II 

111TH CONGRESS 

1ST SESSION S. 1114 

To establish a demonstration project to provide for patient-centered medical 

homes to improve the effectiveness and efficiency in providing medical 

assistance under the Medicaid program and child health assistance under 

the State Children’s Health Insurance Program. 

IN THE SENATE OF THE UNITED STATES 

MAY 20, 2009 

Mr. DURBIN (for himself and Mr. BURR) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To establish a demonstration project to provide for patientcentered medical homes to improve the effectiveness and 

efficiency in providing medical assistance under the Medicaid program and child health assistance under the 

State Children’s Health Insurance Program. 

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 ‘‘Medical Homes Act 

5 of 2009’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


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1 (1) Medical homes provide patient-centered 

2 care, leading to better health outcomes and greater 

3 patient satisfaction. A growing body of research sup4 ports the need to involve patients and their families 

5 in their own health care decisions, to better inform 

6 them of their treatment options, and to improve 

7 their access to information. 

8 (2) Medical homes help patients better manage 

9 chronic diseases and maintain basic preventive care, 

10 resulting in better health outcomes than those who 

11 lack medical homes. An investigation of the Chronic 

12 Care Model discovered that the medical home re13 duced the risk of cardiovascular disease in diabetes 

14 patients, helped congestive heart failure patients be15 come more knowledgeable and stay on recommended 

16 therapy, and increased the likelihood that asthma 

17 and diabetes patients would receive appropriate ther18 apy. 

19 (3) Medical homes also reduce disparities in ac20 cess to care. A survey conducted by the Common21 wealth Fund found that 74 percent of adults with a 

22 medical home have reliable access to the care they 

23 need, compared with only 52 percent of adults with 

24 a regular provider that is not a medical home and 


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1 38 percent of adults without any regular source of 

2 care or provider. 

3 (4) Medical homes reduce racial and ethnic dif4 ferences in access to medical care. Three-fourths of 

5 Caucasians, African Americans, and Hispanics with 

6 medical homes report getting care when they need it. 

7 (5) Medical homes reduce duplicative health 

8 services and inappropriate emergency room use. In 

9 1998, North Carolina launched the Community Care 

10 of North Carolina (CCNC) program, which employs 

11 the medical home concept. Presently, CCNC has de12 veloped 14 regional networks that include all of the 

13 Federally qualified health centers in the State and 

14 cover 740,000 recipients. An analysis conducted by 

15 Mercer Human Resources Consulting Group found 

16 that CCNC resulted in $244,000,000 in savings to 

17 the Medicaid program in 2004, with similar results 

18 in 2005 and 2006. 

19 (6) Health information technology is a crucial 

20 foundation for medical homes. While many doctors’ 

21 offices use electronic health records for billing or 

22 other administrative functions, few practices utilize 

23 health information technology systematically to 

24 measure and improve the quality of care they pro25 vide. For example, electronic health records can genVerDate Nov 24 2008 17:42 May 24, 2009 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1114.IS S1114

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1 erate reports to ensure that all patients with chronic 

2 conditions receive recommended tests and are on 

3 target to meet their treatment goals. Computerized 

4 ordering systems, particularly with decision-support 

5 tools, can prevent medical and medication errors, 

6 while e-mail and interactive Internet websites can fa7 cilitate communication between patients and pro8 viders and improve patient education. 

9 SEC. 3. MEDICAID AND CHIP DEMONSTRATION PROJECT 

10 TO SUPPORT PATIENT-CENTERED PRIMARY 

11 CARE. 

12 (a) DEFINITIONS.—In this section: 

13 (1) CARE MANAGEMENT MODEL.—The term 

14 ‘‘care management model’’ means a model that— 

15 (A) uses health information technology and 

16 other innovations such as the chronic care 

17 model, to improve the management and coordi18 nation of care provided to patients; 

19 (B) is centered on the relationship between 

20 a patient and their personal primary care pro21 vider; 

22 (C) seeks guidance from— 

23 (i) a steering committee; and 

24 (ii) a medical management committee; 

25 and 


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1 (D) has established, where practicable, ef2 fective referral relationships between the pri3 mary care provider and the major medical spe4 cialties and ancillary services in the region. 

