108TH CONGRESS

1ST SESSION H. R. 663

AN ACT

To amend title IX of the Public Health Service Act

to provide for the improvement of patient safetyand to reduce the incidence of events that adversely affect patient safety, and for other purposes.

108TH CONGRESS

1ST SESSION H. R. 663

AN ACT

To amend title IX of the Public Health Service Act to

provide for the improvement of patient safety and to

reduce the incidence of events that adversely affect patient safety, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

3 ‘‘Patient Safety and Quality Improvement Act’’.

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

5 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings and purposes.

TITLE I—PATIENT SAFETY AND QUALITY IMPROVEMENT

Sec. 101. Amendments to Public Health Service Act.

Sec. 102. Promoting the diffusion and interoperability of information technology systems involved with health care delivery.

Sec. 103. Required use of product identification technology.

Sec. 104. Grants for electronic prescription programs.

Sec. 105. Grants to hospitals and other health care providers for information

technologies.

Sec. 106. Authorization of appropriations for grants under sections 104 and

105.

TITLE II—MEDICAL INFORMATION TECHNOLOGY ADVISORY

BOARD.

Sec. 201. Medical Information Technology Advisory Board.

6 SEC. 2. FINDINGS AND PURPOSES.

7 (a) FINDINGS.—The Congress finds as follows:

8 (1) In 1999, the Institute of Medicine released

9 a report entitled ‘‘To Err Is Human’’ that described

10 medical errors as the 8th leading cause of death in

11 the United States, with as many as 98,000 people

12 dying as a result of medical errors each year.

13 (2) To address these deaths and injuries due to

14 medical errors, the health care system must identify

15 and learn from such errors so that systems of care

16 can be improved.
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1 (3) Myriad public and private patient safety ini2 tiatives have begun. The Quality Interagency Coordi3 nation Task Force has recommended steps to im4 prove patient safety that may be taken by each Fed5 eral agency involved in health care and activities re6 lating to these steps are ongoing.

7 (4) The Department of Health and Human

8 Services has initiated several patient safety projects.

9 The Joint Commission on Accreditation of

10 Healthcare Organizations issued a patient safety

11 standard that went into effect on July 1, 2001, and

12 the peer review organizations are conducting ongoing

13 studies of clinical performance measurement of care

14 delivered to beneficiaries under the medicare pro15 gram under title XVIII of the Social Security Act.

16 (5) Several steps can be taken now to improve

17 patient safety. For example, according to the Cen18 ters for Disease Control and Prevention, hand wash19 ing is the single most important means of preventing

20 the spread of infection. Repeated studies indicate

21 that lack of or improper hand washing still contrib22 utes significantly to disease transmission in health

23 care settings. Working with experts from the private

24 sector, the Centers for Disease Control and Preven25 tion has drafted ‘‘Guidelines for Hand Hygiene in
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1 Healthcare Settings’’ setting forth recommendations

2 to promote improved hand hygiene practices and re3 duce transmission of pathogenic microorganisms to

4 patients and personnel in health care settings.

5 (6) According to the Centers for Disease Con6 trol and Prevention, nosocomial infections affect ap7 proximately 2 million patients annually in acute care

8 facilities in the United States at an estimated direct

9 patient care cost of approximately $3.5 billion each

10 year.

11 (7) The Congress encourages the continuation

12 and acceleration of private sector efforts to take im13 mediate steps to improve patient safety and recog14 nizes the need for action in the public sector to com15 plement these efforts.

16 (8) The research on patient safety unequivo17 cally calls for a learning environment, where pro18 viders will feel safe to report health care errors, in

19 order to improve patient safety.

20 (9) Voluntary data gathering systems are more

21 supportive than mandatory systems in creating the

22 learning environment referred to in paragraph (8) as

23 stated in the Institute of Medicine’s report.

24 (10) Promising patient safety reporting systems

25 have been established throughout the United States,
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1 and the best ways to structure and use these sys2 tems are currently being determined, largely through

3 projects funded by the Agency for Healthcare Re4 search and Quality.

5 (11) Many organizations currently collecting

6 patient safety information have expressed a need for

7 protections that will allow them to review protected

8 information so that they may collaborate in the de9 velopment and implementation of patient safety im10 provement strategies. Currently, the State peer re11 view protections provide inadequate conditions to

12 allow the sharing of information to promote patient

13 safety.

14 (12) In 2001, the Institute of Medicine released

15 a report entitled ‘‘Crossing the Quality Chasm’’ that

16 found that the United States health care system

17 does not consistently deliver high-quality care to pa18 tients.

19 (b) PURPOSES.—The purposes of this Act are—

20 (1) to encourage a culture of safety and quality

21 in the United States health care system by providing

22 for a health care errors reporting system that both

23 protects information and improves patient safety

24 and quality of health care; and
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1 (2) to ensure accountability by raising stand2 ards and expectations for continuous quality im3 provements in patient safety through the actions of

4 the Secretary of Health and Human Services.

5 TITLE I—PATIENT SAFETY AND

6 QUALITY IMPROVEMENT

7 SEC. 101. AMENDMENTS TO PUBLIC HEALTH SERVICE ACT.

8 (a) IN GENERAL.—Title IX of the Public Health

9 Service Act (42 U.S.C. 299 et seq.) is amended—

10 (1) in section 912(c), by inserting ‘‘, in accord11 ance with part C,’’ after ‘‘The Director shall’’;

12 (2) by redesignating part C as part D;

13 (3) by redesignating sections 921 through 928,

14 as sections 931 through 938, respectively;

15 (4) in section 938(1) (as so redesignated), by

16 striking ‘‘921’’ and inserting ‘‘931’’; and

17 (5) by inserting after part B the following:

18 ‘‘PART C—PATIENT SAFETY IMPROVEMENT

19 ‘‘SEC. 921. DEFINITIONS.

20 ‘‘In this part:

21 ‘‘(1) IDENTIFIABLE INFORMATION.—The term

22 ‘identifiable information’ means information that is

23 presented in a form and manner that allows the

24 identification of any provider, patient, or reporter of

25 patient safety work product. With respect to pa-
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1 tients, such information includes any individually

2 identifiable health information as that term is de3 fined in the regulations promulgated pursuant to

4 section 264(c) of the Health Insurance Portability

5 and Accountability Act of 1996 (Public Law 104–

6 191; 110 Stat. 2033).

