I 
110TH CONGRESS 
2D SESSION 
H. R. 5545 
To amend title XVIII of the Social Security Act to modify Medicare physician 
reimbursement policies to ensure a future physician workforce, and for 
other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 6, 2008 
Mr. BURGESS introduced the following bill; which was referred to the Com-
mittee on Energy and Commerce, and in addition to the Committee on 
Ways and Means, 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 amend title XVIII of the Social Security Act to modify 
Medicare physician reimbursement policies to ensure a 
future physician workforce, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Ensuring the Future Physician Workforce Act of 2008’’. 
(b) TABLE OF CONTENTS.—The table of contents of 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
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TITLE I—PAYMENT AND QUALITY INCENTIVES 
Sec. 101. Resetting to 2007 the base year for application of sustainable growth 
rate formula; elimination of sustainable growth rate formula in 
2010. 
Sec. 102. Quality incentives. 
TITLE II—HEALTH INFORMATION TECHNOLOGY INCENTIVES 
Sec. 201. Health information technology (HIT) payment incentive. 
Sec. 202. Safe harbors to antikickback, civil penalties, and criminal penalties 
for provision of health information technology and training 
services. 
Sec. 203. Exception to limitation on certain physician referrals (under Stark) 
for provision of Health Information Technology and training 
services to health care professionals. 
Sec. 204. Rules of construction regarding use of consortia. 
TITLE III—INFORMATION AND REPORTS 
Sec. 301. Information for physicians on Medicare billings. 
Sec. 302. Information for beneficiaries on Medicare expenditures. 
Sec. 303. Collection of data on Medicare savings from physicians’ services di-
version. 
Sec. 304. Trustees’ ongoing examination of Medicare funding. 
Sec. 305. Independent study on Medicare Relative Value Unit Scale Update 
Committee (RUC) process. 
Sec. 306. Study of reporting requirements on health care disparities. 
TITLE I—PAYMENT AND 
QUALITY INCENTIVES 
SEC. 101. RESETTING TO 2007 THE BASE YEAR FOR APPLI-
CATION OF SUSTAINABLE GROWTH RATE 
FORMULA; ELIMINATION OF SUSTAINABLE 
GROWTH RATE FORMULA IN 2010. 
(a) IN GENERAL.—Section 1848(d) of the Social Se-
curity Act (42 U.S.C. 1395w–4(d)), as amended by section 
101 of the Medicare, Medicaid, and SCHIP Extension Act 
of 2007 (Public Law 110–173), is amended— 
(1) in paragraph (4)— 
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(A) in subparagraph (B), by striking ‘‘sub-
paragraph (D)’’ and inserting ‘‘subparagraphs 
(D) and (G)’’; and 
(B) by adding at the end the following new 
subparagraph: 
‘‘(G) REBASING TO 2007 FOR UPDATE AD-
JUSTMENTS BEGINNING WITH JULY 1, 2008.—In 
determining the update adjustment factor 
under subparagraph (B) for 2008, for the pe-
riod beginning on July 1, 2008, and ending on 
December 31, 2008, and 2009— 
‘‘(i) the allowed expenditures for 2007 
shall be equal to the amount of the actual 
expenditures for physicians’ services during 
2007; 
‘‘(ii) subparagraph (B)(ii) shall not 
apply to 2008, for the period beginning on 
July 1, 2008, and ending on December 31, 
2008; and 
‘‘(iii) the reference in subparagraph 
(B)(ii)(I) to ‘April 1, 1996’ shall be treat-
ed, beginning with 2009, as a reference to 
‘January 1, 2007’.’’; and 
(2) by adding at the end the following new 
paragraph: 
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‘‘(9) UPDATING
BEGINNING
WITH
2010.—The 
update to the single conversion factor for each year 
beginning with 2010 shall be the percentage increase 
in the MEI (as defined in section 1842(i)(3)) for 
that year.’’. 
(b) CONFORMING SUNSET.—Section 1848(f)(1)(B) 
of such Act is amended by inserting ‘‘(ending with 2008)’’ 
after ‘‘each succeeding year’’. 
