as defined in such Executive Order 

24 issued on August 22, 2006, relating to promoting quality 

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1 tered or sponsored health care programs) shall require in 

2 contracts or agreements with health care providers, health 

3 plans, or health insurance issuers that as each provider, 

4 plan, or issuer implements, acquires, or upgrades health 

5 information technology systems, it shall utilize, where 

6 available, health information technology systems and prod7 ucts that meet standards and implementation specifica8 tions adopted under section 3004 of the Public Health 

9 Service Act, as added by section 4101. 

10 SEC. 4113. STUDY AND REPORTS. 

11 (a) REPORT ON ADOPTION OF NATIONWIDE SYS12 TEM.—Not later than 2 years after the date of the enact13 ment of this Act and annually thereafter, the Secretary 

14 of Health and Human Services shall submit to the appro15 priate committees of jurisdiction of the House of Rep16 resentatives and the Senate a report that— 

17 (1) describes the specific actions that have been 

18 taken by the Federal Government and private enti19 ties to facilitate the adoption of a nationwide system 

20 for the electronic use and exchange of health infor21 mation; 

22 (2) describes barriers to the adoption of such a 

23 nationwide system; and 

24 (3) contains recommendations to achieve full 

25 implementation of such a nationwide system. 


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1 (b) REIMBURSEMENT INCENTIVE STUDY AND RE2 PORT.— 

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

4 Human Services shall carry out, or contract with a 

5 private entity to carry out, a study that examines 

6 methods to create efficient reimbursement incentives 

7 for improving health care quality in Federally quali8 fied health centers, rural health clinics, and free 

9 clinics. 

10 (2) REPORT.—Not later than 2 years after the 

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

12 Health and Human Services shall submit to the ap13 propriate committees of jurisdiction of the House of 

14 Representatives and the Senate a report on the 

15 study carried out under paragraph (1). 

16 (c) AGING SERVICES TECHNOLOGY STUDY AND RE17 PORT.— 

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

19 Human Services shall carry out, or contract with a 

20 private entity to carry out, a study of matters relat21 ing to the potential use of new aging services tech22 nology to assist seniors, individuals with disabilities, 

23 and their caregivers throughout the aging process. 

24 (2) MATTERS TO BE STUDIED.—The study 

25 under paragraph (1) shall include— 


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1 (A) an evaluation of— 

2 (i) methods for identifying current, 

3 emerging, and future health technology 

4 that can be used to meet the needs of sen5 iors and individuals with disabilities and 

6 their caregivers across all aging services 

7 settings, as specified by the Secretary; 

8 (ii) methods for fostering scientific in9 novation with respect to aging services 

10 technology within the business and aca11 demic communities; and 

12 (iii) developments in aging services 

13 technology in other countries that may be 

14 applied in the United States; and 

15 (B) identification of— 

16 (i) barriers to innovation in aging 

17 services technology and devising strategies 

18 for removing such barriers; and 

19 (ii) barriers to the adoption of aging 

20 services technology by health care pro21 viders and consumers and devising strate22 gies to removing such barriers. 

23 (3) REPORT.—Not later than 24 months after 

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

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1 diction of the House of Representatives and of the 

2 Senate a report on the study carried out under para3 graph (1). 

4 (4) DEFINITIONS.—For purposes of this sub5 section: 

6 (A) AGING SERVICES TECHNOLOGY.—The 

7 term ‘‘aging services technology’’ means health 

8 technology that meets the health care needs of 

9 seniors, individuals with disabilities, and the 

10 caregivers of such seniors and individuals. 

11 (B) SENIOR.—The term ‘‘senior’’ has such 

12 meaning as specified by the Secretary. 

13 Subtitle B—Testing of Health 

14 Information Technology 

15 SEC. 4201. NATIONAL INSTITUTE FOR STANDARDS AND 

16 TECHNOLOGY TESTING. 

17 (a) PILOT TESTING OF STANDARDS AND IMPLEMEN18 TATION SPECIFICATIONS.—In coordination with the HIT 

19 Standards Committee established under section 3003 of 

20 the Public Health Service Act, as added by section 4101, 

21 with respect to the development of standards and imple22 mentation specifications under such section, the Director 

23 of the National Institute for Standards and Technology 

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1 plementation and use of such standards and implementa2 tion specifications. 

3 (b) VOLUNTARY TESTING PROGRAM.—In coordina4 tion with the HIT Standards Committee established under 

5 section 3003 of the Public Health Service Act, as added 

6 by section 4101, with respect to the development of stand7 ards and implementation specifications under such sec8 tion, the Director of the National Institute of Standards 

9 and Technology shall support the establishment of a con10 formance testing infrastructure, including the develop11 ment of technical test beds. The development of this con12 formance testing infrastructure may include a program to 

13 accredit independent, non-Federal laboratories to perform 

14 testing. 

15 SEC. 4202. RESEARCH AND DEVELOPMENT PROGRAMS. 

16 (a) HEALTH CARE INFORMATION ENTERPRISE INTE17 GRATION RESEARCH CENTERS.— 

18 (1) IN GENERAL.—The Director of the National 

19 Institute of Standards and Technology, in consulta20 tion with the Director of the National Science Foun21 dation and other appropriate Federal agencies, shall 

22 establish a program of assistance to institutions of 

23 higher education (or consortia thereof which may in24 clude nonprofit entities and Federal Government 


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1 laboratories) to establish multidisciplinary Centers 

2 for Health Care Information Enterprise Integration. 

3 (2) REVIEW; COMPETITION.—Grants shall be 

4 awarded under this subsection on a merit-reviewed, 

5 competitive basis. 

6 (3) PURPOSE.—The purposes of the Centers de7 scribed in paragraph (1) shall be— 

8 (A) to generate innovative approaches to 

9 health care information enterprise integration 

10 by conducting cutting-edge, multidisciplinary 

11 research on the systems challenges to health 

12 care delivery; and 

13 (B) the development and use of health in14 formation technologies and other complemen15 tary fields. 

16 (4) RESEARCH AREAS.—Research areas may in17 clude— 

18 (A) interfaces between human information 

19 and communications technology systems; 

20 (B) voice-recognition systems; 

21 (C) software that improves interoperability 

22 and connectivity among health information sys23 tems; 

24 (D) software dependability in systems crit25 ical to health care delivery; 


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1 (E) measurement of the impact of informa2 tion technologies on the quality and productivity 

3 of health care; 

4 (F) health information enterprise manage5 ment; 

6 (G) health information technology security 

7 and integrity; and 

8 (H) relevant health information technology 

9 to reduce medical errors. 

10 (5) APPLICATIONS.—An institution of higher 

11 education (or a consortium thereof) seeking funding 

12 under this subsection shall submit an application to 

13 the Director of the National Institute of Standards 

14 and Technology at such time, in such manner, and 

15 containing such information as the Director may re16 quire. The application shall include, at a minimum, 

17 a description of— 

18 (A) the research projects that will be un19 dertaken by the Center established pursuant to 

20 assistance under paragraph (1) and the respec21 tive contributions of the participating entities; 

22 (B) how the Center will promote active col23 laboration among scientists and engineers from 

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1 nology, biologic sciences, management, social 

2 sciences, and other appropriate disciplines; 

3 (C) technology transfer activities to dem4 onstrate and diffuse the research results, tech5 nologies, and knowledge; and 

6 (D) how the Center will contribute to the 

7 education and training of researchers and other 

8 professionals in fields relevant to health infor9 mation enterprise integration. 

10 (b) NATIONAL INFORMATION TECHNOLOGY RE11 SEARCH AND DEVELOPMENT PROGRAM.—The National 

12 High-Performance Computing Program established by 

13 section 101 of the High-Performance Computing Act of 

14 1991 (15 U.S.C. 5511) shall coordinate Federal research 

15 and development programs related to the development and 

16 deployment of health information technology, including ac17 tivities related to— 

18 (1) computer infrastructure; 

19 (2) data security; 

20 (3) development of large-scale, distributed, reli21 able computing systems; 

22 (4) wired, wireless, and hybrid high-speed net23 working; 

24 (5) development of software and software-inten25 sive systems; 


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1 (6) human-computer interaction and informa2 tion management technologies; and 

3 (7) the social and economic implications of in4 formation technology. 

5 Subtitle C—Incentives for the Use 

6 of Health Information Technology 

7 PART I—GRANTS AND LOANS FUNDING 

8 SEC. 4301. GRANT, LOAN, AND DEMONSTRATION PRO9 GRAMS. 

10 Title XXX of the Public Health Service Act, as added 

11 by section 4101, is amended by adding at the end the fol12 lowing new subtitle: 

13 ‘‘Subtitle B—Incentives for the Use 

14 of Health Information Technology 

15 ‘‘SEC. 3011. IMMEDIATE FUNDING TO STRENGTHEN THE 

16 HEALTH INFORMATION TECHNOLOGY INFRA17 STRUCTURE. 

18 ‘‘(a) IN GENERAL.—The Secretary shall, using 

19 amounts appropriated under section 3018, invest in the 

20 infrastructure necessary to allow for and promote the elec21 tronic exchange and use of health information for each 

22 individual in the United States consistent with the goals 

23 outlined in the strategic plan developed by the National 

24 Coordinator (and as available) under section 3001. To the 

25 greatest extent practicable, the Secretary shall ensure that 


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1 any funds so appropriated shall be used for the acquisition 

2 of health information technology that meets standards and 

3 certification criteria adopted before the date of the enact4 ment of this title until such date as the standards are 

5 adopted under section 3004. The Secretary shall invest 

6 funds through the different agencies with expertise in such 

7 goals, such as the Office of the National Coordinator for 

8 Health Information Technology, the Health Resources and 

9 Services Administration, the Agency for Healthcare Re10 search and Quality, the Centers of Medicare & Medicaid 

11 Services, the Centers for Disease Control and Prevention, 

12 and the Indian Health Service to support the following: 

13 ‘‘(1) Health information technology architecture 

14 that will support the nationwide electronic exchange 

15 and use of health information in a secure, private, 

16 and accurate manner, including connecting health 

17 information exchanges, and which may include up18 dating and implementing the infrastructure nec19 essary within different agencies of the Department 

20 of Health and Human Services to support the elec21 tronic use and exchange of health information. 

22 ‘‘(2) Development and adoption of appropriate 

23 certified electronic health records for categories of 

24 providers, as defined in section 3000, not eligible for 


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1 support under title XVIII or XIX of the Social Secu2 rity Act for the adoption of such records. 

3 ‘‘(3) Training on and dissemination of informa4 tion on best practices to integrate health information 

5 technology, including electronic health records, into 

6 a provider’s delivery of care, consistent with best 

7 practices learned from the Health Information Tech8 nology Research Center developed under section 

9 3012(b), including community health centers receiv10 ing assistance under section 330, covered entities 

11 under section 340B, and providers participating in 

12 one or more of the programs under titles XVIII, 

13 XIX, and XXI of the Social Security Act (relating 

14 to Medicare, Medicaid, and the State Children’s 

15 Health Insurance Program). 

16 ‘‘(4) Infrastructure and tools for the promotion 

17 of telemedicine, including coordination among Fed18 eral agencies in the promotion of telemedicine. 

19 ‘‘(5) Promotion of the interoperability of clinical 

20 data repositories or registries. 

21 ‘‘(6) Promotion of technologies and best prac22 tices that enhance the protection of health informa23 tion by all holders of individually identifiable health 

24 information. 


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1 ‘‘(7) Improvement and expansion of the use of 

2 health information technology by public health de3 partments. 

4 ‘‘(8) Provision of $300 million to support re5 gional or sub-national efforts towards health infor6 mation exchange. 

7 ‘‘(b) COORDINATION.—The Secretary shall ensure 

8 funds under this section are used in a coordinated manner 

9 with other health information promotion activities. 

10 ‘‘(c) ADDITIONAL USE OF FUNDS.—In addition to 

11 using funds as provided in subsection (a), the Secretary 

12 may use amounts appropriated under section 3018 to 

13 carry out activities that are provided for under laws in 

14 effect on the date of the enactment of this title. 

15 ‘‘SEC. 3012. HEALTH INFORMATION TECHNOLOGY IMPLE16 MENTATION ASSISTANCE. 

17 ‘‘(a) HEALTH INFORMATION TECHNOLOGY EXTEN18 SION PROGRAM.—To assist health care providers to adopt, 

19 implement, and effectively use certified EHR technology 

20 that allows for the electronic exchange and use of health 

21 information, the Secretary, acting through the Office of 

22 the National Coordinator, shall establish a health informa23 tion technology extension program to provide health infor24 mation technology assistance services to be carried out 

25 through the Department of Health and Human Services. 


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1 The National Coordinator shall consult with other Federal 

2 agencies with demonstrated experience and expertise in in3 formation technology services, such as the National Insti4 tute of Standards and Technology, in developing and im5 plementing this program. 

6 ‘‘(b) HEALTH INFORMATION TECHNOLOGY RE7 SEARCH CENTER.— 

8 ‘‘(1) IN GENERAL.—The Secretary shall create 

9 a Health Information Technology Research Center 

10 (in this section referred to as the ‘Center’) to pro11 vide technical assistance and develop or recognize 

12 best practices to support and accelerate efforts to 

13 adopt, implement, and effectively utilize health infor14 mation technology that allows for the electronic ex15 change and use of information in compliance with 

16 standards, implementation specifications, and certifi17 cation criteria adopted under section 3004. 

18 ‘‘(2) INPUT.—The Center shall incorporate 

19 input from— 

20 ‘‘(A) other Federal agencies with dem21 onstrated experience and expertise in informa22 tion technology services such as the National 

23 Institute of Standards and Technology; 

24 ‘‘(B) users of health information tech25 nology, such as providers and their support and 


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1 clerical staff and others involved in the care and 

2 care coordination of patients, from the health 

3 care and health information technology indus4 try; and 

5 ‘‘(C) others as appropriate. 

6 ‘‘(3) PURPOSES.—The purposes of the Center 

7 are to— 

8 ‘‘(A) provide a forum for the exchange of 

9 knowledge and experience; 

10 ‘‘(B) accelerate the transfer of lessons 

11 learned from existing public and private sector 

12 initiatives, including those currently receiving 

13 Federal financial support; 

14 ‘‘(C) assemble, analyze, and widely dis15 seminate evidence and experience related to the 

16 adoption, implementation, and effective use of 

17 health information technology that allows for 

18 the electronic exchange and use of information 

19 including through the regional centers described 

20 in subsection (c); 

21 ‘‘(D) provide technical assistance for the 

22 establishment and evaluation of regional and 

23 local health information networks to facilitate 

24 the electronic exchange of information across 


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1 health care settings and improve the quality of 

2 health care; 

3 ‘‘(E) provide technical assistance for the 

4 development and dissemination of solutions to 

5 barriers to the exchange of electronic health in6 formation; and 

7 ‘‘(F) learn about effective strategies to 

8 adopt and utilize health information technology 

9 in medically underserved communities. 

10 ‘‘(c) HEALTH INFORMATION TECHNOLOGY RE11 GIONAL EXTENSION CENTERS.— 

12 ‘‘(1) IN GENERAL.—The Secretary shall provide 

13 assistance for the creation and support of regional 

14 centers (in this subsection referred to as ‘regional 

15 centers’) to provide technical assistance and dissemi16 nate best practices and other information learned 

17 from the Center to support and accelerate efforts to 

18 adopt, implement, and effectively utilize health infor19 mation technology that allows for the electronic ex20 change and use of information in compliance with 

21 standards, implementation specifications, and certifi22 cation criteria adopted under section 3004. Activities 

23 conducted under this subsection shall be consistent 

24 with the strategic plan developed by the National 

25 Coordinator, (and, as available) under section 3001. 


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1 ‘‘(2) AFFILIATION.—Regional centers shall be 

2 affiliated with any United States-based nonprofit in3 stitution or organization, or group thereof, that ap4 plies and is awarded financial assistance under this 

5 section. Individual awards shall be decided on the 

6 basis of merit. 

7 ‘‘(3) OBJECTIVE.—The objective of the regional 

8 centers is to enhance and promote the adoption of 

9 health information technology through— 

10 ‘‘(A) assistance with the implementation, 

11 effective use, upgrading, and ongoing mainte12 nance of health information technology, includ13 ing electronic health records, to healthcare pro14 viders nationwide; 

15 ‘‘(B) broad participation of individuals 

16 from industry, universities, and State govern17 ments; 

18 ‘‘(C) active dissemination of best practices 

19 and research on the implementation, effective 

20 use, upgrading, and ongoing maintenance of 

21 health information technology, including elec22 tronic health records, to health care providers 

23 in order to improve the quality of healthcare 

24 and protect the privacy and security of health 

25 information; 


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1 ‘‘(D) participation, to the extent prac2 ticable, in health information exchanges; 

3 ‘‘(E) utilization, when appropriate, of the 

4 expertise and capability that exists in Federal 

5 agencies other than the Department; and 

6 ‘‘(F) integration of health information 

7 technology, including electronic health records, 

8 into the initial and ongoing training of health 

9 professionals and others in the healthcare in10 dustry that would be instrumental to improving 

11 the quality of healthcare through the smooth 

12 and accurate electronic use and exchange of 

13 health information. 

14 ‘‘(4) REGIONAL ASSISTANCE.—Each regional 

15 center shall aim to provide assistance and education 

16 to all providers in a region, but shall prioritize any 

17 direct assistance first to the following: 

18 ‘‘(A) Public or not-for-profit hospitals or 

19 critical access hospitals. 

20 ‘‘(B) Federally qualified health centers (as 

21 defined in section 1861(aa)(4) of the Social Se22 curity Act). 

23 ‘‘(C) Entities that are located in rural and 

24 other areas that serve uninsured, underinsured, 


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1 and medically underserved individuals (regard2 less of whether such area is urban or rural). 

3 ‘‘(D) Individual or small group practices 

4 (or a consortium thereof) that are primarily fo5 cused on primary care. 

6 ‘‘(5) FINANCIAL SUPPORT.—The Secretary may 

7 provide financial support to any regional center cre8 ated under this subsection for a period not to exceed 

9 four years. The Secretary may not provide more 

10 than 50 percent of the capital and annual operating 

11 and maintenance funds required to create and main12 tain such a center, except in an instance of national 

13 economic conditions which would render this cost14 share requirement detrimental to the program and 

15 upon notification to Congress as to the justification 

16 to waive the cost-share requirement. 

17 ‘‘(6) NOTICE OF PROGRAM DESCRIPTION AND

18 AVAILABILITY OF FUNDS.—The Secretary shall pub19 lish in the Federal Register, not later than 90 days 

20 after the date of the enactment of this title, a draft 

21 description of the program for establishing regional 

22 centers under this subsection. Such description shall 

23 include the following: 

24 ‘‘(A) A detailed explanation of the program 

25 and the programs goals. 


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1 ‘‘(B) Procedures to be followed by the ap2 plicants. 

3 ‘‘(C) Criteria for determining qualified ap4 plicants. 

5 ‘‘(D) Maximum support levels expected to 

6 be available to centers under the program. 

7 ‘‘(7) APPLICATION REVIEW.—The Secretary 

8 shall subject each application under this subsection 

9 to merit review. In making a decision whether to ap10 prove such application and provide financial support, 

11 the Secretary shall consider at a minimum the mer12 its of the application, including those portions of the 

13 application regarding— 

14 ‘‘(A) the ability of the applicant to provide 

15 assistance under this subsection and utilization 

16 of health information technology appropriate to 

17 the needs of particular categories of health care 

18 providers; 

19 ‘‘(B) the types of service to be provided to 

20 health care providers; 

21 ‘‘(C) geographical diversity and extent of 

22 service area; and 

23 ‘‘(D) the percentage of funding and 

24 amount of in-kind commitment from other 

25 sources. 


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1 ‘‘(8) BIENNIAL EVALUATION.—Each regional 

2 center which receives financial assistance under this 

3 subsection shall be evaluated biennially by an evalua4 tion panel appointed by the Secretary. Each evalua5 tion panel shall be composed of private experts, none 

6 of whom shall be connected with the center involved, 

7 and of Federal officials. Each evaluation panel shall 

8 measure the involved center’s performance against 

9 the objective specified in paragraph (3). The Sec10 retary shall not continue to provide funding to a re11 gional center unless its evaluation is overall positive. 

12 ‘‘(9) CONTINUING SUPPORT.—After the second 

13 year of assistance under this subsection, a regional 

14 center may receive additional support under this 

15 subsection if it has received positive evaluations and 

16 a finding by the Secretary that continuation of Fed17 eral funding to the center was in the best interest 

18 of provision of health information technology exten19 sion services. 

20 ‘‘SEC. 3013. STATE GRANTS TO PROMOTE HEALTH INFOR21 MATION TECHNOLOGY. 

22 ‘‘(a) IN GENERAL.—The Secretary, acting through 

23 the National Coordinator, shall establish a program in ac24 cordance with this section to facilitate and expand the 

25 electronic movement and use of health information among 


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1 organizations according to nationally recognized stand2 ards. 

3 ‘‘(b) PLANNING GRANTS.—The Secretary may award 

4 a grant to a State or qualified State-designated entity (as 

5 described in subsection (f)) that submits an application 

6 to the Secretary at such time, in such manner, and con7 taining such information as the Secretary may specify, for 

8 the purpose of planning activities described in subsection 

9 (d). 

10 ‘‘(c) IMPLEMENTATION GRANTS.—The Secretary 

11 may award a grant to a State or qualified State designated 

12 entity that— 

13 ‘‘(1) has submitted, and the Secretary has ap14 proved, a plan described in subsection (e) (regardless 

15 of whether such plan was prepared using amounts 

16 awarded under subsection (b)); and 

17 ‘‘(2) submits an application at such time, in 

18 such manner, and containing such information as 

19 the Secretary may specify. 

20 ‘‘(d) USE OF FUNDS.—Amounts received under a 

21 grant under subsection (c) shall be used to conduct activi22 ties to facilitate and expand the electronic movement and 

23 use of health information among organizations according 

24 to nationally recognized standards through activities that 

25 include— 


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1 ‘‘(1) enhancing broad and varied participation 

2 in the authorized and secure nationwide electronic 

3 use and exchange of health information; 

4 ‘‘(2) identifying State or local resources avail5 able towards a nationwide effort to promote health 

6 information technology; 

7 ‘‘(3) complementing other Federal grants, pro8 grams, and efforts towards the promotion of health 

9 information technology; 

10 ‘‘(4) providing technical assistance for the de11 velopment and dissemination of solutions to barriers 

12 to the exchange of electronic health information; 

13 ‘‘(5) promoting effective strategies to adopt and 

14 utilize health information technology in medically 

15 underserved communities; 

16 ‘‘(6) assisting patients in utilizing health infor17 mation technology; 

18 ‘‘(7) encouraging clinicians to work with Health 

19 Information Technology Regional Extension Centers 

20 as described in section 3012, to the extent they are 

21 available and valuable; 

22 ‘‘(8) supporting public health agencies’ author23 ized use of and access to electronic health informa24 tion; 


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1 ‘‘(9) promoting the use of electronic health 

2 records for quality improvement including through 

3 quality measures reporting; and 

4 ‘‘(10) such other activities as the Secretary may 

5 specify. 

6 ‘‘(e) PLAN.— 

7 ‘‘(1) IN GENERAL.—A plan described in this 

8 subsection is a plan that describes the activities to 

9 be carried out by a State or by the qualified State10 designated entity within such State to facilitate and 

11 expand the electronic movement and use of health 

12 information among organizations according to na13 tionally recognized standards and implementation 

14 specifications. 

15 ‘‘(2) REQUIRED ELEMENTS.—A plan described 

16 in paragraph (1) shall— 

17 ‘‘(A) be pursued in the public interest; 

18 ‘‘(B) be consistent with the strategic plan 

19 developed by the National Coordinator, (and, as 

20 available) under section 3001; 

21 ‘‘(C) include a description of the ways the 

22 State or qualified State-designated entity will 

23 carry out the activities described in subsection 

24 (b); and 


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1 ‘‘(D) contain such elements as the Sec2 retary may require. 

3 ‘‘(f) QUALIFIED STATE-DESIGNATED ENTITY.—For 

4 purposes of this section, to be a qualified State-designated 

5 entity, with respect to a State, an entity shall— 

6 ‘‘(1) be designated by the State as eligible to 

7 receive awards under this section; 

8 ‘‘(2) be a not-for-profit entity with broad stake9 holder representation on its governing board; 

10 ‘‘(3) demonstrate that one of its principal goals 

11 is to use information technology to improve health 

12 care quality and efficiency through the authorized 

13 and secure electronic exchange and use of health in14 formation; 

15 ‘‘(4) adopt nondiscrimination and conflict of in16 terest policies that demonstrate a commitment to 

17 open, fair, and nondiscriminatory participation by 

18 stakeholders; and 

19 ‘‘(5) conform to such other requirements as the 

20 Secretary may establish. 

21 ‘‘(g) REQUIRED CONSULTATION.—In carrying out 

22 activities described in subsections (b) and (c), a State or 

23 qualified State-designated entity shall consult with and 

24 consider the recommendations of— 


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1 ‘‘(1) health care providers (including providers 

2 that provide services to low income and underserved 

3 populations); 

4 ‘‘(2) health plans; 

5 ‘‘(3) patient or consumer organizations that 

6 represent the population to be served; 

7 ‘‘(4) health information technology vendors; 

8 ‘‘(5) health care purchasers and employers; 

9 ‘‘(6) public health agencies; 

10 ‘‘(7) health professions schools, universities and 

11 colleges; 

12 ‘‘(8) clinical researchers; 

13 ‘‘(9) other users of health information tech14 nology such as the support and clerical staff of pro15 viders and others involved in the care and care co16 ordination of patients; and 

17 ‘‘(10) such other entities, as may be determined 

18 appropriate by the Secretary. 

19 ‘‘(h) CONTINUOUS IMPROVEMENT.—The Secretary 

20 shall annually evaluate the activities conducted under this 

21 section and shall, in awarding grants under this section, 

22 implement the lessons learned from such evaluation in a 

23 manner so that awards made subsequent to each such 

24 evaluation are made in a manner that, in the determina25 tion of the Secretary, will lead towards the greatest imVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00112 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 provement in quality of care, decrease in costs, and the 

2 most effective authorized and secure electronic exchange 

3 of health information. 