7 ‘‘(2) NONIDENTIFIABLE INFORMATION.—The

8 term ‘nonidentifiable information’ means informa9 tion that is presented in a form and manner that

10 prevents the identification of any provider, patient,

11 or reporter of patient safety work product. With re12 spect to patients, such information must be de-iden13 tified consistent with the regulations promulgated

14 pursuant to section 264(c) of the Health Insurance

15 Portability and Accountability Act of 1996 (Public

16 Law 104–191; 110 Stat. 2033).

17 ‘‘(3) PATIENT SAFETY EVALUATION SYSTEM.—

18 The term ‘patient safety evaluation system’ means a

19 process that involves the collection, management, or

20 analysis of information for submission to or by a pa21 tient safety organization.

22 ‘‘(4) PATIENT SAFETY ORGANIZATION.—The

23 term ‘patient safety organization’ means a private or

24 public organization or component thereof that is cer25 tified, through a process to be determined by the
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1 Secretary under section 925, to perform each of the

2 following activities:

3 ‘‘(A) The conduct, as the organization or

4 component’s primary activity, of efforts to im5 prove patient safety and the quality of health

6 care delivery.

7 ‘‘(B) The collection and analysis of patient

8 safety work product that is submitted by pro9 viders.

10 ‘‘(C) The development and dissemination

11 of evidence-based information to providers with

12 respect to improving patient safety, such as rec13 ommendations, protocols, or information re14 garding best practices.

15 ‘‘(D) The utilization of patient safety work

16 product to carry out activities limited to those

17 described under this paragraph and for the pur18 poses of encouraging a culture of safety and of

19 providing direct feedback and assistance to pro20 viders to effectively minimize patient risk.

21 ‘‘(E) The maintenance of confidentiality

22 with respect to identifiable information.

23 ‘‘(F) The provision of appropriate security

24 measures with respect to patient safety work

25 product.
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1 ‘‘(G) The submission of nonidentifiable in2 formation to the Agency consistent with stand3 ards established by the Secretary under section

4 923(b) for any National Patient Safety Data5 base.

6 ‘‘(5) PATIENT SAFETY WORK PRODUCT.—

7 ‘‘(A) The term ‘patient safety work prod8 uct’ means any document or communication

9 (including any information, report, record,

10 memorandum, analysis, deliberative work, state11 ment, or root cause analysis) that—

12 ‘‘(i) except as provided in subpara13 graph (B), is developed by a provider for

14 the purpose of reporting to a patient safety

15 organization, and is reported to a patient

16 safety organization;

17 ‘‘(ii) is created by a patient safety or18 ganization; or

19 ‘‘(iii) would reveal the deliberations or

20 analytic process of a patient safety evalua21 tion system (as defined in paragraph (3)).

22 ‘‘(B)(i) Patient safety work product de23 scribed in subparagraph (A)(i)—

24 ‘‘(I) does not include any separate in25 formation described in clause (ii); and
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1 ‘‘(II) shall not be construed to include

2 such separate information merely by rea3 son of inclusion of a copy of the document

4 or communication involved in a submission

5 to, or the fact of submission of such a copy

6 to, a patient safety organization.

7 ‘‘(ii) Separate information described in this

8 clause is a document or communication (includ9 ing a patient’s medical record or any other pa10 tient or hospital record) that is developed or

11 maintained, or exists, separately from any pa12 tient safety evaluation system.

13 ‘‘(C) Information available from sources

14 other than a patient safety work product under

15 this section may be discovered or admitted in a

16 civil or administrative proceeding, if discover17 able or admissible under applicable law.

18 ‘‘(6) PROVIDER.—The term ‘provider’ means—

19 ‘‘(A) an individual or entity licensed or

20 otherwise authorized under State law to provide

21 health care services, including—

22 ‘‘(i) a hospital, nursing facility, com23 prehensive outpatient rehabilitation facil24 ity, home health agency, and hospice pro25 gram;
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1 ‘‘(ii) a physician, physician assistant,

2 nurse practitioner, clinical nurse specialist,

3 certified nurse midwife, nurse anesthetist,

4 psychologist, certified social worker, reg5 istered dietitian or nutrition professional,

6 physical or occupational therapist, or other

7 individual health care practitioner;

8 ‘‘(iii) a pharmacist; and

9 ‘‘(iv) a renal dialysis facility, ambula10 tory surgical center, pharmacy, physician

11 or health care practitioner’s office, long12 term care facility, behavioral health resi13 dential treatment facility, clinical labora14 tory, or community health center; or

15 ‘‘(B) any other person or entity specified

16 in regulations by the Secretary after public no17 tice and comment.

18 ‘‘SEC. 922. PRIVILEGE FOR PATIENT SAFETY WORK PROD19 UCT.

20 ‘‘(a) PRIVILEGE.—Notwithstanding any other provi21 sion of law and subject to subsection (c), patient safety

22 work product shall not be—

23 ‘‘(1) subject to a civil or administrative sub24 poena or order;
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1 ‘‘(2) subject to discovery in connection with a

2 civil or administrative proceeding;

3 ‘‘(3) subject to disclosure pursuant to section

4 552 of title 5, United States Code (commonly known

5 as the Freedom of Information Act), or any other

6 similar Federal or State law;

7 ‘‘(4) required to be admitted as evidence or oth8 erwise disclosed in any State or Federal civil or ad9 ministrative proceeding; or

10 ‘‘(5) if the patient safety work product is identi11 fiable information and is received by a national ac12 creditation organization in its capacity as a patient

13 safety organization—

14 ‘‘(A) used by a national accreditation orga15 nization in an accreditation action against the

16 provider that reported the information;

17 ‘‘(B) shared by such organization with its

18 survey team; or

19 ‘‘(C) required as a condition of accredita20 tion by a national accreditation association.

21 ‘‘(b) REPORTER PROTECTION.—

22 ‘‘(1) IN GENERAL.—A provider may not use

23 against an individual in an adverse employment ac24 tion described in paragraph (2) the fact that the in25 dividual in good faith reported information—
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1 ‘‘(A) to the provider with the intention of

2 having the information reported to a patient

3 safety organization; or

4 ‘‘(B) directly to a patient safety organiza5 tion.