SEC. 102. QUALITY INCENTIVES. 
(a) EXTENSION OF CURRENT TRANSITIONAL BONUS 
INCENTIVE PAYMENTS FOR 2009.—Section 101(c) of divi-
sion B of the Tax Relief and Health Care Act of 2006 
(42 U.S.C. 1395w–4 note), as amended by section 101 
of the Medicare, Medicaid, and SCHIP Extension Act of 
2007 (Public Law 110–173), is amended— 
(1) in the heading, by striking ‘‘AND 2008’’ and 
inserting ‘‘, 2008, AND 2009’’; 
(2) in paragraph (1), by inserting ‘‘(or 3 per-
cent in the case of the reporting periods beginning 
after December 31, 2008)’’ after ‘‘1.5 percent’’; and 
(3) in paragraph (6)(C)— 
(A) in clause (i), by striking ‘‘and’’ at the 
end; 
(B) in clause (ii), by striking the period at 
the end and inserting ‘‘; and’’; and 
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(C) by adding at the end the following new 
clause: 
‘‘(III) for 2009, all of 2009.’’. 
(b) ESTABLISHMENT OF NEW QUALITY INCENTIVE 
SYSTEM EFFECTIVE IN 2010.— 
(1) IN GENERAL.—Section 1848 of the Social 
Security Act (42 U.S.C. 1395w) is amended by 
striking subsection (k) and inserting the following: 
‘‘(k) PHYSICIAN QUALITY INCENTIVE SYSTEM.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish a reporting system (in this subsection referred 
to as the ‘Physician Quality Incentive System’ or 
‘System’) for quality measures relating to physi-
cians’ services that focuses on disease-specific high 
cost conditions. Not later than January 1, 2010, the 
Secretary shall— 
‘‘(A) identify the 10 health conditions that 
have the highest proportion of spending under 
this part, due in part to a gap in patient care, 
and for which reporting measures are feasible; 
and 
‘‘(B) adopt reporting measures on these 
conditions, based on measures developed by the 
Physician Consortium of the American Medical 
Association. 
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‘‘(2) ADD-ON PAYMENT.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
provide, in a form and manner specified by the 
Secretary, for a bonus or other add-on payment 
for physicians that submit information required 
on the conditions identified under paragraph 
(1). 
‘‘(B) AMOUNT.—Such a bonus or add-on 
payment shall be equal to 1.0 percent of the 
payment amount otherwise computed under this 
section. 
‘‘(C) TIMELY
PAYMENTS.—Such a pay-
ment shall be made, with respect to information 
submitted for a month, by not later than 30 
days after the date the information is submitted 
for such month. 
‘‘(D) DEDUCTIBLE AND COINSURANCE NOT 
APPLICABLE.—Such payment shall not be sub-
ject to the deductible or coinsurance otherwise 
applicable to physicians’ services under this 
part. 
‘‘(E) USE OF REGISTRY.—In carrying out 
subparagraph (A), the Secretary shall allow the 
submission of the required information through 
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an appropriate medical registry identified by 
the Secretary. 
‘‘(3) MONITORING.—The Secretary shall mon-
itor and report to Congress on an annual basis phy-
sician participation in the Physician Quality Incen-
tive System, administrative burden encountered by 
participants, barriers to participation, as well as sav-
ings accrued to the Medicare program due to quality 
care improvements based on measures established 
under the Physician Quality Incentive System.’’. 
(2) EFFECTIVE DATE.—The amendment made 
by paragraph (1) shall apply to payment for physi-
cians’ services for services furnished in years begin-
ning with 2010. 
TITLE 
II—HEALTH 
INFORMA-
TION 
TECHNOLOGY 
INCEN-
TIVES 
SEC. 201. HEALTH INFORMATION TECHNOLOGY (HIT) PAY-
MENT INCENTIVE. 
Section 1848 of the Social Security Act is amended 
by adding at the end the following new subsection: 
‘‘(m) HEALTH INFORMATION TECHNOLOGY PAY-
MENT INCENTIVES.— 
‘‘(1) STANDARDS.—Not later than January 1, 
2009, the Secretary shall create standards for the 
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certification of health information technology used in 
the furnishing of physicians’ services. 
