for the operation of the Board by not later than 
January 1, 2008. 
(2) SELECTION
OF
APPOINTED
MEMBERS.— 
With respect to the individuals appointed under 
paragraph (1)(B): 
(A) They shall be chosen on the basis of 
backgrounds in health policy, health economics, 
the healing professions, and the administration 
of health care institutions. 
(B) They shall provide a balanced point of 
view with respect to the various health care in-
terests and at least 2 of them shall represent 
the interests of individual consumers. 
(C) Not more than 3 of them shall be from 
the same political party. 
(D) To the greatest extent feasible, they 
shall represent the various geographic regions 
of the United States and shall reflect the racial, 
ethnic, and gender composition of the popu-
lation of the United States. 
(3) TERMS OF APPOINTED MEMBERS.—Individ-
uals appointed under paragraph (1)(B) shall serve 
for a term of 6 years, except that the terms of 5 of 
the individuals initially appointed shall be, as des-
ignated by the President at the time of their ap-
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pointment, for 1, 2, 3, 4, and 5 years. During a 
term of membership on the Board, no member shall 
engage in any other business, vocation or employ-
ment. 
(c) VACANCIES.— 
(1) IN GENERAL.—The President shall fill any 
vacancy in the membership of the Board in the same 
manner as the original appointment. The vacancy 
shall not affect the power of the remaining members 
to execute the duties of the Board. 
(2) VACANCY
APPOINTMENTS.—Any member 
appointed to fill a vacancy shall serve for the re-
mainder of the term for which the predecessor of the 
member was appointed. 
(3) REAPPOINTMENT.—The President may re-
appoint an appointed member of the Board for a 
second term in the same manner as the original ap-
pointment. A member who has served for 2 consecu-
tive 6-year terms shall not be eligible for reappoint-
ment until 2 years after the member has ceased to 
serve. 
(4) REMOVAL FOR CAUSE.—Upon confirmation, 
members of the Board may not be removed except 
by the President for cause. 
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(d) CHAIR.—The President shall designate 1 of the 
members of the Board, other than the Secretary, to serve 
at the will of the President as Chair of the Board. 
(e) COMPENSATION.—Members of the Board (other 
than the Secretary) shall be entitled to compensation at 
a level equivalent to level II of the Executive Schedule, 
in accordance with section 5313 of title 5, United States 
Code. 
(f) GENERAL DUTIES OF THE BOARD.— 
(1) IN
GENERAL.—The Board shall develop 
policies, procedures, guidelines, and requirements to 
carry out this Act, including those related to— 
(A) eligibility; 
(B) enrollment; 
(C) benefits; 
(D) provider participation standards and 
qualifications, as defined in title III; 
(E) national and State funding levels; 
(F) methods for determining amounts of 
payments to providers of covered services, con-
sistent with subtitle B of title VI; 
(G) the determination of medical necessity 
and appropriateness with respect to coverage of 
certain services; 
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(H) assisting State health security pro-
grams with planning for capital expenditures 
and service delivery; 
(I) planning for health professional edu-
cation funding (as specified in title VI); 
(J) allocating funds provided under title 
VII; and 
(K) encouraging States to develop regional 
planning mechanisms (described in section 
404(a)(3)). 
(2) REGULATIONS.—Regulations authorized by 
this Act shall be issued by the Board in accordance 
with the provisions of section 553 of title 5, United 
States Code. 
(g) UNIFORM REPORTING STANDARDS; ANNUAL RE-
PORT; STUDIES.— 
(1) UNIFORM REPORTING STANDARDS.— 
(A) IN GENERAL.—The Board shall estab-
lish uniform reporting requirements and stand-
ards to ensure an adequate national data base 
regarding health services practitioners, services 
and finances of State health security programs, 
approved plans, providers, and the costs of fa-
cilities and practitioners providing services. 
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Such standards shall include, to the maximum 
extent feasible, health outcome measures. 
(B) REPORTS.—The Board shall analyze 
regularly information reported to it, and to 
State health security programs pursuant to 
such requirements and standards. 
(2) ANNUAL REPORT.—Beginning January 1, 
of the second year beginning after the date of the 
enactment of this Act, the Board shall annually re-
port to Congress on the following: 
(A) The status of implementation of the 
Act. 
(B) Enrollment under this Act. 
(C) Benefits under this Act. 
(D) Expenditures and financing under this 
Act. 
(E) 
Cost-containment 
measures 
and 
achievements under this Act. 
(F) Quality assurance. 
(G) Health care utilization patterns, in-
cluding any changes attributable to the pro-
gram. 
(H) Long-range plans and goals for the de-
livery of health services. 
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(I) Differences in the health status of the 
populations of the different States, including in-
come and racial characteristics. 
(J) Necessary changes in the education of 
health personnel. 
(K) Plans for improving service to medi-
cally underserved populations. 