6 ‘‘(2) ADVERSE EMPLOYMENT ACTION.—For

7 purposes of this subsection, an ‘adverse employment

8 action’ includes—

9 ‘‘(A) the failure to promote an individual

10 or provide any other employment-related benefit

11 for which the individual would otherwise be eli12 gible;

13 ‘‘(B) an adverse evaluation or decision

14 made in relation to accreditation, certification,

15 credentialing, or licensing of the individual; and

16 ‘‘(C) a personnel action that is adverse to

17 the individual concerned.

18 ‘‘(3) REMEDIES.—Any provider that violates

19 this subsection shall be subject to a civil monetary

20 penalty of not more than $20,000 for each such vio21 lation involved. Such penalty shall be imposed and

22 collected in the same manner as civil money pen23 alties under subsection (a) of section 1128A of the

24 Social Security Act are imposed and collected.
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1 ‘‘(c) DISCLOSURES.—Nothing in this section pro2 hibits any of the following disclosures:

3 ‘‘(1) Voluntary disclosure of nonidentifiable in4 formation.

5 ‘‘(2) Voluntary disclosure of identifiable infor6 mation by a provider or patient safety organization,

7 if such disclosure—

8 ‘‘(A) is authorized by the provider for the

9 purposes of improving quality and safety;

10 ‘‘(B) is to an entity or person subject to

11 the requirements of section 264(c) of the

12 Health Insurance Portability and Accountability

13 Act of 1996 (Public Law 104–191; 110 Stat.

14 2033), or any regulation promulgated under

15 such section; and

16 ‘‘(C) is not in conflict with such section or

17 any regulation promulgated under such section.

18 ‘‘(3) Disclosure as required by law by a pro19 vider to the Food and Drug Administration, or on

20 a voluntary basis by a provider to a federally estab21 lished patient safety program, with respect to an Ad22 ministration-regulated product or activity for which

23 that entity has responsibility, for the purposes of ac24 tivities related to the quality, safety, or effectiveness

25 of such Administration-regulated product or activity.
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1 ‘‘(4) Disclosures of patient safety work product

2 in accordance with this part by a provider to a pa3 tient safety organization.

4 ‘‘(d) EFFECT OF TRANSFER, DISCLOSURE.—The fol5 lowing shall not be treated as a waiver of any privilege

6 or protection established under this part:

7 ‘‘(1) The transfer of any patient safety work

8 product between a provider and a patient safety or9 ganization.

10 ‘‘(2) Disclosure of patient safety work product

11 as described in subsection (c).

12 ‘‘(3) The unauthorized disclosure of patient

13 safety work product.

14 ‘‘(e) PENALTY.—

15 ‘‘(1) PROHIBITION.—Except as provided in this

16 part, and subject to paragraphs (2) and (4), it shall

17 be unlawful for any person to disclose patient safety

18 work product in violation of this section, if such dis19 closure constitutes a negligent or knowing breach of

20 confidentiality.

21 ‘‘(2) RELATION TO HIPAA.—The penalty under

22 paragraph (3) for a disclosure in violation of para23 graph (1) does not apply if the person would be sub24 ject to a penalty under section 264(c) of the Health

25 Insurance Portability and Accountability Act of
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1 1996 (Public Law 104–191; 110 Stat. 2033), or any

2 regulation promulgated under such section, for the

3 same disclosure.

4 ‘‘(3) AMOUNT.—Any person who violates para5 graph (1) shall be subject to a civil monetary penalty

6 of not more than $10,000 for each such violation in7 volved. Such penalty shall be imposed and collected

8 in the same manner as civil money penalties under

9 subsection (a) of section 1128A of the Social Secu10 rity Act are imposed and collected.

11 ‘‘(4) SUBSEQUENT DISCLOSURE.—Paragraph

12 (1) applies only to the first person that breaches

13 confidentiality with respect to particular patient

14 safety work product.

15 ‘‘(f) RELATION TO HIPAA.—

16 ‘‘(1) IN GENERAL.—For purposes of applying

17 the regulations promulgated pursuant to section

18 264(c) of the Health Insurance Portability and Ac19 countability Act of 1996 (Public Law 104–191; 110

20 Stat. 2033)—

21 ‘‘(A) patient safety organizations shall be

22 treated as business associates; and

23 ‘‘(B) activities of such organizations de24 scribed in section 921(4) in relation to a pro-
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1 vider are deemed to be health care operations

2 (as defined in such regulations) of the provider.

3 ‘‘(2) RULE OF CONSTRUCTION.—Nothing in

4 this section shall be construed to alter or affect the

5 implementation of such regulations or such section

6 264(c).

7 ‘‘(g) NO LIMITATION OF OTHER PRIVILEGES.—

8 Nothing in this section shall be construed to affect privi9 leges, including peer review and confidentiality protec10 tions, that are otherwise available under Federal or State

11 laws.

12 ‘‘(h) NO LIMITATION ON CONTRACTS.—Nothing in

13 this section shall be construed to limit the power of a pro14 vider and a patient safety organization, or a patient safety

15 organization and the Agency or any National Patient

16 Safety Database, consistent with the provisions of this Act

17 and other applicable law, to enter into a contract requiring

18 greater confidentiality or delegating authority to make an

19 authorized disclosure.

20 ‘‘(i) RELATION TO STATE REPORTING REQUIRE21 MENTS.—Nothing in this part shall be construed as pre22 empting or otherwise affecting any State law requiring a

23 provider to report information, including information de24 scribed in section 921(5)(B), that is not patient safety

25 work product.
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1 ‘‘(j) CONTINUATION OF PRIVILEGE.—Patient safety

2 work product of an organization that is certified as a pa3 tient safety organization shall continue to be privileged

4 and confidential, in accordance with this section, if the or5 ganization’s certification is terminated or revoked or if the

6 organization otherwise ceases to qualify as a patient safety

7 organization.

8 ‘‘(k) REPORTS ON STRATEGIES TO IMPROVE PA9 TIENT SAFETY.—

10 ‘‘(1) DRAFT REPORT.—Not later than the date

11 that is 18 months after any National Patient Safety

12 Database is operational, the Secretary, in consulta13 tion with the Director, shall prepare a draft report

14 on effective strategies for reducing medical errors

15 and increasing patient safety. The draft report shall

16 include any measure determined appropriate by the

17 Secretary to encourage the appropriate use of such

18 strategies, including use in any federally funded pro19 grams. The Secretary shall make the draft report

20 available for public comment and submit the draft

21 report to the Institute of Medicine for review.