‘‘(2) ADD-ON PAYMENT.—The Secretary shall 
provide for a bonus or other add-on payment for 
physicians that implement a health information tech-
nology system that is certified under paragraph (1). 
Such a bonus shall be equal to 3.0 percent of the 
payment amount otherwise computed under this sec-
tion, except that— 
‘‘(A) in no case may the total of such 
bonus and the bonus provided under subsection 
(k)(2) exceed 6 percent of such payment 
amount; and 
‘‘(B) such payments with respect to a phy-
sician shall only apply to physicians’ services 
furnished during a period of 36 consecutive 
months beginning with the first day of the first 
month after the date of such certification. 
The bonus payment under this paragraph shall not 
be subject to the deductible or coinsurance otherwise 
applicable to physicians’ services under this part.’’. 
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SEC. 202. SAFE HARBORS TO ANTIKICKBACK, CIVIL PEN-
ALTIES, AND CRIMINAL PENALTIES FOR PRO-
VISION OF HEALTH INFORMATION TECH-
NOLOGY AND TRAINING SERVICES. 
(a) FOR CIVIL PENALTIES.—Section 1128A of the 
Social Security Act (42 U.S.C. 1320a–7a) is amended— 
(1) in subsection (b), by adding at the end the 
following new paragraph: 
‘‘(4) For purposes of this subsection, inducements to 
reduce or limit services described in paragraph (1) shall 
not include the practical or other advantages resulting 
from health information technology or related installation, 
maintenance, support, or training services.’’; and 
(2) in subsection (i), by adding at the end the 
following new paragraph: 
‘‘(8) The term ‘health information technology’ 
means hardware, software, license, right, intellectual 
property, equipment, or other information tech-
nology (including new versions, upgrades, and 
connectivity) designed or provided primarily for the 
electronic creation, maintenance, or exchange of 
health information to better coordinate care or im-
prove health care quality, efficiency, or research.’’. 
(b) FOR CRIMINAL PENALTIES.—Section 1128B of 
such Act (42 U.S.C. 1320a–7b) is amended— 
(1) in subsection (b)(3)— 
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(A) in subparagraph (G), by striking 
‘‘and’’ at the end; 
(B) in the subparagraph (H) added by sec-
tion 237(d) of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003 
(Public Law 108–173; 117 Stat. 2213)— 
(i) by moving such subparagraph 2 
ems to the left; and 
(ii) by striking the period at the end 
and inserting a semicolon; 
(C) in the subparagraph (H) added by sec-
tion 431(a) of such Act (117 Stat. 2287)— 
(i) by redesignating such subpara-
graph as subparagraph (I); 
(ii) by moving such subparagraph 2 
ems to the left; and 
(iii) by striking the period at the end 
and inserting ‘‘; and’’; and 
(D) by adding at the end the following new 
subparagraph: 
‘‘(J) any nonmonetary remuneration (in the 
form of health information technology, as defined in 
section 1128A(i)(8), or related installation, mainte-
nance, support, or training services) made to a per-
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son by a specified entity (as defined in subsection 
(g)) if— 
‘‘(i) the provision of such remuneration is 
without an agreement between the parties or 
legal condition that— 
‘‘(I) limits or restricts the use of the 
health information technology to services 
provided by the physician to individuals re-
ceiving services at the specified entity; 
‘‘(II) limits or restricts the use of the 
health information technology in conjunc-
tion with other health information tech-
nology; or 
‘‘(III) conditions the provision of such 
remuneration on the referral of patients or 
business to the specified entity; 
‘‘(ii) such remuneration is arranged for in 
a written agreement that is signed by the par-
ties involved (or their representatives) and that 
specifies the remuneration solicited or received 
(or offered or paid) and states that the provi-
sion of such remuneration is made for the pri-
mary purpose of better coordination of care or 
improvement of health quality, efficiency, or re-
search; and 
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‘‘(iii) the specified entity providing the re-
muneration (or a representative of such entity) 
has not taken any action to disable any basic 
feature of any hardware or software component 
of such remuneration that would permit inter-
operability.’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(g) SPECIFIED ENTITY DEFINED.—For purposes of 
subsection (b)(3)(J), the term ‘specified entity’ means an 
entity that is a hospital, group practice, prescription drug 
plan sponsor, a Medicare Advantage organization, or any 
other such entity specified by the Secretary, considering 
the goals and objectives of this section, as well as the goals 
to better coordinate the delivery of health care and to pro-
mote the adoption and use of health information tech-
nology.’’. 