5 (2) HEALTH CENTER.—The term ‘‘health cen6 ter’’ has the meaning given that term in section 

7 330(a) of the Public Health Service Act (42 U.S.C. 

8 254b(a)). 

9 (3) MEDICAID.—The term ‘‘Medicaid’’ means 

10 the program for medical assistance established under 

11 title XIX of the Social Security Act (42 U.S.C. 1396 

12 et seq.). 

13 (4) MEDICAL MANAGEMENT COMMITTEE.—The 

14 term ‘‘medical management committee’’ means a 

15 group of practitioners that— 

16 (A) provides services in the community in 

17 which the practice or health center is located; 

18 (B) reviews evidence-based practice guide19 lines; 

20 (C) selects targeted disease and care proc21 esses that address health conditions in the com22 munity (as identified in the National or State 

23 health assessment or as outlined in ‘‘Healthy 

24 People 2010’’, or any subsequent similar report 

25 (as determined by the Secretary)); 


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1 (D) defines programs to target disease and 

2 care processes; 

3 (E) establishes standards and measures for 

4 patient-centered medical homes, taking into ac5 count nationally-developed standards and meas6 ures; and 

7 (F) makes the determination described in 

8 subparagraph (A)(iii) of paragraph (5), taking 

9 into account the considerations under subpara10 graph (B) of such paragraph. 

11 (5) PATIENT-CENTERED MEDICAL HOME.— 

12 (A) IN GENERAL.—The term ‘‘patient-cen13 tered medical home’’ means a physician-directed 

14 practice or a health center that— 

15 (i) incorporates the attributes of the 

16 care management model described in para17 graph (1); 

18 (ii) voluntarily participates in an inde19 pendent evaluation process whereby pri20 mary care providers submit information to 

21 the medical management committee of the 

22 relevant network; 

23 (iii) the medical management com24 mittee determines has the capability to 

25 achieve improvements in the management 


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1 and coordination of care for targeted bene2 ficiaries (as defined by statewide quality 

3 improvement standards and outcomes); 

4 and 

5 (iv) meets the requirements imposed 

6 on a covered entity for purposes of apply7 ing part C of title XI of the Social Security 

8 Act (42 U.S.C. 1320d et seq.) and all reg9 ulatory provisions promulgated thereunder, 

10 including regulations (relating to privacy) 

11 adopted pursuant to the authority of the 

12 Secretary under section 264(c) of the 

13 Health Insurance Portability and Account14 ability Act of 1996 (42 U.S.C. 1320d–2 

15 note). 

16 (B) CONSIDERATIONS.—In making the de17 termination under subparagraph (A)(iii), the 

18 medical management committee shall consider 

19 the following: 

20 (i) ACCESS AND COMMUNICATION

21 WITH PATIENTS.—Whether the practice or 

22 health center applies both standards for 

23 access to care for, and standards for com24 munication with, targeted beneficiaries who 


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1 receive care through the practice or health 

2 center. 

3 (ii) MANAGING PATIENT INFORMA4 TION AND USING INFORMATION MANAGE5 MENT TO SUPPORT PATIENT CARE.— 

6 Whether the practice or health center has 

7 readily accessible, clinically useful informa8 tion on such beneficiaries that enables the 

9 practice or health center to provide com10 prehensive and systematic treatment. 

11 (iii) MANAGING AND COORDINATING

12 CARE ACCORDING TO INDIVIDUAL

13 NEEDS.—Whether the practice or health 

14 center— 

15 (I) maintains continuous rela16 tionships with such beneficiaries by 

17 implementing evidence-based guide18 lines and applying such guidelines to 

19 the identified needs of individual bene20 ficiaries over time and with the inten21 sity needed by such beneficiaries; 

22 (II) assists in the early identifica23 tion of health care needs; 

24 (III) provides ongoing primary 

25 care; 


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1 (IV) coordinates with a broad 

2 range of other specialty, ancillary, and 

3 related services; and 

4 (V) provides health care services 

5 and consultations in a culturally and 

6 linguistically appropriate manner, as 

7 well as at a time and location that is 

8 convenient to the patient. 