22 ‘‘(2) FINAL REPORT.—Not later than 1 year

23 after the date described in paragraph (1), the Sec24 retary shall submit a final report to the Congress

25 that includes, in an appendix, any findings by the
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1 Institute of Medicine concerning research on the

2 strategies discussed in the draft report and any

3 modifications made by the Secretary based on such

4 findings.

5 ‘‘SEC. 923. NATIONAL PATIENT SAFETY DATABASE.

6 ‘‘(a) AUTHORITY.—

7 ‘‘(1) IN GENERAL.—In conducting activities

8 under this part, the Secretary shall provide for the

9 establishment and maintenance of a database to re10 ceive relevant nonidentifiable patient safety work

11 product, and may designate entities to collect rel12 evant nonidentifiable patient safety work product

13 that is voluntarily reported by patient safety organi14 zations upon the request of the Secretary. Any data15 base established or designated under this paragraph

16 may be referred to as a ‘National Patient Safety

17 Database’.

18 ‘‘(2) USE OF INFORMATION.—Information re19 ported to any National Patient Safety Database

20 shall be used to analyze national and regional statis21 tics, including trends and patterns of health care er22 rors. The information resulting from such analyses

23 may be included in the annual quality reports pre24 pared under section 913(b)(2).
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1 ‘‘(3) ADVISORY ROLE.—The Secretary shall

2 provide scientific support to patient safety organiza3 tions, including the dissemination of methodologies

4 and evidence-based information related to root

5 causes and quality improvement.

6 ‘‘(b) STANDARDS.—In establishing or designating a

7 database under subsection (a)(1), the Secretary shall, in

8 consultation with representatives of patient safety organi9 zations, the provider community, and the health informa10 tion technology industry, determine common formats for

11 the voluntary reporting of nonidentifiable patient safety

12 work product, including necessary elements, common and

13 consistent definitions, and a standardized computer inter14 face for the processing of the work product. To the extent

15 practicable, such standards shall be consistent with the

16 administrative simplification provisions of part C of title

17 XI of the Social Security Act.

18 ‘‘(c) CERTAIN METHODOLOGIES FOR COLLECTION.—

19 The Secretary shall ensure that the methodologies for the

20 collection of nonidentifiable patient safety work product

21 for any National Patient Safety Database include the

22 methodologies developed or recommended by the Patient

23 Safety Task Force of the Department of Health and

24 Human Services.
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1 ‘‘(d) FACILITATION OF INFORMATION EXCHANGE.—

2 To the extent practicable, the Secretary may facilitate the

3 direct link of information between providers and patient

4 safety organizations and between patient safety organiza5 tions and any National Patient Safety Database.

6 ‘‘(e) RESTRICTION ON TRANSFER.—Only nonidentifi7 able information may be transferred to any National Pa8 tient Safety Database.

9 ‘‘SEC. 924. TECHNICAL ASSISTANCE.

10 ‘‘(a) IN GENERAL.—The Secretary, acting through

11 the Director, may—

12 ‘‘(1) provide technical assistance to patient

13 safety organizations, and to States with reporting

14 systems for health care errors; and

15 ‘‘(2) provide guidance on the type of data to be

16 voluntarily submitted to any National Patient Safety

17 Database.

18 ‘‘(b) ANNUAL MEETINGS.—Assistance provided

19 under subsection (a) may include annual meetings for pa20 tient safety organizations to discuss methodology, commu21 nication, information collection, or privacy concerns.

22 ‘‘SEC. 925. CERTIFICATION OF PATIENT SAFETY ORGANIZA23 TIONS.

24 ‘‘(a) IN GENERAL.—Not later than 6 months after

25 the date of enactment of the Patient Safety and Quality
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1 Improvement Act, the Secretary shall establish a process

2 for certifying patient safety organizations.

3 ‘‘(b) PROCESS.—The process established under sub4 section (a) shall include the following:

5 ‘‘(1) Certification of patient safety organiza6 tions by the Secretary or by such other national or

7 State governmental organizations as the Secretary

8 determines appropriate.

9 ‘‘(2) If the Secretary allows other governmental

10 organizations to certify patient safety organizations

11 under paragraph (1), the Secretary shall establish a

12 process for approving such organizations. Any such

13 approved organization shall conduct certifications

14 and reviews in accordance with this section.

15 ‘‘(3) A review of each certification under para16 graph (1) (including a review of compliance with

17 each criterion in this section and any related imple18 menting standards as determined by the Secretary

19 through rulemaking) not less often than every 3

20 years, as determined by the Secretary.

21 ‘‘(4) Revocation of any such certification by the

22 Secretary or other such governmental organization

23 that issued the certification, upon a showing of

24 cause.
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1 ‘‘(c) CRITERIA.—A patient safety organization must

2 meet the following criteria as conditions of certification:

3 ‘‘(1) The mission of the patient safety organiza4 tion is to conduct activities that are to improve pa5 tient safety and the quality of health care delivery

6 and is not in conflict of interest with the providers

7 that contract with the patient safety organization.

8 ‘‘(2) The patient safety organization has appro9 priately qualified staff, including licensed or certified

10 medical professionals.

11 ‘‘(3) The patient safety organization, within any

12 2 year period, contracts with more than 1 provider

13 for the purpose of receiving and reviewing patient

14 safety work product.

15 ‘‘(4) The patient safety organization is not a

16 component of a health insurer or other entity that

17 offers a group health plan or health insurance cov18 erage.

19 ‘‘(5) The patient safety organization is man20 aged, controlled, and operated independently from

21 any provider that contracts with the patient safety

22 organization for reporting patient safety work prod23 uct.

24 ‘‘(6) To the extent practical and appropriate,

25 the patient safety organization collects patient safety
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1 work product from providers in a standardized man2 ner that permits valid comparisons of similar cases

3 among similar providers.

4 ‘‘(d) ADDITIONAL CRITERIA FOR COMPONENT ORGA5 NIZATIONS.—If a patient safety organization is a compo6 nent of another organization, the patient safety organiza7 tion must, in addition to meeting the criteria described

8 in subsection (c), meet the following criteria as conditions

9 of certification:

10 ‘‘(1) The patient safety organization maintains

11 patient safety work product separately from the rest

12 of the organization, and establishes appropriate se13 curity measures to maintain the confidentiality of

14 the patient safety work product.

