189 
(11) PERSONAL HEALTH RECORD.—The term 
‘‘personal health record’’ means an electronic record 
of individually identifiable health information on an 
individual that can be drawn from multiple sources 
and that is managed, shared, and controlled by or 
for the individual. 
(12) PROTECTED HEALTH INFORMATION.—The 
term ‘‘protected health information’’ has the mean-
ing given such term in section 160.103 of title 45, 
Code of Federal Regulations. 
(13) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means the Secretary of Health and Human Services. 
(14) SECURITY.—The term ‘‘security’’ has the 
meaning given such term in section 164.304 of title 
45, Code of Federal Regulations. 
(15) STATE.—The term ‘‘State’’ means each of 
the several States, the District of Columbia, Puerto 
Rico, the Virgin Islands, Guam, American Samoa, 
and the Northern Mariana Islands. 
(16) TREATMENT.—The term ‘‘treatment’’ has 
the meaning given such term in section 164.501 of 
title 45, Code of Federal Regulations. 
(17) USE.—The term ‘‘use’’ has the meaning 
given such term in section 160.103 of title 45, Code 
of Federal Regulations. 
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(18) 
VENDOR
OF
PERSONAL
HEALTH 
RECORDS.—The term ‘‘vendor of personal health 
records’’ means an entity, other than a covered enti-
ty (as defined in paragraph (3)), that offers or 
maintains a personal health record. 
PART I—IMPROVED PRIVACY PROVISIONS AND 
SECURITY PROVISIONS 
SEC. 4401. APPLICATION OF SECURITY PROVISIONS AND 
PENALTIES TO BUSINESS ASSOCIATES OF 
COVERED ENTITIES; ANNUAL GUIDANCE ON 
SECURITY PROVISIONS. 
(a) APPLICATION OF SECURITY PROVISIONS.—Sec-
tions 164.308, 164.310, 164.312, and 164.316 of title 45, 
Code of Federal Regulations, shall apply to a business as-
sociate of a covered entity in the same manner that such 
sections apply to the covered entity. The additional re-
quirements of this title that relate to security and that 
are made applicable with respect to covered entities shall 
also be applicable to such a business associate and shall 
be incorporated into the business associate agreement be-
tween the business associate and the covered entity. 
(b) APPLICATION
OF CIVIL
AND CRIMINAL PEN-
ALTIES.—In the case of a business associate that violates 
any security provision specified in subsection (a), sections 
1176 and 1177 of the Social Security Act (42 U.S.C. 
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1320d–5, 1320d–6) shall apply to the business associate 
with respect to such violation in the same manner such 
sections apply to a covered entity that violates such secu-
rity provision. 
(c) ANNUAL GUIDANCE.—For the first year begin-
ning after the date of the enactment of this Act and annu-
ally thereafter, the Secretary of Health and Human Serv-
ices shall, in consultation with industry stakeholders, an-
nually issue guidance on the most effective and appro-
priate technical safeguards for use in carrying out the sec-
tions referred to in subsection (a) and the security stand-
ards in subpart C of part 164 of title 45, Code of Federal 
Regulations, as such provisions are in effect as of the date 
before the enactment of this Act. 
SEC. 4402. NOTIFICATION IN THE CASE OF BREACH. 
(a) IN GENERAL.—A covered entity that accesses, 
maintains, retains, modifies, records, stores, destroys, or 
otherwise holds, uses, or discloses unsecured protected 
health information (as defined in subsection (h)(1)) shall, 
in the case of a breach of such information that is discov-
ered by the covered entity, notify each individual whose 
unsecured protected health information has been, or is 
reasonably believed by the covered entity to have been, 
accessed, acquired, or disclosed as a result of such breach. 
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(b) NOTIFICATION OF COVERED ENTITY BY BUSI-
NESS ASSOCIATE.—A business associate of a covered enti-
ty that accesses, maintains, retains, modifies, records, 
stores, destroys, or otherwise holds, uses, or discloses un-
secured protected health information shall, following the 
discovery of a breach of such information, notify the cov-
ered entity of such breach. Such notice shall include the 
identification of each individual whose unsecured protected 
health information has been, or is reasonably believed by 
the business associate to have been, accessed, acquired, 
or disclosed during such breach. 
(c) BREACHES TREATED AS DISCOVERED.—For pur-
poses of this section, a breach shall be treated as discov-
ered by a covered entity or by a business associate as of 
the first day on which such breach is known to such entity 
or associate, respectively (including any person, other than 
the individual committing the breach, that is an employee, 
officer, or other agent of such entity or associate, respec-
tively), or should reasonably have been known to such enti-
ty or associate (or person) to have occurred. 
(d) TIMELINESS OF NOTIFICATION.— 
(1) IN GENERAL.—Subject to subsection (g), all 
notifications required under this section shall be 
made without unreasonable delay and in no case 
later than 60 calendar days after the discovery of a 
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breach by the covered entity involved (or business 
associate involved in the case of a notification re-
quired under subsection (b)). 
(2) BURDEN OF PROOF.—The covered entity in-
volved (or business associate involved in the case of 
a notification required under subsection (b)), shall 
have the burden of demonstrating that all notifica-
tions were made as required under this part, includ-
ing evidence demonstrating the necessity of any 
delay. 
(e) METHODS OF NOTICE.— 
(1) 
INDIVIDUAL
NOTICE.—Notice 
required 
under this section to be provided to an individual, 
with respect to a breach, shall be provided promptly 
and in the following form: 
(A) Written notification by first-class mail 
to the individual (or the next of kin of the indi-
vidual if the individual is deceased) at the last 
known address of the individual or the next of 
kin, respectively, or, if specified as a preference 
by the individual, by electronic mail. The notifi-
cation may be provided in one or more mailings 
as information is available. 
(B) In the case in which there is insuffi-
cient, or out-of-date contact information (in-
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cluding a phone number, email address, or any 
other form of appropriate communication) that 
precludes direct written (or, if specified by the 
individual under subparagraph (A), electronic) 
notification to the individual, a substitute form 
of notice shall be provided, including, in the 
case that there are 10 or more individuals for 
which there is insufficient or out-of-date contact 
information, a conspicuous posting for a period 
determined by the Secretary on the home page 
of the website of the covered entity involved or 
notice in major print or broadcast media, in-
cluding major media in geographic areas where 
the individuals affected by the breach likely re-
side. Such a notice in media or web posting will 
include a toll-free phone number where an indi-
vidual can learn whether or not the individual’s 
unsecured protected health information is pos-
sibly included in the breach. 
(C) In any case deemed by the covered en-
tity involved to require urgency because of pos-
sible imminent misuse of unsecured protected 
health information, the covered entity, in addi-
tion to notice provided under subparagraph (A), 
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may provide information to individuals by tele-
phone or other means, as appropriate. 
(2) MEDIA NOTICE.—Notice shall be provided 
to prominent media outlets serving a State or juris-
diction, following the discovery of a breach described 
in subsection (a), if the unsecured protected health 
information of more than 500 residents of such 
State or jurisdiction is, or is reasonably believed to 
have been, accessed, acquired, or disclosed during 
such breach. 
(3) NOTICE TO SECRETARY.—Notice shall be 
provided to the Secretary by covered entities of un-
secured protected health information that has been 
acquired or disclosed in a breach. If the breach was 
with respect to 500 or more individuals than such 
notice must be provided immediately. If the breach 
was with respect to less than 500 individuals, the 
covered entity involved may maintain a log of any 
such breach occurring and annually submit such a 
log to the Secretary documenting such breaches oc-
curring during the year involved. 
(4) POSTING ON HHS PUBLIC WEBSITE.—The 
Secretary shall make available to the public on the 
Internet website of the Department of Health and 
Human Services a list that identifies each covered 
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entity involved in a breach described in subsection 
(a) in which the unsecured protected health informa-
tion of more than 500 individuals is acquired or dis-
closed. 
(f) CONTENT OF NOTIFICATION.—Regardless of the 
method by which notice is provided to individuals under 
this section, notice of a breach shall include, to the extent 
possible, the following: 
(1) A brief description of what happened, in-
cluding the date of the breach and the date of the 
discovery of the breach, if known. 
(2) A description of the types of unsecured pro-
tected health information that were involved in the 
breach (such as full name, Social Security number, 
date of birth, home address, account number, or dis-
ability code). 
(3) The steps individuals should take to protect 
themselves from potential harm resulting from the 
breach. 
(4) A brief description of what the covered enti-
ty involved is doing to investigate the breach, to 
mitigate losses, and to protect against any further 
breaches. 
(5) Contact procedures for individuals to ask 
questions or learn additional information, which 
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shall include a toll-free telephone number, an e-mail 
address, website, or postal address. 
(g) DELAY OF NOTIFICATION AUTHORIZED FOR LAW 
ENFORCEMENT PURPOSES.—If a law enforcement official 
determines that a notification, notice, or posting required 
under this section would impede a criminal investigation 
or cause damage to national security, such notification, 
notice, or posting shall be delayed in the same manner 
as provided under section 164.528(a)(2) of title 45, Code 
of Federal Regulations, in the case of a disclosure covered 
under such section. 
(h) UNSECURED PROTECTED HEALTH INFORMA-
TION.— 
(1) DEFINITION.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), for purposes of this section, the 
term ‘‘unsecured protected health information’’ 
means protected health information that is not 
secured through the use of a technology or 
methodology specified by the Secretary in the 
guidance issued under paragraph (2). 
(B) EXCEPTION
IN
CASE
TIMELY
GUID-
ANCE NOT ISSUED.—In the case that the Sec-
retary does not issue guidance under paragraph 
(2) by the date specified in such paragraph, for 
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purposes of this section, the term ‘‘unsecured 
protected health information’’ shall mean pro-
tected health information that is not secured by 
a technology standard that renders protected 
health information unusable, unreadable, or in-
decipherable to unauthorized individuals and is 
developed or endorsed by a standards devel-
oping organization that is accredited by the 
American National Standards Institute. 
(2) GUIDANCE.—For purposes of paragraph (1) 
and section 407(f)(3), not later than the date that 
is 60 days after the date of the enactment of this 
Act, the Secretary shall, after consultation with 
stakeholders, issue (and annually update) guidance 
specifying the technologies and methodologies that 
render 
protected 
health 
information 
unusable, 
unreadable, or indecipherable to unauthorized indi-
viduals. 
(i) REPORT TO CONGRESS ON BREACHES.— 
(1) IN GENERAL.—Not later than 12 months 
after the date of the enactment of this Act and an-
nually thereafter, the Secretary shall prepare and 
submit to the Committee on Finance and the Com-
mittee on Health, Education, Labor, and Pensions 
of the Senate and the Committee on Ways and 
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Means and the Committee on Energy and Commerce 
of the House of Representatives a report containing 
the information described in paragraph (2) regard-
ing breaches for which notice was provided to the 
Secretary under subsection (e)(3). 
(2) INFORMATION.—The information described 
in this paragraph regarding breaches specified in 
paragraph (1) shall include— 
(A) the number and nature of such 
breaches; and 
(B) actions taken in response to such 
breaches. 