4 ‘‘(i) REQUIRED MATCH.— 

5 ‘‘(1) IN GENERAL.—For a fiscal year (begin6 ning with fiscal year 2011), the Secretary may not 

7 make a grant under this section to a State unless 

8 the State agrees to make available non-Federal con9 tributions (which may include in-kind contributions) 

10 toward the costs of a grant awarded under sub11 section (c) in an amount equal to— 

12 ‘‘(A) for fiscal year 2011, not less than $1 

13 for each $10 of Federal funds provided under 

14 the grant; 

15 ‘‘(B) for fiscal year 2012, not less than $1 

16 for each $7 of Federal funds provided under 

17 the grant; and 

18 ‘‘(C) for fiscal year 2013 and each subse19 quent fiscal year, not less than $1 for each $3 

20 of Federal funds provided under the grant. 

21 ‘‘(2) AUTHORITY TO REQUIRE STATE MATCH

22 FOR FISCAL YEARS BEFORE FISCAL YEAR 2011.—For 

23 any fiscal year during the grant program under this 

24 section before fiscal year 2011, the Secretary may 

25 determine the extent to which there shall be required 


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1 a non-Federal contribution from a State receiving a 

2 grant under this section. 

3 ‘‘SEC. 3014. COMPETITIVE GRANTS TO STATES AND INDIAN 

4 TRIBES FOR THE DEVELOPMENT OF LOAN 

5 PROGRAMS TO FACILITATE THE WIDE6 SPREAD ADOPTION OF CERTIFIED EHR TECH7 NOLOGY. 

8 ‘‘(a) IN GENERAL.—The National Coordinator may 

9 award competitive grants to eligible entities for the estab10 lishment of programs for loans to health care providers 

11 to conduct the activities described in subsection (e). 

12 ‘‘(b) ELIGIBLE ENTITY DEFINED.—For purposes of 

13 this subsection, the term ‘eligible entity’ means a State 

14 or Indian tribe (as defined in the Indian Self-Determina15 tion and Education Assistance Act) that— 

16 ‘‘(1) submits to the National Coordinator an 

17 application at such time, in such manner, and con18 taining such information as the National Coordi19 nator may require; 

20 ‘‘(2) submits to the National Coordinator a 

21 strategic plan in accordance with subsection (d) and 

22 provides to the National Coordinator assurances that 

23 the entity will update such plan annually in accord24 ance with such subsection; 


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1 ‘‘(3) provides assurances to the National Coor2 dinator that the entity will establish a Loan Fund 

3 in accordance with subsection (c); 

4 ‘‘(4) provides assurances to the National Coor5 dinator that the entity will not provide a loan from 

6 the Loan Fund to a health care provider unless the 

7 provider agrees to— 

8 ‘‘(A) submit reports on quality measures 

9 adopted by the Federal Government (by not 

10 later than 90 days after the date on which such 

11 measures are adopted), to— 

12 ‘‘(i) the Administrator of the Centers 

13 for Medicare & Medicaid Services (or his 

14 or her designee), in the case of an entity 

15 participating in the Medicare program 

16 under title XVIII of the Social Security 

17 Act or the Medicaid program under title 

18 XIX of such Act; or 

19 ‘‘(ii) the Secretary in the case of other 

20 entities; 

21 ‘‘(B) demonstrate to the satisfaction of the 

22 Secretary (through criteria established by the 

23 Secretary) that any certified EHR technology 

24 purchased, improved, or otherwise financially 

25 supported under a loan under this section is 


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1 used to exchange health information in a man2 ner that, in accordance with law and standards 

3 (as adopted under section 3004) applicable to 

4 the exchange of information, improves the qual5 ity of health care, such as promoting care co6 ordination; 

7 ‘‘(C) comply with such other requirements 

8 as the entity or the Secretary may require; 

9 ‘‘(D) include a plan on how health care 

10 providers involved intend to maintain and sup11 port the certified EHR technology over time; 

12 and 

13 ‘‘(E) include a plan on how the health care 

14 providers involved intend to maintain and sup15 port the certified EHR technology that would 

16 be purchased with such loan, including the type 

17 of resources expected to be involved and any 

18 such other information as the State or Indian 

19 Tribe, respectively, may require; and 

20 ‘‘(5) agrees to provide matching funds in ac21 cordance with subsection (h). 

22 ‘‘(c) ESTABLISHMENT OF FUND.—For purposes of 

23 subsection (b)(3), an eligible entity shall establish a cer24 tified EHR technology loan fund (referred to in this sub25 section as a ‘Loan Fund’) and comply with the other reVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00116 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 quirements contained in this section. A grant to an eligible 

2 entity under this section shall be deposited in the Loan 

3 Fund established by the eligible entity. No funds author4 ized by other provisions of this title to be used for other 

5 purposes specified in this title shall be deposited in any 

6 Loan Fund. 

7 ‘‘(d) STRATEGIC PLAN.— 

8 ‘‘(1) IN GENERAL.—For purposes of subsection 

9 (b)(2), a strategic plan of an eligible entity under 

10 this subsection shall identify the intended uses of 

11 amounts available to the Loan Fund of such entity. 

12 ‘‘(2) CONTENTS.—A strategic plan under para13 graph (1), with respect to a Loan Fund of an eligi14 ble entity, shall include for a year the following: 

15 ‘‘(A) A list of the projects to be assisted 

16 through the Loan Fund during such year. 

17 ‘‘(B) A description of the criteria and 

18 methods established for the distribution of 

19 funds from the Loan Fund during the year. 

20 ‘‘(C) A description of the financial status 

21 of the Loan Fund as of the date of submission 

22 of the plan. 

23 ‘‘(D) The short-term and long-term goals 

24 of the Loan Fund. 


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1 ‘‘(e) USE OF FUNDS.—Amounts deposited in a Loan 

2 Fund, including loan repayments and interest earned on 

3 such amounts, shall be used only for awarding loans or 

4 loan guarantees, making reimbursements described in sub5 section (g)(4)(A), or as a source of reserve and security 

6 for leveraged loans, the proceeds of which are deposited 

7 in the Loan Fund established under subsection (c). Loans 

8 under this section may be used by a health care provider 

9 to— 

10 ‘‘(1) facilitate the purchase of certified EHR 

11 technology; 

12 ‘‘(2) enhance the utilization of certified EHR 

13 technology; 

14 ‘‘(3) train personnel in the use of such tech15 nology; or 

16 ‘‘(4) improve the secure electronic exchange of 

17 health information. 

18 ‘‘(f) TYPES OF ASSISTANCE.—Except as otherwise 

19 limited by applicable State law, amounts deposited into a 

20 Loan Fund under this section may only be used for the 

21 following: 

22 ‘‘(1) To award loans that comply with the fol23 lowing: 

24 ‘‘(A) The interest rate for each loan shall 

25 not exceed the market interest rate. 


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1 ‘‘(B) The principal and interest payments 

2 on each loan shall commence not later than 1 

3 year after the date the loan was awarded, and 

4 each loan shall be fully amortized not later than 

5 10 years after the date of the loan. 

6 ‘‘(C) The Loan Fund shall be credited with 

7 all payments of principal and interest on each 

8 loan awarded from the Loan Fund. 

9 ‘‘(2) To guarantee, or purchase insurance for, 

10 a local obligation (all of the proceeds of which fi11 nance a project eligible for assistance under this 

12 subsection) if the guarantee or purchase would im13 prove credit market access or reduce the interest 

14 rate applicable to the obligation involved. 

15 ‘‘(3) As a source of revenue or security for the 

16 payment of principal and interest on revenue or gen17 eral obligation bonds issued by the eligible entity if 

18 the proceeds of the sale of the bonds will be depos19 ited into the Loan Fund. 

20 ‘‘(4) To earn interest on the amounts deposited 

21 into the Loan Fund. 

22 ‘‘(5) To make reimbursements described in sub23 section (g)(4)(A). 

24 ‘‘(g) ADMINISTRATION OF LOAN FUNDS.— 


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1 ‘‘(1) COMBINED FINANCIAL ADMINISTRATION.— 

2 An eligible entity may (as a convenience and to 

3 avoid unnecessary administrative costs) combine, in 

4 accordance with applicable State law, the financial 

5 administration of a Loan Fund established under 

6 this subsection with the financial administration of 

7 any other revolving fund established by the entity if 

8 otherwise not prohibited by the law under which the 

9 Loan Fund was established. 

10 ‘‘(2) COST OF ADMINISTERING FUND.—Each el11 igible entity may annually use not to exceed 4 per12 cent of the funds provided to the entity under a 

13 grant under this section to pay the reasonable costs 

14 of the administration of the programs under this 

15 section, including the recovery of reasonable costs 

16 expended to establish a Loan Fund which are in17 curred after the date of the enactment of this title. 

18 ‘‘(3) GUIDANCE AND REGULATIONS.—The Na19 tional Coordinator shall publish guidance and pro20 mulgate regulations as may be necessary to carry 

21 out the provisions of this section, including— 

22 ‘‘(A) provisions to ensure that each eligible 

23 entity commits and expends funds allotted to 

24 the entity under this section as efficiently as 


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1 possible in accordance with this title and appli2 cable State laws; and 

3 ‘‘(B) guidance to prevent waste, fraud, and 

4 abuse. 

5 ‘‘(4) PRIVATE SECTOR CONTRIBUTIONS.— 

6 ‘‘(A) IN GENERAL.—A Loan Fund estab7 lished under this section may accept contribu8 tions from private sector entities, except that 

9 such entities may not specify the recipient or 

10 recipients of any loan issued under this sub11 section. An eligible entity may agree to reim12 burse a private sector entity for any contribu13 tion made under this subparagraph, except that 

14 the amount of such reimbursement may not be 

15 greater than the principal amount of the con16 tribution made. 

17 ‘‘(B) AVAILABILITY OF INFORMATION.— 

18 An eligible entity shall make publicly available 

19 the identity of, and amount contributed by, any 

20 private sector entity under subparagraph (A) 

21 and may issue letters of commendation or make 

22 other awards (that have no financial value) to 

23 any such entity. 

24 ‘‘(h) MATCHING REQUIREMENTS.— 


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1 ‘‘(1) IN GENERAL.—The National Coordinator 

2 may not make a grant under subsection (a) to an el3 igible entity unless the entity agrees to make avail4 able (directly or through donations from public or 

5 private entities) non-Federal contributions in cash to 

6 the costs of carrying out the activities for which the 

7 grant is awarded in an amount equal to not less 

8 than $1 for each $5 of Federal funds provided under 

9 the grant. 

10 ‘‘(2) DETERMINATION OF AMOUNT OF NON11 FEDERAL CONTRIBUTION.—In determining the 

12 amount of non-Federal contributions that an eligible 

13 entity has provided pursuant to subparagraph (A), 

14 the National Coordinator may not include any 

15 amounts provided to the entity by the Federal Gov16 ernment. 

17 ‘‘(i) EFFECTIVE DATE.—The Secretary may not 

18 make an award under this section prior to January 1, 

19 2010. 

20 ‘‘SEC. 3015. DEMONSTRATION PROGRAM TO INTEGRATE IN21 FORMATION TECHNOLOGY INTO CLINICAL 

22 EDUCATION. 

23 ‘‘(a) IN GENERAL.—The Secretary may award grants 

24 under this section to carry out demonstration projects to 

25 develop academic curricula integrating certified EHR 


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1 technology in the clinical education of health professionals. 

2 Such awards shall be made on a competitive basis and 

3 pursuant to peer review. 

4 ‘‘(b) ELIGIBILITY.—To be eligible to receive a grant 

5 under subsection (a), an entity shall— 

6 ‘‘(1) submit to the Secretary an application at 

7 such time, in such manner, and containing such in8 formation as the Secretary may require; 

9 ‘‘(2) submit to the Secretary a strategic plan 

10 for integrating certified EHR technology in the clin11 ical education of health professionals to reduce med12 ical errors and enhance health care quality; 

13 ‘‘(3) be— 

14 ‘‘(A) a school of medicine, osteopathic 

15 medicine, dentistry, or pharmacy, a graduate 

16 program in behavioral or mental health, or any 

17 other graduate health professions school; 

18 ‘‘(B) a graduate school of nursing or phy19 sician assistant studies; 

20 ‘‘(C) a consortium of two or more schools 

21 described in subparagraph (A) or (B); or 

22 ‘‘(D) an institution with a graduate med23 ical education program in medicine, osteopathic 

24 medicine, dentistry, pharmacy, nursing, or phy25 sician assistance studies; 


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1 ‘‘(4) provide for the collection of data regarding 

2 the effectiveness of the demonstration project to be 

3 funded under the grant in improving the safety of 

4 patients, the efficiency of health care delivery, and 

5 in increasing the likelihood that graduates of the 

6 grantee will adopt and incorporate certified EHR 

7 technology, in the delivery of health care services; 

8 and 

9 ‘‘(5) provide matching funds in accordance with 

10 subsection (d). 

11 ‘‘(c) USE OF FUNDS.— 

12 ‘‘(1) IN GENERAL.—With respect to a grant 

13 under subsection (a), an eligible entity shall— 

14 ‘‘(A) use grant funds in collaboration with 

15 2 or more disciplines; and 

16 ‘‘(B) use grant funds to integrate certified 

17 EHR technology into community-based clinical 

18 education. 

19 ‘‘(2) LIMITATION.—An eligible entity shall not 

20 use amounts received under a grant under sub21 section (a) to purchase hardware, software, or serv22 ices. 

23 ‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 

24 provide more than 50 percent of the costs of any activity 

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1 cept in an instance of national economic conditions which 

2 would render the cost-share requirement under this sub3 section detrimental to the program and upon notification 

4 to Congress as to the justification to waive the cost-share 

5 requirement. 

6 ‘‘(e) EVALUATION.—The Secretary shall take such 

7 action as may be necessary to evaluate the projects funded 

8 under this section and publish, make available, and dis9 seminate the results of such evaluations on as wide a basis 

10 as is practicable. 

11 ‘‘(f) REPORTS.—Not later than 1 year after the date 

12 of enactment of this title, and annually thereafter, the Sec13 retary shall submit to the Committee on Health, Edu14 cation, Labor, and Pensions and the Committee on Fi15 nance of the Senate, and the Committee on Energy and 

16 Commerce of the House of Representatives a report 

17 that— 

18 ‘‘(1) describes the specific projects established 

19 under this section; and 

20 ‘‘(2) contains recommendations for Congress 

21 based on the evaluation conducted under subsection 

22 (e). 


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1 ‘‘SEC. 3016. INFORMATION TECHNOLOGY PROFESSIONALS 

2 ON HEALTH CARE. 

3 ‘‘(a) IN GENERAL.—The Secretary, in consultation 

4 with the Director of the National Science Foundation, 

5 shall provide assistance to institutions of higher education 

6 (or consortia thereof) to establish or expand medical 

7 health informatics education programs, including certifi8 cation, undergraduate, and masters degree programs, for 

9 both health care and information technology students to 

10 ensure the rapid and effective utilization and development 

11 of health information technologies (in the United States 

12 health care infrastructure). 

13 ‘‘(b) ACTIVITIES.—Activities for which assistance 

14 may be provided under subsection (a) may include the fol15 lowing: 

16 ‘‘(1) Developing and revising curricula in med17 ical health informatics and related disciplines. 

18 ‘‘(2) Recruiting and retaining students to the 

19 program involved. 

20 ‘‘(3) Acquiring equipment necessary for student 

21 instruction in these programs, including the installa22 tion of testbed networks for student use. 

23 ‘‘(4) Establishing or enhancing bridge programs 

24 in the health informatics fields between community 

25 colleges and universities. 


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1 ‘‘(c) PRIORITY.—In providing assistance under sub2 section (a), the Secretary shall give preference to the fol3 lowing: 

4 ‘‘(1) Existing education and training programs. 

5 ‘‘(2) Programs designed to be completed in less 

6 than six months. 

7 ‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 

8 provide more than 50 percent of the costs of any activity 

9 for which assistance is provided under subsection (a), ex10 cept in an instance of national economic conditions which 

11 would render the cost-share requirement under this sub12 section detrimental to the program and upon notification 

13 to Congress as to the justification to waive the cost-share 

14 requirement. 

15 ‘‘SEC. 3017. GENERAL GRANT AND LOAN PROVISIONS. 

16 ‘‘(a) REPORTS.—The Secretary may require that an 

17 entity receiving assistance under this subtitle shall submit 

18 to the Secretary, not later than the date that is 1 year 

19 after the date of receipt of such assistance, a report that 

20 includes— 

21 ‘‘(1) an analysis of the effectiveness of the ac22 tivities for which the entity receives such assistance, 

23 as compared to the goals for such activities; and 

24 ‘‘(2) an analysis of the impact of the project on 

25 health care quality and safety. 


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1 ‘‘(b) REQUIREMENT TO IMPROVE QUALITY OF CARE

2 AND DECREASE IN COSTS.—The National Coordinator 

3 shall annually evaluate the activities conducted under this 

4 subtitle and shall, in awarding grants, implement the les5 sons learned from such evaluation in a manner so that 

6 awards made subsequent to each such evaluation are made 

7 in a manner that, in the determination of the National 

8 Coordinator, will result in the greatest improvement in the 

9 quality and efficiency of health care. 

10 ‘‘SEC. 3018. AUTHORIZATION FOR APPROPRIATIONS. 

11 ‘‘For the purposes of carrying out this subtitle, there 

12 is authorized to be appropriated such sums as may be nec13 essary for each of the fiscal years 2009 through 2013. 

14 Amounts so appropriated shall remain available until ex15 pended.’’. 

16 PART II—MEDICARE PROGRAM 

17 SEC. 4311. INCENTIVES FOR ELIGIBLE PROFESSIONALS. 

18 (a) INCENTIVE PAYMENTS.—Section 1848 of the So19 cial Security Act (42 U.S.C. 1395w–4) is amended by add20 ing at the end the following new subsection: 

21 ‘‘(o) INCENTIVES FOR ADOPTION AND MEANINGFUL

22 USE OF CERTIFIED EHR TECHNOLOGY.— 

23 ‘‘(1) INCENTIVE PAYMENTS.— 

24 ‘‘(A) IN GENERAL.—Subject to the suc25 ceeding subparagraphs of this paragraph, with 


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1 respect to covered professional services fur2 nished by an eligible professional during a pay3 ment year (as defined in subparagraph (E)), if 

4 the eligible professional is a meaningful EHR 

5 user (as determined under paragraph (2)) for 

6 the reporting period with respect to such year, 

7 in addition to the amount otherwise paid under 

8 this part, there also shall be paid to the eligible 

9 professional (or to an employer or facility in the 

10 cases described in clause (A) of section 

11 1842(b)(6)), from the Federal Supplementary 

12 Medical Insurance Trust Fund established 

13 under section 1841 an amount equal to 75 per14 cent of the Secretary’s estimate (based on 

15 claims submitted not later than 2 months after 

16 the end of the payment year) of the allowed 

17 charges under this part for all such covered 

18 professional services furnished by the eligible 

19 professional during such year. 

20 ‘‘(B) LIMITATIONS ON AMOUNTS OF IN21 CENTIVE PAYMENTS.— 

22 ‘‘(i) IN GENERAL.—In no case shall 

23 the amount of the incentive payment pro24 vided under this paragraph for an eligible 

25 professional for a payment year exceed the 


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1 applicable amount specified under this sub2 paragraph with respect to such eligible 

3 professional and such year. 

4 ‘‘(ii) AMOUNT.—Subject to clause 

5 (iii), the applicable amount specified in this 

6 subparagraph for an eligible professional is 

7 as follows: 

8 ‘‘(I) For the first payment year 

9 for such professional, $15,000. 

10 ‘‘(II) For the second payment 

11 year for such professional, $12,000. 

12 ‘‘(III) For the third payment 

13 year for such professional, $8,000. 

14 ‘‘(IV) For the fourth payment 

15 year for such professional, $4,000. 

16 ‘‘(V) For the fifth payment year 

17 for such professional, $2,000. 

18 ‘‘(VI) For any succeeding pay19 ment year for such professional, $0. 

20 ‘‘(iii) PHASE DOWN FOR ELIGIBLE

21 PROFESSIONALS FIRST ADOPTING EHR

22 AFTER 2013.—If the first payment year for 

23 an eligible professional is after 2013, then 

24 the amount specified in this subparagraph 

25 for a payment year for such professional is 


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1 the same as the amount specified in clause 

2 (ii) for such payment year for an eligible 

3 professional whose first payment year is 

4 2013. If the first payment year for an eli5 gible professional is after 2015 then the 

6 applicable amount specified in this sub7 paragraph for such professional for such 

8 year and any subsequent year shall be $0. 

9 ‘‘(C) NON-APPLICATION TO HOSPITAL10 BASED ELIGIBLE PROFESSIONALS.— 

11 ‘‘(i) IN GENERAL.—No incentive pay12 ment may be made under this paragraph 

13 in the case of a hospital-based eligible pro14 fessional. 

15 ‘‘(ii) HOSPITAL-BASED ELIGIBLE PRO16 FESSIONAL.—For purposes of clause (i), 

17 the term ‘hospital-based eligible profes18 sional’ means, with respect to covered pro19 fessional services furnished by an eligible 

20 professional during the reporting period for 

21 a payment year, an eligible professional, 

22 such as a pathologist, anesthesiologist, or 

23 emergency physician, who furnishes sub24 stantially all of such services in a hospital 

25 setting (whether inpatient or outpatient) 


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1 and through the use of the facilities and 

2 equipment, including computer equipment, 

3 of the hospital. 

4 ‘‘(D) PAYMENT.— 

5 ‘‘(i) FORM OF PAYMENT.—The pay6 ment under this paragraph may be in the 

7 form of a single consolidated payment or 

8 in the form of such periodic installments 

9 as the Secretary may specify. 

10 ‘‘(ii) COORDINATION OF APPLICATION

11 OF LIMITATION FOR PROFESSIONALS IN

12 DIFFERENT PRACTICES.—In the case of an 

13 eligible professional furnishing covered pro14 fessional services in more than one practice 

15 (as specified by the Secretary), the Sec16 retary shall establish rules to coordinate 

17 the incentive payments, including the ap18 plication of the limitation on amounts of 

19 such incentive payments under this para20 graph, among such practices. 

21 ‘‘(iii) COORDINATION WITH MED22 ICAID.—The Secretary shall seek, to the 

23 maximum extent practicable, to avoid du24 plicative requirements from Federal and 

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1 ingful use of certified EHR technology 

2 under this title and title XIX. In doing so, 

3 the Secretary may deem satisfaction of 

4 State requirements for such meaningful 

5 use for a payment year under title XIX to 

6 be sufficient to qualify as meaningful use 

7 under this subsection and subsection (a)(7) 

8 and vice versa. The Secretary may also ad9 just the reporting periods under such title 

10 and such subsections in order to carry out 

11 this clause. 

12 ‘‘(E) PAYMENT YEAR DEFINED.— 

13 ‘‘(i) IN GENERAL.—For purposes of 

14 this subsection, the term ‘payment year’ 

15 means a year beginning with 2011. 

16 ‘‘(ii) FIRST, SECOND, ETC. PAYMENT

17 YEAR.—The term ‘first payment year’ 

18 means, with respect to covered professional 

19 services furnished by an eligible profes20 sional, the first year for which an incentive 

21 payment is made for such services under 

22 this subsection. The terms ‘second pay23 ment year’, ‘third payment year’, ‘fourth 

24 payment year’, and ‘fifth payment year’ 

25 mean, with respect to covered professional 


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1 services furnished by such eligible profes2 sional, each successive year immediately 

3 following the first payment year for such 

4 professional. 

5 ‘‘(2) MEANINGFUL EHR USER.— 

6 ‘‘(A) IN GENERAL.—For purposes of para7 graph (1), an eligible professional shall be 

8 treated as a meaningful EHR user for a report9 ing period for a payment year (or, for purposes 

10 of subsection (a)(7), for a reporting period 

11 under such subsection for a year) if each of the 

12 following requirements is met: 

13 ‘‘(i) MEANINGFUL USE OF CERTIFIED

14 EHR TECHNOLOGY.—The eligible profes15 sional demonstrates to the satisfaction of 

16 the Secretary, in accordance with subpara17 graph (C)(i), that during such period the 

18 professional is using certified EHR tech19 nology in a meaningful manner, which 

20 shall include the use of electronic pre21 scribing as determined to be appropriate 

22 by the Secretary. 

23 ‘‘(ii) INFORMATION EXCHANGE.—The 

24 eligible professional demonstrates to the 

25 satisfaction of the Secretary, in accordance 


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1 with subparagraph (C)(i), that during such 

2 period such certified EHR technology is 

3 connected in a manner that provides, in 

4 accordance with law and standards appli5 cable to the exchange of information, for 

6 the electronic exchange of health informa7 tion to improve the quality of health care, 

8 such as promoting care coordination. 

9 ‘‘(iii) REPORTING ON MEASURES

10 USING EHR.—Subject to subparagraph 

11 (B)(ii) and using such certified EHR tech12 nology, the eligible professional submits in13 formation for such period, in a form and 

14 manner specified by the Secretary, on such 

15 clinical quality measures and such other 

16 measures as selected by the Secretary 

17 under subparagraph (B)(i). 

18 The Secretary may provide for the use of alter19 native means for meeting the requirements of 

20 clauses (i), (ii), and (iii) in the case of an eligi21 ble professional furnishing covered professional 

22 services in a group practice (as defined by the 

23 Secretary). The Secretary shall seek to improve 

24 the use of electronic health records and health 

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1 gent measures of meaningful use selected under 

2 this paragraph. 

3 ‘‘(B) REPORTING ON MEASURES.— 

4 ‘‘(i) SELECTION.—The Secretary shall 

5 select measures for purposes of subpara6 graph (A)(iii) but only consistent with the 

7 following: 

8 ‘‘(I) The Secretary shall provide 

9 preference to clinical quality measures 

10 that have been endorsed by the entity 

11 with a contract with the Secretary 

12 under section 1890(a). 