(c) EFFECTIVE DATE
AND EFFECT
ON STATE 
LAWS.— 
(1) EFFECTIVE DATE.—The amendments made 
by subsections (a) and (b) shall take effect on the 
date that is 120 days after the date of the enact-
ment of this Act. 
(2) PREEMPTION OF STATE LAWS.—No State 
(as defined in section 1101(a) of the Social Security 
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Act (42 U.S.C. 1301(a)) for purposes of title XI of 
such Act) shall have in effect a State law that im-
poses a criminal or civil penalty for a transaction de-
scribed 
in 
section 
1128A(b)(4) 
or 
section 
1128B(b)(3)(J) of such Act, as added by subsections 
(a)(1) and (b), respectively, if the conditions de-
scribed in the respective provision, with respect to 
such transaction, are met. 
(d) STUDY AND REPORT TO ASSESS EFFECT OF 
SAFE HARBORS ON HEALTH SYSTEM.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study to determine 
the impact of each of the safe harbors described in 
paragraph (3). In particular, the study shall examine 
the following: 
(A) The effectiveness of each safe harbor 
in increasing the adoption of health information 
technology. 
(B) The types of health information tech-
nology provided under each safe harbor. 
(C) The extent to which the financial or 
other business relationships between providers 
under each safe harbor have changed as a re-
sult of the safe harbor in a way that adversely 
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affects or benefits the health care system or 
choices available to consumers. 
(D) The impact of the adoption of health 
information technology on health care quality, 
cost, and access under each safe harbor. 
(2) REPORT.—Not later than three years after 
the effective date described in subsection (c)(1), the 
Secretary of Health and Human Services shall sub-
mit to Congress a report on the study under para-
graph (1). 
(3) SAFE HARBORS DESCRIBED.—For purposes 
of paragraphs (1) and (2), the safe harbors de-
scribed in this paragraph are— 
(A) 
the 
safe 
harbor 
under 
section 
1128A(b)(4) of such Act (42 U.S.C. 1320a– 
7a(b)(4)), as added by subsection (a)(1); and 
(B) 
the 
safe 
harbor 
under 
section 
1128B(b)(3)(J) of such Act (42 U.S.C. 1320a– 
7b(b)(3)(J)), as added by subsection (b). 
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SEC. 203. EXCEPTION TO LIMITATION ON CERTAIN PHYSI-
CIAN REFERRALS (UNDER STARK) FOR PRO-
VISION OF HEALTH INFORMATION TECH-
NOLOGY 
AND 
TRAINING 
SERVICES 
TO 
HEALTH CARE PROFESSIONALS. 
(a) IN GENERAL.—Section 1877(b) of the Social Se-
curity Act (42 U.S.C. 1395nn(b)) is amended by adding 
at the end the following new paragraph: 
‘‘(6) INFORMATION TECHNOLOGY AND TRAIN-
ING SERVICES.— 
‘‘(A) IN GENERAL.—Any nonmonetary re-
muneration (in the form of health information 
technology or related installation, maintenance, 
support or training services) made by a speci-
fied entity to a physician if— 
‘‘(i) the provision of such remunera-
tion is without an agreement between the 
parties or legal condition that— 
‘‘(I) limits or restricts the use of 
the health information technology to 
services provided by the physician to 
individuals receiving services at the 
specified entity; 
‘‘(II) limits or restricts the use of 
the health information technology in 
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conjunction with other health informa-
tion technology; or 
‘‘(III) conditions the provision of 
such remuneration on the referral of 
patients or business to the specified 
entity; 
‘‘(ii) such remuneration is arranged 
for in a written agreement that is signed 
by the parties involved (or their represent-
atives) and that specifies the remuneration 
made and states that the provision of such 
remuneration is made for the primary pur-
pose of better coordination of care or im-
provement of health quality, efficiency, or 
research; and 
‘‘(iii) the specified entity (or a rep-
resentative of such entity) has not taken 
any action to disable any basic feature of 
any hardware or software component of 
such remuneration that would permit 
interoperability. 