(j) REGULATIONS; EFFECTIVE DATE.—To carry out 
this section, the Secretary of Health and Human Services 
shall promulgate interim final regulations by not later 
than the date that is 180 days after the date of the enact-
ment of this title. The provisions of this section shall apply 
to breaches that are discovered on or after the date that 
is 30 days after the date of publication of such interim 
final regulations. 
SEC. 4403. EDUCATION ON HEALTH INFORMATION PRI-
VACY. 
(a) REGIONAL OFFICE PRIVACY ADVISORS.—Not 
later than 6 months after the date of the enactment of 
this Act, the Secretary shall designate an individual in 
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each regional office of the Department of Health and 
Human Services to offer guidance and education to cov-
ered entities, business associates, and individuals on their 
rights and responsibilities related to Federal privacy and 
security requirements for protected health information. 
(b) EDUCATION INITIATIVE ON USES OF HEALTH IN-
FORMATION.—Not later than 12 months after the date of 
the enactment of this Act, the Office for Civil Rights with-
in the Department of Health and Human Services shall 
develop and maintain a multi-faceted national education 
initiative to enhance public transparency regarding the 
uses of protected health information, including programs 
to educate individuals about the potential uses of their 
protected health information, the effects of such uses, and 
the rights of individuals with respect to such uses. Such 
programs shall be conducted in a variety of languages and 
present information in a clear and understandable man-
ner. 
SEC. 4404. APPLICATION OF PRIVACY PROVISIONS AND 
PENALTIES TO BUSINESS ASSOCIATES OF 
COVERED ENTITIES. 
(a) APPLICATION OF CONTRACT REQUIREMENTS.— 
In the case of a business associate of a covered entity that 
obtains or creates protected health information pursuant 
to a written contract (or other written arrangement) de-
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scribed in section 164.502(e)(2) of title 45, Code of Fed-
eral Regulations, with such covered entity, the business 
associate may use and disclose such protected health infor-
mation only if such use or disclosure, respectively, is in 
compliance with each applicable requirement of section 
164.504(e) of such title. The additional requirements of 
this subtitle that relate to privacy and that are made ap-
plicable with respect to covered entities shall also be appli-
cable to such a business associate and shall be incor-
porated into the business associate agreement between the 
business associate and the covered entity. 
(b) APPLICATION OF KNOWLEDGE ELEMENTS ASSO-
CIATED WITH CONTRACTS.—Section 164.504(e)(1)(ii) of 
title 45, Code of Federal Regulations, shall apply to a 
business associate described in subsection (a), with respect 
to compliance with such subsection, in the same manner 
that such section applies to a covered entity, with respect 
to compliance with the standards in sections 164.502(e) 
and 164.504(e) of such title, except that in applying such 
section 164.504(e)(1)(ii) each reference to the business as-
sociate, with respect to a contract, shall be treated as a 
reference to the covered entity involved in such contract. 
(c) APPLICATION
OF CIVIL
AND CRIMINAL PEN-
ALTIES.—In the case of a business associate that violates 
any provision of subsection (a) or (b), the provisions of 
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sections 1176 and 1177 of the Social Security Act (42 
U.S.C. 1320d–5, 1320d–6) shall apply to the business as-
sociate with respect to such violation in the same manner 
as such provisions apply to a person who violates a provi-
sion of part C of title XI of such Act. 
SEC. 4405. RESTRICTIONS ON CERTAIN DISCLOSURES AND 
SALES OF HEALTH INFORMATION; ACCOUNT-
ING OF CERTAIN PROTECTED HEALTH IN-
FORMATION DISCLOSURES; ACCESS TO CER-
TAIN INFORMATION IN ELECTRONIC FOR-
MAT. 
(a) REQUESTED RESTRICTIONS ON CERTAIN DIS-
CLOSURES OF HEALTH INFORMATION.—In the case that 
an individual requests under paragraph (a)(1)(i)(A) of 
section 164.522 of title 45, Code of Federal Regulations, 
that a covered entity restrict the disclosure of the pro-
tected health information of the individual, notwith-
standing paragraph (a)(1)(ii) of such section, the covered 
entity must comply with the requested restriction if— 
(1) except as otherwise required by law, the dis-
closure is to a health plan for purposes of carrying 
out payment or health care operations (and is not 
for purposes of carrying out treatment); and 
(2) the protected health information pertains 
solely to a health care item or service for which the 
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health care provider involved has been paid out of 
pocket in full. 
(b) DISCLOSURES REQUIRED TO BE LIMITED TO 
THE
LIMITED
DATA
SET
OR
THE
MINIMUM
NEC-
ESSARY.— 
(1) IN GENERAL.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), a covered entity shall be treated as 
being in compliance with section 164.502(b)(1) 
of title 45, Code of Federal Regulations, with 
respect to the use, disclosure, or request of pro-
tected health information described in such sec-
tion, only if the covered entity limits such pro-
tected health information, to the extent prac-
ticable, to the limited data set (as defined in 
section 164.514(e)(2) of such title) or, if needed 
by such entity, to the minimum necessary to ac-
complish the intended purpose of such use, dis-
closure, or request, respectively. 
(B) 
GUIDANCE.—Not 
later 
than 
months after the date of the enactment of this 
section, the Secretary shall issue guidance on 
what constitutes ‘‘minimum necessary’’ for pur-
poses of subpart E of part 164 of title 45, Code 
of Federal Regulation. In issuing such guidance 
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the Secretary shall take into consideration the 
guidance under section 4424(c). 
(C) SUNSET.—Subparagraph (A) shall not 
apply on and after the effective date on which 
the Secretary issues the guidance under sub-
paragraph (B). 
(2) 
DETERMINATION
OF
MINIMUM
NEC-
ESSARY.—For purposes of paragraph (1), in the 
case of the disclosure of protected health informa-
tion, the covered entity or business associate dis-
closing such information shall determine what con-
stitutes the minimum necessary to accomplish the 
intended purpose of such disclosure. 
(3) APPLICATION OF EXCEPTIONS.—The excep-
tions described in section 164.502(b)(2) of title 45, 
Code of Federal Regulations, shall apply to the re-
quirement under paragraph (1) as of the effective 
date described in section 4423 in the same manner 
that such exceptions apply to section 164.502(b)(1) 
of such title before such date. 
(4) RULE OF CONSTRUCTION.—Nothing in this 
subsection shall be construed as affecting the use, 
disclosure, or request of protected health information 
that has been de-identified. 
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(c) ACCOUNTING OF CERTAIN PROTECTED HEALTH 
INFORMATION DISCLOSURES REQUIRED IF COVERED EN-
TITY USES ELECTRONIC HEALTH RECORD.— 
(1) IN GENERAL.—In applying section 164.528 
of title 45, Code of Federal Regulations, in the case 
that a covered entity uses or maintains an electronic 
health record with respect to protected health infor-
mation— 
(A) 
the 
exception 
under 
paragraph 
(a)(1)(i) of such section shall not apply to dis-
closures through an electronic health record 
made by such entity of such information; and 
(B) an individual shall have a right to re-
ceive an accounting of disclosures described in 
such paragraph of such information made by 
such covered entity during only the three years 
prior to the date on which the accounting is re-
quested. 
(2) REGULATIONS.—The Secretary shall pro-
mulgate regulations on what information shall be 
collected about each disclosure referred to in para-
graph (1)(A) not later than 18 months after the 
date on which the Secretary adopts standards on ac-
counting for disclosure described in the section 
3002(b)(2)(B)(iv) of the Public Health Service Act, 
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as added by section 4101. Such regulations shall 
only require such information to be collected through 
an electronic health record in a manner that takes 
into account the interests of individuals in learning 
the circumstances under which their protected health 
information is being disclosed and takes into account 
the administrative burden of accounting for such 
disclosures. 
(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as requiring a covered en-
tity to account for disclosures of protected health in-
formation that are not made by such covered entity 
or by a business associate acting on behalf of the 
covered entity. 
(4) EFFECTIVE DATE.— 
(A) CURRENT
USERS
OF
ELECTRONIC 
RECORDS.—In the case of a covered entity inso-
far as it acquired an electronic health record as 
of January 1, 2009, paragraph (1) shall apply 
to disclosures, with respect to protected health 
information, made by the covered entity from 
such a record on and after January 1, 2014. 
(B) OTHERS.—In the case of a covered en-
tity insofar as it acquires an electronic health 
record after January 1, 2009, paragraph (1) 
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shall apply to disclosures, with respect to pro-
tected health information, made by the covered 
entity from such record on and after the later 
of the following: 
(i) January 1, 2011; or 
(ii) the date that it acquires an elec-
tronic health record. 
(d) REVIEW OF HEALTH CARE OPERATIONS.—Not 
later than 18 months after the date of the enactment of 
this title, the Secretary shall promulgate regulations to 
eliminate from the definition of health care operations 
under section 164.501 of title 45, Code of Federal Regula-
tions, those activities that can reasonably and efficiently 
be conducted through the use of information that is de- 
identified (in accordance with the requirements of section 
164.514(b) of such title) or that should require a valid 
authorization for use or disclosure. In promulgating such 
regulations, the Secretary may choose to narrow or clarify 
activities that the Secretary chooses to retain in the defini-
tion of health care operations and the Secretary shall take 
into account the report under section 424(d). In such reg-
ulations the Secretary shall specify the date on which such 
regulations shall apply to disclosures made by a covered 
entity, but in no case would such date be sooner than the 
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date that is 24 months after the date of the enactment 
of this section. 
(e) PROHIBITION ON SALE OF ELECTRONIC HEALTH 
RECORDS OR PROTECTED HEALTH INFORMATION.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), a covered entity or business associate 
shall not directly or indirectly receive remuneration 
in exchange for any protected health information of 
an individual unless the covered entity obtained from 
the individual, in accordance with section 164.508 of 
title 45, Code of Federal Regulations, a valid au-
thorization that includes, in accordance with such 
section, a specification of whether the protected 
health information can be further exchanged for re-
muneration by the entity receiving protected health 
information of that individual. 
(2) EXCEPTIONS.—Paragraph (1) shall not 
apply in the following cases: 
(A) The purpose of the exchange is for re-
search or public health activities (as described 
in sections 164.501, 164.512(i), and 164.512(b) 
of title 45, Code of Federal Regulations) and 
the price charged reflects the costs of prepara-
tion and transmittal of the data for such pur-
pose. 
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(B) The purpose of the exchange is for the 
treatment of the individual and the price 
charges reflects not more than the costs of 
preparation and transmittal of the data for 
such purpose. 
(C) The purpose of the exchange is the 
health care operation specifically described in 
subparagraph (iv) of paragraph (6) of the defi-
nition of health care operations in section 
164.501 of title 45, Code of Federal Regula-
tions. 
(D) The purpose of the exchange is for re-
muneration that is provided by a covered entity 
to a business associate for activities involving 
the exchange of protected health information 
that the business associate undertakes on behalf 
of and at the specific request of the covered en-
tity pursuant to a business associate agreement. 
(E) The purpose of the exchange is to pro-
vide an individual with a copy of the individ-
ual’s protected health information pursuant to 
section 164.524 of title 45, Code of Federal 
Regulations. 