13 ‘‘(II) Prior to any measure being 

14 selected under this subparagraph, the 

15 Secretary shall publish in the Federal 

16 Register such measure and provide for 

17 a period of public comment on such 

18 measure. 

19 ‘‘(ii) LIMITATION.—The Secretary 

20 may not require the electronic reporting of 

21 information on clinical quality measures 

22 under subparagraph (A)(iii) unless the 

23 Secretary has the capacity to accept the in24 formation electronically, which may be on 

25 a pilot basis. 


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1 ‘‘(iii) COORDINATION OF REPORTING

2 OF INFORMATION.—In selecting such 

3 measures, and in establishing the form and 

4 manner for reporting measures under sub5 paragraph (A)(iii), the Secretary shall seek 

6 to avoid redundant or duplicative reporting 

7 otherwise required, including reporting 

8 under subsection (k)(2)(C). 

9 ‘‘(C) DEMONSTRATION OF MEANINGFUL

10 USE OF CERTIFIED EHR TECHNOLOGY AND IN11 FORMATION EXCHANGE.— 

12 ‘‘(i) IN GENERAL.—A professional 

13 may satisfy the demonstration requirement 

14 of clauses (i) and (ii) of subparagraph (A) 

15 through means specified by the Secretary, 

16 which may include— 

17 ‘‘(I) an attestation; 

18 ‘‘(II) the submission of claims 

19 with appropriate coding (such as a 

20 code indicating that a patient encoun21 ter was documented using certified 

22 EHR technology); 

23 ‘‘(III) a survey response; 

24 ‘‘(IV) reporting under subpara25 graph (A)(iii); and 


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1 ‘‘(V) other means specified by the 

2 Secretary. 

3 ‘‘(ii) USE OF PART D DATA.—Not4 withstanding sections 1860D–15(d)(2)(B) 

5 and 1860D–15(f)(2), the Secretary may 

6 use data regarding drug claims submitted 

7 for purposes of section 1860D–15 that are 

8 necessary for purposes of subparagraph 

9 (A). 

10 ‘‘(3) APPLICATION.— 

11 ‘‘(A) PHYSICIAN REPORTING SYSTEM

12 RULES.—Paragraphs (5), (6), and (8) of sub13 section (k) shall apply for purposes of this sub14 section in the same manner as they apply for 

15 purposes of such subsection. 

16 ‘‘(B) COORDINATION WITH OTHER PAY17 MENTS.—The provisions of this subsection shall 

18 not be taken into account in applying the provi19 sions of subsection (m) of this section and of 

20 section 1833(m) and any payment under such 

21 provisions shall not be taken into account in 

22 computing allowable charges under this sub23 section. 

24 ‘‘(C) 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 determination of any incentive payment 

3 under this subsection and the payment adjust4 ment under subsection (a)(7), including the de5 termination of a meaningful EHR user under 

6 paragraph (2), a limitation under paragraph 

7 (1)(B), and the exception under subsection 

8 (a)(7)(B). 

9 ‘‘(D) POSTING ON WEBSITE.—The Sec10 retary shall post on the Internet website of the 

11 Centers for Medicare & Medicaid Services, in an 

12 easily understandable format, a list of the 

13 names, business addresses, and business phone 

14 numbers of the eligible professionals who are 

15 meaningful EHR users and, as determined ap16 propriate by the Secretary, of group practices 

17 receiving incentive payments under paragraph 

18 (1). 

19 ‘‘(4) CERTIFIED EHR TECHNOLOGY DEFINED.— 

20 For purposes of this section, the term ‘certified 

21 EHR technology’ means a qualified electronic health 

22 record (as defined in 3000(13) of the Public Health 

23 Service Act) that is certified pursuant to section 

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1 ble to the type of record involved (as determined by 

2 the Secretary, such as an ambulatory electronic 

3 health record for office-based physicians or an inpa4 tient hospital electronic health record for hospitals). 

5 ‘‘(5) DEFINITIONS.—For purposes of this sub6 section: 

7 ‘‘(A) COVERED PROFESSIONAL SERV8 ICES.—The term ‘covered professional services’ 

9 has the meaning given such term in subsection 

10 (k)(3). 

11 ‘‘(B) ELIGIBLE PROFESSIONAL.—The term 

12 ‘eligible professional’ means a physician, as de13 fined in section 1861(r). 

14 ‘‘(C) REPORTING PERIOD.—The term ‘re15 porting period’ means any period (or periods), 

16 with respect to a payment year, as specified by 

17 the Secretary.’’. 

18 (b) INCENTIVE PAYMENT ADJUSTMENT.—Section 

19 1848(a) of the Social Security Act (42 U.S.C. 1395w– 

20 4(a)) is amended by adding at the end the following new 

21 paragraph: 

22 ‘‘(7) INCENTIVES FOR MEANINGFUL USE OF

23 CERTIFIED EHR TECHNOLOGY.— 

24 ‘‘(A) ADJUSTMENT.— 


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1 ‘‘(i) IN GENERAL.—Subject to sub2 paragraphs (B) and (D), with respect to 

3 covered professional services furnished by 

4 an eligible professional during 2016 or any 

5 subsequent payment year, if the eligible 

6 professional is not a meaningful EHR user 

7 (as determined under subsection (o)(2)) for 

8 a reporting period for the year, the fee 

9 schedule amount for such services fur10 nished by such professional during the year 

11 (including the fee schedule amount for pur12 poses of determining a payment based on 

13 such amount) shall be equal to the applica14 ble percent of the fee schedule amount that 

15 would otherwise apply to such services 

16 under this subsection (determined after ap17 plication of paragraph (3) but without re18 gard to this paragraph). 

19 ‘‘(ii) APPLICABLE PERCENT.—Subject 

20 to clause (iii), for purposes of clause (i), 

21 the term ‘applicable percent’ means— 

22 ‘‘(I) for 2016, 99 percent; 

23 ‘‘(II) for 2017, 98 percent; and 

24 ‘‘(III) for 2018 and each subse25 quent year, 97 percent. 


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1 ‘‘(iii) AUTHORITY TO DECREASE AP2 PLICABLE PERCENTAGE FOR 2019 AND

3 SUBSEQUENT YEARS.—For 2019 and each 

4 subsequent year, if the Secretary finds that 

5 the proportion of eligible professionals who 

6 are meaningful EHR users (as determined 

7 under subsection (o)(2)) is less than 75 

8 percent, the applicable percent shall be de9 creased by 1 percentage point from the ap10 plicable percent in the preceding year, but 

11 in no case shall the applicable percent be 

12 less than 95 percent. 

13 ‘‘(B) SIGNIFICANT HARDSHIP EXCEP14 TION.—The Secretary may, on a case-by-case 

15 basis, exempt an eligible professional from the 

16 application of the payment adjustment under 

17 subparagraph (A) if the Secretary determines, 

18 subject to annual renewal, that compliance with 

19 the requirement for being a meaningful EHR 

20 user would result in a significant hardship, such 

21 as in the case of an eligible professional who 

22 practices in a rural area without sufficient 

23 Internet access. In no case may an eligible pro24 fessional be granted an exemption under this 

25 subparagraph for more than 5 years. 


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1 ‘‘(C) APPLICATION OF PHYSICIAN REPORT2 ING SYSTEM RULES.—Paragraphs (5), (6), and 

3 (8) of subsection (k) shall apply for purposes of 

4 this paragraph in the same manner as they 

5 apply for purposes of such subsection. 

6 ‘‘(D) NON-APPLICATION TO HOSPITAL7 BASED ELIGIBLE PROFESSIONALS.—No pay8 ment adjustment may be made under subpara9 graph (A) in the case of hospital-based eligible 

10 professionals (as defined in subsection 

11 (o)(1)(C)(ii)). 

12 ‘‘(E) DEFINITIONS.—For purposes of this 

13 paragraph: 

14 ‘‘(i) COVERED PROFESSIONAL SERV15 ICES.—The term ‘covered professional 

16 services’ has the meaning given such term 

17 in subsection (k)(3). 

18 ‘‘(ii) ELIGIBLE PROFESSIONAL.—The 

19 term ‘eligible professional’ means a physi20 cian, as defined in section 1861(r). 

21 ‘‘(iii) REPORTING PERIOD.—The term 

22 ‘reporting period’ means, with respect to a 

23 year, a period specified by the Secretary.’’. 

24 (c) APPLICATION TO CERTAIN HMO-AFFILIATED

25 ELIGIBLE PROFESSIONALS.—Section 1853 of the Social 


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1 Security Act (42 U.S.C. 1395w–23) is amended by adding 

2 at the end the following new subsection: 

3 ‘‘(l) APPLICATION OF ELIGIBLE PROFESSIONAL IN4 CENTIVES FOR CERTAIN MA ORGANIZATIONS FOR ADOP5 TION AND MEANINGFUL USE OF CERTIFIED EHR TECH6 NOLOGY.— 

7 ‘‘(1) IN GENERAL.—Subject to paragraphs (3) 

8 and (4), in the case of a qualifying MA organization, 

9 the provisions of sections 1848(o) and 1848(a)(7) 

10 shall apply with respect to eligible professionals de11 scribed in paragraph (2) of the organization who the 

12 organization attests under paragraph (6) to be 

13 meaningful EHR users in a similar manner as they 

14 apply to eligible professionals under such sections. 

15 Incentive payments under paragraph (3) shall be 

16 made to and payment adjustments under paragraph 

17 (4) shall apply to such qualifying organizations. 

18 ‘‘(2) ELIGIBLE PROFESSIONAL DESCRIBED.— 

19 With respect to a qualifying MA organization, an eli20 gible professional described in this paragraph is an 

21 eligible professional (as defined for purposes of sec22 tion 1848(o)) who— 

23 ‘‘(A)(i) is employed by the organization; or 

24 ‘‘(ii)(I) is employed by, or is a partner of, 

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1 zation furnishes at least 80 percent of the enti2 ty’s patient care services to enrollees of such or3 ganization; and 

4 ‘‘(II) furnishes at least 75 percent of the 

5 professional services of the eligible professional 

6 to enrollees of the organization; and 

7 ‘‘(B) furnishes, on average, at least 20 

8 hours per week of patient care services. 

9 ‘‘(3) ELIGIBLE PROFESSIONAL INCENTIVE PAY10 MENTS.— 

11 ‘‘(A) IN GENERAL.—In applying section 

12 1848(o) under paragraph (1), instead of the ad13 ditional payment amount under section 

14 1848(o)(1)(A) and subject to subparagraph 

15 (B), the Secretary may substitute an amount 

16 determined by the Secretary to the extent fea17 sible and practical to be similar to the esti18 mated amount in the aggregate that would be 

19 payable if payment for services furnished by 

20 such professionals was payable under part B in21 stead of this part. 

22 ‘‘(B) AVOIDING DUPLICATION OF PAY23 MENTS.— 

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1 gible for the maximum incentive payment 

2 under section 1848(o)(1)(A) for the same 

3 payment period, the payment incentive 

4 shall be made only under such section and 

5 not under this subsection. 

6 ‘‘(ii) METHODS.—In the case of an el7 igible professional described in paragraph 

8 (2) who is eligible for an incentive payment 

9 under section 1848(o)(1)(A) but is not de10 scribed in clause (i) for the same payment 

11 period, the Secretary shall develop a proc12 ess— 

13 ‘‘(I) to ensure that duplicate pay14 ments are not made with respect to 

15 an eligible professional both under 

16 this subsection and under section 

17 1848(o)(1)(A); and 

18 ‘‘(II) to collect data from Medi19 care Advantage organizations to en20 sure against such duplicate payments. 

21 ‘‘(C) FIXED SCHEDULE FOR APPLICATION

22 OF LIMITATION ON INCENTIVE PAYMENTS FOR

23 ALL ELIGIBLE PROFESSIONALS.—In applying 

24 section 1848(o)(1)(B)(ii) under subparagraph 

25 (A), in accordance with rules specified by the 


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1 Secretary, a qualifying MA organization shall 

2 specify a year (not earlier than 2011) that shall 

3 be treated as the first payment year for all eli4 gible professionals with respect to such organi5 zation. 

6 ‘‘(4) PAYMENT ADJUSTMENT.— 

7 ‘‘(A) IN GENERAL.—In applying section 

8 1848(a)(7) under paragraph (1), instead of the 

9 payment adjustment being an applicable per10 cent of the fee schedule amount for a year 

11 under such section, subject to subparagraph 

12 (D), the payment adjustment under paragraph 

13 (1) shall be equal to the percent specified in 

14 subparagraph (B) for such year of the payment 

15 amount otherwise provided under this section 

16 for such year. 

17 ‘‘(B) SPECIFIED PERCENT.—The percent 

18 specified under this subparagraph for a year is 

19 100 percent minus a number of percentage 

20 points equal to the product of— 

21 ‘‘(i) the number of percentage points 

22 by which the applicable percent (under sec23 tion 1848(a)(7)(A)(ii)) for the year is less 

24 than 100 percent; and 


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1 ‘‘(ii) the Medicare physician expendi2 ture proportion specified in subparagraph 

3 (C) for the year. 

4 ‘‘(C) MEDICARE PHYSICIAN EXPENDITURE

5 PROPORTION.—The Medicare physician expend6 iture proportion under this subparagraph for a 

7 year is the Secretary’s estimate of the propor8 tion, of the expenditures under parts A and B 

9 that are not attributable to this part, that are 

10 attributable to expenditures for physicians’ 

11 services. 

12 ‘‘(D) APPLICATION OF PAYMENT ADJUST13 MENT.—In the case that a qualifying MA orga14 nization attests that not all eligible profes15 sionals are meaningful EHR users with respect 

16 to a year, the Secretary shall apply the payment 

17 adjustment under this paragraph based on the 

18 proportion of such eligible professionals that are 

19 not meaningful EHR users for such year. 

20 ‘‘(5) QUALIFYING MA ORGANIZATION DE21 FINED.—In this subsection and subsection (m), the 

22 term ‘qualifying MA organization’ means a Medicare 

23 Advantage organization that is organized as a health 

24 maintenance organization (as defined in section 

25 2791(b)(3) of the Public Health Service Act). 


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1 ‘‘(6) MEANINGFUL EHR USER ATTESTATION.— 

2 For purposes of this subsection and subsection (m), 

3 a qualifying MA organization shall submit an attes4 tation, in a form and manner specified by the Sec5 retary which may include the submission of such at6 testation as part of submission of the initial bid 

7 under section 1854(a)(1)(A)(iv), identifying— 

8 ‘‘(A) whether each eligible professional de9 scribed in paragraph (2), with respect to such 

10 organization is a meaningful EHR user (as de11 fined in section 1848(o)(2)) for a year specified 

12 by the Secretary; and 

13 ‘‘(B) whether each eligible hospital de14 scribed in subsection (m)(1), with respect to 

15 such organization, is a meaningful EHR user 

16 (as defined in section 1886(n)(3)) for an appli17 cable period specified by the Secretary.’’. 

18 (d) CONFORMING AMENDMENTS.—Section 1853 of 

19 the Social Security Act (42 U.S.C. 1395w–23) is amend20 ed— 

21 (1) in subsection (a)(1)(A), by striking ‘‘and 

22 (i)’’ and inserting ‘‘(i), and (l)’’; 

23 (2) in subsection (c)— 


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1 (A) in paragraph (1)(D)(i), by striking 

2 ‘‘section 1886(h)’’ and inserting ‘‘sections 

3 1848(o) and 1886(h)’’; and 

4 (B) in paragraph (6)(A), by inserting after 

5 ‘‘under part B,’’ the following: ‘‘excluding ex6 penditures attributable to subsections (a)(7) 

7 and (o) of section 1848,’’; and 

8 (3) in subsection (f), by inserting ‘‘and for pay9 ments under subsection (l)’’ after ‘‘with the organi10 zation’’. 

11 (e) CONFORMING AMENDMENTS TO E-PRE12 SCRIBING.— 

13 (1) Section 1848(a)(5)(A) of the Social Security 

14 Act (42 U.S.C. 1395w–4(a)(5)(A)) is amended— 

15 (A) in clause (i), by striking ‘‘or any sub16 sequent year’’ and inserting ‘‘, 2013, 2014, or 

17 2015’’; and 

18 (B) in clause (ii), by striking ‘‘and each 

19 subsequent year’’ and inserting ‘‘and 2015’’. 

20 (2) Section 1848(m)(2) of such Act (42 U.S.C. 

21 1395w–4(m)(2)) is amended— 

22 (A) in subparagraph (A), by striking ‘‘For 

23 2009’’ and inserting ‘‘Subject to subparagraph 

24 (D), for 2009’’; and 


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

2 subparagraph: 

3 ‘‘(D) LIMITATION WITH RESPECT TO EHR

4 INCENTIVE PAYMENTS.—The provisions of this 

5 paragraph shall not apply to an eligible profes6 sional (or, in the case of a group practice under 

7 paragraph (3)(C), to the group practice) if, for 

8 the reporting period the eligible professional (or 

9 group practice) receives an incentive payment 

10 under subsection (o)(1)(A) with respect to a 

11 certified EHR technology (as defined in sub12 section (o)(4)) that has the capability of elec13 tronic prescribing.’’. 

14 SEC. 4312. INCENTIVES FOR HOSPITALS. 

15 (a) INCENTIVE PAYMENT.—Section 1886 of the So16 cial Security Act (42 U.S.C. 1395ww) is amended by add17 ing at the end the following new subsection: 

18 ‘‘(n) INCENTIVES FOR ADOPTION AND MEANINGFUL

19 USE OF CERTIFIED EHR TECHNOLOGY.— 

20 ‘‘(1) IN GENERAL.—Subject to the succeeding 

21 provisions of this subsection, with respect to inpa22 tient hospital services furnished by an eligible hos23 pital during a payment year (as defined in para24 graph (2)(G)), if the eligible hospital is a meaningful 

25 EHR user (as determined under paragraph (3)) for 


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1 the reporting period with respect to such year, in ad2 dition to the amount otherwise paid under this sec3 tion, there also shall be paid to the eligible hospital, 

4 from the Federal Hospital Insurance Trust Fund es5 tablished under section 1817, an amount equal to 

6 the applicable amount specified in paragraph (2)(A) 

7 for the hospital for such payment year. 

8 ‘‘(2) PAYMENT AMOUNT.— 

9 ‘‘(A) IN GENERAL.—Subject to the suc10 ceeding subparagraphs of this paragraph, the 

11 applicable amount specified in this subpara12 graph for an eligible hospital for a payment 

13 year is equal to the product of the following: 

14 ‘‘(i) INITIAL AMOUNT.—The sum of— 

15 ‘‘(I) the base amount specified in 

16 subparagraph (B); plus 

17 ‘‘(II) the discharge related 

18 amount specified in subparagraph (C) 

19 for a 12-month period selected by the 

20 Secretary with respect to such pay21 ment year. 

22 ‘‘(ii) MEDICARE SHARE.—The Medi23 care share as specified in subparagraph 

24 (D) for the hospital for a period selected 


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1 by the Secretary with respect to such pay2 ment year. 

3 ‘‘(iii) TRANSITION FACTOR.—The 

4 transition factor specified in subparagraph 

5 (E) for the hospital for the payment year. 

6 ‘‘(B) BASE AMOUNT.—The base amount 

7 specified in this subparagraph is $2,000,000. 

8 ‘‘(C) DISCHARGE RELATED AMOUNT.—The 

9 discharge related amount specified in this sub10 paragraph for a 12-month period selected by 

11 the Secretary shall be determined as the sum of 

12 the amount, based upon total discharges (re13 gardless of any source of payment) for the pe14 riod, for each discharge up to the 23,000th dis15 charge as follows: 

16 ‘‘(i) For the 1,150th through the 

17 9,200th discharge, $200. 

18 ‘‘(ii) For the 9,201st through the 

19 13,800th discharge, 50 percent of the 

20 amount specified in clause (i). 

21 ‘‘(iii) For the 13,801st through the 

22 23,000th discharge, 30 percent of the 

23 amount specified in clause (i). 

24 ‘‘(D) MEDICARE SHARE.—The Medicare 

25 share specified under this subparagraph for a 


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1 hospital for a period selected by the Secretary 

2 for a payment year is equal to the fraction— 

3 ‘‘(i) the numerator of which is the 

4 sum (for such period and with respect to 

5 the hospital) of— 

6 ‘‘(I) the number of inpatient-bed7 days (as established by the Secretary) 

8 which are attributable to individuals 

9 with respect to whom payment may be 

10 made under part A; and 

11 ‘‘(II) the number of inpatient12 bed-days (as so established) which are 

13 attributable to individuals who are en14 rolled with a Medicare Advantage or15 ganization under part C; and 

16 ‘‘(ii) the denominator of which is the 

17 product of— 

18 ‘‘(I) the total number of inpa19 tient-bed-days with respect to the hos20 pital during such period; and 

21 ‘‘(II) the total amount of the hos22 pital’s charges during such period, not 

23 including any charges that are attrib24 utable to charity care (as such term is 

25 used for purposes of hospital cost reVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00154 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 porting under this title), divided by 

2 the total amount of the hospital’s 

3 charges during such period. 

4 Insofar as the Secretary determines that data 

5 are not available on charity care necessary to 

6 calculate the portion of the formula specified in 

7 clause (ii)(II), the Secretary shall use data on 

8 uncompensated care and may adjust such data 

9 so as to be an appropriate proxy for charity 

10 care including a downward adjustment to elimi11 nate bad debt data from uncompensated care 

12 data. In the absence of the data necessary, with 

13 respect to a hospital, for the Secretary to com14 pute the amount described in clause (ii)(II), the 

15 amount under such clause shall be deemed to 

16 be 1. In the absence of data, with respect to a 

17 hospital, necessary to compute the amount de18 scribed in clause (i)(II), the amount under such 

19 clause shall be deemed to be 0. 

20 ‘‘(E) TRANSITION FACTOR SPECIFIED.— 

21 ‘‘(i) IN GENERAL.—Subject to clause 

22 (ii), the transition factor specified in this 

23 subparagraph for an eligible hospital for a 

24 payment year is as follows: 


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1 ‘‘(I) For the first payment year 

2 for such hospital, 1. 

3 ‘‘(II) For the second payment 

year for such hospital, 3 4 ⁄4. 

5 ‘‘(III) For the third payment 

year for such hospital, 1 6 ⁄2. 

7 ‘‘(IV) For the fourth payment 

year for such hospital, 1 8 ⁄4. 

9 ‘‘(V) For any succeeding pay10 ment year for such hospital, 0. 

11 ‘‘(ii) PHASE DOWN FOR ELIGIBLE

12 HOSPITALS FIRST ADOPTING EHR AFTER

13 2013.—If the first payment year for an eli14 gible hospital is after 2013, then the tran15 sition factor specified in this subparagraph 

16 for a payment year for such hospital is the 

17 same as the amount specified in clause (i) 

18 for such payment year for an eligible hos19 pital for which the first payment year is 

20 2013. If the first payment year for an eli21 gible hospital is after 2015 then the transi22 tion factor specified in this subparagraph 

23 for such hospital and for such year and 

24 any subsequent year shall be 0. 


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1 ‘‘(F) FORM OF PAYMENT.—The payment 

2 under this subsection for a payment year may 

3 be in the form of a single consolidated payment 

4 or in the form of such periodic installments as 

5 the Secretary may specify. 

6 ‘‘(G) PAYMENT YEAR DEFINED.— 

7 ‘‘(i) IN GENERAL.—For purposes of 

8 this subsection, the term ‘payment year’ 

9 means a fiscal year beginning with fiscal 

10 year 2011. 

11 ‘‘(ii) FIRST, SECOND, ETC. PAYMENT

12 YEAR.—The term ‘first payment year’ 

13 means, with respect to inpatient hospital 

14 services furnished by an eligible hospital, 

15 the first fiscal year for which an incentive 

16 payment is made for such services under 

17 this subsection. The terms ‘second pay18 ment year’, ‘third payment year’, and 

19 ‘fourth payment year’ mean, with respect 

20 to an eligible hospital, each successive year 

21 immediately following the first payment 

22 year for that hospital. 

23 ‘‘(3) MEANINGFUL EHR USER.— 

24 ‘‘(A) IN GENERAL.—For purposes of para25 graph (1), an eligible hospital shall be treated 


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1 as a meaningful EHR user for a reporting pe2 riod for a payment year (or, for purposes of 

3 subsection (b)(3)(B)(ix), for a reporting period 

4 under such subsection for a fiscal year) if each 

5 of the following requirements are met: 

6 ‘‘(i) MEANINGFUL USE OF CERTIFIED

7 EHR TECHNOLOGY.—The eligible hospital 

8 demonstrates to the satisfaction of the Sec9 retary, in accordance with subparagraph 

10 (C)(i), that during such period the hospital 

11 is using certified EHR technology in a 

12 meaningful manner. 

13 ‘‘(ii) INFORMATION EXCHANGE.—The 

14 eligible hospital demonstrates to the satis15 faction of the Secretary, in accordance 

16 with subparagraph (C)(i), that during such 

17 period such certified EHR technology is 

18 connected in a manner that provides, in 

19 accordance with law and standards appli20 cable to the exchange of information, for 

21 the electronic exchange of health informa22 tion to improve the quality of health care, 

23 such as promoting care coordination. 

24 ‘‘(iii) REPORTING ON MEASURES

25 USING EHR.—Subject to subparagraph 


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1 (B)(ii) and using such certified EHR tech2 nology, the eligible hospital submits infor3 mation for such period, in a form and 

4 manner specified by the Secretary, on such 

5 clinical quality measures and such other 

6 measures as selected by the Secretary 

7 under subparagraph (B)(i). 

8 The Secretary shall seek to improve the use of 

9 electronic health records and health care quality 

10 over time by requiring more stringent measures 

11 of meaningful use selected under this para12 graph. 