15 ‘‘(2) The patient safety organization does not

16 make an unauthorized disclosure under this Act of

17 patient safety work product to the rest of the orga18 nization in breach of confidentiality.

19 ‘‘(3) The mission of the patient safety organiza20 tion does not create a conflict of interest with the

21 rest of the organization.’’.

22 (b) AUTHORIZATION OF APPROPRIATIONS.—Section

23 937 of the Public Health Service Act (as redesignated by

24 subsection (a)) is amended by adding at the end the fol25 lowing:
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1 ‘‘(e) PATIENT SAFETY AND QUALITY IMPROVE2 MENT.—For the purpose of carrying out part C, there are

3 authorized to be appropriated such sums as may be nec4 essary for each of the fiscal years 2004 through 2008.’’.

5 SEC. 102. PROMOTING THE DIFFUSION AND INTEROPER6 ABILITY OF INFORMATION TECHNOLOGY SYS7 TEMS INVOLVED WITH HEALTH CARE DELIV8 ERY.

9 (a) VOLUNTARY STANDARDS.—

10 (1) IN GENERAL.—Not later than 18 months

11 after the date of the enactment of this Act, the Sec12 retary of Health and Human Services (in this sec13 tion referred to as the ‘‘Secretary’’) shall—

14 (A) develop or adopt voluntary national

15 standards that promote the interoperability of

16 information technology systems involved with

17 health care delivery, including but not limited to

18 computerized physician order entry;

19 (B) in developing or adopting such stand20 ards, take into account—

21 (i) the ability of such systems to cap22 ture and aggregate clinically specific data

23 to enable evidence-based medicine and

24 other applications that promote the elec-
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1 tronic exchange of patient medical record

2 information; and

3 (ii) the cost that meeting such stand4 ards would have on providing health care

5 in the United States and the increased effi6 ciencies in providing such care achieved

7 under the standards;

8 (C) in developing or adopting such stand9 ards and to the extent practicable, test the effi10 cacy, usability, and scalability of proposed inter11 operability standards within a variety of clinical

12 settings, including an urban academic medical

13 center, a rural hospital, a community health

14 center, and a community hospital; and

15 (D) submit a report to the Congress con16 taining recommendations on such standards.

17 (2) CONSULTATION.—In developing or adopting

18 standards under paragraph (1)(A), the Secretary

19 shall consider the recommendations of the National

20 Committee on Vital Health Statistics for the stand21 ardization of message formatting, coding, and vocab22 ulary for interoperability of information technology

23 systems involved with health care delivery. The Sec24 retary shall consult with representatives of the

25 health information technology industry and the pro-
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1 vider community who are involved with the develop2 ment of interoperability standards.

3 (b) UPDATES.—The Secretary shall provide for the

4 ongoing review and periodic updating of the standards de5 veloped under subsection (a).

6 SEC. 103. REQUIRED USE OF PRODUCT IDENTIFICATION

7 TECHNOLOGY.

8 The Federal Food, Drug, and Cosmetic Act (21

9 U.S.C. 301 et seq.) is amended—

10 (1) in section 502, by adding at the end the fol11 lowing:

12 ‘‘(w) If it is a drug or biological product, unless it

13 includes a unique product identifier for the drug or bio14 logical product as required by regulations under section

15 510(q).’’; and

16 (2) in section 510, by adding at the end the fol17 lowing:

18 ‘‘(q)(1) The Secretary shall issue, and may periodi19 cally revise, regulations requiring the manufacturer of any

20 drug or biological product that is subject to regulation by

21 the Food and Drug Administration, or the packager or

22 labeler of a drug or biological product that is subject to

23 regulation by the Food and Drug Administration, to in24 clude a unique product identifier on the packaging of the

25 drug or biological product.
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1 ‘‘(2) For purposes of this subsection, the term

2 ‘unique product identifier’ means an identification that—

3 ‘‘(A) is affixed by the manufacturer, labeler, or

4 packager to each drug or biological product de5 scribed in paragraph (1) at each packaging level;

6 ‘‘(B) uniquely identifies the item and meets the

7 standards required by this section; and

8 ‘‘(C) can be read by a scanning device or other

9 technology acceptable to the Secretary.

10 ‘‘(3) A unique product identifier required by regula11 tions issued or revised under paragraph (1) shall be based

12 on—

13 ‘‘(A) the National Drug Code maintained by

14 the Food and Drug Administration;

15 ‘‘(B) commercially accepted standards estab16 lished by organizations that are accredited by the

17 American National Standards Institute, such as the

18 Health Industry Business Communication Council or

19 the Uniform Code Council; or

20 ‘‘(C) other identification formats that the Sec21 retary deems appropriate.

22 ‘‘(4) The Secretary may, at the Secretary’s discre23 tion, waive the requirements of this section, or add addi24 tional provisions that are necessary to safeguard the pub25 lic health.’’.
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1 SEC. 104. GRANTS FOR ELECTRONIC PRESCRIPTION PRO2 GRAMS.

3 (a) GRANTS.—

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

5 Human Services (in this section referred to as the

6 ‘‘Secretary’’) may make grants to qualified practi7 tioners for the purpose of establishing electronic pre8 scription programs.

9 (2) MATCHING FUNDS.—

10 (A) IN GENERAL.—With respect to the

11 costs of establishing an electronic prescription

12 program, a condition for the receipt of a grant

13 under paragraph (1) is that the qualified practi14 tioner involved agree to make available (directly

15 or through donations from public or private en16 tities) non-Federal contributions toward such

17 costs in an amount that is not less than 50 per18 cent of such costs.

19 (B) DETERMINATION OF AMOUNT CON20 TRIBUTED.—Non-Federal contributions re21 quired in subparagraph (A) may be in cash or

22 in kind, fairly evaluated, including equipment or

23 services. Amounts provided by the Federal Gov24 ernment, or services assisted or subsidized to

25 any significant extent by the Federal Govern-
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1 ment, may not be included in determining the

2 amount of such non-Federal contributions.

3 (b) STUDY.—

4 (1) IN GENERAL.—The Secretary, acting

5 through the Director of the Agency for Healthcare

6 Research and Quality, shall support a study to as7 sess existing scientific evidence regarding the effec8 tiveness and cost-effectiveness of the use of elec9 tronic prescription programs intended to improve the

10 efficiency of prescription ordering and the safe and

11 effective use of prescription drugs. The study shall

12 address the following:

13 (A) The ability of such programs to reduce

14 medical errors and improve the quality and

15 safety of patient care.