(F) The purpose of the exchange is other-
wise determined by the Secretary in regulations 
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210 
to be similarly necessary and appropriate as the 
exceptions provided in subparagraphs (A) 
through (E). 
(3) REGULATIONS.—The Secretary shall pro-
mulgate regulations to carry out paragraph (this 
subsection, including exceptions described in para-
graph (2), not later than 18 months after the date 
of the enactment of this title. 
(4) EFFECTIVE
DATE.—Paragraph (1) shall 
apply to exchanges occurring on or after the date 
that is 6 months after the date of the promulgation 
of final regulations implementing this subsection. 
(f) ACCESS TO CERTAIN INFORMATION IN ELEC-
TRONIC FORMAT.—In applying section 164.524 of title 
45, Code of Federal Regulations, in the case that a cov-
ered entity uses or maintains an electronic health record 
with respect to protected health information of an indi-
vidual— 
(1) the individual shall have a right to obtain 
from such covered entity a copy of such information 
in an electronic format; and 
(2) notwithstanding paragraph (c)(4) of such 
section, any fee that the covered entity may impose 
for providing such individual with a copy of such in-
formation (or a summary or explanation of such in-
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211 
formation) if such copy (or summary or explanation) 
is in an electronic form shall not be greater than the 
entity’s labor costs in responding to the request for 
the copy (or summary or explanation). 
SEC. 4406. CONDITIONS ON CERTAIN CONTACTS AS PART 
OF HEALTH CARE OPERATIONS. 
(a) MARKETING.— 
(1) IN GENERAL.—A communication by a cov-
ered entity or business associate that is about a 
product or service and that encourages recipients of 
the communication to purchase or use the product 
or service shall not be considered a health care oper-
ation for purposes of subpart E of part 164 of title 
45, Code of Federal Regulations, unless the commu-
nication is made as described in subparagraph (i), 
(ii), or (iii) of paragraph (1) of the definition of 
marketing in section 164.501 of such title. 
(2) 
PAYMENT
FOR
CERTAIN
COMMUNICA-
TIONS.—A covered entity or business associate may 
not receive direct or indirect payment in exchange 
for making any communication described in sub-
paragraph (i), (ii), or (iii) of paragraph (1) of the 
definition of marketing in section 164.501 of title 
45, Code of Federal Regulations, except— 
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212 
(A) a business associate of a covered entity 
may receive payment from the covered entity 
for making any such communication on behalf 
of the covered entity that is consistent with the 
written contract (or other written arrangement) 
described in section 164.502(e)(2) of such title 
between such business associate and covered en-
tity; or 
(B) a covered entity may receive payment 
in exchange for making any such communica-
tion if the entity obtains from the recipient of 
the communication, in accordance with section 
164.508 of title 45, Code of Federal Regula-
tions, a valid authorization (as described in 
paragraph (b) of such section) with respect to 
such communication. 
(b) FUNDRAISING.—Fundraising for the benefit of a 
covered entity shall not be considered a health care oper-
ation for purposes of section 164.501 of title 45, Code of 
Federal Regulations. 
(c) EFFECTIVE DATE.—This section shall apply to 
contracting occurring on or after the effective date speci-
fied under section 4423. 
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213 
SEC. 4407. TEMPORARY BREACH NOTIFICATION REQUIRE-
MENT FOR VENDORS OF PERSONAL HEALTH 
RECORDS AND OTHER NON-HIPAA COVERED 
ENTITIES. 
(a) IN GENERAL.—In accordance with subsection (c), 
each vendor of personal health records, following the dis-
covery of a breach of security of unsecured PHR identifi-
able health information that is in a personal health record 
maintained or offered by such vendor, and each entity de-
scribed in clause (ii) or (iii) of section 4424(b)(1)(A), fol-
lowing the discovery of a breach of security of such infor-
mation that is obtained through a product or service pro-
vided by such entity, shall— 
(1) notify each individual who is a citizen or 
resident of the United States whose unsecured PHR 
identifiable health information was acquired by an 
unauthorized person as a result of such a breach of 
security; and 
(2) notify the Federal Trade Commission. 
(b) NOTIFICATION BY THIRD PARTY SERVICE PRO-
VIDERS.—A third party service provider that provides 
services to a vendor of personal health records or to an 
entity described in clause (ii) or (iii) of section 
4424(b)(1)(A) in connection with the offering or mainte-
nance of a personal health record or a related product or 
service and that accesses, maintains, retains, modifies, 
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214 
records, stores, destroys, or otherwise holds, uses, or dis-
closes unsecured PHR identifiable health information in 
such a record as a result of such services shall, following 
the discovery of a breach of security of such information, 
notify such vendor or entity, respectively, of such breach. 
Such notice shall include the identification of each indi-
vidual whose unsecured PHR identifiable health informa-
tion has been, or is reasonably believed to have been, 
accessed, acquired, or disclosed during such breach. 
(c) APPLICATION OF REQUIREMENTS FOR TIMELI-
NESS, METHOD, AND CONTENT
OF NOTIFICATIONS.— 
Subsections (c), (d), (e), and (f) of section 402 shall apply 
to a notification required under subsection (a) and a ven-
dor of personal health records, an entity described in sub-
section (a) and a third party service provider described 
in subsection (b), with respect to a breach of security 
under subsection (a) of unsecured PHR identifiable health 
information in such records maintained or offered by such 
vendor, in a manner specified by the Federal Trade Com-
mission. 
(d) NOTIFICATION OF THE SECRETARY.—Upon re-
ceipt of a notification of a breach of security under sub-
section (a)(2), the Federal Trade Commission shall notify 
the Secretary of such breach. 
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215 
(e) ENFORCEMENT.—A violation of subsection (a) or 
(b) shall be treated as an unfair and deceptive act or prac-
tice in violation of a regulation under section 18(a)(1)(B) 
of the Federal Trade Commission Act (15 U.S.C. 
57a(a)(1)(B)) regarding unfair or deceptive acts or prac-
tices. 
(f) DEFINITIONS.—For purposes of this section: 
(1) BREACH OF SECURITY.—The term ‘‘breach 
of security’’ means, with respect to unsecured PHR 
identifiable health information of an individual in a 
personal health record, acquisition of such informa-
tion without the authorization of the individual. 
(2) PHR IDENTIFIABLE
HEALTH
INFORMA-
TION.—The term ‘‘PHR identifiable health informa-
tion’’ means individually identifiable health informa-
tion, as defined in section 1171(6) of the Social Se-
curity Act (42 U.S.C. 1320d(6)), and includes, with 
respect to an individual, information— 
(A) that is provided by or on behalf of the 
individual; and 
(B) that identifies the individual or with 
respect to which there is a reasonable basis to 
believe that the information can be used to 
identify the individual. 
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216 
(3) UNSECURED
PHR
IDENTIFIABLE
HEALTH 
INFORMATION.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), the term ‘‘unsecured PHR identifi-
able health information’’ means PHR identifi-
able health information that is not protected 
through the use of a technology or methodology 
specified by the Secretary in the guidance 
issued under section 4402(h)(2). 
(B) EXCEPTION
IN
CASE
TIMELY
GUID-
ANCE NOT ISSUED.—In the case that the Sec-
retary does not issue guidance under section 
4402(h)(2) by the date specified in such sec-
tion, for purposes of this section, the term ‘‘un-
secured PHR identifiable health information’’ 
shall mean PHR identifiable health information 
that is not secured by a technology standard 
that renders protected health information unus-
able, unreadable, or indecipherable to unauthor-
ized individuals and that is developed or en-
dorsed by a standards developing organization 
that is accredited by the American National 
Standards Institute. 
(g) REGULATIONS; EFFECTIVE DATE; SUNSET.— 
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218 
SEC. 4408. BUSINESS ASSOCIATE CONTRACTS REQUIRED 
FOR CERTAIN ENTITIES. 
Each organization, with respect to a covered entity, 
that provides data transmission of protected health infor-
mation to such entity (or its business associate) and that 
requires access on a routine basis to such protected health 
information, such as a Health Information Exchange Or-
ganization, Regional Health Information Organization, E- 
prescribing Gateway, or each vendor that contracts with 
a covered entity to allow that covered entity to offer a per-
sonal health record to patients as part of its electronic 
health record, is required to enter into a written contract 
(or other written arrangement) described in section 
164.502(e)(2) of title 45, Code of Federal Regulations and 
a written contract (or other arrangement) described in 
section 164.308(b) of such title, with such entity and shall 
be treated as a business associate of the covered entity 
for purposes of the provisions of this subtitle and subparts 
C and E of part 164 of title 45, Code of Federal Regula-
tions, as such provisions are in effect as of the date of 
enactment of this title. 
SEC. 4409. CLARIFICATION OF APPLICATION OF WRONGFUL 
DISCLOSURES CRIMINAL PENALTIES. 
Section 1177(a) of the Social Security Act (42 U.S.C. 
1320d–6(a)) is amended by adding at the end the fol-
lowing new sentence: ‘‘For purposes of the previous sen-
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219 
tence, a person (including an employee or other individual) 
shall be considered to have obtained or disclosed individ-
ually identifiable health information in violation of this 
part if the information is maintained by a covered entity 
(as defined in the HIPAA privacy regulation described in 
section 1180(b)(3)) and the individual obtained or dis-
closed such information without authorization.’’. 
SEC. 4410. IMPROVED ENFORCEMENT. 
(a) IN GENERAL.—Section 1176 of the Social Secu-
rity Act (42 U.S.C. 1320d–5) is amended— 
(1) in subsection (b)(1), by striking ‘‘the act 
constitutes an offense punishable under section 
1177’’ and inserting ‘‘a penalty has been imposed 
under section 1177 with respect to such act’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(c) NONCOMPLIANCE
DUE
TO
WILLFUL
NE-
GLECT.— 
‘‘(1) IN GENERAL.—A violation of a provision 
of this part due to willful neglect is a violation for 
which the Secretary is required to impose a penalty 
under subsection (a)(1). 
‘‘(2) REQUIRED INVESTIGATION.—For purposes 
of paragraph (1), the Secretary shall formally inves-
tigate any complaint of a violation of a provision of 
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220 
this part if a preliminary investigation of the facts 
of the complaint indicate such a possible violation 
due to willful neglect.’’. 
(b) EFFECTIVE DATE; REGULATIONS.— 
(1) The amendments made by subsection (a) 
shall apply to penalties imposed on or after the date 
that is 24 months after the date of the enactment 
of this title. 
(2) Not later than 18 months after the date of 
the enactment of this title, the Secretary of Health 
and Human Services shall promulgate regulations to 
implement such amendments. 
(c) DISTRIBUTION OF CERTAIN CIVIL MONETARY 
PENALTIES COLLECTED.— 
(1) IN
GENERAL.—Subject to the regulation 
promulgated pursuant to paragraph (3), any civil 
monetary penalty or monetary settlement collected 
with respect to an offense punishable under this sub-
title or section 1176 of the Social Security Act (42 
U.S.C. 1320d–5) insofar as such section relates to 
privacy or security shall be transferred to the Office 
of Civil Rights of the Department of Health and 
Human Services to be used for purposes of enforcing 
the provisions of this subtitle and subparts C and E 
of part 164 of title 45, Code of Federal Regulations, 
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221 
as such provisions are in effect as of the date of en-
actment of this Act. 