‘‘(B) HEALTH INFORMATION TECHNOLOGY 
DEFINED.—For purposes of this paragraph, the 
term ‘health information technology’ means 
hardware, software, license, right, intellectual 
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property, equipment, or other information tech-
nology (including new versions, upgrades, and 
connectivity) designed or provided primarily for 
the electronic creation, maintenance, or ex-
change of health information to better coordi-
nate care or improve health care quality, effi-
ciency, or research. 
‘‘(C) SPECIFIED
ENTITY
DEFINED.—For 
purposes of this paragraph, the term ‘specified 
entity’ means an entity that is a hospital, group 
practice, prescription drug plan sponsor, a 
Medicare Advantage organization, or any other 
such entity specified by the Secretary, consid-
ering the goals and objectives of this section, as 
well as the goals to better coordinate the deliv-
ery of health care and to promote the adoption 
and use of health information technology.’’. 
(b) EFFECTIVE DATE; EFFECT ON STATE LAWS.— 
(1) EFFECTIVE DATE.—The amendment made 
by subsection (a) shall take effect on the date that 
is 120 days after the date of the enactment of this 
Act. 
(2) PREEMPTION OF STATE LAWS.—No State 
(as defined in section 1101(a) of the Social Security 
Act (42 U.S.C. 1301(a)) for purposes of title XI of 
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such Act) shall have in effect a State law that im-
poses a criminal or civil penalty for a transaction de-
scribed in section 1877(b)(6) of such Act, as added 
by subsection (a), if the conditions described in such 
section, with respect to such transaction, are met. 
(c) STUDY AND REPORT TO ASSESS EFFECT OF EX-
CEPTION ON HEALTH SYSTEM.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study to determine 
the impact of the exception under section 1877(b)(6) 
of such Act (42 U.S.C. 1395nn(b)(6)), as added by 
subsection (a). In particular, the study shall examine 
the following: 
(A) The effectiveness of the exception in 
increasing the adoption of health information 
technology. 
(B) The types of health information tech-
nology provided under the exception. 
(C) The extent to which the financial or 
other business relationships between providers 
under the exception have changed as a result of 
the exception in a way that adversely affects or 
benefits the health care system or choices avail-
able to consumers. 
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(D) The impact of the adoption of health 
information technology on health care quality, 
cost, and access under the exception. 
(2) REPORT.—Not later than three years after 
the effective date described in subsection (b)(1), the 
Secretary of Health and Human Services shall sub-
mit to Congress a report on the study conducted 
under paragraph (1). 
SEC. 204. RULES OF CONSTRUCTION REGARDING USE OF 
CONSORTIA. 
(a) APPLICATION TO SAFE HARBOR FROM CRIMINAL 
PENALTIES.—Section 1128B(b)(3) of the Social Security 
Act (42 U.S.C. 1320a–7b(b)(3)) is amended by adding 
after and below subparagraph (J), as added by section 
202(b)(1), the following: ‘‘For purposes of subparagraph 
(J), nothing in such subparagraph shall be construed as 
preventing a specified entity, consistent with the specific 
requirements of such subparagraph, from forming a con-
sortium composed of health care providers, payers, em-
ployers, and other interested entities to collectively pur-
chase and donate health information technology, or from 
offering health care providers a choice of health informa-
tion technology products in order to take into account the 
varying needs of such providers receiving such products.’’. 