9 (iv) PROVIDING ONGOING ASSISTANCE

10 AND ENCOURAGEMENT IN PATIENT SELF11 MANAGEMENT.—Whether the practice or 

12 health center— 

13 (I) collaborates with targeted 

14 beneficiaries who receive care through 

15 the practice or health center to pursue 

16 their goals for optimal achievable 

17 health; 

18 (II) assesses patient-specific bar19 riers; and 

20 (III) conducts activities to sup21 port patient self-management. 

22 (v) RESOURCES TO MANAGE CARE.— 

23 Whether the practice or health center has 

24 in place the resources and processes nec25 essary to achieve improvements in the 


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1 management and coordination of care for 

2 targeted beneficiaries who receive care 

3 through the practice or health center. 

4 (vi) MONITORING PERFORMANCE.— 

5 Whether the practice or health center— 

6 (I) monitors its clinical process 

7 and performance (including process 

8 and outcome measures) in meeting 

9 the applicable standards under para10 graph (4)(E); and 

11 (II) provides information in a 

12 form and manner specified by the 

13 steering committee and medical man14 agement committee with respect to 

15 such process and performance. 

16 (6) PERSONAL PRIMARY CARE PROVIDER.—The 

17 term ‘‘personal primary care provider’’ means— 

18 (A) a physician, nurse practitioner, or 

19 other qualified health care provider (as deter20 mined by the Secretary), who— 

21 (i) practices in a patient-centered 

22 medical home; and 

23 (ii) has been trained to provide first 

24 contact, continuous, and comprehensive 

25 care for the whole person, not limited to a 


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1 specific disease condition or organ system, 

2 including care for all types of health condi3 tions (such as acute care, chronic care, and 

4 preventive services); or 

5 (B) a health center that— 

6 (i) is a patient-centered medical home; 

7 and 

8 (ii) has providers on staff that have 

9 received the training described in subpara10 graph (A)(ii). 

11 (7) PRIMARY CARE CASE MANAGEMENT SERV12 ICES; PRIMARY CARE CASE MANAGER.—The terms 

13 ‘‘primary care case management services’’ and ‘‘pri14 mary care case manager’’ have the meaning given 

15 those terms in section 1905(t) of the Social Security 

16 Act (42 U.S.C. 1396d(t)). 

17 (8) PROJECT.—The term ‘‘project’’ means the 

18 demonstration project established under this section. 

19 (9) CHIP.—The term ‘‘CHIP’’ means the 

20 State Children’s Health Insurance Program estab21 lished under title XXI of the Social Security Act (42 

22 U.S.C. 1396aa et seq.). 

23 (10) SECRETARY.—The term ‘‘Secretary’’ 

24 means the Secretary of Health and Human Services. 


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1 (11) STEERING COMMITTEE.—The term ‘‘steer2 ing committee’’ means a local management group 

3 comprised of collaborating local health care practi4 tioners or a local not-for-profit network of health 

5 care practitioners— 

6 (A) that implements State-level initiatives; 

7 (B) that develops local improvement initia8 tives; 

9 (C) whose mission is to— 

10 (i) investigate questions related to 

11 community-based practice; and 

12 (ii) improve the quality of primary 

13 care; and 

14 (D) whose membership— 

15 (i) represents the health care delivery 

16 system of the community it serves; and 

17 (ii) includes physicians (with an em18 phasis on primary care physicians) and at 

19 least 1 representative from each part of 

20 the collaborative or network (such as a 

21 representative from a health center, a rep22 resentative from the health department, a 

23 representative from social services, and a 

24 representative from each public and private 


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1 hospital in the collaborative or the net2 work). 

3 (12) TARGETED BENEFICIARY.— 

4 (A) IN GENERAL.—The term ‘‘targeted 

5 beneficiary’’ means an individual who is eligible 

6 for benefits under a State plan under Medicaid 

7 or a State child health plan under CHIP. 