16 (B) The impact of the use of such pro17 grams on physicians, pharmacists, and patients,

18 including such factors as direct and indirect

19 costs, changes in productivity, and satisfaction.

20 (C) The effectiveness of strategies for over21 coming barriers to the use of electronic pre22 scription programs.

23 (2) REPORT.—The Secretary shall ensure that,

24 not later than 18 months after the date of the enact25 ment of this Act, a report containing the findings of
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1 the study under paragraph (1) is submitted to the

2 appropriate committees of the Congress.

3 (3) DISSEMINATION OF FINDINGS.—The Sec4 retary shall disseminate the findings of the study

5 under paragraph (1) to appropriate public and pri6 vate entities.

7 (c) DEVELOPMENT OF MODEL.—The Secretary, act8 ing through the Director of the Agency for Healthcare Re9 search and Quality, may develop an Internet-based mathe10 matical model that simulates the cost and effectiveness of

11 electronic prescription programs for qualified practi12 tioners. The model may be designed to allow qualified

13 practitioners to estimate, through an interactive interface,

14 the impact of electronic prescribing on their practices, in15 cluding the reduction in drug-related health care errors.

16 (d) DEFINITIONS.—For purposes of this section:

17 (1) The term ‘‘electronic prescription

18 program’’—

19 (A) means a program for the electronic

20 submission and processing of prescriptions; and

21 (B) includes the hardware (including com22 puters and other electronic devices) and soft23 ware programs for the electronic submission of

24 prescriptions to pharmacies, the processing of
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1 such submissions by pharmacies, and decision2 support programs.

3 (2) The term ‘‘qualified practitioner’’ means a

4 practitioner licensed by law to administer or dis5 pense prescription drugs.

6 SEC. 105. GRANTS TO HOSPITALS AND OTHER HEALTH

7 CARE PROVIDERS FOR INFORMATION TECH8 NOLOGIES.

9 (a) IN GENERAL.—The Secretary of Health and

10 Human Services (in this section referred to as the ‘‘Sec11 retary’’) shall make grants to hospitals and other health

12 care providers (but not more than 1 grant to any 1 hos13 pital or provider) to pay the costs of acquiring or imple14 menting information technologies whose purposes are—

15 (1) to improve quality of care and patient safe16 ty; and

17 (2) to reduce adverse events and health care

18 complications resulting from medication errors.

19 (b) SPECIAL CONSIDERATION.—In making grants

20 under subsection (a), the Secretary shall give special con21 sideration to applicants who seek to promote the following:

22 (1) Interoperability across hospital services or

23 departments using standards developed or adopted

24 by the Secretary under section 102.
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1 (2) Electronic communication of patient data

2 across the spectrum of health care delivery.

3 (3) Computerized physician order entry or bar

4 coding applications.

5 (4) Electronic communication of patient data in

6 hospitals that provide services to underserved or low7 income populations.

8 (5) Improved clinical decisionmaking through

9 acquisition and implementation of decision-support

10 technologies.

11 (c) CERTAIN GRANT CONDITIONS.—A condition for

12 the receipt of a grant under subsection (a) is that the ap13 plicant involved meet the following requirements:

14 (1) The applicant agrees to carry out a pro15 gram to measure, analyze, and report patient safety

16 and medical errors at the hospital or other health

17 care provider involved, to submit to the Secretary a

18 description of the methodology that will be used, and

19 to have such program in effect as soon as prac20 ticable after the application for the grant is ap21 proved, without regard to whether information tech22 nologies under the grant have been implemented.

23 (2) The applicant has arranged for an evalua24 tion that addresses the effectiveness and cost-effec25 tiveness of the information technology for which the
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1 grant is provided and its impact on the quality and

2 safety of patient care, submitted the evaluation plan

3 to the Secretary, and received approval from the

4 Secretary of the applicant’s methodology.

5 (3) The applicant has or is developing a patient

6 safety evaluation system (as that term is defined in

7 section 921 of the Public Health Service Act (as

8 amended by section 101)) for reporting health care

9 errors to a patient safety organization.

10 (4) The applicant agrees to provide the Sec11 retary with such information as the Secretary may

12 require regarding the use of funds under this pro13 gram or its impact.

14 (5) The applicant provides assurances satisfac15 tory to the Secretary that any information tech16 nology planned, acquired, or implemented with grant

17 funds under this section will be part of an informa18 tion program that—

19 (A) carries out the purposes described in

20 subsection (a); and

21 (B) is comprehensive or will be expanded

22 to become comprehensive, regardless of whether

23 Federal assistance is available for such expan24 sion.
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1 (d) TECHNICAL ASSISTANCE TO GRANTEES.—The

2 Secretary, acting through the Director of the Agency for

3 Healthcare Research and Quality, shall provide technical

4 assistance to applicants and grantees to ensure the appro5 priate evaluation of the information technologies for which

6 grants are awarded under this section, such as—

7 (1) reviewing and providing technical assistance

8 on the applicant’s proposed evaluation;

9 (2) developing mechanisms to ensure ongoing

10 communications between grantees and evaluators to

11 facilitate the identification and resolution of prob12 lems as they arise, ensure mutual learning, and pro13 mote the rapid dissemination of information;

14 (3) reviewing the interim and final reports re15 quired under subsection (e); and

16 (4) disseminating evidence-based information in

17 interim and final reports to patient safety organiza18 tions, as appropriate.

19 (e) EVALUATION REPORTS BY GRANTEE.—A condi20 tion for the receipt of a grant under subsection (a) is that

21 the applicant agree to submit an interim and a final report

22 to the Secretary in accordance with this subsection.

23 (1) INTERIM REPORT.—Not later than 1 year

24 after the implementation of information technologies

25 under the grant is completed, the applicant will sub-
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1 mit an interim report to the Secretary describing the

2 initial effectiveness of such technologies in carrying

3 out the purposes described in subsection (a).

4 (2) FINAL REPORT.—Not later than 3 years

5 after the implementation of information technologies

6 under the grant is completed, the applicant will sub7 mit a final report to the Secretary describing the ef8 fectiveness and cost-effectiveness of such tech9 nologies and addressing other issues determined to

10 be important in carrying out the purposes described

11 in subsection (a).