13 ‘‘(B) REPORTING ON MEASURES.— 

14 ‘‘(i) SELECTION.—The Secretary shall 

15 select measures for purposes of subpara16 graph (A)(iii) but only consistent with the 

17 following: 

18 ‘‘(I) The Secretary shall provide 

19 preference to clinical quality measures 

20 that have been selected for purposes 

21 of applying subsection (b)(3)(B)(viii) 

22 or that have been endorsed by the en23 tity with a contract with the Secretary 

24 under section 1890(a). 


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1 ‘‘(II) Prior to any measure (other 

2 than a clinical quality measure that 

3 has been selected for purposes of ap4 plying subsection (b)(3)(B)(viii)) 

5 being selected under this subpara6 graph, the Secretary shall publish in 

7 the Federal Register such measure 

8 and provide for a period of public 

9 comment on such measure. 

10 ‘‘(ii) LIMITATIONS.—The Secretary 

11 may not require the electronic reporting of 

12 information on clinical quality measures 

13 under subparagraph (A)(iii) unless the 

14 Secretary has the capacity to accept the in15 formation electronically, which may be on 

16 a pilot basis. 

17 ‘‘(iii) COORDINATION OF REPORTING

18 OF INFORMATION.—In selecting such 

19 measures, and in establishing the form and 

20 manner for reporting measures under sub21 paragraph (A)(iii), the Secretary shall seek 

22 to avoid redundant or duplicative reporting 

23 with reporting otherwise required, includ24 ing reporting under subsection 

25 (b)(3)(B)(viii). 


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1 ‘‘(C) DEMONSTRATION OF MEANINGFUL

2 USE OF CERTIFIED EHR TECHNOLOGY AND IN3 FORMATION EXCHANGE.— 

4 ‘‘(i) IN GENERAL.—A hospital may 

5 satisfy the demonstration requirement of 

6 clauses (i) and (ii) of subparagraph (A) 

7 through means specified by the Secretary, 

8 which may include— 

9 ‘‘(I) an attestation; 

10 ‘‘(II) the submission of claims 

11 with appropriate coding (such as a 

12 code indicating that inpatient care 

13 was documented using certified EHR 

14 technology); 

15 ‘‘(III) a survey response; 

16 ‘‘(IV) reporting under subpara17 graph (A)(iii); and 

18 ‘‘(V) other means specified by the 

19 Secretary. 

20 ‘‘(ii) USE OF PART D DATA.—Not21 withstanding sections 1860D–15(d)(2)(B) 

22 and 1860D–15(f)(2), the Secretary may 

23 use data regarding drug claims submitted 

24 for purposes of section 1860D–15 that are 


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1 necessary for purposes of subparagraph 

2 (A). 

3 ‘‘(4) APPLICATION.— 

4 ‘‘(A) LIMITATIONS ON REVIEW.—There 

5 shall be no administrative or judicial review 

6 under section 1869, section 1878, or otherwise 

7 of the determination of any incentive payment 

8 under this subsection and the payment adjust9 ment under subsection (b)(3)(B)(ix), including 

10 the determination of a meaningful EHR user 

11 under paragraph (3), determination of meas12 ures applicable to services furnished by eligible 

13 hospitals under this subsection, and the excep14 tion under subsection (b)(3)(B)(ix)(II). 

15 ‘‘(B) POSTING ON WEBSITE.—The Sec16 retary shall post on the Internet website of the 

17 Centers for Medicare & Medicaid Services, in an 

18 easily understandable format, a list of the 

19 names of the eligible hospitals that are mean20 ingful EHR users under this subsection or sub21 section (b)(3)(B)(ix) and other relevant data as 

22 determined appropriate by the Secretary. The 

23 Secretary shall ensure that a hospital has the 

24 opportunity to review the other relevant data 


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1 that are to be made public with respect to the 

2 hospital prior to such data being made public. 

3 ‘‘(5) CERTIFIED EHR TECHNOLOGY DEFINED.— 

4 The term ‘certified EHR technology’ has the mean5 ing given such term in section 1848(o)(4). 

6 ‘‘(6) DEFINITIONS.—For purposes of this sub7 section: 

8 ‘‘(A) ELIGIBLE HOSPITAL.—The term ‘eli9 gible hospital’ means a subsection (d) hospital. 

10 ‘‘(B) REPORTING PERIOD.—The term ‘re11 porting period’ means any period (or periods), 

12 with respect to a payment year, as specified by 

13 the Secretary.’’. 

14 (b) INCENTIVE MARKET BASKET ADJUSTMENT.— 

15 Section 1886(b)(3)(B) of the Social Security Act (42 

16 U.S.C. 1395ww(b)(3)(B)) is amended— 

17 (1) in clause (viii)(I), by inserting ‘‘(or, begin18 ning with fiscal year 2016, by one-quarter)’’ after 

19 ‘‘2.0 percentage points’’; and 

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

21 clause: 

22 ‘‘(ix)(I) For purposes of clause (i) for fiscal year 

23 2016 and each subsequent fiscal year, in the case of an 

24 eligible hospital (as defined in subsection (n)(6)(A)) that 

25 is not a meaningful EHR user (as defined in subsection 


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1 (n)(3)) for the reporting period for such fiscal year, three2 quarters of the applicable percentage increase otherwise 

3 applicable under clause (i) for such fiscal year shall be 

reduced by 331⁄3 percent for fiscal year 2016, 662 4 ⁄3 per5 cent for fiscal year 2017, and 100 percent for fiscal year 

6 2018 and each subsequent fiscal year. Such reduction 

7 shall apply only with respect to the fiscal year involved 

8 and the Secretary shall not take into account such reduc9 tion in computing the applicable percentage increase under 

10 clause (i) for a subsequent fiscal year. 

11 ‘‘(II) The Secretary may, on a case-by-case basis, ex12 empt a subsection (d) hospital from the application of sub13 clause (I) with respect to a fiscal year if the Secretary 

14 determines, subject to annual renewal, that requiring such 

15 hospital to be a meaningful EHR user during such fiscal 

16 year would result in a significant hardship, such as in the 

17 case of a hospital in a rural area without sufficient Inter18 net access. In no case may a hospital be granted an ex19 emption under this subclause for more than 5 years. 

20 ‘‘(III) For fiscal year 2016 and each subsequent fis21 cal year, a State in which hospitals are paid for services 

22 under section 1814(b)(3) shall adjust the payments to 

23 each subsection (d) hospital in the State that is not a 

24 meaningful EHR user (as defined in subsection (n)(3)) 

25 in a manner that is designed to result in an aggregate 


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1 reduction in payments to hospitals in the State that is 

2 equivalent to the aggregate reduction that would have oc3 curred if payments had been reduced to each subsection 

4 (d) hospital in the State in a manner comparable to the 

5 reduction under the previous provisions of this clause. The 

6 State shall report to the Secretary the methodology it will 

7 use to make the payment adjustment under the previous 

8 sentence. 

9 ‘‘(IV) For purposes of this clause, the term ‘reporting 

10 period’ means, with respect to a fiscal year, any period 

11 (or periods), with respect to the fiscal year, as specified 

12 by the Secretary.’’. 

13 (c) APPLICATION TO CERTAIN HMO-AFFILIATED

14 ELIGIBLE HOSPITALS.—Section 1853 of the Social Secu15 rity Act (42 U.S.C. 1395w–23), as amended by section 

16 4311(c), is further amended by adding at the end the fol17 lowing new subsection: 

18 ‘‘(m) APPLICATION OF ELIGIBLE HOSPITAL INCEN19 TIVES FOR CERTAIN MA ORGANIZATIONS FOR ADOPTION

20 AND MEANINGFUL USE OF CERTIFIED EHR TECH21 NOLOGY.— 

22 ‘‘(1) APPLICATION.—Subject to paragraphs (3) 

23 and (4), in the case of a qualifying MA organization, 

24 the provisions of sections 1886(n) and 

25 1886(b)(3)(B)(ix) shall apply with respect to eligible 


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1 hospitals described in paragraph (2) of the organiza2 tion which the organization attests under subsection 

3 (l)(6) to be meaningful EHR users in a similar man4 ner as they apply to eligible hospitals under such 

5 sections. Incentive payments under paragraph (3) 

6 shall be made to and payment adjustments under 

7 paragraph (4) shall apply to such qualifying organi8 zations. 

9 ‘‘(2) ELIGIBLE HOSPITAL DESCRIBED.—With 

10 respect to a qualifying MA organization, an eligible 

11 hospital described in this paragraph is an eligible 

12 hospital that is under common corporate governance 

13 with such organization and serves individuals en14 rolled under an MA plan offered by such organiza15 tion. 

16 ‘‘(3) ELIGIBLE HOSPITAL INCENTIVE PAY17 MENTS.— 

18 ‘‘(A) IN GENERAL.—In applying section 

19 1886(n)(2) under paragraph (1), instead of the 

20 additional payment amount under section 

21 1886(n)(2), there shall be substituted an 

22 amount determined by the Secretary to be simi23 lar to the estimated amount in the aggregate 

24 that would be payable if payment for services 

25 furnished by such hospitals was payable under 


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1 part A instead of this part. In implementing the 

2 previous sentence, the Secretary— 

3 ‘‘(i) shall, insofar as data to deter4 mine the discharge related amount under 

5 section 1886(n)(2)(C) for an eligible hos6 pital are not available to the Secretary, use 

7 such alternative data and methodology to 

8 estimate such discharge related amount as 

9 the Secretary determines appropriate; and 

10 ‘‘(ii) shall, insofar as data to deter11 mine the medicare share described in sec12 tion 1886(n)(2)(D) for an eligible hospital 

13 are not available to the Secretary, use such 

14 alternative data and methodology to esti15 mate such share, which data and method16 ology may include use of the inpatient bed 

17 days (or discharges) with respect to an eli18 gible hospital during the appropriate pe19 riod which are attributable to both individ20 uals for whom payment may be made 

21 under part A or individuals enrolled in an 

22 MA plan under a Medicare Advantage or23 ganization under this part as a proportion 

24 of the total number of patient-bed-days (or 


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1 discharges) with respect to such hospital 

2 during such period. 

3 ‘‘(B) AVOIDING DUPLICATION OF PAY4 MENTS.— 

5 ‘‘(i) IN GENERAL.—In the case of a 

6 hospital that for a payment year is an eli7 gible hospital described in paragraph (2), 

8 is an eligible hospital under section 

9 1886(n), and for which at least one-third 

10 of their discharges (or bed-days) of Medi11 care patients for the year are covered 

12 under part A, payment for the payment 

13 year shall be made only under section 

14 1886(n) and not under this subsection. 

15 ‘‘(ii) METHODS.—In the case of a 

16 hospital that is an eligible hospital de17 scribed in paragraph (2) and also is eligi18 ble for an incentive payment under section 

19 1886(n) but is not described in clause (i) 

20 for the same payment period, the Secretary 

21 shall develop a process— 

22 ‘‘(I) to ensure that duplicate pay23 ments are not made with respect to 

24 an eligible hospital both under this 


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1 subsection and under section 1886(n); 

2 and 

3 ‘‘(II) to collect data from Medi4 care Advantage organizations to en5 sure against such duplicate payments. 

6 ‘‘(4) PAYMENT ADJUSTMENT.— 

7 ‘‘(A) Subject to paragraph (3), in the case 

8 of a qualifying MA organization (as defined in 

9 section 1853(l)(5)), if, according to the attesta10 tion of the organization submitted under sub11 section (l)(6) for an applicable period, one or 

12 more eligible hospitals (as defined in section 

13 1886(n)(6)(A)) that are under common cor14 porate governance with such organization and 

15 that serve individuals enrolled under a plan of16 fered by such organization are not meaningful 

17 EHR users (as defined in section 1886(n)(3)) 

18 with respect to a period, the payment amount 

19 payable under this section for such organization 

20 for such period shall be the percent specified in 

21 subparagraph (B) for such period of the pay22 ment amount otherwise provided under this sec23 tion for such period. 

24 ‘‘(B) SPECIFIED PERCENT.—The percent 

25 specified under this subparagraph for a year is 


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1 100 percent minus a number of percentage 

2 points equal to the product of— 

3 ‘‘(i) the number of the percentage 

4 point reduction effected under section 

5 1886(b)(3)(B)(ix)(I) for the period; and 

6 ‘‘(ii) the Medicare hospital expendi7 ture proportion specified in subparagraph 

8 (C) for the year. 

9 ‘‘(C) MEDICARE HOSPITAL EXPENDITURE

10 PROPORTION.—The Medicare hospital expendi11 ture proportion under this subparagraph for a 

12 year is the Secretary’s estimate of the propor13 tion, of the expenditures under parts A and B 

14 that are not attributable to this part, that are 

15 attributable to expenditures for inpatient hos16 pital services. 

17 ‘‘(D) APPLICATION OF PAYMENT ADJUST18 MENT.—In the case that a qualifying MA orga19 nization attests that not all eligible hospitals 

20 are meaningful EHR users with respect to an 

21 applicable period, the Secretary shall apply the 

22 payment adjustment under this paragraph 

23 based on a methodology specified by the Sec24 retary, taking into account the proportion of 

25 such eligible hospitals, or discharges from such 


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1 hospitals, that are not meaningful EHR users 

2 for such period.’’. 

3 (d) CONFORMING AMENDMENTS.— 

4 (1) Section 1814(b) of the Social Security Act 

5 (42 U.S.C. 1395f(b)) is amended— 

6 (A) in paragraph (3), in the matter pre7 ceding subparagraph (A), by inserting ‘‘, sub8 ject to section 1886(d)(3)(B)(ix)(III),’’ after 

9 ‘‘then’’; and 

10 (B) by adding at the end the following: 

11 ‘‘For purposes of applying paragraph (3), there 

12 shall be taken into account incentive payments, 

13 and payment adjustments under subsection 

14 (b)(3)(B)(ix) or (n) of section 1886.’’. 

15 (2) Section 1851(i)(1) of the Social Security 

16 Act (42 U.S.C. 1395w–21(i)(1)) is amended by 

17 striking ‘‘and 1886(h)(3)(D)’’ and inserting 

18 ‘‘1886(h)(3)(D), and 1853(m)’’. 

19 (3) Section 1853 of the Social Security Act (42 

20 U.S.C. 1395w–23), as amended by section 

21 4311(d)(1), is amended— 

22 (A) in subsection (c)— 

23 (i) in paragraph (1)(D)(i), by striking 

24 ‘‘1848(o)’’ and inserting ‘‘, 1848(o), and 

25 1886(n)’’; and 


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1 (ii) in paragraph (6)(A), by inserting 

2 ‘‘and subsections (b)(3)(B)(ix) and (n) of 

3 section 1886’’ after ‘‘section 1848’’; and 

4 (B) in subsection (f), by inserting ‘‘and 

5 subsection (m)’’ after ‘‘under subsection (l)’’. 

6 SEC. 4313. TREATMENT OF PAYMENTS AND SAVINGS; IM7 PLEMENTATION FUNDING. 

8 (a) PREMIUM HOLD HARMLESS.— 

9 (1) IN GENERAL.—Section 1839(a)(1) of the 

10 Social Security Act (42 U.S.C. 1395r(a)(1)) is 

11 amended by adding at the end the following: ‘‘In ap12 plying this paragraph there shall not be taken into 

13 account additional payments under section 1848(o) 

14 and section 1853(l)(3) and the Government con15 tribution under section 1844(a)(3).’’. 

16 (2) PAYMENT.—Section 1844(a) of such Act 

17 (42 U.S.C. 1395w(a)) is amended— 

18 (A) in paragraph (2), by striking the pe19 riod at the end and inserting ‘‘; plus’’; and 

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

21 paragraph: 

22 ‘‘(3) a Government contribution equal to the 

23 amount of payment incentives payable under sec24 tions 1848(o) and 1853(l)(3).’’. 


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1 (b) MEDICARE IMPROVEMENT FUND.—Section 1898 

2 of the Social Security Act (42 U.S.C. 1395iii), as added 

3 by section 7002(a) of the Supplemental Appropriations 

4 Act, 2008 (Public Law 110–252) and as amended by sec5 tion 188(a)(2) of the Medicare Improvements for Patients 

6 and Providers Act of 2008 (Public Law 110–275; 122 

7 Stat. 2589) and by section 6 of the QI Program Supple8 mental Funding Act of 2008, is amended— 

9 (1) in subsection (a)— 

10 (A) by inserting ‘‘medicare’’ before ‘‘fee11 for-service’’; and 

12 (B) by inserting before the period at the 

13 end the following: ‘‘including, but not limited 

14 to, an increase in the conversion factor under 

15 section 1848(d) to address, in whole or in part, 

16 any projected shortfall in the conversion factor 

17 for 2014 relative to the conversion factor for 

18 2008 and adjustments to payments for items 

19 and services furnished by providers of services 

20 and suppliers under such original medicare fee21 for-service program’’; and 

22 (2) in subsection (b)— 

23 (A) in paragraph (1), by striking ‘‘during 

24 fiscal year 2014,’’ and all that follows and in25 serting the following: ‘‘during— 


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1 ‘‘(A) fiscal year 2014, $22,290,000,000; 

2 and 

3 ‘‘(B) fiscal year 2020 and each subsequent 

4 fiscal year, the Secretary’s estimate, as of July 

5 1 of the fiscal year, of the aggregate reduction 

6 in expenditures under this title during the pre7 ceding fiscal year directly resulting from the re8 duction in payment amounts under sections 

9 1848(a)(7), 1853(l)(4), 1853(m)(4), and 

10 1886(b)(3)(B)(ix).’’; and 

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

12 paragraph: 

13 ‘‘(4) NO EFFECT ON PAYMENTS IN SUBSE14 QUENT YEARS.—In the case that expenditures from 

15 the Fund are applied to, or otherwise affect, a pay16 ment rate for an item or service under this title for 

17 a year, the payment rate for such item or service 

18 shall be computed for a subsequent year as if such 

19 application or effect had never occurred.’’. 

20 (c) IMPLEMENTATION FUNDING.—In addition to 

21 funds otherwise available, out of any funds in the Treas22 ury not otherwise appropriated, there are appropriated to 

23 the Secretary of Health and Human Services for the Cen24 ter for Medicare & Medicaid Services Program Manage25 ment Account, $60,000,000 for each of fiscal years 2009 


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1 through 2015 and $30,000,000 for each succeeding fiscal 

2 year through fiscal year 2019, which shall be available for 

3 purposes of carrying out the provisions of (and amend4 ments made by) this part. Amounts appropriated under 

5 this subsection for a fiscal year shall be available until ex6 pended. 

7 SEC. 4314. STUDY ON APPLICATION OF EHR PAYMENT IN8 CENTIVES FOR PROVIDERS NOT RECEIVING 

9 OTHER INCENTIVE PAYMENTS. 

10 (a) STUDY.— 

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

12 Human Services shall conduct a study to determine 

13 the extent to which and manner in which payment 

14 incentives (such as under title XVIII or XIX of the 

15 Social Security Act) and other funding for purposes 

16 of implementing and using certified EHR technology 

17 (as defined in section 3000 of the Public Health 

18 Service Act) should be made available to health care 

19 providers who are receiving minimal or no payment 

20 incentives or other funding under this Act, under 

21 title XVIII or XIX of the Social Security Act, or 

22 otherwise, for such purposes. 

23 (2) DETAILS OF STUDY.—Such study shall in24 clude an examination of— 


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1 (A) the adoption rates of certified EHR 

2 technology by such health care providers; 

3 (B) the clinical utility of such technology 

4 by such health care providers; 

5 (C) whether the services furnished by such 

6 health care providers are appropriate for or 

7 would benefit from the use of such technology; 

8 (D) the extent to which such health care 

9 providers work in settings that might otherwise 

10 receive an incentive payment or other funding 

11 under this Act, title XVIII or XIX of the Social 

12 Security Act, or otherwise; 

13 (E) the potential costs and the potential 

14 benefits of making payment incentives and 

15 other funding available to such health care pro16 viders; and 

17 (F) any other issues the Secretary deems 

18 to be appropriate. 

19 (b) REPORT.—Not later than June 30, 2010, the 

20 Secretary shall submit to Congress a report on the find21 ings and conclusions of the study conducted under sub22 section (a). 


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1 PART III—MEDICAID FUNDING 

2 SEC. 4321. MEDICAID PROVIDER HIT ADOPTION AND OPER3 ATION PAYMENTS; IMPLEMENTATION FUND4 ING. 

5 (a) IN GENERAL.—Section 1903 of the Social Secu6 rity Act (42 U.S.C. 1396b) is amended— 

7 (1) in subsection (a)(3)— 

8 (A) by striking ‘‘and’’ at the end of sub9 paragraph (D); 

10 (B) by striking ‘‘plus’’ at the end of sub11 paragraph (E) and inserting ‘‘and’’; and 

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

13 subparagraph: 

14 ‘‘(F)(i) 100 percent of so much of the 

15 sums expended during such quarter as are at16 tributable to payments for certified EHR tech17 nology (and support services including mainte18 nance and training that is for, or is necessary 

19 for the adoption and operation of, such tech20 nology) by Medicaid providers described in sub21 section (t)(1); and 

22 ‘‘(ii) 90 percent of so much of the sums ex23 pended during such quarter as are attributable 

24 to payments for reasonable administrative ex25 penses related to the administration of pay26 ments described in clause (i) if the State meets 


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1 the condition described in subsection (t)(9); 

2 plus’’; and 

3 (2) by inserting after subsection (s) the fol4 lowing new subsection: 

5 ‘‘(t)(1) For purposes of subsection (a)(3)(F), the pay6 ments for certified EHR technology (and support services 

7 including maintenance that is for, or is necessary for the 

8 operation of, such technology) by Medicaid providers de9 scribed in this paragraph are payments made by the State 

10 in accordance with this subsection of 85 percent of the 

11 net allowable costs of Medicaid providers (as defined in 

12 paragraph (2)) for such technology (and support services). 

13 ‘‘(2) In this subsection and subsection (a)(3)(F), the 

14 term ‘Medicaid provider’ means— 

15 ‘‘(A) an eligible professional (as defined in 

16 paragraph (3)(B)) who is not hospital-based and has 

17 at least 30 percent of the professional’s patient vol18 ume (as estimated in accordance with standards es19 tablished by the Secretary) attributable to individ20 uals who are receiving medical assistance under this 

21 title; and 

22 ‘‘(B) (i) a children’s hospital, (ii) an acute-care 

23 hospital that is not described in clause (i) and that 

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1 tablished by the Secretary) attributable to individ2 uals who are receiving medical assistance under this 

3 title, or (iii) a Federally-qualified health center or 

4 rural health clinic that has at least 30 percent of the 

5 center’s or clinic’s patient volume (as estimated in 

6 accordance with standards established by the Sec7 retary) attributable to individuals who are receiving 

8 medical assistance under this title. 

9 An eligible professional shall not qualify as a Medicaid 

10 provider under this subsection unless the eligible profes11 sional has waived, in a manner specified by the Secretary, 

12 any right to payment under section 1848(o) with respect 

13 to the adoption or support of certified EHR technology 

14 by the professional. In applying clauses (ii) and (iii) of 

15 subparagraph (B), the standards established by the Sec16 retary for patient volume shall include individuals enrolled 

17 in a Medicaid managed care plan (under section 1903(m) 

18 or section 1932). 

19 ‘‘(3) In this subsection and subsection (a)(3)(F): 

20 ‘‘(A) The term ‘certified EHR technology’ 

21 means a qualified electronic health record (as de22 fined in 3000(13) of the Public Health Service Act) 

23 that is certified pursuant to section 3001(c)(5) of 

24 such Act as meeting standards adopted under sec25 tion 3004 of such Act that are applicable to the type 


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1 of record involved (as determined by the Secretary, 

2 such as an ambulatory electronic health record for 

3 office-based physicians or an inpatient hospital elec4 tronic health record for hospitals). 

5 ‘‘(B) The term ‘eligible professional’ means a 

6 physician as defined in paragraphs (1) and (2) of 

7 section 1861(r), and includes a nurse mid-wife and 

8 a nurse practitioner. 

9 ‘‘(C) The term ‘hospital-based’ means, with re10 spect to an eligible professional, a professional (such 

11 as a pathologist, anesthesiologist, or emergency phy12 sician) who furnishes substantially all of the individ13 ual’s professional services in a hospital setting 

14 (whether inpatient or outpatient) and through the 

15 use of the facilities and equipment, including com16 puter equipment, of the hospital. 

17 ‘‘(4)(A) The term ‘allowable costs’ means, with re18 spect to certified EHR technology of a Medicaid provider, 

19 costs of such technology (and support services including 

20 maintenance and training that is for, or is necessary for 

21 the adoption and operation of, such technology) as deter22 mined by the Secretary to be reasonable. 

23 ‘‘(B) The term ‘net allowable costs’ means allowable 

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1 rectly attributable to payment for certified EHR tech2 nology or services described in subparagraph (A). 

3 ‘‘(C) In no case shall— 

4 ‘‘(i) the aggregate allowable costs under this 

5 subsection (covering one or more years) with respect 

6 to a Medicaid provider described in paragraph 

7 (2)(A) for purchase and initial implementation of 

8 certified EHR technology (and services described in 

9 subparagraph (A)) exceed $25,000 or include costs 

10 over a period of longer than 5 years; 

11 ‘‘(ii) for costs not described in clause (i) relat12 ing to the operation, maintenance, or use of certified 

13 EHR technology, the annual allowable costs under 

14 this subsection with respect to such a Medicaid pro15 vider for costs not described in clause (i) for any 

16 year exceed $10,000; 

17 ‘‘(iii) payment described in paragraph (1) for 

18 costs described in clause (ii) be made with respect 

19 to such a Medicaid provider over a period of more 

20 than 5 years; 

21 ‘‘(iv) the aggregate allowable costs under this 

22 subsection with respect to such a Medicaid provider 

23 for all costs exceed $75,000; or 

24 ‘‘(v) the allowable costs, whether for purchase 

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1 wise, for a Medicaid provider described in paragraph 

2 (2)(B) exceed such aggregate or annual limitation as 

3 the Secretary shall establish, based on an amount 

4 determined by the Secretary as being adequate to 

5 adopt and maintain certified EHR technology, con6 sistent with paragraph (6). 