(2) GAO REPORT.—Not later than 18 months 
after the date of the enactment of this title, the 
Comptroller General shall submit to the Secretary a 
report including recommendations for a methodology 
under which an individual who is harmed by an act 
that constitutes an offense referred to in paragraph 
(1) may receive a percentage of any civil monetary 
penalty or monetary settlement collected with re-
spect to such offense. 
(3) ESTABLISHMENT
OF
METHODOLOGY
TO 
DISTRIBUTE PERCENTAGE OF CMPS COLLECTED TO 
HARMED
INDIVIDUALS.—Not later than 3 years 
after the date of the enactment of this title, the Sec-
retary shall establish by regulation and based on the 
recommendations submitted under paragraph (2), a 
methodology under which an individual who is 
harmed by an act that constitutes an offense re-
ferred to in paragraph (1) may receive a percentage 
of any civil monetary penalty or monetary settlement 
collected with respect to such offense. 
(4) APPLICATION
OF
METHODOLOGY.—The 
methodology under paragraph (3) shall be applied 
with respect to civil monetary penalties or monetary 
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222 
settlements imposed on or after the effective date of 
the regulation. 
(d) TIERED INCREASE IN AMOUNT OF CIVIL MONE-
TARY PENALTIES.— 
(1) IN GENERAL.—Section 1176(a)(1) of the 
Social Security Act (42 U.S.C. 1320d–5(a)(1)) is 
amended by striking ‘‘who violates a provision of 
this part a penalty of not more than’’ and all that 
follows and inserting the following: ‘‘who violates a 
provision of this part— 
‘‘(A) in the case of a violation of such pro-
vision in which it is established that the person 
did not know (and by exercising reasonable dili-
gence would not have known) that such person 
violated such provision, a penalty for each such 
violation of an amount that is at least the 
amount described in paragraph (3)(A) but not 
to exceed the amount described in paragraph 
(3)(D); 
‘‘(B) in the case of a violation of such pro-
vision in which it is established that the viola-
tion was due to reasonable cause and not to 
willful neglect, a penalty for each such violation 
of an amount that is at least the amount de-
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223 
scribed in paragraph (3)(B) but not to exceed 
the amount described in paragraph (3)(D); and 
‘‘(C) in the case of a violation of such pro-
vision in which it is established that the viola-
tion was due to willful neglect— 
‘‘(i) if the violation is corrected as de-
scribed in subsection (b)(3)(A), a penalty 
in an amount that is at least the amount 
described in paragraph (3)(C) but not to 
exceed the amount described in paragraph 
(3)(D); and 
‘‘(ii) if the violation is not corrected 
as described in such subsection, a penalty 
in an amount that is at least the amount 
described in paragraph (3)(D). 
In determining the amount of a penalty under 
this section for a violation, the Secretary shall 
base such determination on the nature and ex-
tent of the violation and the nature and extent 
of the harm resulting from such violation.’’. 
(2) TIERS OF PENALTIES DESCRIBED.—Section 
1176(a) of such Act (42 U.S.C. 1320d–5(a)) is fur-
ther amended by adding at the end the following 
new paragraph: 
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224 
‘‘(3) TIERS
OF
PENALTIES
DESCRIBED.—For 
purposes of paragraph (1), with respect to a viola-
tion by a person of a provision of this part— 
‘‘(A) the amount described in this subpara-
graph is $100 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
ment or prohibition during a calendar year may 
not exceed $25,000; 
‘‘(B) the amount described in this subpara-
graph is $1,000 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
ment or prohibition during a calendar year may 
not exceed $100,000; 
‘‘(C) the amount described in this subpara-
graph is $10,000 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
ment or prohibition during a calendar year may 
not exceed $250,000; and 
‘‘(D) the amount described in this sub-
paragraph is $50,000 for each such violation, 
except that the total amount imposed on the 
person for all such violations of an identical re-
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225 
quirement or prohibition during a calendar year 
may not exceed $1,500,000.’’. 
(3) 
CONFORMING
AMENDMENTS.—Section 
1176(b) of such Act (42 U.S.C. 1320d–5(b)) is 
amended— 
(A) by striking paragraph (2) and redesig-
nating paragraphs (3) and (4) as paragraphs 
(2) and (3), respectively; and 
(B) in paragraph (2), as so redesignated— 
(i) in subparagraph (A), by striking 
‘‘in subparagraph (B), a penalty may not 
be imposed under subsection (a) if’’ and all 
that follows through ‘‘the failure to comply 
is corrected’’ and inserting ‘‘in subpara-
graph (B) or subsection (a)(1)(C), a pen-
alty may not be imposed under subsection 
(a) if the failure to comply is corrected’’; 
and 
(ii) in subparagraph (B), by striking 
‘‘(A)(ii)’’ and inserting ‘‘(A)’’ each place it 
appears. 
(4) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to violations occurring 
after the date of the enactment of this title. 
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226 
(e) ENFORCEMENT THROUGH STATE ATTORNEYS 
GENERAL.— 
(1) IN GENERAL.—Section 1176 of the Social 
Security Act (42 U.S.C. 1320d–5) is amended by 
adding at the end the following new subsection: 
‘‘(c) ENFORCEMENT BY STATE ATTORNEYS GEN-
ERAL.— 
‘‘(1) CIVIL
ACTION.—Except as provided in 
subsection (b), in any case in which the attorney 
general of a State has reason to believe that an in-
terest of one or more of the residents of that State 
has been or is threatened or adversely affected by 
any person who violates a provision of this part, the 
attorney general of the State, as parens patriae, may 
bring a civil action on behalf of such residents of the 
State in a district court of the United States of ap-
propriate jurisdiction— 
‘‘(A) to enjoin further such violation by the 
defendant; or 
‘‘(B) to obtain damages on behalf of such 
residents of the State, in an amount equal to 
the amount determined under paragraph (2). 
‘‘(2) STATUTORY DAMAGES.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1)(B), the amount determined under 
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this paragraph is the amount calculated by mul-
tiplying the number of violations by up to $100. 
For purposes of the preceding sentence, in the 
case of a continuing violation, the number of 
violations shall be determined consistent with 
the HIPAA privacy regulations (as defined in 
section 1180(b)(3)) for violations of subsection 
(a). 
‘‘(B) LIMITATION.—The total amount of 
damages imposed on the person for all viola-
tions of an identical requirement or prohibition 
during a calendar year may not exceed $25,000. 
‘‘(C) REDUCTION
OF
DAMAGES.—In as-
sessing damages under subparagraph (A), the 
court may consider the factors the Secretary 
may consider in determining the amount of a 
civil money penalty under subsection (a) under 
the HIPAA privacy regulations. 
‘‘(3) ATTORNEY FEES.—In the case of any suc-
cessful action under paragraph (1), the court, in its 
discretion, may award the costs of the action and 
reasonable attorney fees to the State. 
‘‘(4) NOTICE TO SECRETARY.—The State shall 
serve prior written notice of any action under para-
graph (1) upon the Secretary and provide the Sec-
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228 
retary with a copy of its complaint, except in any 
case in which such prior notice is not feasible, in 
which case the State shall serve such notice imme-
diately upon instituting such action. The Secretary 
shall have the right— 
‘‘(A) to intervene in the action; 
‘‘(B) upon so intervening, to be heard on 
all matters arising therein; and 
‘‘(C) to file petitions for appeal. 
‘‘(5) CONSTRUCTION.—For purposes of bring-
ing any civil action under paragraph (1), nothing in 
this section shall be construed to prevent an attor-
ney general of a State from exercising the powers 
conferred on the attorney general by the laws of that 
State. 
‘‘(6) VENUE; SERVICE OF PROCESS.— 
‘‘(A) VENUE.—Any action brought under 
paragraph (1) may be brought in the district 
court of the United States that meets applicable 
requirements relating to venue under section 
1391 of title 28, United States Code. 
‘‘(B) SERVICE OF PROCESS.—In an action 
brought under paragraph (1), process may be 
served in any district in which the defendant— 
‘‘(i) is an inhabitant; or 
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229 
‘‘(ii) maintains a physical place of 
business. 
‘‘(7) LIMITATION
ON
STATE
ACTION
WHILE 
FEDERAL ACTION IS PENDING.—If the Secretary has 
instituted an action against a person under sub-
section (a) with respect to a specific violation of this 
part, no State attorney general may bring an action 
under this subsection against the person with re-
spect to such violation during the pendency of that 
action. 
‘‘(8) APPLICATION OF CMP STATUTE OF LIMI-
TATION.—A civil action may not be instituted with 
respect to a violation of this part unless an action 
to impose a civil money penalty may be instituted 
under subsection (a) with respect to such violation 
consistent with the second sentence of section 
1128A(c)(1).’’. 
(2) CONFORMING
AMENDMENTS.—Subsection 
(b) of such section, as amended by subsection (d)(3), 
is amended— 
(A) in paragraph (1), by striking ‘‘A pen-
alty may not be imposed under subsection (a)’’ 
and inserting ‘‘No penalty may be imposed 
under subsection (a) and no damages obtained 
under subsection (c)’’; 
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230 
(B) in paragraph (2)(A)— 
(i) in the matter before clause (i), by 
striking ‘‘a penalty may not be imposed 
under subsection (a)’’ and inserting ‘‘no 
penalty may be imposed under subsection 
(a) and no damages obtained under sub-
section (c)’’; and 
(ii) in clause (ii), by inserting ‘‘or 
damages’’ after ‘‘the penalty’’; 
(C) in paragraph (2)(B)(i), by striking 
‘‘The period’’ and inserting ‘‘With respect to 
the imposition of a penalty by the Secretary 
under subsection (a), the period’’; and 
(D) in paragraph (3), by inserting ‘‘and 
any damages under subsection (c)’’ after ‘‘any 
penalty under subsection (a)’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to violations occurring 
after the date of the enactment of this Act. 
(f) ALLOWING CONTINUED USE OF CORRECTIVE AC-
TION.—Such section is further amended by adding at the 
end the following new subsection: 
‘‘(d) ALLOWING CONTINUED USE OF CORRECTIVE 
ACTION.—Nothing in this section shall be construed as 
preventing the Office of Civil Rights of the Department 
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231 
of Health and Human Services from continuing, in its dis-
cretion, to use corrective action without a penalty in cases 
where the person did not know (and by exercising reason-
able diligence would not have known) of the violation in-
volved.’’. 
SEC. 4411. AUDITS. 
The Secretary shall provide for periodic audits to en-
sure that covered entities and business associates that are 
subject to the requirements of this subtitle and subparts 
C and E of part 164 of title 45, Code of Federal Regula-
tions, as such provisions are in effect as of the date of 
enactment of this Act, comply with such requirements. 