8 (B) PARTICIPATION IN PATIENT-CEN9 TERED MEDICAL HOME.—Individuals who are 

10 eligible for benefits under Medicaid or CHIP in 

11 a State that has been selected to participate in 

12 the project shall receive care through a patient13 centered medical home when available. 

14 (C) ENSURING CHOICE.—In the case of 

15 such an individual who receives care through a 

16 patient-centered medical home, the individual 

17 shall receive guidance from their personal pri18 mary care provider on appropriate referrals to 

19 other health care professionals in the context of 

20 shared decision-making. 

21 (b) ESTABLISHMENT.—The Secretary shall establish 

22 a demonstration project under Medicaid and CHIP for the 

23 implementation of a patient-centered medical home pro24 gram that meets the requirements of subsection (d) to im25 prove the effectiveness and efficiency in providing medical 


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1 assistance under Medicaid and CHIP to an estimated 

2 500,000 to 1,000,000 targeted beneficiaries. 

3 (c) PROJECT DESIGN.— 

4 (1) DURATION.—The project shall be conducted 

5 for a 3-year period, beginning not later than [Octo6 ber 1, 2011]. 

7 (2) SITES.— 

8 (A) IN GENERAL.—The project shall be 

9 conducted in 8 States— 

10 (i) four of which already provide med11 ical assistance under Medicaid for primary 

12 care case management services as of the 

13 date of enactment of this Act; and 

14 (ii) four of which do not provide such 

15 medical assistance. 

16 (B) APPLICATION.—A State seeking to 

17 participate in the project shall submit an appli18 cation to the Secretary at such time, in such 

19 manner, and containing such information as the 

20 Secretary may require. 

21 (C) SELECTION.—In selecting States to 

22 participate in the project, the Secretary shall 

23 ensure that urban, rural, and underserved areas 

24 are served by the project. 

25 (3) GRANTS AND PAYMENTS.— 


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1 (A) DEVELOPMENT GRANTS.— 

2 (i) FIRST YEAR DEVELOPMENT

3 GRANTS.—The Secretary shall award de4 velopment grants to States participating in 

5 the project during the first year the project 

6 is conducted. Grants awarded under this 

7 clause shall be used by a participating 

8 State to— 

9 (I) assist with the development of 

10 steering committees, medical manage11 ment committees, and local networks 

12 of health care providers; and 

13 (II) facilitate coordination with 

14 local communities to be better pre15 pared and positioned to understand 

16 and meet the needs of the commu17 nities served by patient-centered med18 ical homes. 

19 (ii) SECOND YEAR FUNDING.—The 

20 Secretary shall award additional grant 

21 funds to States that received a develop22 ment grant under clause (i) during the sec23 ond year the project is conducted if the 

24 Secretary determines such funds are nec25 essary to ensure continued participation in 


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1 the project by the State. Grant funds 

2 awarded under this clause shall be used by 

3 a participating State to assist in making 

4 the payments described in paragraph (B). 

5 To the extent a State uses such grant 

6 funds for such purpose, no matching pay7 ment may be made to the State for the 

8 payments made with such funds under sec9 tion 1903(a) or 2105(a) of the Social Se10 curity Act (42 U.S.C. 1396b(a); 

11 1397ee(a)). 

12 (B) ADDITIONAL PAYMENTS TO PERSONAL

13 PRIMARY CARE PROVIDERS AND STEERING COM14 MITTEES.— 

15 (i) PAYMENTS TO PERSONAL PRIMARY

16 CARE PROVIDERS.— 

17 (I) IN GENERAL.—Subject to 

18 subsection (d)(6)(B), a State partici19 pating in the project shall pay a per20 sonal primary care provider not less 

21 than $2.50 per month per targeted 

22 beneficiary assigned to the personal 

23 primary care provider, regardless of 

24 whether the provider saw the targeted 

25 beneficiary that month. 


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1 (II) FEDERAL MATCHING PAY2 MENT.—Subject to subparagraph 

3 (A)(ii), amounts paid to a personal 

4 primary care provider under subclause 

5 (I) shall be considered medical assist6 ance or child health assistance for 

7 purposes of section 1903(a) or 

8 2105(a), respectively, of the Social Se9 curity Act (42 U.S.C. 1396b(a); 

10 1397ee(a)). 