7 ‘‘(5) Payments described in paragraph (1) are not in 

8 accordance with this subsection unless the following re9 quirements are met: 

10 ‘‘(A) The State provides assurances satisfactory 

11 to the Secretary that amounts received under sub12 section (a)(3)(F) with respect to costs of a Medicaid 

13 provider are paid directly to such provider without 

14 any deduction or rebate. 

15 ‘‘(B) Such Medicaid provider is responsible for 

16 payment of the costs described in such paragraph 

17 that are not provided under this title. 

18 ‘‘(C) With respect to payments to such Med19 icaid provider for costs other than costs related to 

20 the initial adoption of certified EHR technology, the 

21 Medicaid provider demonstrates meaningful use of 

22 certified EHR technology through a means that is 

23 approved by the State and acceptable to the Sec24 retary, and that may be based upon the methodolo25 gies applied under section 1848(o) or 1886(n). 


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1 ‘‘(D) To the extent specified by the Secretary, 

2 the certified EHR technology is compatible with 

3 State or Federal administrative management sys4 tems. 

5 ‘‘(6)(A) In no case shall the payments described in 

6 paragraph (1), with respect to a hospital, exceed in the 

7 aggregate the product of— 

8 ‘‘(i) the overall hospital EHR amount for the 

9 hospital computed under subparagraph (B); and 

10 ‘‘(ii) the Medicaid share for such hospital com11 puted under subparagraph (C). 

12 ‘‘(B) For purposes of this paragraph, the overall hos13 pital EHR amount, with respect to a hospital, is the sum 

14 of the applicable amounts specified in section 

15 1886(n)(2)(A) for such hospital for the first 4 payment 

16 years (as estimated by the Secretary) determined as if the 

17 Medicare share specified in clause (ii) of such section were 

18 1. The Secretary shall publish in the Federal Register the 

19 overall hospital EHR amount for each hospital eligible for 

20 payments under this subsection. In computing amounts 

21 under clause (ii) for payment years after the first payment 

22 year, the Secretary shall assume that in subsequent pay23 ment years discharges increase at the average annual rate 

24 of growth of the most recent 3 years for which discharge 

25 data are available per year. 


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1 ‘‘(C) The Medicaid share computed under this sub2 paragraph, for a hospital for a period specified by the Sec3 retary, shall be calculated in the same manner as the 

4 Medicare share under section 1886(n)(2)(D) for such a 

5 hospital and period, except that there shall be substituted 

6 for the numerator under clause (i) of such section the 

7 amount that is equal to the number of inpatient-bed-days 

8 (as established by the Secretary) which are attributable 

9 to individuals who are receiving medical assistance under 

10 this title and who are not described in section 

11 1886(n)(2)(D)(i). In computing inpatient-bed-days under 

12 the previous sentence, the Secretary shall take into ac13 count inpatient-bed-days attributable to inpatient-bed14 days that are paid for individuals enrolled in a Medicaid 

15 managed care plan (under section 1903(m) or section 

16 1932). 

17 ‘‘(7) With respect to health care providers other than 

18 hospitals, the Secretary shall ensure coordination of the 

19 different programs for payment of such health care pro20 viders for adoption or use of health information technology 

21 (including certified EHR technology), as well as payments 

22 for such health care providers provided under this title or 

23 title XVIII, to assure no duplication of funding. 

24 ‘‘(8) In carrying out paragraph (5)(C), the State and 

25 Secretary shall seek, to the maximum extent practicable, 


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1 to avoid duplicative requirements from Federal and State 

2 Governments to demonstrate meaningful use of certified 

3 EHR technology under this title and title XVIII. In doing 

4 so, the Secretary may deem satisfaction of requirements 

5 for such meaningful use for a payment year under title 

6 XVIII to be sufficient to qualify as meaningful use under 

7 this subsection. The Secretary may also specify the report8 ing periods under this subsection in order to carry out this 

9 paragraph. 

10 ‘‘(9) In order to be provided Federal financial partici11 pation under subsection (a)(3)(F)(ii), a State must dem12 onstrate to the satisfaction of the Secretary, that the 

13 State— 

14 ‘‘(A) is using the funds provided for the pur15 poses of administering payments under this sub16 section, including tracking of meaningful use by 

17 Medicaid providers; 

18 ‘‘(B) is conducting adequate oversight of the 

19 program under this subsection, including routine 

20 tracking of meaningful use attestations and report21 ing mechanisms; and 

22 ‘‘(C) is pursuing initiatives to encourage the 

23 adoption of certified EHR technology to promote 

24 health care quality and the exchange of health care 


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1 information under this title, subject to applicable 

2 laws and regulations governing such exchange. 

3 ‘‘(10) The Secretary shall periodically submit reports 

4 to the Committee on Energy and Commerce of the House 

5 of Representatives and the Committee on Finance of the 

6 Senate on status, progress, and oversight of payments 

7 under paragraph (1).’’. 

8 (b) IMPLEMENTATION FUNDING.—In addition to 

9 funds otherwise available, out of any funds in the Treas10 ury not otherwise appropriated, there are appropriated to 

11 the Secretary of Health and Human Services for the Cen12 ter for Medicare & Medicaid Services Program Manage13 ment Account, $40,000,000 for each of fiscal years 2009 

14 through 2015 and $20,000,000 for each succeeding fiscal 

15 year through fiscal year 2019, which shall be available for 

16 purposes of carrying out the provisions of (and the amend17 ments made by) this part. Amounts appropriated under 

18 this subsection for a fiscal year shall be available until ex19 pended. 

20 Subtitle D—Privacy 

21 SEC. 4400. DEFINITIONS. 

22 In this subtitle, except as specified otherwise: 

23 (1) BREACH.—The term ‘‘breach’’ means the 

24 unauthorized acquisition, access, use, or disclosure 

25 of protected health information which compromises 


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1 the security, privacy, or integrity of protected health 

2 information maintained by or on behalf of a person. 

3 Such term does not include any unintentional acqui4 sition, access, use, or disclosure of such information 

5 by an employee or agent of the covered entity or 

6 business associate involved if such acquisition, ac7 cess, use, or disclosure, respectively, was made in 

8 good faith and within the course and scope of the 

9 employment or other contractual relationship of such 

10 employee or agent, respectively, with the covered en11 tity or business associate and if such information is 

12 not further acquired, accessed, used, or disclosed by 

13 such employee or agent. 

14 (2) BUSINESS ASSOCIATE.—The term ‘‘business 

15 associate’’ has the meaning given such term in sec16 tion 160.103 of title 45, Code of Federal Regula17 tions. 

18 (3) COVERED ENTITY.—The term ‘‘covered en19 tity’’ has the meaning given such term in section 

20 160.103 of title 45, Code of Federal Regulations. 

21 (4) DISCLOSE.—The terms ‘‘disclose’’ and ‘‘dis22 closure’’ have the meaning given the term ‘‘disclo23 sure’’ in section 160.103 of title 45, Code of Federal 

24 Regulations. 


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1 (5) ELECTRONIC HEALTH RECORD.—The term 

2 ‘‘electronic health record’’ means an electronic 

3 record of health-related information on an individual 

4 that is created, gathered, managed, and consulted by 

5 authorized health care clinicians and staff. 

6 (6) HEALTH CARE OPERATIONS.—The term 

7 ‘‘health care operation’’ has the meaning given such 

8 term in section 164.501 of title 45, Code of Federal 

9 Regulations. 

10 (7) HEALTH CARE PROVIDER.—The term 

11 ‘‘health care provider’’ has the meaning given such 

12 term in section 160.103 of title 45, Code of Federal 

13 Regulations. 

14 (8) HEALTH PLAN.—The term ‘‘health plan’’ 

15 has the meaning given such term in section 1171(5) 

16 of the Social Security Act. 

17 (9) NATIONAL COORDINATOR.—The term ‘‘Na18 tional Coordinator’’ means the head of the Office of 

19 the National Coordinator for Health Information 

20 Technology established under section 3001(a) of the 

21 Public Health Service Act, as added by section 

22 4101. 

23 (10) PAYMENT.—The term ‘‘payment’’ has the 

24 meaning given such term in section 164.501 of title 

25 45, Code of Federal Regulations. 


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1 (11) PERSONAL HEALTH RECORD.—The term 

2 ‘‘personal health record’’ means an electronic record 

3 of individually identifiable health information on an 

4 individual that can be drawn from multiple sources 

5 and that is managed, shared, and controlled by or 

6 for the individual. 

7 (12) PROTECTED HEALTH INFORMATION.—The 

8 term ‘‘protected health information’’ has the mean9 ing given such term in section 160.103 of title 45, 

10 Code of Federal Regulations. 

11 (13) SECRETARY.—The term ‘‘Secretary’’ 

12 means the Secretary of Health and Human Services. 

13 (14) SECURITY.—The term ‘‘security’’ has the 

14 meaning given such term in section 164.304 of title 

15 45, Code of Federal Regulations. 

16 (15) STATE.—The term ‘‘State’’ means each of 

17 the several States, the District of Columbia, Puerto 

18 Rico, the Virgin Islands, Guam, American Samoa, 

19 and the Northern Mariana Islands. 

20 (16) TREATMENT.—The term ‘‘treatment’’ has 

21 the meaning given such term in section 164.501 of 

22 title 45, Code of Federal Regulations. 

23 (17) USE.—The term ‘‘use’’ has the meaning 

24 given such term in section 160.103 of title 45, Code 

25 of Federal Regulations. 


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1 (18) VENDOR OF PERSONAL HEALTH

2 RECORDS.—The term ‘‘vendor of personal health 

3 records’’ means an entity, other than a covered enti4 ty (as defined in paragraph (3)), that offers or 

5 maintains a personal health record. 

6 PART I—IMPROVED PRIVACY PROVISIONS AND 

7 SECURITY PROVISIONS 

8 SEC. 4401. APPLICATION OF SECURITY PROVISIONS AND 

9 PENALTIES TO BUSINESS ASSOCIATES OF 

10 COVERED ENTITIES; ANNUAL GUIDANCE ON 

11 SECURITY PROVISIONS. 

12 (a) APPLICATION OF SECURITY PROVISIONS.—Sec13 tions 164.308, 164.310, 164.312, and 164.316 of title 45, 

14 Code of Federal Regulations, shall apply to a business as15 sociate of a covered entity in the same manner that such 

16 sections apply to the covered entity. The additional re17 quirements of this title that relate to security and that 

18 are made applicable with respect to covered entities shall 

19 also be applicable to such a business associate and shall 

20 be incorporated into the business associate agreement be21 tween the business associate and the covered entity. 

22 (b) APPLICATION OF CIVIL AND CRIMINAL PEN23 ALTIES.—In the case of a business associate that violates 

24 any security provision specified in subsection (a), sections 

25 1176 and 1177 of the Social Security Act (42 U.S.C. 


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1 1320d–5, 1320d–6) shall apply to the business associate 

2 with respect to such violation in the same manner such 

3 sections apply to a covered entity that violates such secu4 rity provision. 

5 (c) ANNUAL GUIDANCE.—For the first year begin6 ning after the date of the enactment of this Act and annu7 ally thereafter, the Secretary of Health and Human Serv8 ices shall, in consultation with industry stakeholders, an9 nually issue guidance on the most effective and appro10 priate technical safeguards for use in carrying out the sec11 tions referred to in subsection (a) and the security stand12 ards in subpart C of part 164 of title 45, Code of Federal 

13 Regulations, as such provisions are in effect as of the date 

14 before the enactment of this Act. 

15 SEC. 4402. NOTIFICATION IN THE CASE OF BREACH. 

16 (a) IN GENERAL.—A covered entity that accesses, 

17 maintains, retains, modifies, records, stores, destroys, or 

18 otherwise holds, uses, or discloses unsecured protected 

19 health information (as defined in subsection (h)(1)) shall, 

20 in the case of a breach of such information that is discov21 ered by the covered entity, notify each individual whose 

22 unsecured protected health information has been, or is 

23 reasonably believed by the covered entity to have been, 

24 accessed, acquired, or disclosed as a result of such breach. 


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1 (b) NOTIFICATION OF COVERED ENTITY BY BUSI2 NESS ASSOCIATE.—A business associate of a covered enti3 ty that accesses, maintains, retains, modifies, records, 

4 stores, destroys, or otherwise holds, uses, or discloses un5 secured protected health information shall, following the 

6 discovery of a breach of such information, notify the cov7 ered entity of such breach. Such notice shall include the 

8 identification of each individual whose unsecured protected 

9 health information has been, or is reasonably believed by 

10 the business associate to have been, accessed, acquired, 

11 or disclosed during such breach. 

12 (c) BREACHES TREATED AS DISCOVERED.—For pur13 poses of this section, a breach shall be treated as discov14 ered by a covered entity or by a business associate as of 

15 the first day on which such breach is known to such entity 

16 or associate, respectively (including any person, other than 

17 the individual committing the breach, that is an employee, 

18 officer, or other agent of such entity or associate, respec19 tively), or should reasonably have been known to such enti20 ty or associate (or person) to have occurred. 

21 (d) TIMELINESS OF NOTIFICATION.— 

22 (1) IN GENERAL.—Subject to subsection (g), all 

23 notifications required under this section shall be 

24 made without unreasonable delay and in no case 

25 later than 60 calendar days after the discovery of a 


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1 breach by the covered entity involved (or business 

2 associate involved in the case of a notification re3 quired under subsection (b)). 

4 (2) BURDEN OF PROOF.—The covered entity in5 volved (or business associate involved in the case of 

6 a notification required under subsection (b)), shall 

7 have the burden of demonstrating that all notifica8 tions were made as required under this part, includ9 ing evidence demonstrating the necessity of any 

10 delay. 

11 (e) METHODS OF NOTICE.— 

12 (1) INDIVIDUAL NOTICE.—Notice required 

13 under this section to be provided to an individual, 

14 with respect to a breach, shall be provided promptly 

15 and in the following form: 

16 (A) Written notification by first-class mail 

17 to the individual (or the next of kin of the indi18 vidual if the individual is deceased) at the last 

19 known address of the individual or the next of 

20 kin, respectively, or, if specified as a preference 

21 by the individual, by electronic mail. The notifi22 cation may be provided in one or more mailings 

23 as information is available. 

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1 cluding a phone number, email address, or any 

2 other form of appropriate communication) that 

3 precludes direct written (or, if specified by the 

4 individual under subparagraph (A), electronic) 

5 notification to the individual, a substitute form 

6 of notice shall be provided, including, in the 

7 case that there are 10 or more individuals for 

8 which there is insufficient or out-of-date contact 

9 information, a conspicuous posting for a period 

10 determined by the Secretary on the home page 

11 of the website of the covered entity involved or 

12 notice in major print or broadcast media, in13 cluding major media in geographic areas where 

14 the individuals affected by the breach likely re15 side. Such a notice in media or web posting will 

16 include a toll-free phone number where an indi17 vidual can learn whether or not the individual’s 

18 unsecured protected health information is pos19 sibly included in the breach. 

20 (C) In any case deemed by the covered en21 tity involved to require urgency because of pos22 sible imminent misuse of unsecured protected 

23 health information, the covered entity, in addi24 tion to notice provided under subparagraph (A), 


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1 may provide information to individuals by tele2 phone or other means, as appropriate. 

3 (2) MEDIA NOTICE.—Notice shall be provided 

4 to prominent media outlets serving a State or juris5 diction, following the discovery of a breach described 

6 in subsection (a), if the unsecured protected health 

7 information of more than 500 residents of such 

8 State or jurisdiction is, or is reasonably believed to 

9 have been, accessed, acquired, or disclosed during 

10 such breach. 

11 (3) NOTICE TO SECRETARY.—Notice shall be 

12 provided to the Secretary by covered entities of un13 secured protected health information that has been 

14 acquired or disclosed in a breach. If the breach was 

15 with respect to 500 or more individuals than such 

16 notice must be provided immediately. If the breach 

17 was with respect to less than 500 individuals, the 

18 covered entity involved may maintain a log of any 

19 such breach occurring and annually submit such a 

20 log to the Secretary documenting such breaches oc21 curring during the year involved. 

22 (4) POSTING ON HHS PUBLIC WEBSITE.—The 

23 Secretary shall make available to the public on the 

24 Internet website of the Department of Health and 

25 Human Services a list that identifies each covered 


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1 entity involved in a breach described in subsection 

2 (a) in which the unsecured protected health informa3 tion of more than 500 individuals is acquired or dis4 closed. 

5 (f) CONTENT OF NOTIFICATION.—Regardless of the 

6 method by which notice is provided to individuals under 

7 this section, notice of a breach shall include, to the extent 

8 possible, the following: 

9 (1) A brief description of what happened, in10 cluding the date of the breach and the date of the 

11 discovery of the breach, if known. 

12 (2) A description of the types of unsecured pro13 tected health information that were involved in the 

14 breach (such as full name, Social Security number, 

15 date of birth, home address, account number, or dis16 ability code). 

17 (3) The steps individuals should take to protect 

18 themselves from potential harm resulting from the 

19 breach. 

20 (4) A brief description of what the covered enti21 ty involved is doing to investigate the breach, to 

22 mitigate losses, and to protect against any further 

23 breaches. 

24 (5) Contact procedures for individuals to ask 

25 questions or learn additional information, which 


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1 shall include a toll-free telephone number, an e-mail 

2 address, website, or postal address. 

3 (g) DELAY OF NOTIFICATION AUTHORIZED FOR LAW

4 ENFORCEMENT PURPOSES.—If a law enforcement official 

5 determines that a notification, notice, or posting required 

6 under this section would impede a criminal investigation 

7 or cause damage to national security, such notification, 

8 notice, or posting shall be delayed in the same manner 

9 as provided under section 164.528(a)(2) of title 45, Code 

10 of Federal Regulations, in the case of a disclosure covered 

11 under such section. 

12 (h) UNSECURED PROTECTED HEALTH INFORMA13 TION.— 

14 (1) DEFINITION.— 

15 (A) IN GENERAL.—Subject to subpara16 graph (B), for purposes of this section, the 

17 term ‘‘unsecured protected health information’’ 

18 means protected health information that is not 

19 secured through the use of a technology or 

20 methodology specified by the Secretary in the 

21 guidance issued under paragraph (2). 

22 (B) EXCEPTION IN CASE TIMELY GUID23 ANCE NOT ISSUED.—In the case that the Sec24 retary does not issue guidance under paragraph 

25 (2) by the date specified in such paragraph, for 


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1 purposes of this section, the term ‘‘unsecured 

2 protected health information’’ shall mean pro3 tected health information that is not secured by 

4 a technology standard that renders protected 

5 health information unusable, unreadable, or in6 decipherable to unauthorized individuals and is 

7 developed or endorsed by a standards devel8 oping organization that is accredited by the 

9 American National Standards Institute. 

10 (2) GUIDANCE.—For purposes of paragraph (1) 

11 and section 407(f)(3), not later than the date that 

12 is 60 days after the date of the enactment of this 

13 Act, the Secretary shall, after consultation with 

14 stakeholders, issue (and annually update) guidance 

15 specifying the technologies and methodologies that 

16 render protected health information unusable, 

17 unreadable, or indecipherable to unauthorized indi18 viduals. 

19 (i) REPORT TO CONGRESS ON BREACHES.— 

20 (1) IN GENERAL.—Not later than 12 months 

21 after the date of the enactment of this Act and an22 nually thereafter, the Secretary shall prepare and 

23 submit to the Committee on Finance and the Com24 mittee on Health, Education, Labor, and Pensions 

25 of the Senate and the Committee on Ways and 


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1 Means and the Committee on Energy and Commerce 

2 of the House of Representatives a report containing 

3 the information described in paragraph (2) regard4 ing breaches for which notice was provided to the 

5 Secretary under subsection (e)(3). 

6 (2) INFORMATION.—The information described 

7 in this paragraph regarding breaches specified in 

8 paragraph (1) shall include— 

9 (A) the number and nature of such 

10 breaches; and 

11 (B) actions taken in response to such 

12 breaches. 

13 (j) REGULATIONS; EFFECTIVE DATE.—To carry out 

14 this section, the Secretary of Health and Human Services 

15 shall promulgate interim final regulations by not later 

16 than the date that is 180 days after the date of the enact17 ment of this title. The provisions of this section shall apply 

18 to breaches that are discovered on or after the date that 

19 is 30 days after the date of publication of such interim 

20 final regulations. 

21 SEC. 4403. EDUCATION ON HEALTH INFORMATION PRI22 VACY. 

23 (a) REGIONAL OFFICE PRIVACY ADVISORS.—Not 

24 later than 6 months after the date of the enactment of 

25 this Act, the Secretary shall designate an individual in 


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1 each regional office of the Department of Health and 

2 Human Services to offer guidance and education to cov3 ered entities, business associates, and individuals on their 

4 rights and responsibilities related to Federal privacy and 

5 security requirements for protected health information. 

6 (b) EDUCATION INITIATIVE ON USES OF HEALTH IN7 FORMATION.—Not later than 12 months after the date of 

8 the enactment of this Act, the Office for Civil Rights with9 in the Department of Health and Human Services shall 

10 develop and maintain a multi-faceted national education 

11 initiative to enhance public transparency regarding the 

12 uses of protected health information, including programs 

13 to educate individuals about the potential uses of their 

14 protected health information, the effects of such uses, and 

15 the rights of individuals with respect to such uses. Such 

16 programs shall be conducted in a variety of languages and 

17 present information in a clear and understandable man18 ner. 

19 SEC. 4404. APPLICATION OF PRIVACY PROVISIONS AND 

20 PENALTIES TO BUSINESS ASSOCIATES OF 

21 COVERED ENTITIES. 

22 (a) APPLICATION OF CONTRACT REQUIREMENTS.— 

23 In the case of a business associate of a covered entity that 

24 obtains or creates protected health information pursuant 

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1 scribed in section 164.502(e)(2) of title 45, Code of Fed2 eral Regulations, with such covered entity, the business 

3 associate may use and disclose such protected health infor4 mation only if such use or disclosure, respectively, is in 

5 compliance with each applicable requirement of section 

6 164.504(e) of such title. The additional requirements of 

7 this subtitle that relate to privacy and that are made ap8 plicable with respect to covered entities shall also be appli9 cable to such a business associate and shall be incor10 porated into the business associate agreement between the 

11 business associate and the covered entity. 

12 (b) APPLICATION OF KNOWLEDGE ELEMENTS ASSO13 CIATED WITH CONTRACTS.—Section 164.504(e)(1)(ii) of 

14 title 45, Code of Federal Regulations, shall apply to a 

15 business associate described in subsection (a), with respect 

16 to compliance with such subsection, in the same manner 

17 that such section applies to a covered entity, with respect 

18 to compliance with the standards in sections 164.502(e) 

19 and 164.504(e) of such title, except that in applying such 

20 section 164.504(e)(1)(ii) each reference to the business as21 sociate, with respect to a contract, shall be treated as a 

22 reference to the covered entity involved in such contract. 

23 (c) APPLICATION OF CIVIL AND CRIMINAL PEN24 ALTIES.—In the case of a business associate that violates 

25 any provision of subsection (a) or (b), the provisions of 


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1 sections 1176 and 1177 of the Social Security Act (42 

2 U.S.C. 1320d–5, 1320d–6) shall apply to the business as3 sociate with respect to such violation in the same manner 

4 as such provisions apply to a person who violates a provi5 sion of part C of title XI of such Act. 

6 SEC. 4405. RESTRICTIONS ON CERTAIN DISCLOSURES AND 

7 SALES OF HEALTH INFORMATION; ACCOUNT8 ING OF CERTAIN PROTECTED HEALTH IN9 FORMATION DISCLOSURES; ACCESS TO CER10 TAIN INFORMATION IN ELECTRONIC FOR11 MAT. 

12 (a) REQUESTED RESTRICTIONS ON CERTAIN DIS13 CLOSURES OF HEALTH INFORMATION.—In the case that 

14 an individual requests under paragraph (a)(1)(i)(A) of 

15 section 164.522 of title 45, Code of Federal Regulations, 

16 that a covered entity restrict the disclosure of the pro17 tected health information of the individual, notwith18 standing paragraph (a)(1)(ii) of such section, the covered 

19 entity must comply with the requested restriction if— 

20 (1) except as otherwise required by law, the dis21 closure is to a health plan for purposes of carrying 

22 out payment or health care operations (and is not 

23 for purposes of carrying out treatment); and 

24 (2) the protected health information pertains 

25 solely to a health care item or service for which the 


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1 health care provider involved has been paid out of 

2 pocket in full. 

3 (b) DISCLOSURES REQUIRED TO BE LIMITED TO

4 THE LIMITED DATA SET OR THE MINIMUM NEC5 ESSARY.— 

6 (1) IN GENERAL.— 

7 (A) IN GENERAL.—Subject to subpara8 graph (B), a covered entity shall be treated as 

9 being in compliance with section 164.502(b)(1) 

10 of title 45, Code of Federal Regulations, with 

11 respect to the use, disclosure, or request of pro12 tected health information described in such sec13 tion, only if the covered entity limits such pro14 tected health information, to the extent prac15 ticable, to the limited data set (as defined in 

16 section 164.514(e)(2) of such title) or, if needed 

17 by such entity, to the minimum necessary to ac18 complish the intended purpose of such use, dis19 closure, or request, respectively. 

20 (B) GUIDANCE.—Not later than 18 

21 months after the date of the enactment of this 

22 section, the Secretary shall issue guidance on 

23 what constitutes ‘‘minimum necessary’’ for pur24 poses of subpart E of part 164 of title 45, Code 

25 of Federal Regulation. In issuing such guidance 


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1 the Secretary shall take into consideration the 

2 guidance under section 4424(c). 

3 (C) SUNSET.—Subparagraph (A) shall not 

4 apply on and after the effective date on which 

5 the Secretary issues the guidance under sub6 paragraph (B). 

7 (2) DETERMINATION OF MINIMUM NEC8 ESSARY.—For purposes of paragraph (1), in the 

9 case of the disclosure of protected health informa10 tion, the covered entity or business associate dis11 closing such information shall determine what con12 stitutes the minimum necessary to accomplish the 

13 intended purpose of such disclosure. 