12 (3) RELATION TO DISBURSEMENT OF GRANT.—

13 In disbursing a grant under subsection (a), the Secretary shall withhold 1 14 ⁄3 of the grant until the grant15 ee submits to the Secretary the report required in

16 paragraph (1).

17 (f) REPORTS BY SECRETARY.—

18 (1) INTERIM REPORTS.—

19 (A) IN GENERAL.—Through the fiscal year

20 preceding the fiscal year in which the final re21 port under paragraph (2) is prepared, the Sec22 retary shall submit to the Committee on Energy

23 and Commerce of the House of Representatives

24 and the Committee on Health, Education,

25 Labor, and Pensions of the Senate periodic re-
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1 ports on the grant program under subsection

2 (a). Such reports shall be submitted not less

3 frequently than once each fiscal year, beginning

4 with fiscal year 2004.

5 (B) CONTENTS.—A report under subpara6 graph (A) shall include information on—

7 (i) the number of grants made;

8 (ii) the nature of the projects for

9 which funding is provided under the grant

10 program;

11 (iii) the geographic distribution of

12 grant recipients; and

13 (iv) such other matters as the Sec14 retary determines appropriate.

15 (2) FINAL REPORT.—Not later than 180 days

16 after the date on which the last of the reports is due

17 under subsection (e)(2), the Secretary shall submit

18 a final report to the committees referred to in para19 graph (1)(A) on the grant program under subsection

20 (a), together with such recommendations for legisla21 tion and administrative action as the Secretary de22 termines appropriate.

23 (g) DEFINITIONS.—For purposes of this section:
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1 (1) The term ‘‘costs’’, with respect to informa2 tion technologies referred to in subsection (a), in3 cludes total expenditures incurred for—

4 (A) purchasing, leasing, and installing

5 computer software and hardware, including

6 hand-held computer technologies;

7 (B) making improvements to existing com8 puter software and hardware; and

9 (C) purchasing or leasing communications

10 capabilities necessary for clinical data access,

11 storage, and exchange.

12 (2) The term ‘‘health care provider’’ has the

13 same meaning given to the term ‘‘provider’’ in sec14 tion 921 of the Public Health Services Act (as

15 amended by this Act).

16 (h) TERMINATION OF GRANT AUTHORITIES.—The

17 authority of the Secretary to make grants under sub18 section (a) terminates upon the expiration of fiscal year

19 2011.

20 (i) MATCHING FUNDS.—

21 (1) IN GENERAL.—With respect to the costs of

22 a grant to be carried out under this section, such

23 grant may be made only if the applicant agrees to

24 make available (directly or through donations from

25 public or private entities) non-Federal contributions
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1 toward such costs in an amount that is not less than

2 50 percent of such costs ($1 for each $1 of Federal

3 funds provided in the grant).

4 (2) DETERMINATION OF AMOUNTS CONTRIB5 UTED.—Amounts provided by the Federal Govern6 ment, or services assisted or subsidized to any sig7 nificant extent by the Federal Government, may not

8 be included in determining the amount of such non9 Federal contributions.

10 SEC. 106. AUTHORIZATION OF APPROPRIATIONS FOR

11 GRANTS UNDER SECTIONS 104 AND 105.

12 For the purpose of carrying out sections 104 and

13 105, there are authorized to be appropriated $25,000,000

14 for each of fiscal years 2004 and 2005.

15 TITLE II—MEDICAL INFORMA16 TION TECHNOLOGY ADVI17 SORY BOARD.

18 SEC. 201. MEDICAL INFORMATION TECHNOLOGY ADVISORY

19 BOARD.

20 Title XI of the Social Security Act is amended by

21 adding at the end the following new section:

22 ‘‘MEDICAL INFORMATION TECHNOLOGY ADVISORY BOARD

23 ‘‘SEC. 1180. (a) ESTABLISHMENT.—

24 ‘‘(1) IN GENERAL.—Not later than 3 months

25 after the date of the enactment of this section, the

26 Secretary shall appoint an advisory board to be
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1 known as the ‘Medical Information Technology Advi2 sory Board’ (in this section referred to as the

3 ‘MITAB’).

4 ‘‘(2) CHAIRMAN.—The Secretary shall des5 ignate one member as chairman. The chairman shall

6 be an individual affiliated with an organization hav7 ing expertise creating American National Standards

8 Institute (ANSI) accepted standards in health care

9 information technology and a member of the Na10 tional Committee for Vital and Health Statistics.

11 ‘‘(b) COMPOSITION.—

12 ‘‘(1) IN GENERAL.—The MITAB shall consist

13 of not more than 17 members that include—

14 ‘‘(A) experts from the fields of medical in15 formation, information technology, medical con16 tinuous quality improvement, medical records

17 security and privacy, individual and institu18 tional health care clinical providers, health re19 searchers, and health care purchasers;

20 ‘‘(B) one or more staff experts from each

21 of the following: the Centers for Medicare &

22 Medicaid Services, the Agency for Healthcare

23 Research and Quality, and the Institute of

24 Medicine of the National Academy of Sciences;
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1 ‘‘(C) representatives of private organiza2 tions with expertise in medical infomatics;

3 ‘‘(D) a representative of a teaching hos4 pital; and

5 ‘‘(E) one or more representatives of the

6 health care information technology industry.

7 ‘‘(2) TERMS OF APPOINTMENT.—The term of

8 any appointment under paragraph (1) to the

9 MITAB shall be for the life of the MITAB.

10 ‘‘(3) MEETINGS.—The MITAB shall meet at

11 the call of its chairman or a majority of its mem12 bers.

13 ‘‘(4) VACANCIES.—A vacancy on the MITAB

14 shall be filled in the same manner in which the origi15 nal appointment was made not later than 30 days

16 after the MITAB is given notice of the vacancy and

17 shall not affect the power of the remaining members

18 to execute the duties of the MITAB.

19 ‘‘(5) COMPENSATION.—Members of the MITAB

20 shall receive no additional pay, allowances, or bene21 fits by reason of their service on the MITAB.

22 ‘‘(6) EXPENSES.—Each member of the MITAB

23 shall receive travel expenses and per diem in lieu of

24 subsistence in accordance with sections 5702 and

25 5703 of title 5, United States Code.
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1 ‘‘(c) DUTIES.—

2 ‘‘(1) IN GENERAL.—The MITAB shall on an

3 ongoing basis advise, and make recommendations to,

4 the Secretary regarding medical information tech5 nology, including the following:

6 ‘‘(A) The best current practices in medical

7 information technology.