PART II—RELATIONSHIP TO OTHER LAWS; REGU-
LATORY REFERENCES; EFFECTIVE DATE; RE-
PORTS 
SEC. 4421. RELATIONSHIP TO OTHER LAWS. 
(a) APPLICATION OF HIPAA STATE PREEMPTION.— 
Section 1178 of the Social Security Act (42 U.S.C. 
1320d–7) shall apply to a provision or requirement under 
this subtitle in the same manner that such section applies 
to a provision or requirement under part C of title XI of 
such Act or a standard or implementation specification 
adopted or established under sections 1172 through 1174 
of such Act. 
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232 
(b) HEALTH INSURANCE PORTABILITY
AND AC-
COUNTABILITY ACT.—The standards governing the pri-
vacy and security of individually identifiable health infor-
mation promulgated by the Secretary under sections 
262(a) and 264 of the Health Insurance Portability and 
Accountability Act of 1996 shall remain in effect to the 
extent that they are consistent with this subtitle. The Sec-
retary shall by rule amend such Federal regulations as re-
quired to make such regulations consistent with this sub-
title. 
SEC. 4422. REGULATORY REFERENCES. 
Each reference in this subtitle to a provision of the 
Code of Federal Regulations refers to such provision as 
in effect on the date of the enactment of this title (or to 
the most recent update of such provision). 
SEC. 4423. EFFECTIVE DATE. 
Except as otherwise specifically provided, the provi-
sions of part I shall take effect on the date that is 12 
months after the date of the enactment of this title. 
SEC. 4424. STUDIES, REPORTS, GUIDANCE. 
(a) REPORT ON COMPLIANCE.— 
(1) IN GENERAL.—For the first year beginning 
after the date of the enactment of this Act and an-
nually thereafter, the Secretary shall prepare and 
submit to the Committee on Health, Education, 
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233 
Labor, and Pensions of the Senate and the Com-
mittee on Ways and Means and the Committee on 
Energy and Commerce of the House of Representa-
tives a report concerning complaints of alleged viola-
tions of law, including the provisions of this subtitle 
as well as the provisions of subparts C and E of part 
164 of title 45, Code of Federal Regulations (as 
such provisions are in effect as of the date of enact-
ment of this Act), relating to privacy and security of 
health information that are received by the Secretary 
during the year for which the report is being pre-
pared. Each such report shall include, with respect 
to such complaints received during the year— 
(A) the number of such complaints; 
(B) the number of such complaints re-
solved informally, a summary of the types of 
such complaints so resolved, and the number of 
covered entities that received technical assist-
ance from the Secretary during such year in 
order to achieve compliance with such provi-
sions and the types of such technical assistance 
provided; 
(C) the number of such complaints that 
have resulted in the imposition of civil monetary 
penalties or have been resolved through mone-
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234 
tary settlements, including the nature of the 
complaints involved and the amount paid in 
each penalty or settlement; 
(D) the number of compliance reviews con-
ducted and the outcome of each such review; 
(E) the number of subpoenas or inquiries 
issued; 
(F) the Secretary’s plan for improving 
compliance with and enforcement of such provi-
sions for the following year; and 
(G) the number of audits performed and a 
summary of audit findings pursuant to section 
4411. 
(2) AVAILABILITY
TO
PUBLIC.—Each report 
under paragraph (1) shall be made available to the 
public on the Internet website of the Department of 
Health and Human Services. 
(b) STUDY AND REPORT ON APPLICATION OF PRI-
VACY AND SECURITY REQUIREMENTS TO NON-HIPAA 
COVERED ENTITIES.— 
(1) STUDY.—Not later than one year after the 
date of the enactment of this title, the Secretary, in 
consultation with the Federal Trade Commission, 
shall conduct a study, and submit a report under 
paragraph (2), on privacy and security requirements 
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for entities that are not covered entities or business 
associates as of the date of the enactment of this 
title, including— 
(A) requirements relating to security, pri-
vacy, and notification in the case of a breach of 
security or privacy (including the applicability 
of an exemption to notification in the case of 
individually identifiable health information that 
has been rendered unusable, unreadable, or in-
decipherable through technologies or methodolo-
gies recognized by appropriate professional or-
ganization or standard setting bodies to provide 
effective security for the information) that 
should be applied to— 
(i) vendors of personal health records; 
(ii) entities that offer products or 
services through the website of a vendor of 
personal health records; 
(iii) entities that are not covered enti-
ties and that offer products or services 
through the websites of covered entities 
that offer individuals personal health 
records; 
(iv) entities that are not covered enti-
ties and that access information in a per-
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236 
sonal health record or send information to 
a personal health record; and 
(v) third party service providers used 
by a vendor or entity described in clause 
(i), (ii), (iii), or (iv) to assist in providing 
personal health record products or services; 
(B) a determination of which Federal gov-
ernment agency is best equipped to enforce 
such requirements recommended to be applied 
to such vendors, entities, and service providers 
under subparagraph (A); and 
(C) a timeframe for implementing regula-
tions based on such findings. 
(2) REPORT.—The Secretary shall submit to 
the Committee on Finance, the Committee on 
Health, Education, Labor, and Pensions, and the 
Committee on Commerce of the Senate and the 
Committee on Ways and Means and the Committee 
on Energy and Commerce of the House of Rep-
resentatives a report on the findings of the study 
under paragraph (1) and shall include in such report 
recommendations on the privacy and security re-
quirements described in such paragraph. 
(c) GUIDANCE ON IMPLEMENTATION SPECIFICATION 
TO DE-IDENTIFY PROTECTED HEALTH INFORMATION.— 
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Not later than 12 months after the date of the enactment 
of this title, the Secretary shall, in consultation with stake-
holders, issue guidance on how best to implement the re-
quirements for the de-identification of protected health in-
formation under section 164.514(b) of title 45, Code of 
Federal Regulations. 
(d) GAO REPORT ON TREATMENT DISCLOSURES.— 
Not later than one year after the date of the enactment 
of this title, the Comptroller General of the United States 
shall submit to the Committee on Health, Education, 
Labor, and Pensions of the Senate and the Committee on 
Ways and Means and the Committee on Energy and Com-
merce of the House of Representatives a report on the 
best practices related to the disclosure among health care 
providers of protected health information of an individual 
for purposes of treatment of such individual. Such report 
shall include an examination of the best practices imple-
mented by States and by other entities, such as health 
information exchanges and regional health information or-
ganizations, an examination of the extent to which such 
best practices are successful with respect to the quality 
of the resulting health care provided to the individual and 
with respect to the ability of the health care provider to 
manage such best practices, and an examination of the 
use of electronic informed consent for disclosing protected 
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health information for treatment, payment, and health 
care operations. 
TITLE V—MEDICAID 
PROVISIONS 
SEC. 5000. TABLE OF CONTENTS OF TITLE. 
The table of contents of this title is as follows: 
Sec. 5000. Table of contents of title. 
Sec. 5001. Temporary increase of Medicaid FMAP. 
Sec. 5002. Moratoria on certain regulations. 
Sec. 5003. Transitional Medicaid assistance (TMA). 
Sec. 5004. State eligibility option for family planning services. 
Sec. 5005. Protections for Indians under Medicaid and CHIP. 
Sec. 5006. Consultation on Medicaid and CHIP. 
Sec. 5007. Temporary increase in DSH allotments during recession. 
SEC. 5001. TEMPORARY INCREASE OF MEDICAID FMAP. 
(a) PERMITTING MAINTENANCE OF FMAP.—Subject 
to subsections (e), (f), and (g), if the FMAP determined 
without regard to this section for a State for— 
(1) fiscal year 2009 is less than the FMAP as 
so determined for fiscal year 2008, the FMAP for 
the State for fiscal year 2008 shall be substituted 
for the State’s FMAP for fiscal year 2009, before 
the application of this section; 
(2) fiscal year 2010 is less than the FMAP as 
so determined for fiscal year 2008 or fiscal year 
2009 (after the application of paragraph (1)), the 
greater of such FMAP for the State for fiscal year 
2008 or fiscal year 2009 shall be substituted for the 
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State’s FMAP for fiscal year 2010, before the appli-
cation of this section; and 
(3) fiscal year 2011 is less than the FMAP as 
so determined for fiscal year 2008, fiscal year 2009 
(after the application of paragraph (1)), or fiscal 
year 2010 (after the application of paragraph (2)), 
the greatest of such FMAP for the State for fiscal 
year 2008, fiscal year 2009, or fiscal year 2010 shall 
be substituted for the State’s FMAP for fiscal year 
2011, before the application of this section, but only 
for the first calendar quarter in fiscal year 2011. 
(b) GENERAL 4.9 PERCENTAGE POINT INCREASE.— 
(1) IN GENERAL.—Subject to subsections (e), 
(f), and (g) and paragraph (2), for each State for 
calendar quarters during the recession adjustment 
period (as defined in subsection (h)(2)), the FMAP 
(after the application of subsection (a)) shall be in-
creased (without regard to any limitation otherwise 
specified in section 1905(b) of the Social Security 
Act) by 4.9 percentage points. 
(2) SPECIAL ELECTION FOR TERRITORIES.—In 
the case of a State that is not one of the 50 States 
or the District of Columbia, paragraph (1) shall only 
apply if the State makes a one-time election, in a 
form and manner specified by the Secretary and for 
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240 
the entire recession adjustment period, to apply the 
increase in FMAP under paragraph (1) and a 10 
percent increase under subsection (d) instead of ap-
plying a 20 percent increase under subsection (d). 
(c) ADDITIONAL ADJUSTMENT TO REFLECT IN-
CREASE IN UNEMPLOYMENT.— 
(1) IN GENERAL.—Subject to subsections (e), 
(f), and (g), in the case of a State that is a high 
unemployment State (as defined in paragraph (2)) 
for a calendar quarter during the recession adjust-
ment period, the FMAP (taking into account the ap-
plication of subsections (a) and (b)) for such quarter 
shall be further increased by the high unemployment 
percentage point adjustment specified in paragraph 
(3) for the State for the quarter. 
(2) HIGH UNEMPLOYMENT STATE.— 
(A) IN GENERAL.—In this subsection, sub-
ject to subparagraph (B), the term ‘‘high unem-
ployment State’’ means, with respect to a cal-
endar quarter in the recession adjustment pe-
riod, a State that is 1 of the 50 States or the 
District of Columbia and for which the State 
unemployment increase percentage (as com-
puted under paragraph (5)) for the quarter is 
not less than 1.5 percentage points. 
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(B) MAINTENANCE
OF
STATUS.—If a 
State is a high unemployment State for a cal-
endar quarter, it shall remain a high unemploy-
ment State for each subsequent calendar quar-
ter ending before July 1, 2010. 
(3) HIGH UNEMPLOYMENT PERCENTAGE POINT 
ADJUSTMENT.— 
(A) IN
GENERAL.—The high unemploy-
ment percentage point adjustment specified in 
this paragraph for a high unemployment State 
for a quarter is equal to the product of— 
(i) the SMAP for such State and 
quarter (determined after the application 
of subsection (a) and before the application 
of subsection (b)); and 
(ii) subject to subparagraph (B), the 
State unemployment reduction factor spec-
ified in paragraph (4) for the State and 
quarter. 
