Improvement Act, the Secretary shall establish a process 
for certifying patient safety organizations. 
‘‘(b) PROCESS.—The process established under sub-
section (a) shall include the following: 
‘‘(1) Certification of patient safety organiza-
tions by the Secretary or by such other national or 
State governmental organizations as the Secretary 
determines appropriate. 
‘‘(2) If the Secretary allows other governmental 
organizations to certify patient safety organizations 
under paragraph (1), the Secretary shall establish a 
process for approving such organizations. Any such 
approved organization shall conduct certifications 
and reviews in accordance with this section. 
‘‘(3) A review of each certification under para-
graph (1) (including a review of compliance with 
each criterion in this section and any related imple-
menting standards as determined by the Secretary 
through rulemaking) not less often than every 3 
years, as determined by the Secretary. 
‘‘(4) Revocation of any such certification by the 
Secretary or other such governmental organization 
that issued the certification, upon a showing of 
cause.
‘‘(c) CRITERIA.—A patient safety organization must 
meet the following criteria as conditions of certification: 
‘‘(1) The mission of the patient safety organiza-
tion is to conduct activities that are to improve pa-
tient safety and the quality of health care delivery 
and is not in conflict of interest with the providers 
that contract with the patient safety organization. 
‘‘(2) The patient safety organization has appro-
priately qualified staff, including licensed or certified 
medical professionals. 
‘‘(3) The patient safety organization, within any 
2 year period, contracts with more than 1 provider 
for the purpose of receiving and reviewing patient 
safety work product. 
‘‘(4) The patient safety organization is not a 
component of a health insurer or other entity that 
offers a group health plan or health insurance cov-
erage. 
‘‘(5) The patient safety organization is man-
aged, controlled, and operated independently from 
any provider that contracts with the patient safety 
organization for reporting patient safety work prod-
uct. 
‘‘(6) To the extent practical and appropriate, 
the patient safety organization collects patient safety
work product from providers in a standardized man-
ner that permits valid comparisons of similar cases 
among similar providers. 
‘‘(d) ADDITIONAL CRITERIA FOR COMPONENT ORGA-
NIZATIONS.—If a patient safety organization is a compo-
nent of another organization, the patient safety organiza-
tion must, in addition to meeting the criteria described 
in subsection (c), meet the following criteria as conditions 
of certification: 
‘‘(1) The patient safety organization maintains 
patient safety work product separately from the rest 
of the organization, and establishes appropriate se-
curity measures to maintain the confidentiality of 
the patient safety work product. 
‘‘(2) The patient safety organization does not 
make an unauthorized disclosure under this Act of 
patient safety work product to the rest of the orga-
nization in breach of confidentiality. 
‘‘(3) The mission of the patient safety organiza-
tion does not create a conflict of interest with the 
rest of the organization.’’. 
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 
937 of the Public Health Service Act (as redesignated by 
subsection (a)) is amended by adding at the end the fol-
lowing:
‘‘(e) PATIENT SAFETY
AND QUALITY IMPROVE-
MENT.—For the purpose of carrying out part C, there are 
authorized to be appropriated such sums as may be nec-
essary for each of the fiscal years 2006 through 2010.’’. 
Subtitle B—Liability Protection in 
Good-faith Reporting 
SEC. 311. LIABILITY PROTECTION FOR HEALTH CARE PRO-
VIDERS 
IN 
GOOD-FAITH 
REPORTING 
TO 
STATE MEDICAL BOARDS. 
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, no health care provider providing information 
(including by making a report, filing charges, or pre-
senting evidence) to a State medical board regarding the 
competence or professional conduct of a physician shall 
be held, by reason of having provided such information, 
to be liable in damages under any law of the United States 
or of any State (or political subdivision thereof) unless 
such information is false and the person providing the in-
formation knew that the information was false. 
(b) ATTORNEY FEES.—If a health care provider es-
tablishes in a civil action that the health care provider is 
not liable in damages because of the application of sub-
section (a), the court shall award to the provider any at-
torney fees and costs incurred by the provider in estab-
lishing the application of subsection (a).
(c) DEFINITION.—In this section, the term ‘‘State 
medical board’’ means a State entity responsible for li-
censing physicians or a subdivision of such an entity. 