14 (3) APPLICATION OF EXCEPTIONS.—The excep15 tions described in section 164.502(b)(2) of title 45, 

16 Code of Federal Regulations, shall apply to the re17 quirement under paragraph (1) as of the effective 

18 date described in section 4423 in the same manner 

19 that such exceptions apply to section 164.502(b)(1) 

20 of such title before such date. 

21 (4) RULE OF CONSTRUCTION.—Nothing in this 

22 subsection shall be construed as affecting the use, 

23 disclosure, or request of protected health information 

24 that has been de-identified. 


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1 (c) ACCOUNTING OF CERTAIN PROTECTED HEALTH

2 INFORMATION DISCLOSURES REQUIRED IF COVERED EN3 TITY USES ELECTRONIC HEALTH RECORD.— 

4 (1) IN GENERAL.—In applying section 164.528 

5 of title 45, Code of Federal Regulations, in the case 

6 that a covered entity uses or maintains an electronic 

7 health record with respect to protected health infor8 mation— 

9 (A) the exception under paragraph 

10 (a)(1)(i) of such section shall not apply to dis11 closures through an electronic health record 

12 made by such entity of such information; and 

13 (B) an individual shall have a right to re14 ceive an accounting of disclosures described in 

15 such paragraph of such information made by 

16 such covered entity during only the three years 

17 prior to the date on which the accounting is re18 quested. 

19 (2) REGULATIONS.—The Secretary shall pro20 mulgate regulations on what information shall be 

21 collected about each disclosure referred to in para22 graph (1)(A) not later than 18 months after the 

23 date on which the Secretary adopts standards on ac24 counting for disclosure described in the section 

25 3002(b)(2)(B)(iv) of the Public Health Service Act, 


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1 as added by section 4101. Such regulations shall 

2 only require such information to be collected through 

3 an electronic health record in a manner that takes 

4 into account the interests of individuals in learning 

5 the circumstances under which their protected health 

6 information is being disclosed and takes into account 

7 the administrative burden of accounting for such 

8 disclosures. 

9 (3) CONSTRUCTION.—Nothing in this sub10 section shall be construed as requiring a covered en11 tity to account for disclosures of protected health in12 formation that are not made by such covered entity 

13 or by a business associate acting on behalf of the 

14 covered entity. 

15 (4) EFFECTIVE DATE.— 

16 (A) CURRENT USERS OF ELECTRONIC

17 RECORDS.—In the case of a covered entity inso18 far as it acquired an electronic health record as 

19 of January 1, 2009, paragraph (1) shall apply 

20 to disclosures, with respect to protected health 

21 information, made by the covered entity from 

22 such a record on and after January 1, 2014. 

23 (B) OTHERS.—In the case of a covered en24 tity insofar as it acquires an electronic health 

25 record after January 1, 2009, paragraph (1) 


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1 shall apply to disclosures, with respect to pro2 tected health information, made by the covered 

3 entity from such record on and after the later 

4 of the following: 

5 (i) January 1, 2011; or 

6 (ii) the date that it acquires an elec7 tronic health record. 

8 (d) REVIEW OF HEALTH CARE OPERATIONS.—Not 

9 later than 18 months after the date of the enactment of 

10 this title, the Secretary shall promulgate regulations to 

11 eliminate from the definition of health care operations 

12 under section 164.501 of title 45, Code of Federal Regula13 tions, those activities that can reasonably and efficiently 

14 be conducted through the use of information that is de15 identified (in accordance with the requirements of section 

16 164.514(b) of such title) or that should require a valid 

17 authorization for use or disclosure. In promulgating such 

18 regulations, the Secretary may choose to narrow or clarify 

19 activities that the Secretary chooses to retain in the defini20 tion of health care operations and the Secretary shall take 

21 into account the report under section 424(d). In such reg22 ulations the Secretary shall specify the date on which such 

23 regulations shall apply to disclosures made by a covered 

24 entity, but in no case would such date be sooner than the 


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1 date that is 24 months after the date of the enactment 

2 of this section. 

3 (e) PROHIBITION ON SALE OF ELECTRONIC HEALTH

4 RECORDS OR PROTECTED HEALTH INFORMATION.— 

5 (1) IN GENERAL.—Except as provided in para6 graph (2), a covered entity or business associate 

7 shall not directly or indirectly receive remuneration 

8 in exchange for any protected health information of 

9 an individual unless the covered entity obtained from 

10 the individual, in accordance with section 164.508 of 

11 title 45, Code of Federal Regulations, a valid au12 thorization that includes, in accordance with such 

13 section, a specification of whether the protected 

14 health information can be further exchanged for re15 muneration by the entity receiving protected health 

16 information of that individual. 

17 (2) EXCEPTIONS.—Paragraph (1) shall not 

18 apply in the following cases: 

19 (A) The purpose of the exchange is for re20 search or public health activities (as described 

21 in sections 164.501, 164.512(i), and 164.512(b) 

22 of title 45, Code of Federal Regulations) and 

23 the price charged reflects the costs of prepara24 tion and transmittal of the data for such pur25 pose. 


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1 (B) The purpose of the exchange is for the 

2 treatment of the individual and the price 

3 charges reflects not more than the costs of 

4 preparation and transmittal of the data for 

5 such purpose. 

6 (C) The purpose of the exchange is the 

7 health care operation specifically described in 

8 subparagraph (iv) of paragraph (6) of the defi9 nition of health care operations in section 

10 164.501 of title 45, Code of Federal Regula11 tions. 

12 (D) The purpose of the exchange is for re13 muneration that is provided by a covered entity 

14 to a business associate for activities involving 

15 the exchange of protected health information 

16 that the business associate undertakes on behalf 

17 of and at the specific request of the covered en18 tity pursuant to a business associate agreement. 

19 (E) The purpose of the exchange is to pro20 vide an individual with a copy of the individ21 ual’s protected health information pursuant to 

22 section 164.524 of title 45, Code of Federal 

23 Regulations. 

24 (F) The purpose of the exchange is other25 wise determined by the Secretary in regulations 


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1 to be similarly necessary and appropriate as the 

2 exceptions provided in subparagraphs (A) 

3 through (E). 

4 (3) REGULATIONS.—The Secretary shall pro5 mulgate regulations to carry out paragraph (this 

6 subsection, including exceptions described in para7 graph (2), not later than 18 months after the date 

8 of the enactment of this title. 

9 (4) EFFECTIVE DATE.—Paragraph (1) shall 

10 apply to exchanges occurring on or after the date 

11 that is 6 months after the date of the promulgation 

12 of final regulations implementing this subsection. 

13 (f) ACCESS TO CERTAIN INFORMATION IN ELEC14 TRONIC FORMAT.—In applying section 164.524 of title 

15 45, Code of Federal Regulations, in the case that a cov16 ered entity uses or maintains an electronic health record 

17 with respect to protected health information of an indi18 vidual— 

19 (1) the individual shall have a right to obtain 

20 from such covered entity a copy of such information 

21 in an electronic format; and 

22 (2) notwithstanding paragraph (c)(4) of such 

23 section, any fee that the covered entity may impose 

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1 formation) if such copy (or summary or explanation) 

2 is in an electronic form shall not be greater than the 

3 entity’s labor costs in responding to the request for 

4 the copy (or summary or explanation). 

5 SEC. 4406. CONDITIONS ON CERTAIN CONTACTS AS PART 

6 OF HEALTH CARE OPERATIONS. 

7 (a) MARKETING.— 

8 (1) IN GENERAL.—A communication by a cov9 ered entity or business associate that is about a 

10 product or service and that encourages recipients of 

11 the communication to purchase or use the product 

12 or service shall not be considered a health care oper13 ation for purposes of subpart E of part 164 of title 

14 45, Code of Federal Regulations, unless the commu15 nication is made as described in subparagraph (i), 

16 (ii), or (iii) of paragraph (1) of the definition of 

17 marketing in section 164.501 of such title. 

18 (2) PAYMENT FOR CERTAIN COMMUNICA19 TIONS.—A covered entity or business associate may 

20 not receive direct or indirect payment in exchange 

21 for making any communication described in sub22 paragraph (i), (ii), or (iii) of paragraph (1) of the 

23 definition of marketing in section 164.501 of title 

24 45, Code of Federal Regulations, except— 


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1 (A) a business associate of a covered entity 

2 may receive payment from the covered entity 

3 for making any such communication on behalf 

4 of the covered entity that is consistent with the 

5 written contract (or other written arrangement) 

6 described in section 164.502(e)(2) of such title 

7 between such business associate and covered en8 tity; or 

9 (B) a covered entity may receive payment 

10 in exchange for making any such communica11 tion if the entity obtains from the recipient of 

12 the communication, in accordance with section 

13 164.508 of title 45, Code of Federal Regula14 tions, a valid authorization (as described in 

15 paragraph (b) of such section) with respect to 

16 such communication. 

17 (b) FUNDRAISING.—Fundraising for the benefit of a 

18 covered entity shall not be considered a health care oper19 ation for purposes of section 164.501 of title 45, Code of 

20 Federal Regulations. 

21 (c) EFFECTIVE DATE.—This section shall apply to 

22 contracting occurring on or after the effective date speci23 fied under section 4423. 


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1 SEC. 4407. TEMPORARY BREACH NOTIFICATION REQUIRE2 MENT FOR VENDORS OF PERSONAL HEALTH 

3 RECORDS AND OTHER NON-HIPAA COVERED 

4 ENTITIES. 

5 (a) IN GENERAL.—In accordance with subsection (c), 

6 each vendor of personal health records, following the dis7 covery of a breach of security of unsecured PHR identifi8 able health information that is in a personal health record 

9 maintained or offered by such vendor, and each entity de10 scribed in clause (ii) or (iii) of section 4424(b)(1)(A), fol11 lowing the discovery of a breach of security of such infor12 mation that is obtained through a product or service pro13 vided by such entity, shall— 

14 (1) notify each individual who is a citizen or 

15 resident of the United States whose unsecured PHR 

16 identifiable health information was acquired by an 

17 unauthorized person as a result of such a breach of 

18 security; and 

19 (2) notify the Federal Trade Commission. 

20 (b) NOTIFICATION BY THIRD PARTY SERVICE PRO21 VIDERS.—A third party service provider that provides 

22 services to a vendor of personal health records or to an 

23 entity described in clause (ii) or (iii) of section 

24 4424(b)(1)(A) in connection with the offering or mainte25 nance of a personal health record or a related product or 

26 service and that accesses, maintains, retains, modifies, 


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1 records, stores, destroys, or otherwise holds, uses, or dis2 closes unsecured PHR identifiable health information in 

3 such a record as a result of such services shall, following 

4 the discovery of a breach of security of such information, 

5 notify such vendor or entity, respectively, of such breach. 

6 Such notice shall include the identification of each indi7 vidual whose unsecured PHR identifiable health informa8 tion has been, or is reasonably believed to have been, 

9 accessed, acquired, or disclosed during such breach. 

10 (c) APPLICATION OF REQUIREMENTS FOR TIMELI11 NESS, METHOD, AND CONTENT OF NOTIFICATIONS.— 

12 Subsections (c), (d), (e), and (f) of section 402 shall apply 

13 to a notification required under subsection (a) and a ven14 dor of personal health records, an entity described in sub15 section (a) and a third party service provider described 

16 in subsection (b), with respect to a breach of security 

17 under subsection (a) of unsecured PHR identifiable health 

18 information in such records maintained or offered by such 

19 vendor, in a manner specified by the Federal Trade Com20 mission. 

21 (d) NOTIFICATION OF THE SECRETARY.—Upon re22 ceipt of a notification of a breach of security under sub23 section (a)(2), the Federal Trade Commission shall notify 

24 the Secretary of such breach. 


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1 (e) ENFORCEMENT.—A violation of subsection (a) or 

2 (b) shall be treated as an unfair and deceptive act or prac3 tice in violation of a regulation under section 18(a)(1)(B) 

4 of the Federal Trade Commission Act (15 U.S.C. 

5 57a(a)(1)(B)) regarding unfair or deceptive acts or prac6 tices. 

7 (f) DEFINITIONS.—For purposes of this section: 

8 (1) BREACH OF SECURITY.—The term ‘‘breach 

9 of security’’ means, with respect to unsecured PHR 

10 identifiable health information of an individual in a 

11 personal health record, acquisition of such informa12 tion without the authorization of the individual. 

13 (2) PHR IDENTIFIABLE HEALTH INFORMA14 TION.—The term ‘‘PHR identifiable health informa15 tion’’ means individually identifiable health informa16 tion, as defined in section 1171(6) of the Social Se17 curity Act (42 U.S.C. 1320d(6)), and includes, with 

18 respect to an individual, information— 

19 (A) that is provided by or on behalf of the 

20 individual; and 

21 (B) that identifies the individual or with 

22 respect to which there is a reasonable basis to 

23 believe that the information can be used to 

24 identify the individual. 


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1 (3) UNSECURED PHR IDENTIFIABLE HEALTH

2 INFORMATION.— 

3 (A) IN GENERAL.—Subject to subpara4 graph (B), the term ‘‘unsecured PHR identifi5 able health information’’ means PHR identifi6 able health information that is not protected 

7 through the use of a technology or methodology 

8 specified by the Secretary in the guidance 

9 issued under section 4402(h)(2). 

10 (B) EXCEPTION IN CASE TIMELY GUID11 ANCE NOT ISSUED.—In the case that the Sec12 retary does not issue guidance under section 

13 4402(h)(2) by the date specified in such sec14 tion, for purposes of this section, the term ‘‘un15 secured PHR identifiable health information’’ 

16 shall mean PHR identifiable health information 

17 that is not secured by a technology standard 

18 that renders protected health information unus19 able, unreadable, or indecipherable to unauthor20 ized individuals and that is developed or en21 dorsed by a standards developing organization 

22 that is accredited by the American National 

23 Standards Institute. 

24 (g) REGULATIONS; EFFECTIVE DATE; SUNSET.— 


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1 (1) REGULATIONS; EFFECTIVE DATE.—To 

2 carry out this section, the Secretary of Health and 

3 Human Services shall promulgate interim final regu4 lations by not later than the date that is 180 days 

5 after the date of the enactment of this section. The 

6 provisions of this section shall apply to breaches of 

7 security that are discovered on or after the date that 

8 is 30 days after the date of publication of such in9 terim final regulations. 

10 (2) SUNSET.—The provisions of this section 

11 shall not apply to breaches of security occurring on 

12 or after the earlier of the following the dates: 

13 (A) The date on which a standard relating 

14 to requirements for entities that are not covered 

15 entities that includes requirements relating to 

16 breach notification has been promulgated by the 

17 Secretary. 

18 (B) The date on which a standard relating 

19 to requirements for entities that are not covered 

20 entities that includes requirements relating to 

21 breach notification has been promulgated by the 

22 Federal Trade Commission and has taken ef23 fect. 


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1 SEC. 4408. BUSINESS ASSOCIATE CONTRACTS REQUIRED 

2 FOR CERTAIN ENTITIES. 

3 Each organization, with respect to a covered entity, 

4 that provides data transmission of protected health infor5 mation to such entity (or its business associate) and that 

6 requires access on a routine basis to such protected health 

7 information, such as a Health Information Exchange Or8 ganization, Regional Health Information Organization, E9 prescribing Gateway, or each vendor that contracts with 

10 a covered entity to allow that covered entity to offer a per11 sonal health record to patients as part of its electronic 

12 health record, is required to enter into a written contract 

13 (or other written arrangement) described in section 

14 164.502(e)(2) of title 45, Code of Federal Regulations and 

15 a written contract (or other arrangement) described in 

16 section 164.308(b) of such title, with such entity and shall 

17 be treated as a business associate of the covered entity 

18 for purposes of the provisions of this subtitle and subparts 

19 C and E of part 164 of title 45, Code of Federal Regula20 tions, as such provisions are in effect as of the date of 

21 enactment of this title. 

22 SEC. 4409. CLARIFICATION OF APPLICATION OF WRONGFUL 

23 DISCLOSURES CRIMINAL PENALTIES. 

24 Section 1177(a) of the Social Security Act (42 U.S.C. 

25 1320d–6(a)) is amended by adding at the end the fol26 lowing new sentence: ‘‘For purposes of the previous senVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00218 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 tence, a person (including an employee or other individual) 

2 shall be considered to have obtained or disclosed individ3 ually identifiable health information in violation of this 

4 part if the information is maintained by a covered entity 

5 (as defined in the HIPAA privacy regulation described in 

6 section 1180(b)(3)) and the individual obtained or dis7 closed such information without authorization.’’. 

8 SEC. 4410. IMPROVED ENFORCEMENT. 

9 (a) IN GENERAL.—Section 1176 of the Social Secu10 rity Act (42 U.S.C. 1320d–5) is amended— 

11 (1) in subsection (b)(1), by striking ‘‘the act 

12 constitutes an offense punishable under section 

13 1177’’ and inserting ‘‘a penalty has been imposed 

14 under section 1177 with respect to such act’’; and 

15 (2) by adding at the end the following new sub16 section: 

17 ‘‘(c) NONCOMPLIANCE DUE TO WILLFUL NE18 GLECT.— 

19 ‘‘(1) IN GENERAL.—A violation of a provision 

20 of this part due to willful neglect is a violation for 

21 which the Secretary is required to impose a penalty 

22 under subsection (a)(1). 

23 ‘‘(2) REQUIRED INVESTIGATION.—For purposes 

24 of paragraph (1), the Secretary shall formally inves25 tigate any complaint of a violation of a provision of 


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1 this part if a preliminary investigation of the facts 

2 of the complaint indicate such a possible violation 

3 due to willful neglect.’’. 

4 (b) EFFECTIVE DATE; REGULATIONS.— 

5 (1) The amendments made by subsection (a) 

6 shall apply to penalties imposed on or after the date 

7 that is 24 months after the date of the enactment 

8 of this title. 

9 (2) Not later than 18 months after the date of 

10 the enactment of this title, the Secretary of Health 

11 and Human Services shall promulgate regulations to 

12 implement such amendments. 

13 (c) DISTRIBUTION OF CERTAIN CIVIL MONETARY

14 PENALTIES COLLECTED.— 

15 (1) IN GENERAL.—Subject to the regulation 

16 promulgated pursuant to paragraph (3), any civil 

17 monetary penalty or monetary settlement collected 

18 with respect to an offense punishable under this sub19 title or section 1176 of the Social Security Act (42 

20 U.S.C. 1320d–5) insofar as such section relates to 

21 privacy or security shall be transferred to the Office 

22 of Civil Rights of the Department of Health and 

23 Human Services to be used for purposes of enforcing 

24 the provisions of this subtitle and subparts C and E 

25 of part 164 of title 45, Code of Federal Regulations, 


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1 as such provisions are in effect as of the date of en2 actment of this Act. 

3 (2) GAO REPORT.—Not later than 18 months 

4 after the date of the enactment of this title, the 

5 Comptroller General shall submit to the Secretary a 

6 report including recommendations for a methodology 

7 under which an individual who is harmed by an act 

8 that constitutes an offense referred to in paragraph 

9 (1) may receive a percentage of any civil monetary 

10 penalty or monetary settlement collected with re11 spect to such offense. 

12 (3) ESTABLISHMENT OF METHODOLOGY TO

13 DISTRIBUTE PERCENTAGE OF CMPS COLLECTED TO

14 HARMED INDIVIDUALS.—Not later than 3 years 

15 after the date of the enactment of this title, the Sec16 retary shall establish by regulation and based on the 

17 recommendations submitted under paragraph (2), a 

18 methodology under which an individual who is 

19 harmed by an act that constitutes an offense re20 ferred to in paragraph (1) may receive a percentage 

21 of any civil monetary penalty or monetary settlement 

22 collected with respect to such offense. 

23 (4) APPLICATION OF METHODOLOGY.—The 

24 methodology under paragraph (3) shall be applied 

25 with respect to civil monetary penalties or monetary 


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1 settlements imposed on or after the effective date of 

2 the regulation. 

3 (d) TIERED INCREASE IN AMOUNT OF CIVIL MONE4 TARY PENALTIES.— 

5 (1) IN GENERAL.—Section 1176(a)(1) of the 

6 Social Security Act (42 U.S.C. 1320d–5(a)(1)) is 

7 amended by striking ‘‘who violates a provision of 

8 this part a penalty of not more than’’ and all that 

9 follows and inserting the following: ‘‘who violates a 

10 provision of this part— 

11 ‘‘(A) in the case of a violation of such pro12 vision in which it is established that the person 

13 did not know (and by exercising reasonable dili14 gence would not have known) that such person 

15 violated such provision, a penalty for each such 

16 violation of an amount that is at least the 

17 amount described in paragraph (3)(A) but not 

18 to exceed the amount described in paragraph 

19 (3)(D); 

20 ‘‘(B) in the case of a violation of such pro21 vision in which it is established that the viola22 tion was due to reasonable cause and not to 

23 willful neglect, a penalty for each such violation 

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1 scribed in paragraph (3)(B) but not to exceed 

2 the amount described in paragraph (3)(D); and 

3 ‘‘(C) in the case of a violation of such pro4 vision in which it is established that the viola5 tion was due to willful neglect— 

6 ‘‘(i) if the violation is corrected as de7 scribed in subsection (b)(3)(A), a penalty 

8 in an amount that is at least the amount 

9 described in paragraph (3)(C) but not to 

10 exceed the amount described in paragraph 

11 (3)(D); and 

12 ‘‘(ii) if the violation is not corrected 

13 as described in such subsection, a penalty 

14 in an amount that is at least the amount 

15 described in paragraph (3)(D). 

16 In determining the amount of a penalty under 

17 this section for a violation, the Secretary shall 

18 base such determination on the nature and ex19 tent of the violation and the nature and extent 

20 of the harm resulting from such violation.’’. 

21 (2) TIERS OF PENALTIES DESCRIBED.—Section 

22 1176(a) of such Act (42 U.S.C. 1320d–5(a)) is fur23 ther amended by adding at the end the following 

24 new paragraph: 


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1 ‘‘(3) TIERS OF PENALTIES DESCRIBED.—For 

2 purposes of paragraph (1), with respect to a viola3 tion by a person of a provision of this part— 

4 ‘‘(A) the amount described in this subpara5 graph is $100 for each such violation, except 

6 that the total amount imposed on the person 

7 for all such violations of an identical require8 ment or prohibition during a calendar year may 

9 not exceed $25,000; 

10 ‘‘(B) the amount described in this subpara11 graph is $1,000 for each such violation, except 

12 that the total amount imposed on the person 

13 for all such violations of an identical require14 ment or prohibition during a calendar year may 

15 not exceed $100,000; 

16 ‘‘(C) the amount described in this subpara17 graph is $10,000 for each such violation, except 

18 that the total amount imposed on the person 

19 for all such violations of an identical require20 ment or prohibition during a calendar year may 

21 not exceed $250,000; and 

22 ‘‘(D) the amount described in this sub23 paragraph is $50,000 for each such violation, 

24 except that the total amount imposed on the 

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1 quirement or prohibition during a calendar year 

2 may not exceed $1,500,000.’’. 

3 (3) CONFORMING AMENDMENTS.—Section 

4 1176(b) of such Act (42 U.S.C. 1320d–5(b)) is 

5 amended— 

6 (A) by striking paragraph (2) and redesig7 nating paragraphs (3) and (4) as paragraphs 

8 (2) and (3), respectively; and 

9 (B) in paragraph (2), as so redesignated— 

10 (i) in subparagraph (A), by striking 

11 ‘‘in subparagraph (B), a penalty may not 

12 be imposed under subsection (a) if’’ and all 

13 that follows through ‘‘the failure to comply 

14 is corrected’’ and inserting ‘‘in subpara15 graph (B) or subsection (a)(1)(C), a pen16 alty may not be imposed under subsection 

17 (a) if the failure to comply is corrected’’; 

18 and 

19 (ii) in subparagraph (B), by striking 

20 ‘‘(A)(ii)’’ and inserting ‘‘(A)’’ each place it 

21 appears. 

22 (4) EFFECTIVE DATE.—The amendments made 

23 by this subsection shall apply to violations occurring 

24 after the date of the enactment of this title. 


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1 (e) ENFORCEMENT THROUGH STATE ATTORNEYS

2 GENERAL.— 

3 (1) IN GENERAL.—Section 1176 of the Social 

4 Security Act (42 U.S.C. 1320d–5) is amended by 

5 adding at the end the following new subsection: 

6 ‘‘(c) ENFORCEMENT BY STATE ATTORNEYS GEN7 ERAL.— 

8 ‘‘(1) CIVIL ACTION.—Except as provided in 

9 subsection (b), in any case in which the attorney 

10 general of a State has reason to believe that an in11 terest of one or more of the residents of that State 

12 has been or is threatened or adversely affected by 

13 any person who violates a provision of this part, the 

14 attorney general of the State, as parens patriae, may 

15 bring a civil action on behalf of such residents of the 

16 State in a district court of the United States of ap17 propriate jurisdiction— 

18 ‘‘(A) to enjoin further such violation by the 

19 defendant; or 

20 ‘‘(B) to obtain damages on behalf of such 

21 residents of the State, in an amount equal to 

22 the amount determined under paragraph (2). 

23 ‘‘(2) STATUTORY DAMAGES.— 

24 ‘‘(A) IN GENERAL.—For purposes of para25 graph (1)(B), the amount determined under 


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1 this paragraph is the amount calculated by mul2 tiplying the number of violations by up to $100. 

3 For purposes of the preceding sentence, in the 

4 case of a continuing violation, the number of 

5 violations shall be determined consistent with 

6 the HIPAA privacy regulations (as defined in 

7 section 1180(b)(3)) for violations of subsection 

8 (a). 

9 ‘‘(B) LIMITATION.—The total amount of 

10 damages imposed on the person for all viola11 tions of an identical requirement or prohibition 

12 during a calendar year may not exceed $25,000. 

13 ‘‘(C) REDUCTION OF DAMAGES.—In as14 sessing damages under subparagraph (A), the 

15 court may consider the factors the Secretary 

16 may consider in determining the amount of a 

17 civil money penalty under subsection (a) under 

18 the HIPAA privacy regulations. 