(L) Transition problems as a result of im-
plementation of this Act. 
(M) Opportunities for improvements under 
this Act. 
(3) STATISTICAL ANALYSES AND OTHER STUD-
IES.—The Board may, either directly or by con-
tract— 
(A) make statistical and other studies, on 
a nationwide, regional, state, or local basis, of 
any aspect of the operation of this Act, includ-
ing studies of the effect of the Act upon the 
health of the people of the United States and 
the effect of comprehensive health services upon 
the health of persons receiving such services; 
(B) develop and test methods of providing 
through payment for services or otherwise, ad-
ditional incentives for adherence by providers to 
standards of adequacy, access, and quality; 
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methods of consumer and peer review and peer 
control of the utilization of drugs, of laboratory 
services, and of other services; and methods of 
consumer and peer review of the quality of serv-
ices; 
(C) develop and test, for use by the Board, 
records and information retrieval systems and 
budget systems for health services administra-
tion, and develop and test model systems for 
use by providers of services; 
(D) develop and test, for use by providers 
of services, records and information retrieval 
systems useful in the furnishing of preventive 
or diagnostic services; 
(E) develop, in collaboration with the phar-
maceutical profession, and test, improved ad-
ministrative practices or improved methods for 
the reimbursement of independent pharmacies 
for the cost of furnishing drugs as a covered 
service; and 
(F) make such other studies as it may con-
sider necessary or promising for the evaluation, 
or for the improvement, of the operation of this 
Act. 
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(4) REPORT
ON
USE
OF
EXISTING
FEDERAL 
HEALTH CARE FACILITIES.—Not later than 1 year 
after the date of the enactment of this Act, the 
Board shall recommend to the Congress one or more 
proposals for the treatment of health care facilities 
of the Federal Government. 
(h) EXECUTIVE DIRECTOR.— 
(1) APPOINTMENT.—There is hereby estab-
lished the position of Executive Director of the 
Board. The Director shall be appointed by the 
Board and shall serve as secretary to the Board and 
perform such duties in the administration of this 
title as the Board may assign. 
(2) DELEGATION.—The Board is authorized to 
delegate to the Director or to any other officer or 
employee of the Board or, with the approval of the 
Secretary of Health and Human Services (and sub-
ject to reimbursement of identifiable costs), to any 
other officer or employee of the Department of 
Health and Human Services, any of its functions or 
duties under this Act other than— 
(A) the issuance of regulations; or 
(B) the determination of the availability of 
funds and their allocation to implement this 
Act. 
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(3) COMPENSATION.—The Executive Director 
of the Board shall be entitled to compensation at a 
level equivalent to level III of the Executive Sched-
ule, in accordance with section 5314 of title 5, 
United States Code. 
(i) INSPECTOR GENERAL.—The Inspector General 
Act of 1978 (5 U.S.C. App.) is amended— 
(1) in section 11(1), by inserting after ‘‘Cor-
poration;’’ the first place it appears the following: 
‘‘the Chair of the American Health Security Stand-
ards Board;’’; 
(2) in section 11(2), by inserting after ‘‘Resolu-
tion Trust Corporation,’’ the following: ‘‘the Amer-
ican Health Security Standards Board,’’; and 
(3) by inserting before section 9 the following: 
‘‘SPECIAL PROVISIONS CONCERNING AMERICAN HEALTH 
SECURITY STANDARDS BOARD 
‘‘SEC. 8L. The Inspector General of the American 
Health Security Standards Board, in addition to the other 
authorities vested by this Act, shall have the same author-
ity, with respect to the Board and the American Health 
Security Program under this Act, as the Inspector General 
for the Department of Health and Human Services has 
with respect to the Secretary of Health and Human Serv-
ices and the medicare and medicaid programs, respec-
tively.’’. 
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(j) STAFF.—The Board shall employ such staff as the 
Board may deem necessary. 
(k) ACCESS
TO INFORMATION.—The Secretary of 
Health and Human Services shall make available to the 
Board all information available from sources within the 
Department or from other sources, pertaining to the du-
ties of the Board. 
SEC. 402. AMERICAN HEALTH SECURITY ADVISORY COUN-
CIL. 
(a) IN GENERAL.—The Board shall provide for an 
American Health Security Advisory Council (in this sec-
tion referred to as the ‘‘Council’’) to advise the Board on 
its activities. 
(b) MEMBERSHIP.—The Council shall be composed 
of— 
(1) the Chair of the Board, who shall serve as 
Chair of the Council; and 
(2) twenty members, not otherwise in the em-
ploy of the United States, appointed by the Board 
without regard to the provisions of title 5, United 
States Code, governing appointments in the competi-
tive service. 
The appointed members shall include, in accordance with 
subsection (e), individuals who are representative of State 
health security programs, public health professionals, pro-
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