8 ‘‘(B) Methods for the adoption (not later

9 than 2 years after the date of the enactment of

10 this section) of a uniform health care informa11 tion system interface between and among old

12 and new computer systems.

13 ‘‘(C) Recommendations for health care vo14 cabulary, messaging, and other technology

15 standards (including a common lexicon for com16 puter technology) necessary to achieve the

17 interoperability of health care information sys18 tems for the purposes described in subpara19 graph (E).

20 ‘‘(D) Methods of implementing—

21 ‘‘(i) health care information tech22 nology interoperability standardization;

23 and

24 ‘‘(ii) records security.
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1 ‘‘(E) Methods to promote information ex2 change among health care providers so that

3 long-term compatibility among information sys4 tems is maximized, in order to do one or more

5 of the following:

6 ‘‘(i) To maximize positive outcomes in

7 clinical care—

8 ‘‘(I) by providing decision sup9 port for diagnosis and care; and

10 ‘‘(II) by assisting in the emer11 gency treatment of a patient pre12 senting at a facility where there is no

13 medical record for the patient.

14 ‘‘(ii) To contribute to (and be con15 sistent with) the development of the pa16 tient assessment instrument provided for

17 under section 545 of the Medicare, Med18 icaid, and SCHIP Benefits Improvement

19 and Protection Act of 2000, and to assist

20 in minimizing the need for new and dif21 ferent records as patients move from pro22 vider to provider.

23 ‘‘(iii) To reduce or eliminate the need

24 for redundant records, paperwork, and the
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1 repetitive taking of patient histories and

2 administering of tests.

3 ‘‘(iv) To minimize medical errors,

4 such as administration of contraindicated

5 drugs.

6 ‘‘(v) To provide a compatible informa7 tion technology architecture that facilitates

8 future quality and cost-saving needs and

9 that avoids the financing and development

10 of information technology systems that are

11 not readily compatible.

12 ‘‘(2) REPORTS.—

13 ‘‘(A) INITIAL REPORT.—No later than 18

14 months after the date of the enactment of this

15 section, the MITAB shall submit to Congress

16 and the Secretary an initial report concerning

17 the matters described in paragraph (1). The re18 port shall include—

19 ‘‘(i) the practices described in para20 graph (1)(A), including the status of

21 health care information technology stand22 ards being developed by private sector and

23 public-private groups;
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1 ‘‘(ii) recommendations for accelerating

2 the development of common health care

3 terminology standards;

4 ‘‘(iii) recommendations for completing

5 development of health care information

6 system messaging standards; and

7 ‘‘(iv) progress toward meeting the

8 deadline described in paragraph (1)(B) for

9 adoption of methods described in such

10 paragraph.

11 ‘‘(B) SUBSEQUENT REPORTS.—During

12 each of the 2 years after the year in which the

13 report is submitted under subparagraph (A),

14 the MITAB shall submit to Congress and the

15 Secretary an annual report relating to addi16 tional recommendations, best practices, results

17 of information technology improvements, anal18 yses of private sector efforts to implement the

19 interoperability standards established in section

20 102 of the Patient Safety and Quality Improve21 ment Act, and such other matters as may help

22 ensure the most rapid dissemination of best

23 practices in health care information technology.

24 ‘‘(d) STAFF AND SUPPORT SERVICES.—

25 ‘‘(1) EXECUTIVE DIRECTOR.—
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1 ‘‘(A) APPOINTMENT.—The Chairman shall

2 appoint an executive director of the MITAB.

3 ‘‘(B) COMPENSATION.—The executive di4 rector shall be paid the rate of basic pay for

5 level V of the Executive Schedule.

6 ‘‘(2) STAFF.—With the approval of the

7 MITAB, the executive director may appoint such

8 personnel as the executive director considers appro9 priate.

10 ‘‘(3) APPLICABILITY OF CIVIL SERVICE LAWS.—

11 The staff of the MITAB shall be appointed without

12 regard to the provisions of title 5, United States

13 Code, governing appointments in the competitive

14 service, and shall be paid without regard to the pro15 visions of chapter 51 and subchapter III of chapter

16 53 of such title (relating to classification and Gen17 eral Schedule pay rates).

18 ‘‘(4) EXPERTS AND CONSULTANTS.—With the

19 approval of the MITAB, the executive director may

20 procure temporary and intermittent services under

21 section 3109(b) of title 5, United States Code.

22 ‘‘(e) POWERS.—

23 ‘‘(1) HEARINGS AND OTHER ACTIVITIES.—For

24 the purpose of carrying out its duties, the MITAB

25 may hold such hearings and undertake such other
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1 activities as the MITAB determines to be necessary

2 to carry out its duties.

3 ‘‘(2) DETAIL OF FEDERAL EMPLOYEES.—Upon

4 the request of the MITAB, the head of any Federal

5 agency is authorized to detail, without reimburse6 ment, any of the personnel of such agency to the

7 MITAB to assist the MITAB in carrying out its du8 ties. Any such detail shall not interrupt or otherwise

9 affect the civil service status or privileges of the

10 Federal employee.

11 ‘‘(3) TECHNICAL ASSISTANCE.—Upon the re12 quest of the MITAB, the head of a Federal agency

13 shall provide such technical assistance to the

14 MITAB as the MITAB determines to be necessary

15 to carry out its duties.

16 ‘‘(4) OBTAINING INFORMATION.—The MITAB

17 may secure directly from any Federal agency infor18 mation necessary to enable it to carry out its duties,

19 if the information may be disclosed under section

20 552 of title 5, United States Code. Upon request of

21 the Chairman of the MITAB, the head of such agen22 cy shall furnish such information to the MITAB.

23 ‘‘(f) TERMINATION.—The MITAB shall terminate 30

24 days after the date of submission of its final report under

25 subsection (c)(2)(B).
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1 ‘‘(g) APPLICABILITY OF FACA.—The provisions of

2 the Federal Advisory Committee Act (5 U.S.C. App.) shall

3 apply to the MITAB.

4 ‘‘(h) FUNDING.—There are authorized to be appro5 priated such sums as are necessary for each fiscal year

6 to carry out this section.’’.

Passed the House of Representatives March 12,

2003.

Attest:

Clerk.