19 ‘‘(3) ATTORNEY FEES.—In the case of any suc20 cessful action under paragraph (1), the court, in its 

21 discretion, may award the costs of the action and 

22 reasonable attorney fees to the State. 

23 ‘‘(4) NOTICE TO SECRETARY.—The State shall 

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1 retary with a copy of its complaint, except in any 

2 case in which such prior notice is not feasible, in 

3 which case the State shall serve such notice imme4 diately upon instituting such action. The Secretary 

5 shall have the right— 

6 ‘‘(A) to intervene in the action; 

7 ‘‘(B) upon so intervening, to be heard on 

8 all matters arising therein; and 

9 ‘‘(C) to file petitions for appeal. 

10 ‘‘(5) CONSTRUCTION.—For purposes of bring11 ing any civil action under paragraph (1), nothing in 

12 this section shall be construed to prevent an attor13 ney general of a State from exercising the powers 

14 conferred on the attorney general by the laws of that 

15 State. 

16 ‘‘(6) VENUE; SERVICE OF PROCESS.— 

17 ‘‘(A) VENUE.—Any action brought under 

18 paragraph (1) may be brought in the district 

19 court of the United States that meets applicable 

20 requirements relating to venue under section 

21 1391 of title 28, United States Code. 

22 ‘‘(B) SERVICE OF PROCESS.—In an action 

23 brought under paragraph (1), process may be 

24 served in any district in which the defendant— 

25 ‘‘(i) is an inhabitant; or 


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1 ‘‘(ii) maintains a physical place of 

2 business. 

3 ‘‘(7) LIMITATION ON STATE ACTION WHILE

4 FEDERAL ACTION IS PENDING.—If the Secretary has 

5 instituted an action against a person under sub6 section (a) with respect to a specific violation of this 

7 part, no State attorney general may bring an action 

8 under this subsection against the person with re9 spect to such violation during the pendency of that 

10 action. 

11 ‘‘(8) APPLICATION OF CMP STATUTE OF LIMI12 TATION.—A civil action may not be instituted with 

13 respect to a violation of this part unless an action 

14 to impose a civil money penalty may be instituted 

15 under subsection (a) with respect to such violation 

16 consistent with the second sentence of section 

17 1128A(c)(1).’’. 

18 (2) CONFORMING AMENDMENTS.—Subsection 

19 (b) of such section, as amended by subsection (d)(3), 

20 is amended— 

21 (A) in paragraph (1), by striking ‘‘A pen22 alty may not be imposed under subsection (a)’’ 

23 and inserting ‘‘No penalty may be imposed 

24 under subsection (a) and no damages obtained 

25 under subsection (c)’’; 


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1 (B) in paragraph (2)(A)— 

2 (i) in the matter before clause (i), by 

3 striking ‘‘a penalty may not be imposed 

4 under subsection (a)’’ and inserting ‘‘no 

5 penalty may be imposed under subsection 

6 (a) and no damages obtained under sub7 section (c)’’; and 

8 (ii) in clause (ii), by inserting ‘‘or 

9 damages’’ after ‘‘the penalty’’; 

10 (C) in paragraph (2)(B)(i), by striking 

11 ‘‘The period’’ and inserting ‘‘With respect to 

12 the imposition of a penalty by the Secretary 

13 under subsection (a), the period’’; and 

14 (D) in paragraph (3), by inserting ‘‘and 

15 any damages under subsection (c)’’ after ‘‘any 

16 penalty under subsection (a)’’. 

17 (3) EFFECTIVE DATE.—The amendments made 

18 by this subsection shall apply to violations occurring 

19 after the date of the enactment of this Act. 

20 (f) ALLOWING CONTINUED USE OF CORRECTIVE AC21 TION.—Such section is further amended by adding at the 

22 end the following new subsection: 

23 ‘‘(d) ALLOWING CONTINUED USE OF CORRECTIVE

24 ACTION.—Nothing in this section shall be construed as 

25 preventing the Office of Civil Rights of the Department 


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1 of Health and Human Services from continuing, in its dis2 cretion, to use corrective action without a penalty in cases 

3 where the person did not know (and by exercising reason4 able diligence would not have known) of the violation in5 volved.’’. 

6 SEC. 4411. AUDITS. 

7 The Secretary shall provide for periodic audits to en8 sure that covered entities and business associates that are 

9 subject to the requirements of this subtitle and subparts 

10 C and E of part 164 of title 45, Code of Federal Regula11 tions, as such provisions are in effect as of the date of 

12 enactment of this Act, comply with such requirements. 

13 PART II—RELATIONSHIP TO OTHER LAWS; REGU14 LATORY REFERENCES; EFFECTIVE DATE; RE15 PORTS 

16 SEC. 4421. RELATIONSHIP TO OTHER LAWS. 

17 (a) APPLICATION OF HIPAA STATE PREEMPTION.— 

18 Section 1178 of the Social Security Act (42 U.S.C. 

19 1320d–7) shall apply to a provision or requirement under 

20 this subtitle in the same manner that such section applies 

21 to a provision or requirement under part C of title XI of 

22 such Act or a standard or implementation specification 

23 adopted or established under sections 1172 through 1174 

24 of such Act. 


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1 (b) HEALTH INSURANCE PORTABILITY AND AC2 COUNTABILITY ACT.—The standards governing the pri3 vacy and security of individually identifiable health infor4 mation promulgated by the Secretary under sections 

5 262(a) and 264 of the Health Insurance Portability and 

6 Accountability Act of 1996 shall remain in effect to the 

7 extent that they are consistent with this subtitle. The Sec8 retary shall by rule amend such Federal regulations as re9 quired to make such regulations consistent with this sub10 title. 

11 SEC. 4422. REGULATORY REFERENCES. 

12 Each reference in this subtitle to a provision of the 

13 Code of Federal Regulations refers to such provision as 

14 in effect on the date of the enactment of this title (or to 

15 the most recent update of such provision). 

16 SEC. 4423. EFFECTIVE DATE. 

17 Except as otherwise specifically provided, the provi18 sions of part I shall take effect on the date that is 12 

19 months after the date of the enactment of this title. 

20 SEC. 4424. STUDIES, REPORTS, GUIDANCE. 

21 (a) REPORT ON COMPLIANCE.— 

22 (1) IN GENERAL.—For the first year beginning 

23 after the date of the enactment of this Act and an24 nually thereafter, the Secretary shall prepare and 

25 submit to the Committee on Health, Education, 


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1 Labor, and Pensions of the Senate and the Com2 mittee on Ways and Means and the Committee on 

3 Energy and Commerce of the House of Representa4 tives a report concerning complaints of alleged viola5 tions of law, including the provisions of this subtitle 

6 as well as the provisions of subparts C and E of part 

7 164 of title 45, Code of Federal Regulations (as 

8 such provisions are in effect as of the date of enact9 ment of this Act), relating to privacy and security of 

10 health information that are received by the Secretary 

11 during the year for which the report is being pre12 pared. Each such report shall include, with respect 

13 to such complaints received during the year— 

14 (A) the number of such complaints; 

15 (B) the number of such complaints re16 solved informally, a summary of the types of 

17 such complaints so resolved, and the number of 

18 covered entities that received technical assist19 ance from the Secretary during such year in 

20 order to achieve compliance with such provi21 sions and the types of such technical assistance 

22 provided; 

23 (C) the number of such complaints that 

24 have resulted in the imposition of civil monetary 

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1 tary settlements, including the nature of the 

2 complaints involved and the amount paid in 

3 each penalty or settlement; 

4 (D) the number of compliance reviews con5 ducted and the outcome of each such review; 

6 (E) the number of subpoenas or inquiries 

7 issued; 

8 (F) the Secretary’s plan for improving 

9 compliance with and enforcement of such provi10 sions for the following year; and 

11 (G) the number of audits performed and a 

12 summary of audit findings pursuant to section 

13 4411. 

14 (2) AVAILABILITY TO PUBLIC.—Each report 

15 under paragraph (1) shall be made available to the 

16 public on the Internet website of the Department of 

17 Health and Human Services. 

18 (b) STUDY AND REPORT ON APPLICATION OF PRI19 VACY AND SECURITY REQUIREMENTS TO NON-HIPAA 

20 COVERED ENTITIES.— 

21 (1) STUDY.—Not later than one year after the 

22 date of the enactment of this title, the Secretary, in 

23 consultation with the Federal Trade Commission, 

24 shall conduct a study, and submit a report under 

25 paragraph (2), on privacy and security requirements 


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1 for entities that are not covered entities or business 

2 associates as of the date of the enactment of this 

3 title, including— 

4 (A) requirements relating to security, pri5 vacy, and notification in the case of a breach of 

6 security or privacy (including the applicability 

7 of an exemption to notification in the case of 

8 individually identifiable health information that 

9 has been rendered unusable, unreadable, or in10 decipherable through technologies or methodolo11 gies recognized by appropriate professional or12 ganization or standard setting bodies to provide 

13 effective security for the information) that 

14 should be applied to— 

15 (i) vendors of personal health records; 

16 (ii) entities that offer products or 

17 services through the website of a vendor of 

18 personal health records; 

19 (iii) entities that are not covered enti20 ties and that offer products or services 

21 through the websites of covered entities 

22 that offer individuals personal health 

23 records; 

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1 sonal health record or send information to 

2 a personal health record; and 

3 (v) third party service providers used 

4 by a vendor or entity described in clause 

5 (i), (ii), (iii), or (iv) to assist in providing 

6 personal health record products or services; 

7 (B) a determination of which Federal gov8 ernment agency is best equipped to enforce 

9 such requirements recommended to be applied 

10 to such vendors, entities, and service providers 

11 under subparagraph (A); and 

12 (C) a timeframe for implementing regula13 tions based on such findings. 

14 (2) REPORT.—The Secretary shall submit to 

15 the Committee on Finance, the Committee on 

16 Health, Education, Labor, and Pensions, and the 

17 Committee on Commerce of the Senate and the 

18 Committee on Ways and Means and the Committee 

19 on Energy and Commerce of the House of Rep20 resentatives a report on the findings of the study 

21 under paragraph (1) and shall include in such report 

22 recommendations on the privacy and security re23 quirements described in such paragraph. 

24 (c) GUIDANCE ON IMPLEMENTATION SPECIFICATION

25 TO DE-IDENTIFY PROTECTED HEALTH INFORMATION.— 


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1 Not later than 12 months after the date of the enactment 

2 of this title, the Secretary shall, in consultation with stake3 holders, issue guidance on how best to implement the re4 quirements for the de-identification of protected health in5 formation under section 164.514(b) of title 45, Code of 

6 Federal Regulations. 

7 (d) GAO REPORT ON TREATMENT DISCLOSURES.— 

8 Not later than one year after the date of the enactment 

9 of this title, the Comptroller General of the United States 

10 shall submit to the Committee on Health, Education, 

11 Labor, and Pensions of the Senate and the Committee on 

12 Ways and Means and the Committee on Energy and Com13 merce of the House of Representatives a report on the 

14 best practices related to the disclosure among health care 

15 providers of protected health information of an individual 

16 for purposes of treatment of such individual. Such report 

17 shall include an examination of the best practices imple18 mented by States and by other entities, such as health 

19 information exchanges and regional health information or20 ganizations, an examination of the extent to which such 

21 best practices are successful with respect to the quality 

22 of the resulting health care provided to the individual and 

23 with respect to the ability of the health care provider to 

24 manage such best practices, and an examination of the 

25 use of electronic informed consent for disclosing protected 


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1 health information for treatment, payment, and health 

2 care operations. 

3 TITLE V—MEDICAID 

4 PROVISIONS 

5 SEC. 5000. TABLE OF CONTENTS OF TITLE. 

6 The table of contents of this title is as follows: 

Sec. 5000. Table of contents of title. 

Sec. 5001. Temporary increase of Medicaid FMAP. 

Sec. 5002. Moratoria on certain regulations. 

Sec. 5003. Transitional Medicaid assistance (TMA). 

Sec. 5004. State eligibility option for family planning services. 

Sec. 5005. Protections for Indians under Medicaid and CHIP. 

Sec. 5006. Consultation on Medicaid and CHIP. 

Sec. 5007. Temporary increase in DSH allotments during recession. 

7 SEC. 5001. TEMPORARY INCREASE OF MEDICAID FMAP. 

8 (a) PERMITTING MAINTENANCE OF FMAP.—Subject 

9 to subsections (e), (f), and (g), if the FMAP determined 

10 without regard to this section for a State for— 

11 (1) fiscal year 2009 is less than the FMAP as 

12 so determined for fiscal year 2008, the FMAP for 

13 the State for fiscal year 2008 shall be substituted 

14 for the State’s FMAP for fiscal year 2009, before 

15 the application of this section; 

16 (2) fiscal year 2010 is less than the FMAP as 

17 so determined for fiscal year 2008 or fiscal year 

18 2009 (after the application of paragraph (1)), the 

19 greater of such FMAP for the State for fiscal year 

20 2008 or fiscal year 2009 shall be substituted for the 


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1 State’s FMAP for fiscal year 2010, before the appli2 cation of this section; and 

3 (3) fiscal year 2011 is less than the FMAP as 

4 so determined for fiscal year 2008, fiscal year 2009 

5 (after the application of paragraph (1)), or fiscal 

6 year 2010 (after the application of paragraph (2)), 

7 the greatest of such FMAP for the State for fiscal 

8 year 2008, fiscal year 2009, or fiscal year 2010 shall 

9 be substituted for the State’s FMAP for fiscal year 

10 2011, before the application of this section, but only 

11 for the first calendar quarter in fiscal year 2011. 

12 (b) GENERAL 4.9 PERCENTAGE POINT INCREASE.— 

13 (1) IN GENERAL.—Subject to subsections (e), 

14 (f), and (g) and paragraph (2), for each State for 

15 calendar quarters during the recession adjustment 

16 period (as defined in subsection (h)(2)), the FMAP 

17 (after the application of subsection (a)) shall be in18 creased (without regard to any limitation otherwise 

19 specified in section 1905(b) of the Social Security 

20 Act) by 4.9 percentage points. 

21 (2) SPECIAL ELECTION FOR TERRITORIES.—In 

22 the case of a State that is not one of the 50 States 

23 or the District of Columbia, paragraph (1) shall only 

24 apply if the State makes a one-time election, in a 

25 form and manner specified by the Secretary and for 


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1 the entire recession adjustment period, to apply the 

2 increase in FMAP under paragraph (1) and a 10 

3 percent increase under subsection (d) instead of ap4 plying a 20 percent increase under subsection (d). 

5 (c) ADDITIONAL ADJUSTMENT TO REFLECT IN6 CREASE IN UNEMPLOYMENT.— 

7 (1) IN GENERAL.—Subject to subsections (e), 

8 (f), and (g), in the case of a State that is a high 

9 unemployment State (as defined in paragraph (2)) 

10 for a calendar quarter during the recession adjust11 ment period, the FMAP (taking into account the ap12 plication of subsections (a) and (b)) for such quarter 

13 shall be further increased by the high unemployment 

14 percentage point adjustment specified in paragraph 

15 (3) for the State for the quarter. 

16 (2) HIGH UNEMPLOYMENT STATE.— 

17 (A) IN GENERAL.—In this subsection, sub18 ject to subparagraph (B), the term ‘‘high unem19 ployment State’’ means, with respect to a cal20 endar quarter in the recession adjustment pe21 riod, a State that is 1 of the 50 States or the 

22 District of Columbia and for which the State 

23 unemployment increase percentage (as com24 puted under paragraph (5)) for the quarter is 

25 not less than 1.5 percentage points. 


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1 (B) MAINTENANCE OF STATUS.—If a 

2 State is a high unemployment State for a cal3 endar quarter, it shall remain a high unemploy4 ment State for each subsequent calendar quar5 ter ending before July 1, 2010. 

6 (3) HIGH UNEMPLOYMENT PERCENTAGE POINT

7 ADJUSTMENT.— 

8 (A) IN GENERAL.—The high unemploy9 ment percentage point adjustment specified in 

10 this paragraph for a high unemployment State 

11 for a quarter is equal to the product of— 

12 (i) the SMAP for such State and 

13 quarter (determined after the application 

14 of subsection (a) and before the application 

15 of subsection (b)); and 

16 (ii) subject to subparagraph (B), the 

17 State unemployment reduction factor spec18 ified in paragraph (4) for the State and 

19 quarter. 

20 (B) MAINTENANCE OF ADJUSTMENT

21 LEVEL FOR CERTAIN QUARTERS.—In no case 

22 shall the State unemployment reduction factor 

23 applied under subparagraph (A)(ii) for a State 

24 for a quarter (beginning on or after January 1, 

25 2009, and ending before July 1, 2010) be less 


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1 than the State unemployment reduction factor 

2 applied to the State for the previous quarter 

3 (taking into account the application of this sub4 paragraph). 

5 (4) STATE UNEMPLOYMENT REDUCTION FAC6 TOR.—In the case of a high unemployment State for 

7 which the State unemployment increase percentage 

8 (as computed under paragraph (5)) with respect to 

9 a calendar quarter is— 

10 (A) not less than 1.5, but is less than 2.5, 

11 percentage points, the State unemployment re12 duction factor for the State and quarter is 6 

13 percent; 

14 (B) not less than 2.5, but is less than 3.5, 

15 percentage points, the State unemployment re16 duction factor for the State and quarter is 12 

17 percent; or 

18 (C) not less than 3.5 percentage points, 

19 the State unemployment reduction factor for 

20 the State and quarter is 14 percent. 

21 (5) COMPUTATION OF STATE UNEMPLOYMENT

22 INCREASE PERCENTAGE.— 

23 (A) IN GENERAL.—In this subsection, the 

24 ‘‘State unemployment increase percentage’’ for 

25 a State for a calendar quarter is equal to the 


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1 number of percentage points (if any) by 

2 which— 

3 (i) the average monthly unemployment 

4 rate for the State for months in the most 

5 recent previous 3-consecutive-month period 

6 for which data are available, subject to 

7 subparagraph (C); exceeds 

8 (ii) the lowest average monthly unem9 ployment rate for the State for any 3-con10 secutive-month period preceding the period 

11 described in clause (i) and beginning on or 

12 after January 1, 2006. 

13 (B) AVERAGE MONTHLY UNEMPLOYMENT

14 RATE DEFINED.—In this paragraph, the term 

15 ‘‘average monthly unemployment rate’’ means 

16 the average of the monthly number unemployed, 

17 divided by the average of the monthly civilian 

18 labor force, seasonally adjusted, as determined 

19 based on the most recent monthly publications 

20 of the Bureau of Labor Statistics of the De21 partment of Labor. 

22 (C) SPECIAL RULE.—With respect to— 

23 (i) the first 2 calendar quarters of the 

24 recession adjustment period, the most re25 cent previous 3-consecutive-month period 


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1 described in subparagraph (A)(i) shall be 

2 the 3-consecutive-month period beginning 

3 with October 2008; and 

4 (ii) the last 2 calendar quarters of the 

5 recession adjustment period, the most re6 cent previous 3-consecutive-month period 

7 described in such subparagraph shall be 

8 the 3-consecutive-month period beginning 

9 with December 2009. 

10 (d) INCREASE IN CAP ON MEDICAID PAYMENTS TO

11 TERRITORIES.—Subject to subsections (f) and (g) , with 

12 respect to entire fiscal years occurring during the reces13 sion adjustment period and with respect to fiscal years 

14 only a portion of which occurs during such period (and 

15 in proportion to the portion of the fiscal year that occurs 

16 during such period), the amounts otherwise determined for 

17 Puerto Rico, the Virgin Islands, Guam, the Northern Mar18 iana Islands, and American Samoa under subsections (f) 

19 and (g) of section 1108 of the Social Security Act (42 

20 U.S.C. 1308) shall each be increased by 20 percent (or, 

21 in the case of an election under subsection (b)(2), 10 per22 cent). 

23 (e) SCOPE OF APPLICATION.—The increases in the 

24 FMAP for a State under this section shall apply for pur25 poses of title XIX of the Social Security Act and— 


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1 (1) the increases applied under subsections (a), 

2 (b), and (c) shall not apply with respect— 

3 (A) to payments under parts A, B, and D 

4 of title IV or title XXI of such Act (42 U.S.C. 

5 601 et seq. and 1397aa et seq.); 

6 (B) to payments under title XIX of such 

7 Act that are based on the enhanced FMAP de8 scribed in section 2105(b) of such Act (42 

9 U.S.C. 1397ee(b)); and 

10 (C) to payments for disproportionate share 

11 hospital (DSH) payment adjustments under 

12 section 1923 of such Act (42 U.S.C. 1396r–4); 

13 and 

14 (2) the increase provided under subsection (c) 

15 shall not apply with respect to payments under part 

16 E of title IV of such Act. 

17 (f) STATE INELIGIBILITY AND LIMITATION.— 

18 (1) IN GENERAL.—Subject to paragraphs (2) 

19 and (3), a State is not eligible for an increase in its 

20 FMAP under subsection (a), (b), or (c), or an in21 crease in a cap amount under subsection (d), if eligi22 bility standards, methodologies, or procedures under 

23 its State plan under title XIX of the Social Security 

24 Act (including any waiver under such title or under 

25 section 1115 of such Act (42 U.S.C. 1315)) are 


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1 more restrictive than the eligibility standards, meth2 odologies, or procedures, respectively, under such 

3 plan (or waiver) as in effect on July 1, 2008. 

4 (2) STATE REINSTATEMENT OF ELIGIBILITY

5 PERMITTED.—Subject to paragraph (3), a State that 

6 has restricted eligibility standards, methodologies, or 

7 procedures under its State plan under title XIX of 

8 the Social Security Act (including any waiver under 

9 such title or under section 1115 of such Act (42 

10 U.S.C. 1315)) after July 1, 2008, is no longer ineli11 gible under paragraph (1) beginning with the first 

12 calendar quarter in which the State has reinstated 

13 eligibility standards, methodologies, or procedures 

14 that are no more restrictive than the eligibility 

15 standards, methodologies, or procedures, respec16 tively, under such plan (or waiver) as in effect on 

17 July 1, 2008. 

18 (3) SPECIAL RULES.—A State shall not be in19 eligible under paragraph (1)— 

20 (A) before July 1, 2009, on the basis of a 

21 restriction that was applied after July 1, 2008, 

22 and before the date of the enactment of this 

23 Act; or 

24 (B) on the basis of a restriction that was 

25 effective under State law as of July 1, 2008, 


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1 and would have been in effect as of such date, 

2 but for a delay (of not longer than 1 calendar 

3 quarter) in the approval of a request for a new 

4 waiver under section 1115 of such Act with re5 spect to such restriction. 

6 (4) STATE’S APPLICATION TOWARD RAINY DAY

7 FUND.—A State is not eligible for an increase in its 

8 FMAP under subsection (b) or (c), or an increase in 

9 a cap amount under subsection (d), if any amounts 

10 attributable (directly or indirectly) to such increase 

11 are deposited or credited into any reserve or rainy 

12 day fund of the State. 

13 (5) RULE OF CONSTRUCTION.—Nothing in 

14 paragraph (1) or (2) shall be construed as affecting 

15 a State’s flexibility with respect to benefits offered 

16 under the State Medicaid program under title XIX 

17 of the Social Security Act (42 U.S.C. 1396 et seq.) 

18 (including any waiver under such title or under sec19 tion 1115 of such Act (42 U.S.C. 1315)). 

20 (6) NO WAIVER AUTHORITY.—The Secretary 

21 may not waive the application of this subsection or 

22 subsection (g) under section 1115 of the Social Se23 curity Act or otherwise. 

24 (g) REQUIREMENT FOR CERTAIN STATES.—In the 

25 case of a State that requires political subdivisions within 


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1 the State to contribute toward the non-Federal share of 

2 expenditures under the State Medicaid plan required 

3 under section 1902(a)(2) of the Social Security Act (42 

4 U.S.C. 1396a(a)(2)), the State is not eligible for an in5 crease in its FMAP under subsection (a), (b), or (c), or 

6 an increase in a cap amount under subsection (d), if it 

7 requires that such political subdivisions pay a greater per8 centage of the non-Federal share of such expenditures for 

9 quarters during the recession adjustment period, than the 

10 percentage that would have been required by the State 

11 under such plan on September 30, 2008, prior to applica12 tion of this section. 

13 (h) DEFINITIONS.—In this section, except as other14 wise provided: 

15 (1) FMAP.—The term ‘‘FMAP’’ means the 

16 Federal medical assistance percentage, as defined in 

17 section 1905(b) of the Social Security Act (42 

18 U.S.C. 1396d(b)), as determined without regard to 

19 this section except as otherwise specified. 

20 (2) RECESSION ADJUSTMENT PERIOD.—The 

21 term ‘‘recession adjustment period’’ means the pe22 riod beginning on October 1, 2008, and ending on 

23 December 31, 2010. 

24 (3) SECRETARY.—The term ‘‘Secretary’’ means 

25 the Secretary of Health and Human Services. 


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1 (4) SMAP.—The term ‘‘SMAP’’ means, for a 

2 State, 100 percent minus the Federal medical assist3 ance percentage. 

4 (5) STATE.—The term ‘‘State’’ has the mean5 ing given such term in section 1101(a)(1) of the So6 cial Security Act (42 U.S.C. 1301(a)(1)) for pur7 poses of title XIX of the Social Security Act (42 

8 U.S.C. 1396 et seq.). 

9 (i) SUNSET.—This section shall not apply to items 

10 and services furnished after the end of the recession ad11 justment period. 

12 SEC. 5002. MORATORIA ON CERTAIN REGULATIONS. 

13 (a) EXTENSION OF MORATORIA ON CERTAIN MED14 ICAID REGULATIONS.—The following sections are each 

15 amended by striking ‘‘April 1, 2009’’ and inserting ‘‘July 

16 1, 2009’’: 

17 (1) Section 7002(a)(1) of the U.S. Troop Read18 iness, Veterans’ Care, Katrina Recovery, and Iraq 

19 Accountability Appropriations Act, 2007 (Public 

20 Law 110–28), as amended by section 7001(a)(1) of 

21 the Supplemental Appropriations Act, 2008 (Public 

22 Law 110–252). 

23 (2) Section 206 of the Medicare, Medicaid, and 

24 SCHIP Extension Act of 2007 (Public Law 110– 

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1 plemental Appropriations Act, 2008 (Public Law 

2 110–252). 