(B) 
MAINTENANCE
OF
ADJUSTMENT 
LEVEL FOR CERTAIN QUARTERS.—In no case 
shall the State unemployment reduction factor 
applied under subparagraph (A)(ii) for a State 
for a quarter (beginning on or after January 1, 
2009, and ending before July 1, 2010) be less 
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242 
than the State unemployment reduction factor 
applied to the State for the previous quarter 
(taking into account the application of this sub-
paragraph). 
(4) STATE UNEMPLOYMENT REDUCTION FAC-
TOR.—In the case of a high unemployment State for 
which the State unemployment increase percentage 
(as computed under paragraph (5)) with respect to 
a calendar quarter is— 
(A) not less than 1.5, but is less than 2.5, 
percentage points, the State unemployment re-
duction factor for the State and quarter is 6 
percent; 
(B) not less than 2.5, but is less than 3.5, 
percentage points, the State unemployment re-
duction factor for the State and quarter is 12 
percent; or 
(C) not less than 3.5 percentage points, 
the State unemployment reduction factor for 
the State and quarter is 14 percent. 
(5) COMPUTATION OF STATE UNEMPLOYMENT 
INCREASE PERCENTAGE.— 
(A) IN GENERAL.—In this subsection, the 
‘‘State unemployment increase percentage’’ for 
a State for a calendar quarter is equal to the 
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243 
number of percentage points (if any) by 
which— 
(i) the average monthly unemployment 
rate for the State for months in the most 
recent previous 3-consecutive-month period 
for which data are available, subject to 
subparagraph (C); exceeds 
(ii) the lowest average monthly unem-
ployment rate for the State for any 3-con-
secutive-month period preceding the period 
described in clause (i) and beginning on or 
after January 1, 2006. 
(B) AVERAGE MONTHLY UNEMPLOYMENT 
RATE DEFINED.—In this paragraph, the term 
‘‘average monthly unemployment rate’’ means 
the average of the monthly number unemployed, 
divided by the average of the monthly civilian 
labor force, seasonally adjusted, as determined 
based on the most recent monthly publications 
of the Bureau of Labor Statistics of the De-
partment of Labor. 
(C) SPECIAL RULE.—With respect to— 
(i) the first 2 calendar quarters of the 
recession adjustment period, the most re-
cent previous 3-consecutive-month period 
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described in subparagraph (A)(i) shall be 
the 3-consecutive-month period beginning 
with October 2008; and 
(ii) the last 2 calendar quarters of the 
recession adjustment period, the most re-
cent previous 3-consecutive-month period 
described in such subparagraph shall be 
the 3-consecutive-month period beginning 
with December 2009. 
(d) INCREASE IN CAP ON MEDICAID PAYMENTS TO 
TERRITORIES.—Subject to subsections (f) and (g) , with 
respect to entire fiscal years occurring during the reces-
sion adjustment period and with respect to fiscal years 
only a portion of which occurs during such period (and 
in proportion to the portion of the fiscal year that occurs 
during such period), the amounts otherwise determined for 
Puerto Rico, the Virgin Islands, Guam, the Northern Mar-
iana Islands, and American Samoa under subsections (f) 
and (g) of section 1108 of the Social Security Act (42 
U.S.C. 1308) shall each be increased by 20 percent (or, 
in the case of an election under subsection (b)(2), 10 per-
cent). 
(e) SCOPE OF APPLICATION.—The increases in the 
FMAP for a State under this section shall apply for pur-
poses of title XIX of the Social Security Act and— 
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(1) the increases applied under subsections (a), 
(b), and (c) shall not apply with respect— 
(A) to payments under parts A, B, and D 
of title IV or title XXI of such Act (42 U.S.C. 
601 et seq. and 1397aa et seq.); 
(B) to payments under title XIX of such 
Act that are based on the enhanced FMAP de-
scribed in section 2105(b) of such Act (42 
U.S.C. 1397ee(b)); and 
(C) to payments for disproportionate share 
hospital (DSH) payment adjustments under 
section 1923 of such Act (42 U.S.C. 1396r–4); 
and 
(2) the increase provided under subsection (c) 
shall not apply with respect to payments under part 
E of title IV of such Act. 
(f) STATE INELIGIBILITY AND LIMITATION.— 
(1) IN GENERAL.—Subject to paragraphs (2) 
and (3), a State is not eligible for an increase in its 
FMAP under subsection (a), (b), or (c), or an in-
crease in a cap amount under subsection (d), if eligi-
bility standards, methodologies, or procedures under 
its State plan under title XIX of the Social Security 
Act (including any waiver under such title or under 
section 1115 of such Act (42 U.S.C. 1315)) are 
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more restrictive than the eligibility standards, meth-
odologies, or procedures, respectively, under such 
plan (or waiver) as in effect on July 1, 2008. 
(2) STATE
REINSTATEMENT
OF
ELIGIBILITY 
PERMITTED.—Subject to paragraph (3), a State that 
has restricted eligibility standards, methodologies, or 
procedures under its State plan under title XIX of 
the Social Security Act (including any waiver under 
such title or under section 1115 of such Act (42 
U.S.C. 1315)) after July 1, 2008, is no longer ineli-
gible under paragraph (1) beginning with the first 
calendar quarter in which the State has reinstated 
eligibility standards, methodologies, or procedures 
that are no more restrictive than the eligibility 
standards, methodologies, or procedures, respec-
tively, under such plan (or waiver) as in effect on 
July 1, 2008. 
(3) SPECIAL RULES.—A State shall not be in-
eligible under paragraph (1)— 
(A) before July 1, 2009, on the basis of a 
restriction that was applied after July 1, 2008, 
and before the date of the enactment of this 
Act; or 
(B) on the basis of a restriction that was 
effective under State law as of July 1, 2008, 
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247 
and would have been in effect as of such date, 
but for a delay (of not longer than 1 calendar 
quarter) in the approval of a request for a new 
waiver under section 1115 of such Act with re-
spect to such restriction. 
(4) STATE’S APPLICATION TOWARD RAINY DAY 
FUND.—A State is not eligible for an increase in its 
FMAP under subsection (b) or (c), or an increase in 
a cap amount under subsection (d), if any amounts 
attributable (directly or indirectly) to such increase 
are deposited or credited into any reserve or rainy 
day fund of the State. 
(5) RULE
OF
CONSTRUCTION.—Nothing in 
paragraph (1) or (2) shall be construed as affecting 
a State’s flexibility with respect to benefits offered 
under the State Medicaid program under title XIX 
of the Social Security Act (42 U.S.C. 1396 et seq.) 
(including any waiver under such title or under sec-
tion 1115 of such Act (42 U.S.C. 1315)). 
(6) NO
WAIVER
AUTHORITY.—The Secretary 
may not waive the application of this subsection or 
subsection (g) under section 1115 of the Social Se-
curity Act or otherwise. 
(g) REQUIREMENT FOR CERTAIN STATES.—In the 
case of a State that requires political subdivisions within 
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the State to contribute toward the non-Federal share of 
expenditures under the State Medicaid plan required 
under section 1902(a)(2) of the Social Security Act (42 
U.S.C. 1396a(a)(2)), the State is not eligible for an in-
crease in its FMAP under subsection (a), (b), or (c), or 
an increase in a cap amount under subsection (d), if it 
requires that such political subdivisions pay a greater per-
centage of the non-Federal share of such expenditures for 
quarters during the recession adjustment period, than the 
percentage that would have been required by the State 
under such plan on September 30, 2008, prior to applica-
tion of this section. 
(h) DEFINITIONS.—In this section, except as other-
wise provided: 
(1) FMAP.—The term ‘‘FMAP’’ means the 
Federal medical assistance percentage, as defined in 
section 1905(b) of the Social Security Act (42 
U.S.C. 1396d(b)), as determined without regard to 
this section except as otherwise specified. 
(2) RECESSION
ADJUSTMENT
PERIOD.—The 
term ‘‘recession adjustment period’’ means the pe-
riod beginning on October 1, 2008, and ending on 
December 31, 2010. 
(3) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services. 
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249 
(4) SMAP.—The term ‘‘SMAP’’ means, for a 
State, 100 percent minus the Federal medical assist-
ance percentage. 
(5) STATE.—The term ‘‘State’’ has the mean-
ing given such term in section 1101(a)(1) of the So-
cial Security Act (42 U.S.C. 1301(a)(1)) for pur-
poses of title XIX of the Social Security Act (42 
U.S.C. 1396 et seq.). 
(i) SUNSET.—This section shall not apply to items 
and services furnished after the end of the recession ad-
justment period. 
SEC. 5002. MORATORIA ON CERTAIN REGULATIONS. 
(a) EXTENSION OF MORATORIA ON CERTAIN MED-
ICAID REGULATIONS.—The following sections are each 
amended by striking ‘‘April 1, 2009’’ and inserting ‘‘July 
1, 2009’’: 
(1) Section 7002(a)(1) of the U.S. Troop Read-
iness, Veterans’ Care, Katrina Recovery, and Iraq 
Accountability Appropriations Act, 2007 (Public 
Law 110–28), as amended by section 7001(a)(1) of 
the Supplemental Appropriations Act, 2008 (Public 
Law 110–252). 
(2) Section 206 of the Medicare, Medicaid, and 
SCHIP Extension Act of 2007 (Public Law 110– 
173), as amended by section 7001(a)(2) of the Sup-
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250 
plemental Appropriations Act, 2008 (Public Law 
110–252). 
(3) Section 7001(a)(3)(A) of the Supplemental 
Appropriations Act, 2008 (Public Law 110–252). 
(b) ADDITIONAL
MEDICAID
MORATORIUM.—Not-
withstanding any other provision of law, with respect to 
expenditures for services furnished during the period be-
ginning on December 8, 2008 and ending on June 30, 
2009, the Secretary of Health and Human Services shall 
not take any action (through promulgation of regulation, 
issuance of regulatory guidance, use of Federal payment 
audit procedures, or other administrative action, policy, or 
practice, including a Medical Assistance Manual trans-
mittal or letter to State Medicaid directors) to implement 
the final regulation relating to clarification of the defini-
tion of outpatient hospital facility services under the Med-
icaid program published on November 7, 2008 (73 Federal 
Register 66187). 
SEC. 5003. TRANSITIONAL MEDICAID ASSISTANCE (TMA). 
(a) 18-MONTH EXTENSION.— 
(1) IN GENERAL.—Sections 1902(e)(1)(B) and 
1925(f) of the Social Security Act (42 U.S.C. 
1396a(e)(1)(B), 1396r–6(f)) are each amended by 
striking ‘‘September 30, 2003’’ and inserting ‘‘De-
cember 31, 2010’’. 
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251 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on July 1, 2009. 