11 (III) PATIENT POPULATION.—In 

12 determining the amount of payment 

13 to a personal primary care provider 

14 per month with respect to targeted 

15 beneficiaries under this clause, a State 

16 participating in the project shall take 

17 into account the care needs of such 

18 targeted beneficiaries. 

19 (ii) PAYMENTS TO STEERING COMMIT20 TEES.— 

21 (I) IN GENERAL.—Subject to 

22 subsection (d)(6)(B), a State partici23 pating in the project shall pay a steer24 ing committee not less than $2.50 per 

25 targeted beneficiary per month. 


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1 (II) FEDERAL MATCHING PAY2 MENT.—Subject to subparagraph 

3 (A)(ii), amounts paid to a steering 

4 committee under subclause (I) shall 

5 be considered medical assistance or 

6 child health assistance for purposes of 

7 section 1903(a) or 2105(a), respec8 tively, of the Social Security Act (42 

9 U.S.C. 1396b(a); 1397ee(a)). 

10 (III) USE OF FUNDS.—Amounts 

11 paid to a steering committee under 

12 subclause (I) shall be used (in accord13 ance with any applicable Medicaid re14 quirements) to purchase health infor15 mation technology, pay primary care 

16 case managers, support network ini17 tiatives, and for such other uses as 

18 the steering committee determines ap19 propriate. 

20 (4) TECHNICAL ASSISTANCE.—The Secretary 

21 shall make available technical assistance to States, 

22 physician practices, and health centers participating 

23 in the project during the duration of the project. 

24 (5) BEST PRACTICES INFORMATION.—The Sec25 retary shall collect and make available to States parVerDate Nov 24 2008 17:42 May 24, 2009 Jkt 079200 PO 00000 Frm 00018 Fmt 6652 Sfmt 6201 E:\BILLS\S1114.IS S1114

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1 ticipating in the project information on best prac2 tices for patient-centered medical homes. 

3 (d) PATIENT-CENTERED MEDICAL HOME PRO4 GRAM.— 

5 (1) IN GENERAL.—For purposes of this section, 

6 a patient-centered medical home program meets the 

7 requirements of this subsection if, under such pro8 gram, targeted beneficiaries have access to a per9 sonal primary care provider in a patient-centered 

10 medical home as their source of first contact, com11 prehensive, and coordinated care for the whole per12 son. 

13 (2) ELEMENTS.— 

14 (A) MANDATORY ELEMENTS.— 

15 (i) IN GENERAL.—Such program shall 

16 include the following elements: 

17 (I) A steering committee. 

18 (II) A medical management com19 mittee. 

20 (III) A network of physician 

21 practices and health centers that have 

22 volunteered to participate as patient23 centered medical homes to provide 

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1 tive care, at the appropriate time and 

2 place and in a cost-effective manner. 

3 (IV) Hospitals and local public 

4 health departments that will work in 

5 cooperation with the network of pa6 tient-centered medical homes to co7 ordinate and provide health care. 

8 (V) Primary care case managers 

9 to assist with care coordination. 

10 (VI) Health information tech11 nology to facilitate the provision and 

12 coordination of health care by network 

13 participants. 

14 (ii) MULTIPLE LOCATIONS IN THE

15 STATE.—In the case where a State oper16 ates a patient-centered medical home pro17 gram in 2 or more areas in the State, the 

18 program in each of those areas shall in19 clude the elements described in clause (i). 

20 (B) OPTIONAL ELEMENTS.—Such program 

21 may include a non-profit organization that— 

22 (i) includes a steering committee and 

23 a medical management committee; and 


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1 (ii) manages the payments to steering 

2 committees described in subsection 

3 (c)(3)(B)(ii). 