TITLE IV—INSURANCE REFORM 
SEC. 401. UNIFORM STATE REQUIREMENTS REGARDING 
PROPOSED RATE INCREASES. 
(a) IN GENERAL.—The Congress intends that each 
State have in effect laws or regulations providing that— 
(1) a provider of medical malpractice insurance 
in the State may not implement any increase in the 
rate for such insurance that would result in such 
rate increasing more than a certain percentage, as 
specified in such laws or regulations, within a cer-
tain period of time, as specified in such laws or reg-
ulations, unless, before such increase takes effect— 
(A) the provider submits to an appropriate 
State agency a description and justification of 
the rate increase; and 
(B) such agency makes a determination 
that the increase is justified; 
(2) any determination referred to in paragraph 
(1)(B) regarding an increase in medical malpractice 
insurance rates is made pursuant to an administra-
tive hearing held by the appropriate State agency; 
and
(3) any individual or institution that is involved 
in the provision of health care and is licensed by the 
State to provide such care has standing, in any ad-
ministrative proceeding of the State regarding a pro-
posed increase in the rate for medical malpractice 
insurance (including a hearing referred to in para-
graph (2)), to challenge such increase. 
(b) REPORT.—Not later than 2 years after the date 
of the enactment of this Act, the Secretary of Health and 
Human Services shall— 
(1) conduct and complete a survey of the laws 
and regulations of the States to determine the extent 
to which the States have in effects laws or regula-
tions described in subsection (a); and 
(2) submit a report to the Congress setting 
forth the results of the survey, describing such laws 
and regulations of the various States, and describing 
the extent of the uniformity of such laws and regula-
tions. 
(c) DEFINITION.—For purposes of this section, the 
term ‘‘State’’ has the meaning given such term in section 
105. 
(d) EFFECTIVE DATE.—This section shall take effect 
on the date of the enactment of this Act.
SEC. 402. REDUCTION IN PREMIUMS PAID BY PHYSICIANS 
FOR 
MEDICAL 
MALPRACTICE 
INSURANCE 
COVERAGE. 
(a) IN GENERAL.—Not later than 180 days after the 
date of the enactment of this Act, each medical mal-
practice liability insurance company shall— 
(1) develop a reasonable estimate of the annual 
amount of financial savings that will be achieved by 
the company as a result of section 101; 
(2) develop and implement a plan to annually 
dedicate at least 50 percent of such annual savings 
to reduce the amount of premiums that the company 
charges physicians for medical malpractice liability 
coverage; and 
(3) submit to the Secretary of Health and 
Human Services (in this subsection referred to as 
the ‘‘Secretary’’) a written certification that the 
company has complied with paragraphs (1) and (2). 
(b) REPORTS.—Not later than one year after the date 
of the enactment of this Act and annually thereafter, each 
medical malpractice liability insurance company shall sub-
mit to the Secretary a report that identifies the percentage 
by which the company has reduced medical malpractice 
coverage premiums relative to the date of the enactment 
of this Act.
(c) ENFORCEMENT.—A medical malpractice liability 
insurance company that violates a provision of this section 
is liable to the United States for a civil penalty in an 
amount assessed by the Secretary, not to exceed $11,000 
for each such violation. The provisions of paragraphs (3) 
through (5) of section 303(g) of the Federal Food, Drug, 
and Cosmetic Act apply to such a civil penalty to the same 
extent and in the same manner as such paragraphs apply 
to a civil penalty under such section. 
(d) DEFINITION.—For purposes of this section, the 
term ‘‘medical malpractice liability insurance company’’ 
means an entity in the business of providing an insurance 
policy under which the entity makes payment in settlement 
(or partial settlement) of, or in satisfaction of a judgment 
in, a medical malpractice action or claim. 
SEC. 403. EFFECTIVE DATE. 
Except as provided in section 401(d), this title shall 
take effect 1 year after the date of the enactment of this 
Act.
TITLE V—EXCLUSION OF PHAR-
MACEUTICALS AND DEVICES 
FROM LIABILITY REFORMS 
SEC. 501. EXCLUSION OF PHARMACEUTICALS AND DE-
VICES. 
For purposes of title I and II of this Act, the manu-
facturer or distributor of a pharmaceutical or device is not 
a health care provider, and health care malpractice does 
not include responsibility based on products liability. 
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