(b) STATE OPTION OF INITIAL 12-MONTH ELIGI-
BILITY.—Section 1925 of the Social Security Act (42 
U.S.C. 1396r–6) is amended— 
(1) in subsection (a)(1), by inserting ‘‘but sub-
ject to paragraph (5)’’ after ‘‘Notwithstanding any 
other provision of this title’’; 
(2) by adding at the end of subsection (a) the 
following: 
‘‘(5) OPTION OF 12-MONTH INITIAL ELIGIBILITY 
PERIOD.—A State may elect to treat any reference 
in this subsection to a 6-month period (or 6 months) 
as a reference to a 12-month period (or 12 months). 
In the case of such an election, subsection (b) shall 
not apply.’’; and 
(3) in subsection (b)(1), by inserting ‘‘but sub-
ject to subsection (a)(5)’’ after ‘‘Notwithstanding 
any other provision of this title’’. 
(c) REMOVAL OF REQUIREMENT FOR PREVIOUS RE-
CEIPT OF MEDICAL ASSISTANCE.—Section 1925(a)(1) of 
such Act (42 U.S.C. 1396r–6(a)(1)), as amended by sub-
section (b)(1), is further amended— 
(1) by inserting ‘‘subparagraph (B) and’’ before 
‘‘paragraph (5)’’; 
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252 
(2) by redesignating the matter after ‘‘RE-
QUIREMENT.—’’ as a subparagraph (A) with the 
heading ‘‘IN GENERAL.—’’ and with the same inden-
tation as subparagraph (B) (as added by paragraph 
(3)); and 
(3) by adding at the end the following: 
‘‘(B) STATE OPTION TO WAIVE REQUIRE-
MENT
FOR
MONTHS
BEFORE
RECEIPT
OF 
MEDICAL ASSISTANCE.—A State may, at its op-
tion, elect also to apply subparagraph (A) in 
the case of a family that was receiving such aid 
for fewer than three months or that had applied 
for and was eligible for such aid for fewer than 
3 months during the 6 immediately preceding 
months described in such subparagraph.’’. 
(d) CMS REPORT ON ENROLLMENT AND PARTICIPA-
TION RATES UNDER TMA.—Section 1925 of such Act (42 
U.S.C. 1396r–6), as amended by this section, is further 
amended by adding at the end the following new sub-
section: 
‘‘(g) COLLECTION AND REPORTING OF PARTICIPA-
TION INFORMATION.— 
‘‘(1) COLLECTION
OF
INFORMATION
FROM 
STATES.—Each State shall collect and submit to the 
Secretary (and make publicly available), in a format 
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253 
specified by the Secretary, information on average 
monthly enrollment and average monthly participa-
tion rates for adults and children under this section 
and of the number and percentage of children who 
become ineligible for medical assistance under this 
section whose medical assistance is continued under 
another eligibility category or who are enrolled under 
the State’s child health plan under title XXI. Such 
information shall be submitted at the same time and 
frequency in which other enrollment information 
under this title is submitted to the Secretary. 
‘‘(2) ANNUAL REPORTS TO CONGRESS.—Using 
the information submitted under paragraph (1), the 
Secretary shall submit to Congress annual reports 
concerning enrollment and participation rates de-
scribed in such paragraph.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
subsections (b) through (d) shall take effect on July 1, 
2009. 
SEC. 5004. STATE ELIGIBILITY OPTION FOR FAMILY PLAN-
NING SERVICES. 
(a) 
COVERAGE
AS
OPTIONAL
CATEGORICALLY 
NEEDY GROUP.— 
(1) IN
GENERAL.—Section 1902(a)(10)(A)(ii) 
of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
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254 
1396a(a)(10)(A)(ii)), as amended by section 3003(a) 
of the Health Insurance Assistance for the Unem-
ployed Act of 2009, is amended— 
(A) in subclause (XIX), by striking ‘‘or’’ at 
the end; 
(B) in subclause (XX), by adding ‘‘or’’ at 
the end; and 
(C) by adding at the end the following new 
subclause: 
‘‘(XXI) who are described in subsection (ee) 
(relating to individuals who meet certain income 
standards);’’. 
(2) GROUP DESCRIBED.—Section 1902 of such 
Act (42 U.S.C. 1396a), as amended by section 
3003(a) of the Health Insurance Assistance for the 
Unemployed Act of 2009, is amended by adding at 
the end the following new subsection: 
‘‘(ee)(1) Individuals described in this subsection are 
individuals— 
‘‘(A) whose income does not exceed an in-
come eligibility level established by the State 
that does not exceed the highest income eligi-
bility level established under the State plan 
under this title (or under its State child health 
plan under title XXI) for pregnant women; and 
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255 
‘‘(B) who are not pregnant. 
‘‘(2) At the option of a State, individuals de-
scribed in this subsection may include individuals 
who, had individuals applied on or before January 1, 
2007, would have been made eligible pursuant to the 
standards and processes imposed by that State for 
benefits described in clause (XV) of the matter fol-
lowing subparagraph (G) of section subsection 
(a)(10) pursuant to a waiver granted under section 
1115. 
‘‘(3) At the option of a State, for purposes of 
subsection (a)(17)(B), in determining eligibility for 
services under this subsection, the State may con-
sider only the income of the applicant or recipient.’’. 
(3) 
LIMITATION
ON
BENEFITS.—Section 
1902(a)(10) of the Social Security Act (42 U.S.C. 
1396a(a)(10)) is amended in the matter following 
subparagraph (G)— 
(A) by striking ‘‘and (XIV)’’ and inserting 
‘‘(XIV)’’; and 
(B) by inserting ‘‘, and (XV) the medical 
assistance made available to an individual de-
scribed in subsection (ee) shall be limited to 
family planning services and supplies described 
in section 1905(a)(4)(C) including medical di-
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256 
agnosis and treatment services that are pro-
vided pursuant to a family planning service in 
a family planning setting’’ after ‘‘cervical can-
cer’’. 
(4) 
CONFORMING
AMENDMENTS.—Section 
1905(a) of the Social Security Act (42 U.S.C. 
1396d(a)), as amended by section 3003(c)(2) of the 
Health Insurance Assistance for the Unemployed 
Act of 2009, is amended in the matter preceding 
paragraph (1)— 
(A) in clause (xiii), by striking ‘‘or’’ at the 
end; 
(B) in clause (xiv), by adding ‘‘or’’ at the 
end; and 
(C) by inserting after clause (xiii) the fol-
lowing: 
‘‘(xv) individuals described in section 
1902(ee),’’. 
(b) PRESUMPTIVE ELIGIBILITY.— 
(1) IN GENERAL.—Title XIX of the Social Se-
curity Act (42 U.S.C. 1396 et seq.) is amended by 
inserting after section 1920B the following: 
‘‘PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING 
SERVICES 
‘‘SEC. 1920C. (a) STATE OPTION.—State plan ap-
proved under section 1902 may provide for making med-
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257 
ical assistance available to an individual described in sec-
tion 1902(ee) (relating to individuals who meet certain in-
come eligibility standard) during a presumptive eligibility 
period. In the case of an individual described in section 
1902(ee), such medical assistance shall be limited to fam-
ily 
planning 
services 
and 
supplies 
described 
in 
1905(a)(4)(C) and, at the State’s option, medical diag-
nosis and treatment services that are provided in conjunc-
tion with a family planning service in a family planning 
setting. 
‘‘(b) DEFINITIONS.—For purposes of this section: 
‘‘(1) PRESUMPTIVE ELIGIBILITY PERIOD.—The 
term ‘presumptive eligibility period’ means, with re-
spect to an individual described in subsection (a), 
the period that— 
‘‘(A) begins with the date on which a 
qualified entity determines, on the basis of pre-
liminary information, that the individual is de-
scribed in section 1902(ee); and 
‘‘(B) ends with (and includes) the earlier 
of— 
‘‘(i) the day on which a determination 
is made with respect to the eligibility of 
such individual for services under the State 
plan; or 
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258 
‘‘(ii) in the case of such an individual 
who does not file an application by the last 
day of the month following the month dur-
ing which the entity makes the determina-
tion referred to in subparagraph (A), such 
last day. 
‘‘(2) QUALIFIED ENTITY.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the term ‘qualified entity’ means 
any entity that— 
‘‘(i) is eligible for payments under a 
State plan approved under this title; and 
‘‘(ii) is determined by the State agen-
cy to be capable of making determinations 
of the type described in paragraph (1)(A). 
‘‘(B) RULE OF CONSTRUCTION.—Nothing 
in this paragraph shall be construed as pre-
venting a State from limiting the classes of en-
tities that may become qualified entities in 
order to prevent fraud and abuse. 
‘‘(c) ADMINISTRATION.— 
‘‘(1) IN GENERAL.—The State agency shall pro-
vide qualified entities with— 
‘‘(A) such forms as are necessary for an 
application to be made by an individual de-
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259 
scribed in subsection (a) for medical assistance 
under the State plan; and 
‘‘(B) information on how to assist such in-
dividuals in completing and filing such forms. 
‘‘(2) NOTIFICATION REQUIREMENTS.—A quali-
fied 
entity 
that 
determines 
under 
subsection 
(b)(1)(A) that an individual described in subsection 
(a) is presumptively eligible for medical assistance 
under a State plan shall— 
‘‘(A) notify the State agency of the deter-
mination within 5 working days after the date 
on which determination is made; and 
‘‘(B) inform such individual at the time 
the determination is made that an application 
for medical assistance is required to be made by 
not later than the last day of the month fol-
lowing the month during which the determina-
tion is made. 
‘‘(3) 
APPLICATION
FOR
MEDICAL
ASSIST-
ANCE.—In the case of an individual described in 
subsection (a) who is determined by a qualified enti-
ty to be presumptively eligible for medical assistance 
under a State plan, the individual shall apply for 
medical assistance by not later than the last day of 
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260 
the month following the month during which the de-
termination is made. 
‘‘(d) PAYMENT.—Notwithstanding any other provi-
sion of law, medical assistance that— 
‘‘(1) is furnished to an individual described in 
subsection (a)— 
‘‘(A) during a presumptive eligibility pe-
riod; and 
‘‘(B) by a entity that is eligible for pay-
ments under the State plan; and 
‘‘(2) is included in the care and services covered 
by the State plan, 
shall be treated as medical assistance provided by such 
plan for purposes of clause (4) of the first sentence of 
section 1905(b).’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1902(a)(47) of the Social Se-
curity Act (42 U.S.C. 1396a(a)(47)) is amend-
ed by inserting before the semicolon at the end 
the following: ‘‘and provide for making medical 
assistance available to individuals described in 
subsection (a) of section 1920C during a pre-
sumptive eligibility period in accordance with 
such section’’. 
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261 
(B) Section 1903(u)(1)(D)(v) of such Act 
(42 U.S.C. 1396b(u)(1)(D)(v)) is amended— 
(i) by striking ‘‘or for’’ and inserting 
‘‘for’’; and 
(ii) by inserting before the period the 
following: ‘‘, or for medical assistance pro-
vided to an individual described in sub-
section (a) of section 1920C during a pre-
sumptive eligibility period under such sec-
tion’’. 