4 (3) GOALS.—Such program shall be designed— 

5 (A) to increase— 

6 (i) cost efficiencies of health care de7 livery; 

8 (ii) access to appropriate health care 

9 services, especially wellness and prevention 

10 care, at times convenient for patients; 

11 (iii) patient satisfaction; 

12 (iv) communication among primary 

13 care providers, hospitals, and other health 

14 care providers; 

15 (v) school attendance; and 

16 (vi) the quality of health care services 

17 (as determined by the relevant steering 

18 committee and medical management com19 mittee, taking into account nationally de20 veloped standards and measures); and 

21 (B) to decrease— 

22 (i) inappropriate emergency room uti23 lization, which can be accomplished 

24 through initiatives, such as expanded hours 

25 of care throughout the program network; 


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1 (ii) avoidable hospitalizations; and 

2 (iii) duplication of health care services 

3 provided. 

4 (4) PAYMENT.—Under the program, payment 

5 shall be provided to personal primary care providers 

6 and steering committees (in accordance with sub7 section (c)(3)(B)). 

8 (5) NOTIFICATION.—The State shall notify in9 dividuals enrolled in Medicaid or CHIP about— 

10 (A) the patient-centered medical home pro11 gram; 

12 (B) the providers participating in such 

13 program; and 

14 (C) the benefits of such program. 

15 (6) TREATMENT OF STATES WITH A MANAGED

16 CARE CONTRACT.— 

17 (A) IN GENERAL.—In the case where a 

18 State contracts with a private entity to manage 

19 parts of the State Medicaid program, the State 

20 shall— 

21 (i) ensure that the private entity fol22 lows the care management model; and 

23 (ii) establish a medical management 

24 committee and a steering committee in the 

25 community. 


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1 (B) ADJUSTMENT OF PAYMENT

2 AMOUNTS.—The State may adjust the amount 

3 of payments made under (c)(3)(B), taking into 

4 consideration the management role carried out 

5 by the private entity described in subparagraph 

6 (A) and the cost effectiveness provided by such 

7 entity in certain areas, such as health informa8 tion technology. 

9 (e) EVALUATION AND PROJECT REPORT.— 

10 (1) IN GENERAL.— 

11 (A) EVALUATION.—The Secretary, in con12 sultation with appropriate health care profes13 sional associations, shall evaluate the project in 

14 order to determine the effectiveness of patient15 centered medical homes in terms of quality im16 provement, patient and provider satisfaction, 

17 and the improvement of health outcomes. 

18 (B) PROJECT REPORT.—Not later than 12 

19 months after completion of the project, the Sec20 retary shall submit to Congress a report on the 

21 project containing the results of the evaluation 

22 conducted under subparagraph (A). Such report 

23 shall include— 

24 (i) an assessment of the differences, if 

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1 vided through the patient-centered medical 

2 home program conducted under the project 

3 in the States that provided medical assist4 ance for primary care case management 

5 services and those that did not; 

6 (ii) an assessment of quality improve7 ments and clinical outcomes as a result of 

8 such program; 

9 (iii) estimates of cost savings resulting 

10 from such program; and 

11 (iv) recommendations for such legisla12 tion and administrative action as the Sec13 retary determines to be appropriate. 

14 (2) SENSE OF THE SENATE.—It is the sense of 

15 the Senate that titles XIX and XXI of the Social Se16 curity Act (42 U.S.C. 1396 et seq.; 1397aa et seq.) 

17 should be amended, based on the results of the eval18 uation and report under paragraph (1), to establish 

19 a patient-centered medical home program under 

20 such titles on a permanent basis. 

21 (f) WAIVER.— 

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

23 the Secretary shall waive compliance with such re24 quirements of titles XI, XIX, and XXI of the Social 

25 Security Act (42 U.S.C. 1301 et seq.; 1396 et seq.; 


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1 1397aa et seq.) to the extent and for the period the 

2 Secretary finds necessary to conduct the project. 

3 (2) LIMITATION.—In no case shall the Sec4 retary waive compliance with the requirements of 

5 subsections (a)(10)(A), (a)(15), and (bb) of section 

6 1902 of the Social Security Act (42 U.S.C. 1396a) 

7 under paragraph (1), to the extent that such re8 quirements require the provision of and reimburse9 ment for services described in section 1905(a)(2)(C) 

10 of such Act (42 U.S.C. 1396d(a)(2)(C)). 

Æ 


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