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(b) APPLICATION
TO STARK EXCEPTION.—Para-
graph (6) of section 1877(b) of the Social Security Act 
(42 U.S.C. 1395nn(b)), as added by section 203(a), is 
amended by adding at the end the following new subpara-
graph: 
‘‘(D) RULE OF CONSTRUCTION.—For pur-
poses of subparagraph (A), nothing in such 
subparagraph shall be construed as preventing 
a specified entity, consistent with the specific 
requirements of such subparagraph, from— 
‘‘(i) forming a consortium composed 
of health care providers, payers, employers, 
and other interested entities to collectively 
purchase and donate health information 
technology; or 
‘‘(ii) offering health care providers a 
choice of health information technology 
products in order to take into account the 
varying needs of such providers receiving 
such products.’’. 
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TITLE III—INFORMATION AND 
REPORTS 
SEC. 301. INFORMATION FOR PHYSICIANS ON MEDICARE 
BILLINGS. 
(a) IN GENERAL.—Section 1848 of the Social Secu-
rity Act, as amended by section 201, is amended by adding 
at the end the following new subsection: 
‘‘(n) ANNUAL REPORTING OF INFORMATION TO PHY-
SICIANS.— 
‘‘(1) IN GENERAL.—The Secretary shall annu-
ally report to each physician information on total bil-
lings by the physician (including laboratory tests 
and other items and services ordered by the physi-
cian) under this title. Such information shall be pro-
vided in a comparative format by code, weighting for 
practice size, number of Medicare patients treated, 
and relative number of Medicare beneficiaries in the 
geographical area. 
‘‘(2) CONFIDENTIALITY.—Information reported 
under paragraph (1) is confidential and shall not be 
disclosed to anyone other than the physician to 
whom the information relates. 
‘‘(3) REPORT
NOT
TO
BE
USED
IN
DETER-
MINING
REIMBURSEMENT
RATES
FOR
A
SPECIFIC 
PHYSICIAN.—The Secretary shall not use informa-
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tion contained in a report under this subsection with 
respect to a physician in determining reimbursement 
rates under this part for items and services fur-
nished by that physician.’’. 
(b) EFFECTIVE DATE.—The Secretary of Health and 
Human Services shall first provide for reporting of infor-
mation under the amendment made by subsection (a) for 
billings during 2007. 
SEC. 302. INFORMATION FOR BENEFICIARIES ON MEDI-
CARE EXPENDITURES. 
(a) IN GENERAL.—Section 1804 of the Social Secu-
rity Act (42 U.S.C. 1395b–2) is amended by adding at 
the end the following new subsection: 
‘‘(d) ANNUAL REPORT ON INDIVIDUAL RESOURCE 
UTILIZATION.—The Secretary shall provide for the report-
ing, on an annual basis, to each individual entitled to ben-
efits under part A or enrolled under part B, on the amount 
of payments made to or on behalf of the individual under 
this title during the year involved. Such information shall 
be provided in a format that compares such amount with 
the average per capita expenditures in the region or area 
involved.’’. 
(b) EFFECTIVE DATE.—The Secretary of Health and 
Human Services shall first provide for reporting of infor-
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mation under the amendment made by subsection (a) for 
payments made during 2007. 
SEC. 303. COLLECTION OF DATA ON MEDICARE SAVINGS 
FROM PHYSICIANS’ SERVICES DIVERSION. 
(a) IN GENERAL.—The Secretary of Health and 
Human Services shall collect data on annual savings in 
expenditures in the Medicare program due to physicians’ 
services that resulted in hospital or in-patient diversion. 
(b) REPORT.—The Secretary shall transmit to Con-
gress annually a summary of the data collected under sub-
section (a). 
SEC. 304. TRUSTEES’ ONGOING EXAMINATION OF MEDI-
CARE FUNDING. 
(a) EXAMINATION BY BOARD OF TRUSTEES.—The 
Board of Trustees of the Federal Hospital Insurance 
Trust Fund under section 1817 of the Social Security Act 
(42 U.S.C. 1395i) and of the Federal Supplementary Med-
ical Insurance Trust Fund under section 1841 of such Act 
(42 U.S.C. 1395t) shall monitor and examine the extent 
to which the different funding mechanisms under parts A, 
B, and D of title XVIII of such Act provide an appropriate 
alignment with the program goals of the respective parts. 
Such examination shall include an analysis of each of the 
following: 
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