(c) CLARIFICATION OF COVERAGE OF FAMILY PLAN-
NING SERVICES AND SUPPLIES.—Section 1937(b) of the 
Social Security Act (42 U.S.C. 1396u–7(b)) is amended 
by adding at the end the following: 
‘‘(5) COVERAGE OF FAMILY PLANNING SERV-
ICES AND SUPPLIES.—Notwithstanding the previous 
provisions of this section, a State may not provide 
for medical assistance through enrollment of an indi-
vidual with benchmark coverage or benchmark-equiv-
alent coverage under this section unless such cov-
erage includes for any individual described in section 
1905(a)(4)(C), medical assistance for family plan-
ning services and supplies in accordance with such 
section.’’. 
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262 
(d) EFFECTIVE DATE.—The amendments made by 
this section take effect on the date of the enactment of 
this Act and shall apply to items and services furnished 
on or after such date. 
SEC. 5005. PROTECTIONS FOR INDIANS UNDER MEDICAID 
AND CHIP. 
(a) PREMIUMS
AND COST SHARING PROTECTION 
UNDER MEDICAID.— 
(1) IN GENERAL.—Section 1916 of the Social 
Security Act (42 U.S.C. 1396o) is amended— 
(A) in subsection (a), in the matter pre-
ceding paragraph (1), by striking ‘‘and (i)’’ and 
inserting ‘‘, (i), and (j)’’; and 
(B) by adding at the end the following new 
subsection: 
‘‘(j) NO PREMIUMS OR COST SHARING FOR INDIANS 
FURNISHED ITEMS OR SERVICES DIRECTLY BY INDIAN 
HEALTH PROGRAMS OR THROUGH REFERRAL UNDER 
CONTRACT HEALTH SERVICES.— 
‘‘(1) NO COST SHARING FOR ITEMS OR SERV-
ICES
FURNISHED
TO
INDIANS
THROUGH
INDIAN 
HEALTH PROGRAMS.— 
‘‘(A) IN
GENERAL.—No enrollment fee, 
premium, or similar charge, and no deduction, 
copayment, cost sharing, or similar charge shall 
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263 
be imposed against an Indian who is furnished 
an item or service directly by the Indian Health 
Service, an Indian Tribe, Tribal Organization, 
or Urban Indian Organization or through refer-
ral under contract health services for which 
payment may be made under this title. 
‘‘(B) NO REDUCTION IN AMOUNT OF PAY-
MENT TO INDIAN HEALTH PROVIDERS.—Pay-
ment due under this title to the Indian Health 
Service, an Indian Tribe, Tribal Organization, 
or Urban Indian Organization, or a health care 
provider through referral under contract health 
services for the furnishing of an item or service 
to an Indian who is eligible for assistance under 
such title, may not be reduced by the amount 
of any enrollment fee, premium, or similar 
charge, or any deduction, copayment, cost shar-
ing, or similar charge that would be due from 
the Indian but for the operation of subpara-
graph (A). 
‘‘(2) RULE
OF
CONSTRUCTION.—Nothing in 
this subsection shall be construed as restricting the 
application of any other limitations on the imposi-
tion of premiums or cost sharing that may apply to 
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264 
an individual receiving medical assistance under this 
title who is an Indian.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
1916A(b)(3) of such Act (42 U.S.C. 1396o–1(b)(3)) 
is amended— 
(A) in subparagraph (A), by adding at the 
end the following new clause: 
‘‘(vi) An Indian who is furnished an 
item or service directly by the Indian 
Health Service, an Indian Tribe, Tribal 
Organization or Urban Indian Organiza-
tion or through referral under contract 
health services.’’; and 
(B) in subparagraph (B), by adding at the 
end the following new clause: 
‘‘(ix) Items and services furnished to 
an Indian directly by the Indian Health 
Service, an Indian Tribe, Tribal Organiza-
tion or Urban Indian Organization or 
through referral under contract health 
services.’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on October 1, 
2009. 
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265 
(b) TREATMENT OF CERTAIN PROPERTY FROM RE-
SOURCES FOR MEDICAID AND CHIP ELIGIBILITY.— 
(1) MEDICAID.—Section 1902 of the Social Se-
curity Act (42 U.S.C. 1396a), as amended by sec-
tion 3003(a) of the Health Insurance Assistance for 
the Unemployed Act of 2009 and section 5004, is 
amended by adding at the end the following new 
subsection: 
‘‘(ff) Notwithstanding any other requirement of this 
title or any other provision of Federal or State law, a State 
shall disregard the following property from resources for 
purposes of determining the eligibility of an individual who 
is an Indian for medical assistance under this title: 
‘‘(1) Property, including real property and im-
provements, that is held in trust, subject to Federal 
restrictions, or otherwise under the supervision of 
the Secretary of the Interior, located on a reserva-
tion, including any federally recognized Indian 
Tribe’s reservation, pueblo, or colony, including 
former reservations in Oklahoma, Alaska Native re-
gions established by the Alaska Native Claims Set-
tlement Act, and Indian allotments on or near a res-
ervation as designated and approved by the Bureau 
of Indian Affairs of the Department of the Interior. 
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266 
‘‘(2) For any federally recognized Tribe not de-
scribed in paragraph (1), property located within the 
most recent boundaries of a prior Federal reserva-
tion. 
‘‘(3) Ownership interests in rents, leases, royal-
ties, or usage rights related to natural resources (in-
cluding extraction of natural resources or harvesting 
of timber, other plants and plant products, animals, 
fish, and shellfish) resulting from the exercise of fed-
erally protected rights. 
‘‘(4) Ownership interests in or usage rights to 
items not covered by paragraphs (1) through (3) 
that have unique religious, spiritual, traditional, or 
cultural significance or rights that support subsist-
ence or a traditional lifestyle according to applicable 
tribal law or custom.’’. 
(2) APPLICATION TO CHIP.—Section 2107(e)(1) 
of such Act (42 U.S.C. 1397gg(e)(1)) is amended by 
adding at the end the following new subparagraph: 
‘‘(E) Section 1902(ff) (relating to dis-
regard of certain property for purposes of mak-
ing eligibility determinations).’’. 
(c) CONTINUATION OF CURRENT LAW PROTECTIONS 
OF CERTAIN INDIAN PROPERTY FROM MEDICAID ESTATE 
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267 
RECOVERY.—Section 1917(b)(3) of the Social Security 
Act (42 U.S.C. 1396p(b)(3)) is amended— 
(1) by inserting ‘‘(A)’’ after ‘‘(3)’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) The standards specified by the Sec-
retary under subparagraph (A) shall require 
that the procedures established by the State 
agency under subparagraph (A) exempt income, 
resources, and property that are exempt from 
the application of this subsection as of April 1, 
2003, under manual instructions issued to carry 
out this subsection (as in effect on such date) 
because of the Federal responsibility for Indian 
Tribes and Alaska Native Villages. Nothing in 
this subparagraph shall be construed as pre-
venting the Secretary from providing additional 
estate recovery exemptions under this title for 
Indians.’’. 
SEC. 5006. CONSULTATION ON MEDICAID AND CHIP. 
(a) IN GENERAL.—Section 1139 of the Social Secu-
rity Act (42 U.S.C. 1320b–9) is amended to read as fol-
lows: 
‘‘CONSULTATION WITH TRIBAL TECHNICAL ADVISORY 
GROUP (TTAG) 
‘‘SEC. 1139. 
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268 
‘‘The Secretary shall maintain within the Centers for 
Medicaid & Medicare Services (CMS) a Tribal Technical 
Advisory Group, which was first established in accordance 
with requirements of the charter dated September 30, 
2003, and the Secretary shall include in such Group a rep-
resentative of the Urban Indian Organizations and the 
Service. The representative of the Urban Indian Organiza-
tion shall be deemed to be an elected officer of a tribal 
government for purposes of applying section 204(b) of the 
Unfunded Mandates Reform Act of 1995 (2 U.S.C. 
1534(b)).’’. 
(b) SOLICITATION OF ADVICE UNDER MEDICAID AND 
CHIP.— 
(1) MEDICAID STATE PLAN AMENDMENT.—Sec-
tion 1902(a) of the Social Security Act (42 U.S.C. 
1396a(a)) is amended— 
(A) in paragraph (70), by striking ‘‘and’’ 
at the end; 
(B) in paragraph (71), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(C) by inserting after paragraph (71), the 
following new paragraph: 
‘‘(72) in the case of any State in which 1 or 
more Indian Health Programs or Urban Indian Or-
ganizations furnishes health care services, provide 
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269 
for a process under which the State seeks advice on 
a regular, ongoing basis from designees of such In-
dian Health Programs and Urban Indian Organiza-
tions on matters relating to the application of this 
title that are likely to have a direct effect on such 
Indian Health Programs and Urban Indian Organi-
zations and that— 
‘‘(A) shall include solicitation of advice 
prior to submission of any plan amendments, 
waiver requests, and proposals for demonstra-
tion projects likely to have a direct effect on In-
dians, Indian Health Programs, or Urban In-
dian Organizations; and 
‘‘(B) may include appointment of an advi-
sory committee and of a designee of such In-
dian Health Programs and Urban Indian Orga-
nizations to the medical care advisory com-
mittee advising the State on its State plan 
under this title.’’. 
(2) APPLICATION TO CHIP.—Section 2107(e)(1) 
of such Act (42 U.S.C. 1397gg(e)(1)), as amended 
by section 5005(b), is amended by adding at the end 
the following new subparagraph: 
‘‘(F) Section 1902(a)(72) (relating to re-
quiring certain States to seek advice from des-
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270 
ignees of Indian Health Programs and Urban 
Indian Organizations).’’. 
(c) RULE
OF
CONSTRUCTION.—Nothing in the 
amendments made by this section shall be construed as 
superseding existing advisory committees, working groups, 
guidance, or other advisory procedures established by the 
Secretary of Health and Human Services or by any State 
with respect to the provision of health care to Indians. 
SEC. 5007. TEMPORARY INCREASE IN DSH ALLOTMENTS 
DURING RECESSION. 
Section 1923(f)(3) of the Social Security Act (42 
U.S.C. 1396r–4(f)(3)) is amended— 
(1) in subparagraph (A), by striking ‘‘para-
graph (6)’’ and inserting ‘‘paragraph (6) and sub-
paragraph (E)’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(E) TEMPORARY
INCREASE
IN
ALLOT-
MENTS DURING RECESSION.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), the DSH allotment for any State— 
‘‘(I) for fiscal year 2009 is equal 
to 102.5 percent of the DSH allot-
ment that would be determined under 
this paragraph for the State for fiscal 
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271 
year 2009 without application of this 
subparagraph, notwithstanding sub-
paragraph (B); 
‘‘(II) for fiscal year 2010 is equal 
to 102.5 percent of the the DSH al-
lotment for the State for fiscal year 
2009, as determined under subclause 
(I); and 
‘‘(III) for each succeeding fiscal 
year is equal to the DSH allotment 
for the State under this paragraph de-
termined without applying subclauses 
(I) and (II). 
‘‘(ii) APPLICATION.—Clause (i) shall 
not apply to a State for a year in the case 
that the DSH allotment for such State for 
such year under this paragraph determined 
without applying clause (i) would grow 
higher than the DSH allotment specified 
under clause (i) for the State for such 
year.’’. 
Æ 
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