3 (3) Section 7001(a)(3)(A) of the Supplemental 

4 Appropriations Act, 2008 (Public Law 110–252). 

5 (b) ADDITIONAL MEDICAID MORATORIUM.—Not6 withstanding any other provision of law, with respect to 

7 expenditures for services furnished during the period be8 ginning on December 8, 2008 and ending on June 30, 

9 2009, the Secretary of Health and Human Services shall 

10 not take any action (through promulgation of regulation, 

11 issuance of regulatory guidance, use of Federal payment 

12 audit procedures, or other administrative action, policy, or 

13 practice, including a Medical Assistance Manual trans14 mittal or letter to State Medicaid directors) to implement 

15 the final regulation relating to clarification of the defini16 tion of outpatient hospital facility services under the Med17 icaid program published on November 7, 2008 (73 Federal 

18 Register 66187). 

19 SEC. 5003. TRANSITIONAL MEDICAID ASSISTANCE (TMA). 

20 (a) 18-MONTH EXTENSION.— 

21 (1) IN GENERAL.—Sections 1902(e)(1)(B) and 

22 1925(f) of the Social Security Act (42 U.S.C. 

23 1396a(e)(1)(B), 1396r–6(f)) are each amended by 

24 striking ‘‘September 30, 2003’’ and inserting ‘‘De25 cember 31, 2010’’. 


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1 (2) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall take effect on July 1, 2009. 

3 (b) STATE OPTION OF INITIAL 12-MONTH ELIGI4 BILITY.—Section 1925 of the Social Security Act (42 

5 U.S.C. 1396r–6) is amended— 

6 (1) in subsection (a)(1), by inserting ‘‘but sub7 ject to paragraph (5)’’ after ‘‘Notwithstanding any 

8 other provision of this title’’; 

9 (2) by adding at the end of subsection (a) the 

10 following: 

11 ‘‘(5) OPTION OF 12-MONTH INITIAL ELIGIBILITY

12 PERIOD.—A State may elect to treat any reference 

13 in this subsection to a 6-month period (or 6 months) 

14 as a reference to a 12-month period (or 12 months). 

15 In the case of such an election, subsection (b) shall 

16 not apply.’’; and 

17 (3) in subsection (b)(1), by inserting ‘‘but sub18 ject to subsection (a)(5)’’ after ‘‘Notwithstanding 

19 any other provision of this title’’. 

20 (c) REMOVAL OF REQUIREMENT FOR PREVIOUS RE21 CEIPT OF MEDICAL ASSISTANCE.—Section 1925(a)(1) of 

22 such Act (42 U.S.C. 1396r–6(a)(1)), as amended by sub23 section (b)(1), is further amended— 

24 (1) by inserting ‘‘subparagraph (B) and’’ before 

25 ‘‘paragraph (5)’’; 


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1 (2) by redesignating the matter after ‘‘RE2 QUIREMENT.—’’ as a subparagraph (A) with the 

3 heading ‘‘IN GENERAL.—’’ and with the same inden4 tation as subparagraph (B) (as added by paragraph 

5 (3)); and 

6 (3) by adding at the end the following: 

7 ‘‘(B) STATE OPTION TO WAIVE REQUIRE8 MENT FOR 3 MONTHS BEFORE RECEIPT OF

9 MEDICAL ASSISTANCE.—A State may, at its op10 tion, elect also to apply subparagraph (A) in 

11 the case of a family that was receiving such aid 

12 for fewer than three months or that had applied 

13 for and was eligible for such aid for fewer than 

14 3 months during the 6 immediately preceding 

15 months described in such subparagraph.’’. 

16 (d) CMS REPORT ON ENROLLMENT AND PARTICIPA17 TION RATES UNDER TMA.—Section 1925 of such Act (42 

18 U.S.C. 1396r–6), as amended by this section, is further 

19 amended by adding at the end the following new sub20 section: 

21 ‘‘(g) COLLECTION AND REPORTING OF PARTICIPA22 TION INFORMATION.— 

23 ‘‘(1) COLLECTION OF INFORMATION FROM

24 STATES.—Each State shall collect and submit to the 

25 Secretary (and make publicly available), in a format 


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1 specified by the Secretary, information on average 

2 monthly enrollment and average monthly participa3 tion rates for adults and children under this section 

4 and of the number and percentage of children who 

5 become ineligible for medical assistance under this 

6 section whose medical assistance is continued under 

7 another eligibility category or who are enrolled under 

8 the State’s child health plan under title XXI. Such 

9 information shall be submitted at the same time and 

10 frequency in which other enrollment information 

11 under this title is submitted to the Secretary. 

12 ‘‘(2) ANNUAL REPORTS TO CONGRESS.—Using 

13 the information submitted under paragraph (1), the 

14 Secretary shall submit to Congress annual reports 

15 concerning enrollment and participation rates de16 scribed in such paragraph.’’. 

17 (e) EFFECTIVE DATE.—The amendments made by 

18 subsections (b) through (d) shall take effect on July 1, 

19 2009. 

20 SEC. 5004. STATE ELIGIBILITY OPTION FOR FAMILY PLAN21 NING SERVICES. 

22 (a) COVERAGE AS OPTIONAL CATEGORICALLY

23 NEEDY GROUP.— 

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 3003(a) 

2 of the Health Insurance Assistance for the Unem3 ployed Act of 2009, is amended— 

4 (A) in subclause (XIX), by striking ‘‘or’’ at 

5 the end; 

6 (B) in subclause (XX), by adding ‘‘or’’ at 

7 the end; and 

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

9 subclause: 

10 ‘‘(XXI) who are described in subsection (ee) 

11 (relating to individuals who meet certain income 

12 standards);’’. 

13 (2) GROUP DESCRIBED.—Section 1902 of such 

14 Act (42 U.S.C. 1396a), as amended by section 

15 3003(a) of the Health Insurance Assistance for the 

16 Unemployed Act of 2009, is amended by adding at 

17 the end the following new subsection: 

18 ‘‘(ee)(1) Individuals described in this subsection are 

19 individuals— 

20 ‘‘(A) whose income does not exceed an in21 come eligibility level established by the State 

22 that does not exceed the highest income eligi23 bility level established under the State plan 

24 under this title (or under its State child health 

25 plan under title XXI) for pregnant women; and 


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1 ‘‘(B) who are not pregnant. 

2 ‘‘(2) At the option of a State, individuals de3 scribed in this subsection may include individuals 

4 who, had individuals applied on or before January 1, 

5 2007, would have been made eligible pursuant to the 

6 standards and processes imposed by that State for 

7 benefits described in clause (XV) of the matter fol8 lowing subparagraph (G) of section subsection 

9 (a)(10) pursuant to a waiver granted under section 

10 1115. 

11 ‘‘(3) At the option of a State, for purposes of 

12 subsection (a)(17)(B), in determining eligibility for 

13 services under this subsection, the State may con14 sider only the income of the applicant or recipient.’’. 

15 (3) LIMITATION ON BENEFITS.—Section 

16 1902(a)(10) of the Social Security Act (42 U.S.C. 

17 1396a(a)(10)) is amended in the matter following 

18 subparagraph (G)— 

19 (A) by striking ‘‘and (XIV)’’ and inserting 

20 ‘‘(XIV)’’; and 

21 (B) by inserting ‘‘, and (XV) the medical 

22 assistance made available to an individual de23 scribed in subsection (ee) shall be limited to 

24 family planning services and supplies described 

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1 agnosis and treatment services that are pro2 vided pursuant to a family planning service in 

3 a family planning setting’’ after ‘‘cervical can4 cer’’. 

5 (4) CONFORMING AMENDMENTS.—Section 

6 1905(a) of the Social Security Act (42 U.S.C. 

7 1396d(a)), as amended by section 3003(c)(2) of the 

8 Health Insurance Assistance for the Unemployed 

9 Act of 2009, is amended in the matter preceding 

10 paragraph (1)— 

11 (A) in clause (xiii), by striking ‘‘or’’ at the 

12 end; 

13 (B) in clause (xiv), by adding ‘‘or’’ at the 

14 end; and 

15 (C) by inserting after clause (xiii) the fol16 lowing: 

17 ‘‘(xv) individuals described in section 

18 1902(ee),’’. 

19 (b) PRESUMPTIVE ELIGIBILITY.— 

20 (1) IN GENERAL.—Title XIX of the Social Se21 curity Act (42 U.S.C. 1396 et seq.) is amended by 

22 inserting after section 1920B the following: 

23 ‘‘PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING

24 SERVICES

25 ‘‘SEC. 1920C. (a) STATE OPTION.—State plan ap26 proved under section 1902 may provide for making medVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00256 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 ical assistance available to an individual described in sec2 tion 1902(ee) (relating to individuals who meet certain in3 come eligibility standard) during a presumptive eligibility 

4 period. In the case of an individual described in section 

5 1902(ee), such medical assistance shall be limited to fam6 ily planning services and supplies described in 

7 1905(a)(4)(C) and, at the State’s option, medical diag8 nosis and treatment services that are provided in conjunc9 tion with a family planning service in a family planning 

10 setting. 

11 ‘‘(b) DEFINITIONS.—For purposes of this section: 

12 ‘‘(1) PRESUMPTIVE ELIGIBILITY PERIOD.—The 

13 term ‘presumptive eligibility period’ means, with re14 spect to an individual described in subsection (a), 

15 the period that— 

16 ‘‘(A) begins with the date on which a 

17 qualified entity determines, on the basis of pre18 liminary information, that the individual is de19 scribed in section 1902(ee); and 

20 ‘‘(B) ends with (and includes) the earlier 

21 of— 

22 ‘‘(i) the day on which a determination 

23 is made with respect to the eligibility of 

24 such individual for services under the State 

25 plan; or 


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1 ‘‘(ii) in the case of such an individual 

2 who does not file an application by the last 

3 day of the month following the month dur4 ing which the entity makes the determina5 tion referred to in subparagraph (A), such 

6 last day. 

7 ‘‘(2) QUALIFIED ENTITY.— 

8 ‘‘(A) IN GENERAL.—Subject to subpara9 graph (B), the term ‘qualified entity’ means 

10 any entity that— 

11 ‘‘(i) is eligible for payments under a 

12 State plan approved under this title; and 

13 ‘‘(ii) is determined by the State agen14 cy to be capable of making determinations 

15 of the type described in paragraph (1)(A). 

16 ‘‘(B) RULE OF CONSTRUCTION.—Nothing 

17 in this paragraph shall be construed as pre18 venting a State from limiting the classes of en19 tities that may become qualified entities in 

20 order to prevent fraud and abuse. 

21 ‘‘(c) ADMINISTRATION.— 

22 ‘‘(1) IN GENERAL.—The State agency shall pro23 vide qualified entities with— 

24 ‘‘(A) such forms as are necessary for an 

25 application to be made by an individual deVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00258 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 scribed in subsection (a) for medical assistance 

2 under the State plan; and 

3 ‘‘(B) information on how to assist such in4 dividuals in completing and filing such forms. 

5 ‘‘(2) NOTIFICATION REQUIREMENTS.—A quali6 fied entity that determines under subsection 

7 (b)(1)(A) that an individual described in subsection 

8 (a) is presumptively eligible for medical assistance 

9 under a State plan shall— 

10 ‘‘(A) notify the State agency of the deter11 mination within 5 working days after the date 

12 on which determination is made; and 

13 ‘‘(B) inform such individual at the time 

14 the determination is made that an application 

15 for medical assistance is required to be made by 

16 not later than the last day of the month fol17 lowing the month during which the determina18 tion is made. 

19 ‘‘(3) APPLICATION FOR MEDICAL ASSIST20 ANCE.—In the case of an individual described in 

21 subsection (a) who is determined by a qualified enti22 ty to be presumptively eligible for medical assistance 

23 under a State plan, the individual shall apply for 

24 medical assistance by not later than the last day of 


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1 the month following the month during which the de2 termination is made. 

3 ‘‘(d) PAYMENT.—Notwithstanding any other provi4 sion of law, medical assistance that— 

5 ‘‘(1) is furnished to an individual described in 

6 subsection (a)— 

7 ‘‘(A) during a presumptive eligibility pe8 riod; and 

9 ‘‘(B) by a entity that is eligible for pay10 ments under the State plan; and 

11 ‘‘(2) is included in the care and services covered 

12 by the State plan, 

13 shall be treated as medical assistance provided by such 

14 plan for purposes of clause (4) of the first sentence of 

15 section 1905(b).’’. 

16 (2) CONFORMING AMENDMENTS.— 

17 (A) Section 1902(a)(47) of the Social Se18 curity Act (42 U.S.C. 1396a(a)(47)) is amend19 ed by inserting before the semicolon at the end 

20 the following: ‘‘and provide for making medical 

21 assistance available to individuals described in 

22 subsection (a) of section 1920C during a pre23 sumptive eligibility period in accordance with 

24 such section’’. 


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1 (B) Section 1903(u)(1)(D)(v) of such Act 

2 (42 U.S.C. 1396b(u)(1)(D)(v)) is amended— 

3 (i) by striking ‘‘or for’’ and inserting 

4 ‘‘for’’; and 

5 (ii) by inserting before the period the 

6 following: ‘‘, or for medical assistance pro7 vided to an individual described in sub8 section (a) of section 1920C during a pre9 sumptive eligibility period under such sec10 tion’’. 

11 (c) CLARIFICATION OF COVERAGE OF FAMILY PLAN12 NING SERVICES AND SUPPLIES.—Section 1937(b) of the 

13 Social Security Act (42 U.S.C. 1396u–7(b)) is amended 

14 by adding at the end the following: 

15 ‘‘(5) COVERAGE OF FAMILY PLANNING SERV16 ICES AND SUPPLIES.—Notwithstanding the previous 

17 provisions of this section, a State may not provide 

18 for medical assistance through enrollment of an indi19 vidual with benchmark coverage or benchmark-equiv20 alent coverage under this section unless such cov21 erage includes for any individual described in section 

22 1905(a)(4)(C), medical assistance for family plan23 ning services and supplies in accordance with such 

24 section.’’. 


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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section take effect on the date of the enactment of 

3 this Act and shall apply to items and services furnished 

4 on or after such date. 

5 SEC. 5005. PROTECTIONS FOR INDIANS UNDER MEDICAID 

6 AND CHIP. 

7 (a) PREMIUMS AND COST SHARING PROTECTION

8 UNDER MEDICAID.— 

9 (1) IN GENERAL.—Section 1916 of the Social 

10 Security Act (42 U.S.C. 1396o) is amended— 

11 (A) in subsection (a), in the matter pre12 ceding paragraph (1), by striking ‘‘and (i)’’ and 

13 inserting ‘‘, (i), and (j)’’; and 

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

15 subsection: 

16 ‘‘(j) NO PREMIUMS OR COST SHARING FOR INDIANS

17 FURNISHED ITEMS OR SERVICES DIRECTLY BY INDIAN

18 HEALTH PROGRAMS OR THROUGH REFERRAL UNDER

19 CONTRACT HEALTH SERVICES.— 

20 ‘‘(1) NO COST SHARING FOR ITEMS OR SERV21 ICES FURNISHED TO INDIANS THROUGH INDIAN

22 HEALTH PROGRAMS.— 

23 ‘‘(A) IN GENERAL.—No enrollment fee, 

24 premium, or similar charge, and no deduction, 

25 copayment, cost sharing, or similar charge shall 


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1 be imposed against an Indian who is furnished 

2 an item or service directly by the Indian Health 

3 Service, an Indian Tribe, Tribal Organization, 

4 or Urban Indian Organization or through refer5 ral under contract health services for which 

6 payment may be made under this title. 

7 ‘‘(B) NO REDUCTION IN AMOUNT OF PAY8 MENT TO INDIAN HEALTH PROVIDERS.—Pay9 ment due under this title to the Indian Health 

10 Service, an Indian Tribe, Tribal Organization, 

11 or Urban Indian Organization, or a health care 

12 provider through referral under contract health 

13 services for the furnishing of an item or service 

14 to an Indian who is eligible for assistance under 

15 such title, may not be reduced by the amount 

16 of any enrollment fee, premium, or similar 

17 charge, or any deduction, copayment, cost shar18 ing, or similar charge that would be due from 

19 the Indian but for the operation of subpara20 graph (A). 

21 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in 

22 this subsection shall be construed as restricting the 

23 application of any other limitations on the imposi24 tion of premiums or cost sharing that may apply to 


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1 an individual receiving medical assistance under this 

2 title who is an Indian.’’. 

3 (2) CONFORMING AMENDMENT.—Section 

4 1916A(b)(3) of such Act (42 U.S.C. 1396o–1(b)(3)) 

5 is amended— 

6 (A) in subparagraph (A), by adding at the 

7 end the following new clause: 

8 ‘‘(vi) An Indian who is furnished an 

9 item or service directly by the Indian 

10 Health Service, an Indian Tribe, Tribal 

11 Organization or Urban Indian Organiza12 tion or through referral under contract 

13 health services.’’; and 

14 (B) in subparagraph (B), by adding at the 

15 end the following new clause: 

16 ‘‘(ix) Items and services furnished to 

17 an Indian directly by the Indian Health 

18 Service, an Indian Tribe, Tribal Organiza19 tion or Urban Indian Organization or 

20 through referral under contract health 

21 services.’’. 

22 (3) EFFECTIVE DATE.—The amendments made 

23 by this subsection shall take effect on October 1, 

24 2009. 


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1 (b) TREATMENT OF CERTAIN PROPERTY FROM RE2 SOURCES FOR MEDICAID AND CHIP ELIGIBILITY.— 

3 (1) MEDICAID.—Section 1902 of the Social Se4 curity Act (42 U.S.C. 1396a), as amended by sec5 tion 3003(a) of the Health Insurance Assistance for 

6 the Unemployed Act of 2009 and section 5004, is 

7 amended by adding at the end the following new 

8 subsection: 

9 ‘‘(ff) Notwithstanding any other requirement of this 

10 title or any other provision of Federal or State law, a State 

11 shall disregard the following property from resources for 

12 purposes of determining the eligibility of an individual who 

13 is an Indian for medical assistance under this title: 

14 ‘‘(1) Property, including real property and im15 provements, that is held in trust, subject to Federal 

16 restrictions, or otherwise under the supervision of 

17 the Secretary of the Interior, located on a reserva18 tion, including any federally recognized Indian 

19 Tribe’s reservation, pueblo, or colony, including 

20 former reservations in Oklahoma, Alaska Native re21 gions established by the Alaska Native Claims Set22 tlement Act, and Indian allotments on or near a res23 ervation as designated and approved by the Bureau 

24 of Indian Affairs of the Department of the Interior. 


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1 ‘‘(2) For any federally recognized Tribe not de2 scribed in paragraph (1), property located within the 

3 most recent boundaries of a prior Federal reserva4 tion. 

5 ‘‘(3) Ownership interests in rents, leases, royal6 ties, or usage rights related to natural resources (in7 cluding extraction of natural resources or harvesting 

8 of timber, other plants and plant products, animals, 

9 fish, and shellfish) resulting from the exercise of fed10 erally protected rights. 

11 ‘‘(4) Ownership interests in or usage rights to 

12 items not covered by paragraphs (1) through (3) 

13 that have unique religious, spiritual, traditional, or 

14 cultural significance or rights that support subsist15 ence or a traditional lifestyle according to applicable 

16 tribal law or custom.’’. 

17 (2) APPLICATION TO CHIP.—Section 2107(e)(1) 

18 of such Act (42 U.S.C. 1397gg(e)(1)) is amended by 

19 adding at the end the following new subparagraph: 

20 ‘‘(E) Section 1902(ff) (relating to dis21 regard of certain property for purposes of mak22 ing eligibility determinations).’’. 

23 (c) CONTINUATION OF CURRENT LAW PROTECTIONS

24 OF CERTAIN INDIAN PROPERTY FROM MEDICAID ESTATE


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1 RECOVERY.—Section 1917(b)(3) of the Social Security 

2 Act (42 U.S.C. 1396p(b)(3)) is amended— 

3 (1) by inserting ‘‘(A)’’ after ‘‘(3)’’; and 

4 (2) by adding at the end the following new sub5 paragraph: 

6 ‘‘(B) The standards specified by the Sec7 retary under subparagraph (A) shall require 

8 that the procedures established by the State 

9 agency under subparagraph (A) exempt income, 

10 resources, and property that are exempt from 

11 the application of this subsection as of April 1, 

12 2003, under manual instructions issued to carry 

13 out this subsection (as in effect on such date) 

14 because of the Federal responsibility for Indian 

15 Tribes and Alaska Native Villages. Nothing in 

16 this subparagraph shall be construed as pre17 venting the Secretary from providing additional 

18 estate recovery exemptions under this title for 

19 Indians.’’. 

20 SEC. 5006. CONSULTATION ON MEDICAID AND CHIP. 

21 (a) IN GENERAL.—Section 1139 of the Social Secu22 rity Act (42 U.S.C. 1320b–9) is amended to read as fol23 lows: 

24 ‘‘CONSULTATION WITH TRIBAL TECHNICAL ADVISORY

25 GROUP (TTAG)

26 ‘‘SEC. 1139. 


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1 ‘‘The Secretary shall maintain within the Centers for 

2 Medicaid & Medicare Services (CMS) a Tribal Technical 

3 Advisory Group, which was first established in accordance 

4 with requirements of the charter dated September 30, 

5 2003, and the Secretary shall include in such Group a rep6 resentative of the Urban Indian Organizations and the 

7 Service. The representative of the Urban Indian Organiza8 tion shall be deemed to be an elected officer of a tribal 

9 government for purposes of applying section 204(b) of the 

10 Unfunded Mandates Reform Act of 1995 (2 U.S.C. 

11 1534(b)).’’. 

12 (b) SOLICITATION OF ADVICE UNDER MEDICAID AND

13 CHIP.— 

14 (1) MEDICAID STATE PLAN AMENDMENT.—Sec15 tion 1902(a) of the Social Security Act (42 U.S.C. 

16 1396a(a)) is amended— 

17 (A) in paragraph (70), by striking ‘‘and’’ 

18 at the end; 

19 (B) in paragraph (71), by striking the pe20 riod at the end and inserting ‘‘; and’’; and 

21 (C) by inserting after paragraph (71), the 

22 following new paragraph: 

23 ‘‘(72) in the case of any State in which 1 or 

24 more Indian Health Programs or Urban Indian Or25 ganizations furnishes health care services, provide 


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1 for a process under which the State seeks advice on 

2 a regular, ongoing basis from designees of such In3 dian Health Programs and Urban Indian Organiza4 tions on matters relating to the application of this 

5 title that are likely to have a direct effect on such 

6 Indian Health Programs and Urban Indian Organi7 zations and that— 

8 ‘‘(A) shall include solicitation of advice 

9 prior to submission of any plan amendments, 

10 waiver requests, and proposals for demonstra11 tion projects likely to have a direct effect on In12 dians, Indian Health Programs, or Urban In13 dian Organizations; and 

14 ‘‘(B) may include appointment of an advi15 sory committee and of a designee of such In16 dian Health Programs and Urban Indian Orga17 nizations to the medical care advisory com18 mittee advising the State on its State plan 

19 under this title.’’. 

20 (2) APPLICATION TO CHIP.—Section 2107(e)(1) 

21 of such Act (42 U.S.C. 1397gg(e)(1)), as amended 

22 by section 5005(b), is amended by adding at the end 

23 the following new subparagraph: 

24 ‘‘(F) Section 1902(a)(72) (relating to re25 quiring certain States to seek advice from desVerDate Nov 24 2008 01:34 Jan 23, 2009 Jkt 079200 PO 00000 Frm 00269 Fmt 6652 Sfmt 6201 E:\BILLS\H629.IH H629

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1 ignees of Indian Health Programs and Urban 

2 Indian Organizations).’’. 

3 (c) RULE OF CONSTRUCTION.—Nothing in the 

4 amendments made by this section shall be construed as 

5 superseding existing advisory committees, working groups, 

6 guidance, or other advisory procedures established by the 

7 Secretary of Health and Human Services or by any State 

8 with respect to the provision of health care to Indians. 

9 SEC. 5007. TEMPORARY INCREASE IN DSH ALLOTMENTS 

10 DURING RECESSION. 

11 Section 1923(f)(3) of the Social Security Act (42 

12 U.S.C. 1396r–4(f)(3)) is amended— 

13 (1) in subparagraph (A), by striking ‘‘para14 graph (6)’’ and inserting ‘‘paragraph (6) and sub15 paragraph (E)’’; and 

16 (2) by adding at the end the following new sub17 paragraph: 

18 ‘‘(E) TEMPORARY INCREASE IN ALLOT19 MENTS DURING RECESSION.— 

20 ‘‘(i) IN GENERAL.—Subject to clause 

21 (ii), the DSH allotment for any State— 

22 ‘‘(I) for fiscal year 2009 is equal 

23 to 102.5 percent of the DSH allot24 ment that would be determined under 

25 this paragraph for the State for fiscal 


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1 year 2009 without application of this 

2 subparagraph, notwithstanding sub3 paragraph (B); 

4 ‘‘(II) for fiscal year 2010 is equal 

5 to 102.5 percent of the the DSH al6 lotment for the State for fiscal year 

7 2009, as determined under subclause 

8 (I); and 

9 ‘‘(III) for each succeeding fiscal 

10 year is equal to the DSH allotment 

11 for the State under this paragraph de12 termined without applying subclauses 

13 (I) and (II). 

14 ‘‘(ii) APPLICATION.—Clause (i) shall 

15 not apply to a State for a year in the case 

16 that the DSH allotment for such State for 

17 such year under this paragraph determined 

18 without applying clause (i) would grow 

19 higher than the DSH allotment specified 

20 under clause (i) for the State for such 

21 year.’’. 

Æ 


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